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EXHIBIT 1.1
5,500,000 Shares
EVERGREEN MEDIA CORPORATION
$3.00 Convertible Exchangeable Preferred Stock
PURCHASE AGREEMENT
June 10, 1997
Alex. ▇▇▇▇▇ & Sons Incorporated
BT Securities Corporation
Credit Suisse First Boston Corporation
▇▇▇▇▇▇▇, Sachs & Co.
NationsBanc Capital Markets, Inc.
TD Securities (USA) Inc.
c/o Alex. ▇▇▇▇▇ & Sons Incorporated
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Evergreen Media Corporation (the "COMPANY"), a Delaware corporation,
hereby confirms its agreement with you (the "INITIAL PURCHASERS"), as set forth
below.
1. The Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Initial Purchasers
5,500,000 shares of its $3.00 Convertible Exchangeable Preferred Stock, par
value $.01 per share (the "FIRM SHARES"). The Company also proposes to issue
and sell to the Initial Purchasers not more than 500,000 additional shares of
its $3.00 Convertible Preferred Stock (the "Additional Shares") if requested by
the Initial Purchasers pursuant to Section 3 hereof. The Firm Shares and the
Additional Shares are herein collectively referred to as the "Shares." The
shares of $3.00 Convertible Exchangeable Preferred Stock to be outstanding
after giving effect to the sales contemplated hereby are hereafter referred to
as the "Convertible Preferred Stock."
The Shares are convertible at the option of the holder at any time,
unless previously redeemed or exchanged, into Class A Common Stock, par value
$.01
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per share (the "CLASS A COMMON STOCK"), of the Company at a conversion price of
$50.00 per share of Class A Common Stock subject to adjustment. The Shares are
exchangeable, subject to certain conditions, at the option of the Company, in
whole but not in part, on any dividend payment date commencing September 15,
2000, for the Company=s 6% Convertible Subordinated Debentures due 2012 (the
"DEBENTURES"). The Debentures are to be issued under an indenture (the
"INDENTURE") dated as of June 16, 1997 between the Company and Bank of New
York, as trustee (the "TRUSTEE"). The Debentures are convertible, at the
option of the holders thereof into Class A Common Stock at a conversion price
of $50.00 per share of Class A Common Stock subject to adjustment. The Shares,
the Debentures issuable on exchange thereof and the Class A Common Stock
issuable upon conversion of the Shares or the Debentures, as appropriate, are
referred to herein collectively as the "SECURITIES."
The Shares will be offered and sold to the Initial Purchasers without
being registered under the Securities Act of 1933, as amended (the "ACT"), in
reliance on exemptions therefrom.
In connection with the sale of the Shares, the Company has prepared a
preliminary offering memorandum dated May 23, 1997 (the "PRELIMINARY
MEMORANDUM"), and a final offering memorandum dated June 10, 1997 (the "FINAL
MEMORANDUM;" the Preliminary Memorandum and the Final Memorandum each herein
being referred to as a "MEMORANDUM") setting forth or including a description
of the terms of the Securities, the terms of the offering of the Shares, a
description of the Company and any material developments relating to the
Company occurring after the date of the most recent historical financial
statements included therein. All references in this Agreement to a Memorandum
include the documents incorporated by reference therein.
The Initial Purchasers and their direct and indirect transferees of
the Securities will be entitled to the benefits of the Registration Rights
Agreement, substantially in the form attached hereto as Exhibit A (the
"REGISTRATION RIGHTS AGREEMENT"), pursuant to which the Company has agreed,
among other things, to file a shelf registration statement (the "REGISTRATION
STATEMENT") with the Securities and Exchange Commission (the "COMMISSION")
registering the Securities under the Act.
2. Representations and Warranties of the Company. The Company
represents and warrants to and agrees with the Initial Purchasers that:
(a) Each document, if any, filed or to be filed pursuant to
the Securities Exchange Act of 1934 (the "Exchange Act"), as amended,
and
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incorporated by reference in the Final Memorandum complied or will
comply when so filed in all material respects with the Exchange Act
and the applicable rules and regulations of the Commission thereunder.
(b) Neither the Preliminary Memorandum as of the date
thereof nor the Final Memorandum nor any amendment or supplement
thereto as of the date thereof and at all times subsequent thereto up
to the Closing Date (as defined in Section 3 below) contained or
contains any untrue statement of a material fact or omitted or omits
to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth
in this Section 2(b) shall not apply to statements or omissions made
in reliance upon and in conformity with information relating to any of
the Initial Purchasers furnished to the Company in writing by the
Initial Purchasers expressly for use in the Preliminary Memorandum,
the Final Memorandum or any amendment or supplement thereto.
(c) Each of the Company and its subsidiaries has been duly
incorporated, is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation and has the
corporate power and authority to carry on its business as it is
currently being conducted and to own, lease and operate its
properties, and each is or as of the Closing Date will be duly
qualified and is or as of the Closing Date will be in good standing as
a foreign corporation authorized to do business in each jurisdiction
in which the nature of its business or its ownership or leasing of
property requires such qualification, except where the failure to be
so qualified would not have a material adverse effect on the Company
and its subsidiaries, taken as a whole.
(d) All of the outstanding shares of capital stock of, or
other ownership interests in, each of the Company's subsidiaries have
been duly authorized and validly issued and are fully paid and
non-assessable, and are owned, directly or indirectly, by the Company,
free and clear of any security interest, claim, lien, encumbrance or
adverse interest of any nature, other than (i) the stock pledge
securing certain obligations of the Company, Evergreen Media
Corporation of Los Angeles ("Evergreen LA") and the subsidiaries of
Evergreen LA under the Senior Credit Facility (as such term is defined
in the Final Memorandum) and (ii) the pledge by the Company of the
common stock of Evergreen Media Corporation of Texas in connection
with the alternative financing of the Gannett Acquisition (as such
term is defined in the Final Memorandum).
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(e) All the shares of capital stock of the Company
outstanding prior to the issuance of the Shares have been duly
authorized and validly issued and are fully paid and non-assessable
and not subject to any preemptive or similar rights.
(f) The authorized capital stock of the Company (including
the Class A Common Stock and the Convertible Preferred Stock) conforms
as to legal matters to the description thereof contained in the Final
Memorandum.
(g) This Agreement has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of the
Company enforceable in accordance with its terms (except as rights to
indemnity and contribution hereunder may be limited by applicable
law).
(h) Neither the Company nor any of its subsidiaries is in
violation of its respective charter or by- laws (or other
organizational documents) or in default in the performance of any
obligation, agreement or condition contained in any bond, debenture,
note or any other evidence of indebtedness or in any other agreement
or instrument material to the conduct of the business of the Company
and its subsidiaries, taken as a whole, to which the Company or any of
its subsidiaries is a party or by which it or any of its subsidiaries
or their respective property is bound.
(i) The execution, delivery and performance of this
Agreement, the Indenture, the Registration Rights Agreement and the
Certificate of Designation related to the Convertible Preferred Stock
(the "Certificate of Designation"), compliance by the Company with all
the provisions hereof and thereof, the issuance and sale of the
Shares, the issuance of the Debentures upon exchange of the Shares
(assuming that the issuance of the Debentures upon exchange of the
Shares were to take place on the Closing Date (as defined below)) and
the issuance of the Class A Common Stock upon conversion of the Shares
and the Debentures, as applicable, and the consummation of the
transactions contemplated hereby and thereby will not (A) assuming
compliance by the Initial Purchasers with their representations,
warranties and agreements set forth in Section 8 hereof, require any
consent, approval, authorization or other order of any court,
regulatory body, administrative agency or other governmental body,
including the Federal Communications Commission (the "FCC"), except
(x) such as have been obtained or made and are in full force and
effect, (y) in the case of the performance of and compliance with the
Registration
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Rights Agreement, such as will be obtained and made under the Act and
the Trust Indenture Act of 1939, as amended (the "TIA") and (z) as may
be required under Blue Sky laws of the various states; (B) conflict
with or constitute a breach of any of the terms or provisions of, or a
default under, the charter or by-laws (or other organizational
documents) of the Company or any of its subsidiaries; (C) require any
consent or approval (which has not been obtained) of the parties to,
or conflict with or constitute a breach of any of the terms or
provisions of, or a default under, any agreement or other instrument
to which it or any of its subsidiaries is a party or by which it or
any of its subsidiaries or their respective property is bound, except
that the issuance of the Debentures upon exchange of the Shares on the
Closing Date would require obtaining consents under the Senior Credit
Facility (including the Company=s guarantee of Evergreen LA=s
obligations thereunder) and the Chancellor Merger Agreement (as such
term is defined in the Final Memorandum); (D) assuming compliance by
the Initial Purchasers with their representations, warranties and
agreements set forth in Section 8 hereof, violate or conflict with any
laws or administrative regulations, including without limitation the
Communications Act of 1934, as amended, and the rules and regulations
of the FCC thereunder (collectively called the "Communications Act"),
rulings or court decrees applicable to the Company, any of its
subsidiaries or their respective property; (E) result in termination
or revocation of any of the permits, licenses, approvals, orders,
certificates, franchise or authorization of governmental or regulatory
authorities, including those relating to the Communications Act, owned
or held by the Company or any of its subsidiaries in order to conduct
the broadcast operations of the stations owned or operated by them
("Licenses") or result in any other material impairment of the rights
of the holder of any such License; or (F) result in the creation or
imposition of any lien on any asset of the Company or any of its
subsidiaries.
(j) Except as otherwise set forth in the Final Memorandum,
there are no material legal or governmental proceedings pending to
which the Company or any of its subsidiaries is a party or of which
any of their respective property (including without limitation
Licenses) is the subject, and, to the best of the Company's knowledge,
no such proceedings are threatened or contemplated; there are no
material contracts or other documents which would be required to be
described in a prospectus pursuant to the Act that are not described
in the Final Memorandum.
(k) Each of the Company and its subsidiaries is operating in
compliance with all (and has not violated any) laws, regulations,
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administrative orders or rulings or court decrees applicable to it or
to any of its property (including without limitation those relating to
broadcast operations, environmental, safety or similar matters,
federal or state laws relating to the hiring, promotion or pay of
employees, the Employees Retirement Income Security Act or the rules
and regulations promulgated thereunder), except for violations which
will not result in any material adverse change in the business,
prospects, financial condition or results of operations of the Company
and its subsidiaries, taken as a whole.
(l) Each of the Company and its subsidiaries has such
Licenses as are necessary to own, lease and operate its respective
properties and to conduct its business; each of the Company and its
subsidiaries has fulfilled and performed all of its material
obligations with respect to such Licenses and no event has occurred
which allows, or after notice or lapse of time would allow, revocation
or termination thereof or results in any other material impairment of
the rights of the holder of any such permit.
(m) Except as otherwise set forth in the Final Memorandum or
such as are not material to the business, prospects, financial
condition or results of operation of the Company and its subsidiaries,
taken as a whole, the Company and each of its subsidiaries has good
and marketable title, free and clear of all liens, claims,
encumbrances and restrictions except liens for taxes not yet due and
payable, to, and enjoys peaceful and undisturbed possession of, all
property and assets described in the Final Memorandum as being owned
by it.
(n) KPMG Peat Marwick LLP are independent public accountants
with respect to the Company for the purposes of the Act.
(o) The financial statements and related notes included in
the Final Memorandum (other than the Viacom Financials, the WDRQ
Financials, the Riverside Financials, the WLIT Financials, the
KYSR/KIBB Financials, the WDAS Financials, the KKSF/KDFC Financials,
the Chancellor Financials, the Century Financials and WJLB Financials,
each as defined below), present fairly the consolidated financial
position, results of operations and changes in cash flows of the
Company and/or its subsidiaries on the basis stated in the Final
Memorandum at the respective dates or for the respective periods to
which they apply; such statements and related schedules and notes have
been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved,
except as disclosed therein; the pro forma financial information
included in the Final
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Memorandum has been prepared in accordance with the Commission's rules
and guidelines with respect to pro forma financial statements and the
assumptions used in the preparation thereof are, in the Company's
opinion, reasonable; and the other financial and statistical
information and data included in the Final Memorandum is, in all
material respects, accurately presented and prepared on a basis
consistent with such financial statements and the books and records of
the Company.
(p) After due inquiry, the Company has no reason to believe
that (A) the combined financial statements and related notes of WMZQ
Inc. and Viacom Broadcasting East Inc. (the "VIACOM FINANCIALS")
included in the Final Memorandum do not fairly present, as applicable,
the consolidated financial position, results of operations and changes
in cash flows of WMZQ Inc. ("WMZQ") and/or its subsidiaries and Viacom
Broadcasting East Inc. ("VIACOM") and/or its subsidiaries on the basis
stated in the Final Memorandum at the respective dates or for the
respective periods to which they apply or (B) the Viacom Financials
have not been prepared in accordance with generally accepted
accounting principles consistently applied, except as disclosed
therein.
(q) After due inquiry, the Company has no reason to believe
that (A) the financial statements and related notes of WDRQ Inc. (the
"WDRQ FINANCIALS") included in the Final Memorandum do not fairly
present, as applicable, the consolidated financial position, results
of operations and changes in cash flows of WDRQ Inc. ("WDRQ") and/or
its subsidiaries on the basis stated in the Final Memorandum at the
respective dates or for the respective periods to which they apply or
(B) the WDRQ Financials have not been prepared in accordance with
generally accepted accounting principles consistently applied, except
as disclosed therein.
(r) After due inquiry, the Company has no reason to believe
that (A) the combined financial statements and related notes of
Riverside Broadcasting Co., Inc. and WAXQ Inc. (the "RIVERSIDE
FINANCIALS") included in the Final Memorandum do not fairly present,
as applicable, the consolidated financial position, results of
operations and changes in cash flows of Riverside Broadcasting Co.,
Inc. ("RIVERSIDE") and/or its subsidiaries and WAXQ Inc. ("WAXQ")
and/or its subsidiaries on the basis stated in the Final Memorandum at
the respective dates or for the respective periods to which they apply
or (B) the Riverside Financials have not been prepared in accordance
with generally accepted accounting principles consistently applied,
except as disclosed therein.
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(s) After due inquiry, the Company has no reason to believe
that (A) the financial statements and related notes of WLIT Inc. (the
"WLIT FINANCIALS") included in the Final Memorandum do not fairly
present, as applicable, the consolidated financial position, results
of operations and changes in cash flows of WLIT Inc. ("WLIT") and/or
its subsidiaries on the basis stated in the Final Memorandum at the
respective dates or for the respective periods to which they apply or
(B) the WLIT Financials have not been prepared in accordance with
generally accepted accounting principles consistently applied, except
as disclosed therein.
(t) After due inquiry, the Company has no reason to believe
that (A) the combined financial statements and related notes of KYSR
Inc. and KIBB Inc. (the "KYSR/KIBB FINANCIALS") included in the Final
Memorandum do not fairly present, as applicable, the consolidated
financial position, results of operations and changes in cash flows of
KYSR Inc., and KIBB Inc. (collectively, "KYSR/KIBB") on the basis
stated in the Final Memorandum at the respective dates or for the
respective periods to which they apply or (B) the KYSR/KIBB Financials
have not been prepared in accordance with generally accepted
accounting principles consistently applied, except as disclosed
therein.
(u) After due inquiry, the Company has no reason to believe
that (A) the financial statements and related notes of WDAS AM/FM
(station owned and operated by ▇▇▇▇▇▇▇ ▇▇ Acquisition Corp.) (the
"WDAS FINANCIALS") included in the Final Memorandum do not fairly
present, as applicable, the consolidated financial position, results
of operations and changes in cash flows of WDAS AM/FM (station owned
and operated by ▇▇▇▇▇▇▇ ▇▇ Acquisition Corp.) ("WDAS") on the basis
stated in the Final Memorandum at the respective dates or for the
respective periods to which they apply or (B) the WDAS Financials have
not been prepared in accordance with generally accepted accounting
principles consistently applied, except as disclosed therein.
(v) After due inquiry, the Company has no reason to believe
that (A) the financial statements and related notes of KKSF-FM and
KDFC-AM/FM (A Division of the ▇▇▇▇▇ Organization) (the "KKSF/KDFC
FINANCIALS") included in the Final Memorandum do not fairly present,
as applicable, the consolidated financial position, results of
operations and changes in cash flow of KKSF-FM and KDFC-AM/FM (A
Division of the ▇▇▇▇▇ Organization) (collectively, "KKSF/KDFC") on the
basis stated in the Final Memorandum at the respective dates or for
the respective
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periods to which they apply or (B) that the KKSF/KDFC Financials have
not been prepared in accordance with generally accepted accounting
principles consistently applied, except as disclosed herein.
(w) After due inquiry, the Company has no reason to believe
that (A) the financial statements and related notes of Chancellor
Broadcasting Company (the "CHANCELLOR FINANCIALS") included in the
Final Memorandum do not fairly present, as applicable, the
consolidated financial position, results of operations and changes in
cash flow of Chancellor Broadcasting Company ("CHANCELLOR") and/or its
subsidiaries on the basis stated in the Final Memorandum at the
respective dates or for the respective periods to which they apply or
(B) that the Chancellor Financials have not been prepared in
accordance with generally accepted accounting principles consistently
applied, except as disclosed therein.
(x) After due inquiry, the Company has no reason to believe
that (A) the financial statements and related notes of Century Chicago
Broadcasting, L.P. (the "CENTURY FINANCIALS") included in the Final
Memorandum do not fairly present, as applicable, the consolidated
financial position, results of operations and changes in cash flow of
Century Chicago Broadcasting, L.P. ("CENTURY") and/or its subsidiaries
on the basis stated in the Final Memorandum at the respective dates or
for the respective periods to which they apply or (B) that the Century
Financials have not been prepared in accordance with generally
accepted accounting principles consistently applied, except as
disclosed therein.
(y) After due inquiry, the Company has no reason to believe
that (A) the financial statements and related schedules and notes of
WJLB/WMXD Detroit, (the "WJLB/WMXD FINANCIALS") included in the Final
Memorandum do not fairly present , as applicable, the consolidated
financial position, results of operations and changes in cash flow of
WLJB/WMXD, Detroit ("WJLB/WMXD") and/or its subsidiaries on the basis
stated in the Final Memorandum at the respective dates or for the
respective periods to which they apply or (B) that the WJLB/WMXD
Financials have not been prepared in accordance with generally
accepted accounting principles consistently applied, except as
disclosed therein.
(z) The agreements (the "Pending Evergreen Transactions
Agreements") relating to each of the pending transactions described in
the Final Memorandum under the captions "BUSINESS AND PROPERTIES -
RECENT DEVELOPMENTS - CHANCELLOR MERGER" and "BUSINESS AND PROPERTIES
- RECENT DEVELOPMENTS - PENDING EVERGREEN TRANSACTIONS"
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have been duly authorized, executed and delivered by the Company or
one or more of its subsidiaries and constitute the valid and binding
agreements of the Company and/or its subsidiaries (except as such
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and similar laws relating to or affecting
creditors' rights generally or by general equity principles) and,
except as described in the Final Memorandum, the Company has no reason
to believe based on information known to it as of the date of this
Agreement that the transactions contemplated by the Pending
Transactions Agreements will not be consummated on the basis described
therein.
(aa) After due inquiry, the Company has no reason to believe
that the agreements (the "PENDING CHANCELLOR TRANSACTION AGREEMENTS")
relating to each of the pending transactions described in the Final
Memorandum under the captions "BUSINESS AND PROPERTIES - RECENT
DEVELOPMENTS - CHANCELLOR MERGER" and "BUSINESS AND PROPERTIES -
RECENT DEVELOPMENTS - PENDING CHANCELLOR TRANSACTIONS" have not been
duly authorized, executed and delivered by Chancellor or one or more
of its subsidiaries and do not constitute the valid and binding
agreements of Chancellor and/or its subsidiaries (except as such
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and similar laws relating to or affecting
creditors= rights generally or by general equity principles) and,
except as described in the Final Memorandum, the Company has no reason
to believe based on information known to it as of the date of this
Agreement that the transactions contemplated by the Pending Chancellor
Transactions Agreements will not be consummated on the basis described
therein.
(bb) The Company is not and, after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as described in the Final Memorandum, will not be an
"investment company" as such term is defined in the Investment Company
Act of 1940, as amended.
(cc) The Company has complied with all provisions of Section
517.075, Florida Statutes (Chapter 92- 198, Laws of Florida) relating
to the disclosure of business with Cuba.
(dd) The Certificate of Designation has been duly authorized
by the Company and on or prior to the Closing Date will have been duly
executed and delivered by the Company and filed with the Secretary of
State of the State of Delaware; the Shares have been duly authorized
and,
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when issued and delivered to the Initial Purchasers against payment
therefor in accordance with the terms hereof, will be validly issued,
fully paid and nonassessable and the issuance of such Shares will not
be subject to any preemptive or similar rights.
(ee) The shares of Class A Common Stock of the Company to be
issued upon conversion of the Convertible Preferred Stock and the
Debentures have been duly authorized and reserved for issuance upon
such conversion and, when issued upon such conversion in accordance
with the Certificate of Designation and Indenture, respectively, will
be validly issued, fully paid and non-assessable and the issuance of
such shares will not be subject to any preemptive or similar rights.
(ff) The Debentures have been duly authorized by the Company
for issuance and conform to the description thereof in the Final
Memorandum. The Debentures, when executed by the Company and
authenticated by the Trustee in accordance with the provisions of the
Indenture and delivered upon the exchange of the Shares in accordance
with the Certificate of Designation, will have been duly executed,
issued and delivered and will constitute valid and legally binding
obligations of the Company, entitled to the benefits of the Indenture
and enforceable against the Company in accordance with their terms
(except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and similar laws relating to or
affecting creditors' rights generally or by general equity
principles). The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under the
Indenture; the Indenture has been duly authorized by the Company and
meets the requirements for qualification under the TIA and, when
executed and delivered by the Company (assuming the due authorization,
execution and delivery by the Trustee), will constitute a valid and
legally binding agreement of the Company, enforceable against it in
accordance with its terms (except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium and
similar laws relating to or affecting creditors' rights generally or
by general equity principles). The Indenture conforms to the
description thereof in the Final Memorandum.
(gg) The Company has all requisite corporate power and
authority to execute and deliver the Registration Rights Agreement;
the Registration Rights Agreement has been duly authorized by the
Company and, when executed and delivered by the Company (assuming due
authorization, execution and delivery by you), will constitute a valid
and legally binding
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agreement of the Company enforceable against it in accordance with its
terms (except (x) as any rights for indemnity and contribution
thereunder may be limited by applicable law and (y) as such
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and similar laws relating to or affecting
creditors' rights generally or by general equity principles). The
Registration Rights Agreement conforms to the description thereof in
the Final Memorandum.
(hh) The execution and delivery of this Agreement, the
Indenture, the Certificate of Designation and the Registration Rights
Agreement and the sale of the Shares as provided herein will not
involve any prohibited transaction within the meaning of Section 406
of Employee Retirement Income Security Act of 1974, as amended, or
Section 4975 of the Internal Revenue Code of 1986, as amended. The
representation made by the Company in the preceding sentence is made
in reliance upon and subject to the accuracy of, and compliance with,
the representations and covenants made or deemed made by the persons
purchasing the Shares from the Initial Purchasers as set forth in the
Final Memorandum under the section entitled "Transfer Restrictions."
(ii) There are no holders of securities of the Company who,
by reason of the execution by the Company of any of the Certificate of
Designation, the Indenture, the Registration Rights Agreement or this
Agreement or the consummation of the transactions contemplated
therein, have the right to request or demand that the Company register
under the Act any securities held by them, except that holders of
Convertible Preferred Stock, Debentures issuable on exchange thereof
or shares of Class A Common Stock issuable upon conversion thereof
will have registration rights pursuant to the Registration Rights
Agreement.
(jj) Other than this Agreement, there are no contracts,
agreements or understandings between the Company or any of its
subsidiaries and any person that would give rise to a valid claim
against the Company or any of its subsidiaries or any of the Initial
Purchasers for a brokerage commission, finder=s fee or like payment in
connection with the issuance, purchase and sale of Shares.
(kk) None of the Company, any of its subsidiaries or any of
their respective Affiliates (as defined in Rule 501(b) of Regulation D
under the Act) has directly, or through any agent, (i) sold, offered
for sale, solicited offers to buy or otherwise negotiated in respect
of, any "security" (as defined in the Act) which is or could be
integrated with the sale of the
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Securities in a manner that would require the registration under the
Act of the Securities or (ii) engaged in any form of general
solicitation or general advertising (as those terms are used in
Regulation D under the Act) in connection with the offering of the
Securities or in any manner involving a public offering within the
meaning of Section 4(2) of the Act. Assuming the accuracy of the
representations, warranties, and agreements of the Initial Purchasers
in Section 8 hereof, it is not necessary in connection with the offer,
sale and delivery of the Shares to the Initial Purchasers in the
manner contemplated by this Agreement to register any of the
Securities under the Act or to qualify the Indenture under the TIA.
(ll) The Convertible Preferred Stock satisfies the
requirements set forth in Rule 144A(d)(3) under the Act.
(mm) None of the Company, its subsidiaries or any agent
acting on their behalf has taken or will take any action that might
cause this Agreement or the sale of the Shares to violate Regulation
G, T, U or X of the Board of Governors of the Federal Reserve System,
in each case as in effect, or as the same may hereafter be in effect,
on the Closing Date.
(nn) None of the Company or the subsidiaries has taken,
directly or indirectly, any action prohibited by Regulation M under
the Act in connection with the offering of the Shares contemplated
hereby.
3. Purchase, Sale and Delivery of the Shares. On the basis of the
representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the Initial Purchasers, and the Initial Purchasers, acting
severally and not jointly, agree to purchase from the Company, at a price of
$48.25 per share (the "Share Price"), the number of Shares set forth opposite
their respective names on Schedule A hereto.
On the basis of the representations, warranties, agreements and
covenants contained in this Agreement, and subject to its terms and
conditions, the Company agrees to issue and sell to the Initial Purchasers
the Additional Shares, if any, and the Initial Purchasers shall have a one-time
right to purchase, severally and not jointly, up to 500,000 Additional Shares
from the Company at the Share Price. Additional Shares may be purchased solely
for the purpose of covering over-allotments made in connection with the
offering of the Firm Shares. The Initial Purchasers may exercise their right
to purchase Additional Shares in whole or in part by giving written notice
thereof to the Company at any time within 30 days after the date of the Final
Memorandum. You shall give such notice on
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behalf of the Initial Purchasers and the notice shall specify the aggregate
number of Additional Shares to be purchased and the date for payment and
delivery thereof. The date specified in the notice shall be a business day (i)
no earlier than the Closing Date (as hereinafter defined) and (ii) no later
than ten business days after such notice has been given. Each Initial
Purchaser, severally and not jointly, agrees to purchase the number of
Additional Shares (subject to such adjustments to eliminate fractional shares
as you may determine) which bears the same proportion to the total number of
Additional Shares to be purchased as the number of Firm Shares set forth
opposite the name of such Initial Purchaser in Schedule A bears to the total
number of Firm Shares.
Delivery to the Initial Purchasers of the Firm Shares shall take place
at the offices of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇. Payment for the Firm Shares shall be made by wire transfer at 10:00
A.M., New York City time, on June 16, 1997 (the "Closing Date") of same day
funds to such bank account as the Company shall designate. The Closing Date
and the location of delivery of and the form of payment for the Firm Shares may
be varied by agreement between you and the Company.
Delivery to the Initial Purchasers of the Additional Shares to be
purchased by the Initial Purchasers shall take place at the offices of ▇▇▇▇▇
▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇. Payment for the
Additional Shares shall be made by wire transfer at 10:00 A.M., New York City
time, on the date specified in the exercise notice given by you pursuant to
this Section (the "Option Closing Date") of same day funds to such bank account
as the Company may designate. The Option Closing Date and the location of
delivery of and the form of payment for the Additional Shares may be varied by
agreement between you and the Company.
Certificates representing the Shares shall be registered in such names
and issued in such denominations as you shall request in writing not later than
two full business days prior to the Closing Date or the Option Closing Date, as
the case may be. Such certificates shall be made available to you for
inspection not later than 9:30 A.M., New York City time, on the business day
next preceding the Closing Date or the Option Closing Date, as the case may be.
Certificates in definitive form evidencing the Shares shall be delivered to you
on the Closing Date or the Option Closing Date, as the case may be, with any
transfer taxes thereon duly paid by the Company for the respective accounts of
the several Initial Purchasers against payment of the Share Price.
The Company hereby agrees not to offer, sell, contract to sell, grant
any option to purchase, or otherwise dispose of any Common Stock of the Company
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or any securities convertible into or exercisable or exchangeable for such
Common Stock, except to the Initial Purchasers pursuant to this Agreement, and
not to file any registration statement with respect to any such securities
(other than on Form S-8, the Registration Statement and the registration
statement on Form S-4 relating to the Chancellor Merger (as such term is
defined in the Final Memorandum)), in each case for a period of 90 days after
the date of the Final Memorandum, without the prior written consent of Alex.
▇▇▇▇▇ & Sons Incorporated. Notwithstanding the foregoing, during such period
(i) the Company may grant stock options pursuant to the Company=s existing
stock option plans or if the Chancellor Merger is consummated, the existing
stock option plans of Chancellor Broadcasting Company ("Chancellor"), (ii) the
Company may issue shares of its Common Stock upon the exercise of any option or
warrant or the conversion of any security outstanding on the date hereof or
granted pursuant to an existing stock option plan of the Company, or if the
Chancellor Merger is consummated, granted pursuant an existing stock option
plan of Chancellor, (iii) the Company may issue shares of its Class A Common
Stock as consideration for radio station or radio station group acquisitions
including in connection with the Chancellor Merger and (iv) the Company may
honor registration rights obligations assumed by it in connection with the
Chancellor Merger.
4. Offering by the Initial Purchasers. The Initial Purchasers
propose to make an offering of the Shares in a manner consistent with Section 8
hereof at the price and upon the terms set forth in the Final Memorandum, as
soon as practicable after this Agreement is entered into and as in the judgment
of the Initial Purchasers is advisable.
5. Covenants of the Company. The Company covenants and agrees with
the Initial Purchasers:
(a) To advise the Initial Purchasers promptly and, if
requested by them, to confirm such advice in writing, (i) of the
issuance by any state securities commission of any stop order
suspending the qualification or exemption from qualification of the
Securities for offering or sale in any jurisdiction, or the initiation
of any proceedings for such purpose by any state securities commission
or other regulatory authority, and (ii) during the period set forth in
Section 5(d) below, of the happening of any event, or of any
information becoming known, which makes any statement of a material
fact made in the Final Memorandum untrue or which requires the making
of any additions to or changes in the Final Memorandum in order to
make the statements therein, in the light of the circumstances under
which they are made, not misleading. The Company shall use every
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reasonable effort to prevent the issuance of any stop order or order
suspending the qualification or exemption of any of the Securities
under any state securities or Blue Sky laws (and the Initial
Purchasers will (at the sole expense of the Company) cooperate with
the Company in connection therewith), and if at any time any state
securities commission or other regulatory authority shall issue an
order suspending the qualification or exemption of any of the
Securities under any state securities or Blue Sky laws, the Company
shall use every reasonable effort to obtain the withdrawal or lifting
of such order at the earliest possible time, subject in any event to
the provision in Section 5(c) below.
(b) The Company will not amend or supplement the Final
Memorandum or any amendment or supplement thereto of which the Initial
Purchasers shall not previously have been advised and furnished a copy
for a reasonable period of time prior to the proposed amendment or
supplement and as to which the Initial Purchasers shall not have given
their consent. The Company will promptly, upon the reasonable request
of the Initial Purchasers or counsel for the Initial Purchasers, make
any amendments or supplements to the Preliminary Memorandum or the
Final Memorandum that may be necessary or advisable in connection with
the resale of the Shares by the Initial Purchasers.
(c) The Company will cooperate with the Initial Purchasers
in arranging for the qualification of the Securities for offering and
sale under the securities or "Blue Sky" laws of such jurisdictions as
the Initial Purchasers may designate and will continue such
qualifications in effect for as long as may be necessary to complete
the resale of the Securities by the Initial Purchasers; provided,
however, that in connection therewith the Company shall not be
required to qualify as a foreign corporation or to execute a general
consent to service of process or taxation in any jurisdiction in which
it is not now so subject other than as to matters and transactions
relating to the offer and sale of the Shares..
(d) If, at any time prior to the completion of the
distribution by the Initial Purchasers of the Shares, any event occurs
as a result of which the Final Memorandum as then amended or
supplemented would include an untrue statement of a material fact, or
omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, or if for any other reason it is necessary at any time
to amend or supplement the Final Memorandum in order to comply with
applicable law, the Company will promptly notify the Initial
Purchasers thereof and will prepare, at the Company's expense,
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an amendment to the Final Memorandum that corrects such statement or
omission or effects such compliance.
(e) The Company will, without charge, provide to the Initial
Purchasers and to counsel for the Initial Purchasers, as many copies
of the Preliminary Memorandum and the Final Memorandum or any
amendment or supplement thereto as the Initial Purchasers may
reasonably request.
(f) For and during the five-year period ending on the fifth
anniversary of this Agreement, the Company will furnish to the Initial
Purchasers upon their reasonable request (without charge) copies of
all reports and other communications (financial or otherwise)
furnished by the Company to the holders of the Securities or the
Trustee under the Indenture and, as soon as available, copies of any
reports or financial statements furnished to or filed by the Company
with the Commission or any national securities exchange on which any
class of securities of the Company may be listed.
(g) Prior to the Closing Date, the Company will furnish to
the Initial Purchasers, as soon as they have been prepared by or are
available to the Company, a copy of any unaudited interim consolidated
financial statements of the Company for any period subsequent to the
period covered by its most recent financial statements appearing in
the Final Memorandum.
(h) None the Company, any of its subsidiaries or any of
their respective affiliates (as defined in Regulation 501(b) of
Regulation D under the Act) will, directly or through any agent, sell,
offer for sale or solicit offers to buy or otherwise negotiate in
respect of any security (as defined in the Act) the offering of which
security is or would be integrated with the sale of the Securities
contemplated hereby in a manner which would require the registration
of the Securities under the Act, and the Company will take all action
that is appropriate to assure that its offerings of other securities
will not be integrated for purposes of the Act with the offering
contemplated hereby.
(i) The Company will not, and will not permit any of its
subsidiaries to, engage in any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) in
connection with the offering of the Securities or in any manner
involving a public offering within the meaning of Section 4(2) of the
Act.
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(j) For so long as any of the Securities remain outstanding
and are "restricted securities" within the meaning of Rule 144(a)(3)
under the Act, the Company will make available at its expense, upon
request, to any holder or beneficial owner of such Securities and any
prospective purchasers thereof the information specified in Rule
144A(d) (4) under the Act, unless the Company is then subject to
Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended.
(k) In the event that the Company or any of its affiliates
(as defined in Rule 144(a)(1) under the Act) acquires any of the
Securities, the Company or such affiliate will not sell or otherwise
transfer such Securities other than to the Company or its affiliates.
(l) To comply in all material respects with all of its
agreements set forth in the Registration Rights Agreement, and all
agreements set forth in the representation letter of the Company to
the Depository Trust Company relating to the approval of the
Convertible Preferred Stock and the Debentures by the Depository Trust
Company for "book-entry" transfer.
(m) The Company will use its best efforts to (i) permit the
Shares and the Debentures to be designated PORTAL securities in
accordance with the rules and regulations adopted by the NASD relating
to trading in the Private Offerings, Resales and Trading through
Automated Linkages market (the "Portal Market") and (ii) permit the
Shares and Debentures to be eligible for clearance and settlement
through The Depository Trust Company.
(n) The Company will apply the net proceeds from the sale of
the Shares substantially as set forth under "Use of Proceeds" in the
Final Memorandum.
(o) To not take any action prohibited by Regulation M under
the Exchange Act in connection with the offering of the Shares
contemplated hereby.
(p) To use its best efforts to do and perform all things
required or necessary to be done and performed under this Agreement by
the Company prior to the Closing Date or the Option Closing Date, as
the case may be, and to satisfy all conditions precedent to the
delivery of the Shares.
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(q) To reserve and keep available at all times, free of
preemptive rights, shares of Class A Common Stock for the purpose of
enabling the Company to satisfy any obligations to issue shares of
Class A Common Stock upon conversion of the Convertible Preferred
Stock or the Debentures.
6. Expenses. The Company agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance of its
obligations under this Agreement, whether or not the transactions contemplated
herein are consummated or this Agreement is terminated pursuant to Section 11
hereof: (i) the printing, word processing or other production of documents with
respect to such transactions, including any costs of printing the Preliminary
Memorandum and the Final Memorandum and any amendments thereto, and any "Blue
Sky" memoranda, (ii) all arrangements relating to the delivery to the Initial
Purchasers of copies of the foregoing documents, (iii) the fees and
disbursements of the counsel, the accountants and any other experts or advisors
retained by the Company, (iv) the preparation (including printing), issuance
and delivery to the Initial Purchasers of any certificates evidencing the
Shares, including transfer agent=s fees, (v) the qualification of the
Securities under state securities and "Blue Sky" laws, including filing fees
and reasonable fees and disbursements of counsel for the Initial Purchasers
relating thereto, (vi) the expenses of the Company in connection with any
meetings with prospective investors in the Shares, (vii) the fees and expenses
of the Transfer Agent and the Trustee, including fees and expenses of their
counsel, (viii) any fees charged by rating agencies for the rating of the
Shares and the Debentures, (ix) the fees and expenses, if any, incurred in
connection with the admission of the Shares or the Debentures for trading on
any appropriate trading system (such as PORTAL), and (x) the fees and expenses
(including fees and expenses of counsel) of the Company in connection with
approval of the Convertible Preferred Stock and the Debentures by the
Depository Trust Company for "book-entry" transfer. If the issuance and sale
of the Shares provided for herein is not consummated because any condition to
the obligations of the Initial Purchasers set forth in Section 7 hereof is not
satisfied, because this Agreement is terminated pursuant to Section 11 hereof
or because of any failure, refusal or inability on the part of the Company to
perform all obligations and satisfy all conditions on its part to be performed
or satisfied hereunder other than by reason of a default by the Initial
Purchasers, the Company will reimburse the Initial Purchasers upon demand for
all reasonable out-of-pocket expenses (including reasonable counsel fees and
disbursements) that shall have been incurred by the Initial Purchasers in
connection with the proposed purchase and sale of the Shares.
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7. Conditions of the Initial Purchasers= Obligations. The
several obligations of the Initial Purchasers to purchase and pay for the Firm
Shares shall, in their sole discretion, be subject to the following conditions:
(a) The Initial Purchasers shall have received opinions
dated the Closing Date in form and substance satisfactory to the
Initial Purchasers and counsel for the Initial Purchasers, dated the
Closing Date, of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel to the Company, and Weil,
Gotshal & ▇▇▇▇▇▇ or ▇▇▇▇▇▇▇▇▇ & Associates, counsel to Chancellor,
substantially in the form of Exhibits A and B, respectively, hereto.
(b) The Initial Purchasers shall have received an opinion,
dated the Closing Date, of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the
Initial Purchasers, with respect to certain legal matters relating to
this Agreement, and such other related matters as the Initial
Purchasers may require. In rendering such opinion, ▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇ shall have received and may rely upon such certificates and
other documents and information as they may reasonably request to pass
upon such matters. In addition, in rendering their opinion, ▇▇▇▇▇
▇▇▇▇ & ▇▇▇▇▇▇▇▇ may state that their opinion is limited to matters of
New York, Delaware corporate and federal law.
(c) The Initial Purchasers shall have received from KPMG
Peat Marwick LLP, independent public accountants for the Company,
WMZQ, Viacom, WDRQ, Riverside, WAXQ, WLIT, KYSR/KIBB, WDAS and
KKSF/KDFC letters dated, respectively, the date hereof and the Closing
Date, in form and substance satisfactory to the Initial Purchasers and
counsel for the Initial Purchaser, provided, that the letter
delivered on the Closing Date shall use a "cut off date" not earlier
than the date of this Agreement.
(d) The Initial Purchasers shall have received from Coopers
& ▇▇▇▇▇▇▇ L.L.P., independent public accountants for Chancellor
Broadcasting, letters dated, respectively, the date hereof and the
Closing Date, in form and substance satisfactory to the Initial
Purchasers and counsel for the Initial Purchasers, provided, that the
letter delivered on the Closing Date shall use a "cut off date" not
earlier than the date of this Agreement.
(e) The Initial Purchasers shall have received from Price
Waterhouse LLP, independent public accountants for Century, letters
dated, respectively, the date hereof and the Closing Date, in form and
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substance satisfactory to the Initial Purchasers and counsel for the
Initial Purchasers, provided, that the letter delivered on the
Closing Date shall use a "cut off date" not earlier than the date of
this Agreement.
(f) The Initial Purchasers shall have received from ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP, independent public accountants for WJLB/WMXD, letters
dated respectively, the date hereof and the Closing Date in form and
substance satisfactory to the Initial Purchasers and counsel for the
Initial Purchasers, provided, that the letter delivered on the
Closing Date shall use a "cut off date" not earlier than the date of
this Agreement.
(g) All the representations and warranties of the Company
contained in this Agreement shall be true and correct on and as of the
Closing Date with the same force and effect as if made on and as of
the Closing Date.
(h) The issuance and sale of the Shares pursuant to this
Agreement shall not be enjoined (temporarily or permanently) and no
restraining order or other injunctive order shall have been issued or
any action, suit or proceeding shall have been commenced with respect
to this Agreement before any court or governmental authority
(including, without limitation, the FCC).
(i) Since the date of the latest balance sheet included or
incorporated by reference in the Final Memorandum, there shall not
have been any material adverse change, or any development involving a
prospective material adverse change, in the condition, financial or
otherwise, or in the earnings, affairs or business prospects, whether
or not arising in the ordinary course of business, of the Company,
(ii) since the date of the latest balance sheet included or
incorporated by reference in the Final Memorandum there shall not have
been any change, or any development involving a prospective material
adverse change, in the capital stock or in the long-term debt of the
Company from that set forth in the Final Memorandum, (iii) the Company
and its subsidiaries shall have no liability or obligation, direct or
contingent, which is material to the Company and its subsidiaries,
taken as a whole, other than those reflected in the Final Memorandum
and (iv) on the Closing Date you shall have received a certificate
dated the Closing Date, signed by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, in their capacities as the Chief Executive Officer and Chief
Financial Officer of the Company, confirming the matters set forth in
paragraphs (g), (h) and (i) of this Section 7.
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(j) On the Closing Date, the Initial Purchasers shall have
received the Registration Rights Agreement executed by the Company and
such agreement shall be in full force and effect at all times from and
after the Closing Date.
(k) On or before the Closing Date, (i) the Certificate of
Designation shall have been filed with the Secretary of State of the
State of Delaware and (ii) the Initial Purchasers and counsel for the
Initial Purchasers shall have received such further documents,
opinions, certificates and schedules or instruments relating to the
business, corporate, legal and financial affairs of the Company as
they shall have heretofore reasonably requested from the Company.
(l) The Convertible Preferred Stock shall have been rated no
less than B by Standard & Poors Ratings Services.
(m) The Company shall not have failed at or prior to the
Closing Date to perform or comply in any material respect with any of
the agreements herein contained and required to be performed or
complied with by the Company at or prior to the Closing Date.
(n) The Company shall have complied with the provisions with
respect to printing and furnishing of Final Memorandum set forth in
Section 5(e) hereof by the business day next succeeding the date of
this Agreement.
All such documents, opinions, certificates and schedules or instruments
delivered pursuant to this Agreement will comply with the provisions hereof
only if they are reasonably satisfactory in all material respects to the
Initial Purchasers and counsel for the Initial Purchasers. The Company shall
furnish to the Initial Purchasers such conformed copies of such documents,
opinions, certificates and schedules or instruments in such quantities as the
Initial Purchasers shall reasonably request.
The several obligations of the Initial Purchasers to purchase
Additional Shares hereunder are subject to the delivery to you on the Option
Closing Date of such documents as you may reasonably request with respect to
the good standing of the Company, the due authorization and issuance of the
Additional Shares and other matters related to the issuance of such Shares.
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8. Offering of Securities; Restrictions on Transfer. Each of the
Initial Purchasers represents and warrants to, and agrees with, the Company
that (i) it is a Qualified Institutional Buyer (as defined in Rule 144A under
the Act) with such knowledge and experience in financial and business matters
as are necessary in order to evaluate the events and risks of an investment in
the Securities, (ii) it is not acquiring the Convertible Preferred Stock with a
view to any distribution thereof that would violate the Act or the securities
laws of any state, (iii) it has not and will not solicit offers for, or offer
or sell, the Convertible Preferred Stock by any form of general solicitation or
general advertising (as those terms are used in Regulation D under the Act) or
in any manner involving a public offering within the meaning of Section 4(2) of
the Act;(iv) it has and will solicit offers for the Convertible Preferred Stock
only from, and will offer and sell the Convertible Preferred Stock only to (x)
persons whom it reasonably believes to be Qualified Institutional Buyers or, if
any such person is buying for one or more institutional accounts for which such
person is acting as fiduciary or agent, only when such person has represented
to the Initial Purchasers that each such account is a Qualified Institutional
Buyer, to whom notice has been given that such sale or delivery is being made
in reliance on Rule 144A, and, in each case, in transactions under Rule 144A or
(y) a limited number of institutional "accredited investors," as defined in
Rule 501(a)(1), (2), (3) or (7) promulgated under the Act, that prior to their
purchase of the Shares, deliver to such Initial Purchaser a letter containing
the representations and agreements set forth in Annex A to the Final
Memorandum, and (v) it has and will comply with all provisions of the federal
securities laws and the rules and regulations of the Commission thereunder in
connection with the offering of the Shares contemplated herein and the
applicable provisions set forth under the captions "Transfer Restrictions" and
"Private Placement" in the Final Memorandum.
9. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each
Initial Purchaser and each person, if any, who controls any Initial
Purchaser within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, from and against any and all losses, claims,
damages, liabilities and judgments caused by any untrue statement or
alleged untrue statement of a material fact contained in the Final
Memorandum (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) or the Preliminary
Memorandum or caused by any omission or alleged omission to state
therein a material fact or necessary to make the statements therein
not misleading, except insofar as such losses, claims, damages,
liabilities or judgments are caused by any such untrue statement or
omission or alleged untrue statement or omission
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based upon information relating to any Initial Purchaser furnished in
writing to the Company by or on behalf of any Initial Purchaser
through you expressly for use therein; provided, however, that the
foregoing indemnity agreement with respect to the Preliminary
Memorandum shall not inure to the benefit of any Initial Purchaser
from whom the person asserting any such losses, claims, damages or
liabilities purchased Shares, or any person controlling such Initial
Purchaser, if a copy of the Final Memorandum was not sent or given by
or on behalf of such Initial Purchaser to such person at or prior to
the written confirmation of the sale of the Shares to such person, and
if the Final Memorandum would have cured the defect giving rise to
such loss, claim, damage or liability.
(b) In case any action shall be instituted involving any
person in respect of which indemnity may be sought pursuant to Section
9(a), based upon the Preliminary Memorandum or the Final Memorandum or
any amendment or supplement thereto, such person (the "indemnified
party") shall promptly notify the person against whom such indemnity
may be sought (the "indemnifying party") in writing and the
indemnifying party shall assume the defense thereof, including the
employment of counsel reasonably satisfactory to such indemnified
party and payment of all fees and expenses. Any indemnified party
shall have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i)
the employment of such counsel shall have been specifically authorized
in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense and employ counsel or (iii)
the named parties to any such action (including any impleaded parties)
include both the indemnifying party and the indemnified party and such
indemnified party shall have been advised by such counsel that there
may be one or more legal defenses available to it which are different
from or additional to those available to the indemnifying party (in
which case the indemnifying party shall not have the right to assume
the defense of such action on behalf of such indemnified party, it
being understood, however, that the indemnifying party 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 (A) the fees
and
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expenses of more than one separate firm of attorneys (in addition to
any local counsel) for all such Initial Purchasers and all persons, if
any, who control any Initial Purchasers within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, which firm shall be
designated in writing by Alex. ▇▇▇▇▇ & Sons Incorporated and (B) the
fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for the Company, its directors, and
each person, if any, who controls the Company within the meaning of
either such Section, which firm shall be designated in writing by the
Company, and that all such fees and expenses shall be reimbursed as
they are incurred). The indemnifying party shall not be liable for
any settlement of any such action effected without its written consent
but if settled with the written consent of such indemnifying party,
such indemnifying party agrees to indemnify and hold harmless the
indemnified party from and against any loss or liability by reason of
such settlement. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all
liability on claims that are the subject matter of such proceeding.
(c) Each Initial Purchaser agrees, severally and not
jointly, to indemnify and hold harmless the Company, its directors and
any person controlling the Company within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Initial Purchaser but
only with reference to information relating to such Initial Purchaser
furnished in writing by or on behalf of such Initial Purchaser through
you expressly for use in the Preliminary Memorandum or the Final
Memorandum and any amendment or supplement thereto. In case any
action shall be brought against the Company, any of its directors or
any person controlling the Company based on the Preliminary Memorandum
or the Final Memorandum or any amendment or supplement thereto and in
respect of which indemnity may be sought against any Initial
Purchaser, the Initial Purchaser shall have the rights and duties
given to the Company (except that if the Company shall have assumed
the defense thereof, such Initial Purchaser shall not be required to
do so, but may employ separate counsel therein and participate in the
defense thereof but the fees and expenses of such counsel shall be at
the expense of such Initial Purchaser), and the Company, its directors
and any controlling person of the Company shall have the rights and
duties given to the Initial Purchasers by Section 9(b) hereof.
(d) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party in respect of any losses, claims,
damages, liabilities or judgments referred to therein, then each
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indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages, liabilities and
judgments (i) in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying party or parties on the
one hand and the indemnified party or parties on the other hand from
the offering of the Shares or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the
indemnifying party or parties on the one hand and of the indemnified
party or parties on the other in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities
or judgments, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Initial
Purchasers shall be deemed to be in the same proportion as the total
net proceeds from the offering (before deducting expenses) received by
the Company and the total discounts received by the Initial
Purchasers, bear to the total price to the public of the Shares, in
each case as set forth in the table on the cover page of the Final
Memorandum. The relative fault of the Company and the Initial
Purchasers shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or
the omission to state a material fact relates to information supplied
by the Company or the Initial Purchasers and the parties' relative
intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and the Initial Purchasers agree that it would not be just
and equitable if contribution pursuant to this Section 9(d) were determined by
pro rata allocation (even if the Initial Purchasers were treated as one entity
for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or judgments referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 9, no Initial
Purchaser shall be required to contribute any amount in excess of the amount by
which the total price at which the Shares purchased by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such Initial Purchaser 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
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misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Initial Purchasers' obligations to contribute pursuant
to this Section 9(d) are several in proportion to the respective number of
Shares purchased by each of the Initial Purchaser hereunder and not joint.
10. Survival Clause. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Company and the
Initial Purchasers set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement shall remain in full force and effect,
regardless of (i) any investigation made by or on behalf of the Company, any of
its officers or directors, the Initial Purchasers or any controlling person
referred to in Sections 9(a) hereof and (ii) delivery of and payment for the
Shares. The respective agreements, covenants, indemnities and other statements
set forth in Sections 6 and 9 hereof shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement.
11. Termination.
(a) This Agreement may be terminated at any time prior to
the Closing Date by you by written notice to the Company if any of
the following has occurred: (i) since the respective dates as of which
information is given in the Final Memorandum, any material adverse
change or development involving a prospective material adverse change
in the condition, financial or otherwise, of the Company or any of its
subsidiaries or the earnings, affairs, or business prospects of the
Company or any of its subsidiaries, whether or not arising in the
ordinary course of business, which would, in your judgment, make it
impracticable to market or consummate the sale of the Shares on the
terms and in the manner contemplated in the Final Memorandum, (ii) any
outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic conditions or
in the financial markets of the United States or elsewhere that, in
your judgment, is material and adverse and would, in your judgment,
make it impracticable to market the Shares on the terms and in the
manner contemplated in the Final Memorandum, (iii) trading of the
Class A Common Stock shall have been suspended on the NASDAQ National
Market System, (iv) the suspension or material limitation of trading
in securities on the New York Stock Exchange, the American Stock
Exchange or the NASDAQ National Market System or limitation on prices
for securities on any such exchange or National Market System, (v) the
enactment, publication, decree or other promulgation of any federal or
state statute, regulation, rule or order of any court or other
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governmental authority which in your opinion materially and adversely
affects, or will materially and adversely affect, the business or
operations of the Company or any Subsidiary, (vi) the declaration of a
banking moratorium by either federal or New York State authorities or
(vii) the taking of any action by any federal, state or local
government or agency in respect of its monetary or fiscal affairs
which in your opinion has a material adverse effect on the financial
markets in the United States.
(b) Termination of this Agreement pursuant to this Section
11 shall be without liability of any party to any other party except
as provided in Section 10 hereof.
12. Notices. All communications hereunder shall be in writing and,
if sent to the Initial Purchasers, shall be mailed or delivered or telecopied
and confirmed in writing to Alex. ▇▇▇▇▇ & Sons Incorporated, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Syndicate Department, and BT Securities
Corporation, One Bankers Trust Plaza, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention: Corporate Finance Department; if sent to the Company, shall be
mailed or delivered or telecopied and confirmed in writing to the Company at
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention:
Chief Financial Officer.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five business days
after being deposited in the mail, postage prepaid, if mailed; and one business
day after being timely delivered to a next-day air courier.
13. Successors. This Agreement shall inure to the benefit of and be
binding upon the Initial Purchasers, the Company and their respective
successors and legal representatives, and nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any other person 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 being intended to be and being for the sole
and exclusive benefit of such persons and for the benefit of no other person
except that (i) the indemnities of the Company contained in Section 9 of this
Agreement shall also be for the benefit of any person or persons who control
the Initial Purchasers within the meaning of Section 15 of the Act or Section
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20 of the Exchange Act and (ii) the indemnities of the Initial Purchasers
contained in Section 9 of this Agreement shall also be for the benefit of the
directors of the Company, its officers and any person or persons who control
the Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act. No purchaser of Securities from the Initial Purchasers will be
deemed a successor because of such Purchaser.
14. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS
AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAW.
15. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
16. Default of Initial Purchasers. If on the Closing Date or on the
Option Closing Date, as the case may be, any one or more of the Initial
Purchasers shall fail or refuse to purchase the Firm Shares or Additional
Shares, as the case may be, which it or they have agreed to purchase hereunder
on such date and the aggregate number of Firm Shares or Additional Shares, as
the case may be, which such defaulting Initial Purchaser or Initial Purchasers,
as the case may be, agreed but failed or refused to purchase is not more than
one-tenth of the total number of Shares to be purchased on such date by all
Initial Purchasers, each non-defaulting Initial Purchaser shall be obligated
severally, in the proportion which the number of Firm Shares set forth opposite
its name in Schedule A hereto, as the case may be, bears to the total number of
Firm Shares which all the non-defaulting Initial Purchasers, as the case may
be, have agreed to purchase, or in such other proportion as you may specify, to
purchase the Firm Shares or additional Shares, as the case may be, which such
defaulting Initial Purchaser or Initial Purchasers, as the case maybe, agreed
but failed or refused to purchase on such date; provided that in no event shall
the number of Shares which any Initial Purchaser has agreed to purchase
pursuant to Section 3 hereof be increased pursuant to this Section 16 by an
amount in excess of one-ninth of such number of Shares without the written
consent of such Initial Purchaser. If on the Closing Date or on the Option
Closing Date, as the case may be, any Initial Purchaser or Initial Purchasers
shall fail or refuse to purchase Firm Shares or Additional Shares, as the case
may be, and the aggregate number of Firm Shares or Additional Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Shares to be purchased on such date by all Initial Purchasers and
arrangements satisfactory to you and the Company for purchase of such Shares
are not made within 48 hours after such default, this Agreement will terminate
without liability on the part of any non- defaulting Initial Purchasers and the
Company. In any such case which does not result in
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termination of this Agreement, either you or the Company shall have the right
to postpone the Closing Date or the Option Closing Date, as the case may be,
but in no event for longer than seven days, in order that the required changes,
if any, in the Final Memorandum or any other documents or arrangements may be
effected. Any action taken under this paragraph shall not relieve any
defaulting Initial Purchaser from liability in respect of any default of any
such Initial Purchaser under this Agreement.
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If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement among the Company
and the Initial Purchasers.
Very truly yours,
EVERGREEN MEDIA CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
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The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
ALEX. ▇▇▇▇▇ & SONS INCORPORATED
BT SECURITIES CORPORATION
CREDIT SUISSE FIRST BOSTON CORPORATION
▇▇▇▇▇▇▇, SACHS & CO.
NATIONSBANC CAPITAL MARKETS, INC.
TD SECURITIES (USA) INC.
BY: ALEX. ▇▇▇▇▇ & SONS INCORPORATED
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
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SCHEDULE A
INITIAL PURCHASER NUMBER OF SHARES
----------------- ----------------
Alex. ▇▇▇▇▇ & Sons Incorporated . . . . . . . . . . . . . . . . . 916,668
BT Securities Corporation . . . . . . . . . . . . . . . . . . . . 916,668
Credit Suisse First Boston Corporation . . . . . . . . . . . . . 916,666
▇▇▇▇▇▇▇, Sachs & Co. . . . . . . . . . . . . . . . . . . . . . . 916,666
NationsBanc Capital Markets, Inc. . . . . . . . . . . . . . . . . 916,666
TD Securities (USA) Inc. . . . . . . . . . . . . . . . . . . . . 916,666
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,500,000
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EXHIBIT A
FORM OF OPINION OF ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
Capitalized terms herein have the meanings provided therefore in the
Purchase Agreement to which this form of opinion is an Exhibit. The opinion of
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ described in this Exhibit shall be rendered to the Initial
Purchasers at the request of the Company and shall so state therein.
(i) The Company has been duly incorporated, is
validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation and has the
corporate power and authority required to carry on its
business and to own, lease and operate its properties as
described in the Final Memorandum.
(ii) Based solely on certificates of public
officials, the Company is qualified to do business in each
jurisdiction listed in such opinion.
(iii) All the shares of capital stock of the Company
outstanding prior to the issuance of the Shares have been duly
authorized and validly issued and are fully paid,
non-assessable and not subject to any preemptive or, to the
best knowledge of such counsel, similar rights that entitle or
will entitle any person to acquire shares of capital stock
from the Company upon the issuance of the Shares by the
Company.
(iv) The Purchase Agreement has been duly
authorized, executed and delivered by the Company.
(v) The statements in the Final Memorandum under
the captions "Offering Memorandum Summary - Recent
Developments," "Risk Factors - Necessity of Governmental
Reviews and Approvals Prior to Consummation of the Pending
Transactions; Required Dispositions," "Risk Factors - Radio
Industry Subject to Federal Regulation," "Risk Factors -
Antitrust Matters," "Risk Factors - FCC Consent For Viacom
Acquisition," "Risk Factors - Chancellor Viacom Acquisition;
Financing," "Risk Factors - Limitation on Ability to Pay
Dividends," "Business and Properties - Recent Developments,"
"Business and Properties -
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Federal Regulation of Radio Broadcasting Industry," "Business
and Properties - Legal Proceedings," "Management and Board of
Directors - Employment Agreements," "Description of the
Convertible Preferred Stock," "Description of Exchange
Debentures," "Registration Rights; Liquidated Damages,"
"Description of Certain Indebtedness," "Description of Capital
Stock" and "Certain United States Federal Income Tax
Considerations," insofar as such statements constitute a
summary of legal matters, documents or proceedings referred to
therein, are accurate in all material respects.
(vi) The execution, delivery and performance of the
Purchase Agreement, the Indenture, the Registration Rights
Agreement and the Certificate of Designation, compliance by
the Company with all the provisions thereof, the issuance and
sale of the Shares, the issuance of the Debentures upon
exchange of the Shares (assuming that the issuance of the
Debentures upon exchange of the Shares were to take place on
the date hereof), the issuance of Class A Common Stock upon
conversion of the Shares and the Debentures, as applicable,
and the consummation of the transactions contemplated thereby
will not (A) require any consent, approval, authorization or
other order of any Federal or New York State court, regulatory
body, administrative agency or other governmental body,
including the FCC, except (subject to clause (xxii) below, and
assuming reliance by such counsel on the accuracy of the
representations, warranties and agreements referred to
therein) (x) such as have been obtained or made and are in
full force and effect, (y) in the case of the performance of
and compliance with the Registration Rights Agreement, such as
will be obtained and made under the Act and the TIA and (z) as
may be required under Blue Sky laws of the various states; (B)
result in a violation of the Certificate of Incorporation or
by-laws of the Company; (C) require any consent or approval
(which has not been obtained) of the parties to, or result in
a breach of or a default under, any agreement or other
instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries or
their respective properties are bound that is identified to
such counsel in a certificate of an officer of the Company as
being material to the business of the Company and its
subsidiaries, except that the issuance of the Debentures upon
exchange of the Shares on the Closing Date would require
obtaining consents under the Senior Credit Facility (including
the
A-2
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Company's guarantee of Evergreen LA=s obligations thereunder)
and the Chancellor Merger Agreement; or (D) violate or
conflict with any Federal or New York State laws or
administrative regulations (except that for purposes of the
opinion set forth in this clause (vi) such counsel need
express no opinion with respect to federal or New York State
securities laws) including without limitation the
Communications Act, court decrees or rulings known to such
counsel and applicable to the Company or any of its
subsidiaries or their respective properties; or (E) result in
termination or revocation of any of the FCC Licenses listed in
Attachment 1 to this Exhibit A or result in any other material
impairment of the rights of the holder of any such FCC
License; except with respect to (A), (C) and (D), where the
failure to obtain such consent or approval or such breach,
default, violation or conflict could not reasonably be
expected to have a material adverse effect on the Company and
its subsidiaries, taken as a whole, or impair the ability of
the Company and its subsidiaries to consummate the
transactions contemplated hereby.
(vii) To the best knowledge of such counsel, there is
no legal or governmental proceeding pending or threatened to
which the Company or any of its subsidiaries is a party or to
which any of their respective property (including without
limitation Licenses) is subject which is required to be
described in the Final Memorandum and is not so described, and
there is no contract or other document which is required to be
described in the Memorandum; there are no material contracts
or other documents which would be required to be described in
a prospectus pursuant to the Act that are not described in the
Final Memorandum.
(viii) The Company's subsidiaries validly hold the FCC
Licenses listed on Attachment 1 of this Exhibit A, each of
which is in full force and effect on the date hereof, and, to
such counsel's knowledge, based on inquiry of the Company and
review of the FCC's public files, the FCC Licenses constitute
the only material licenses or other authorizations of the FCC
as are required by the Communications Act of 1934, as amended,
and the rules, regulations and orders of the FCC in order to
operate the radio stations listed in Exhibit A of this opinion
on the frequencies and in the communities of the licenses
listed in Exhibit A of this opinion.
A-3
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(ix) To such counsel's knowledge, based solely on
inquiry of officers of the Company and review of the FCC's
public files, none of the FCC Licenses listed in such opinion
is the subject of any proceedings with respect to the possible
revocation of such FCC Licenses.
(x) Each subsidiary listed in such opinion (a
"Significant Subsidiary") has been duly incorporated, is
validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation and has the
corporate power and authority required to carry on its
business and to own, lease and operate its properties as
described in the Final Memorandum.
(xi) All of the outstanding shares of capital stock
of such Significant Subsidiary have been duly authorized and
validly issued and are fully paid and non-assessable, and to
the best knowledge of such counsel, based solely on a review
of each such subsidiary's stock records and inquiries of
officers of the Company, are owned, directly or indirectly, by
the Company, free and clear of any security interest, claim,
lien, encumbrance or adverse interest of any nature other than
the stock pledge securing certain obligations of the Company
and Evergreen LA under the Senior Credit Facility.
(xii) The Company is not and, after giving effect to
the offering and sale of the Shares and the application of the
proceeds thereof as described in the Final Memorandum, will
not be an "investment company" as such term is defined in the
meaning of the Investment Company Act of 1940, as amended.
(xiii) Each document filed pursuant to the Exchange
Act and incorporated by reference in the Final Memorandum
(except for financial statements, pro forma financial
statements and other financial and statistical data included
therein as to which no opinion need be expressed) complied
when so filed as to form in all material respects with the
Exchange Act and the applicable rules and regulations of the
Commission thereunder.
(xiv) Each of the Pending Evergreen Transactions
Agreements has been duly authorized, executed and delivered by
the Company or one or more subsidiaries of the Company and
(other than the Chancellor Merger Agreement as to which it is
A-4
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understood, that no opinion as to enforceability will be
delivered) constitutes the valid and binding agreement of the
Company and/or such subsidiary or subsidiaries party thereto,
subject to (i) the effect of bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to
or affecting the rights or remedies of creditors, (ii) the
effect of general principles of equity, whether enforcement is
considered in a proceeding in equity or law and the discretion
of the court before which any proceeding therefor may be
brought, (iii) the unenforceability under certain
circumstances under law or court decisions of provisions
providing for the indemnification of or contribution to a
party with respect to a liability where such indemnification
or contribution is contrary to public policy and (iv) the
unenforceability of any provision requiring the payment of
attorneys' fees, except to the extent that a court determines
such fees to be reasonable.
(xv) The Debentures have been duly authorized by the
Company for issuance and, when executed by the Company and
authenticated by the Trustee in accordance with the provisions
of the Indenture and delivered upon the exchange of the
Shares, in accordance with the Certificate of Designation,
will have been duly executed, issued and delivered and will
constitute valid and legally binding obligations of the
Company, entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms
(except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and similar laws
relating to or affecting creditors' rights generally or by
general equity principles). The Company has all requisite
corporate power and authority to execute, deliver and perform
its obligations under the Indenture; the Indenture has been
duly authorized by the Company and meets the requirements for
qualification under the TIA and, when executed and delivered
by the Company (assuming the due authorization, execution and
delivery by the Trustee), will constitute a valid and legally
binding agreement of the Company, enforceable against it in
accordance with its terms (except as such enforceability may
be limited by bankruptcy, insolvency, reorganization,
moratorium and similar laws relating to or affecting
creditors' rights generally or by general equity principles).
(xvi) The Company has all requisite corporate power
and authority to execute and deliver the Registration Rights
A-5
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Agreement; the Registration Rights Agreement has been duly
authorized by the Company and, when executed and delivered by
the Company (assuming due authorization, execution and
delivery by the Initial Purchasers), will constitute a valid
and legally binding agreement of the Company enforceable
against it in accordance with its terms (except (x) as any
rights for indemnity and contribution thereunder may be
limited by applicable law and (y) as such enforceability may
be limited by bankruptcy, insolvency, reorganization,
moratorium and similar laws relating to or affecting
creditors' rights generally or by general equity principles).
(xvii) To the best of our knowledge, there are no
holders of securities of the Company who, by reason of the
execution by the Company of any of the Certificate of
Designation, the Indenture, the Registration Rights Agreement
or the Purchase Agreement or the consummation of the
transactions contemplated therein, have the right to request
or demand that the Company register under the Act any
securities held by them, except that holders of Convertible
Preferred Stock, Debentures issuable on exchange thereof or
shares of Class A Common Stock issuable upon conversion
thereof will have registration rights pursuant to the
Registration Rights Agreement.
(xviii) The Certificate of Designation has been duly
authorized, executed and delivered by the Company and filed
with the Secretary of State of the State of Delaware. The
Shares, have been duly authorized, and when issued and
delivered to the Initial Purchasers against payment therefor
as provided by the Purchase Agreement, will have been validly
issued and will be fully paid and nonassessable and the
issuance of such Shares is not subject to any preemptive or,
to the best of such counsel's knowledge, similar rights that
entitle or will entitle any person to acquire shares of
capital stock from the Company upon the issuance thereof by
the Company.
(xix) All the shares of Class A Common Stock of the
Company to be issued upon conversion of the Convertible
Preferred Stock and the Debentures have been duly authorized
and reserved for issuance upon such conversion and, when
issued upon such conversion in accordance with the Certificate
of Designation or the Indenture, respectively, will be validly
issued, fully paid and
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non-assessable and the issuance of such securities will not be
subject to any preemptive or, to the best of such counsel's
knowledge, similar rights that entitle or will entitle any
person to acquire shares of capital stock from the Company
upon the issuance thereof by the Company.
(xx) The Convertible Preferred Stock satisfies the
requirements set forth in Rule 144A(d)(3) under the Act.
(xxi) Assuming the statements made therein are true
and correct, the Final Memorandum, as of its date, and each
amendment or supplement prepared by the Company, if any,
thereto, as of its date (except for the financial statements,
including the notes thereto, and other financial and
statistical data included therein, as to which no opinion need
to expressed), comply as to form in all material respects with
the requirements of, Rule 144A(d)(4) under the Act.
(xxii) Assuming the accuracy of (1) the
representations, warranties and agreements of the Company in
Sections 2(kk), 2(ll), 5(h), 5(i), 5(j) and 5(k) of the
Purchase Agreement, (2) the representations, warranties and
agreements of the Initial Purchasers in Section 8 of the
Purchase Agreement and (3) the representations, warranties and
agreements made in accordance with the Purchase Agreement and
Final Memorandum of the purchasers to whom the Initial
Purchasers initially resell Shares (including in the letters
delivered or to be delivered by accredited investors (the form
of which is attached as Annex A to the Final Memorandum), it
is not necessary in connection with the offer, sale and
delivery of the Shares to the Initial Purchasers under the
Purchase Agreement or in connection with the initial resale of
the Shares by the Initial Purchasers in the manner
contemplated by the Purchase Agreement and the Final
Memorandum to register the Securities under the Act or to
qualify the Indenture under the TIA; provided that such
counsel need express no opinion as to when and under what
circumstances the Securities may be otherwise resold.
We have participated in conferences with directors, officers and other
representatives of the Company, representatives of the independent public
accountants for the Company and representatives of the Initial Purchasers at
which the contents of the Final Memorandum and related matters were discussed
and, although we are not passing upon, and do not assume any responsibility
for,
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the accuracy, completeness or fairness of the statements contained in the Final
Memorandum and have not made any independent check or verification thereof
(other than as stated in clause (v), (viii), (ix) and (xi) above), during the
course of such participation (relying as to materiality to a large extent upon
the statements of officers and other representatives of the Company), no facts
came to our attention that caused us to believe that the Final Memorandum, as
of its date or as of the Closing Date, contained an untrue statement of a
material fact or omitted to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; it being understood that we express no belief with
respect to the financial statements, pro forma financial statements and other
financial and statistical data included or incorporated by reference in the
Final Memorandum.
Any statement herein that is qualified by "to the best of our
knowledge" or a similar phrase, is intended to indicate that those attorneys in
the firm who have rendered legal services to the Company in connection with the
offering of the Shares, the Completed Evergreen Transactions, the Chancellor
Merger, the Pending Evergreen Transactions and the Senior Credit Facility (each
as defined in the Final Memorandum), and in connection with matters relating to
the FCC and the HSR Act (as defined in the Final Memorandum) do not have
current actual knowledge of the inaccuracy of such statement and that, except
as otherwise expressly indicated, such counsel has not undertaken any
independent investigation to determine the accuracy of such statement.
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EXHIBIT B
FORM OF OPINION OF WEIL, GOTSHAL & ▇▇▇▇▇▇
Capitalized terms herein have the meanings provided therefore in the
Purchase Agreement to which this form of opinion is an Exhibit. The opinion of
Weil, Gotshal & ▇▇▇▇▇▇ and/or ▇▇▇▇▇▇▇▇▇ Associates described in this Exhibit
shall be rendered to you at the request of the Company and shall so state
therein.
(i) Each of the Pending Chancellor Agreements has
been duly authorized, executed and delivered by Chancellor or
one or more of its subsidiaries and constitutes the valid and
binding agreements of Chancellor and/or its subsidiaries
enforceable against Chancellor or such subsidiary or
subsidiaries, as the case may be (except as such
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and similar laws relating to or
affecting creditors= rights generally or by general equity
principles). Chancellor has been duly incorporated, is
validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation and has the
corporate power and authority required to carry on its
business and to own, lease and operate its properties as
described in the Final Memorandum.
B-1