Exhibit (d)(2)
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Investment Agreement
dated as of
July 16, 2000
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TABLE OF CONTENTS
Page
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ARTICLE I
Sale of Shares.............................................................................................. 1
Section 1.1 Amendment to Certificate Of Incorporation................................................. 1
Section 1.2 Sale of Common Stock...................................................................... 1
Section 1.3 Closing................................................................................... 1
Section 1.4 Additional Documents...................................................................... 2
ARTICLE II
Representations and Warranties of the Company............................................................... 2
Section 2.1 Organization, Qualifications and Power.................................................... 2
Section 2.2 Authorization of Agreements; No Conflicts................................................. 2
Section 2.3 Validity.................................................................................. 2
ARTICLE III
Representations and Warranties of Purchasers................................................................ 2
Section 3.1 Investor Qualifications................................................................... 3
Section 3.2 Investment................................................................................ 3
Section 3.3 Rule 144.................................................................................. 3
Section 3.4 No Public Market.......................................................................... 3
Section 3.5 Authorization............................................................................. 3
Section 3.6 Brokers or Finders........................................................................ 3
Section 3.7 Organization and Power.................................................................... 4
ARTICLE IV
Miscellaneous............................................................................................... 4
Section 4.1 Compliance with Covenants and Performance of Obligations.................................. 4
Section 4.2 Amendments................................................................................ 4
Section 4.3 Survival of Representations and Warranties................................................ 4
Section 4.4 Successors and Assigns.................................................................... 4
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Section 4.5 Severability.............................................................................. 4
Section 4.6 Descriptive Headings...................................................................... 4
Section 4.7 Notices................................................................................... 4
Section 4.8 Third Party Beneficiaries................................................................. 6
Section 4.9 Governing Law............................................................................. 6
Section 4.10 Schedules and Exhibits................................................................... 6
Section 4.11 Final Agreement.......................................................................... 6
Section 4.12 Execution in Counterparts................................................................ 6
Section 4.13 JURISDICTION; VENUE; FORUM NON CONVENIENS................................................ 6
Section 4.14 WAIVER OF JURY TRIAL..................................................................... 7
Section 4.15 Termination.............................................................................. 7
EXHIBITS
Exhibit A Closing
Exhibit B Form of Amended and Restated Certificate of Incorporation
Exhibit C Form of Registration Rights Agreement
Exhibit D Form of Amended and Restated Stockholders' Agreement
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INVESTMENT AGREEMENT
This Investment Agreement (this "Agreement") dated as of July
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16, 2000 is among Career Holdings, Inc., a Delaware corporation (the "Company"),
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Tribune Company, a Delaware corporation ("TC"), and ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc., a
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Delaware corporation ("KR" and together with TC, the "Purchasers").
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RECITALS
WHEREAS, in order to finance the Company's growth, the Company
desires to issue and sell to the Purchasers, and the Purchasers desire to
purchase from the Company, as set forth on Exhibit A hereto, an aggregate of
30,750,000 shares (the "Shares") of the authorized and unissued shares of Common
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Stock, par value $.01 per share, of the Company (the "Common Stock"), all on the
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terms and subject to the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows:
ARTICLE I
Sale of Shares
Section 1.1 Amendment to Certificate Of Incorporation.
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Purchasers agree that, prior to the Closing (as defined below), they will cause
the Certificate of Incorporation of the Company to be amended and restated in
the form attached hereto as Exhibit B.
Section 1.2 Sale of Common Stock. Subject to the terms and
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conditions set forth herein and in reliance upon the representations and
warranties of the Company set forth herein, the Company agrees to issue and sell
to each Purchaser, free and clear of any liens, claims, charges and encumbrances
whatsoever, and each Purchaser agrees to purchase from the Company at the
Closing (as defined below) the number of shares of Common Stock for the purchase
price set forth opposite such Purchaser's name in Exhibit A hereto. The Closing
shall take place at the offices of Sidley & Austin, Bank One Plaza, ▇▇ ▇.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇.
Section 1.3 Closing. The Closing shall take place on or prior
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to the date that is two business days prior to the date that the shares of
common stock, par value $.001 per share ("Target Common Stock"), of
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CareerBuilder, Inc., a Delaware corporation ("CareerBuilder"), are required to
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be accepted for payment by CB Acquisition Corp., a Delaware corporation and a
wholly-owned subsidiary of the Company ("Sub") pursuant to Sub's offer to
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purchase all outstanding shares of Target Common Stock commenced pursuant to the
Agreement and Plan of Merger dated July 16, 2000 (the "Merger Agreement") among
the Company, Sub and CareerBuilder (the "Closing"). At the Closing, the Company
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will issue and sell to each Purchaser, against the payment by such Purchaser of
the purchase price therefor by wire transfer of immediately available funds to
an account which has been designated in writing by the
Company, duly registered in the name of the Purchaser, the number of Shares set
forth opposite such Purchaser's name on Exhibit A hereto.
Section 1.4 Additional Documents. At the Effective Time (as defined in the
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Merger Agreement), the Company and Purchasers agree to execute and deliver the
Registration Rights Agreement in the form attached hereto as Exhibit C and the
Amended and Restated Stockholders' Agreement in the form attached hereto as
Exhibit D.
ARTICLE II
Representations and Warranties of the Company
The Company hereby represents and warrants to the Purchasers that:
Section 2.1 Organization, Qualifications and Power. The Company is a
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corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware. The Company has the corporate power and authority
to own and hold its properties and to carry on its business as now conducted and
as proposed to be conducted. The Company has the corporate power and authority
to execute, deliver and perform this Agreement.
Section 2.2 Authorization of Agreements; No Conflicts. (a) The execution,
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delivery and performance by the Company of this Agreement and the issuance and
sale of the Shares (i) have been duly authorized by all requisite corporate
action, (ii) does not violate (w) any provision of law, (x) any order of any
court or other agency of government, (y) the Company's certificate of
incorporation, or (z) any provision of any indenture, agreement or other
instrument to which the Company or any of its properties or assets is bound,
(iii) does not result in a breach of or constitute a default under any such
order, indenture, agreement or other instrument, and (iv) does not result in the
creation or imposition of any lien, charge, restriction, claim or encumbrance of
any nature whatsoever upon any of the properties or assets of the Company.
(b) On or before the date of Closing, the Shares will have been duly
authorized and, when issued in accordance with this Agreement, will be validly
issued, fully paid and nonassessable and will be free and clear of all liens,
charges, restrictions, claims and encumbrances.
Section 2.3 Validity. This Agreement has been duly executed and delivered
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by the Company and constitutes its legal, valid and binding obligation,
enforceable against the Company in accordance with its terms.
ARTICLE III
Representations and Warranties of Purchasers
In order to induce the Company to enter into this Agreement and issue,
sell and deliver the Shares, each Purchaser hereby severally represents and
warrants as follows:
2
Section 3.1 Investor Qualifications. Purchaser is an "accredited"
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investor as such term is defined in Regulation D promulgated pursuant to the
Securities Act (as defined below). Purchaser, by reason of Purchaser's business
or financial experience, directly or indirectly, is capable of evaluating the
merits and risks of Purchaser's investment in the Company, and has the capacity
to protect Purchaser's own interests in connection with the purchase of the
Shares.
Section 3.2 Investment. Purchaser is acquiring the Shares for
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investment for Purchaser's own account, not as a nominee or agent, and not with
the view to, or for resale in connection with, any distribution thereof.
Purchaser understands that the issuance and sale of the Shares has not been, and
will not be, registered under the Securities Act of 1933 (the "Securities Act")
by reason of a specific exemption from the registration provisions of the
Securities Act that depends upon, among other things, the bona fide nature of
the investment intent and the accuracy of Purchaser's representations as
expressed herein. Purchaser has not been formed for the specific purpose of
acquiring the Shares.
Section 3.3 Rule 144. Purchaser acknowledges that the Shares must be
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held indefinitely unless subsequently registered under the Securities Act or an
exemption from such registration is available. Purchaser is aware of the
provisions of Rule 144 promulgated under the Securities Act, which permit
limited resale of shares purchased in a private placement subject to the
satisfaction of certain conditions.
Section 3.4 No Public Market. Purchaser understands that no public
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market now exists for the Common Stock or any other securities issued by the
Company, that the Company has made no assurances that a public market will ever
exist for the Common Stock and that, even if such a public market exists at some
future time, the Company may not then be satisfying the current public
information requirements of Rule 144.
Section 3.5 Authorization. The execution, delivery and performance by
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the Purchaser of this Agreement and the execution, delivery and performance by
the Company of this Agreement and the Merger Agreement (i) have been duly
authorized by all requisite corporate action of the Purchaser, (ii) does not
violate any provision of law applicable to the Purchaser, any order of any court
or other agency of government applicable to the Purchaser or any provisions of
any indenture, agreement or other instrument to which the Purchaser or any of
its properties or assets is bound, except as would not have a material adverse
effect on the Purchaser, or Purchaser's certificate of incorporation, (iii) does
not result in a breach of or constitute a default under any indenture, agreement
or other instrument to which the Purchaser or any of its properties or assets is
subject, except as would not have a material adverse effect on the Purchaser,
and (iv) does not result in the creation or imposition of any lien, charge,
restriction, claim or encumbrance of any nature whatsoever upon any of the
properties or assets of the Purchaser, except as would not have a material
adverse effect on the Purchaser. This Agreement has been duly executed and
delivered by the Purchaser, and constitutes its valid binding obligation,
enforceable against the Purchaser in accordance with its terms.
Section 3.6 Brokers or Finders. Purchaser has not incurred, and will
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not incur, directly or indirectly, as a result of any action taken by Purchaser,
any liability for brokerage or finders' fees or agents' commissions or any
similar charges in connection with this Agreement.
3
Section 3.7 Organization and Power. Purchaser is a corporation or
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other entity duly formed, validly existing and in good standing under the laws
of the jurisdiction of its incorporation or formation. Purchaser has the
requisite power and authority to execute, deliver and perform this Agreement.
ARTICLE IV
Miscellaneous
Section 4.1 Compliance with Covenants and Performance of Obligations.
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TC and KR each agree to take or cause to be taken all actions necessary to cause
the Company to comply with its covenants and agreements, and to perform all of
its obligations, contained in the Merger Agreement.
Section 4.2 Amendments. Except as otherwise expressly provided herein,
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the provisions of this Agreement may be amended only by the written consent of
the parties hereto. No course of dealing between the Company and any Purchaser
or any delay in exercising any rights hereunder will operate as a waiver of any
rights of that party.
Section 4.3 Survival of Representations and Warranties. All
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representations and warranties contained herein or made in writing by any party
in connection herewith will survive the execution and delivery of this Agreement
and Closing.
Section 4.4 Successors and Assigns. Except as otherwise expressly
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provided herein, all covenants and agreements contained in this Agreement by or
on behalf of any party hereto will bind and inure to the benefit of the
respective successors, assigns, heirs, beneficiaries and estates of the parties
hereto, whether so expressed or not.
Section 4.5 Severability. Whenever possible, each provision of this
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Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
Section 4.6 Descriptive Headings. The descriptive headings of this
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Agreement are inserted for convenience of reference only and do not constitute a
part of this Agreement.
Section 4.7 Notices. Any notices required, desired or permitted to be
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given hereunder, shall be delivered personally, sent by overnight courier or
mailed, registered or certified mail, return receipt requested, to the following
addresses (or to such other address as each party may specify in a notice given
hereunder) or transmitted by facsimile transmission (with such transmission
promptly confirmed by writing delivered personally, by overnight courier or
mailed as provided in this Section 4.7) and shall be deemed to have been
received on the day of personal delivery, one business day after delivery to the
overnight courier service, four business days after such mailing or, in the case
of facsimile transmission, when received:
4
If to TC, to:
Tribune Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Sidley & Austin
Bank One Plaza
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to KR, to:
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.
▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇/▇▇/ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP
One Federal Reserve Bank Building
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Company, to:
Career Holdings, Inc.
c/o Tribune Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
5
with a copy to:
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.
▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
Section 4.8 Third Party Beneficiaries. The Company, TC and KR hereby
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acknowledge that, as contemplated by the Merger Agreement, CareerBuilder is an
express third-party beneficiary to the obligations of the parties hereunder. TC
and KR agree to comply with Sections 6.7 and 6.8 of the Merger Agreement as if
they were parties thereto. The parties agree that for purposes of Section 6.7(c)
of the Merger Agreement the term "Material Adverse Effect on Parent" shall be
deemed to refer to TC and KR taken together.
Section 4.9 Governing Law. THE VALIDITY, MEANING AND EFFECT OF THIS
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AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF DELAWARE APPLICABLE
TO CONTRACTS MADE AND TO BE PERFORMED IN THAT STATE.
Section 4.10 Schedules and Exhibits. All Schedules and Exhibits here
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to are an integral part of this Agreement.
Section 4.11 Final Agreement. This Agreement, together with those
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documents which are exhibits hereto, constitute the final agreement of the
parties concerning the matters referred to herein and therein, and supersedes
all prior and contemporaneous agreements and understandings.
Section 4.12 Execution in Counterparts. This Agreement may be executed
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in any number of counterparts, each of which when so executed and delivered
shall be deemed an original, and such counterparts together shall constitute one
instrument.
Section 4.13 JURISDICTION; VENUE; FORUM NON CONVENIENS. (a) THE
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COMPANY AND EACH PURCHASER HEREBY IRREVOCABLY SUBMITS IN ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR ANY OTHER INSTRUMENT,
DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH AND THE
TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, WHETHER ARISING IN CONTRACT, TORT,
EQUITY OR OTHERWISE, TO THE EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT
LOCATED IN THE STATE OF ILLINOIS OR DELAWARE AND WAIVES ANY AND ALL OBJECTIONS
TO JURISDICTION THAT IT MAY HAVE UNDER THE LAWS OF THE UNITED STATES OR OF ANY
STATE.
(b) THE COMPANY AND EACH PURCHASER WAIVE ANY OBJECTION THAT IT MAY
HAVE (INCLUDING, WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR
BASED ON FORUM NON CONVENIENS) TO THE LOCATION OF THE COURT IN WHICH ANY
PROCEEDING IS COMMENCED IN ACCORDANCE WITH THIS SECTION 4.13.
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Section 4.14 WAIVER OF JURY TRIAL. THE COMPANY AND EACH PURCHASER
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WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY DISPUTE, WHETHER SOUNDING IN CONTRACT,
TORT, OR OTHERWISE, BETWEEN ANY OF THE PARTIES HERETO ARISING OUT OF OR RELATED
TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY OTHER INSTRUMENT,
DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH. ANY PARTY
HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY
COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF
THEIR RIGHT TO TRIAL BY JURY.
Section 4.15 Termination. This Agreement shall not be terminated for
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any reason so long as the Merger Agreement is in effect and has not been
terminated. In the event of any purported termination of this Agreement by TC or
KR without the consent of CareerBuilder at a time when the Merger Agreement has
not been terminated, CareerBuilder shall have the right to terminate the Merger
Agreement and the Purchasers shall cause the Company to consent to such
termination.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of July 16, 2000.
Career Holdings, Inc.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President and Assistant
Secretary
TRIBUNE COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President, Tribune
Interactive, Inc.
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President
8
EXHIBIT A TO
INVESTMENT AGREEMENT
Number of Shares of
Name of Purchaser Common Stock Purchase Price
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Tribune Company 15,375,000 $123,000,000
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. 15,375,000 $123,000,000
A-1
EXHIBIT B TO
INVESTMENT AGREEMENT
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
CAREER HOLDINGS, INC.
FIRST: The name of the corporation (which is hereinafter
referred to as the "Corporation") is Career Holdings, Inc.
SECOND: The address of the Corporation's registered office in
the State of Delaware is The Corporation Trust Company, The Corporation Trust
Center, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of New Castle.
THIRD: The purpose of the Corporation is to engage in any
lawful act or activity for which corporations may be organized under the General
Corporation Law of Delaware.
FOURTH: The total number of shares of all classes of capital
stock which the Corporation shall have the authority to issue is 77,800,000
shares of common stock with a par value of $.01 per share
FIFTH: In furtherance and not in limitation of the powers
conferred by statute, the Board of Directors is expressly authorized to make,
alter or repeal the By-laws of the Corporation, subject to any specific
limitation on such power contained in any By-laws adopted by the stockholders.
Elections of directors need not be by written ballot unless the By-laws of the
Corporation so provide.
SIXTH: A director of the Corporation shall not be personally
liable to the Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the Corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the General Corporation Law
of Delaware, or (iv) for any transaction from which the director derived an
improper personal benefit. If the General Corporation Law of Delaware is amended
to authorize corporate action further eliminating or limiting the personal
liability of directors, then the liability of a director of the Corporation
shall be eliminated or limited to the fullest extent permitted by the General
Corporation Law of Delaware, as so amended. Any repeal or modification of this
Article Seventh by the stockholders of the Corporation shall not adversely
affect any right or protection of a director of the Corporation existing at the
time of such repeal or modification.
SEVENTH: Each person who is or was a director or officer of
the Corporation, and each person who serves or served at the request of the
Corporation as a director or officer of another enterprise, shall be indemnified
by the Corporation in accordance with, and to the fullest
B-1
extent authorized by, the General Corporation Law of Delaware as it may be in
effect from time to time.
THE UNDERSIGNED, being the President of the Corporation, has
executed this Amended and Restated Certificate of Incorporation on ______ __,
2000.
By: __________________________
Name:
Title:
B-2
EXHIBIT C TO
INVESTMENT AGREEMENT
FORM OF
REGISTRATION RIGHTS AGREEMENT
C-1
REGISTRATION RIGHTS AGREEMENT
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This Registration Rights Agreement (this "Agreement"), dated as of
__________ __, 2000 is by and among Career Holdings, Inc., a Delaware
corporation (the "Corporation"), and the stockholders listed on the signature
page hereto (being collectively referred to as the "Stockholders").
RECITALS
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WHEREAS, the Stockholders own an aggregate of _________ shares of
common stock of the Corporation, par value $.01 per share (the "Common Stock");
and
WHEREAS, the Corporation deems it desirable for the Corporation to
grant certain registration rights to the Stockholders.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. Definitions. As used in this Agreement:
(a) "Commission" means the Securities and Exchange Commission or
any other federal agency at the time administering the Securities Act.
(b) "Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.
(c) "Person" means a natural person, a partnership, a
corporation, a limited liability company, an association, a joint stock company,
a trust, a joint venture, an unincorporated organization or a governmental
entity or any department, agency or political subdivision thereof.
(d) "Common Stock Approval" means the approval of holders of at
least a majority of the outstanding Registrable Shares.
(e) "KR" means ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc., a Delaware corporation,
or its successors or permitted assigns.
(f) "Registrable Shares" means at any time (i) any shares of
Common Stock held by any Stockholder; and (ii) any shares of Common Stock held
by any proper transferee of any Stockholder who has agreed to be bound by the
terms and conditions of this Agreement; provided, that, Registrable Shares shall
not include any shares (i) the sale of which has been registered pursuant to the
Securities Act and which shares have been sold pursuant to such registration or
(ii) which have been sold to the public pursuant to Rule 144 of the Commission
under the Securities Act. For purposes of this Agreement, a Person will be
deemed to be a holder of Registrable Shares whenever such Person has the then
existing right to acquire
such Registrable Shares (by exercise, conversion or otherwise), whether or not
such acquisition has actually been effected.
(g) "Registration Expenses" has the meaning ascribed to it in
Section 6 of this Agreement.
(h) "Securities Act" means the Securities Act of 1933, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.
(i) "Stockholders Agreement" means the Stockholders Agreement
dated as of the date hereof among the parties hereto and the other parties named
therein as such agreement may be amended from time to time.
(j) "TC" means Tribune Company, a Delaware corporation, or its
successors or permitted assigns.
2. Demand Registrations. (a) Requests for Registration.
(i) Any time after the later of (i) the fourth anniversary of
this Agreement and (ii) the Corporation's initial public offering of Common
Stock the ("IPO"), each of KR and TC may request registration under the
Securities Act of all or part of their Registrable Shares for sale in the manner
specified in such request; provided, that each of TC and KR shall have the right
to request registration under this Section 2(a) no more than 2 times each.
Within 10 days after receipt of any request pursuant to this Section 2(a), the
Corporation will give written notice of such request to all other holders of
Registrable Shares and will include in such registration (as part of such Demand
Registration (as defined herein)) all Registrable Shares with respect to which
the Corporation has received written requests for inclusion therein within 15
days after the receipt of the Corporation's notice. All registrations requested
pursuant to this Section 2(a)(i) shall be referred to herein as "Demand
Registrations."
(ii) A registration will not count as a Demand Registration until
it has become effective and unless the holder(s) of Registrable Shares that
initiated such Demand Registration is able to register and sell at least 80% of
the Registrable Shares requested to be included in such registration.
(b) Priority on Demand Registrations. The Corporation and the
holders of a majority of the Registrable Shares to be sold pursuant to a Demand
Registration shall, upon mutual agreement, designate the managing underwriters,
if applicable, for such offering. If the managing underwriters advise the
Corporation in writing that in their opinion the number of Registrable Shares
and other securities requested to be included (x) creates a substantial risk
that the price per share in such registration will be materially and adversely
affected or (y) exceeds the number of Registrable Shares and other securities
which can reasonably be sold in such offering, then the Corporation will include
in such registration, prior to the inclusion of any securities which are not
Registrable Shares, the number of Registrable Shares requested to be included
which in the opinion of such underwriters can be sold, pro rata among the
respective holders on the basis of the number of Registrable Shares owned by
such holders.
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(c) Restrictions on Registrations. The Corporation may postpone
for up to 90 days the filing or the effectiveness of a registration statement
for a Demand Registration if the Corporation reasonably believes that such
Demand Registration will have a material adverse effect on any proposal or plan
by the Corporation to engage in any financing, acquisition of assets or any
merger, consolidation, tender offer or other significant transaction; provided,
that, the Corporation shall have the right to postpone such filing or
effectiveness only one time during any period of 12 consecutive months.
3. Piggyback Registrations. (a) Right to Piggyback. At any time
after the IPO, whenever the Corporation proposes to register any of its
securities under the Securities Act (including, without limitation, a Demand
Registration) and the registration form to be used may be used for the
registration of Registrable Shares (a "Piggyback Registration"), the Corporation
will give prompt written notice to all holders of Registrable Shares of its
intention to effect such a registration (which notice shall be given not less
than 30 days prior to the date the registration statement is to be filed) and,
subject to the terms hereof, will include in such registration all Registrable
Shares with respect to which the Corporation has received written requests for
inclusion therein within 15 days after the receipt of the Corporation's notice.
(b) Priority on Primary Registrations. If a Piggyback
Registration is an underwritten primary registration on behalf of the
Corporation, and the managing underwriters advise the Corporation in writing
that in their opinion the number of securities requested to be included in such
registration (i) creates a substantial risk that the price per share in such
registration will be materially and adversely affected, or (ii) exceeds the
number which can reasonably be sold in such offering, then the Corporation will
include in such registration (x) first, the securities the Corporation proposes
to sell, (y) second, the Registrable Shares requested to be included in such
registration which in the opinion of such underwriters can be sold, pro rata
among the holders of such Registrable Shares on the basis of the number of
Registrable Shares owned by such holders, and (z) third, other securities
requested to be included in such registration.
(c) Priority on Secondary Registrations. If a Piggyback
Registration is an underwritten secondary registration on behalf of holders of
the Corporation's securities, and the managing underwriters advise the
Corporation in writing that in their opinion the number of securities requested
to be included in such registration (i) creates a substantial risk that the
price per share in such registration will be materially and adversely affected,
or (ii) exceeds the number which can reasonably be sold in such offering, then
the Corporation will include in such registration (x) first, the securities
requested to be included therein by the holders requesting such registration,
(y) second, the Registrable Shares requested to be included in such registration
which in such opinion of such underwriters can be sold, pro rata among the
holders of such Registrable Shares on the basis of the number of Registrable
Shares owned or deemed to be owned by such holders, and (z) third, other
securities requested to be included in such registration.
(d) Other Registrations. If the Corporation has previously
received a request for a Demand Registration pursuant to Section 2 or has
previously filed a registration statement with respect to Registrable Securities
pursuant to this Section 3, and if such previous request or registration has not
been withdrawn or abandoned, the Corporation will not file or
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cause to be effected any other registration of any of its equity securities or
securities convertible or exchangeable into or exercisable for its equity
securities under the Securities Act (except on Form ▇-▇, ▇▇▇▇ ▇-▇ or any
successor forms), whether on its own behalf or at the request of any holder or
holders of such securities, until a period of 90 days has elapsed from the
effective date of such Demand Registration or previous registration.
4. Holdback Agreements. (a) Each of the holders of Registrable
Shares agrees, if the managing underwriters request such agreement, not to
effect any public sale or distribution of equity securities of the Corporation,
or any securities convertible into or exchangeable or exercisable for such
securities, during the seven days prior to and the 90-day period beginning on
the effective date of any underwritten Demand Registration or underwritten
Piggyback Registration (180 days with respect to the Corporation's IPO);
provided, that, all directors, officers and holders of at least 5% of any class
of capital stock of the Corporation agree to the same.
(b) The Corporation agrees, if the managing underwriters request
such agreement, (i) not to effect any public sale or distribution of its equity
securities, or any securities convertible into or exchangeable or exercisable
for such securities, during the 90-day period beginning on the effective date of
any underwritten Demand Registration or any underwritten Piggyback Registration
(180 days with respect to the Corporation's IPO) (except as part of such
underwritten registration or pursuant to registrations on Form ▇-▇, ▇▇▇▇ ▇-▇ or
any successor forms), and (ii) to use all reasonable efforts to cause each
person who purchases equity securities (other than equity securities acquired in
a public trading market), or any securities convertible into or exchangeable or
exercisable for such securities, from the Corporation at any time after the date
of this Agreement to agree not to effect any public sale or distribution of any
such securities during such period (except as part of such underwritten
registration, if otherwise permitted).
5. Registration Procedures. (a) Whenever any holders of Registrable
Shares have requested that any Registrable Shares be registered pursuant to this
Agreement, the Corporation will use its best efforts to effect the registration
and the sale of such Registrable Shares in accordance with the intended method
of disposition thereof, and pursuant thereto the Corporation will as
expeditiously as possible:
(i) prepare and file with the Commission a registration
statement with respect to such Registrable Shares and cause such registration
statement to become and remain effective for such period as may be reasonably
necessary to effect the sale of such securities;
(ii) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective and
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such registration statement during such period in
accordance with the intended methods of disposition by the sellers thereof set
forth in such registration statement;
(iii) furnish to each seller of Registrable Shares and the
underwriters of the securities being registered such number of copies of such
registration statement, each
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amendment and supplement thereto, the prospectus included in such registration
statement (including each preliminary prospectus) and such other documents as
such seller or underwriters may reasonably request in order to facilitate the
disposition of the Registrable Shares owned by such seller or the sale of such
securities by such underwriters;
(iv) register or qualify such Registrable Shares under such
other securities or blue sky laws of such jurisdictions as any seller or, in the
case of an underwritten public offering, the managing underwriter, reasonably
requests and do any and all other acts and things which may be reasonably
necessary to enable such seller to consummate the disposition in such
jurisdictions of the Registrable Shares owned by such seller (provided, however,
that the Corporation will not be required to (x) qualify generally to do
business in any jurisdiction where it would not otherwise be required to qualify
but for this subparagraph or (y) consent to general service of process in any
such jurisdiction);
(v) cause all such Registrable Shares to be listed or
authorized for quotation on each securities exchange or automated quotation
system on which similar securities issued by the Corporation are then listed or
quoted;
(vi) provide a transfer agent and registrar for all such
Registrable Shares not later than the effective date of such registration
statement;
(vii) enter into such customary agreements (including
underwriting agreements in customary form) and take all such other actions as
the holders of a majority of the Registrable Shares being sold or the
underwriters, if any, reasonably request in order to expedite or facilitate the
disposition of such Registrable Shares;
(viii) make available for inspection by any seller of
Registrable Shares, any underwriter participating in any disposition pursuant to
such registration statement, and any attorney, accountant or other agent
retained by any such seller or underwriter, all financial and other records,
pertinent corporate documents and properties of the Corporation, and cause the
Corporation's officers, directors, employees and independent accountants to
supply all information reasonably requested by any such seller, underwriter,
attorney, accountant or agent in connection with the preparation of such
registration statement;
(ix) notify each seller of such Registrable Shares, promptly
after it shall receive notice thereof, of the time when such registration
statement has become effective or a supplement to any prospectus forming a part
of such registration statement has been filed;
(x) notify each seller of such Registrable Shares of any
request by the Commission for the amending or supplementing of such registration
statement or prospectus or for additional information;
(xi) prepare and file with the Commission, promptly upon the
request of any seller of such Registrable Shares, any amendments or supplements
to such registration statement or prospectus which, in the written opinion of
counsel selected by the holders of a majority of the Registrable Shares being
registered, is required under the Securities Act in connection with the
distribution of Registrable Shares by such seller;
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(xii) prepare and promptly file with the Commission and
promptly notify each seller of such Registrable Shares of the filing of such
amendment or supplement to such registration statement or prospectus as may be
necessary to correct any statements or omissions if, at the time when a
prospectus relating to such securities is required to be delivered under the
Securities Act, any event shall have occurred as the result of which any such
prospectus or any other prospectus as then in effect would include an untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading;
(xiii) advise each seller of such Registrable Shares, promptly
after it shall receive notice or obtain knowledge thereof, of the issuance of
any stop order by the Commission suspending the effectiveness of such
registration statement or the initiation or threatening of any proceeding for
such purpose and promptly use its best efforts to prevent the issuance of any
stop order or to obtain its withdrawal if such stop order should be issued;
(xiv) (x) at least forty-eight hours prior to the filing of any
registration statement or prospectus or any amendment or supplement to such
registration statement or prospectus furnish a copy thereof to each seller of
such Registrable Shares and (y) refrain from filing any such registration
statement, prospectus, amendment or supplement to which counsel selected by the
holders of a majority of the Registrable Shares being registered shall have
objected in writing on the grounds that such amendment or supplement does not
comply in all material respects with the requirements of the Securities Act;
(xv) at the request of any seller of such Registrable Shares
in connection with an underwritten offering, furnish on the date or dates
provided for in the underwriting agreement: (i) an opinion of counsel, addressed
to the underwriters and the sellers of Registrable Shares, covering such matters
as such underwriters and sellers may reasonably request and as are customarily
covered by the issuer's counsel in an underwritten offering; and (ii) a letter
or letters from the independent certified public accountants of the Corporation
addressed to the underwriters and the sellers of Registrable Shares, covering
such matters as such underwriters and sellers may reasonably request and as are
customarily covered in accountant's letters in connection with an underwritten
offering; and
(xvi) otherwise use its best efforts to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement in accordance with the
intended method of disposition and to make generally available to its security
holders, as soon as reasonably practicable, an earnings statement satisfying the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder.
(b) Each holder of Registrable Shares that sells Registrable
Shares pursuant to a registration under this Agreement agrees as follows:
(i) Such seller shall cooperate as reasonably requested by
the Corporation with the Corporation in connection with the preparation of the
registration statement, and for so long as the Corporation is obligated to file
and keep effective the registration statement, shall provide to the Corporation,
in writing, for use in the registration statement, all such information
regarding such seller and its plan of distribution of the
C-6
Registrable Shares as may be reasonably necessary to enable the Corporation to
prepare the registration statement and prospectus covering the Registrable
Shares, to maintain the currency and effectiveness thereof and otherwise to
comply with all applicable requirements of law in connection therewith.
(ii) During such time as such seller may be engaged in a
distribution of the Registrable Shares, such seller shall comply with Regulation
M promulgated under the Exchange Act and pursuant thereto it shall, among other
things; (x) not engage in any stabilization activity in connection with the
securities of the Corporation in contravention of such regulation; (y)
distribute the Registrable Shares under the registration statement solely in the
manner described in the registration statement; (z) cease distribution of such
Registrable Shares pursuant to such registration statement upon receipt of
written notice from the Corporation that the prospectus covering the Registrable
Shares contains any untrue statement of a material fact or omits a material fact
required to be stated therein or necessary to make the statements therein not
misleading.
6. Registration Expenses. (a) All expenses incident to the
Corporation's performance of or compliance with this Agreement, including,
without limitation, all registration and filing fees, fees of transfer agents
and registrars, fees and expenses of compliance with securities or blue sky
laws, fees of the National Association of Securities Dealers, Inc., printing
expenses, fees and disbursements of counsel for the Corporation, fees and
expenses of the Corporation's independent certified public accountants, and the
fees and expenses of any underwriters (excluding discounts and commissions
attributable to the Registrable Shares included in such registration) and other
Persons retained by the Corporation (all such expenses being herein called
"Registration Expenses"), will be borne by the Corporation. In addition, the
Corporation will pay its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit or quarterly review, the
expense of any liability insurance obtained by the Corporation and the expenses
and fees for listing or authorizing for quotation the securities to be
registered on each securities exchange or automated quotation system on which
any shares of common stock are then listed or quoted.
(b) In connection with each Demand Registration and each
Piggyback Registration effected pursuant to this Agreement, the Corporation will
reimburse the holders of Registrable Shares covered by such registration for the
reasonable and customary fees and disbursements of one counsel for the holders
chosen by the holders of a majority of such Registrable Shares.
7. Indemnification. (a) In the event of a registration of the
Registrable Shares under the Securities Act pursuant to the terms hereof, the
Corporation agrees to indemnify, to the fullest extent permitted by law, each
seller of Registrable Shares, its officers and directors and each Person who
controls such seller (within the meaning of the Securities Act or the Exchange
Act) against all losses, claims, damages, liabilities and expenses (including,
without limitation, reasonable attorneys' fees except as limited by Section
7(c)) caused by any untrue or alleged untrue statement of a material fact
contained in any registration statement under which such Registrable Shares were
registered, any prospectus or preliminary prospectus contained therein or any
amendment thereof or supplement thereto or any omission or alleged
C-7
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, except insofar as the same are caused by
or contained in any information furnished in writing to the Corporation or any
managing underwriter by such seller or any such controlling person expressly for
use therein. In connection with an underwritten offering, the Corporation will
indemnify such underwriters, their officers and directors and each Person who
controls such underwriters (within the meaning of the Securities Act or the
Exchange Act) to the same extent as provided above with respect to the
indemnification of the sellers of Registrable Shares (and with the same
exception with respect to information furnished or omitted by such underwriter
or controlling person thereof) and in connection therewith the Corporation shall
enter into an underwriting agreement in customary form containing such
provisions for indemnification and contribution as shall be reasonably requested
by the underwriters. The reimbursements required by this Section 7(a) will be
made by periodic payments during the course of the investigation or defense, as
and when bills are received or expenses incurred.
(b) In connection with any registration statement in which a
seller of Registrable Shares is participating, each such seller will furnish to
the Corporation in writing such information and affidavits as the Corporation
reasonably requests for use in connection with any such registration statement
or prospectus and, to the fullest extent permitted by law, will indemnify the
Corporation, its directors and officers and each Person who controls the
Corporation (within the meaning of the Securities Act) and each underwriter and
controlling person thereof against any losses, claims, damages, liabilities and
expenses (including, without limitation, reasonable attorneys' fees except as
limited by Section 7(c)) resulting from any untrue statement of a material fact
contained in the registration statement, prospectus or preliminary prospectus or
any amendment thereof or supplement thereto or any omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only to the extent that such untrue statement or omission is
contained in any information or affidavit so furnished in writing to the
Corporation or any managing underwriter by such seller or a controlling person
thereof; provided, that, the obligation to indemnify will be several, not joint
and several, among such sellers of Registrable Shares, and the liability of each
such seller of Registrable Shares will be limited to the net amount received by
such seller from the sale of Registrable Shares pursuant to such registration
statement. The reimbursements required by this Section 7(b) will be made by
periodic payments during the course of the investigation or defense, as and when
bills are received or expenses incurred.
(c) Any Person entitled to indemnification hereunder will (i)
give prompt written notice to the indemnifying party of any claim with respect
to which it seeks indemnification (provided that the failure to give such notice
shall not limit the rights of such Person except to the extent such failure to
give notice shall materially prejudice the rights of the indemnifying party) and
(ii) unless in such indemnified party's reasonable judgment (with written advice
of counsel) a conflict of interest between such indemnified and indemnifying
parties may exist with respect to such claim, permit such indemnifying party to
assume the defense of such claim with counsel reasonably satisfactory to the
indemnified party. If such defense is assumed, the indemnifying party will not
enter into any settlement without the indemnified party's prior written consent
unless such settlement includes an unconditional release of the indemnified
party from liability relating to the claim. An indemnifying party who is not
entitled to, or elects not to, assume the defense of a claim will not be
obligated to pay the fees and expenses of more than one counsel for all parties
indemnified by such indemnifying
C-8
party with respect to such claim, unless in the reasonable judgment (with
written advice of counsel) of any indemnified party a conflict of interest may
exist between such indemnified party and any other of such indemnified parties
with respect to such claim.
(d) Each party hereto agrees that, if for any reason the
indemnification provisions contemplated by Section 7(a) or Section 7(b) are
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, claims, damages, liabilities or expenses (or actions in respect
thereof) referred to therein, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or expenses (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and the indemnified party as well as any other relevant equitable
considerations. The relative fault of such indemnifying party and indemnified
party shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by such
indemnifying party or indemnified party, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by pro
rata allocation (even if the holders or any underwriters or all of them 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 this
Section 7(d). The amount paid or payable by an indemnified party as a result of
the losses, claims, damages, liabilities or expenses (or actions in respect
thereof) referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such indemnified party in connection with
investigating or, except as provided in Section 7(c), defending any such action
or claim. Notwithstanding the provisions of this Section 7(d), no holder shall
be required to contribute an amount greater than the dollar amount of the net
proceeds received by such holder with respect to the sale of any Registrable
Shares. No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The holders'
obligations in this Section 7(d) to contribute shall be several in proportion to
the amount of Registrable Shares registered by them and not joint.
(e) The indemnification and contribution provided for under this
Agreement will remain in full force and effect regardless of any investigation
made by or on behalf of the indemnified party or any officer, director or
controlling Person of such indemnified party.
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8. Compliance with Rule 144. In the event that the Corporation (a)
registers a class of securities under Section 12 of the Exchange Act or (b)
commences to file reports under Section 13 or 15(d) of the Exchange Act, then
the Corporation shall (i) make and keep public information available, as those
terms are understood and defined in Rule 144 of the Commission, (ii) file with
the Commission in a timely manner all reports and other documents required of
the Corporation under the Securities Act and the Exchange Act and (iii) at the
request of any holder who proposes to sell securities in compliance with Rule
144, forthwith furnish to such holder a written statement of compliance with the
reporting requirements of the Commission as set forth in Rule 144 and make
available to such holders such information as will enable the holders to make
sales pursuant to Rule 144.
9. Participation in Underwritten Registrations. No Person may
participate in any registration hereunder which is underwritten unless such
Person (a) agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Person or Persons entitled hereunder
to approve such arrangements and (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
required under the terms of such underwriting arrangements.
10. No Inconsistent Agreements. The Corporation will not hereafter
enter into any agreement with respect to its securities which is inconsistent
with the rights granted to the holders of the Registrable Shares in this
Agreement.
11. Future Registration Rights. The Corporation shall not grant to
any Person any additional registration rights with respect to securities of the
Corporation if such additional registration rights are, in the reasonable
opinion of the holders of at least a majority of the Registrable Shares,
superior in any fashion to the registration rights granted to the Stockholders
pursuant to this Agreement, unless the holders of at least a majority of the
Registrable Shares consent in writing.
12. Remedies. Any Person having rights under any provision of this
Agreement will be entitled to enforce such rights specifically, to recover
damages caused by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law.
13. Amendments and Waivers. Except as otherwise expressly provided
herein, the provisions of this Agreement may be amended or waived at any time
only by the written agreement of the Corporation and Preferred Stock Approval;
provided, that, any such amendment or waiver shall apply equally to all holders
of Registrable Shares. Any waiver, permit, consent or approval of any kind or
character on the part of any such holders of any provision or condition of this
Agreement must be made in writing and shall be effective only to the extent
specifically set forth in writing.
14. Successors and Assigns. Except as otherwise expressly provided
herein, all covenants and agreements contained in this Agreement by or on behalf
of any of the parties hereto will bind and inure to the benefit of the
respective successors and assigns of the parties hereto (other than an assign to
which assignment would violate the terms of the Stockholders Agreement if such
agreement shall remain in effect), whether so expressed or not. In addition
C-10
and whether or not any express assignment has been made, the provisions of this
Agreement which are for the benefit of holders of Registrable Shares are also
for the benefit of, and enforceable by, any subsequent holder of Registrable
Shares who consents in writing to be bound by this Agreement. However, any
successor, assign or holder to have the benefits of this Agreement must at the
request of the Corporation agree to be bound by the terms hereof.
15. Final Agreement. This Agreement constitutes the final agreement
of the parties concerning the matters referred to herein, and supersedes all
prior agreements and understandings.
16. Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
17. Descriptive Heading. The descriptive headings of this Agreement
are inserted for convenience of reference only and do not constitute a part of
and shall not be utilized in interpreting this Agreement.
18. Notices. Any notices required or permitted to be sent hereunder
shall be delivered personally or mailed, certified mail, return receipt
requested, or delivered by overnight courier service to the following addresses,
or such other addresses as shall be given by notice delivered hereunder, or
transmitted by facsimile transmission, and shall be deemed to have been given
upon delivery, if delivered personally, when confirmation of transmission is
received, if transmitted by facsimile, three business days after mailing, if
mailed, one business day after delivery to the courier, if delivered by
overnight courier service, or, in the case of facsimile transmission, when
received:
If to the holders of Registrable Shares, to the addresses set forth on
the stock record books of the Corporation;
In the case of Tribune Company, with copies to:
Sidley & Austin
Bank One Plaza
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile: 312-853-7036
C-11
and in the case of ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc., with copies to:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP
One Federal Reserve Bank Building
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
If to the Corporation:
Career Holdings, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
19. GOVERNING LAW. THE VALIDITY, MEANING AND EFFECT OF THIS
AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
DELAWARE APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THAT STATE.
20. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, and such counterparts together shall constitute one instrument. Each
party shall receive a duplicate original of the counterpart copy or copies
executed by it and the Corporation.
21. Attorneys Fees. In the event of any action, arbitration or suit
based upon or arising out of any actual or alleged breach by any party of any
representation, warranty, covenant or agreement in this Agreement, the
prevailing party shall be entitled to recover its reasonable attorneys' fees and
expenses of such action, arbitration or suit from the other party, in addition
to any other relief ordered by any proper arbitration proceeding or court.
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This Registration Rights Agreement was executed on the date first set
forth above.
CAREER HOLDINGS, INC.
(a Delaware corporation)
By:________________________
Name:
Title:
STOCKHOLDERS
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.
By: __________________________________
Name:
Title:
TRIBUNE COMPANY
By: __________________________________
Name:
Title:
__________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
__________________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
C-13
EXHIBIT D TO
INVESTMENT AGREEMENT
FORM OF AMENDED AND RESTATED
STOCKHOLDERS' AGREEMENT
AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT
AMONG
CAREER HOLDINGS, INC.,
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.
TRIBUNE COMPANY,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
AND
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Table of Contents
Page
ARTICLE I. DEFINITIONS.................................................................... 1
ARTICLE II. THE BOARD OF DIRECTORS........................................................ 1
2.1 Designation of Board by Stockholders................................................ 1
2.2 Board............................................................................... 2
2.3 Removal and Vacancies............................................................... 2
2.4 Actions by the Stockholders......................................................... 2
2.5 Quorum.............................................................................. 2
ARTICLE III. ISSUANCE OF ADDITIONAL SHARES TO STOCKHOLDERS................................ 2
3.1 First Offer by Company to Stockholders.............................................. 2
ARTICLE IV. RESTRICTIONS ON TRANSFER...................................................... 3
4.1 Transfer of Shares.................................................................. 3
4.2 Right of First Offer by Stockholder to Other Stockholders........................... 4
4.3 Tag-Along Rights.................................................................... 4
4.4 Drag Along Rights................................................................... 5
4.5 Pledge.............................................................................. 6
4.6 Void Transfers...................................................................... 6
4.7 Legend.............................................................................. 6
ARTICLE V. AFFILIATION.................................................................... 6
5.1 Affiliation Agreements.............................................................. 6
5.2 Stockholders' Agreement Prevails.................................................... 6
5.3 Transfer of Shares.................................................................. 6
ARTICLE VI. BOOKS AND RECORDS............................................................. 7
6.1 Books, Records and Financial Statements............................................. 7
6.2 Accounting Method................................................................... 7
6.3 Annual Audit........................................................................ 7
6.4 Confidentiality..................................................................... 8
ARTICLE VII. INTELLECTUAL PROPERTY........................................................ 8
7.1 Ownership of Institutional Stockholder's Intellectual Property...................... 8
7.2 Ownership of Company Intellectual Property.......................................... 8
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ARTICLE VIII. UNANIMOUS APPROVAL REQUIREMENTS............................................. 9
8.1 Unanimous Approval of Institutional Stockholders.................................... 9
ARTICLE IX. TERM; AMENDMENT PRIOR TO IPO.................................................. 9
9.1 Term................................................................................ 9
9.2 IPO................................................................................. 10
ARTICLE X. MISCELLANEOUS PROVISIONS....................................................... 10
10.1 Notices............................................................................ 10
10.2 Injunctive Relief.................................................................. 10
10.3 Entire Agreement................................................................... 10
10.4 Application of Delaware Law........................................................ 10
10.5 Amendments......................................................................... 11
10.6 Waivers............................................................................ 11
10.7 Rights and Remedies Cumulative..................................................... 11
10.8 Actions of the Parties............................................................. 11
10.9 Discrepancy between this Agreement and the Certificate of Incorporation or Bylaws.. 11
10.10 Severability...................................................................... 11
10.11 Heirs, Successors, and Assigns.................................................... 11
10.12 No Third Party Beneficiaries...................................................... 11
10.13 Headings.......................................................................... 11
10.14 Interpretation.................................................................... 11
10.15 Counterparts...................................................................... 11
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AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT
This AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT (the "Agreement") is
made as of __________ __, 2000 (the "Effective Date"), by and among Career
Holdings, Inc., a Delaware corporation (the "Company"), ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.,
a Delaware corporation ("KR"), Tribune Company, a Delaware corporation ("TC")
(KR and TC are referred to collectively as the "Institutional Stockholders"),
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇") and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ("Winchester") ( ▇▇▇▇▇▇▇▇
and Winchester are referred to collectively as the "Management Stockholders").
WHEREAS, the Company and the Institutional Stockholders entered into a
Stockholders Agreement dated as of July 16, 2000 to regulate certain aspects of
their relationship, to make certain provisions for the governance of the Company
and to provide for, among other things, restrictions on the transfer or other
disposition of their Shares (as defined herein);
WHEREAS, the Management Stockholders have purchased Shares pursuant to
the Employment Agreements between the Company and each of ▇▇▇▇▇▇▇▇ and
Winchester dated as of the date hereof; and
WHEREAS, the parties desire to amend and restate this Agreement to
include the Management Stockholders as parties to this Agreement and to amend
certain corporate governance provisions.
NOW, THEREFORE, each of the Stockholders and the Company agree as
follows:
ARTICLE I.
DEFINITIONS
Defined terms used but not otherwise defined in this Agreement shall
have the meaning set forth in Appendix I.
ARTICLE II.
THE BOARD OF DIRECTORS
2.1 Designation of Board by Stockholders. The Board shall consist of 5
Directors. KR, TC and the Management Stockholders shall each have the right to
designate one Director to serve on the Board. The initial Director designated
by the Management Stockholders shall be ▇▇▇▇▇▇▇▇. The remaining two Directors
(the "Outside Directors") shall not be employees or Affiliates of any of the
parties hereto and shall be nominated by the Management Stockholders, subject to
the unanimous approval of the Institutional Stockholders. Notwithstanding the
foregoing, as of the date hereof, the Management Stockholders have selected, and
the Institutional Stockholders have approved, (i) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ as an interim
board member until such time as an Outside Director has been nominated by the
Management Stockholders and
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approved by the Institutional Stockholders and (ii) ▇▇▇▇ ▇▇▇▇▇▇ (or such other
ADP nominee) as the other Outside Director until such time as the ADP Marketing
Agreement is no longer in effect.
2.2 Board. The name of each Director designated to serve on the Board as
of the Effective Date and the name of the Stockholder that designated him or her
(in the case of Directors other than the Outside Directors) are set forth on
Schedule 2.2 attached hereto. ▇▇▇▇▇▇▇▇ shall serve as Chairman of the Board so
long as he remains employed by the Company.
2.3 Removal and Vacancies. The Stockholder that designated a Director
shall have the sole right to remove such Director, with or without cause, from
the Board. Such removal shall be effective immediately upon delivery of notice
of such removal to the Company by such designating Stockholder. Stockholders
holding at least a Majority of the Shares may remove any Outside Director with
or without cause. Such removal shall be effective immediately upon delivery of
notice of such removal to the Company by such Stockholders. Notice of any such
removal may be given during a Board meeting by the holders of such Majority of
Shares or their representatives, orally or in writing, to the Chairman of such
meeting, which notice shall be effective immediately upon such delivery. Any
vacancy in the Board shall be filled by the Stockholder that designated the
vacating Director. Any vacancy in the Board created upon the resignation or
removal of an Outside Director shall be filled by the appointment of a Director
by the Management Stockholders, subject to the unanimous approval of the
Institutional Stockholders.
2.4 Actions by the Stockholders. The Stockholders shall take all actions
necessary to appoint all Directors designated by a Stockholder in accordance
with this Article II. The Stockholders shall take all other actions necessary,
including but not limited to the exercise of voting rights, to effect the intent
of this Article II.
2.5 Quorum. At all meetings of the Board, a majority of the Directors,
which majority must include both of the Directors designated by the
Institutional Stockholders, shall constitute a quorum for the transaction of any
business of the Board.
ARTICLE III.
ISSUANCE OF ADDITIONAL SHARES TO STOCKHOLDERS
3.1 First Offer by Company to Stockholders. If the Company desires to
issue, sell or exchange additional Shares or Convertible Securities (other than
as set forth below) ("Additional Shares"), then the Company shall first offer
each Stockholder ("First Offeree") the right to purchase its proportional share
(based upon its percentage ownership of the Shares) of such Additional Shares at
a price and on such other terms applicable to such issuance, sale or exchange.
For purposes of the foregoing, Additional Shares shall not include: (i) any
Shares issued or to be issued upon the exercise of options or other rights to
purchase Shares of the Company to officers, directors, employees or consultants
of the Company and/or its subsidiaries pursuant to any stock or option plans or
grants approved by the Board; (ii) any issuance of Shares or Convertible
Securities in connection with any financing transaction; (iii) Shares or
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Convertible Securities issued pursuant to any public offering registered under
the Securities Act of 1933, as amended; (iv) Shares or Convertible Securities
issued in connection with any stock split or stock dividend of the Shares or any
Convertible Securities; and (v) Shares or Convertible Securities issued in
connection with any acquisition by the Company approved by the Board.
(a) Stockholder Elects Not to Purchase. The Company shall give
written notice ("First Offer Notice") to each First Offeree of the terms of the
proposed issuance, sale or exchange of Additional Shares and of such First
Offeree's proportional share no later than 15 business days prior to the
proposed closing of such issuance, sale or exchange. A First Offeree may accept
such offer (with respect to all or a portion of such First Offeree's
proportional share) by providing a written notice of acceptance within 5
business days after delivery of the First Offer Notice. If any First Offeree
does not accept such First Offeree's proportional share of the Additional
Shares, then any one or more of the non-rejecting First Offerees may elect to
purchase all or a portion of the aggregate rejected Additional Shares in
proportion to each such non-rejecting Stockholder's Share ownership. If any
unsold Additional Shares then exist after implementing the foregoing procedures
of this Section 3.1, then the Company shall have the discretion to issue the
rejected Additional Shares to a Person other than the First Offerees; provided,
that the closing of such issuance, sale or exchange shall occur on a date within
60 days of the delivery of the First Offer Notice. Any such Additional Shares
not so issued, sold or exchanged during such 60-day period shall thereafter
again be subject to the first offer rights of each of the Stockholders under
this Section 3.1.
(b) Stockholder Elects to Purchase. If a First Offeree elects to
purchase any Additional Shares in accordance with clause (a) of this Section
3.1, then the closing of such purchase shall occur on a business date selected
by the Company within 60 days of delivery of the First Offer Notice and, at such
closing, such electing First Offeree shall be obligated to pay when due all
amounts payable for the accepted Additional Shares. In the event that any First
Offeree fails to make such payment when due, then the Company shall be entitled
to specifically enforce, by court action, the defaulting First Offeree's
obligation to make the required payment. In such an event, the defaulting First
Offeree shall (A) pay all costs of the suit, including, without limitation,
attorneys' fees and all expenses incurred in recovering the amount (including
interest) due, and (B) continue to be bound by the terms of this Agreement until
such defaulting First Offeree ceases to be a Stockholder of the Company in
accordance with the terms of this Agreement.
ARTICLE IV.
RESTRICTIONS ON TRANSFER
4.1 Transfer of Shares. A Stockholder shall not sell, assign, pledge,
encumber, hypothecate or otherwise transfer ("Transfer") any Shares except in
accordance with this Article IV, except for a Permitted Transfer and, in the
case of a pledge, as required by the terms of the loans to be made pursuant to
each of the Employment Agreements. Notwithstanding anything to the contrary
contained in this Article IV, no Stockholder shall Transfer any Shares (other
than a Permitted Transfer and any Transfer to the Company pursuant to Section
6(b), (c) or (d) of either of the Employment Agreements) prior to the fourth
anniversary of the Effective Date.
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4.2 Right of First Offer by Stockholder to Other Stockholders.
(a) Transfer Notice and Transfer Interest. Prior to any proposed
Transfer, a Stockholder who desires to Transfer any Shares (the "Transferring
Stockholder") shall deliver to the other Stockholders and the Company a written
notice (the "Transfer Notice") of its intention to Transfer such Shares, which
Transfer Notice shall be irrevocable for a period of 45 days after the delivery
thereof and shall state (i) the total number of Shares which such Stockholder
intends to Transfer (the "Transfer Shares"), (ii) the proposed Transfer price
(the "Transfer Price"), (iii) the proposed transferee and (iv) the proposed date
of Transfer (the "Transfer Date"). The Transfer Shares shall be transferred in
the following order of priorities:
(i) First, the Stockholders (excluding any Transferring
Stockholder) shall have the right and option to purchase the Transfer Shares in
whole for the Transfer Price in proportion to each such Stockholder's ownership
interest in the Company (excluding for purposes of calculating such
Stockholder's proportionate ownership interest in the Company, Shares held by
the Transferring Stockholder) by giving notice of the exercise of such right to
the Transferring Stockholder within 10 business days of delivery of the Transfer
Notice. Should one or more of the Stockholders elect not to participate, then
the Transfer Shares may be purchased in whole or in part for the Transfer Price
(or such pro rata price thereof (the "Pro Rata Transfer Price") if only a
portion of the Transfer Shares is desired) by all interested Stockholders in
proportion to each such interested Stockholder's ownership interest in the
Company (excluding for purposes of calculating such Stockholder's proportionate
ownership interest in the Company, Shares held by the Transferring Stockholder)
or such other method of allocation as otherwise agreed to by such interested
Stockholders.
(ii) Second, if all or any portion of the Transfer Shares shall
have thereafter not been purchased by the Stockholders, the Transferring
Stockholder shall have the right, subject to Section 4.3, for a period of 60
days from the date of the Transfer Notice, to sell all or the remainder of the
Transfer Shares to any Person for no less than the Transfer Price (or the Pro
Rata Transfer Price, as the case may be). In addition, any such transferee shall
not become a stockholder of the Company without having first executed an
instrument reasonably satisfactory to a Majority of the Shares accepting and
agreeing to the terms and conditions of this Agreement, including a counterpart
of this Agreement.
(b) Change in Transfer of Shares. Should the Transferring
Stockholder subsequently determine to change the amount of the Transfer Shares
to be sold or the Transfer Price, the Transferring Stockholder shall be required
to follow the same procedures set forth in clause (a) of this Section 4.2.
4.3 Tag-Along Rights. (a) Each Transferring Stockholder who proposes to
make a bona fide Transfer, directly or indirectly, of such Transferring
Stockholder's interest in Shares representing 15% or more of the outstanding
Shares (a "Tag-Along Sale") shall afford each of the other Stockholders (each, a
"Tag-Along Stockholder") the opportunity to participate therein in accordance
with this Section 4.3. The obligations of a Transferring Stockholder under this
Section 4.3 are in addition to the obligations under Section 4.2, but shall not
apply if all the Transfer Shares are sold to subscribing Stockholders pursuant
to Section 4.2.
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(b) With respect to each Tag-Along Sale, each Tag-Along Stockholder
shall have the right to Transfer, at the same price and upon identical terms and
conditions as such proposed Transfer and in diminution of the amounts to be sold
by the Transferring Stockholder, the number of Shares owned by such Tag-Along
Stockholder equal to such Tag-Along Stockholder's Tag-Along Allotment.
(c) Each Tag-Along Stockholder who wishes to participate in the Tag-
Along Sale shall provide written notice (the "Tag-Along Notice") to the
Transferring Stockholder no less than 7 business days after delivery of the
Transfer Notice. The Tag-Along Notice shall set forth the number and kind of
Shares that such Tag-Along Stockholder elects to include in the Transfer, which
shall not exceed such Tag-Along Stockholder's Tag-Along Allotment. The Tag-Along
Notice shall also specify the aggregate number and kind of additional Shares
owned by such Tag-Along Stockholder as of the close of business on the second
day immediately preceding the date on which the Tag-Along Notice is given by
such Tag-Along Stockholder, if any, that such Tag-Along Stockholder also desires
to include in the Transfer (the "Additional Tag-Along Shares") if there is any
under-subscription for the entire amount of all Tag-Along Stockholders' Tag-
Along Allotments. If there is an under-subscription by the Tag-Along
Stockholders for any portion of the aggregate Tag-Along Stockholders' Tag-Along
Allotments, the Transferring Stockholder shall apportion the under-subscribed
Tag-Along Stockholders' Tag-Along Allotments among the Tag-Along Stockholders
whose Tag-Along Notices specified an amount of Additional Tag-Along Shares,
which apportionment shall be on a pro rata basis among such Tag-Along
Stockholders in accordance with the number of Additional Tag-Along Shares
specified by all such Tag-Along Stockholders in their Tag-Along Notices. The
Tag-Along Notices given by the Tag-Along Stockholders shall constitute their
binding agreements to sell such Shares on the terms and conditions applicable to
the Transfer.
(d) The Transferring Stockholder shall Transfer all or any portion of
the Transfer Shares only if the Transferring Stockholder makes arrangements for
the Transfer, on the same terms and conditions, of all Shares for which Tag-
Along Notices were timely delivered (up to the full amount of the aggregate Tag-
Along Allotments). Transfer of all or any portion of the Transfer Shares by the
Transferring Stockholder shall only be made, however, on terms and conditions no
more favorable to the Transferring Stockholder than as stated in the Transfer
Notice and only if such Transfer occurs on a date within 90 days of the Transfer
Date. Any such Shares not so transferred during such 90-day period shall
thereafter again be subject to the Tag-Along Sale rights of each of the
Stockholders.
4.4 Drag Along Rights. If any Stockholder or any group of Stockholders
acting together or pursuant to a common plan or arrangement propose to sell or
otherwise dispose of to a party unaffiliated with such Stockholders (a
"Purchaser") Shares that at the date of this Agreement constituted at least 70%
of the sum of (i) the outstanding Shares and (ii) the outstanding Convertible
Securities (a "Disposition"), such Stockholder(s) (the "Proposing Stockholders")
shall provide notice of such proposed Disposition to each of the other
Stockholders (a "Proposal Notice"), and the Proposing Stockholders shall have
the right (a "Drag Along Right") to require such other Stockholders to sell the
Shares owned by them to the Purchaser at the same price and upon the same terms
as are applicable to the sale of Shares by the Proposing Stockholders by
delivery of a notice within 7 business days of the Proposal Notice. The Proposal
Notice shall set forth: (i) the identity of the Purchaser(s); (ii) the price and
the other
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general terms of the proposed Disposition; and (iii) the Drag Along Right sale
date. Sections 4.2 and 4.3 shall not apply to sales of Shares by Stockholders
pursuant to the exercise of a Drag Along Right in accordance with this Section
4.4.
4.5 Pledge. No Stockholder may pledge, hypothecate or otherwise encumber
any Shares without the prior written approval of a Majority of the Shares, which
approval may be given or withheld in the sole and absolute discretion of the
Stockholders.
4.6 Void Transfers. Any Transfer, pledge or other encumbrance of Shares
that does not comply with the requirements of this Article IV shall not be
permitted and shall be void and without any effect.
4.7 Legend. All Share certificates shall contain the following legend:
THE SALE, ASSIGNMENT, TRANSFER, PLEDGE, HYPOTHECATION OR ENCUMBRANCE
OF THE SHARES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED BY THE PROVISIONS
OF A STOCKHOLDERS' AGREEMENT AMONG THE COMPANY AND THE STOCKHOLDERS OF THE
COMPANY, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY.
THIS SECURITY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER SECTION 5 OF THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND THIS SECURITY AND ANY SECURITIES ISSUED IN EXCHANGE
THEREFOR MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. BY ACCEPTING THIS
SECURITY, THE HOLDER AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THE
SECURITY REPRESENTED HEREBY EXCEPT PURSUANT TO (I) A REGISTRATION STATEMENT THAT
HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND THAT CONTINUES TO BE
EFFECTIVE AT THE TIME OF SUCH TRANSFER) OR (II) AN APPLICABLE EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT.
ARTICLE V.
AFFILIATION
5.1 Affiliation Agreements. Each of the Institutional Stockholders shall
cause all of their Affiliated Newspapers to enter into, execute and maintain in
force Affiliation Agreements setting forth the relationship between the Company
and such Affiliated Newspaper in substantially the form attached hereto as
Appendix II (an "Affiliation Agreement").
5.2 Stockholders' Agreement Prevails. In the event of any conflict
between the terms of any Affiliation Agreement between the Company and any
Affiliated Newspaper and the terms of this Agreement, the terms of this
Agreement shall prevail.
5.3 Transfer of Shares. If any Institutional Stockholder Transfers in one
or more transactions more than 50% of the Shares held by such Institutional
Stockholder as of the
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Effective Date to a third Person (other than to an Affiliate of such
Institutional Stockholder or to another Institutional Stockholder) then the
Affiliation Agreements entered into by the Affiliated Newspapers of any other
Institutional Stockholder may be immediately terminated by such other
Institutional Stockholder.
ARTICLE VI.
BOOKS AND RECORDS
6.1 Books, Records and Financial Statements.
(a) Books of Account. At all times during the continuance of the
Company, the Company shall maintain, at its principal place of business,
separate books of account for the Company that shall show a true and accurate
record for all costs and expenses incurred, all charges made, all credits made
and received and all income derived in connection with the operation of the
Company business in accordance with GAAP, and, to the extent inconsistent
therewith, in accordance with this Agreement. Such books of account, together
with a copy of this Agreement, the Certificate of Incorporation and the Bylaws,
shall at all times be maintained at the principal place of business of the
Company and shall be open to inspection and examination at reasonable times by
each Stockholder and its duly authorized representative for any purpose
reasonably related to the Stockholder's ownership interest in the Company.
(b) Financial Information. The chief executive officer of the
Company (the "Chief Executive Officer") shall prepare and maintain, or cause to
be prepared and maintained, the books of account of the Company. The following
financial information, which shall be examined and certified to by an
independent certified public accountant, shall be transmitted by the Company to
each Stockholder within three months after the close of each Fiscal Year:
(i) A balance sheet of the Company as of the beginning and close
of such Fiscal Year; and
(ii) A statement of Company profits and losses for such Fiscal
Year.
(c) Unaudited Financial Statements and Other Information. The Chief
Executive Officer shall submit unaudited financial statements of the Company to
each Stockholder on a quarterly basis or such other basis as may be approved by
the Board to comply with applicable laws and rules to which they may be subject.
Upon the request of a Stockholder, the Chief Executive Officer shall promptly
provide records documenting any dividends or distributions paid to stockholders
of the Company and/or a current copy of the business plan of the Company.
6.2 Accounting Method. For both financial and tax purposes, the books and
records of the Company shall be kept on the accrual method of accounting applied
in a consistent manner and shall reflect all Company transactions and be
appropriate and adequate for the Company's business.
6.3 Annual Audit. The financial statements of the Company shall be
audited by an independent certified public accountant, selected by the Board,
with such audit to be
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accompanied by a report of such accountant containing its opinion. The cost of
such audits will be an expense of the Company. A copy of any such audited
financial statements and accountant's report will be made available for
inspection by the Stockholders.
6.4 Confidentiality. Each Stockholder shall, and shall use its best
efforts to cause its representatives to, keep confidential all information
provided to it pursuant to this Article VI to the same extent such information
is treated as confidential by the Company, and shall not directly or indirectly
use such information for any competitive or other commercial purpose. The
obligation to keep such information confidential shall not apply to (i) any
information that (x) was already in such Stockholder's possession prior to the
disclosure thereof by the Company (other than through disclosure by any other
Person known by such Stockholder to be subject to a duty of confidentiality),
(y) was then generally known to the public, or (z) was disclosed to such
Stockholder by a third Person not known by such Stockholder to be bound by an
obligation of confidentiality or (ii) disclosures made as required by law or
legal process or to any Person exercising regulatory authority over such
Stockholder or its Affiliates. If such Stockholder, in the opinion of its
counsel, is compelled to disclose information concerning the Company to any
tribunal or governmental body or agency or else stand liable for contempt or
suffer other censure or penalty, such Stockholder may disclose such information
to such tribunal or governmental body or agency without liability hereunder. If
such Stockholder is compelled, pursuant to the preceding sentence, to disclose
confidential information concerning the Company, such Stockholder will so notify
the Company and will, at the Company's expense, join the Company in seeking a
protective order.
ARTICLE VII.
INTELLECTUAL PROPERTY
7.1 Ownership of Institutional Stockholder's Intellectual Property. Each
Institutional Stockholder shall retain all rights, title and interest in and to
all Intellectual Property that each Institutional Stockholder provides to,
contributes to, or makes available for use with the Company Services
("Stockholder Intellectual Property"). Subject to terms of the previous
sentence, each Institutional Stockholder hereby grants to the Company a
worldwide, non-exclusive license to use or authorize others to use all
Stockholder Intellectual Property provided to, contributed to, or made available
for use with the Company Services to do any of the following: (i) to prepare
derivative works based upon the Stockholder Intellectual Property for use in
connection with the Company Services only; (ii) to disseminate, distribute and
transmit electronically copies of the Stockholder Intellectual Property as part
of the Company Services; and (iii) to display the Stockholder Intellectual
Property publicly as part of the Company Services. The Company shall have no
implied or express license in any Stockholder Intellectual Property other than
the limited license granted in this Section 7.1.
7.2 Ownership of Company Intellectual Property. To the extent the Company
develops or creates its own ideas, concepts, software, patents, designs,
trademarks, trade secrets, text, plans or other material or Intellectual
Property ("Company Intellectual Property"), the Company shall own and retain all
rights, title and interest in and to all such Company Intellectual Property.
Such rights shall include the exclusive right to own and register the Company
Intellectual Property in the Company's name.
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ARTICLE VIII.
UNANIMOUS APPROVAL REQUIREMENTS
8.1 Unanimous Approval of Institutional Stockholders. The unanimous
approval of the Institutional Stockholders shall be required:
(a) To adopt any amendment to the Certificate of Incorporation or By-
laws of the Company, other than such amendments as shall be required in
connection with a Qualified IPO;
(b) To cause the Company to effect a merger, consolidation, or a
sale, disposition or encumbrance of all or substantially all of the assets of
the Company, other than a merger of the Company with ▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. or
CareerBuilder, or any successors thereto;
(c) To commence a voluntary proceeding seeking reorganization or
other relief with respect to the Company under any bankruptcy or other similar
law or to seek the appointment of a trustee, receiver, custodian or other
similar official of the Company or any substantial part of its property, or to
cause the Company to make a general assignment for the benefit of creditors;
(d) To dissolve the Company;
(e) To hire or terminate the Chief Executive Officer or to enter into
an employment contract with, or materially increase or otherwise materially
modify the salary, wages, or other compensation (including stock options, and
stock awards) of the Chief Executive Officer, except for, or as contemplated by,
the ▇▇▇▇▇▇▇▇ Employment Agreement;
(f) To borrow or guarantee an obligation, or to hypothecate, encumber
or grant security interests in the assets of the Company if the amount borrowed
or guaranteed or the value of the assets so encumbered is greater than
$75,000,000 in the aggregate;
(g) To acquire, in a single or related transactions, assets, property
or a business from any person, including, without limitation, acquisitions by
way of purchases of stock, partnership interests, limited liability company
interests or other equity interests, where the acquisition price is more than
$75,000,000; and
(h) To sell any assets of the Company in a single or related
transactions where the sale price or value is more than $75,000,000.
ARTICLE IX.
TERM; AMENDMENT PRIOR TO IPO
9.1 Term. This Agreement shall come into effect on the Effective Date and
continue in force until the earlier to occur of the following:
(a) termination of this Agreement by the agreement of a Majority of
the Shares, which Majority must include all of the Shares held by the
Institutional Stockholders; or
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(b) dissolution or liquidation of the Company.
9.2 IPO. If the Company determines to effect an IPO, then the
Stockholders shall consult with the applicable underwriters regarding how this
Agreement should be amended to facilitate the proposed IPO and the Stockholders
shall meet in order to determine how this Agreement should be amended prior to
the proposed IPO. Notwithstanding the foregoing, the provisions of Sections 3, 4
and 8 of this Agreement shall automatically terminate upon the consummation of
an IPO.
ARTICLE X.
MISCELLANEOUS PROVISIONS
10.1 Notices. All notices and other communications given or made pursuant
hereto shall be in writing and shall be deemed to have been duly signed or made
as of the date delivered if delivered personally, by overnight carrier or by
telecopy or 3 days after being mailed by registered or certified mail (postage
prepaid, return receipt requested) to the parties at the following addresses (or
at such other address for a party as shall be specified by like notice, except
that notices of changes of address shall be effective upon receipt):
(a) Company. If to the Company, Career Holdings, Inc., ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Chief Executive
Officer; or
(b) Stockholder. If to any Stockholder, at the address set forth
opposite its name in Schedule I(A), or such other address as such Stockholder
may hereafter designate by written notice to the Company.
10.2 Injunctive Relief. The parties acknowledge that it will be
impossible to measure in money the damages that would be suffered if the parties
fail to comply with their obligations herein imposed on them and that in the
event of any such failure, an aggrieved party will be irreparably damaged and
will not have an adequate remedy at law. The parties agree that in addition to
any other remedies available to the parties under this Agreement or at law, the
parties shall have the right to obtain injunctive relief, including specific
performance, and if any action should be brought in equity to enforce any of the
provisions of this Agreement, neither party shall raise the defense that there
is an adequate remedy at law.
10.3 Entire Agreement. The Appendix and Schedules attached to this
Agreement shall be deemed to be a part of this Agreement. This Agreement
constitutes the entire agreement among the parties hereto pertaining to the
subject matter hereof and supersedes all prior Agreements and understandings
pertaining hereto.
10.4 Application of Delaware Law. This Agreement, and the application or
interpretation hereof, shall be governed exclusively by its terms and by the
laws of the State of Delaware without regard to principles of conflict of laws.
D-10
10.5 Amendments. This Agreement may be amended only by a vote of a
Majority of the Shares, which majority must include all of the Shares held by
the Institutional Stockholders.
10.6 Waivers. The failure of any party to seek redress for violation of
or to insist upon the strict performance of any covenant or condition of this
Agreement shall not prevent a subsequent act, that would have originally
constituted a violation, from having the effect of an original violation.
10.7 Rights and Remedies Cumulative. The rights and remedies provided by
this Agreement are cumulative and the use of any one right or remedy by any
party shall not preclude or waive the right to use any or all other remedies.
Said rights and remedies are given in addition to any other rights the parties
may have by law, statue, ordinance or otherwise.
10.8 Actions of the Parties. Each of the parties agrees to exercise its
voting rights in the Company and to take all other actions necessary in order to
give full effect to the provisions of this Agreement.
10.9 Discrepancy between this Agreement and the Certificate of
Incorporation or Bylaws. If there is any discrepancy between this Agreement and
the Certificate of Incorporation or the Bylaws, this Agreement shall prevail and
the Certificate of Incorporation or Bylaws shall be revised as necessary to
render such documents consistent with this Agreement. For avoidance of doubt, no
party shall be excused from its obligations hereunder on the grounds that its
action or omission to act conforms to the Certificate of Incorporation or the
Bylaws.
10.10 Severability. If any provision of this Agreement or portion
thereof, or the application of such provision or portion thereof to any Person
or circumstance, shall be held invalid, the remainder of this Agreement, or the
application of such provision or portion thereof to Persons or circumstances
other than those to which it is held invalid, shall not be affected thereby.
10.11 Heirs, Successors, and Assigns. Each and all of the covenants,
terms, provisions, and agreements contained in this Agreement shall be binding
upon and inure to the benefit of the parties hereto and, to the extent permitted
by this Agreement, their respective heirs, legal representatives, successors,
and assigns. Each new stockholder of the Company shall be required to execute a
counterpart of this Agreement at such time as such Person becomes a Stockholder.
10.12 No Third Party Beneficiaries. None of the provisions of this
Agreement shall be for the benefit of or enforceable by any Person other than a
party to this Agreement.
10.13 Headings. The headings and subheadings in this Agreement are
included for convenience and identification only and are in no way intended to
describe, interpret, define or limit the scope, extent or intent of this
Agreement or any provision hereof.
10.14 Interpretation. Throughout this Agreement, nouns, pronouns and
verbs shall be construed as masculine, feminine, neuter, singular or plural,
whichever shall be applicable.
10.15 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original but all of which shall constitute one and
the same instrument.
D-11
IN WITNESS WHEREOF, the parties of this Agreement have executed this
Agreement as of the date first above written.
CAREER HOLDINGS, INC.
By: __________________________________
Name:
Title:
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.
By: __________________________________
Name:
Title:
TRIBUNE COMPANY
By: __________________________________
Name:
Title:
__________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
__________________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Solely for purposes of Section 5.1:
▇▇▇▇▇▇-▇▇▇▇▇▇, INC.
By: __________________________________
Name:
Title:
D-12
APPENDIX I
"Additional Shares" shall have the meaning set forth in Section 3.1.
"Additional Tag-Along Shares" shall have the meaning set forth in
Section 4.3(c).
"Affiliate" shall mean with respect to a specified Person, any Person
directly or indirectly controlling, controlled by or under common control with,
the specified Person and, shall include in the case of a natural Person, (i)
members of such specified Person's immediate family (as defined in Instruction 2
of Item 404(a) of Regulation S-K under the Securities Act of 1933, as amended)
and (ii) trusts, the trustee and all beneficiaries of which are such specified
person or members of such person's immediate family as determined in accordance
with the foregoing clause (i). For purposes of this Agreement, "control" shall
mean the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.
"Affiliation Agreement" shall have the meaning set forth in Section
5.1.
"Affiliated Newspapers(s)" shall mean any newspaper now or hereafter
acquired that is an Affiliate of a Stockholder.
"Agreement" shall have the meaning set forth in the preamble to this
Agreement.
"Board" shall mean the Board of Directors of the Company.
"Bylaws" shall mean the bylaws of the Company, as amended and/or
restated from time to time.
"Certificate of Incorporation" shall mean the Certificate of
Incorporation of the Company, as filed with the office of the Secretary of State
of Delaware, as the same may be amended and/or restated from time to time.
"Chief Executive Officer" shall have the meaning set forth in Section
6.1(b).
"Common Stock" means common stock of the Company, par value $.01 per
share.
"Company" shall have the meaning set forth in the preamble to this
Agreement.
"Company Intellectual Property" shall have the meaning set forth in
Section 7.2.
"Company Services" shall mean any services which enable employers or
other persons to access or provide information electronically relating to
recruitment or employment
D-1
opportunities and any and all related activities, as the Company may determine
to provide from time to time. Notwithstanding any provision of this Agreement,
the definition of Company Services may not be amended without the unanimous vote
or written consent of the Institutional Stockholders.
"Convertible Securities" shall mean rights, warrants, options, or
other securities of the Company that are, directly or indirectly, convertible
into or exchangeable for Shares.
"Director" shall mean a member of the Board of Directors of the
Company.
"Disposition" shall have the meaning set forth in Section 4.4.
"Drag Along Right" shall have the meaning set forth in Section 4.4.
"Effective Date" shall have the meaning set forth in the preamble to
this Agreement.
"Employment Agreements" shall mean the ▇▇▇▇▇▇▇▇ Employment Agreement
and the Winchester Employment Agreement.
"Family Members" with respect to an individual, shall mean such
individual's spouse, parents, siblings and children.
"First Offeree" shall have the meaning set forth in Section 3.1.
"First Offer Notice" shall have the meaning set forth in Section
3.1(a).
"Fiscal Year" shall have the meaning set forth in the by-laws of the
Company.
"GAAP" shall mean generally accepted accounting principles
consistently applied.
"Intellectual Property" shall mean all domestic and foreign
copyrights, copyrightable works, and mask work, whether registered or
unregistered, and registrations and pending applications to register the same,
patents, patent applications, continuations, continuations-in-part, divisions,
reissues, reexaminations, extensions, patent disclosures, inventions (whether or
not patentable or reduced to practice) and improvements thereto, trademarks,
service marks, logos, trade dress, trade names and corporate names, domain names
and universal resource locators, whether registered or unregistered, and
registrations and pending applications to register the foregoing, confidential
ideas, trade secrets, know-how, concepts, methods, processes, formulae, reports,
data, customer lists, supplier lists, mailing lists, business plans or other
proprietary information and all agreements, contracts, licenses, sublicenses,
assignments and indemnities which relate or pertain to any of the foregoing.
"Institutional Stockholders" shall have the meaning set forth in the
preamble to this Agreement.
D-2
"IPO" shall mean an initial registered public offering of the Shares
of the Company.
"Majority of the Shares" shall mean a collective vote of the
Stockholders whose ownership interest in the Company represents greater than 50%
of the issued and outstanding Common Stock together with any other Shares that
vote with the Common Stock.
"Management Stockholders" shall have the meaning set forth in the
preamble to this Agreement.
"▇▇▇▇▇▇▇▇ Employment Agreement" shall mean the Employment Agreement
executed as of July 16, 2000 between the Company and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇.
"Outside Director" shall have the meaning set forth in Section 2.1.
"Permitted Transfer" shall mean a Public Sale or a Transfer by a
Stockholder to: (i) one or more Family Members of such Stockholder, or to such
Stockholder's estate; (ii) a trust or limited liability company created and
maintained solely for the benefit of one or more Family Members of such
Stockholder; or (iii) an Affiliate of such Stockholder. Prior to any such
Transfer, each transferee shall execute and deliver a Joinder Agreement to this
Agreement. Upon such execution and delivery, each such transferee (other than a
Public Transferee) shall be included within the definition of "Stockholder" for
purposes of this Agreement.
"Person" shall mean any person, general partnership, limited
partnership, limited liability company, corporation, joint venture, trust,
cooperative, association or other entity.
"Pro Rata Transfer Price" shall have the meaning set forth in Section
4.2(a)(i).
"Proposal Notice" shall have the meaning set forth in Section 4.4.
"Proposing Stockholder" shall have the meaning set forth in Section
4.4.
"Public Transferee" means a transferee of a Shareholder pursuant to a
Public Sale.
"Public Sale" means any sale of Shares sold pursuant to a registration
statement in compliance with the Securities Act, or sold pursuant to Rule 144
promulgated under the Securities Act.
"Purchaser" shall have the meaning set forth in Section 4.4.
"Qualified IPO" shall mean the Company's sale of its Common Stock in a
bona fide, firm commitment underwriting pursuant to a registration statement
under the Securities Act, with aggregate proceeds, net of underwriters'
discounts and commissions, of more than $50 million.
"Securities Act" means the Securities Act of 1933, as amended.
D-3
"Shares" shall mean the issued and outstanding capital stock of the
Company.
"Stockholder" shall mean any Person named as a stockholder of the
Company on Schedule I(A) hereto, and each of the Persons who hereafter become
new stockholders of the Company pursuant to the terms of this Agreement.
"Stockholder Intellectual Property" shall have the meaning set forth
in Section 7.1.
"Tag-Along Allotment" of any Tag-Along Stockholder shall mean the
product of (i) the total number of Shares proposed to be Transferred in a Tag-
Along Sale multiplied by (ii) a fraction, the numerator of which is the total
number of Shares owned by such Tag-Along Stockholder as of the close of business
on the second day immediately preceding the mailing date of the Transfer Notice
and the denominator of which is the total number of Shares then owned by all the
Stockholders.
"Tag-Along Notice" shall have the meaning set forth in Section 4.3(c).
"Tag-Along Sale" shall have the meaning set forth in Section 4.3(a).
"Tag-Along Stockholder" has the meaning set forth in Section 4.3(a).
"Transfer" shall have the meaning set forth in Section 4.1.
"Transfer Date" shall have the meaning set forth in Section 4.2(a).
"Transfer Notice" shall have the meaning set forth in Section 4.2(a).
"Transfer Price" shall have the meaning set forth in Section 4.2(a).
"Transferring Stockholder" shall have the meaning set forth in Section
4.2(a).
"Transfer Shares" shall have the meaning set forth in Section 4.2(a).
"Winchester Employment Agreement" shall mean the Employment Agreement
executed as of July 16, 2000 between the Company and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇.
D-4
SCHEDULE I(A)
STOCKHOLDERS
------------
Number Shares
Percentage of of Common
Common Stock as of the
Name Address Stock Effective Date
---- ------- ------------- ---------------
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. ▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 46.4% 15,375,000
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Tribune Company ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 46.4% 15,375,000
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇, 6.1% 2,010,324
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇, 1.0% 346,875
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
SCHEDULE 2.2
BOARD OF DIRECTORS
------------------
Appointing Stockholder Name of Director(s) Appointed by Stockholder
---------------------- --------------------------------------------
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. ▇▇▇ ▇▇▇▇▇▇▇▇
Tribune Company ▇▇▇▇▇ ▇▇▇▇▇▇
Management Stockholders ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇