EXHIBIT 10.1
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PURCHASE AGREEMENT
Dated as of May 7, 1998
By and Among
BENEDEK COMMUNICATIONS CORPORATION,
as Issuer,
and
TD SECURITIES (USA) INC.,
and
BT ALEX. ▇▇▇▇▇ INCORPORATED,
as Initial Purchasers
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100,000 SHARES
11 1/2% SENIOR EXCHANGEABLE PREFERRED STOCK
BENEDEK COMMUNICATIONS CORPORATION
$100,000,000
100,000 SHARES OF 11 1/2% SENIOR EXCHANGEABLE PREFERRED STOCK
PURCHASE AGREEMENT
May 7, 1998
TD SECURITIES (USA) INC.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
BT ALEX. ▇▇▇▇▇ INCORPORATED
Bankers Trust Plaza
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Benedek Communications Corporation, a Delaware corporation (the
"Company") hereby confirms its agreement with you (the "Initial Purchasers"), as
set forth below.
1. The Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell severally to the Initial
Purchasers 100,000 shares (the "Shares") of its 11 1/2% Senior Exchangeable
Preferred Stock, par value $0.01 per share (the "Preferred Stock"), which will
be mandatorily redeemable on May 15, 2008, as set forth in the Certificate of
Designation of the Company relating to the Preferred Stock (the "Certificate of
Designation"), and will be exchangeable, in whole but not in part, at the option
of the Company, into 11 1/2% Exchange Debentures due 2008 (the "Exchange
Debentures") to be issued, if applicable, pursuant to an indenture to be dated
as of the date of such exchange (the "Exchange Indenture").
The Shares will be offered and sold to the Initial Purchasers
without being registered under the Securities Act of 1933, as amended (the
"Securities Act"), in reliance on exemptions therefrom or in transactions not
subject to the registration requirements thereof, including sales by the Initial
Purchasers made outside the United States in reliance on Regulation S under the
Securities Act and in the United States to "qualified institutional buyers"
("QIBs") as defined in and in reliance on Rule 144A under the Securities Act.
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In connection with the sale of the Shares, the Company has
prepared a preliminary offering memorandum dated as of April 28, 1998, and a
final offering memorandum dated as of the date hereof (collectively, the
"Offering Memorandum").
The Initial Purchasers and their direct and indirect transferees
of the Shares will be entitled to the benefits of the Registration Rights
Agreement, substantially in the form attached hereto as Exhibit A (the
"Registration Rights Agreement"), pursuant to which the Company agrees, among
other things, to file a registration statement (the "Registration Statement")
with the Securities and Exchange Commission (the "Commission") registering the
Shares and the Exchange Debentures (as defined in the Registration Rights
Agreement), as applicable, under the Securities Act.
Capitalized terms not otherwise defined in this Agreement are
used as defined in the Certificate of Designation. The following capitalized
terms are defined as follows: (a) "Material Adverse Effect" means a material
adverse effect upon (i) the business, operations, properties, assets, financial
condition or prospects of the Company or (ii) the ability of the Company to
execute, deliver or perform its obligations under any Transaction Document; and
(b) "Transaction Documents" means this Agreement, the Registration Rights
Agreement, the Certificate of Designation, the Shares, the Exchange Indenture
and the Exchange Debentures.
2. Representations and Warranties. (a) The Company represents and
warrants to and agrees with the Initial Purchasers that:
(i) Neither the Offering Memorandum nor any amendment or
supplement thereto as of the date thereof and at all times
subsequent thereto up to the Closing Date (as defined in Section
3 below) contained or contains any untrue statement of a material
fact or omitted or omits to state a material fact necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the
representations and warranties set forth in this Section 2(a)(i)
do not apply to statements or omissions made in reliance upon and
in conformity with information relating to the Initial Purchasers
furnished to the Company in writing by the Initial Purchasers,
expressly for use in the Offering Memorandum or any amendment or
supplement thereto.
(ii) As of the Closing Date and after giving effect to the
Offering the Company will have the authorized, issued and
outstanding capitalization set forth in the Offering Memorandum.
(iii) All of the outstanding shares of capital stock of
the Company are or will be on the Closing Date fully paid and
nonassessable. The Company does not and will not on the Closing
Date have outstanding any (i) securities
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convertible or exchangeable for its capital stock or (ii) rights
to subscribe for or to purchase any of its capital stock or
options providing for the purchase of, or agreements providing
for the issuance (contingent or otherwise) of, or any calls,
commitments or claims of any character relating to, its capital
stock except for warrants to purchase shares of Class A Common
Stock of the Company as described in the Offering Memorandum
under "Description of Capital Stock--Warrants." The Company has
no direct or indirect subsidiaries other than Benedek
Broadcasting Corporation, a Delaware corporation, and its wholly
owned subsidiary, Benedek License Corporation.
(iv) The Company is a corporation duly organized, validly
existing and in good standing under the laws of Delaware. The
Company has all requisite power and authority to own and operate
its properties and to carry on its business as now conducted and
as described in the Offering Memorandum, and is duly qualified as
a foreign corporation in all jurisdictions in which it is doing
business, except where the failure to be so qualified or in good
standing could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect.
(v) The Company has all requisite corporate power and
authority to execute, deliver and carry out the terms and
provisions of the Transaction Documents to which it is a party
and has taken all necessary corporate action to authorize the
execution, delivery and performance of the Transaction Documents
to which it is a party.
(vi) The Shares have been duly authorized by the Company
and, when issued and delivered to and paid for by the Initial
Purchasers in accordance with the terms of this Agreement, will
be validly issued, fully paid and non-assessable and will not be
subject to any preemptive or similar rights.
(vii) The Exchange Debentures, if issued, will have
substantially the terms set forth in the Offering Memorandum and
will have been duly authorized by the Company and, when executed,
authenticated and delivered in exchange for all, but not less
than all, of the then outstanding Shares in accordance with the
terms of the Certificate of Designation, (x) will be valid and
binding obligations of the Company enforceable against the
Company in accordance with their terms, excepts as the
enforceability thereof may be limited by bankruptcy, insolvency
or similar laws affecting creditors' rights generally and by
equitable principles of general applicability ("Bankruptcy and
Equity") and (y) will be entitled to the benefits of the Exchange
Indenture.
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(viii) The Certificate of Designation creating the
Preferred Stock, the proposed form of which has been furnished to
you, will have been duly filed with the Secretary of State of the
State of Delaware and with all other offices where such filings
are required, on or before the Closing Date.
(ix) The Exchange Debentures have been duly authorized by
the Company and, when issued and delivered by the Company in
exchange for the Shares, will be validly issued, fully paid and
non-assessable and will not be subject to any preemptive or
similar rights.
(x) When executed and delivered by the Company on the
Closing Date (assuming the due authorization, execution and
delivery by the Initial Purchasers), the Registration Rights
Agreement will constitute a valid and legally binding agreement
of the Company enforceable against the Company in accordance with
its terms, except that (A) the enforcement thereof may be subject
to Bankruptcy and Equity and (B) any rights to indemnity or
contribution thereunder may be limited by federal and state
securities laws. This Agreement has been duly executed and
delivered by the Company.
(xi) The Company is not (i) in violation of its
certificate of incorporation or bylaws, (ii) in breach or
violation of any statute, judgment, decree, order, rule or
regulation applicable to it or any of its properties or assets,
or (iii) in breach of or default under (nor has any event
occurred which, with notice or passage of time or both, would
constitute a default under) or in violation of any of the terms
or provisions of any indenture, mortgage, deed of trust, loan
agreement, note, lease, license, permit, certificate, contract or
other agreement or instrument to which it is a party or to which
its properties or assets are subject (collectively, "Contracts"),
except for any such breach, default, violation or event in each
case of (i), (ii) or (iii) which could not reasonably be
expected, individually or in the aggregate, to have a Material
Adverse Effect.
(xii) No consent, approval, authorization or order of any
court or governmental agency or body or any third party is
required for the issuance and sale by the Company of the Shares
to the Initial Purchasers, the execution, delivery and
performance of the Transaction Documents by the Company or the
consummation by the Company of the other transactions
contemplated hereby or thereby, except (i) such as have been
obtained and such as may be required under state securities or
"Blue Sky" laws, or under the laws of any jurisdiction outside
the United States in connection with the purchase and resale of
the Shares by the Initial Purchasers, (ii) the filing of the
Certificate of Designation with the Secretary of State of the
State of Delaware, (iii) the registration of the Shares or the
Exchange Debentures under the Securities Act as contemplated by
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the Registration Rights Agreement or (iv) consents of the lenders
under the Amended and Restated Credit Agreement of the Company to
the execution, delivery and performance of the Exchange Indenture
and the Exchange Debentures. The issuance and sale of the Shares
to the Initial Purchasers, the execution, delivery and
performance by the Company of the Transaction Documents, the
consummation by the Company of the transactions contemplated
hereby and thereby will not conflict with or constitute or result
in a breach of or a default under (or an event which with notice
or passage of time or both would constitute a default under) or
violation of any of (i) the certificate of incorporation or
bylaws of the Company, (ii) the terms or provisions of any
Contract, or (iii) (assuming compliance with all applicable state
securities or "Blue Sky" laws and assuming the accuracy of the
representations and warranties of the Initial Purchasers in
Section 8 hereof) any statute, judgment, decree, order, rule or
regulation applicable to the Company or any of its properties or
assets, except for any such conflict, breach or violation in each
case which could not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect.
(xiii) The financial statements of the Company included in
the Offering Memorandum have been prepared in accordance with
generally accepted accounting principles applied on a consistent
basis, except as otherwise stated therein. The summary and
selected financial and statistical data in the Offering
Memorandum present fairly in all material respects the
information shown therein and have been prepared and compiled on
a basis consistent with the audited financial statements included
therein, except as otherwise stated therein. McGladrey & ▇▇▇▇▇▇,
LLP (the "Independent Accountants") is an independent public
accounting firm within the meaning of the Securities Act.
(xiv) The pro forma financial statements (including the
notes thereto) of the Company and the other pro forma financial
information of the Company included in the Offering Memorandum
(i) comply as to form in all material respects with the
applicable requirements of Regulation S-X promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
(ii) have been prepared in all material respects in accordance
with the Commission's rules and guidelines with respect to pro
forma financial statements, and (iii) have been properly computed
on the bases described therein; the assumptions used in the
preparation of the pro forma financial data and other pro forma
financial information included in the Offering Memorandum are
reasonable and the adjustments used therein are appropriate to
give effect to the transactions or circumstances referred to
therein.
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(xv) There is not pending or, to the knowledge of the
Company, threatened any action, suit, proceeding, inquiry or
investigation to which the Company, or to which the property or
assets of the Company is subject, before or brought by any court,
arbitrator or governmental agency or body which, if determined
adversely to the Company, could reasonably be expected,
individually or in the aggregate, to have a Material Adverse
Effect or which seeks to restrain, enjoin, prevent the
consummation of or otherwise challenge the issuance or sale of
the Shares to be sold hereunder or the consummation of the other
transactions described in the Offering Memorandum. There are no
legal or governmental proceedings involving or affecting the
Company or any of its properties or assets which would be
required to be described in a prospectus filed pursuant to the
Securities Act that are not described in the Offering Memorandum,
nor are there any material contracts or other documents which
would be required to be described in a prospectus filed pursuant
to the Securities Act that are not described in the Offering
Memorandum.
(xvi) The Company possesses all licenses, permits,
certificates, consents, orders, approvals and other
authorizations from, and has made all declarations and filings
with, all federal, state, local and other governmental
authorities (including the Federal Communications Commission),
all self-regulatory organizations and all courts and other
tribunals, presently required or necessary to own or lease, as
the case may be, and to operate its properties and to carry on
its businesses as now or proposed to be conducted as set forth in
the Offering Memorandum ("Permits"), except where the failure to
obtain such Permits could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse
Effect; the Company has materially fulfilled and performed all of
its obligations with respect to such Permits and no event has
occurred which allows, or after notice or lapse of time would
allow, revocation or termination thereof or results in any other
material impairment of the rights of the holder of any such
Permit; and the Company has not received any notice of any
proceeding relating to revocation or modification of any such
Permit, except where such revocation or modification could not
reasonably be expected, individually or in the aggregate, to have
a Material Adverse Effect.
(xvii) Since the date of the most recent financial
statements appearing in the Offering Memorandum, except as
described therein, (i) the Company has not incurred any
liabilities or obligations, direct or contingent, or entered into
or agreed to enter into any transactions or contracts (written or
oral) not in the ordinary course of business which liabilities,
obligations, transactions or contracts would, individually or in
the aggregate, be material to the business, operations,
properties, assets, financial condition or prospects of the
Company, (ii) the Company has not purchased any of its
outstanding capital stock, nor
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declared, paid or otherwise made any dividend or distribution of
any kind on its capital stock and (iii) there has not been any
material change in the capital stock or long-term indebtedness of
the Company.
(xviii) The Company has filed all necessary federal, state
and foreign income and franchise tax returns and has paid all
taxes shown as due thereon; except as to taxes being contested in
good faith, or where the failure to pay any such taxes would not,
individually or in the aggregate, have a Material Adverse Effect,
other than tax deficiencies which the Company is contesting in
good faith and for which the Company has provided adequate
reserves in accordance with generally accepted accounting
principles, there is no tax deficiency that has been asserted
against the Company which would reasonably be expected,
individually or in the aggregate, to have a Material Adverse
Effect.
(xix) The proceeds from the issuance and sale of the
Shares will be used solely for the purposes specified in the
Offering Memorandum. None of such proceeds will be used for the
purpose of purchasing or carrying any Margin Stock with the
meaning of the applicable provisions of Regulation G, T, U or X
or for the purpose of reducing or retiring any indebtedness which
was originally incurred to purchase or carry Margin Stock or for
any other purpose which might constitute this transaction a
"purpose credit" within the meaning of the applicable provisions
of Regulation G, T, U or X. The issuance and sale of the Shares
as contemplated in the Offering Memorandum, the application of
the proceeds thereof by the Company will comply with Regulations
G, T, U and X of the Board of Governors of the Federal Reserve
System.
(xx) The Company has good and marketable title to all
personal property described in the Offering Memorandum as being
owned by it and good and marketable title to a leasehold interest
in the personal property described in the Offering Memorandum as
being leased by it, free and clear of all liens, charges,
encumbrances or restrictions, except as described in the Offering
Memorandum or to the extent the failure to have such title or the
existence of such liens, charges, encumbrances or restrictions
could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect. All leases,
contracts and agreements to which the Company is a party or by
which any of them is bound are valid and enforceable against the
Company, and, to the Company's knowledge, are valid and
enforceable against the other party or parties thereto and are in
full force and effect with only such exceptions as could not
reasonably be expected, individually or in the aggregate, to have
a Material Adverse Effect and except as such enforceability may
be limited by Bankruptcy and Equity. The Company owns or
possesses adequate licenses or other rights to use all patents,
trademarks, service marks, trade names,
8
copyrights and know-how necessary to materially conduct the
businesses now or proposed to be operated by them as described in
the Offering Memorandum, and the Company has not received any
notice of infringement of (or knows of any such infringement of)
asserted rights of others with respect to any patents,
trademarks, service marks, trade names, copyrights or know-how
which, if such assertion of infringement were sustained, could
reasonably be expected, individually or the aggregate, to have a
Material Adverse Effect.
(xxi) Except as described in the Offering Memorandum and
except as could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect, (A) the Company is
in compliance with and not subject to liability under applicable
Environmental Laws (as defined below), (B) the Company has made
all filings and provided all notices required under any
applicable Environmental Law, and has and is in compliance with
all Permits required under any applicable Environmental Laws and
each of them is in full force and effect, (C) there is no civil,
criminal or administrative action, suit, demand, claim, hearing,
notice of violation, or, to the knowledge of the Company,
investigation, proceeding, notice or demand letter or request for
information pending or, to the knowledge of the Company,
threatened against the Company under any Environmental Law, (D)
no lien, charge, encumbrance or restriction has been recorded
under any Environmental Law with respect to any assets, facility
or property owned, operated, leased or controlled by the Company,
(E) the Company has not received any notice that it has been
identified as a potentially responsible party under the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended ("CERCLA") or any comparable state law
and (F) no property or facility of the Company is (i) listed or
proposed for listing on the National Priorities List under CERCLA
or is (ii) listed in the Comprehensive Environmental Response,
Compensation, Liability Information System List promulgated
pursuant to CERCLA, or on any comparable list maintained by any
state or local governmental authority.
For purposes of this Agreement, "Environmental Laws" means
the common law and all applicable federal, state and local laws
or regulations, codes, orders, decrees, judgments or injunctions
issued, promulgated, approved or entered thereunder, relating to
pollution or protection of public or employee health and safety
or the environment, including, without limitation, laws relating
to (i) emissions, discharges, releases or threatened releases of
hazardous materials into the environment (including, without
limitation, ambient air, surface water, ground water, land
surface or subsurface strata), (ii) the manufacture, processing,
distribution, use, generation, treatment, storage, disposal,
transport or handling of hazardous materials, and (iii)
underground and
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above ground storage tanks and related piping, and emissions,
discharges, releases or threatened releases therefrom.
(xxii) There is no strike, labor dispute, slowdown or work
stoppage with the employees of the Company which is pending or,
to the knowledge of the Company, threatened, except for any such
strike, labor dispute, slowdown or work stoppage which could not
reasonably be expected, individually or in the aggregate, to have
a Material Adverse Effect.
(xxiii) The Company carries insurance in such amounts and
covering such risks as in its reasonable determination is
adequate for the conduct of its business and the value of its
properties.
(xxiv) Except as described in the Offering Memorandum, the
Company is not liable for any prohibited transaction within the
meaning of Section 4975(c) of the Internal Revenue Code of 1986,
as amended (the "Code") or Part 4, of Title I of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") or
an accumulated funding deficiency within the meaning of Section
412 of the Code or Section 302 of ERISA or funding deficiency or
any complete or partial withdrawal liability (within the meaning
of Section 4201 of ERISA) with respect to any pension, profit
sharing or other plan which is subject to ERISA, to which the
Company makes or ever has made a contribution and in which any
employee of the Company is or has been a participant which,
individually or in the aggregate could reasonably be expected to
have a Material Adverse Effect. With respect to such plans, the
Company is in compliance in all material respects with all
applicable provisions of ERISA except where the failure to do so
would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
(xxv) The Company (i) makes and keeps accurate books and
records and (ii) maintains internal accounting controls which
provide reasonable assurance that (A) transactions are executed
in accordance with management's authorization, (B) transactions
are recorded as necessary to permit preparation of its financial
statements and to maintain accountability for its assets, (C)
access to its assets is permitted only in accordance with
management's authorization and (D) the reported accountability
for its assets is compared with existing assets at reasonable
intervals.
(xxvi) The Company is not an "investment company" or a
company "controlled" by an "investment company," within the
meaning of the Investment Company Act of 1940, as amended,
without taking into account the number of holders of securities
of the Company or any company "controlling" the
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Company. The Company is not a "holding company," or a "subsidiary
company" of a "holding company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company,"
within the meaning of the Public Utility Holding Company Act of
1935, as amended.
(xxvii) The Shares, the Exchange Debentures, the Exchange
Indenture and the Registration Rights Agreement will conform in
all material respects to the descriptions thereof in the Offering
Memorandum.
(xxviii) No holder of securities of the Company will be
entitled to have such securities registered under the
registration statements required to be filed by the Company
pursuant to the Registration Rights Agreement other than as
expressly permitted thereby.
(xxix) Immediately after the consummation of the
transactions contemplated by this Agreement, the fair value and
present fair saleable value of the assets of the Company will
exceed the sum of its stated liabilities and identified
contingent liabilities; the Company is not and will not be, after
giving effect to the execution, delivery and performance of this
Agreement, and the consummation of the transactions contemplated
hereby, (a) left with unreasonably small capital with which to
carry on its business as it is proposed to be conducted, (b)
unable to pay its debts (contingent or otherwise) as they mature
or (c) otherwise insolvent.
(xxx) Neither the Company nor any of its Affiliates (as
defined in Rule 501(b) of Regulation D under the Securities Act)
has directly, or through any agent or other person acting on its
or their behalf (other than the Initial Purchasers or any
Affiliate of either Initial Purchaser, as to which no
representation is made), (i) sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any
"security" (as defined in the Securities Act) which is or could
be integrated with the sale of the Shares in a manner that would
require the registration under the Securities Act of the Shares
or (ii) engaged in any form of general solicitation or general
advertising (as those terms are used in Regulation D under the
Securities Act) in connection with the offering of the Shares or
in any manner involving a public offering within the meaning of
Section 4(2) of the Securities Act. Assuming the accuracy of the
representations and warranties of the Initial Purchasers in
Section 8 hereof and compliance by the Initial Purchasers with
the procedures set forth in Section 4 hereof, it is not necessary
in connection with the offer, sale and delivery of the Shares to
the Initial Purchasers in the manner contemplated by this
Agreement and the Offering Memorandum to register any of the
Shares under the Securities Act.
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(xxxi) No securities of the Company are (i) of the same
class (within the meaning of Rule 144A under the Securities Act)
as the Shares and (ii) (a) listed on a national securities
exchange registered under Section 6 of the Exchange Act or (b)
quoted in a U.S. automated inter-dealer quotation system (as such
term is used in the Exchange Act).
(xxxii) None of the Company or any of its Affiliates has
taken, nor will any of them take, directly or indirectly, any
action designed to, or that might be reasonably expected to,
cause or result in stabilization or manipulation of the price of
the Shares.
(xxxiii) None of the Company or any of its Affiliates has
directly or through any agent or other person acting on its or
their behalf (other than the Initial Purchasers or any Affiliate
of either Initial Purchaser, as to which no representation is
made) engaged in any directed selling efforts (as that term is
defined in Regulation S under the Securities Act ("Regulation
S")) with respect to the Shares; the Company and its Affiliates
and any person acting on its or their behalf (other than the
Initial Purchasers or any Affiliate of either Initial Purchaser,
as to which no representation is made) have complied with the
offering restrictions requirement of Regulation S; provided that
no representation is made as to the Initial Purchasers or any
Affiliate of either Initial Purchaser.
(xxxiv) The Company has not engaged or retained any
person, other than the Initial Purchasers as the Initial
Purchasers, to act as a financial advisor, underwriter or
placement agent in connection with the issuance of the Shares
and, except for the discount and expenses payable in connection
with the issuance of the Shares as described in the Offering
Memorandum, no person has the right to receive a material amount
of financial advisory, underwriting, placement, finder's or
similar fees in connection with, or as a result of, the issuance
of the Shares and the purchase of the Shares by the Initial
Purchasers or the consummation of the other transactions
contemplated hereby.
3. Purchase, Sale and Delivery of the Shares. On the basis of the
representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the Initial Purchasers, and the Initial Purchasers, acting
severally and not jointly, agree to purchase the Shares in the respective
numbers of shares set forth on Schedule 1 hereto from the Company at a purchase
price of $1,000 per share, less an underwriting spread of 3.5% per share. One or
more certificates in definitive form for the Shares that the Initial Purchasers
have agreed to purchase hereunder, and in such denomination or denominations and
registered in such name or names as the Initial Purchasers request upon notice
to the Company at least one business day
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prior to the Closing Date, shall be delivered by or on behalf of the Company to
the Initial Purchasers, against payment by or on behalf of the Initial
Purchasers of the purchase price therefor by wire transfer (same day funds) to
such account or accounts as the Company shall specify prior to the Closing Date,
or by such means as the parties hereto shall agree prior to the Closing Date.
Such delivery of and payment for the Shares shall be made at the offices of
Shearman & Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ at 9:00 a.m., New
York time, on May 14, 1998, or at such other place, time or date not later than
June 1, 1998 as the Initial Purchasers, on the one hand, and the Company, on the
other hand, may agree upon, such time and date of delivery against payment being
herein referred to as the "Closing Date." The Company will make such certificate
or certificates for the Shares available for checking and packaging by the
Initial Purchasers at the offices of TD Securities (USA) Inc. in New York, New
York, or at such other place as TD Securities (USA) Inc. may designate, at least
24 hours prior to the Closing Date.
4. Offering by the Initial Purchasers. The Initial Purchasers
propose to make an offering of the Shares at the price and upon the terms set
forth herein and in the Offering Memorandum, as soon as practicable after this
Agreement is entered into and as in the judgment of the Initial Purchasers is
advisable.
5. Covenants of the Company. (a) The Company covenants and agrees
with the Initial Purchasers that:
(i) The Company will not amend or supplement the Offering
Memorandum or any amendment or supplement thereto of which the
Initial Purchasers shall not previously have been advised and
furnished a copy for a reasonable period of time prior to the
proposed amendment or supplement and as to which the Initial
Purchasers shall not have given their consent. The Company will
promptly, upon the reasonable request of the Initial Purchasers
or counsel for the Initial Purchasers, make any amendments or
supplements to the Offering Memorandum that may be necessary or
advisable in connection with the resale of the Shares by the
Initial Purchasers.
(ii) The Company will cooperate with the Initial
Purchasers in arranging for the qualification of the Shares for
offering and sale under the securities or "Blue Sky" laws of such
jurisdictions as the Initial Purchasers may reasonably designate
and will continue such qualifications in effect for as long as
may be necessary to complete the resale of the Shares; provided,
however, that in connection therewith, the Company shall not be
required to qualify as a foreign corporation or to execute a
general consent to service of process in any jurisdiction or to
take any other action that would subject either of them to
service of process in suits in any jurisdiction other than that
arising out of the offering or sale of the Shares in such
jurisdiction, or subject itself to taxation in
13
excess of a nominal dollar amount in any such jurisdiction where
it is not then so subject.
(iii) At any time prior to the earlier of (i) 365 days
from the Closing Date and (ii) the completion of the distribution
by the Initial Purchasers of the Shares during which a Shelf
Registration Statement for the sale of such Shares is not
effective under the Securities Act pursuant to the Registration
Rights Agreement if any event occurs or information becomes known
as a result of which the Offering Memorandum as then amended or
supplemented would include any untrue statement of a material
fact, or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading, or, if for any other reason it is
necessary at any time to amend or supplement the Offering
Memorandum to comply with applicable law, the Company will
promptly notify the Initial Purchasers thereof and will prepare,
at the expense of the Company, an amendment or supplement to the
Offering Memorandum that corrects such statement or omission or
effects such compliance.
(iv) The Company will, without charge, provide to the
Initial Purchasers, and to counsel for the Initial Purchasers, as
many copies of the Offering Memorandum or any amendment or
supplement thereto as the Initial Purchasers may reasonably
request.
(v) The Company will apply the net proceeds from the sale
of the Shares as set forth under the caption "Use of Proceeds" in
the Offering Memorandum.
(vi) For so long as any of the Shares remain outstanding,
the Company will furnish to the Initial Purchasers copies of all
reports and other communications (financial or otherwise)
furnished by the Company to the Transfer Agent or to the holders
of the Shares.
(vii) Prior to the Closing Date, the Company will furnish
to the Initial Purchasers, as soon as they have been prepared, a
copy of any unaudited interim financial statements of the Company
for any period subsequent to the period covered by the most
recent financial statements appearing in the Offering Memorandum.
(viii) None of the Company or any of its Affiliates will
sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any "security" (as defined in the
Securities Act) which could be integrated with the sale of the
14
Shares in a manner which would require the registration under the
Securities Act of the Shares.
(ix) None of the Company or any of its Affiliates will
directly, or through any agent or other person acting on its or
their behalf, engage in (i) any form of general solicitation or
general advertising (as such terms are used in Regulation D under
the Securities Act) in connection with the offering of the Shares
or in any manner involving a public offering within the meaning
of Section 4(2) of the Securities Act or (ii) any "directed
selling efforts" (as defined in Regulation S) in respect of the
Shares.
(x) For so long as any of the Shares constitute
"restricted securities" within the meaning of Rule 144(a)(3)
under the Securities Act, the Company will make available at its
expense, upon request, to any holder of such Shares and any
prospective purchasers thereof the information specified in Rule
144A(d)(4) under the Securities Act, unless the Company is then
subject to Section 13 or 15(d) of the Exchange Act
(xi) The Company will use its best efforts to (i) permit
the Shares to be designated PORTAL securities in accordance with
the rules and regulations adopted by the NASD relating to trading
in the Private Offerings, Resales and Trading through Automated
Linkages market (the "PORTAL Market") and (ii) permit the Shares
to be eligible for clearance and settlement through the
facilities of the Depository.
6. Expenses. The Company agrees to pay all costs and expenses
incident to the performance of its obligations under this Agreement, whether or
not the transactions contemplated herein are consummated or this Agreement is
terminated pursuant to Section 11 hereof including all costs and expenses
incident to (i) the printing, word processing or other production of documents
with respect to the transactions contemplated hereby, including any costs of
printing the Offering Memorandum and any amendment or supplement thereto, and
any "Blue Sky" memoranda, (ii) all arrangements relating to the delivery to the
Initial Purchasers of copies of the foregoing documents, (iii) the fees and
disbursements of the counsel, the accountants and any other experts or advisors
retained by the Company, (iv) preparation (including printing), issuance and
delivery to the Initial Purchasers of the Shares, (v) the qualification of the
Shares under state securities and "Blue Sky" laws, including filing fees and
reasonable fees and disbursements of counsel for the Initial Purchasers relating
thereto, (vi) expenses in connection with any meetings with prospective
investors in the Shares, (vii) fees and expenses of the Transfer Agent including
reasonable fees and expenses of counsel, (viii) all expenses and listing fees
incurred in connection with the application for quotation of the Shares on the
PORTAL Market, and (ix) any fees charged by investment rating agencies for the
rating of the Shares. If the sale of the Shares provided for herein is not
15
consummated because any condition to the obligations of the Initial Purchasers
set forth in Section 7 hereof is not satisfied, because this Agreement is
terminated or because of any failure, refusal or inability on the part of the
Company to perform all obligations and satisfy all conditions on its part to be
performed or satisfied hereunder (other than solely by reason of a default by
the Initial Purchasers of their obligations hereunder after all conditions
hereunder have been satisfied in accordance herewith), the Company agrees to
promptly reimburse the Initial Purchasers upon demand for all reasonable
out-of-pocket expenses (including, without limitation, reasonable fees,
disbursements and charges of Shearman & Sterling, counsel for the Initial
Purchasers) that shall have been incurred by the Initial Purchasers in
connection with the proposed purchase and sale of the Shares; provided, however,
that the Company shall then be under no further liability to the Initial
Purchasers except as provided under this Section 6 and Section 9 hereof.
7. Conditions of the Initial Purchasers' Obligations. The
obligation of the Initial Purchasers to purchase and pay for the Shares shall,
in their sole discretion, be subject to the satisfaction or waiver of the
following conditions on or prior to the Closing Date:
(a) On the Closing Date, the Initial Purchasers shall have
received the opinion, dated as of the Closing Date and addressed to the
Initial Purchasers, of Shack & ▇▇▇▇▇▇, P.C. ("Company Counsel"), counsel
for the Company, in form and substance reasonably satisfactory to
counsel for the Initial Purchasers. In rendering such opinion, Company
Counsel may rely upon such certificates and other documents and
information as it may reasonably require to pass upon such matters.
(b) On the Closing Date, the Initial Purchasers shall have
received the opinion, dated as of the Closing Date and addressed to the
Initial Purchasers, of ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ ("FCC Counsel"), FCC counsel
for the Company, in form and substance reasonably satisfactory to
counsel for the Initial Purchasers. In rendering such opinion, FCC
Counsel may rely upon such certificates and other documents and
information as it may reasonably require to pass upon such matters.
(c) On the Closing Date, the Initial Purchasers shall have
received the opinion, dated as of the Closing Date and addressed to the
Initial Purchasers, of ▇▇▇▇▇▇▇ Breed ▇▇▇▇▇▇ & ▇▇▇▇▇▇ ("Tax Counsel"),
tax counsel for the Company, in form and substance reasonably
satisfactory to counsel for the Initial Purchasers. In rendering such
opinion, Tax Counsel may rely upon such certificates and other documents
and information as it may reasonably require to pass upon such matters.
(d) On the Closing Date, the Initial Purchasers shall have
received the opinion, in form and substance satisfactory to the Initial
Purchasers, dated as of the Closing Date and addressed to the Initial
Purchasers, of Shearman & Sterling, counsel for the Initial Purchasers,
with respect to certain legal matters relating to this
16
Agreement and such other related manners as the Initial Purchasers may
reasonably require. In rendering such opinion, Shearman & Sterling shall
have received and may rely upon such certificates and other documents
and information as it may reasonably request to pass upon such matters.
(e) The Initial Purchasers shall have received from the
Independent Accountants a comfort letter or letters dated the date
hereof and the Closing Date, in form and substance satisfactory to
counsel for the Initial Purchasers.
(f) The representations and warranties of the Company contained
in this Agreement shall be true and correct on and as of the date hereof
and on and as of the Closing Date as if made on and as of the Closing
Date; the statements of the Company's officers made pursuant to any
certificate delivered in accordance with the provisions hereof shall be
true and correct on and as of the date made and on and as of the Closing
Date; the Company shall have performed all covenants and agreements and
satisfied all conditions on their part to be performed or satisfied
hereunder at or prior to the Closing Date; and, except as described in
the Offering Memorandum (exclusive of any amendment or supplement
thereto after the date hereof), subsequent to the date of the most
recent financial statements in such Offering Memorandum, there shall
have been no event or development, and no information shall have become
known, that, individually or in the aggregate, has or could reasonably
be expected to have a Material Adverse Effect.
(g) The sale of the Shares hereunder shall not be enjoined
(temporarily or permanently) on the Closing Date.
(h) Subsequent to the date of the most recent financial
statements in the Offering Memorandum (exclusive of any amendment or
supplement thereto after the date hereof), the business or operations of
the Company shall not have been interfered with by fire, flood,
hurricane, accident or other calamity, whether or not covered by
insurance, or from any strike, labor dispute, slow down or work stoppage
or from any legal or governmental proceeding, order or decree, and the
Company and its properties shall not have sustained any loss or damage,
whether or not covered by insurance, as a result of any such occurrence,
except any such interference, loss or damage which has not had, and
could not reasonably be expected to have, a Material Adverse Effect.
(i) The Initial Purchasers shall have received certificates of
the Company, dated the Closing Date, signed on behalf of the Company by
any two of its Chairman of the Board, Chief Executive Officer,
President, Chief Financial Officer and any Senior Vice President to the
effect that:
17
(A) The representations and warranties of the Company
contained in this Agreement are true and correct on and as of the
date hereof and on and as of the Closing Date, and the Company
has performed all covenants and agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at
or prior to the Closing Date;
(B) At the Closing Date, since the date hereof or since
the date of the most recent financial statements in the Offering
Memorandum (exclusive of any amendment or supplement thereto
after the date hereof), no event or development has occurred, and
no information has become known that individually or in the
aggregate, has or could reasonably be expected to have a Material
Adverse Effect;
(C) The sale of the Shares hereunder has not been enjoined
(temporarily or permanently); and
(D) Such other information as the Initial Purchasers may
reasonably request.
(j) On the Closing Date, the Initial Purchasers shall have
received the Registration Rights Agreement executed by the Company and
such agreement shall be in full force and effect at all times from and
after the Closing Date.
On or before the Closing Date, the Initial Purchasers and counsel
for the Initial Purchasers shall have received such further documents, opinions,
certificates, letters and schedules or agreements relating to the business,
corporate, legal and financial affairs of the Company as they shall have
heretofore reasonably requested from the Company.
All such documents, opinions, certificates, letters, schedules or
instruments delivered pursuant to this Agreement will comply with the provisions
hereof only if they are reasonably satisfactory in all material respects to the
Initial Purchasers and counsel for the Initial Purchasers. The Company shall
furnish to the Initial Purchasers such conformed copies of such documents,
opinions, certificates, letters, schedules and instruments in such quantities as
the Initial Purchasers shall reasonably request.
8. Offering of Shares; Restrictions on Transfer. (a) The Initial
Purchasers represent and warrant (as to themselves only) that they are QIBs. The
Initial Purchasers have advised the Company that they propose to offer the
Shares for resale upon the terms and conditions set forth in this Agreement and
in the Offering Memorandum. Each Initial Purchaser acknowledges and agrees that
the Shares have not been and, other than pursuant to the Company's obligations
under the Registration Rights Agreement, will not be, registered under the
Securities Act, and may not be offered or sold within the United States unless
the
18
Shares are registered under the Securities Act or an exemption from the
registration requirements of the Securities Act is available. Each of the
Initial Purchasers hereby represents and warrants and agrees with the Company
(as to itself only) that (i) it has not and will not solicit offers for, or
offer or sell, the Shares by any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Securities Act)
or in any manner involving a public offering within the meaning of Section 4(2)
of the Securities Act; and (ii) it has and will solicit offers for the Shares
only from, and will offer the Shares only to (A) in the case of offers inside
the United States, persons whom the Initial Purchasers reasonably believe to be
QIBs or, if any such person is buying for one or more institutional accounts for
which such person is acting as fiduciary or agent, only when such person has
represented to the Initial Purchasers that each such account is a QIB, to whom
notice has been given that such sale or delivery is being made in reliance on
Rule 144A, and, in each case, in transactions under Rule 144A and (B) in the
case of offers outside the United States, to persons other than U.S. persons
("Foreign Purchasers," which term shall include dealers or other professional
fiduciaries in the United States acting on a discretionary basis for foreign
beneficial owners (other than an estate or trust)); provided, however, that, in
the case of this clause (B), in purchasing such Shares such persons are deemed
to have represented and agreed as provided under the caption "Notice to
Investors" contained in the Offering Memorandum.
(b) Each of the Initial Purchasers represent and warrant (as to
itself only) with respect to offers and sales outside the United States that (i)
it has and will comply with all applicable laws and regulations in each
jurisdiction in which it acquires, offers, sells or delivers Shares or has in
its possession or distributes any Memorandum or any such other material, in all
cases at its own expense; (ii) the Shares have not been and will not be offered
or sold within the United States or to, or for the account or benefit of, U.S.
persons except in accordance with Regulation S under the Act or pursuant to an
exemption from the registration requirements of the Act; (iii) it has offered
the Shares and will offer and sell the Shares (A) as part of its distribution at
any time and (B) otherwise until 40 days after the later of the commencement of
the offering and the Closing Date, only in accordance with Rule 903 of
Regulation S and, accordingly, neither it nor any persons acting on its behalf
have engaged or will engage in any directed selling efforts (within the meaning
of Regulation S) with respect to the Shares, and any such persons have complied
and will comply with the offering restrictions requirement of Regulation S; and
(iv) it agrees that, at or prior to confirmation of sales of the Shares, it will
have sent to each distributor, dealer or person receiving a selling concession,
fee or other remuneration that purchases Shares from it during the restricted
period a confirmation or notice to substantially the following effect:
"The Securities covered hereby have not been registered under the
United States Securities Act of 1933 (the "Securities Act") and
may not be offered and sold within the United States or to, or
for the account or benefit of, U.S. persons (i) as part of the
distribution of the Securities at any time or (ii) otherwise
until 40
19
days after the later of the commencement of the offering and the
closing date of the offering, except in either case in accordance
with Regulation S (or Rule 144A if available) under the
Securities Act. Terms used above have the meaning given to them
in Regulation S."
Terms used in this Section 8 and not defined in this Agreement have the meanings
given to them in Regulation S.
9. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless the Initial Purchasers, and their affiliates,
directors, officers, agents, representatives, and employees and each person, if
any, who controls any Initial Purchaser within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Exchange Act, against any losses, claims,
damages or liabilities to which the Initial Purchasers or any such affiliate,
director, officer, agent, representative, employee or such controlling person
may become subject under the Securities Act, the Exchange Act or otherwise,
insofar as any such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of any
material fact contained in the Offering Memorandum or any amendment or
supplement thereto or any application or other document, or any
amendment or supplement thereto, executed by the Company or based upon
written information furnished by or on behalf of the Company filed in
any jurisdiction in order to qualify the Shares under the securities or
"Blue Sky" laws thereof or filed with any securities association or
securities exchange (each an "Application"); or
(ii) the omission or alleged omission to state, in the Offering
Memorandum or any amendment or supplement thereto or any Application, a
material fact required to be stated therein or necessary to make the
statements therein not misleading,
and will reimburse, as incurred, the Initial Purchasers and each such
controlling person for any reasonable legal or other expenses incurred by the
Initial Purchasers or such controlling person in connection with investigating,
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action; provided, however, the Company
will not be liable in any such case to the extent that any such loss, claim,
damage, or liability arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in the Offering
Memorandum or any amendment or supplement thereto or any Application in reliance
upon and in conformity with written information concerning the Initial
Purchasers furnished to the Company by the Initial Purchasers specifically for
use therein. The Company shall not be liable under this Section 9 for any
settlement of any claim or action effected without its prior written consent,
which shall
20
not be unreasonably withheld. No Initial Purchaser shall, without the prior
written consent of the Company, effect any settlement or compromise of any
pending or threatened proceeding in respect of which the Company is or could
have been a party, or indemnity could have been sought hereunder by the Company,
unless such settlement (A) includes an unconditional written release of the
Company, in form and substance reasonably satisfactory to the Company, from all
liability on claims that are the subject matter of such proceeding and (B) does
not include any statement as to an admission of fault, culpability or failure to
act by or on behalf of the Company.
(b) The Initial Purchasers agree to indemnify and hold harmless
the Company and its respective affiliates, directors, officers, agents,
representatives, and employees and each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act against any losses, claims, damages or liabilities to which the
Company or any such affiliate, director, officer, agent, representative,
employee or controlling person may become subject under the Securities Act, the
Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon (i)
any untrue statement or alleged untrue statement of any material fact contained
in the Offering Memorandum or any amendment or supplement thereto or any
Application, or (ii) the omission or the alleged omission to state therein a
material fact required to be stated in the Offering Memorandum or any amendment
or supplement thereto or any Application, or necessary to make the statements
therein not misleading, in light of the circumstances under which they were made
in each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information concerning such Initial
Purchaser, furnished to the Company by the Initial Purchasers specifically for
use therein; and subject to the limitation set forth immediately preceding this
clause, will reimburse, as incurred, any reasonable legal or other expenses
incurred by the Company or any such affiliate, director, officer, agent,
representative, employee or controlling person in connection with investigating
or defending against or appearing as a third-party witness in connection with
any such loss, claim, damage, liability or action in respect thereof. This
indemnity agreement will be in addition to any liability that the Initial
Purchasers may otherwise have to the indemnified parties. The Initial Purchasers
shall not be liable under this Section 9 for any settlement of any claim or
action effected without their consent, which shall not be unreasonably withheld.
The Company shall not, without the prior written consent of the Initial
Purchasers, effect any settlement or compromise of any pending or threatened
proceeding in respect of which any Initial Purchaser is or could have been a
party, or indemnity could have been sought hereunder by any Initial Purchaser,
unless such settlement (A) includes an unconditional written release of the
Initial Purchasers, in form and substance reasonably satisfactory to the Initial
Purchasers, from all liability on claims that are the subject matter of such
proceeding and (B) does not include any statement as to an admission of fault,
culpability or failure to act by or on behalf of any Initial Purchaser.
21
(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action for which such indemnified
party is entitled to indemnification under this Section 9, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 9, notify the indemnifying party of the commencement
thereof in writing; but the omission to so notify the indemnifying party (i)
will not relieve the indemnifying party from any liability under paragraph (a)
or (b) above unless and to the extent such failure results in the forfeiture by
the indemnifying party of substantial rights and defenses and (ii) will not, in
any event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation provided in
paragraphs (a) and (b) above. In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party; provided, however, that if (i) the use of counsel chosen
by the indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest, (ii) the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have been advised by counsel that there may be one or
more legal defenses available to it and/or other indemnified parties that are
different from or additional to those available to the indemnifying party, or
(iii) the indemnifying party shall not have employed counsel reasonably
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after receipt by the indemnifying party of notice of the
institution of such action, then, in each such case, the indemnifying party
shall not have the right to direct the defense of such action on behalf of such
indemnified party or parties and such indemnified party or parties shall have
the right to select separate counsel to defend such action on behalf of such
indemnified party or parties. After notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof and approval
by such indemnified party of counsel appointed to defend such action, the
indemnifying party will not be liable to such indemnified party under this
Section 9 for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in connection
with the defense thereof, unless (i) the indemnified party shall have employed
separate counsel in accordance with the proviso to the immediately preceding
sentence (it being understood, however, that in connection with such action the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (in addition to local counsel) in any one action or separate
but substantially similar actions in the same jurisdiction arising out of the
same general allegations or circumstances, designated by the Initial Purchasers
in the case of paragraph (a) of this Section 9 or the Company in the case of
paragraph (b) of this Section 9, representing the indemnified parties under such
paragraph (a) or paragraph (b), as the case may be, who are parties to such
action or actions) or (ii) the indemnifying party has authorized in writing the
employment of counsel for the indemnified party at the expense of the
indemnifying party. After such notice from the indemnifying party to such
indemnified party, the indemnifying party will not be liable for the costs and
expenses of any settlement of such
22
action effected by such indemnified party without the prior written consent of
the indemnifying party (which consent shall not be unreasonably withheld),
unless such indemnified party waived in writing its rights under this Section 9,
in which case the indemnified party may effect such a settlement without such
consent.
(d) In circumstances in which the indemnity agreement provided
for in the preceding paragraphs of this Section 9 is unavailable to, or
insufficient to, hold harmless, an indemnified party in respect of any losses,
claims, damages or liabilities (or actions in respect thereof), each
indemnifying party, in order to provide for just and equitable contribution,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect (i) the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party on the other from the offering of the Shares or (ii) if the
allocation provided by the foregoing clause (i) is not permitted by applicable
law, not only such relative benefits but also the relative fault of the
indemnifying party or parties on the one hand and the indemnified party on the
other in connection with the statements or omissions or alleged statements or
omissions that resulted in such losses, claims, damages or liabilities (or
actions in respect thereof). The relative benefits received by the Company, on
the one hand, and any Initial Purchaser, on the other, shall be deemed to be in
the same proportion as the total proceeds from the offering (before deducting
expenses) received by the Company bear to the total discounts received by such
Initial Purchaser. The relative fault of the parties shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, on the one hand, or such Initial
Purchaser, on the other, the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omissions or
alleged statement or omission, and any other equitable considerations
appropriate in the circumstances. The Company and the Initial Purchasers agree
that it would not be equitable if the amount of such contribution were
determined by pro rata or per capita allocation or by any other method of
allocation that does not take into account the equitable considerations referred
to in the first sentence of this paragraph (d). Notwithstanding any other
provision of this paragraph (d), no Initial Purchaser shall be obligated to make
contributions hereunder that in the aggregate exceed the total discounts,
commissions and other compensation received by such Initial Purchaser under this
Agreement, less the aggregate amount of any damages that the Initial Purchasers
has otherwise been required to pay by reason of the untrue or alleged untrue
statements or the omissions or alleged omissions to state a material fact, and
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. For purposes of this
paragraph (d), each affiliate, director, officer, agent, representative or
employee of an Initial Purchaser and each person, if any, who controls an
Initial Purchaser with the meaning of Section 15 of the Securities Act or
Section 20(a) of the Exchange Act shall have the same rights to contribution as
the Initial Purchasers, and each affiliate, director, officer, agent,
23
representative or employee of the Company and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20(a) of the Exchange Act, shall have the same rights to contribution as the
Company.
10. Survival Clause. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Company and their
respective officers and the Initial Purchasers set forth in this Agreement or
made by or on behalf of them pursuant to this Agreement shall remain in full
force and effect, regardless of (i) any investigation made by or on behalf of
the Company, any of their officers or directors, the Initial Purchasers or any
controlling person referred to in Section 9 hereof and (ii) delivery of and
payment for the Shares. The respective agreements, covenants, indemnities and
other statements set forth in Sections 6, 9 and 15 hereof shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement.
11. Termination. (a) This Agreement may be terminated in the sole
discretion of the Initial Purchasers by notice to the Company given prior to the
Closing Date in the event that the Company shall have failed, refused or been
unable to perform all obligations and satisfy all conditions on their part to be
performed or satisfied hereunder at or prior thereto or, if at or prior to the
Closing Date:
(i) the Company shall have sustained any loss or interference
with respect to its businesses or properties from fire, flood,
hurricane, accident or other calamity, whether or not covered by
insurance, or from any strike, labor dispute, slow down or work stoppage
or any legal or governmental proceeding, which loss or interference, in
the judgment of the Initial Purchasers individually or in the aggregate,
has had or could reasonably be expected to have a Material Adverse
Effect, or there shall have been, in the judgment of the Initial
Purchasers, any event or development that, individually or in the
aggregate, has had or could reasonably be likely to have a Material
Adverse Effect, except in each case as described in the Offering
Memorandum (exclusive of any amendment or supplement thereto);
(ii) trading in securities of the Company or in securities
generally on the New York Stock Exchange, American Stock Exchange or the
NASDAQ National Market shall have been suspended or minimum or maximum
prices shall have been established on any such exchange or market;
(iii) a banking moratorium shall have been declared by New York
or United States authorities;
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, or (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or any other national or
24
international calamity or emergency, or (C) any material change in the
financial markets of the United States which, in the case of (A), (B) or
(C) above and in the judgment of the Initial Purchasers, makes it
impracticable or inadvisable to proceed with the offering or the
delivery of the Shares as contemplated by the Offering Memorandum; or
(v) any securities of the Company shall have been downgraded or
placed on any "watch list" for possible downgrading by any nationally
recognized statistical rating organization.
(b) Termination of this Agreement pursuant to this Section 11
shall be without liability of any party to any other party except as provided in
Section 10 hereof.
12. Information Supplied by the Initial Purchasers. The
statements set forth in the last paragraph on the front cover page and in the
third and fourth sentences of the third paragraph and in the seventh paragraph
under the heading "Plan of Distribution" in the Offering Memorandum constitute
the only information furnished by the Initial Purchasers to the Company for the
purposes of Sections 2(a)(i) and 9 hereof.
13. Notices. All communications hereunder shall be in writing
and, if sent to the Initial Purchasers, shall be mailed or delivered to TD
Securities (USA) Inc., ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., Managing Director with a copy to Shearman &
Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇▇▇, Esq.; if sent to the Company, shall be mailed or delivered to the
Company at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: K. ▇▇▇▇▇ ▇▇▇▇▇,
with a copy to Shack & ▇▇▇▇▇▇, P.C., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; five business days
after being deposited in the mail, postage prepaid, if mailed; and one business
day after being timely delivered to a next-day air courier.
14. Successors. This Agreement shall inure to the benefit of and
be binding upon the Initial Purchasers, the Company and their successors and
legal representatives, and nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any other any legal or equitable right,
remedy or claim under or in respect of this Agreement, or any provisions herein
contained; this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person except that (i) the indemnities of the
Company contained in Section 9 of this Agreement shall also be for the benefit
of each director, officer, agent, representative or employee of an Initial
Purchaser and any person or persons who control the Initial Purchasers
25
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act and (ii) the indemnities of the Initial Purchasers contained in
Section 9 of this Agreement shall also be for the benefit of director, officer,
agent, representative or employee of the Company, their officers and any person
or persons who control the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act. No purchaser of Shares from
the Initial Purchasers will be deemed a successor because of such purchase.
15. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS
AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED WHOLLY THEREIN WITHOUT GIVING EFFECT TO ANY
PROVISIONS THEREOF RELATING TO CONFLICTS OF LAW.
16. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement between the Company
and the Initial Purchasers.
Very truly yours,
BENEDEK COMMUNICATIONS CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
______________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President--Finance
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written.
TD SECURITIES (USA) INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
_______________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: Managing Director
BT ALEX. ▇▇▇▇▇ INCORPORATED
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
_______________________________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
SCHEDULE 1
Initial Purchasers Number of Shares
------------------ ----------------
TD Securities (USA) Inc.......................................... 75,000
BT Alex. ▇▇▇▇▇ Incorporated...................................... 25,000
------------------
Total.................................................... 100,000
