EXHIBIT 10.35
YOUNG BROADCASTING INC.
$200,000,000
8 3/4% SENIOR SUBORDINATED NOTES DUE 2007
PURCHASE AGREEMENT
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June 16, 1997
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ World Headquarters
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
Young Broadcasting Inc., a Delaware corporation (the "Company"), and
the Guarantors (as defined below) hereby confirm their agreement with you (the
"Initial Purchaser"), as set forth below.
1. The Securities. Subject to the terms and conditions herein contained,
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the Company proposes to issue and sell to the Initial Purchaser $200,000,000
aggregate principal amount of its 8 3/4% Senior Subordinated Notes due 2007
(collectively with the Guarantees referred to below, the "Notes"). The Notes are
to be issued under an indenture (the "Indenture") to be dated as of June 15,
1997 among the Company, the Guarantors and State Street Bank and Trust Company,
as Trustee (the "Trustee"). The Notes will be unconditionally guaranteed by
Young Broadcasting of Albany, Inc., a Delaware corporation, Young Broadcasting
of La Crosse, Inc., a Wisconsin corporation, Young Broadcasting of Lansing,
Inc., a Michigan corporation, Winnebago Television Corporation, an Illinois
corporation, Young Broadcasting of Nashville, Inc., a Delaware corporation, YBT,
Inc., a Delaware corporation, WKRN, L.P., a Delaware limited partnership, Young
Broadcasting of Louisiana, Inc., a Delaware corporation, LAT, Inc., a Delaware
corporation, KLFY, L.P., a Delaware limited partnership, Young Broadcasting of
Richmond, Inc., a Delaware corporation, Young Broadcasting of
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Green Bay, Inc., a Delaware corporation, Young Broadcasting of Knoxville, Inc.,
a Delaware corporation, WATE, L.P., a Delaware limited partnership, YBK, Inc., a
Delaware corporation, Young Broadcasting of ▇▇▇▇▇▇▇▇▇, Inc., a Delaware
corporation, Young Broadcasting of Sioux Falls, Inc., a Delaware corporation,
Young Broadcasting of Rapid City, Inc., a Delaware corporation, Young
Broadcasting of Los Angeles, a Delaware corporation, Fidelity Television, Inc.,
a California corporation, and any Additional Guarantors (as defined in the Final
Memorandum as defined below) (collectively, the "Guarantors") pursuant to the
terms of the Indenture (the "Guarantees").
The Notes will be offered and sold to the Initial Purchaser without
being registered under the Securities Act of 1933, as amended (the "Act"), in
reliance on exemptions therefrom.
In connection with the sale of the Notes, the Company and the
Guarantors have prepared a final offering memorandum dated June 16, 1997 (the
"Final Memorandum") setting forth or including a description of the terms of the
Notes and the offering of the Notes, the Company, the Guarantors and any
material developments relating to the Company and the Guarantors occurring after
the date of the most recent historical financial statements included therein.
The Initial Purchaser and its direct and indirect transferees of the
Notes will be entitled to the benefits of a Registration Rights Agreement,
substantially in the form attached hereto as Exhibit A (the "Registration Rights
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Agreement"), pursuant to which the Company and the Guarantors will agree, among
other things, to file with the Securities and Exchange Commission (the
"Commission") under the circumstances set forth therein (i) a registration
statement under the Act relating to the Company's 8 3/4% Senior Subordinated
Notes due 2007 (the "Exchange Notes") to be offered in exchange for the Notes
and to use their best efforts to cause such registration statement to be
declared effective, or (ii) under certain circumstances, as expressly provided
therein, a shelf registration statement pursuant to Rule 415 under the Act
relating to the resale of the Notes by holders thereof or, if applicable,
relating to the resale of debt securities of the Company substantially identical
to the Notes (the "Private Exchange Notes") by the Initial Purchaser pursuant
to an exchange of the Notes for Private Exchange Notes, and to use their best
efforts to cause such shelf registration statement to be declared effective.
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2. Representations and Warranties. The Company and the Guarantors,
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jointly and severally, represent and warrant to and agree with the Initial
Purchaser that:
(a) Neither the Final Memorandum nor any amendment or supplement thereto as of
the date thereof and at all times subsequent thereto up to the Closing Date
(as defined in Section 3 below) contained or contains any untrue statement
of a material fact or omitted or omits to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, except that the representations and
warranties set forth in this Section 2(a) do not apply to statements or
omissions made in reliance upon and in conformity with information relating
to the Initial Purchaser furnished to the Company or the Guarantors in
writing by the Initial Purchaser expressly for use in the Final Memorandum
or any amendment or supplement thereto.
(b) As of the Closing Date, the Company will have the authorized, issued and
outstanding capitalization set forth in the Final Memorandum under the "as
adjusted" column below the caption "Capitalization"; all of the outstanding
shares of capital stock of the Company and the corporate Guarantors have
been, and as of the Closing Date will be, duly authorized and validly
issued, are fully paid and nonassessable and were not issued in violation
of any preemptive or similar rights; except as set forth in the Final
Memorandum, all of the outstanding shares of capital stock of or
partnership interests in, as the case may be, the Guarantors are, and as of
the Closing Date will be, owned, directly or indirectly, by the Company,
free and clear of all liens, encumbrances, equities and claims or
restrictions on transferability (other than those imposed by the Act and
the securities or "Blue Sky" laws of certain jurisdictions) or voting;
except as set forth in the Final Memorandum, there are no (i) options,
warrants or other rights to purchase from the Company or any Guarantor
shares of capital stock of or partnership or other ownership interests in,
as the case may be, the Company or any Guarantor outstanding, (ii)
agreements or other obligations of the Company or any Guarantor to sell
such shares or interests or (iii) other rights to convert any obligation
into, or exchange any securities for, such shares or interests. All of the
issued and outstanding partnership interests of each
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partnership Guarantor have been, and as of the Closing Date will be, duly
authorized and validly issued and were not issued in violation of any
preemptive or similar rights. Except for the Guarantors or as disclosed in
the Final Memorandum, the Company does not own, directly or indirectly, any
shares of capital stock of, or any other equity securities in, any firm,
partnership, joint venture or other entity which shares or equity
securities entitle the Company to elect at least a majority of the board of
directors or other governing body of such firm, partnership, joint venture
or other entity.
(c) Each of the Company and the corporate Guarantors has been duly
incorporated, is validly existing and is in good standing as a corporation
under the laws of its jurisdiction of incorporation, with all requisite
corporate power and authority to own its properties and conduct its
business as now conducted, and as described in the Final Memorandum; each
of the Company and the corporate Guarantors is duly qualified to do
business as a foreign corporation in good standing in all other
jurisdictions where the ownership or leasing of its properties or the
conduct of its business requires such qualification, except where the
failure to be so qualified would not, individually or in the aggregate,
have a material adverse effect on the general affairs, management,
business, condition (financial or otherwise), prospects or results of
operations of the Company and the Guarantors, taken as a whole (any such
event, a "Material Adverse Effect"). Each of the partnership Guarantors
has been duly formed, is validly existing and is in good standing as a
limited partnership under the laws of the jurisdiction of its organization,
with all requisite partnership power and authority to own its property and
conduct its business as now conducted, and as described in the Final
Memorandum; each partnership Guarantor is duly qualified or registered to
transact business in each jurisdiction in which the conduct of its business
or its ownership or leasing of property requires such qualification or
registration, except to the extent that the failure to be so qualified or
registered would not, individually or in the aggregate, have a Material
Adverse Effect. All necessary filings with respect to the formation of the
partnership Guarantors as limited partnerships have been made.
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(d) The Company has all requisite corporate power and authority to execute,
deliver and perform each of its obligations under the Notes, the Exchange
Notes and the Private Exchange Notes. The Notes, the Exchange Notes and
the Private Exchange Notes have each been duly and validly authorized by
the Company and, when executed by the Company and authenticated by the
Trustee in accordance with the provisions of the Indenture and, in the case
of the Notes, when delivered to and paid for by the Initial Purchaser in
accordance with the terms of this Agreement, will have been duly executed,
issued and delivered and will constitute valid and legally binding
obligations of the Company, entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms, except that
the enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and (ii) general principles of
equity and the discretion of the court before which any proceeding therefor
may be brought.
(e) Each of the Guarantors has all requisite corporate or partnership power and
authority, as the case may be, to execute, deliver and perform each of its
obligations under the Guarantees. The Guarantees endorsed on the Notes,
the Exchange Notes and the Private Exchange Notes have each been duly and
validly authorized by each of the Guarantors and, when the Notes, the
Exchange Notes and the Private Exchange Notes are executed by the Company
and each of the Guarantors and authenticated by the Trustee in accordance
with the provisions of the Indenture and, in the case of the Notes,
delivered to and paid for by the Initial Purchaser in accordance with the
terms of this Agreement, will constitute valid and legally binding
obligations of each of the Guarantors, entitled to the benefits of the
Indenture and enforceable against the Guarantors in accordance with their
terms, except that the enforcement thereof may be subject to (i)
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors'
rights generally and (ii) general principles of equity and the discretion
of the court before which any proceeding therefor may be brought.
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(f) The Company and each of the Guarantors have all requisite corporate or
partnership power and authority, as the case may be, to execute, deliver
and perform each of their obligations under the Indenture. The Indenture
meets the requirements for qualification under the Trust Indenture Act of
1939, as amended (the "TIA"). The Indenture has been duly and validly
authorized by the Company and each of the Guarantors and, when executed and
delivered by the Company and each of the Guarantors (assuming the due
authorization, execution and delivery by the Trustee), will constitute a
valid and legally binding agreement of the Company and each of the
Guarantors, enforceable against the Company and each of the Guarantors in
accordance with its terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity and the discretion of the
court before which any proceeding therefor may be brought.
(g) The Company and each of the Guarantors have all requisite corporate or
partnership power and authority, as the case may be, to execute, deliver
and perform each of their obligations under the Registration Rights
Agreement. The Registration Rights Agreement has been duly and validly
authorized by the Company and each of the Guarantors and, when executed and
delivered by the Company and each of the Guarantors, will constitute a
valid and legally binding obligation of the Company and each of the
Guarantors enforceable against the Company and each of the Guarantors in
accordance with its terms, except that (A) the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity and the discretion of the
court before which any proceeding therefor may be brought and (B) any
rights to indemnity or contribution thereunder may be limited by federal
and state securities laws and public policy considerations.
(h) The Amended and Restated Credit Agreement, dated as of November 15, 1996,
among the Company, the lenders named therein, ▇▇▇▇▇▇ Guaranty Trust Company
of New York, as Syndication Agent, Canadian Imperial Bank
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of Commerce, as Documentation Agent and Bankers Trust Company, as
Administrative Agent and Issuing Bank, as amended to the date hereof(the
"Credit Agreement"), has been duly and validly authorized by the Company
and constitutes a valid and legally binding agreement of the Company in
accordance with its terms, except that the enforcement thereof may be
subject to (a) bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (b) general principles of
equity and the discretion of any court before which any proceeding therefor
may be brought.
(i) The Company and each of the Guarantors have all requisite corporate or
partnership power and authority, as the case may be, to execute, deliver
and perform each of their obligations under this Agreement and to
consummate the transactions contemplated hereby. This Agreement has been
duly and validly authorized, executed and delivered by the Company and each
of the Guarantors. No consent, approval, authorization or order of any
court or governmental agency or body (including, without limitation, the
Federal Communications Commission (the "FCC")) is required for the
performance of this Agreement by the Company or the Guarantors or the
consummation by the Company and the Guarantors of the transactions
contemplated hereby, except such as have been obtained and other than such
as may be required under state securities or "Blue Sky" laws in connection
with the purchase and resale of the Notes by the Initial Purchaser. None
of the Company or the Guarantors is (i) in violation of its certificate of
incorporation or bylaws (or similar organizational document (including any
partnership agreement or certificate of limited partnership)), (ii) in
violation of any statute, judgment, decree, order, rule or regulation
applicable to any of them or any of their respective properties or assets
(including, without limitation, the Communications Act of 1934, as amended
(the "Communications Act") and the rules and regulations of the FCC
thereunder), except for any such violation which would not, individually or
in the aggregate, have a Material Adverse Effect, or (iii) in breach or
default in the performance or observance of (nor has any event occurred
which, with notice or passage of time or both, would constitute a default
under) any obligation, agreement, covenant or condition contained in any
in-
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denture, mortgage, deed of trust, loan agreement, note, lease, license,
franchise agreement, permit, certificate, contract or other agreement or
instrument to which any of them is a party or to which any of them or their
respective properties or assets is subject (including, without limitation,
those relating to the Communications Act), except for any such breach,
default or event which would not, individually or in the aggregate, have a
Material Adverse Effect.
(j) The execution, delivery and performance by the Company and each of the
Guarantors of this Agreement and the consummation by the Company and each
of the Guarantors of the transactions contemplated hereby, and the
fulfillment of the terms hereof, 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
or cause the revocation or termination of (i) any indenture, mortgage, deed
of trust, loan agreement, note, lease, license, franchise agreement,
permit, certificate, contract or other agreement or instrument to which the
Company or any of the Guarantors is a party or to which any of them or
their respective properties or assets is subject (including, without
limitation, those relating to the Communications Act), except for any such
conflict, breach, violation, default, event, revocation or termination
which would not, individually or in the aggregate, have a Material Adverse
Effect, (ii) the certificate of incorporation or bylaws (or similar
organizational document (including any partnership agreement or certificate
of limited partnership)) of the Company or any of the Guarantors, 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 Purchaser in Section 8 hereof) any statute, judgment, decree,
order, rule or regulation applicable to the Company or any of the
Guarantors or any of their respective properties or assets (including,
without limitation, the Communications Act and the rules and regulations of
the FCC thereunder), except for any such conflict, breach or violation
which would not, individually or in the aggregate, have a Material Adverse
Effect.
(k) The audited consolidated financial statements of the Company and its
subsidiaries included in the Fi-
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nal Memorandum present fairly in all material respects the financial
position, results of operations and cash flows of the Company and its
subsidiaries at the dates and for the periods to which they relate and have
been prepared in accordance with generally accepted accounting principles
applied on a consistent basis, except as otherwise stated therein and the
unaudited consolidated financial statements of the Company and its
subsidiaries included in the Final Memorandum are presented on a consistent
basis with such audited consolidated financial statements except that they
do not contain footnotes, are subject to normal year-end adjustments and
are in conformity with generally accepted accounting principles as in
effect on December 31, 1996. The summary and selected financial and
statistical data in the Final Memorandum present fairly in all material
respects the financial 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. Ernst & Young LLP
(the "Independent Auditors") is an independent public accounting firm
within the meaning of the Act and the rules and regulations promulgated
thereunder.
(l) The pro forma financial information included in the Final Memorandum 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 Final Memorandum are reasonable and
the adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein.
(m) There is not pending or, to the best knowledge of the Company or any
Guarantor, threatened any action, suit, proceeding, inquiry or
investigation to which the Company or any of the Guarantors is a party, or
to which the property or assets of the Company or any of the Guarantors are
subject, before or brought by any court or governmental agency or body
which would be required to be described in a prospectus that is subject to
Item 103 of Regulation S-K under the Act, or which seeks to restrain,
enjoin, prevent the consummation of or otherwise challenge the issuance or
sale of the Notes to be sold hereunder or the consummation of the other
transactions described in the Final Memorandum under the caption "Use of
Proceeds."
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(n) Each of the Company and the Guarantors 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, without limitation, the
FCC), 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 respective properties and to carry on its respective businesses
as now or proposed to be conducted as set forth in the Final Memorandum,
except where the failure to obtain such licenses, permits, certificates,
consents, orders, approvals and other authorizations, or to make all
declarations and filings, would not, individually or in the aggregate, have
a Material Adverse Effect, and none of the Company or the Guarantors has
received any notice of any proceeding relating to revocation or
modification of any such license, permit, certificate, consent, order,
approval or other authorization, except as described in the Final
Memorandum and except where such revocation or modification would not,
individually or in the aggregate, have a Material Adverse Effect. The
licenses issued to the Company and the Guarantors by the FCC (the
"Licenses") are valid and in full force and effect with no restrictions or
qualifications which would have a Material Adverse Effect. No event has
occurred which permits, or with notice or lapse of time or both would
permit, and no legal governmental proceeding has been instituted or
threatened which could cause, the revocation or termination of any of the
Licenses or which might result in any other impairment or modification of
the rights of the Company or any Guarantor therein which in any such case
would have a Material Adverse Effect. Except as described in the Final
Memorandum, the Company has no reason to believe that any License issued by
the FCC will not be renewed in the ordinary course.
(o) Since the respective dates as of which information is given in the Final
Memorandum, except as described or contemplated therein, (i) none of the
Company or any of the Guarantors has 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 and (ii) none of the Company or any of the Guarantors has
purchased any of its outstanding capital stock (other than pursuant to the
Company's existing stock repurchase program), nor declared, paid or
otherwise made any dividend or distribution of any kind on its capital
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stock (other than with respect to any such Guarantor, the purchase of, or
dividend or distribution on, capital stock owned by the Company).
(p) Each of the Company and the Guarantors has filed all necessary federal,
state and foreign income and franchise tax returns required to be filed
prior to the date hereof, except where the failure to so file such returns
would not, individually or in the aggregate, have a Material Adverse
Effect, and has paid all taxes shown as due thereon; and other than tax
deficiencies which the Company or any Guarantor is contesting in good faith
and for which the Company or such Guarantor has provided adequate reserves,
there is no tax deficiency that has been asserted against the Company or
any of the Guarantors that would have, individually or in the aggregate, a
Material Adverse Effect.
(q) None of the Company, the Guarantors or any agent acting on their behalf has
taken or will take any action that might cause this Agreement or the sale
of the Notes to violate Regulation G, T, U or X of the Board of Governors
of the Federal Reserve System, in each case as in effect, or as the same
may hereafter be in effect, on the Closing Date.
(r) Each of the Company and the Guarantors has good, sufficient and legal title
to all real property and good title to all personal property described in
the Final Memorandum as being owned by it and good, sufficient and legal
title to a leasehold estate in the real and personal property described in
the Final Memorandum as being leased by it free and clear of all liens,
charges, encumbrances or restrictions, except as described in the Final
Memorandum or to the extent the failure to have such title or the existence
of such liens, charges, encumbrances or restrictions would not,
individually or in the aggregate, have a Material Adverse Effect. All
leases, contracts and agreements to which the Company or any of the
Guarantors is a party or by which any of them is bound are valid and
enforceable against the Company or such Guarantor, and are valid and
enforceable against the other party or parties thereto and are in full
force and effect with only
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such exceptions as would not, individually or in the aggregate, have a
Material Adverse Effect.
(s) Except as described in the Final Memorandum, each of the Company and the
Guarantors is in compliance in all material respects with all laws, rules
or regulations relating to pollution or protection of public or employee
health or the environment ("Environmental Law") and with the terms and
conditions of any permit, license or approval required thereunder in
connection with the ownership, operation or use of its business, property
and assets where the failure to be in such compliance could reasonably be
expected to have, individually or in the aggregate, a Material Adverse
Effect; except as disclosed in the Final Memorandum, none of the Company or
the Guarantors is subject to any liability, absolute or contingent, under
any Environmental Law which liability would, individually or in the
aggregate, have a Material Adverse Effect; except as disclosed in the Final
Memorandum, there is no civil, criminal or administrative action, suit,
demand, hearing, notice of violation or deficiency, investigation,
proceeding or notice of potential responsibility or demand letter or
request for information pending or threatened against the Company or any of
the Guarantors under any Environmental Law which, if determined adversely
to the Company or any such Guarantors would, individually or in the
aggregate, result in a Material Adverse Effect.
(t) Except as set forth in the Final Memorandum, there is no strike, labor
dispute, slowdown or work stoppage with the employees of the Company or any
of the Guarantors which is pending or, to the best knowledge of the Company
or any Guarantor, threatened.
(u) Each of the Company and the Guarantors carries insurance (including self
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.
(v) None of the Company or the Guarantors has any liability for any prohibited
transaction or funding deficiency or any complete or partial withdrawal
liability with respect to any pension, profit sharing or other plan which
is subject to the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), to
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which the Company or any Guarantor makes or ever has made a contribution
and in which any employee of the Company or any Guarantor is or has ever
been a participant. With respect to such plans, the Company and each
Guarantor is in compliance in all material respects with all applicable
provisions of ERISA.
(w) None of the Company or the Guarantors will be an "investment company" or
"promoter" or "principal underwriter" for an "investment company," as such
terms are defined in the Investment Company Act of 1940, as amended, and
the rules and regulations thereunder.
(x) The Notes, the Exchange Notes, the Indenture and the Registration Rights
Agreement will, when executed, and this Agreement and the Credit Agreement
do, conform in all material respects to the descriptions thereof in the
Final Memorandum.
(y) No holder of securities of the Company or any Guarantor 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.
(z) After the consummation of the transactions contemplated by this Agreement,
the fair value and present fair salable value of the assets of the Company
and the Guarantors (on a consolidated basis) will exceed the sum of their
stated liabilities and identified contingent liabilities (on a consolidated
basis); the Company and the Guarantors (on a consolidated basis) are not,
and the Company and the Guarantors (on a consolidated basis) 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 their
business as it is proposed to be conducted, (b) unable to pay their debts
(contingent or otherwise) as they mature or (c) otherwise insolvent.
(aa) The affiliation agreements between each of the broadcast television
stations of the Company and the Guarantors, as applicable, and the ABC
Television Network, the CBS Television Network and the NBC Television
Network, as applicable, have been duly authorized, executed and delivered
by the Company and the Guaran-
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tors, as applicable, and are the valid and legally binding obligations of
the respective parties thereto and the description of such affiliation
agreements in the Final Memorandum under the caption "Business -- Network
Affiliation Agreements" is a fair and accurate summary thereof.
(bb) None of the Company, the Guarantors or any of their respective Affiliates
(as defined in Rule 501(b) of Regulation D under the Act) has directly, or
through any agent, (i) sold, offered for sale, solicited offers to buy or
otherwise negotiated in respect of, any "security" (as defined in the Act)
which is or will be integrated with the sale of the Notes in a manner that
would require the registration under the Act of the Notes or (ii) engaged
in any form of general solicitation or general advertising in connection
with the offering of the Notes (as those terms are used in Regulation D
under the Act) or in any manner involving a public offering within the
meaning of Section 4(2) of the Act.
(cc) Assuming the accuracy of the representations and warranties of the Initial
Purchaser in Section 8 hereof, it is not necessary in connection with the
offer, sale and delivery of the Notes to the Initial Purchaser in the
manner contemplated by this Agreement to register any of the Notes under
the Act or to qualify the Indenture under the TIA.
(dd) No securities of the Company or any Guarantor are of the same class (within
the meaning of Rule 144A under the Act) as the Notes and listed on a
national securities exchange registered under Section 6 of the Exchange
Act, or quoted in a U.S. automated inter-dealer quotation system.
(ee) None of the Company or the Guarantors 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 Notes.
(ff) None of the Company, the Guarantors, any of their respective Affiliates or
any person acting on its or their behalf (other than the Initial Purchaser)
has engaged in any directed selling efforts (as that term is defined in
Regulation S under the Act ("Regula-
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tion S")) with respect to the Notes and the Company, the Guarantors and
their respective Affiliates and any person acting on its or their behalf
(other than the Initial Purchaser) have acted in accordance with the
offering restrictions requirement of Regulation S.
3. Purchase, Sale and Delivery of the Notes. On the basis of the
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representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, each of the Company and
the Guarantors agrees to issue and sell to the Initial Purchaser, and the
Initial Purchaser agrees to purchase from the Company and the Guarantors the
entire principal amount of the Notes at a purchase price of 99.12% of the
principal amount thereof. Certificates in definitive form for the Notes that
the Initial Purchaser have agreed to purchase hereunder, and in such
denomination or denominations and registered in such name or names as the
Initial Purchaser request upon notice to the Company at least two business days
prior to the Closing Date, shall be delivered by or on behalf of the Company and
the Guarantors to the Initial Purchaser, against payment by or on behalf of the
Initial Purchaser of the purchase price therefor by wire transfer of same day or
immediately available 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. The Company agrees to reimburse the Initial
Purchaser for the cost of obtaining such same day or immediately available
funds. The Company has requested that due to certain circumstances beyond its
control that the delivery of and payment for the Notes be made at the offices of
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, at 10:00
A.M., New York time, on June 23, 1997, or at such other place, time or date as
the Initial Purchaser and the Company may agree upon, such time and date of
delivery against payment being herein referred to as the "Closing Date." Upon
completion of such delivery and payment the offer and sale of the Notes to the
Initial Purchaser will be declared completed (the "Closing"). The Company and
the Guarantors will make such certificate or certificates for the Notes
available for checking and packaging by the Initial Purchaser at its offices in
New York, New York at least one business day prior to the Closing Date.
4. Offering by the Initial Purchaser. The Initial Purchaser proposes
---------------------------------
to make an offering of the Notes at the price and upon the terms set forth in
the Final Memorandum, as soon as practicable after this Agreement is entered
into and as in the judgment of the Initial Purchaser is advisable.
-16-
5. Covenants of the Company and the Guarantors. Each of the Company and
-------------------------------------------
the Guarantors jointly and severally covenants and agrees with the Initial
Purchaser that:
(a) The Company and the Guarantors will not amend or supplement the Final
Memorandum or any amendment or supplement thereto of which the Initial
Purchaser 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 Purchaser shall not have given their consent, which
will not be unreasonably withheld. The Company and the Guarantors will
promptly, upon the reasonable request of the Initial Purchaser or counsel
for the Initial Purchaser, make any amendments or supplements to the Final
Memorandum that may be necessary or advisable in connection with the resale
of the Notes by the Initial Purchaser.
(b) The Company and the Guarantors will cooperate with the Initial Purchaser in
arranging for the qualification of the Notes for offering and sale under
the securities or "Blue Sky" laws of such jurisdictions as the Initial
Purchaser may reasonably designate and will continue such qualifications in
effect for as long as may be necessary to complete the resale of the Notes;
provided, however, that in connection therewith, neither of the Company nor
-------- -------
any Guarantor shall be required to qualify as a foreign corporation or to
execute a general consent to service of process in any jurisdiction or
subject itself to taxation in excess of a nominal dollar amount in any such
jurisdiction where it is not then so subject.
(c) If, at any time prior to the completion of the initial resale by the
Initial Purchaser of the Notes, any event occurs as a result of which the
Final 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 Final Memorandum to comply with
applicable law, the Company and the Guarantors will promptly notify the
Initial Purchaser thereof and will prepare, at their expense, an amendment
or supplement to the Fin-
-17-
al Memorandum that corrects such statement or omission or effects such
compliance.
(d) The Company and the Guarantors will, without charge, provide to the Initial
Purchaser and to counsel for the Initial Purchaser as many copies of the
Final Memorandum or any amendment or supplement thereto as the Initial
Purchaser may reasonably request.
(e) The Company will apply the net proceeds from the sale of the Notes as set
forth under "Use of Proceeds" in the Final Memorandum.
(f) For and during the period ending on the date no Notes are outstanding, the
Company and the Guarantors will furnish to the Initial Purchaser copies of
all reports and other communications (financial or otherwise) furnished by
the Company or the Guarantors to the Trustee or the holders of the Notes
and, as soon as available, copies of any reports or financial statements
furnished to or filed by the Company or the Guarantors with the Commission
or any national securities exchange on which any class of securities of the
Company or the Guarantors may be listed.
(g) Prior to the Closing Date, the Company will furnish to the Initial
Purchaser, 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
Final Memorandum.
(h) Neither of the Company nor 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 Act) which could be integrated with the sale
of the Notes in a manner which would require the registration under the Act
of the Notes.
(i) The Company and the Guarantors will not solicit any offer to buy or offer
to sell the Notes by means of any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) or in
any manner involving a public offering within the meaning of Section 4(2)
of the Act.
(j) For so long as any of the Notes remain outstanding and are "restricted
securities" within the
-18-
meaning of Rule 144(a)(3) under the Act, the Company and the Guarantors
will make available, upon request, to any seller of such Notes the
information specified in Rule 144A(d)(4) under the Act, unless the Company
and the Guarantors are then subject to Section 13 or 15(d) of the Exchange
Act.
(k) Each of the Company and the Guarantors will use its best efforts to (i)
permit the Notes to be designated PORTAL securities in accordance with the
rules and regulations adopted by the NASD relating to trading in the PORTAL
Market and (ii) permit the Notes to be eligible for clearance and
settlement through The Depository Trust Company.
(l) The Company and the Guarantors shall promptly prepare the Final Memorandum
and will cooperate with and assist the Initial Purchaser in connection with
the marketing and sale of the Notes consistent with standards customary in
the marketing and sale of similar securities, including, without
limitation, the provision of information reasonably requested by the
Initial Purchaser and the performance of all "roadshow" activities
(including, without limitation, making available to the Initial Purchaser
and prospective investors in the Notes management, accountants and others
reasonably requested by the Initial Purchaser).
6. Expenses. The Company and the Guarantors agree, jointly and
--------
severally, to pay all costs and expenses incident to the performance of their
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,
including any costs of printing the Final Memorandum and any amendment or
supplement thereto, and any "Blue Sky" memoranda, (ii) all arrangements relating
to the delivery to the Initial Purchaser 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 Purchaser of the Notes, (v) the
qualification of the Notes under state securities and "Blue Sky" laws in
accordance with Section 5(b) hereof, including filing fees and fees and
disbursements of counsel for the Initial Purchaser relating thereto, (vi)
expenses in connection with any meetings with prospective investors in the
Notes, ex-
-19-
cept to the extent that the parties hereto agree otherwise, (vii) fees and
expenses of the Trustee, including fees and expenses of its counsel, (viii) all
expenses and listing fees incurred in connection with the application for
quotation of the Notes on the PORTAL Market and (ix) any fees charged by
investment rating agencies for the rating of the Notes. If the sale of the Notes
provided for herein is not consummated because any condition to the obligations
of the Initial Purchaser 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 or any Guarantor to perform all obligations and satisfy
all conditions on their part to be performed or satisfied hereunder (other than
solely by reason of a default by the Initial Purchaser of its obligations
hereunder after all conditions hereunder have been satisfied in accordance
herewith), the Company and the Guarantors jointly and severally agree to
promptly reimburse the Initial Purchaser upon demand for all reasonable out-of-
pocket expenses (including fees, disbursements and charges of ▇▇▇▇▇▇ ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, counsel for the Initial Purchaser) that shall have been incurred by the
Initial Purchaser in connection with the proposed purchase and sale of the
Notes. The Company and the Guarantors shall not be liable to the Initial
Purchaser for loss of contemplated profits from the transactions covered by this
Agreement.
7. Conditions of the Initial Purchaser' Obligations. The obligation of
------------------------------------------------
the Initial Purchaser to purchase and pay for the Notes shall, in its sole
discretion, be subject to satisfaction or waiver of the following conditions:
(a) On the Closing Date, the Initial Purchaser shall have received the opinion,
dated as of the Closing Date and addressed to the Initial Purchaser, of
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C., counsel for the Company
and the Guarantors, in form and substance satisfactory to counsel for the
Initial Purchaser, to the effect that:
(i) Each of the Company and the corporate Guarantors is duly incorporated,
validly existing and in good standing under the laws of its respective
jurisdiction of incorporation and has all requisite corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Final Memorandum. Each of the Company and the
corporate Guarantors is duly qualified as a foreign corporation and in good
standing in each jurisdiction where the ownership or leasing of its
-20-
properties or the conduct of its business requires such qualification,
except where the failure to be so qualified would not, individually or in
the aggregate, have a Material Adverse Effect.
(ii) Each partnership Guarantor has been duly formed and is validly existing as
a limited partnership under the laws of the jurisdiction of its
organization, has the partnership power and authority to own its property
and to conduct its business as described in the Final Memorandum and is
duly qualified or registered to transact business in each jurisdiction in
which the conduct of its business or its ownership or leasing of property
requires such qualification or registration, except to the extent that the
failure to be so qualified or registered would not, individually or in the
aggregate, have a Material Adverse Effect; all necessary filings with
respect to the formation of the partnership Guarantors as limited
partnerships have been made; and all the issued and outstanding partnership
interests of each partnership Guarantor have been duly authorized and
validly issued and to such counsel's knowledge were not issued in violation
of any preemptive or similar rights.
(iii)The Company has the authorized, issued and outstanding capitalization set
forth in the Final Memorandum under the "as adjusted" column below the
caption "Capitalization"; all of the outstanding shares of capital stock of
the Company and the corporate Guarantors have been duly authorized and
validly issued, are fully paid and nonassessable and, to the knowledge of
such counsel, were not issued in violation of any preemptive or similar
rights; except as set forth in the Final Memorandum, all of the outstanding
shares of capital stock of or partnership interests in, as the case may be,
the Guarantors are owned, directly or indirectly, by the Company, free and
clear of all perfected security interests and, to the knowledge of such
counsel, free and clear of all other liens, encumbrances, equities and
claims or restrictions on transferability (other than those imposed by the
Act and the securities or "Blue Sky" laws of certain jurisdictions) or
voting.
(iv) Except as set forth in the Final Memorandum, to the knowledge of such
counsel (A) no options,
-21-
warrants or other rights to purchase from the Company or any Guarantor
shares of capital stock of or partnership or other ownership interests in,
as the case may be, the Company or any Guarantor are outstanding, (B) no
agreements or other obligations of the Company or any Guarantor to issue,
or other rights to cause the Company or any Guarantor to convert, any
obligation into, or exchange any securities for, shares of capital stock of
or partnership or other ownership interests in, as the case may be, the
Company or any Guarantor are outstanding and (C) no holder of securities of
the Company or any Guarantor is entitled to have such securities registered
under a registration statement filed under the Act.
(v) The Notes are in the form contemplated by the Indenture. The Notes, the
Exchange Notes and the Private Exchange Notes have each been duly and
validly authorized by the Company and when executed (and assuming the due
authorization, execution and delivery of the Indenture by the Trustee and
the execution, delivery and authentication of the Notes, the Exchange Notes
and the Private Exchange Notes by the Trustee in accordance with the
Indenture) and delivered by the Company and, in the case of the Notes, paid
for by the Initial Purchaser in accordance with the terms of this
Agreement, will constitute the valid and legally binding obligations of the
Company enforceable against the Company in accordance with their terms,
subject to applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium and similar laws affecting creditors' rights and
remedies generally and subject, as to enforceability, to general principles
of equity (regardless of whether a proceeding is sought in equity or at
law), and except that such counsel need not express any opinion as to the
enforceability of the waiver as to usury, extension or stay laws.
(vi) The notations on the Notes relating to the Guarantees are in the form
contemplated by the Indenture. Each of the Guarantors has all requisite
corporate or partnership power and authority, as the case may be, to
execute, deliver and perform its obligations under the Guarantees. The
Guarantees endorsed on the Notes, the Exchange Notes and the Private
Exchange Notes have each been duly and validly authorized by each of the
Guarantors and, when the
-22-
Notes, the Exchange Notes and the Private Exchange Notes are executed by
the Company and each of the Guarantors and authenticated by the Trustee in
accordance with the provisions of the Indenture and, in the case of the
Notes, delivered to and paid for by the Initial Purchaser in accordance
with the terms of this Agreement, will constitute the valid and legally
binding obligations of each of the Guarantors, enforceable against each of
the Guarantors in accordance with their terms, subject to applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium
and similar laws affecting creditors' rights and remedies generally and
subject as to enforceability, to general principles of equity (regardless
of whether a proceeding is sought in equity or at law), and except that
such counsel need not express any opinion as to the enforceability of the
waiver as to usury, extension or stay laws.
(vii) Each of the Company and the Guarantors has all requisite
corporate or partnership power and authority, as the case may be, to
execute, deliver and perform its obligations under the Indenture and the
Notes; the Indenture is in sufficient form for qualification under the TIA;
the Indenture has been duly and validly authorized by each of the Company
and the Guarantors and, when duly executed and delivered by the Company and
the Guarantors (assuming the due authorization, execution and delivery
thereof by the Trustee), will constitute the valid and legally binding
obligation of each of the Company and the Guarantors, enforceable against
each of the Company and the Guarantors in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium and similar laws affecting creditors' rights and
remedies generally and subject, as to enforceability, to general principles
of equity (regardless of whether a proceeding is sought in equity or at
law), and except that such counsel need not express any opinion as to the
enforceability of the waiver as to usury, extension or stay laws.
(viii) Each of the Company and the Guarantors has all requisite
corporate or partnership power and authority, as the case may be, to
execute, deliver and perform its obligations under the Registration Rights
Agreement; the Registration Rights Agreement
-23-
has been duly and validly authorized by each of the Company and the
Guarantors and when duly executed and delivered by each of the Company and
the Guarantors, will constitute the valid and legally binding obligation of
each of the Company and the Guarantors, enforceable against each of the
Company and the Guarantors in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar
laws affecting creditors' rights and remedies generally and subject, as to
enforceability, to general principles of equity (regardless of whether a
proceeding is sought in equity or at law), and subject to the limitations
of federal and state securities laws and public policy considerations as to
any rights to indemnity or contribution thereunder.
(ix) The Credit Agreement has been duly and validly authorized by the Company
and each of the Guarantors and constitutes a valid and legally binding
agreement of the Company and each of the Guarantors in accordance with its
terms, except that the enforcement thereof may be subject to (a)
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors'
rights generally and (b) general principles of equity and the discretion of
any court before which any proceeding therefor may be brought.
(x) Each of the Company and the Guarantors has all requisite corporate or
partnership power and authority, as the case may be, to execute, deliver
and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby; the execution, delivery and performance
of this Agreement by the Company and the Guarantors and the consummation by
the Company and the Guarantors of the transactions contemplated hereby have
been duly and validly authorized by all necessary corporate action on the
part of the Company and each of the Guarantors. This Agreement has been
duly executed and delivered by the Company and each of the Guarantors.
(xi) The Indenture, the Notes, the Guarantees, the Credit Agreement and the
Registration Rights Agreement conform in all material respects to the
descriptions thereof contained in the Final Memorandum.
-24-
(xii) After due inquiry, such counsel does not know of any legal or
governmental proceedings pending or threatened to which any of the Company or
the Guarantors is a party or to which the property or assets of the Company or
any Guarantor is subject which would be required to be described in a prospectus
that is subject to Item 103 of Regulation S-K under the Act, or which seek to
restrain, enjoin, prevent the consummation of or otherwise challenge the
issuance or sale of the Notes to be sold hereunder or the consummation of the
other transactions described in the Final Memorandum under the caption "Use of
Proceeds."
(xiii) To the knowledge of such counsel, none of the Company or the
Guarantors is (i) in violation of its certificate of incorporation or bylaws (or
similar organizational document), (ii) in violation of any statute, judgment,
decree, order, rule or regulation applicable to any of them or any of their
respective properties or assets, except for any such violation which would not,
individually or in the aggregate, have a Material Adverse Effect, or (iii) in
breach or default in the performance or observance of (nor has any event
occurred which, with notice or passage of time or both, would constitute a
default under) any obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, note, lease, license,
franchise agreement, permit, certificate, contract or other agreement or
instrument known to such counsel (including in any event any of the foregoing
which have been filed by the Company with the Commission) to which any of them
is a party or to which any of them or their respective properties or assets is
subject, except for any such breach, default or event which would not,
individually or in the aggregate, have a Material Adverse Effect.
(xiv) The execution and delivery of this Agreement, the Indenture and
the Registration Rights Agreement and the consummation of the transactions
contemplated hereby and thereby (including, without limitation, the issuance and
sale of the Notes to the Initial Purchaser) will not conflict with or constitute
or result in a breach or violation of or a default under (or an event which with
notice or passage of time or both would constitute a default under) or
-25-
violation of any of (i) the terms or provisions of any indenture, mortgage, deed
of trust, loan agreement, note, lease, license, franchise agreement, permit,
certificate, contract or other agreement or instrument known to such counsel
(including in any event the Credit Agreement and any of the foregoing which have
been filed by the Company with the Commission) to which the Company or any of
the Guarantors is a party or to which any of them or their respective properties
or assets is subject, except for any such conflict, breach, violation, default
or event which would not, individually or in the aggregate, have a Material
Adverse Effect, (ii) the certificate of incorporation or bylaws (or similar
organizational document) of the Company or any of the Guarantors, 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
Purchaser in Section 8 hereof) any statute, judgment, decree, order, rule or
regulation known to such counsel to be applicable to the Company or any of the
Guarantors or any of their respective properties or assets, except for any such
conflict, breach or violation which would not, individually or in the aggregate,
have a Material Adverse Effect .
(xv) To the best knowledge of such counsel, no consent, approval,
authorization or order of any governmental authority is required for the
issuance and sale by the Company and the Guarantors of the Notes to the Initial
Purchaser or the other transactions contemplated hereby, except such as may be
required under Blue Sky laws, as to which such counsel need express no opinion,
and those which have previously been obtained.
(xvi) None of the Company or the Guarantors is, or immediately after
the sale of the Notes to be sold hereunder and the application of the proceeds
from such sale (as described in the Final Memorandum under the caption "Use of
Proceeds") will be, an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended.
(xvii) No registration under the Act of the Notes is required in
connection with the sale of the Notes to the Initial Purchaser as contemplated
by this Agreement and the Final Memorandum or in connec-
-26-
tion with the initial resale of the Notes by the Initial Purchaser in
accordance with Section 8 of this Agreement, and prior to the
commencement of the Exchange Offer (as defined in the Registration
Rights Agreement) or the effectiveness of the Shelf Registration
Statement (as defined in the Registration Rights Agreement), the
Indenture is not required to be qualified under the TIA, in each case
assuming (i) that the purchasers who buy the Notes in the initial
resales are qualified institutional buyers as defined in Rule 144A
promulgated under the Act ("QIBs" or "Qualified Institutional Buyers"),
or not U.S. persons (as defined in Regulation S promulgated under the
Act), (ii) the accuracy of the Initial Purchaser's representations in
Section 8 and those of the Company and the Guarantors contained in this
Agreement regarding the absence of a general solicitation or general
advertising in connection with the sale of the Notes to the Initial
Purchaser and the initial resales and (iii) the due performance by the
Initial Purchaser of the agreements set forth in Section 8 hereof.
(xviii) Neither the consummation of the transactions contemplated
by this Agreement nor the sale, issuance, execution or delivery of the
Notes will violate Regulation G, T, U or X of the Board of Governors of
the Federal Reserve System .
At the time the foregoing opinion is delivered, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C. shall additionally state that it has participated
in conferences with officers and other representatives of the Company and the
Guarantors, representatives of the independent auditors for the Company,
representatives of the Initial Purchaser and counsel for the Initial Purchaser,
at which conferences the contents of the Final Memorandum and related matters
were discussed, and, although it has not independently verified and is not
passing upon and assumes no responsibility for the accuracy, completeness or
fairness of the statements contained in the Final Memorandum (except to the
extent specified in subsection 7(a)(xi)), no facts have come to its attention
which lead it to believe that the Final Memorandum, on the date thereof or at
the Closing Date, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements contained therein, in light of the circumstances under which
-27-
they were made, not misleading (it being understood that such firm need express
no view with respect to the financial statements and related notes thereto and
the other financial, statistical, numerical and accounting data included in the
Final Memorandum). The opinion of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇,
P.C. described in this Section shall be rendered to the Initial Purchaser at the
request of the Company and the Guarantors and shall so state therein. In
rendering such opinion, counsel may state that it expresses no opinion with
respect to matters arising under the Communications Act, or the rules and
regulations of the FCC.
References to the Final Memorandum in this subsection (a) shall
include any amendment or supplement thereto prepared in accordance with the
provisions of this Agreement at the Closing Date.
(b) On the Closing Date, the Initial Purchaser shall have received the opinion
of Wiley, Rein & Fielding, communications counsel for the Company and the
Guarantors, in form and substance satisfactory to counsel for the Initial
Purchaser, to the effect that:
(i) the execution and delivery by each of the Company and the Guarantors of,
and the performance by each of the Company and the Guarantors of its
obligations under, this Agreement, the Indenture, the Notes and the
Guarantees, as applicable, did not or will not result in a violation of the
Communications Act or any order, rule or regulation of the FCC;
(ii) no consent, approval, authorization, order, registration or qualification
of or with any governmental agency or body is required under the
Communications Act or the rules and regulations of the FCC for the
execution and delivery by each of the Company and the Guarantors of, and
the performance by each of the Company and the Guarantors of its
obligations under, this Agreement, the Indenture, the Notes and the
Guarantees, as applicable;
(iii)the Company and the Guarantors are the holders of the Licenses issued by
the FCC listed in an attachment to such opinion (the "FCC Licenses"), all
of which are validly issued by the FCC and in full force and effect, with
no material restrictions or qualifications other than as described in the
Fi-
-28-
nal Memorandum and to the best of such counsel's knowledge based solely on
the description of the business and properties of the Company and the
Guarantors in the Final Memorandum and given by the Company to such
counsel, such FCC Licenses constitute all of the FCC Licenses necessary for
the Company and the Guarantors to own their properties and to conduct their
businesses in the manner and to the full extent now operated or proposed to
be operated as described in the Fi-nal Memorandum;
(iv) other than matters described in the Final Memorandum and except as to any
other matters relating to the television broadcast industry in general
which would not have a Material Adverse Effect, such counsel after due
inquiry does not know of (A) any proceedings threatened, pending or
contemplated before the FCC against or involving the properties, businesses
or FCC Licenses of the Company and the Guarantors, or (B) any
communications laws or regulations of the United States applicable to such
properties, businesses or Licenses, which in either case could have a
Material Adverse Effect;
(v) other than as described in the Final Memorandum, to the best of such
counsel's knowledge after due inquiry, no event has occurred which permits,
or with notice or lapse of time or both would permit, the revocation or
non-renewal of any of the FCC Licenses, assuming the filing of timely
license renewal applications and the timely payment of all applicable
filing and regulatory fees to the FCC, or which might result in any other
material impairment of the rights of the Company or the Guarantors in the
FCC Licenses; and
(vi) the statements in the Final Memorandum under the caption "Risk Factors-
Government Regulation" and "Business-Federal Regulation of Television
Broadcasting" insofar as such statements constitute summaries of the legal
matters, documents or proceedings referred to therein, fairly present the
information called for with respect to such legal matters, documents and
proceedings and fairly summarize the matters referred to therein and such
counsel does not believe that such statements as of the date of the Final
Memorandum and the Closing Date, contained an untrue statement of a
material fact or omitted to
-29-
state a material fact required to be stated therein or necessary to make
the statements therein not misleading.
In rendering such opinion, counsel may state that it expresses no
opinion with respect to any matters other than those arising under the
Communications Act and the published rules and regulations promulgated
thereunder by the FCC, and may rely as to all matters of fact relevant to
such opinion on certificates and written statements of officers and
employees of the Company; provided, however, that all such certificates and
--------- ---------
statements shall be satisfactory to you in all material respects and
attached to such counsel's opinion. In addition, counsel may note that
item (ii) above is qualified by the requirement to file certain corporate
and loan instruments with the FCC within 30 days of the Closing Date.
(c) On the Closing Date, the Initial Purchaser shall have received the
favorable opinion, dated as of the Closing Date and addressed to the
Initial Purchaser, of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel for the Initial
Purchaser, with respect to certain legal matters relating to this Agreement
and such other related matters as the Initial Purchaser may require. In
rendering such opinion, ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ shall have received and may
rely upon such certificates and other documents and information as it may
reasonably request to pass upon such matters.
In addition, such counsel shall additionally state that such counsel
has participated in conferences with officers and other representatives of
the Company and representatives of the independent accountants for the
Company at which conferences the contents of the Offering Memorandum and
related matters were discussed, and although such counsel has not verified
and does not pass upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Offering Memorandum, on the basis of the foregoing (relying as to
materiality to the extent such counsel deemed appropriate upon the
representations and opinions of officers and other representatives of the
Company), no facts have come to the attention of such counsel which lead
such counsel to believe that the Offering Memorandum, at the date thereof
or as of the Closing Time, contained or contains an untrue statement of a
material fact or omitted to state a material fact necessary to make the
statements therein,
-30-
in the light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express no comment
with respect to the financial statements, including the notes thereto, or
any other financial or statistical data found in or derived from the
internal accounting and other records of the Company and its subsidiaries
set forth or referred to in the Offering Memorandum).
(d) On the Closing Date, the Initial Purchaser shall have received from Ernst &
Young LLP a comfort letter or letters dated the Closing Date, in form and
substance satisfactory to counsel for the Initial Purchaser.
(e) The representations and warranties of the Company and each of the
Guarantors contained in this Agreement shall be true and correct in all
material respects as of the date hereof and as of the Closing Date; the
Company and each of the Guarantors shall have in all material respects
performed all covenants and agreements and satisfied all conditions on
their respective parts to be performed or satisfied hereunder at or prior
to the Closing Date.
(f) Subsequent to the date of the most recent financial statements in the Final
Memorandum, the Company shall not have suffered any event or circumstance
which would have a Material Adverse Effect and that makes it, in your
reasonable judgment, impracticable to market the Notes on the terms and in
the manner contemplated in the Final Memorandum.
(g) The sale of the Notes 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 Final
Memorandum, other than as described or contemplated in the Final
Memorandum, none of the Company or the Guarantors shall have incurred any
liabilities or obligations, direct or contingent (other than in the
ordinary course of business), that are material to the Company or the
Guarantors, taken as a whole, or entered into any transactions not in the
ordinary course of business that are material to the business, condition
(financial or other) or results of operations or prospects of the
-31-
Company or the Guarantors, taken as a whole, and there shall not have been
any adverse change in the capital stock or long-term indebtedness of the
Company or the Guarantors that is material to the business, condition
(financial or other) or results of operations or prospects of the Company
and the Subsidiaries, taken as a whole.
(i) Subsequent to the date of the most recent financial statements in the Final
Memorandum, the conduct of the business and operations of the Company or
the Guarantors shall not have been interfered with by strike, fire, flood,
hurricane, accident or other calamity (whether or not insured) or by any
court or governmental action, order or decree, and, except as otherwise
stated therein, the properties of the Company or the Guarantors shall not
have sustained any loss or damage (whether or not insured) as a result of
any such occurrence, except any such interference, loss or damage which
would not, individually or in the aggregate, have a Material Adverse
Effect.
(j) The Initial Purchaser shall have received certificates of the Company and
each of the Guarantors, dated the Closing Date, signed on behalf of the
Company and each of the Guarantors by their respective Chairman of the
Board, President or any Senior Vice President and the Chief Financial
Officer, to the effect that:
(i) The representations and warranties of the Company and each of the
Guarantors contained in this Agreement are true and correct in all material
respects as of the date hereof and as of the Closing Date, and the Company
and each of the Guarantors have in all material respects performed all
covenants and agreements and satisfied hereunder all conditions on their
part to be performed or satisfied hereunder at or prior to the Closing
Date;
(ii) At the Closing Date, since the date hereof or since the date of the most
recent financial statements in the Final Memorandum, no event or events
have occurred, no information has become known nor does any condition exist
that, individually or in the aggregate, would have a Material Adverse
Effect;
(iii)Since the date hereof or since the date of the most recent financial
statements in the Final
-32-
Memorandum, none of the Company or any of the Guarantors has incurred
any liabilities or obligations, direct or contingent (other than in the
ordinary course of business), that are material to the Company or the
Guarantors, or entered into any transactions not in the ordinary course
of business that are material to the business, condition (financial or
other) or results of operations or prospects of the Company or the
Guarantors, taken as a whole, and there has not been any change in the
capital stock or long-term indebtedness of the Company or the Guarantors
that is material to the business, condition (financial or other) or
results of operations or prospects of the Company or the Guarantors,
taken as a whole, except as described by the Final Memorandum; and
(iv) The sale of the Notes hereunder has not been enjoined (temporarily or
permanently).
(k) On the Closing Date, the Initial Purchaser shall have received the
Registration Rights Agreement executed by the Company and the Guarantors
and such agreement shall be in full force and effect.
On or before the Closing Date, the Initial Purchaser and counsel for
the Initial Purchaser shall have received such further documents, opinions,
certificates, letters and schedules or instruments relating to the business,
corporate, legal and financial affairs of the Company and the Guarantors as they
shall have heretofore reasonably requested from the Company and the Guarantors.
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 Purchaser and counsel for the Initial Purchaser. The Company and the
Guarantors shall furnish to the Initial Purchaser such conformed copies of such
documents, opinions, certificates, letters, schedules and instruments in such
quantities as the Initial Purchaser shall reasonably request.
8. Offering of Notes; Restrictions on Transfer. (a) The Initial
-------------------------------------------
Purchaser represents and warrants and agrees with the Company and the Guarantors
that it is a Qualified Institutional Buyer and agrees with the Company and the
Guarantors that (i) it has not and will not solicit offers for, or offer or
sell, the Notes by any form of general solicitation or offer or
-33-
general advertising (as those terms are used in Regulation D under the Act) or
in any manner involving a public offering within the meaning of Section 4(2) of
the Act; and (ii) it has solicited and will solicit offers for the Notes only
from, and will offer the Notes only to (A) in the case of offers inside the
United States, persons whom such Initial Purchaser reasonably believes to be
Qualified Institutional Buyers or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or agent,
only when such person has represented to such Initial Purchaser that each such
account is a Qualified Institutional Buyer, to whom notice has been given that
such sale or delivery is being made in reliance on Rule 144A, and, in each case,
in transactions under Rule 144A 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 that, in the case of clauses (ii)(A) and (ii)(B)
--------
above, in purchasing such Notes such persons are deemed to have made the
representations and agreed to the other provisions contained under the caption
"Transfer Restrictions" contained in the Final Memorandum.
(b) The Initial Purchaser represents, warrants and agrees with respect to
offers and sales outside the United States that:
(i) it understands that no action has been or will be taken in any jurisdiction
by it that would permit a public offering of the Notes, or possession or
distribution of any Memorandum or any other offering or publicity material
relating to the Notes, in any country or jurisdiction where action for that
purpose is required;
(ii) it has complied and will comply with all applicable laws and regulations in
each jurisdiction in which it acquires, offers, sells or delivers Notes or
has in its possession or distributes any Memorandum or any such other
material, in all cases at its own expense;
(iii)the Notes have not been and will not be registered under the Act and may
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
-34-
an exemption from the registration requirements of the Act;
(iv) it has offered the Notes and will offer and sell the Notes (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. Accordingly, neither the Initial
Purchaser, its Affiliates nor any persons acting on its or its Affiliate's
behalf have engaged or will engage in any directed selling efforts (within
the meaning of Regulation S) with respect to the Notes, and the Initial
Purchaser, its Affiliates and any such persons have complied and will
comply with the offering restrictions requirement of Regulation S;
(v) it has (A) not offered or sold, and will not offer or sell in the United
Kingdom, by means of any document, any Notes other than to persons whose
ordinary business it is to buy and sell shares or debentures, whether as a
principal or agent, or in circumstances which do not constitute an offer to
the public within the meaning of the Companies ▇▇▇ ▇▇▇▇, (B) complied and
will comply with all applicable provisions of the Financial Services ▇▇▇
▇▇▇▇ with respect to anything done by them in relation to the Notes in,
from or otherwise involving the United Kingdom, and (C) only issued or
passed on and will only issue and pass on to any persons in the United
Kingdom any document received by it in connection with the issue of the
Notes if that person is of a kind described in Article 9(3) of the
Financial Services ▇▇▇ ▇▇▇▇ (Investment Advertisements) (Exemptions) Order
1988;
(vi) it understands that the Notes have not been and will not be registered
under the Securities and Exchange Law of Japan, and represent that it has
not offered or sold, and agrees that it will not offer or sell, any Notes,
directly or indirectly, in Japan or to or from any resident of Japan except
(A) pursuant to an exemption from the registration requirements of the
Securities and Exchange Law of Japan and (B) in compliance with any other
applicable requirements of Japanese law; and
-35-
(vii) The Initial Purchaser agrees that, at or prior to confirmation
of sales of the Notes, it will have sent to each distributor, dealer or person
receiving a selling concession, fee or other remuneration that purchases Notes
from it during the restricted period a confirmation or notice to substantially
the following effec t:
"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 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 and the
--------------------------------
Guarantors, jointly and severally, agree to indemnify and hold harmless the
Initial Purchaser, and each person, if any, who controls the Initial Purchaser
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
against any losses, claims, damages or liabilities to which the Initial
Purchaser or such controlling person may become subject under the 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 Final Memorandum or any amendment or supplement
thereto or any application or other document, or any amendment or
supplement thereto, executed by the Company or any Guarantor or based upon
written information furnished by or on behalf of the Company or any
Guarantor filed in any jurisdiction in order to qualify the Notes under the
securities or "Blue Sky" laws thereof or
-36-
filed with any securities association or securities exchange (each an
"Application"); or
(ii) the omission or alleged omission to state, in the Final 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 Purchaser and each such controlling
person for any legal or other expenses incurred by the Initial Purchaser 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 and the Guarantors
--------- -------
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 Final
Memorandum or any amendment or supplement thereto or any Application in reliance
upon and in conformity with written information concerning the Initial Purchaser
furnished to the Company or the Guarantors by the Initial Purchaser specifically
for use therein. This indemnity agreement will be in addition to any liability
that the Company or the Guarantors may otherwise have to the indemnified
parties. Neither the Company nor the Guarantors shall be liable under this
Section 9 for any settlement of any claim or action effected without their
consent.
(b) The Initial Purchaser agrees to indemnify and hold harmless each of the
Company, the Guarantors, their directors, their officers and each person,
if any, who controls the Company or such Guarantor within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act against any losses,
claims, damages or liabilities to which the Company or the Guarantors or
any such director, officer or controlling person may become subject under
the 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 Final 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
Final Memorandum or any amendment or supplement thereto or any Application,
or necessary to
-37-
make the statements therein not misleading, 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 the Initial Purchaser, furnished to the
Company by such Initial Purchaser specifically for use therein; and subject
to the limitation set forth immediately preceding this clause, will
reimburse, as incurred, any legal or other expenses incurred by the Company
or any Guarantor or any such director, officer 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 Purchaser may otherwise have to the
indemnified parties. The Initial Purchaser shall not be liable under this
Section 9 for any settlement of any claim or action effected without its
consent.
(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; but the omission to so notify the indemnifying party
(i) will not relieve it 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
-38-
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 Purchaser in the case of paragraph
(a) of this Section 9 or either the Company or any of the Guarantors 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 action
effected by such indemnified party without the consent of the indemnifying
party, unless such indemnified
-39-
party waived in writing its rights under this Section 9, in which case the
indemnified party may effect such a settlement without such consent.
No indemnifying party shall, without the prior written consent of the
indemnified party, or, if such indemnified party is a person who controls the
Initial Purchaser within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, without the prior written consent of such Initial Purchaser,
effect any settlement or compromise of any pending or threatened proceeding in
respect of which any indemnified party is or could have been a party, or
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional written release of such indemnified
party, in form and substance reasonably satisfactory to such indemnified party,
from all liability on claims that are the subject matter of such proceeding.
(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 Notes
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 and the Guarantors on the one
hand and the 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 and the Guarantors bear to the total
discounts and commissions received by the Initial Purchaser. The relative
fault of the parties shall be determined by reference to, among other
-40-
things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Guarantors on the one hand, or
the Initial Purchaser on the other, the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission or alleged statement or omission, and any other
equitable considerations appropriate in the circumstances. The Company,
the Guarantors and the Initial Purchaser 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), the Initial Purchaser shall not be obligated to make
contributions hereunder that in the aggregate exceed the total discounts,
commissions and other compensation received by the Initial Purchaser under
this Agreement, less the aggregate amount of any damages that the Initial
Purchaser 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 Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
For purposes of this paragraph (d), each person, if any, who controls the
Initial Purchaser within the meaning of Section 15 of the Act or Section 20
of the Exchange Act shall have the same rights to contribution as the
Initial Purchaser, and each director of the Company and the Guarantors,
each officer of the Company and the Guarantors and each person, if any, who
controls the Company or the Guarantors within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, shall have the same rights to
contribution as the Company and the Guarantors.
10. Survival Clause. The respective representations, warranties,
---------------
agreements, covenants, indemnities and other statements of the Company and the
Guarantors, their respective officers and the Initial Purchaser 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 and the Guar -
-41-
antors, any of their respective officers or directors, the Initial Purchaser or
any controlling person referred to in Section 9 hereof and (ii) delivery of and
payment for the Notes. The respective agreements, covenants, indemnities and
other statements set forth in Sections 6 and 9 hereof shall remain in full force
and effect, regardless of any termination or cancellation of this Agreement.
11. Termination. (a) This Agreement may be terminated in the sole
-----------
discretion of the Initial Purchaser by notice to the Company given prior to the
Closing Date in the event that the Company or any of the Guarantors shall have
failed, refused or been unable to perform all obligations and satisfy all
conditions on their respective part to be performed or satisfied hereunder at or
prior thereto or, if at or prior to the Closing Date:
(i) any of the Company or the Guarantors 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 sole judgment of the
Initial Purchaser, has had or has a Material Adverse Effect, or there shall have
been, in the sole judgment of the Initial Purchaser, any Material Adverse
Change, or any event or development involving or reasonably likely to cause or
result in a Material Adverse Change (including without limitation a change in
management or control of the Company or the Guarantors), except in each case as
described in the Final 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
escala-
-42-
tion of any other insurrection or armed conflict involving the United
States or any other national or 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 sole judgment of
the Initial Purchaser, makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Notes as contemplated by
the Final 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 Purchaser. The statements set
---------------------------------------------
forth in the last paragraph on the front cover page and under the heading
"Private Placement" in the Memorandum (to the extent such statements relate to
the Initial Purchaser) constitute the only information furnished by the Initial
Purchaser to the Company for the purposes of Sections 2(a) and 9 hereof.
13. Notices. All communications hereunder shall be in writing and,
--------
if sent to the Initial Purchaser, shall be mailed or delivered or telecopied and
confirmed in writing to (i) ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated, ▇▇▇▇▇▇▇ ▇▇▇▇▇ World Headquarters, North Tower, World
Financial Center, New York, New York 10281-1305, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
Telecopier Number (▇▇▇) ▇▇▇-▇▇▇▇, with a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.,
Telecopier Number (▇▇▇) ▇▇▇-▇▇▇▇; if sent to the Company, shall be mailed or
delivered or telecopied and confirmed in writing to the Company at ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
Chairman; Telecopier Number (▇▇▇) ▇▇▇-▇▇▇▇, with a copy to ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.; Telecopier Number (▇▇▇) ▇▇▇-▇▇▇▇.
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
-43-
mail, postage prepaid, if mailed; one business day after being timely delivered
to a next-day air courier; and when receipt is acknowledged by the addressee, if
telecopied.
14. Successors. This Agreement shall inure to the benefit of and be
----------
binding upon the Initial Purchaser, the Company and the Guarantors and their
respective successors and legal representatives, and nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person any legal or equitable right, remedy or claim under or in respect of this
Agreement, or any provisions herein contained; this Agreement and all conditions
and provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that (i)
the indemnities of the Company and the Guarantors contained in Section 9 of this
Agreement shall also be for the benefit of any person or persons who control the
Initial Purchaser within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act and (ii) the indemnities of the Initial Purchaser contained in
Section 9 of this Agreement shall also be for the benefit of the directors of
the Company and the Guarantors, their respective officers and any person or who
control the Company or the Guarantors within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act. No purchaser of Notes from the Initial
Purchaser 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, WITHOUT GIVING EFFECT TO
ANY PROVISIONS 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.
-44-
If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement among the Company,
the Guarantors and the Initial Purchaser.
Very truly yours,
YOUNG BROADCASTING INC.
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF ALBANY, INC.
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF LA CROSSE, INC.
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF LANSING, INC.
By:________________________________
Name:
Title:
-▇▇-
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF NASHVILLE,INC.
By:________________________________
Name:
Title:
YBT, INC.
By:________________________________
Name:
Title:
WKRN, L.P.
By: Young Broadcasting of
Nashville, Inc., general
partner
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF LOUISIANA, INC.
By:________________________________
Name:
Title:
-46-
LAT, INC.
By:________________________________
Name:
Title:
KLFY, L.P.
By: Young Broadcasting of
Louisiana, Inc., general
partner
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF RICHMOND, INC.
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF GREEN BAY, INC.
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF KNOXVILLE, INC.
By:________________________________
Name:
Title:
-▇▇-
▇▇▇▇, ▇.▇.
By: Young Broadcasting of
Knoxville, Inc., general
partner
By:________________________________
Name:
Title:
YBK, INC.
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF ▇▇▇▇▇▇▇▇▇, INC.
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF SIOUX FALLS, INC.
By:________________________________
Name:
Title:
YOUNG BROADCASTING OF RAPID CITY, INC.
By:________________________________
Name:
Title:
-▇▇-
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇, INC.
By:________________________________
Name:
Title:
FIDELITY TELEVISION, INC.
By:________________________________
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
By:_____________________________
Name:
Title: