Exhibit 1.1
9,375,000 Shares
JOURNAL REGISTER COMPANY
COMMON STOCK, PAR VALUE $.01 PER SHARE
UNDERWRITING AGREEMENT
______ __, 1997
______ __, 1997
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Bear, Xxxxxxx & Co. Inc.
Chase Securities Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. International Limited
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxxxx Xxxxx International
Bear, Xxxxxxx International Limited
Chase Manhattan International Limited
c/o Morgan Xxxxxxx & Co. International Limited
00 Xxxxx Xxxxxx
Xxxxxx Xxxxx
Xxxxxx X00 0XX
Xxxxxxx
Dear Sirs and Mesdames:
Journal Register Company, a Delaware corporation (the "Company"),
proposes to issue and sell to the several Underwriters (as defined below)
9,375,000 shares of its common stock, par value $.01 per share
(the "Firm Shares").
It is understood that, subject to the conditions hereinafter
stated, 7,500,000 Firm Shares (the "U.S. Firm Shares") will be sold to
the several U.S. Underwriters named in Schedule I hereto (the "U.S.
Underwriters") in connection with the offering and sale of such U.S. Firm Shares
in the United States and Canada to United States and Canadian Persons (as such
terms are defined in the Agreement Between U.S. and International
Underwriters of even date herewith), and 1,875,000 Firm Shares (the
"International Shares") will be sold to the several International Underwriters
named in Schedule II hereto (the "International Underwriters") in connection
with the offering and sale of such International Shares outside the United
States and Canada to persons other than United States and Canadian Persons.
Xxxxxx Xxxxxxx & Co. Incorporated, Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation, Xxxxxxx Xxxxx, Xxxxxx Xxxxxx & Xxxxx Incorporated, Bear, Xxxxxxx &
Co. Inc. and Chase Securities Inc. shall act as representatives (the "U.S.
Representatives") of the several U.S. Underwriters, and Xxxxxx Xxxxxxx & Co.
International Limited, Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation,
Xxxxxxx Xxxxx International, Bear, Xxxxxxx International Limited and Chase
Manhattan International Limited shall act as representatives (the "International
Representatives") of the several International Underwriters. The U.S.
Underwriters and the International Underwriters are hereinafter collectively
referred to as the "Underwriters".
Warburg, Xxxxxx Capital Company, L.P. ("WPCC"), Warburg, Xxxxxx
Capital Partners, L.P. ("WPCP"), and Xxxxxxx, Xxxxxx Investors, L.P.
("Investors") are collectively referred to as the "Warburg Entities".
WPCP proposes to sell to the several U.S. Underwriters an aggregate of
not more than an additional 1,406,250 shares of common stock, par value $.01
per share of the Company (the "Additional Shares") if and to the extent
that the U.S. Representatives shall have determined to exercise, on behalf
of the U.S. Underwriters, the right to purchase such shares of common stock
granted to the U.S. Underwriters in Section 3 hereof. The Firm Shares and
the Additional Shares are hereinafter collectively referred to as the
"Shares." The shares of common stock, par value $.01 per share, of the
Company to be outstanding after giving effect to the sales contemplated
hereby are hereinafter referred to as the "Common Stock." The Company and
the Warburg Entities are hereinafter sometimes collectively referred to as
the "Sellers."
The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement relating
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to the Shares. The registration statement contains two prospectuses to be used
in connection with the offering and sale of the Shares: the U.S. prospectus, to
be used in connection with the offering and sale of Shares in the United States
and Canada to United States and Canadian Persons, and the international
prospectus, to be used in connection with the offering and sale of Shares
outside the United States and Canada to persons other than United States and
Canadian Persons. The international prospectus is identical to the U.S.
prospectus except for the outside front cover page. The registration statement
as amended at the time it becomes effective, including the information (if any)
deemed to be part of the registration statement at the time of effectiveness
pursuant to Rule 430A under the Securities Act of 1933, as amended (the
"Securities Act"), is hereinafter referred to as the "Registration Statement";
the U.S. prospectus and the international prospectus in the respective forms
first used to confirm sales of Shares are hereinafter collectively referred to
as the "Prospectus." If the Company has filed an abbreviated registration
statement to register additional shares of Common Stock pursuant to Rule 462(b)
under the Securities Act (the "Rule 462 Registration Statement"), then any
reference herein to the term "Registration Statement" shall be deemed to include
such Rule 462 Registration Statement.
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.(3) The Company
represents and warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or to the
Company's knowledge threatened by the Commission.
(b) (i) The Registration Statement, when it became effective,
did not contain and, as amended or supplemented, if applicable, will not
contain any untrue statement of a
____________________
(3) If the Company is instituting a Directed Share Program in connection with
the offering, additional provisions will be required throughout the
document.
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material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii)
the Registration Statement and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder and (iii) the Prospectus does not contain and, as amended or
supplemented, if applicable, will not contain 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, except that the representations and warranties set
forth in this paragraph 1(b) do not apply to statements or omissions in the
Registration Statement or the Prospectus based upon information relating to
any Underwriter furnished to the Company in writing by such Underwriter
through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure
to be so qualified or be in good standing would not reasonably be expected
to result in a material adverse change, in the condition, financial or
otherwise, or in the earnings, business or operations of the Company and
its subsidiaries, taken as a whole.
(d) Each subsidiary of the Company has been duly incorporated,
is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and authority to
own its property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not reasonably
be expected to result in a material adverse change, in the condition,
financial or otherwise, or in the
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earnings, business or operations of the Company and its subsidiaries, taken
as a whole; all of the issued shares of capital stock of each subsidiary of
the Company have been duly and validly authorized and issued, are fully
paid and non-assessable and are owned directly by the Company or a wholly
owned subsidiary of the Company, free and clear of all liens, encumbrances,
equities or claims.
(e) This Agreement has been duly authorized, executed and
delivered by the Company.
(f) The authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus.
(g) The shares of Common Stock (including the Shares to be sold
by the Warburg Entities hereunder) outstanding prior to the issuance of the
Shares have been duly authorized and are validly issued, fully paid and
non-assessable.
(h) The Shares to be sold by the Company have been duly
authorized and, when issued and delivered in accordance with the terms of
this Agreement, will be validly issued, fully paid and non-assessable, and
the issuance of such Shares will not be subject to any preemptive or
similar rights.
(i) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement will
not contravene any provision of applicable law or the certificate of
incorporation or by-laws of the Company or any agreement or other
instrument binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a whole, or any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary, and no consent, approval,
authorization or order of, or qualification with, any governmental body or
agency is required for the performance by the Company of its obligations
under this Agreement, except such as may be required by the securities or
Blue Sky laws of the various states in connection with the offer and sale
of the Shares.
(j) There has not occurred any material adverse change, or any
development which would reasonably be
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expected to result in a material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of the
Company and its subsidiaries, taken as a whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto subsequent
to the date of this Agreement).
(k) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its subsidiaries is
subject that are required to be described in the Registration Statement or
the Prospectus and are not so described or any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required.
(l) Each preliminary prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act, complied
when so filed in all material respects with the Securities Act and the
applicable rules and regulations of the Commission thereunder.
(m) The Company is not and, after giving effect to the offering
and sale of the Shares and the application of the proceeds thereof as
described in the Prospectus, will not be an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended.
(n) The Company and its subsidiaries (i) are in compliance with
any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits,
licenses or other approvals required of them under applicable Environmental
Laws to conduct their respective businesses and (iii) are in compliance
with all terms and conditions of any such permit, license or approval,
except where such noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to comply with the
terms and conditions of such permits, licenses or approvals would not,
singly or in the
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aggregate, be reasonably be expected to result in a material adverse
change, in the condition, financial or otherwise, or in the earnings,
business or operations of the Company and its subsidiaries, taken as a
whole.
(o) There are no contracts, agreements or understandings between
the Company and any person granting such person the right to require the
Company to file a registration statement under the Securities Act with
respect to any securities of the Company or to require the Company to
include such securities with the Shares registered pursuant to the
Registration Statement.
(p) The Company and its subsidiaries have good title in fee
simple to all real property (which to the Company's knowledge is
marketable) and own all personal property owned by them which is material
to the business of the Company and its subsidiaries, taken as a whole, in
each case free and clear of all liens, encumbrances and defects except
such as are described in the Prospectus or such as have not resulted in
and would not reasonably be expected to result in a material adverse
change, in the condition, financial or otherwise, or in the earnings,
business or operations of the Company and its subsidiaries, taken as a
whole, and do not materially interfere with the use made and proposed to
be made of such property by the Company and its subsidiaries; and any real
property and buildings held under lease by the Company and its subsidiaries
are held by them under valid, subsisting and enforceable leases except to
an extent and with such exceptions as are not material and do not materially
interfere with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries, in each case except as
described in or contemplated by the Prospectus and except as have not
resulted in, and would not reasonably be expected to result in, a
material adverse change, in the condition, financial or otherwise, or in
the earnings, business or operations of the Company and its subsidiaries,
taken as a whole.
(q) The Company and its subsidiaries own or possess, have
adequate licenses or other rights to use or can acquire on reasonable
terms, all material patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures),
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trademarks, service marks and trade names currently employed by them or
necessary to conduct their business in the manner described in the
Prospectus, and neither the Company nor any of its subsidiaries has
received any notice of infringement of or conflict with asserted rights of
others with respect to any of the foregoing which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would reasonably be expected to result in any material adverse change in
the condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole.
(r) No labor dispute with the employees of the Company or any of
its subsidiaries exists, or, to the knowledge of the Company, is imminent,
except as described in or contemplated by the Prospectus, and except as has
not resulted in, and would not reasonably be expected to result in a
material adverse change in the condition, financial or otherwise, or in the
earnings, business or operations of the Company and its subsidiaries, taken
as a whole; and the Company is not aware of any existing, threatened or
imminent labor disturbance by the employees of any of its principal
suppliers, manufacturers or contractors that would reasonably be expected
to result in any material adverse change in the condition, financial or
otherwise, or in the earnings, business or operations of the Company and
its subsidiaries, taken as a whole.
(s) The Company and each of its subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are reasonably adequate for, and customary in,
the businesses in which they are engaged.
(t) The Company and its subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or
foreign regulatory authorities necessary to conduct their respective
businesses, except as described in the Prospectus or as has not resulted
in, and would not reasonably be expected to result in a material adverse
change in the condition, financial or otherwise, or in the earnings,
business or operations of the Company and its subsidiaries, taken as a
whole. Neither the Company nor any such subsidiary has received any notice
of proceedings relating to the revocation or modification of any such
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certificate, authorization or permit which, singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, would reasonably
be expected to result in a material adverse change in the condition,
financial or otherwise, or in the earnings, business or operations of the
Company and its subsidiaries, taken as a whole, except as described in or
contemplated by the Prospectus.
(u) The Company and each of its subsidiaries maintain a system
of internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's general
or specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(v) The Company has complied with all provisions of Section
517.075, Florida Statutes relating to doing business with the Government of
Cuba or with any person or affiliate located in Cuba.
(w) The merger of Journal Register Company, LLC with and into
the Company, with the surviving entity being a Delaware corporation, and
the contribution of Integrated Newspaper Systems, Inc. to the Company have
each been consummated.
(x) The Common Stock has been approved for listing on the New
York Stock Exchange, subject to official notice of issuance.
(y) All of the information contained in the Registration
Statement and the Prospectus relating to the year of origination, year of
acquisition, or circulation of the Company's publications has been obtained
either from the books and records of the Company, in which event all of
such information is true and correct in all material respects, or from
published surveys which the Company reasonably believes are a reliable
estimate of the matters set forth therein.
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2. REPRESENTATIONS AND WARRANTIES OF WARBURG ENTITIES. Each of
the Warburg Entities represents and warrants to and agrees with each of the
Underwriters that:
(a) Such Warburg Entity has been duly organized, and is validly
existing as a limited partnership in good standing under the laws of the
State of Delaware has the power and authority to own its property and to
conduct its business and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification, except to
the extent that the failure to be so qualified or be in good standing would
not have a material adverse effect on it or materially impair its ability
to consummate the transactions contemplated hereby.
(b) To the knowledge of such Warburg Entity, all the
representations of the Company set forth in Section 1 are true and correct.
(c) This Agreement has been duly authorized, executed and
delivered by such Warburg Entity.
(d) The execution and delivery by such Warburg Entity of, and
performance by it of its obligations under, this Agreement, will not
contravene any provision of applicable law or the certificate of limited
partnership or agreement of limited partnership of such Warburg Entity or
any agreement or other instrument binding upon it, or any judgment, order
or decree of any governmental body, agency or court having jurisdiction
over it, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the
performance by it of its obligations under this Agreement, except such as
may be required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares.
(e) Such Warburg Entity has, and on the Option Closing Date (as
defined below) will have, good, valid and marketable title to the Shares to
be sold by it and the legal right and power, and all authorization and
approval required by law, to enter into this Agreement and to sell,
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transfer and deliver the Shares to be sold by it pursuant to this
Agreement.
(f) Delivery of the Shares to be sold by such Warburg Entity
pursuant to this Agreement will pass title to such Shares free and clear
of any security interests, claims, liens, equities and other encumbrances.
(g) The Registration Statement, when such Registration Statement
became effective, did not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact with
respect to the Warburg Entities or omit to state a material fact with
respect to the Warburg Entities required to be stated therein or necessary
to make the statements therein not misleading, and the Prospectus does not
contain and, as amended or supplemented, if applicable, will not contain
any untrue statement of a material fact with respect to the Warburg
Entities or omit to state a material fact with respect to the Warburg
Entities necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
3. AGREEMENTS TO SELL AND PURCHASE. The Company hereby agrees
to sell to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective numbers of Firm Shares set forth in Schedules I and II
hereto opposite its name at U.S. $____(4) a share (the "Purchase Price").
On the basis of the representations and warranties
contained in this Agreement, and subject to its terms and conditions, WPCP
agrees to sell to the U.S. Underwriters the Additional Shares,
and the U.S. Underwriters shall have a one-time right to purchase, severally and
not jointly, up to 1,406,250 Additional Shares from WPCP, up to
_____________________
(4) Insert offering price less underwriting fee, management fee and selling
concession.
(5) Three blanks should total 15% of Firm Shares.
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at the Purchase Price. If the U.S. Representatives, on behalf of the
U.S. Underwriters, elect to exercise such option, the U.S. Representatives shall
so notify the Company and the Warburg Entities in writing not later than 30 days
after the date of this Agreement, which notice shall specify the number of
Additional Shares to be purchased by the U.S. Underwriters and the date on which
such Additional Shares are to be purchased. Such date may be the same as the
Closing Date (as defined below) but not earlier than the Closing Date nor later
than ten business days after the date of such notice. Additional Shares may be
purchased as provided in Section 5 hereof solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. If any
Additional Shares are to be purchased, each U.S. Underwriter agrees, severally
and not jointly, to purchase the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as the U.S. Representative may
determine) that bears the same proportion to the total number of Additional
Shares to be purchased as the number of U.S. Firm Shares set forth in Schedule I
hereto opposite the name of such U.S. Underwriter bears to the total number of
U.S. Firm Shares.
Each of the Company and the Warburg Entities hereby agrees
that, without the prior written consent of Xxxxxx Xxxxxxx & Co. Incorporated
on behalf of the Underwriters, it will not, during the period ending 180 days
after the date of the Prospectus, (i) offer, pledge, sell, contract to sell,
sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase or otherwise transfer or
dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock
(in the case of the Warburg Entities, whether such shares or any such
securities are now owned by the Warburg Entities or are hereafter acquired)
or (ii) enter into any swap or other agreement that transfers to another, in
whole or in part, any of the economic consequences of ownership of the Common
Stock, whether any such transaction described in clause (i) or (ii) above is
to be settled by delivery of Common Stock or such other securities, in cash
or otherwise. The foregoing sentence shall not apply to (A) the Shares to be
sold hereunder, (B) the issuance by the Company of shares of Common Stock
upon the exercise of an option or warrant or the conversion of a security
outstanding on the date hereof of which the Underwriters have been advised in
writing, or (C) the issuance by the Company of
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the Bonus Shares (as such term is defined in the Prospectus) to persons who have
executed lock-up agreements in the form of Exhibit A.
4. TERMS OF PUBLIC OFFERING. The Sellers are advised by you
that the Underwriters propose to make a public offering of their respective
portions of the Shares as soon after the Registration Statement and this
Agreement have become effective as in your judgment is advisable. The Sellers
are further advised by you that the Shares are to be offered to the public
initially at U.S. $____ a share (the "Public Offering Price") and to certain
dealers selected by you at a price that represents a concession not in excess of
U.S. $____ a share under the Public Offering Price, and that any Underwriter may
allow, and such dealers may reallow, a concession, not in excess of U.S. $____ a
share, to any Underwriter or to certain other dealers.
5. PAYMENT AND DELIVERY. Payment for the Firm Shares shall be
made to the Company in Federal or other funds immediately available in New York
City at the office of Xxxxxxx Xxxx & Xxxxxxxxx, One Citicorp Center, 000 Xxxx
00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, against delivery of such Firm Shares for
the respective accounts of the several Underwriters at 10:00 A.M., New York
City time, on _____ __, 1997,(6) or at such other time on the same or such
other date, not later than _____ ___, 1997,(7) as shall be designated in
writing by you. The time and date of such payment are hereinafter referred to
as the "Closing Date."
Payment for any Additional Shares shall be made in Federal or
other funds immediately available in New York City at the office of Xxxxxxx Xxxx
& Xxxxxxxxx, One Citicorp Center, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
at 10:00 A.M., New York City time, on the date specified in the notice described
in Section 3 or at such other time on the same or on such other
_____________________
(6) Insert date 3 business days or, in the event the offering is priced after
4:30 P.M. Eastern Time, 4 business days after date of Underwriting
Agreement.
(7) Insert date 5 business days after the date inserted in accordance with the
previous note.
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date, in any event not later than ___________, 1997(8), as shall be designated
in writing by the U.S. Representatives. The time and date of such payment are
hereinafter referred to as the "Option Closing Date."
Certificates for the Firm Shares and Additional Shares shall be
in definitive form and registered in such names and in such denominations as you
shall request in writing not later than two full business days prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.
6. CONDITIONS TO THE UNDERWRITERS' OBLIGATIONS. The
obligations of the Sellers to sell the Shares to the Underwriters and the
several obligations of the Underwriters to purchase and pay for the Shares on
the Closing Date are subject to the condition that the Registration Statement
shall have become effective not later than 5:00 p.m. (New York City time) on the
date hereof.
The several obligations of the Underwriters are
subject to the following further conditions:
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating accorded
any of the Company's securities which are rated as of the date of this
Agreement, if any, by any "nationally recognized statistical rating
____________________
(8) Insert date 10 business days after the expiration of the greenshoe option.
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organization," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act; and
(ii) there shall not have occurred any change, or any
development which would reasonably be expected to result in a change,
in the condition, financial or otherwise, or in the earnings, business
or operations of the Company and its subsidiaries, taken as a whole,
from that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement) that, in
your judgment, is material and adverse and that makes it, in your
judgment, impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus.
(b) The Underwriters shall have received:
(i) on the Closing Date a certificate, dated the Closing
Date and signed by an executive officer of the Company, to the effect
set forth in clause (a)(i) above and to the effect that the
representations and warranties of the Company contained in this
Agreement are true and correct as of the Closing Date and that the
Company has complied with all of the agreements and satisfied all of
the conditions on its part to be performed or satisfied by it
hereunder on or before the Closing Date; and
(ii) on each of the Closing Date and the Option Closing Date
a certificate, dated as of such date and signed by the general partner
of each of the Warburg Entities, to the effect that the
representations and warranties of such Warburg Entity contained in
this Agreement are true and correct as of such date and that such
Warburg Entity has complied with all of the agreements and satisfied
all of the conditions on its part to be performed or satisfied by it
hereunder on or before such date.
The officer signing and delivering such
certificate may rely upon his or her knowledge after inquiry of
relevant employees and counsel as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxxx, Xxxxxx, Xxxxx & Xxxx, outside counsel for the Company,
dated the Closing Date, in
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form and substance reasonably satisfactory to counsel for the Underwriters,
to the effect that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its
business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so
qualified or be in good standing would not reasonably be expected to
result in a material adverse change, in the condition, financial or
otherwise, or in the earnings, business or operations of the Company
and its subsidiaries, taken as a whole;
(ii) the authorized capital stock of the Company conforms as
to legal matters to the description thereof contained in the
Prospectus;
(iii) the shares of Common Stock (including the Shares
to be sold by the Warburg Entities) outstanding prior to the issuance
of the Shares to be sold by the Company have been duly authorized and
are validly issued, fully paid and non-assessable;
(iv) the Shares to be sold by the Company have been duly
authorized and, when issued and delivered in accordance with the terms
of this Agreement, will be validly issued, fully paid and
non-assessable, and the issuance of such Shares will not be subject to
any preemptive or similar rights;
(v) this Agreement has been duly authorized, executed and
delivered by the Company;
(vi) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene (A) any provision of applicable law or the
certificate of incorporation or by-laws of the Company, (B) any
agreement or other instrument either (x) filed as an exhibit to the
Registration Statement or (y) which is
16
known to such counsel and which is binding upon the Company or any of
its subsidiaries that is material to the Company and its subsidiaries,
taken as a whole, or (C) any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Company or any subsidiary which is either (x) described in the
Registration Statement, or (y) known to such counsel, and no consent,
approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, except such as may be
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares by the U.S.
Underwriters;
(vii) the statements (A) in the Prospectus under the
captions "Risk Factors -- Influence by Existing Stockholder," "Risk
Factors -- Anti-Takeover Effect of Certain Certificate of
Incorporation and By-Laws Provisions," "Risk Factors -- Shares
Eligible for Future Sale," "Management's Discussion and Analysis
of Financial Condition and Results of Operations -- Liquidity
and Capital Resources," "Management's Discussion and Analysis
of Financial Condition and Results of Operations -- Management
Bonus Plan," "Management -- Compensation Pursuant to
Plans -- Long-Term Incentive Plan Award" "Management -- Compensation
Pursuant to Plans -- Management Bonus Plan," "Management --
Compensation Pursuant to Plans -- 1997 Stock Incentive Plan,"
"Management -- Compensation Pursuant to Plans -- Pension Plan,"
"Certain Transactions," "Description of Capital Stock," "Shares
Eligible for Future Sale" and "Underwriters" and (B) in the
Registration Statement in Items 14 and 15, in each case insofar as
such statements constitute summaries of the legal matters, legal
documents or legal proceedings referred to therein, fairly present
the information called for by applicable law with respect to such
legal matters, legal documents and legal proceedings and fairly
summarize the matters referred to therein within the context of such
applicable law;
17
(viii) such counsel does not know of any legal or
governmental proceedings pending or threatened to which the Company
or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject that
are required to be described in the Registration Statement or the
Prospectus and are not so described or of any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to
the Registration Statement that are not described or filed as
required;
(ix) the Company is not and, after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as such term is defined in the Investment Company Act of
1940, as amended;
(x) such counsel is of the opinion that the Registration
Statement and Prospectus (except for financial statements and
supporting notes and schedules and other financial and statistical
data included therein as to which such counsel need not express any
opinion) comply as to form in all material respects with the
Securities Act and the applicable rules and regulations of the
Commission thereunder; and
(xi) The merger of Journal Register Company, LLC with and
into the Company, with the surviving entity being a Delaware
corporation, and the contribution of Integrated Newspaper Systems,
Inc. to the Company have been consummated as described in the
Prospectus.
In addition, such counsel shall state that nothing has come to
their attention that leads them to believe that the Registration Statement
at the time the Registration Statement became effective (other than the
financial statements and supporting notes and schedules and other financial
and statistical data contained therein, as to which such counsel need not
comment) contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary in order
to make the statements therein not misleading, or that
18
the Prospectus (other than the financial statements and supporting notes
and schedules and other financial and statistical data contained therein,
as to which such counsel need not comment) contains any untrue statement of
a material fact or omits to state a material fact necessary in order to
make the statements therein, in light of the circumstances under which they
were made, not misleading. In rendering such opinion, such counsel may
state that their opinion and belief is based upon their participation in
the preparation of the Registration Statement and Prospectus and review and
discussion of the contents thereof, but are without independent check or
verification.
In their opinion, counsel shall expressly authorize Xxxxxxx Xxxx
& Xxxxxxxxx to rely on said opinion.
With respect to paragraph (c) above, Xxxxxxxx, Xxxxxx, Xxxxx &
Xxxx may rely with respect to factual matters to the extent Xxxxxxxx,
Xxxxxx, Xxxxx & Xxxx deems appropriate, upon the representations and
certifications of the Company contained herein and in other documents and
instruments; provided that copies of any such other documents and
instruments shall be delivered to you and shall be in form and substance
satisfactory to your counsel.
(d) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxxx, Xxxx, Xxxxxxxxxxx & Xxxxxxxxx, outside counsel for
the Company, dated the Closing Date, in form and substance reasonably
satisfactory to counsel for the Underwriters, to the effect that:
(i) each Significant Subsidiary (as such term is defined in
Regulation S-X of the Securities Act) of the Company has been duly
incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not reasonably
be expected to result in a material adverse change, in the condition,
financial or
19
otherwise, or in the earnings, business or operations of the Company and
its subsidiaries, taken as a whole; and
(ii) all of the issued shares of capital stock of each
Significant Subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and are owned
directly by the Company or a wholly owned subsidiary of the Company,
free and clear of all liens, encumbrances, equities or claims.
In their opinion, counsel shall expressly authorize Xxxxxxx Xxxx
& Xxxxxxxxx to rely on said opinion.
With respect to paragraph (d) above, Xxxxxxxx, Xxxx,
Xxxxxxxxxxx & Xxxxxxxxx may rely with respect to factual matters to the
extent such counsel deems appropriate, upon the representations and
certifications of the Company contained herein and in other documents
and instruments; provided that copies of any such other documents and
instruments shall be delivered to
20
you and shall be in form and substance satisfactory to your counsel.
(e) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxx Xxxx & Xxxxxx LLP, special counsel to the Warburg
Entities, dated the Closing Date, in form and substance reasonably
satisfactory to counsel for the Underwriters, to the effect that:
(i) Each of the Warburg Entities has been duly organized,
and is validly existing as a limited partnership in good standing
under the laws of the jurisdiction of its formation, has the power and
authority to own its property and to conduct its business and is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on it or materially impair its ability
to consummate the transactions contemplated hereby;
(ii) this Agreement has been duly authorized, executed and
delivered by each of the Warburg Entities;
(iii) the execution and delivery by each of the Warburg
Entities of, and performance by each of the Warburg Entities of its
obligations under, this Agreement will not contravene any provision of
applicable law or the certificate of limited partnership or agreement
of limited partnership of such Warburg Entity or, to the best of
such counsel's knowledge, any agreement or other instrument binding
upon such Warburg Entity or, to the best of such counsel's knowledge,
any judgment, order or decree of any governmental body, agency or court
having jurisdiction over such Warburg Entity, and no consent, approval,
authorization or order of, or qualification with, any governmental body
or agency is required for the performance by each of the Warburg
Entities of its obligations under this Agreement, except such as may be
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Additional Shares;
21
(iv) Based solely on a review of the Company's transfer
ledger, which was certified by the Company as being true, correct
and complete, and a review of the relevant stock certificates, each of
the Warburg Entities has valid title to the Shares to be sold by such
Warburg Entity; each of the Warburg Entities and has the legal right
and power, and all authorization and approval required by law, to
enter into this Agreement and to sell, transfer and deliver the Shares
to be sold by such Warburg Entity pursuant to this Agreement; and
(v) delivery of the shares to be sold by each of the
Warburg Entities pursuant to this Agreement will pass title to such
Shares free and clear of any security interests, claims, liens,
equities and other encumbrances, assuming that each U.S. Underwriter
purchases the shares in good faith without notice of any adverse
claim.
In their opinion, counsel shall expressly authorize Xxxxxxx Xxxx
& Xxxxxxxxx to rely on said opinion.
With respect to paragraph (e) above, Xxxxxx Xxxx & Xxxxxx LLP may
rely with respect to factual matters and to the extent such counsel deems
appropriate, upon the
22
representations and certifications of the Warburg Entities contained herein
and in other documents and instruments; provided that copies of any such
other documents and instruments shall be delivered to you and shall be in
form and substance satisfactory to your counsel.
(f) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxx Xxxx & Xxxxxxxxx, counsel for the Underwriters, dated
the Closing Date, covering the matters referred to in subparagraphs (iv),
(v), (vii) (but only as to the statements in the Prospectus under
"Description of Capital Stock" and "Underwriters") and (x) of paragraph (c)
above.
In addition, such counsel shall state that nothing has come to
their attention that leads them to believe that the Registration Statement
at the time the Registration Statement became effective (other than the
financial statements and supporting notes and schedules and other financial
and statistical data contained therein, as to which such counsel need not
comment) contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary in order
to make the statements therein not misleading, or that the Prospectus
(other than the financial statements and supporting notes and schedules and
other financial and statistical data contained therein, as to which such
counsel need not comment) contains any untrue statement of a material fact
or omits to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. In rendering such opinion, such counsel may state that their
opinion and belief is based upon their participation in the preparation of
the Registration Statement and Prospectus and review and discussion of the
contents thereof, but are without independent check or verification.
The opinion of Xxxxxxxx, Xxxxxx, Xxxxx & Xxxx described in
paragraph (c) above, the opinion of Xxxxxxxx, Xxxx, Xxxxxxxxxxx &
Xxxxxxxxx (d) above and the opinion of Xxxxxx Xxxx & Xxxxxx LLP in
paragraph (e) above shall be (and each shall state that it is)
rendered to the Underwriters at the request of the Company.
(g) The Underwriters shall have received, on each of the date
hereof and the Closing Date, a letter dated the
23
date hereof or the Closing Date, as the case may be, in form and substance
satisfactory to the Underwriters, from Ernst & Young LLP, independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in the
Registration Statement and the Prospectus; provided that the letter delivered on
the Closing Date shall use a "cut-off date" not earlier than the date hereof.
(h) The "lock-up" agreements, each substantially in the form of
Exhibit A hereto, between you and all of the executive officers and
directors of the Company, all of the people listed on Exhibit B, who are
the only people who will receive Bonus Shares (as such term is defined in
the Prospectus), and each of the Warburg Entities relating to sales and
certain other dispositions of shares of Common Stock or certain other
securities, shall have been delivered to you on or before the date hereof,
and shall be in full force and effect on the Closing Date.
(i) The several obligations of the U.S. Underwriters to purchase
Additional Shares hereunder are subject to the delivery to the U.S.
Representatives on the Option Closing Date of such documents as they may
reasonably request with respect to the good standing of the Company, the
due authorization and issuance of the Additional Shares and other documents
customarily required by the Underwriters related to the issuance of the
Additional Shares as are customarily requested in connection with such an
option.
7. COVENANTS OF THE COMPANY. In further consideration of the
agreements of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
(a) To furnish to you, without charge, eleven signed copies of
the Registration Statement (including exhibits thereto) and for delivery to
each other Underwriter a conformed copy of the Registration Statement
(without exhibits thereto) and to furnish to you in New York City, without
charge, prior to 10:00 A.M. New York City time on the business day next
succeeding the date of this Agreement and during the period mentioned in
paragraph (c) below, as
24
many copies of the Prospectus and any supplements and amendments thereto or
to the Registration Statement as you may reasonably request.
(b) Before amending or supplementing the Registration Statement
or the Prospectus, to furnish to you a copy of each such proposed amendment
or supplement and not to file any such proposed amendment or supplement to
which you reasonably object, and to file with the Commission within the
applicable period specified in Rule 424(b) under the Securities Act any
prospectus required to be filed pursuant to such Rule.
(c) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the Underwriters
the Prospectus is required by law to be delivered in connection with sales
by an Underwriter or dealer, any event shall occur or condition exist as a
result of which it is necessary to amend or supplement the Prospectus in
order to make the statements therein, in the light of the circumstances
when the Prospectus is delivered to a purchaser, not misleading, or if, in
the opinion of counsel for the Underwriters, it is necessary to amend or
supplement the Prospectus to comply with applicable law, forthwith to
prepare, file with the Commission and furnish, at its own expense, to the
Underwriters and to the dealers (whose names and addresses you will furnish
to the Company) to which Shares may have been sold by you on behalf of the
Underwriters and to any other dealers upon request, either amendments or
supplements to the Prospectus so that the statements in the Prospectus as
so amended or supplemented will not, in the light of the circumstances when
the Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus, as amended or supplemented, will comply with law.
(d) To endeavor, in cooperation with you, to qualify the Shares
for offer and sale under the securities or Blue Sky laws of such
jurisdictions as you shall reasonably request; provided that the Company
shall not be required to qualify as a foreign corporation or file a general
consent to service of process in any such jurisdiction.
(e) To make generally available to the Company's security
holders and to you as soon as practicable an
25
earning statement covering the twelve-month period ending June 30, 1998
that satisfies the provisions of Section 11(a) of the Securities Act and
the rules and regulations of the Commission thereunder.
(f) To issue Bonus Shares only to persons who have delivered a
lock-up agreement to you in the form of Exhibit A.
8. EXPENSES. Whether or not the transactions contemplated in
this Agreement are consummated or this Agreement is terminated, the Company
agrees to pay or cause to be paid all expenses incident to the performance of
its obligations under this Agreement, including: (i) the fees, disbursements
and expenses of the Company's counsel and the Company's accountants in
connection with the registration and delivery of the Shares under the Securities
Act and all other fees or expenses in connection with the preparation and filing
of the Registration Statement, any preliminary prospectus, the Prospectus and
amendments and supplements to any of the foregoing, including all printing costs
associated therewith, and the mailing and delivering of copies thereof to the
Underwriters and dealers, in the quantities hereinabove specified, (ii) all
costs and expenses related to the transfer and delivery of the Shares to the
Underwriters, including any transfer or other taxes payable thereon, (iii) the
cost of printing or producing any Blue Sky or Legal Investment memorandum in
connection with the offer and sale of the Shares under state securities laws and
all expenses in connection with the qualification of the Shares for offer and
sale under state securities laws or Blue Sky laws as provided in Section 7(d)
hereof, including filing fees and the reasonable fees and disbursements of
counsel for the Underwriters in connection with such qualification and in
connection with the Blue Sky or Legal Investment memorandum, (iv) all filing
fees and disbursements of counsel to the Underwriters incurred in connection
with the review and qualification of the offering of the Shares by the National
Association of Securities Dealers, Inc., (v) all fees and expenses in connection
with the preparation and filing of the registration statement on Form 8-A
relating to the Common Stock and all costs and expenses incident to listing the
Shares on the New York Stock Exchange and other national securities exchanges
and foreign stock exchanges, (vi) the cost of printing certificates representing
the Shares, (vii) the costs and charges of any transfer agent, registrar or
depositary, (viii) the costs and expenses of the Company relating
26
to investor presentations on any "road show" undertaken in connection with the
marketing of the offering of the Shares, including, without limitation, expenses
associated with the production of road show slides and graphics, fees and
expenses of any consultants engaged in connection with the road show
presentations with the prior approval of the Company, travel and lodging
expenses of the representatives and officers of the Company and any such
consultants, and the costs of any aircraft chartered in connection with the road
show, and (ix) all other costs and expenses incident to the performance of the
obligations of the Company hereunder for which provision is not otherwise made
in this Section. It is understood, however, that except as specifically
provided in this Section, Section 9 entitled "Indemnity and Contribution," and
the last paragraph of Section 11 below, the Underwriters will pay all of their
costs and expenses, including fees and disbursements of their counsel, stock
transfer taxes payable on resale of any of the Shares by them, any advertising
expenses connected with any offers they may make and expenses associated with
the preparation of prospectus memorabilia.
The Warburg Entities agree to pay or cause to be paid (i) all
taxes, if any, on the transfer and sale, if any, of the Additional Shares and
(ii) all costs and expenses incident to the performance of the obligations of
the Warburg Entities under this Agreement, including, but, not limited to, all
expenses incident to the delivery of the Shares to be sold by the Warburg
Entities and the fees and expenses of counsel for the Warburg Entities.
The provisions of this Section shall not supersede or otherwise
affect any agreement that the Sellers may otherwise have for the allocation of
such expenses among themselves.
9. INDEMNITY AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), from and
against any and all losses, claims, damages and liabilities (including,
without limitation, any legal or other expenses reasonably incurred by or
on behalf of each such person in connection with defending or investigating
any such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration
27
Statement or any amendment thereof, any preliminary prospectus or the
Prospectus (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto), or caused by any omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading (in the
case of any preliminary prospectus or the Prospectus, in light of the
circumstances under which it was made), except insofar as such losses,
claims, damages or liabilities are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein; provided, however, that
the foregoing indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages or liabilities purchased
Shares, or any person controlling such Underwriter, if a copy of the
Prospectus (as then amended or supplemented if the Company shall have
furnished any amendment or supplement thereto) was not sent or given by or
on behalf of such Underwriter to such person, if required by law to have
been so delivered, at or prior to the written confirmation of the sale of
the Shares sold by the Company to such person, and if the Prospectus (as so
amended or supplemented) would have cured the defect giving rise to such
losses, claims, damages or liabilities.
(b) The Warburg Entities agree to indemnify and hold harmless
each Underwriter, each person, if any, who controls any Underwriter within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, or is under common control with, or is controlled by, any
Underwriter, and the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company
within the meaning of either Section 15 of the Securities Act or Section 20
of the Exchange Act from and against any and all losses, claims, damages
and liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement
of a material fact with respect to the Warburg Entities contained in the
Registration Statement or any amendment thereof, any preliminary prospectus
or the Prospectus (as
28
amended or supplemented if the Company shall have furnished any amendments
or supplements thereto), or caused by any omission or alleged omission to
state therein a material fact with respect to the Warburg Entities required
to be stated therein or necessary to make the statements therein not
misleading (in the case of any preliminary prospectus or the Prospectus, in
light of the circumstances under which it was made), except insofar as such
losses, claims, damages or liabilities are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon
information relating to any Underwriter furnished to the Company in writing
by such Underwriter through you expressly for use therein; provided,
however, that the foregoing indemnity agreement with respect to any
preliminary prospectus shall not inure to the benefit of any Underwriter
from whom the person asserting any such losses, claims, damages or
liabilities purchased Shares, or any person controlling such Underwriter,
if a copy of the Prospectus (as then amended or supplemented if the Company
shall have furnished any amendment or supplement thereto) was not sent or
given by or on behalf of such Underwriter to such person, if required by
law to have been so delivered, at or prior to the written confirmation of
the sale of the Shares sold by the Company to such person, and if the
Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities. The liability
of the Warburg Entities under the indemnity agreement contained in this
paragraph or for breach of their representations and warranties contained
in Section 2 hereof shall be limited to an amount equal to the net
proceeds, if any, received by the Warburg Entities from the offering of the
Shares sold by the Warburg Entities. In addition, the Warburg Entities
shall not be liable under the indemnity agreement contained in this
paragraph unless and until you, as Managers of the offering, have made
written demand on the Company for payment under this paragraph and the
amount specified in such demand is not paid in full by the Company within
60 days after receipt of the demand by the Company.
(c) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers who
sign the Registration Statement, the Warburg Entities and each person, if
any, who controls the Company or the Warburg Entities within the meaning of
either Section 15 of the Securities Act or Section 20 of the
29
Exchange Act to the same extent as the foregoing indemnity from the Company
to such Underwriter, but only with reference to information relating to
such Underwriter furnished to the Company in writing by such Underwriter
through you expressly for use in the Registration Statement, any
preliminary prospectus, the Prospectus or any amendments or supplements
thereto.
(d) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to paragraph (a), (b) or (c) of this
Section 9, such person (the "indemnified party") shall promptly notify the
person against whom such indemnity may be sought (the "indemnifying party")
in writing and the indemnifying party, upon request of the indemnified
party, shall retain counsel reasonably satisfactory to the indemnified
party to represent the indemnified party and any others the indemnifying
party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified
party and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them.
It is understood that the indemnifying party shall not, in respect of the
legal expenses of any indemnified party in connection with any proceeding
or related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel)
for all such indemnified parties and that all such fees and expenses shall
be reimbursed as they are incurred. Such firm shall be designated in
writing by Xxxxxx Xxxxxxx & Co. Incorporated, in the case of parties
indemnified pursuant to paragraph (a) or (b) of this Section 9, and by the
Company, in the case of parties indemnified pursuant to paragraph (c) of
this Section 9. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent or if
30
there be a final judgment for the plaintiff, the indemnifying party agrees
to indemnify the indemnified party from and against any loss or liability
by reason of such settlement or judgment. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by the second and third sentences of this
paragraph, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i)
such settlement is entered into more than 60 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with
such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which
any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
(e) To the extent the indemnification provided for in paragraph
(a), (b) or (c) of this Section 9 is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then each indemnifying party under such paragraph, in
lieu of indemnifying such indemnified party thereunder, shall contribute to
the amount paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the indemnifying
party or parties on the one hand and the indemnified party or parties on
the other hand from the offering of the Shares or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the
indemnifying party or parties on the one hand and of the indemnified party
or parties on the other hand in connection with the statements or omissions
that resulted in such losses, claims, damages or liabilities, as well as
any
31
other relevant equitable considerations. The relative benefits received by
the Sellers on the one hand and the Underwriters on the other hand in
connection with the offering of the Shares shall be deemed to be in the
same respective proportions as the net proceeds from the offering of the
Shares (before deducting expenses) received by each Seller and the total
underwriting discounts and commissions received by the Underwriters, in
each case as set forth in the table on the cover of the Prospectus, bear to
the aggregate Public Offering Price of the Shares. The relative fault of
the Sellers on the one hand and the Underwriters on the other hand shall
be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Sellers or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission. The Underwriters' respective obligations to contribute
pursuant to this Section 9 are several in proportion to the respective
number of Shares they have purchased hereunder, and not joint.
(f) The Sellers and the Underwriters agree that it would not be
just or equitable if contribution pursuant to this Section 9 were
determined by PRO RATA allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation that does
not take account of the equitable considerations referred to in paragraph
(e) of this Section 9. The amount paid or payable by an indemnified party
as a result of the losses, claims, damages and liabilities referred to in
the immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
Section 9, (i) no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission and (ii) the Warburg Entities shall not be
required to contribute an amount in excess of
32
the amount by which the net proceeds of the offering received by Warburg
Entities exceeds the amount of any damages that Warburg Entities have
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The remedies provided for in this
Section 9 are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in
equity.
(g) The indemnity and contribution provisions contained in this
Section 9 and the representations, warranties and other statements of the
Company and the Warburg Entities contained in this Agreement shall remain
operative and in full force and effect regardless of (i) any termination of
this Agreement, (ii) any investigation made by or on behalf of any
Underwriter or any person controlling any Underwriter, the Warburg Entities
or any person controlling the Warburg Entities or by or on behalf of the
Company, its officers or directors or any person controlling the Company
and (iii) acceptance of and payment for any of the Shares.
10. TERMINATION. This Agreement shall be subject to termination
by notice given by you to the Company, if (a) after the execution and delivery
of this Agreement and prior to the Closing Date: (i) trading generally shall
have been suspended or materially limited on or by, as the case may be, any of
the New York Stock Exchange, the American Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of
any securities of the Company shall have been suspended on any exchange or in
any over-the-counter market, (iii) a general moratorium on commercial banking
activities in the State of New York shall have been declared by either Federal
or New York State authorities or (iv) there shall have occurred any outbreak or
escalation of hostilities or any change in financial markets or any calamity or
crisis that, in your judgment, is material and adverse and (b) in the case of
any of the events specified in clauses (a)(i) through (iv), such event, singly
or together with any other such event, makes it, in
33
your judgment, impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus.
11. EFFECTIVENESS; DEFAULTING UNDERWRITERS. This Agreement
shall become effective upon the execution and delivery hereof by the parties
hereto.
If, on the Closing Date or the Option Closing Date, as the case
may be, any one or more of the Underwriters shall fail or refuse to purchase
Shares that it has or they have agreed to purchase hereunder on such date, and
the aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate number of the Shares to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Firm Shares set forth opposite their respective names in Schedule I or Schedule
II bears to the aggregate number of Firm Shares set forth opposite the names of
all such non-defaulting Underwriters, or in such other proportions as you may
specify, to purchase the Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; provided
that in no event shall the number of Shares that any Underwriter has agreed to
purchase pursuant to this Agreement be increased pursuant to this Section 11 by
an amount in excess of one-ninth of such number of Shares without the written
consent of such Underwriter. If, on the Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Firm Shares and the aggregate
number of Firm Shares with respect to which such default occurs is more than
one-tenth of the aggregate number of Firm Shares to be purchased, and
arrangements satisfactory to you and the Company for the purchase of such Firm
Shares are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter or the
Company. In any such case either you or the Company shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and in the
Prospectus or in any other documents or arrangements may be effected. If, on
the Option Closing Date, any U.S. Underwriter or U.S. Underwriters shall fail or
refuse to purchase Additional Shares and the aggregate number of Additional
Shares with respect to which such default occurs is more than one-tenth of the
aggregate number of Additional Shares to be purchased, the non-defaulting U.S.
Underwriters shall have the option to (i) terminate their
34
obligation hereunder to purchase Additional Shares or (ii) purchase not less
than the number of Additional Shares that such non-defaulting U.S. Underwriters
would have been obligated to purchase in the absence of such default. Any
action taken under this paragraph shall not relieve any defaulting Underwriter
from liability in respect of any default of such Underwriter under this
Agreement.
If this Agreement shall be terminated by the Underwriters, or any
of them, because of any failure or refusal on the part of any Seller to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason any Seller shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
12. COUNTERPARTS. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
13. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
[Signature Page Follows]
35
14. HEADINGS. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
Very truly yours,
JOURNAL REGISTER COMPANY
By: ______________________
Name: Xxxxxx X. Xxxxxxx
Title: President and Chief
Executive Officer
WARBURG, XXXXXX CAPITAL COMPANY, L.P.
By: Warburg, Xxxxxx & Co.
Its: General Partner
By: ___________________
Name:
Title: Partner
WARBURG, XXXXXX CAPITAL PARTNERS, L.P.
By: Warburg, Xxxxxx & Co.
Its: General Partner
By: ___________________
Name:
Title: Partner
XXXXXXX, XXXXXX INVESTORS, L.P.
By: Warburg, Xxxxxx & Co.
Its: General Partner
By: ___________________
Name:
Title: Partner
Accepted as of the date hereof
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
BEAR, XXXXXXX & CO. INC.
CHASE SECURITIES INC.
Acting severally on behalf
of themselves and the
36
several Underwriters named
in Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co.
Incorporated
By: ___________________
Name:
Title:
XXXXXX XXXXXXX & CO. INTERNATIONAL LIMITED
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES
CORPORATION
XXXXXXX XXXXX INTERNATIONAL
BEAR, XXXXXXX INTERNATIONAL LIMITED
CHASE MANHATTAN INTERNATIONAL LIMITED
Acting severally on behalf of themselves
and the several International Underwriters
named in Schedule II hereto.
By Xxxxxx Xxxxxxx & Co. International Limited
By: ____________________
Name:
Title:
37
SCHEDULE I
Number of
Firm Shares
Underwriter To Be Purchased
----------- ---------------
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
Xxxxxxx Lynch, Pierce, Xxxxxx
& Xxxxx Incorporated
Bear, Xxxxxxx & Co. Inc.
Chase Securities Inc.
____________
Total U.S. Firm Shares...........
============
Schedule II
INTERNATIONAL UNDERWRITERS
Number of
Firm Shares
Underwriter To Be Purchased
----------- ---------------
Xxxxxx Xxxxxxx & Co. International Limited
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation
Xxxxxxx Xxxxx International
Bear, Xxxxxxx International Limited
Chase Manhattan International Limited
_____________
Total International Firm Shares
=============
EXHIBIT A
[FORM OF LOCK-UP LETTER]
____________, 1997
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
Xxxxxxx Lynch, Pierce, Xxxxxx
& Xxxxx Incorporated
Bear, Xxxxxxx & Co. Inc.
Chase Securities Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. International Limited
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxxxx Xxxxx International
Bear, Xxxxxxx International Limited
Chase Manhattan International Limited
c/o Morgan Xxxxxxx & Co. International Limited
00 Xxxxx Xxxxxx
Xxxxxx Xxxxx
Xxxxxx X00 0XX
Xxxxxxx
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated
("Xxxxxx Xxxxxxx") and Xxxxxx Xxxxxxx & Co. International Limited ("MSIL")
propose to enter into an Underwriting Agreement (the "Underwriting Agreement")
with Journal Register Company, a Delaware corporation (the "Company"), Warburg,
Xxxxxx Capital Company, L.P., Warburg, Xxxxxx Capital Partners, L.P., and
Warburg, Xxxxxx Investors, L.P., providing for the public offering (the "Public
Offering") by the several Underwriters, including Xxxxxx Xxxxxxx and MSIL (the
"Underwriters") of up to ___ shares (the "Shares") of the common stock, par
value $.01 per share of the Company (the "Common Stock").
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 180 days after the date of the final prospectus relating
to the Public Offering (the "Prospectus"), (1) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, or otherwise transfer
or dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock, or
(2) enter into any swap or other agreement that transfers to another, in whole
or in part, any of the economic consequences of ownership of the Common Stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or such other securities, in cash or
otherwise. The foregoing sentence shall not apply to the sale of any Shares to
the Underwriters pursuant to the Underwriting Agreement. In addition, the
undersigned agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 180 days after the date of the Prospectus, make any
demand for or exercise any right with respect to, the registration of any shares
of Common Stock or any security convertible into or exercisable or exchangeable
for Common Stock.
Whether or not the Public Offering actually occurs depends on a
number of factors, including market conditions. The Public Offering or purchase
of Shares with respect thereto will only be made pursuant to an Underwriting
Agreement, the terms of which are subject to negotiations between the Company
and the Underwriters.
Very truly yours,
-----------------------------------
(Name)
-----------------------------------
(Address)
2
EXHIBIT B
RECIPIENTS OF BONUS SHARES
3