6,650,000 Shares
JACOR COMMUNICATIONS, INC.
Common Stock
($.01 Par Value Per Share)
UNDERWRITING AGREEMENT
May 15, 1997
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
CREDIT SUISSE FIRST BOSTON
CORPORATION
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
XXXXXX XXXXXXX & CO.
INCORPORATED
XXXXX XXXXXX INC.
c/x Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Jacor Communications, Inc., a Delaware corporation (the "Company")and
Jacor Communications Company; Broadcast Finance, Inc.; Cine Films, Inc.; Cine
Guarantors, Inc.; Cine Guarantors II, Inc.; Cine Guarantors II, Ltd.; Cine
Mobile Systems Int'l. N.V.; Cine Movil S.A. de C.V.; Citicasters Co.; EFM
Programming, Inc.; F.M.I. Pennsylvania, Inc.; GACC-N26LB, Inc.; GACC-340, Inc.;
Georgia Network Equipment, Inc.; Great American Merchandising Group, Inc.; Great
American Television Productions, Inc.; Inmobilaria Radial, S.A. de C.V.; Jacor
Broadcasting Corporation; Jacor Broadcasting of Atlanta, Inc.; Jacor
Broadcasting of Colorado, Inc.; Jacor Broadcasting of Florida, Inc.; Jacor
Broadcasting of Knoxville, Inc.; Jacor Broadcasting of St. Louis, Inc.; Jacor
Broadcasting of San Diego, Inc.; Jacor Broadcasting of Sarasota, Inc.; Jacor
Broadcasting of Tampa Bay, Inc.;
Jacor Cable, Inc.; Location Productions, Inc.; Location Productions II, Inc.;
Noble Broadcast Center, Inc.; Noble Broadcast Group, Inc.; Noble Broadcast
Holdings, Inc.; Noble Broadcast Licenses, Inc.; Noble Broadcast of Colorado,
Inc.; Noble Broadcast of St. Louis, Inc.; Noble Broadcast of San Diego, Inc.;
Noble Broadcast of Toledo, Inc.; Nobro, S.C.; Nova Marketing Group, Inc.;
Regent Broadcasting of Charleston, Inc.; Regent Broadcasting of Kansas City,
Inc.; Regent Broadcasting of Las Vegas, Inc.; Regent Broadcasting of Las
Vegas II, Inc.; Regent Broadcasting of Louisville, inc., Regent Broadcasting
of Louisville II, Inc.; Regent Broadcasting of Salt Lake City, Inc.; Regent
Broadcasting of Salt Lake City II, Inc.; Regent Licensee of Charleston, Inc.;
Regent Licensee of Kansas City, Inc.; Regent Licensee of Las Vegas, Inc.;
Regent Licensee of Las Vegas II, Inc; Regent Licensee of Louisville, Inc.;
Regent Licensee of Louisville II, Inc.; Regent Licensee of Salt Lake City,
Inc.; Regent Licensee of Salt Lake City II, Inc.; Sports Radio Broadcasting,
Inc.; Sports Radio, Inc.; Xxxx-TCI Satellite Services, Inc.; The Xx Xxxxxxx
Company Agency, Inc.; WHOK, Inc.; and VTTV Productions, each a direct or
indirect subsidiary of the Company or any successor entity, whether by
merger, consolidation, change of name or otherwise (collectively, the
"Subsidiaries" and together with the Company, the "Registrants") confirm
their agreement with the several Underwriters listed in Schedule I hereto
(the "Underwriters") for whom Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation ("DLJ"), Credit Suisse First Boston Corporation, Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated, Xxxxxx Xxxxxxx & Co. Incorporated and
Xxxxx Xxxxxx Inc. (collectively, the Representatives) have been duly
authorized to act as representatives as follows:
1. THE SHARES. Subject to the terms and conditions herein set forth,
the Company proposes to sell to the Underwriters an aggregate of 6,650,000
shares (the "Firm Shares") of common stock, $.01 par value per share, of the
Company (the "Common Stock"). The Company also proposes to sell to the several
Underwriters an aggregate of not more than 997,500 additional shares of Common
Stock (the "Additional Shares"), if requested by the Underwriters as provided in
Section 3 hereof. The Firm Shares and the Additional Shares are herein
collectively called the "Shares".
2
The Shares are being issued and sold (i) to fund, in part, the Cash
Consideration (as that term is defined in the Prospectus (defined below)) to
be paid by the Company under the Premiere Merger Agreement (as defined
herein) and, to the extent available, the other Pending Transactions (as that
term is defined in the Prospectus). Alternatively and pending such uses, the
Company intends to use the net proceeds for general corporate purposes,
including acquisitions of other broadcast properties and broadcast related
businesses and to repay in part outstanding indebtedness under the Credit
Facility (defined below).
The Pending Transactions include, among other things, the merger
(the "Premiere Merger") of PRN Holding Acquisition Corp. ("PRN Holding"), a
subsidiary of the Company with and into Premiere Radio Networks, Inc.
("Premiere") pursuant to an Agreement and Plan of Merger (the "Premiere
Merger Agreement"), dated as of April 7, 1997 by and among the Company, Jacor
Communications Company and PRN Holding.
This Underwriting Agreement and all related agreements and
documents executed in connection with the Pending Transactions are
collectively referred to herein as the "Transaction Documents."
Concurrently with the sale of the Shares, the Company is offering a
minimum of $20.0 million of Common Stock to Equity Group Investments, Inc.
("EGI"), an affiliate of the Company's largest stockholder, Xxxx/Chilmark
Fund (the "Xxxx Offering") L.P., or to an affiliated EGI.
2. REGISTRATION STATEMENT AND PROSPECTUS. The Registrants have
prepared and filed with the Securities and Exchange Commission (the
"Commission") in accordance with the provisions of the Securities Act of
1933, as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Act"), a "shelf" registration statement on Form S-3 (No.
333-19291), including a prospectus, relating to debt securities, preferred
stock, depository Shares and common stock, and will promptly file with the
Commission a prospectus supplement specifically relating to the Shares
pursuant to Rule 424 under
3
the Act. The registration statement, as amended at the time it became
effective or, if a post-effective amendment is filed with respect thereto, as
amended by such post-effective amendment at the time of its effectiveness,
including in each case, all documents incorporated or deemed incorporated by
reference therein, if any, all financial statements and exhibits, and the
information, if any, contained in a prospectus or term sheet subsequently
filed with the Commission pursuant to Rule 424(b) under the Act and deemed to
be a part of the registration statement at the time of its effectiveness
pursuant to Rule 430A or Rule 434 under the Act (as applicable), and any
additional registration statement relating to the issuance of additional
shares of Common Stock filed pursuant to Rule 462(b) under the Act, is
hereinafter referred to as the "Registration Statement"; and the prospectus,
constituting a part of the Registration Statement at the time it became
effective, or such revised prospectus as shall be provided to the
Underwriters for use in connection with the offering of the Shares that
differs from the prospectus on file with the Commission at the time the
Registration Statement became effective including any prospectus supplement,
and including, in each case, all documents incorporated or deemed
incorporated by reference therein, if any, whether or not filed with the
Commission pursuant to Rule 424(b) under the Act, and including any
preliminary prospectus supplement subject to completion and any term sheet
meeting the requirements of Rule 434(c), filed pursuant to Rule 424(b), in
the form used to confirm sales of the Shares, are hereinafter referred to
collectively as the "Prospectus."
3. AGREEMENTS TO SELL AND PURCHASE. On the basis of the
representations and warranties contained in this Agreement, and subject to
its terms and conditions, the Company agrees to issue and sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly,
to purchase from the Company, at a price per share of $29.69 (the
"Purchase Price") the aggregate number of Firm Shares set forth opposite the
name of such Underwriter in Schedule I hereto.
On the basis of the representations and warranties contained in
this Agreement, and subject to the terms and conditions hereof, (i) the
Company agrees to
4
issue and sell to the Underwriters up to 697,500 Additional Shares, (ii) the
Underwriters shall have a right to purchase, severally and not jointly, from
time to time, up to an aggregate of 697,500 Additional Shares at the Purchase
Price. Additional Shares may be purchased as provided in Section 4 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 Underwriter, severally and not jointly, agrees to purchase
the number of Additional Shares (subject to such adjustments to eliminate
fractional shares as DLJ may determine) which bears the same proportion to
the total number of Additional Shares to be purchased as the number of Firm
Shares set forth opposite the name of such Underwriter in Schedule I hereto
bears to the total number of Firm Shares.
The Company hereby agrees, and the Company shall, concurrently with
the execution of this Agreement, deliver an agreement executed by (i) each of
the directors and officers of the Company, (ii) Xxxx/Chilmark Fund, L.P. and
(iii) the Citicasters Holders (as that term is defined in the Prospectus),
pursuant to which each such person will agree, not to, offer to sell, sell,
distribute, grant any option to purchase or otherwise dispose of, directly
or indirectly, any shares of Common Stock, or any securities convertible into
or exercisable or exchangeable for, shares of Common Stock owned by them, for
a period of 120 days after the date of the prospectus supplement, dated
May 15, 1997 (the "Prospectus Supplement"), except (A) with the prior written
consent of DLJ (B) pursuant to this Agreement, (C) pursuant to stock options or
stock option plans referred to in the Prospectus or (D) in connection with the
Pending Transactions as set forth in the Prospectus or in connection with other
acquisition transactions in which the recipients of such Shares are restricted
from selling such Shares until after the expiration of 120 days from the date
of the Prospectus
Supplement.
4. DELIVERY AND PAYMENT. Delivery to you of and payment for the
Firm Shares shall be made at 9:00 A.M., New York City time, on the fourth
business day, unless otherwise permitted by the Commission pursuant to Rule
15c6-1 under the Securities Exchange Act of 1934, as amended, and the rules
and regulations of the Commission
5
thereunder (collectively, the "Exchange Act"), (such time and date being
referred to as the "Closing Date") following the date of the initial public
offering of the Firm Shares as advised by DLJ to the Company, at such place
as DLJ shall reasonably designate. The Closing Date and the location of
delivery of the Firm Shares may be varied by agreement between DLJ and the
Company.
Delivery to the Underwriters of and payment for any Additional
Shares to be purchased by the Underwriters shall be made at such place as DLJ
shall designate, at 9:00 A.M., New York City time, on such date or dates
(individually, an "Option Closing Date"), which may be the same as the
Closing Date but shall in no event be earlier than the Closing Date, as shall
be specified in a written notice from DLJ to the Company of the Underwriters'
determination to purchase a number, specified in said notice, of Additional
Shares. Any such notice may be given at any time not later than 30 days
after the date of this Agreement. Any Option Closing Date and the location
of delivery of and payment for the Additional Shares may be varied by
agreement among DLJ and the Company.
Certificates for the Shares shall be registered in such names and
issued in such denominations as DLJ shall request in writing not later than
two full business days prior to the Closing Date, or the applicable Option
Closing Date, as the case may be, and shall be made available to you at the
offices of DLJ (or such other place as shall be acceptable to you) for
inspection not later than 9:30 A.M., New York City time, on the business day
next preceding the Closing Date or the applicable Option Closing Date, as the
case may be. Certificates in definitive form evidencing the Shares shall be
delivered to you on the Closing Date, or the applicable Option Closing Date,
as the case may be, with any transfer taxes payable upon initial issuance
thereof duly paid by the Company, for the respective accounts of the
Underwriters against payment of the Purchase Price by wire transfer payable
in same day funds, to the order of the Company.
5. AGREEMENTS OF THE REGISTRANTS. The Registrants agree with each of
you that:
(a) The Registrants will, if the Registration
6
Statement has not heretofore become effective under the Act, file an
amendment to the Registration Statement or, if necessary pursuant to
Rule 430A under the Act, a post-effective amendment to the Registration
Statement, in each case as soon as practicable after the execution and
delivery of this Agreement, and will use their best efforts to cause
their Registration Statement or such post-effective amendment to become
effective at the earliest possible time. The Registrants will comply
fully and in a timely manner with the applicable provisions of Rule 424
and Rule 430A and, if applicable, Rule 462, under the Act.
(b) The Registrants will advise you promptly and, if
requested by any of you, confirm such advice in writing, (i) when the
Registration Statement has become effective, if and when the Prospectus
is sent for filing pursuant to Rule 424 under the Act and when any
post-effective amendment to the Registration Statement becomes
effective, (ii) of the receipt of any comments from the Commission or
any state securities commission or regulatory authority that relate to
the Registration Statement or requests by the Commission or any state
securities commission or regulatory authority for amendments to the
Registration Statement or amendments or supplements to the Prospectus or
for additional information, (iii) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration
Statement, or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction, or the initiation of any
proceeding for such purpose by the Commission or any state securities
commission or any other regulatory authority, and (iv) of the happening
of any event during such period as in your reasonable judgment you are
required to deliver a prospectus in connection with sales of the Shares
by you which makes any statement of a material fact made in the
Registration Statement untrue or which requires the making of any
additions to or changes in the Registration Statement (as amended or
supplemisleading or that makes any statement of a material fact made in
the Prospectus (as amended or supple-
7
mented from time to time) untrue or which requires the making of any
additions to or changes in the Prospectus (as amended or supplemented
from time to time) in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. The
Company shall use its best efforts to prevent the issuance of any stop
order or order suspending the qualification or exemption of the Shares
under any state securities or Blue Sky laws, and, if at any time the
Commission shall issue any stop order suspending the effectiveness of
the Registration Statement, or any state securities commission or other
regulatory authority shall issue an order suspending the qualification
or exemption of the Shares under any state securities or Blue Sky laws,
the Company shall use every reasonable effort to obtain the withdrawal
or lifting of such order at the earliest possible time.
(c) The Registrants will furnish to you without charge two (2) signed
copies (plus one (1) additional signed copy to your legal counsel) of the
Registration Statement as first filed with the Commission and of each
amendment to it, including all exhibits filed therewith, and will furnish
to you such number of conformed copies of the Registration Statement as so
filed and of each amendment to it, without exhibits, as you may reasonably
request.
(d) The Registrants will not file any amendment or supplement to the
Registration Statement, whether before or after the time when it becomes
effective, or make any amendment or supplement to the Prospectus, of which
you shall not previously have been advised and provided a copy within two
business days prior to the filing thereof (or such reasonable amount of
time as is necessitated by the exigency of such amendment or supplement) or
to which you shall reasonably object; and the Registrants will prepare and
file with the Commission, promptly upon your reasonable request, any
amendment to the Registration Statement or supplement to the Prospectus
which may be necessary or advisable in connection with the distribution of
the Shares by you, and will use their best efforts to cause any amendment
to the Registration Statement to become
8
effective as promptly as possible.
(e) Promptly after the Registration Statement becomes
effective, and from time to time thereafter for such period in your
reasonable judgment as a prospectus is required to be delivered in
connection with sales of the Shares by you, it will furnish to each
Underwriter and dealer without charge as many copies of the Prospectus
(and of any amendment or supplement to the Prospectus) as such
Underwriters and dealers may reasonably request. The Registrants
consent to the use of the Prospectus and any amendment or supplement
thereto by any Underwriter or any dealer, both in connection with the
offering or sale of the Shares and for such period of time thereafter
as the Prospectus is required by the Act or the Exchange Act to be
delivered in connection therewith.
(f) If during such period as in your reasonable judgment you are
required to deliver a prospectus in connection with sales of the Shares by
you any event shall occur as a result of which it becomes necessary to
amend or supplement the Prospectus in order to make the statements therein,
in the light of the circumstances existing as of the date the Prospectus is
delivered to a purchaser, not misleading, or if it is necessary to amend or
supplement the Prospectus to comply with any law, the Registrants will
promptly prepare and file with the Commission an appropriate amendment or
supplement to the Prospectus so that the statements in the Prospectus, as
so amended or supplemented, will not, in the light of the circumstances
existing as of the date the Prospectus is so delivered, be misleading, and
will comply with applicable law, and will furnish to each Underwriter and
dealer without charge such number of copies thereof as such Underwriters
and dealers may reasonably request.
(g) Prior to any public offering of the Shares, the Company will
cooperate with you and your counsel in connection with the registration or
qualification of the Shares for offer and sale by you under the state
securities or Blue Sky laws of such jurisdictions as you may request
(provided,
9
that the Company shall not be obligated to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified or to take
any action that would subject it to general consent to service of process
in any jurisdiction in which it is not now so subject). The Company will
continue such qualification in effect so long as required by law for
distribution of the Shares.
(h) The Company will make generally available to its security holders
as soon as reasonably practicable a consolidated earning statement covering
a period of at least twelve months beginning after the "effective date" (as
defined in Rule 158 under the Act) of the Registration Statement (but in no
event commencing later than 90 days after such date) which shall satisfy
the provisions of Section 11(a) of the Act and Rule 158 thereunder, and to
advise you in writing when such statement has been so made available.
(i) The Registrants will timely complete all required filings and
otherwise fully comply in a timely manner with all provisions of the
Exchange Act.
(j) During the period of five years hereafter, the Company will
furnish to you (i) as soon as available, a copy of each report of the
Company mailed to shareholders or filed with the Commission, and (ii) from
time to time such other information concerning the Company as you may
request.
(k) Whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated, the Registrants will pay and
be responsible for all costs, expenses, fees and taxes in connection with
or incident to (i) the printing, processing, filing, distribution and
delivery under the Act or the Exchange Act of the Registration Statement,
each preliminary prospectus, the Prospectus and all amendments or
supplements thereto, (ii) the printing, processing, execution, distribution
and delivery of this Agreement, any memoranda describing state securities
or Blue Sky laws and all other agreements, memoranda, correspondence and
10
other documents printed, distributed and delivered in connection with the
offering of the Shares, (iii) the registration with the Commission and the
issuance and delivery of the Shares, (iv) the registration or qualification
of the Shares for offer and sale under the securities or Blue Sky laws of
the jurisdictions referred to in paragraph (g) above (including, in each
case, the fees and disbursements of counsel relating to such registration
or qualification and memoranda relating thereto and any filing fees in
connection therewith), (v) furnishing such copies of the Registration
Statement, Prospectus and preliminary prospectus, and all amendments and
supplements to any of them, as may be reasonably requested by you, (vi)
filing, registration and clearance with the NASD in connection with the
offering of the Shares (including any filing fees in connection therewith
and the fees and disbursements of counsel relating thereto), (vii) any
"qualified independent underwriter" as required by Section 2720 of the
Conduct Rules of the NASD (including fees and disbursements of counsel for
such qualified independent underwriter), (viii) the printing, processing,
execution, distribution and delivery of the Transaction Documents and all
other agreements, memoranda, correspondence and other documents, printed,
distributed and delivered in connection with the Transaction Documents and
(ix) the performance by the Registrants of their other obligations under
this Agreement, the cost of their personnel and other internal costs, the
cost of printing and engraving the certificates representing the Shares,
and all expenses and taxes incident to the sale and delivery of the Shares
to you.
(l) The Company will use the proceeds from the sale of the Shares in
the manner described in the Prospectus under the caption "Use of Proceeds."
(m) The Company will cause the Shares to be quoted on the Nasdaq
National Market and will use its reasonable best efforts to maintain such
quotation while any of the Shares are outstanding.
(n) The Registrants will use their best efforts to do and perform all
things required to be
11
done and performed under this Agreement by them prior to or after the
Closing Date and to satisfy all conditions precedent on their part to
the delivery of the Shares.
(o) The Company will timely complete all required filings and
otherwise comply fully in a timely manner with all provisions of the
Exchange Act, and will file all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14(a) or 15(d) of the Exchange
Act subsequent to the date of the Prospectus and for so long as the
delivery of the Prospectus is required in connection with the offer or sale
of the Shares.
(p) During the period beginning on the date of this Agreement and
continuing to and including the Closing Date and the latest applicable
Option Closing Date, as the case may be, except as described in the
Prospectus with respect to the Pending Transactions, there will be no
transactions entered into by the Company or any of its subsidiaries (each a
"Subsidiary" and, collectively, the "Subsidiaries"), which are material
with respect to the Company or any of the Subsidiaries, respectively, taken
individually or as a whole, as determined in accordance with the provisions
and Rule 3-05 of Regulation S-X or other standards for materiality as may
be agreed upon by the Company and the Underwriters and there will be no
dividend or distribution of any kind declared, paid or made by the Company
on any class of capital stock or other equity interests.
(q) The Company will inform certain former shareholders of Regent
Communications, Inc. who in the aggregate hold shares of the Company's
Common Stocks and warrants for the Company's Common Stock that they may not
sell any of such shares or warrants pursuant to the shelf registration
statement currently in effect providing for the registration and
distribution of such shares and warrants for a period of 45 days from the
date of the Prospectus.
6. REPRESENTATIONS AND WARRANTIES. The Regis-
12
rants represent and warrant to each of you that:
(a) When the Registration Statement becomes effective, including at
the date of any post-effective amendment, at the date of the Prospectus (if
different) and at the Closing Date, the Registration Statement will comply
in all material respects with the provisions of the Act, and will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading; the Prospectus and any supplements or
amendments thereto will not at the date of the Prospectus, at the date of
any such supplements or amendments and at the Closing Date contain any
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties contained in this paragraph (a) shall not
apply to statements in or omissions from the Registration Statement or the
Prospectus (or any supplement or amendment to them) made in reliance upon
and in conformity with information relating to any Underwriter furnished to
the Company in writing by or on behalf of any Underwriter through DLJ
expressly for use therein. The Company acknowledges for all purposes under
this Agreement that the statements with respect to price and underwriting
discount and the last paragraph all as set forth on the cover page and in
paragraph four under the caption "Underwriting" in the Prospectus (or any
amendment or supplement) constitute the only written information furnished
to the Company by DLJ expressly for use in the Registration Statement or
the Prospectus (or any amendment or supplement to them) and that the
Underwriters shall not be deemed to have provided any other information
(and therefore are not responsible for any such statement or omission).
(b) Any term sheet and prospectus subject to completion provided by
the Company to the Underwriters for use in connection with the offering and
sale of the Shares pursuant to Rule 434 under the Act together are not
materially different from the
13
Prospectus included in the Registration Statement.
(c) Each preliminary prospectus and the 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 Act, and each Registration
Statement filed pursuant to Rule 462(b) under the Act, if any, complied
when so filed in all material respects with the Act.
(d) The Company and each of its Subsidiaries and Premiere has been
duly organized, is validly existing as a corporation in good standing under
the laws of its jurisdiction of organization and has the requisite
corporate power and authority to carry on its business as it is currently
being conducted, to own, lease and operate its properties and, as
applicable, to authorize the offering of the Shares, to execute, deliver
and perform this Agreement, and to issue, sell and deliver the Shares, and
to execute, deliver and perform the Transaction Documents, as applicable,
and each is duly qualified and is in good standing as a foreign corporation
authorized to do business in each jurisdiction where the operation,
ownership or leasing of property or the conduct of its business requires
such qualification, except where the failure to be so qualified could not,
singly or in the aggregate, reasonably be expected to have a material
adverse effect on the respective properties, business, results of
operations, condition (financial or otherwise), affairs or prospects of
each of the Company and the Subsidiaries taken as a whole (a "Material
Adverse Effect").
(e) All of the issued and outstanding shares of capital stock of, or
other ownership interests in, each Subsidiary have been duly and validly
authorized and issued, and all of the shares of capital stock of, or other
ownership interests in, each Subsidiary are owned, directly or through
Subsidiaries, by the Company and, upon completion of the transactions
contemplated by the Transaction Documents, all of the shares of capital
stock of, or other ownership interests in the assets of Premiere will be
owned directly or through Subsidiaries, by
14
the Company. All such shares of capital stock are fully paid and
nonassessable, and are owned free and clear of any security interest,
mortgage, pledge, claim, lien or encumbrance (each, a "Lien"), except
for Liens arising under the Credit Agreement, dated as of June 12, 1996,
as amended and restated as of February 14, 1997, by and among The Chase
Manhattan Bank (as successor by merger to Chemical Bank), as
Administrative Agent, Banque Paribas, as Documentation Agent, and Bank
of America, Illinois, as Syndication Agent (the "Credit Facility".)
There are no outstanding subscriptions, rights, warrants, options,
calls, convertible securities, commitments of sale or Liens related to
or entitling any person to purchase or otherwise to acquire any shares
of the capital stock of, or other ownership interest in, any Subsidiary
and, with respect to Premiere, except for the Premiere Merger and stock
options issued by Premiere which options will be cancelled in connection
with the Premiere Merger.
(f) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus under "Capitalization"; all the
shares of issued and outstanding Common Stock have been duly authorized and
validly issued and are fully paid, nonassessable and not subject to any
preemptive or similar rights; the Shares have been duly authorized for
issuance and sale to the Underwriters pursuant to this Agreement and, when
issued and delivered by the Company pursuant to this Agreement against
payment of the consideration set forth herein, will be validly issued and
fully paid and nonassessable; the capital stock of the Company, including
the Common Stock, conforms in all material respects to all statements
relating thereto in the Prospectus and the Registration Statement; and the
issuance of the Shares by the Company will not be subject to preemptive or
other similar rights.
(g) None of the Company, any of the Subsidiaries and Premiere is in
violation of their respective charters or bylaws or in default in the
performance of any bond, debenture, note or any other evidence of
indebtedness or any indenture, mortgage, deed of trust or other contract,
lease or other instrument
15
to which the Company or any of the Subsidiaries or Premiere is a
party or by which any of them is bound, or to which any of the property
or assets of the Company or any of the Subsidiaries or Premiere is
subject, except, in the case of Premiere, as could not have a Material
Adverse Effect.
(h) The Transaction Documents have been duly authorized and validly
executed and delivered by the Registrants and constitute valid and legally
binding agreements of the Registrants, as applicable, enforceable against
the Registrants, as applicable, in accordance with their terms (assuming,
in the case of each of the Transaction Documents, the due execution and
delivery thereof by each party thereto).
(i) The execution and delivery of this Agreement by the Registrants,
the issuance and sale of the Shares, the performance of this Agreement and
the consummation of the transactions contemplated by this Agreement and the
execution and delivery of the Transaction Documents by each of the
Registrants and Premiere, as applicable, and the consummation of the
Pending Transactions will not (1) conflict with or result in a breach or
violation of any of the respective charters or bylaws of the Company or any
of the Subsidiaries or Premiere or any of the terms or provisions of,
except, in the case of Premiere, as could not have a Material Adverse
Effect or (2) constitute a default or cause an acceleration of any
obligation under or result in the imposition or creation of (or the
obligation to create or impose) a Lien with respect to, any bond, note,
debenture or other evidence of indebtedness or any indenture, mortgage,
deed of trust or other agreement or instrument to which the Company or any
of the Subsidiaries or Premiere is a party or by which it or any of them is
bound, or to which any properties of the Company or any of the Subsidiaries
or Premiere is or may be subject, except, in the case of Premiere, as could
not have a Material Adverse Effect, or (3) contravene any order of any
court or governmental agency or body having jurisdiction over the Company
or any of the Subsidiaries or Premiere or any of their properties, or
violate or conflict with any
16
statute, rule or regulation or administrative or court decree applicable
to the Company or any of the Subsidiaries or Premiere or any of their
respective properties, except, in the case of Premiere, as could not
have a Material Adverse Effect.
(j) There is no action, suit or proceeding before or by any court or
governmental agency or body, domestic or foreign, pending against or
affecting the Company or any of the Subsidiaries or Premiere or any of
their respective properties, which is required to be disclosed in the
Registration Statement or the Prospectus, or which could reasonably be
expected to result, singly or in the aggregate, in a Material Adverse
Effect or which could reasonably be expected to materially and adversely
affect the consummation of this Agreement or the transactions contemplated
hereby or the consummation of the Transaction Documents or the Pending
Transactions, and to the best of the Company's knowledge, no such
proceedings are contemplated or threatened. No contract or document of a
character required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement is
not so described or filed.
(k) No action has been taken and no statute, rule or regulation or
order has been enacted, adopted or issued by any governmental agency or
body which prevents the issuance of the Shares, suspends the effectiveness
of the Registration Statement, prevents or suspends the use of any
preliminary prospectus or suspends the sale of the Shares in any
jurisdiction referred to in Section 4(g) hereof; no injunction, restraining
order or order of any nature by a Federal or state court of competent
jurisdiction has been issued with respect to the Company or any of the
Subsidiaries which would prevent or suspend the issuance or sale of the
Shares, the effectiveness of the Registration Statement, or the use of any
preliminary prospectus in any jurisdiction referred to in Section 4(g)
hereof; no action, suit or proceeding is pending against or, to the best of
the Company's knowledge, threatened against or affecting the Company or any
of the Subsidiaries
17
before any court or arbitrator or any governmental body, agency or
official, domestic or foreign, which, if adversely determined, would
materially interfere with or adversely affect the issuance of the Shares
or in any manner draw into question the validity of the Transaction
Documents; and every request of the Commission or any securities
authority or agency of any jurisdiction for additional information (to
be included in the Registration Statement or the Prospectus or
otherwise) has been complied with in all material respects.
(l) (i) None of the Company, any of the Subsidiaries and Premiere is
in violation of any Federal, state or local laws and regulations relating
to pollution or protection of human health or the environment (including,
without limitation, ambient air, surface water, ground water, land surface
or subsurface strata), including, without limitation, laws and regulations
relating to emissions, discharges, releases or threatened releases of toxic
or hazardous substances, materials or wastes, or petroleum and petroleum
products ("Materials of Environmental Concern"), or otherwise relating to
the protection of human health and safety, or the storage, disposal,
transport or handling of Materials of Environmental Concern (collectively,
"Environmental Laws"), which violation includes, but is not limited to,
noncompliance with any permits or other governmental authorizations, except
to the extent that any such violation could not have a Material Adverse
Effect or otherwise require disclosure in the Prospectus; and (ii) to the
best knowledge of the Company and any of the Subsidiaries, after due
inquiry, (A) none of the Company, any of the Subsidiaries, Premiere and any
of the other parties to the Transaction Documents (the "Pending Transaction
Parties") with respect to the properties and radio stations to be purchased
or sold pursuant to the Transaction Documents (the "Pending Properties")
has received any communication (written or oral), whether from a
governmental authority or otherwise, alleging any such violation or
noncompliance, and there are no circumstances, either past, present or that
are reasonably foreseeable, that may lead to such violation in the future,
(B) there is no pend-
18
ing or threatened claim, action, investigation or notice (written or
oral) by any person or entity alleging potential liability for
investigatory, cleanup, or governmental responses costs, or natural
resources or property damages, or personal injuries, attorney's fees or
penalties relating to (x) the presence, or release into the environment,
of any Material of Environmental Concern at any location owned or
operated by the Company, any of the Subsidiaries, Premiere, and the
Pending Transaction Parties with respect to the Pending Properties, now
or in the past, or (y) circumstances forming the basis of any violation,
or alleged violation, of any Environmental Law (collectively,
"Environmental Claims") that could have a Material Adverse Effect or
otherwise require disclosure in the Prospectus, and (C) there are no
past or present actions, activities, circumstances, conditions, events
or incidents, that could form the basis of any Environmental Claim
against the Company, any of the Subsidiaries, Premiere, and the Pending
Transaction Parties with respect to the Pending Properties, or against
any person or entity whose liability for any Environmental Claim the
Company, any of the Subsidiaries, Premiere, and the Pending Transaction
Parties with respect to the Pending Properties, have retained or assumed
either contractually or by operation of law. In the ordinary course of
its business, each of the Company and the Subsidiaries and Premiere
conducts a periodic review of the effect of Environmental Laws on the
business, operations and properties of the in the course of which it
identifies and evaluates associated costs and liabilities (including,
without limitation, any capital or operating expenditures required for
clean-up, closure of properties or compliance with Environmental Laws or
any permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties); on the basis
of such review, the Company and the Subsidiaries, have reasonably
concluded that such associated costs and liabilities could not have a
Material Adverse Effect.
(m) None of the Company, any of the Subsidiaries, Premiere, and to
the knowledge of the Company,
19
the Pending Transaction Parties with respect to the Pending Properties,
has violated any Federal, state or local law relating to discrimination
in the hiring, promotion or pay of employees nor any applicable wage or
hour laws, nor any provisions of the Employee Retirement Income Security
Act of 1974 ("ERISA") or the rules and regulations promulgated
thereunder, nor has the Company or any of the Subsidiaries or Premiere
or, to the knowledge of the Company, the Pending Transaction Parties
with respect to the Pending Properties, engaged in any unfair labor
practice, which in each case described in this sentence could reasonably
be expected to result, singly or in the aggregate, in a Material Adverse
Effect. There is (i) no significant unfair labor practice complaint
pending against the Company or any of the Subsidiaries or Premiere or,
to the knowledge of the Company, the Pending Transaction Parties with
respect to the Pending Properties, or, to the best knowledge of the
Company, threatened against any of them, before the National Labor
Relations Board or any state or local labor relations board, and no
significant grievance or significant arbitration proceeding arising out
of or under any collective bargaining agreement is so pending against
the Company or any of the Subsidiaries or Premiere or, to the knowledge
of the Company, the Pending Transaction Parties with respect to the
Pending Properties, or, to the best knowledge of the Company, threatened
against any of them, (ii) no significant strike, labor dispute, slowdown
or stoppage pending against the Company or any of its Subsidiaries or
Premiere or, to the knowledge of the Company, the Pending Transaction
Parties with respect to the Pending Properties, or, to the best
knowledge of the Company, threatened against the Company or any of the
Subsidiaries, Premiere, or the Pending Transaction Parties with respect
to the Pending Properties and (iii) to the best knowledge of the
Company, no union representation question existing with respect to the
employees of the Company or any of the Subsidiaries, or the Pending
Transaction Parties with respect to the Pending Properties, and, to the
best knowledge of the Company, no union organizing activities are taking
place, except (with respect to any matter specified in clause (i),
20
(ii) or (iii) above, singly or in the aggregate) such as could not have
a Material Adverse Effect.
(n) The Company, each of its Subsidiaries and Premiere each have good
and marketable title, free and clear of all Liens, to all property and
assets described in the Registration Statement as being owned by it, except
for (i) Liens pursuant to the Credit Facility and (ii) Liens on general
office equipment which are not material to the Company's operations. All
leases to which the Company, the Subsidiaries or Premiere are a party are
valid and binding and no default has occurred or is continuing thereunder
and the Company, each of its Subsidiaries and Premiere enjoy peaceful and
undisturbed possession under all such leases to which any of them is a
party as lessee with such exceptions as do not materially interfere with
the use made by the Company or any such Subsidiary or Premiere.
(o) The respective firm of accountants that has certified or shall
certify the applicable consolidated financial statements and supporting
schedules of the Company, E.F.M. Media Management, Inc., E.F.M. Publishing,
Inc. and XXX Media, Inc. (the "Combined E.F.M. Companies"), and Premiere
filed, to be filed or incorporated by reference with the Commission as part
of the Registration Statement and the Prospectus are independent public
accountants with respect to the Company, the Subsidiaries and the Combined
E.F.M. Companies and Premiere, as required by the Act. The consolidated
historical and PRO FORMA financial statements, together with related
schedules and notes, set forth in the Prospectus and the Registration
Statement comply as to form in all material respects with the requirements
of the Act. Such historical financial statements fairly present the
consolidated financial position of the Company, the Subsidiaries and the
Combined E.F.M. Companies and Premiere, at the respective dates indicated
and the results of their operations and their cash flows for the respective
periods indicated, in accordance with generally accepted accounting
principles ("GAAP") consistently applied throughout such periods. Such PRO
FORMA financial statements have been prepared on a basis consistent with
such
21
historical statements, except for the PRO FORMA adjustments specified
therein, and give effect to assumptions made on a reasonable basis and
present fairly the historical and proposed transactions contemplated by
the Prospectus and the Transaction Documents. The other financial and
statistical information and data included in the Prospectus and in the
Registration Statement, historical and PRO FORMA, are, in all material
respects, accurately presented and prepared on a basis consistent with
such financial statements and the books and records of the Company and
the Combined E.F.M. Companies and Premiere.
(p) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus and up to the
Closing Date, none of the Company, any of the Subsidiaries or Premiere have
incurred any liabilities or obligations, direct or contingent, which are
material to the Company and the Subsidiaries taken as a whole, nor entered
into any transaction not in the ordinary course of business and there has
not been, singly or in the aggregate, any material adverse change, or any
development which could reasonably be expected to involve a material
adverse change, in the properties, business, results of operations,
condition (financial or otherwise), affairs or prospects of the Company and
the Subsidiaries taken as a whole (a "Material Adverse Change").
(q) All tax returns required to be filed by the Company, any of the
Subsidiaries and Premiere in any jurisdiction have been filed, other than
those filings being contested in good faith, and all material taxes,
including withholding taxes, penalties and interest, assessments, fees and
other charges due or claimed to be due from such entities have been paid,
other than those being contested in good faith and for which adequate
reserves have been provided or those currently payable without penalty or
interest.
(r) No authorization, approval or consent or order of, or filing
with, any court or governmental body or agency is necessary in connection
with the
22
transactions contemplated by the Pending Transactions, except such
as may be required by the NASD or have been obtained and made under the
Act, the Exchange Act, the Trust Indenture Act of 1939, as amended (the
"TIA") or state securities or "Blue Sky" laws or regulations. Neither the
Company nor any of its affiliates is presently doing business with the
government of Cuba or with any person or affiliate located in Cuba.
23
(s) (i) Each of the Company, the Subsidiaries and Premiere and, to
the knowledge of the Company, any of the Pending Transaction Parties with
respect to the Pending Properties, has all certificates, consents,
exemptions, orders, permits, licenses, authorizations, or other approvals
(each, an "Authorization") of and from, and has made all declarations and
filings with, all Federal, state, local and other governmental authorities
(including the Federal Communications Commission ("FCC")), all self-
regulatory organizations and all courts and other tribunals, necessary or
required to own, lease, license and use its properties and assets and to
conduct its business in the manner described in the Prospectus, except to
the extent that the failure to obtain or file could not, singly or in the
aggregate, reasonably be expected to have a Material Adverse Effect, (ii)
all such Authorizations are valid and in full force and effect, (iii) each
of the Company, the Subsidiaries and Premiere and, to the knowledge of the
Company, the Pending Transaction Parties with respect to the Pending
Properties, is in compliance in all material respects with the terms and
conditions of all such Authorizations and with the rules and regulations of
the regulatory authorities and governing bodies having jurisdiction with
respect thereto and (iv) each commercial radio broadcast station identified
in the Prospectus as owned and operated by any of the Company, the
Subsidiaries or Premiere, or, to the knowledge of the Company, the Pending
Transaction Parties with respect to the Pending Properties, as applicable,
is operating with the maximum facilities specified by the Authorization
pertaining thereto.
(t) Neither the Company nor any of the Subsidiaries is (a) an
"investment company" or a company "controlled" by an investment company
within the meaning of the Investment Company Act of 1940, as amended, or
(b) a "holding company" or a "subsidiary company" of a holding company, or
an "affiliate" thereof within the meaning of the Public Utility Holding
Company Act of 1935, as amended.
24
(u) No holder of any security of the Company has or will have any
right to require the registration of such security by virtue of any
transaction contemplated by this Agreement.
(v) The Shares have been approved for quotation on the Nasdaq
National Market, subject to notice of issuance.
(w) Each of the Company, the Subsidiaries and Premiere and, to the
knowledge of the Company, the Pending Transaction Parties with respect to
the Pending Properties, possesses the patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks and trade names
(collectively, "Intellectual Property") presently employed by them in
connection with the businesses now operated by them, and none of the
Company, the Subsidiaries and Premiere, and, to the knowledge of the
Company, the Pending Transaction Parties with respect to the Pending
Properties, has received any notice of infringement of or conflict with
asserted rights of others with respect to the foregoing which, singly or in
the aggregate, could reasonably be expected to result in any Material
Adverse Change. The use of such Intellectual Property in connection with
the business and operations of each of the Company, the Subsidiaries and
Premiere, and, to the knowledge of the Company, the Pending Transaction
Parties with respect to the Pending Properties does not, to the Company's
knowledge, infringe on the rights of any person except where any such
infringement has not resulted in, or could not reasonably be expected to
result in any Material Adverse Change.
(x) Each certificate signed by any officer of the Company and
delivered to the Underwriters or counsel for the Underwriters shall be
deemed to be a representation and warranty by the Company to each
Underwriter as to the matters covered thereby.
(y) Each of the Company, the Subsidiaries and Premiere maintains a
system of internal accounting
25
controls sufficient to provide reasonable assurance that (1)
transactions are executed in accordance with management's general or
specific authorizations; (2) transactions are recorded as necessary to
permit preparation of financial statements in conformity with GAAP and
to maintain asset accountability; (3) access to assets is permitted only
in accordance with management's general or specific authorization; and
(4) the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(z) The Company has not (i) taken, directly or indirectly, any action
designed to cause or to result in, or that has constituted or which could
reasonably be expected to constitute, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale
of the Shares or (ii) since the initial filing of the Registration
Statement (A) sold, bid for, purchased, or paid anyone any compensation for
soliciting purchases of, the Shares or (B) paid or agreed to pay to any
person any compensation for soliciting another to purchase any other
securities of the Company.
(aa) Each of the Company, the Subsidiaries and Premiere and, to the
knowledge of the Company, the Pending Transaction Parties with respect to
the Pending Properties, maintains insurance covering their properties,
operations, personnel and businesses. Such insurance insures against such
losses and risks as are adequate in accordance with customary industry
practice to protect the Company and its Subsidiaries and their businesses.
None of the Company, any Subsidiary and Premiere, and, to the knowledge of
the Company, the Pending Transaction Parties with respect to the Pending
Properties, has received notice from any insurer or agent of such insurer
that substantial capital improvements or other expenditures will have to be
made in order to continue such insurance. All such insurance is
outstanding and duly in force on the date hereof and will be outstanding
and duly in force on the Closing Date.
26
(bb) Neither the Company nor Premiere has, directly or indirectly,
paid or delivered any fee, commission or other sum of money or item or
property, however characterized, to any finder, agent, government official
or other party, in the United States or any other country, which is in any
manner related to the business or operations of the Company or Premiere,
respectively, which the Company knows or has reason to believe to have been
illegal under any Federal, state or local laws of the United States or any
other country having jurisdiction; and neither the Company nor Premiere has
participated, directly or indirectly, in any boycotts or other similar
practices in contravention of law affecting any of its actual or potential
customers.
(cc) Neither the Company nor Premiere owns any "margin securities" as
that term is defined in Regulations G and U of the Board of Governors of
the Federal Reserve System (the "Federal Reserve Board"), and, except as
disclosed in the Prospectus, none of the proceeds of the sale of the Shares
will be used, directly or indirectly, for the purpose of purchasing or
carrying any margin security, for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase or carry any margin
security or for any other purpose which might cause any of the Shares to be
considered a "purpose credit" within the meanings of Regulation G, T, U or
X of the Federal Reserve Board.
(dd) Each person described in the Prospectus as a person to whom the
Company or any of the Subsidiaries provides programming pursuant to a local
marketing agreement or a joint sales agreement (a "Licensee") has been
issued by the FCC an FCC license (which is in full force and effect) for
the operation of the commercial radio broadcast station identified in the
Prospectus as programmed by the Company or any of its Subsidiaries, which
licenses expire on the dates set forth in the Prospectus.
(ee) Each person described in the Prospectus as a person to whom the
Company or any of the Subsidiaries provides programming pursuant to an
exclu-
27
sive sales agency agreement (a "Mexican Licensee"), has been issued by
the Mexican government all necessary Mexican licenses (which are in full
force and effect) for the operation of the commercial radio broadcast
station identified in the Prospectus as programmed by the Company or any of
its Subsidiaries. Each of the Company and its Subsidiaries have all
Authorizations necessary to deliver programming to the Mexican Licensees.
(ff) Each of the Company, its Subsidiaries and Premiere and, to the
knowledge of the Company, the Pending Transaction Parties with respect to
the Pending Properties, has filed with the FCC all material reports,
documents, instruments, information and applications required to be filed
pursuant to the FCC's rules, regulations and requests. No notice has been
issued by the FCC which could permit, or after notice or lapse of time or
both could permit, revocation or termination of any FCC license of any of
the Subsidiaries, Premiere or, to the knowledge of the Company, the Pending
Transaction Parties with respect to the Pending Properties, or to the
knowledge of the Company, of any of the Licensees prior to the expiration
dates thereof or which could reasonably be expected to result in any other
material impairment of any of the Subsidiaries', or Premiere or its
subsidiaries, or, to the knowledge of the Company, the Pending Transaction
Parties or their subsidiaries with respect to the Pending Properties, or,
to the knowledge of the Company, of any of the Licensees' rights thereunder
and which could reasonably be expected to, singly or in the aggregate, have
a Material Adverse Effect.
(gg) Each of the Company's radio and television stations (the
"Stations")is now operating, and has operated, in compliance in all
material respects with the Communications Act of 1934, as amended (the
"Communications Act"), and the published rules and regulations of the FCC.
There is not issued, outstanding or pending any Notice of Violation, Notice
of Apparent Liability, Order to Show Cause, material complaint or
investigation by or before the FCC which could materially threaten or
materially adversely affect any of the Company's or any of its
28
Subsidiaries', Premiere or its subsidiaries', or, to the knowledge of the
Company, the Pending Transaction Parties or their subsidiaries' with
respect to the Pending Properties, or, to the knowledge of the Company, any
Licensees' FCC licenses or which could reasonably be expected to result in
any material adverse effect upon any of the Company's Subsidiaries,
Premiere or its subsidiaries, or, to the knowledge of the Company, the
Pending Transaction Parties or their subsidiaries with respect to the
Pending Properties, or, to the knowledge of the Company, any Licensees'
operation of its respective stations and which could reasonably be expected
to, singly or in the aggregate, have a Material Adverse Effect, nor does
the Company have reason to believe that the FCC licenses with respect to
the Stations will not be renewed for a full eight year term when such FCC
licenses are due for renewal.
(hh) The execution, delivery and performance of the obligations by
the Company under this Agreement are not and will not be contrary to the
Communications Act, as amended, will not result in any violation of the
FCC's published rules and regulations, will not cause any forfeiture or
impairment of any FCC license of any of the Stations by or before the FCC,
and will not require any consent, approval or authorization of the FCC.
(ii) The execution, delivery and performance of the obligations by
the Company, PRN Holding and Premiere (each, a "Premiere Transaction Party"
and, collectively, the "Premiere Transaction Parties") and, to the
knowledge of the Company, by the Pending Transaction Parties with respect
to the Pending Properties to the extent each is a party to the Transaction
Documents are not and will not be contrary to the Communications Act, will
not result in any violation of the FCC's published rules and regulations,
will not cause any forfeiture or impairment of any FCC license of any of
the Stations by or before the FCC, and will not require any consent,
approval or authorization of the FCC. All necessary applications, exhibits
or other filings required by the FCC for transfer of control of the
Stations now controlled by the Pending Transaction
29
Parties with respect to the Pending Properties pursuant to the
applicable Transaction Documents have been filed with the FCC (the
"Transfer Applications"). To the best of the Company's knowledge, there
are no circumstances that would cause the FCC to reject the Transfer
Applications.
(jj) The Premiere Transaction Parties and, to the knowledge of the
Company, the Pending Transaction Parties, have, to the extent each is or
will be a party thereto, all requisite corporate power and authority to
execute, deliver and perform their respective obligations under each of the
Transaction Documents; each of the Transaction Documents has been duly and
validly authorized, executed and delivered by the Premiere Transaction
Parties and, to the knowledge of the Company, the Pending Transaction
Parties, to the extent each is a party thereto, and each constitutes a
valid and legally binding agreement of the Premiere Transaction Party and,
to the knowledge of the Company, the Pending Transaction Parties,
enforceable against each Premiere Transaction Party or Pending Transaction
Party, as applicable, in accordance with its terms; except as set forth in
the Prospectus, no consent, approval, authorization or order of any court
or governmental agency or body is required for the performance of any of
the Transaction Documents by each of the Premiere Transaction Parties or,
to the knowledge of the Company, each Pending Transaction Party, to the
extent each is a party thereto, or the consummation by each of the Premiere
Transaction Parties, or to the knowledge of the Company, each of the
Pending Transaction Parties, of any of the transactions contemplated
thereby, except such as may be required and have been obtained, or upon
effectiveness of the Registration Statement, will have been obtained, under
the Act, the Exchange Act, the TIA, or state securities or "Blue Sky" laws
or regulations or such as may be required by the NASD in connection with
the purchase and distribution of the Shares by the Underwriters; and none
of the Premiere Transaction Parties, is (i) in violation of its charter or
bylaws, (ii) in violation of any statute, judgment, decree, order, rule or
regulation applicable to any of them or any of their respective properties
or
30
assets, which violation would have a Material Adverse Effect, or (iii)
in default in the performance or observance of any obligation, agreement,
covenant or condition contained in any of the Transaction Documents or any
other contract, indenture, mortgage, deed of trust, loan agreement, note,
lease, license, franchise agreement, permit, Authorizations, certificate or
agreement or instrument to which any of them is a party or to which any of
them is subject, which default would have a Material Adverse Effect.
(kk) The execution, delivery and performance by the Premiere
Transaction Parties, to the extent each is a party thereto, of each of the
Transaction Documents, and the consummation by the respective Premiere
Transaction Parties of the transactions contemplated thereby, will not
violate, conflict with or constitute or result in a breach of or a default
under (or an event which, with notice or lapse of time, or both, would
constitute a breach of or a default under) any of (i) the terms or
provisions of any of the Transaction Documents or any other indenture,
mortgage, deed of trust, loan agreement, note, lease, license, franchise
agreement, or agreement or instrument to which a Premiere Transaction
Party, is a party or to which any of their respective properties or assets
are subject, which violation, conflict, breach or default would have a
Material Adverse Effect, (ii) the charter or bylaws of the Premiere
Transaction Party, or (iii) any statute, judgment, decree, order, rule or
regulation of any court, governmental agency or other body or self
regulatory organization applicable to each Premiere Transaction Party, or
any of their respective properties or assets, which violation, conflict,
breach or default would have a Material Adverse Effect.
(ll) The Premiere Merger has been duly authorized by the Premiere
Transaction Parties and the transactions contemplated by the Transaction
Documents have been approved, to the extent required, by all appropriate
corporate action; approval of the transactions contemplated by the
Transaction Documents by the shareholders of the Company is not
31
required.
(mm) The Company has delivered to the Underwriters a true and correct
copy of each of the Transaction Documents that have been executed and
delivered prior to the date of this Agreement and each other Transaction
Document in the form substantially as it will be executed and delivered,
together with all related agreements and all schedules and exhibits
thereto, and there have been no amendments, alterations, modifications or
waivers of any of the provisions of any of the Transaction Documents since
their date of execution or from the form in which it has been delivered to
the Underwriters; there exists as of the date hereof (after giving effect
to the transactions contemplated by the Transaction Documents) no event or
condition which would constitute a default or an event of default (in each
case as defined in the Credit Facility) under the Credit Facility, and no
event or condition which would constitute a default or an event of default
(in each case as defined in each of the Transaction Documents) under any of
the Transaction Documents other than the Credit Facility, which would
result in a Material Adverse Effect or materially adversely effect the
ability of each of the Company or Premiere to consummate the transactions
contemplated by the Transaction Documents.
(nn) No director, officer or substantial shareholder of the Company
has a 5% or greater interest (or no such persons collectively have a 10% or
greater interest), directly or indirectly, in Premiere.
(oo) The shares of Common Stock to be issued pursuant to the Premiere
Merger Agreement and pursuant to the terms of the other Pending
Transactions, will not, in the aggregate, have upon issuance, voting power
equal to or in excess of 20% of the voting power outstanding before the
issuance of the Common Stock or securities convertible into or exercisable
for Common Stock.
(pp) The Company has filed with the Commission all filings that are
required to be filed as of the
32
date hereof with respect to the financial statements of each of the
Premiere and each of the Pending Transaction Parties in filings made
under the Act and under the Exchange Act, specifically as required by
Rule 3-05 of Regulation S-X and General Instructions and Item 7 of Form
8-K.
(ss) Each of the representations and warranties contained in each of
the Transaction Documents are true and correct on and as of the date
hereof, except as could not have a Material Adverse Effect.
(tt) The Company meets the requirements for registering an offering
of securities with the Commission on registration statement Form S-3
pursuant to the standards for those Forms prior to October 21, 1992.
7. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless (i) each of the
Underwriters and (ii) each person, if any, who controls (within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act) any of the
Underwriters (any of the persons referred to in this clause (ii) being
hereinafter referred to as a "controlling person"), and (iii) the
respective officers, directors, partners, employees, representatives and
agents of any of the Underwriters or any controlling person (any person
referred to in clause (i), (ii) or (iii) may hereinafter be referred to as
an "Indemnified Person") to the fullest extent lawful, from and against any
and all losses, claims, damages, liabilities, judgments, actions and
expenses (including without limitation and as incurred, reimbursement of
all reasonable costs of investigating, preparing, pursuing or defending any
claim or action, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, including the reasonable fees and
expenses of counsel to any Indemnified Person) directly or indirectly
caused by, related to, based upon, arising out of or in connection with any
untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement (or any amendment thereto), including the
33
information deemed to be a part of the Registration Statement or the
Prospectus (including any amendment or supplement thereto) or any
preliminary prospectus, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading, PROVIDED,
HOWEVER, that (i) except insofar as such losses, claims, damages,
liabilities, judgments, actions or expenses are caused by an untrue
statement or omission or alleged untrue statement or omission that is made
in reliance upon and in conformity with information relating to any of the
Underwriters furnished in writing to the Company by DLJ expressly for use
in the Registration Statement (or any amendment thereto) or the Prospectus
(or any amendment or supplement thereto) or any preliminary prospectus,
(ii) the foregoing indemnity agreement with respect to any untrue statement
contained in or omission from a preliminary prospectus shall not inure to
the benefit of the Underwriter from whom the person asserting any such
losses, liabilities, claims, damages or expenses 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 amendments
or supplements thereto) was not sent or given by or on behalf of the
Underwriters to such person, if such is required by law, at or prior to the
written confirmation of the sale of such Shares to such person and the
untrue statement contained in or omission from such preliminary prospectus
was corrected in the Prospectus (or the Prospectus as amended or
supplemented). The Company shall notify you promptly of the institution,
threat or assertion of any claim, proceeding (including any governmental
investigation) or litigation in connection with the matters addressed by
this Agreement which involves the Company or an Indemnified Person.
(b) In case any action or proceeding (including any governmental
investigation) shall be brought or asserted against any of the Indemnified
Persons with respect to which indemnity may be sought against the Company,
such Underwriter (or the Under-
34
writer controlled by such controlling person) shall promptly notify the
Company in writing (provided, that the failure to give such notice shall
not relieve the Company of its obligations pursuant to this Agreement).
Such Indemnified Person shall have the right to employ its own counsel
in any such action and the fees and expenses of such counsel shall be
paid, as incurred, by the Company (regardless of whether it is
ultimately determined that an Indemnified Party is not entitled to
indemnification hereunder). The Company shall not, in connection with
any one such action or proceeding or separate but substantially similar
or related actions or proceedings in the same jurisdiction arising out
of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys
(in addition to any local counsel) at any time for such Indemnified
Persons, which firm shall be designated by DLJ. The Company shall be
liable for any settlement of any such action or proceeding effected with
the Company's prior written consent, which consent will not be
unreasonably withheld, and the Company agrees to indemnify and hold
harmless any Indemnified Person from and against any loss, claim,
damage, liability or expense by reason of any settlement of any action
effected with the written consent of the Company. Notwithstanding the
foregoing sentence, if at any time an Indemnified Person shall have
requested the Company to reimburse the Indemnified Person for fees and
expenses of counsel as contemplated by the second sentence of this
paragraph, the Company agrees that it shall be liable for any settlement
of any proceeding effected without the Company's written consent if (i)
such settlement is entered into more than 10 business days after receipt
by the Company of the aforesaid request, and (ii) the Company shall not
have reimbursed the Indemnified Person in accordance with such request
prior to the date of such settlement. The Company shall not, without
the prior written consent of each Indemnified Person, settle or
compromise or consent to the entry of judgment in or otherwise seek to
terminate any pending or threatened action, claim, litigation or
proceeding in respect of which indemnification or contribution may be
sought hereunder
35
(whether or not any Indemnified Person is a party thereto), unless such
settlement, compromise, consent or termination includes an unconditional
release of each Indemnified Person from all liability arising out of
such action, claim, litigation or proceeding.
(c) Each of the Underwriters agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers who
sign the Registration Statement, any person controlling (within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act) the Company,
and the officers, directors, partners, employees, representatives and
agents of each such person, to the same extent as the foregoing indemnity
from the Registrants to each of the Indemnified Persons, but only with
respect to claims and actions based on information relating to such
Underwriter furnished in writing by DLJ expressly for use in the
Prospectus.
(d) If the indemnification provided for in this Section 6 is
unavailable to an indemnified party in respect of any losses, claims,
damages, liabilities, judgments, actions or expenses referred to herein,
then each indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages, liabilities, judgments,
actions and expenses (i) in such proportion as is appropriate to reflect
the relative benefits received by the indemnifying party on the one hand
and the indemnified party 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 parties and the indemnified party, as well as any
other relevant equitable considerations. The relative benefits received by
the Company, on the one hand, and any of the Underwriters, on the other
hand, shall be deemed to be in the same proportion as the total proceeds
from the offering (net of underwriting discounts and commissions but before
36
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by such Underwriter, in each case as set
forth in the table on the cover page of the Prospectus. The relative fault
of the Company and the Underwriters 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
related to information supplied by the Company or the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The indemnity and
contribution obligations of the Company set forth herein shall be in
addition to any liability or obligation the Company may otherwise have to
any Indemnified Person.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by
PRO RATA allocation (even if the Underwriters were treated as one entity
for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as
a result of the losses, claims, damages, liabilities, judgments, actions or
expenses 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 Xxxxxxx 0, xxxx of the Underwriters (and its related
Indemnified Persons) shall be required to contribute, in the aggregate, any
amount in excess of the amount by which the total underwriting discount
applicable to the Shares purchased by such Underwriter exceeds the amount
of any damages which such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution
37
from any person who was not guilty of such fraudulent misrepresentation.
The Underwriters' obligations to contribute pursuant to this Section
7(d) are several in proportion to the respective number of Shares
purchased by each of the Underwriters hereunder and not joint.
8. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations
of the Underwriters to purchase the Company under this Agreement are subject to
the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Shares contained in
this Agreement shall be true and correct on the Closing Date with the same
force and effect as if made on and as of the Closing Date. The Company
shall have performed or complied with all of its obligations and agreements
herein contained and required to be performed or complied with by it at or
prior to the Closing Date.
(b) (i) The Registration Statement shall have become effective (or,
if a post-effective amendment is required to be filed pursuant to Rule 430A
promulgated under the Act, such post-effective amendment shall have become
effective) not later than 10:00 A.M. (and in the case of a Registration
Statement filed under Rule 462(b) of the Act, not later than 10:00 P.M.),
New York City time, on the date of this Agreement or at such later date and
time as you may approve in writing, (ii) at the Closing Date, no stop order
suspending the effectiveness of the Registration Statement shall have been
issued and no proceedings for that purpose shall have been commenced or
shall be pending before or contemplated by the Commission and every request
for additional information on the part of the Commission shall have been
complied with in all material respects, and (iii) no stop order suspending
the sale of the Shares in any jurisdiction referred to in Section 5(g)
shall have been issued and no proceeding for that purpose shall have been
commenced or shall be pending or threatened.
(c) No action shall have been taken and no statute, rule, regulation
or order shall have been
38
enacted, adopted or issued by any governmental agency which would, as of
the Closing Date, prevent the issuance of the Shares; and no injunction,
restraining order or order of any nature by a Federal or state court of
competent jurisdiction shall have been issued as of the Closing Date
which would prevent the issuance of the Shares or the consummation of
the Pending Transactions.
(d) (i) Since the date hereof or since the dates as of which
information is given in the Registration Statement and the Prospectus,
there shall not have been any Material Adverse Change, (ii) since the date
of the latest balance sheet included, or incorporated by reference, in the
Registration Statement and the Prospectus, there shall not have been any
material change in the capital stock or long-term debt, or material
increase in short-term debt, of the Company or any of the Subsidiaries
taken as a whole and (iii) the Company and the Subsidiaries taken as a
whole, shall have no liability or obligation, direct or contingent, that is
material to the Company and the Subsidiaries taken as a whole,
respectively, and is required to be disclosed on a balance sheet in
accordance with GAAP and is not disclosed on the latest applicable balance
sheet included in the Registration Statement and the Prospectus.
(e) You shall have received a certificate of the Company, dated the
Closing Date, executed on behalf of the Company, by the President or any
Vice President and a principal financial or accounting officer of the
Company confirming, as of the Closing Date, the matters set forth in
paragraphs (a), (b), (c) and (d) of this Section 8.
(f) On the Closing Date, you shall have received:
(1) an opinion (satisfactory to you and your counsel), dated the
Closing Date, of Xxxxxxx, Head & Xxxxxxx, counsel for the Company (which
opinion shall, in regards to any matters covered by the law of the State of
Florida, rely on the opinion of Florida counsel reasonably acceptable to
the
39
Underwriters, to the effect that:
(i) (A) the Company and each of Citicasters Co.,
an Ohio corporation; EFM Programming, Inc., a Delaware corporation;
Jacor Broadcasting Corporation, an Ohio corporation; Jacor
Broadcasting of Florida, Inc., a Florida corporation; Jacor
Broadcasting of Knoxville, Inc., a Delaware corporation; Jacor
Broadcasting of San Diego, Inc., a Delaware corporation; Jacor
Broadcasting of Sarasota, Inc., a Florida corporation; Jacor
Broadcasting of Tampa Bay, Inc., a Florida corporation; Jacor
Communications Company, a Florida corporation; Noble Broadcasting
Group, Inc., a Delaware corporation; Noble Broadcasting Holdings,
Inc., a Delaware corporation; Noble Broadcasting of St. Louis, Inc., a
Delaware corporation; Regent Broadcasting of Charleston, Inc., a
Delaware corporation; Regent Broadcasting of Kansas City, Inc., a
Delaware corporation; Regent Broadcasting of Las Vegas, Inc., a
Delaware corporation; Regent Broadcasting of Louisville, Inc., a
Delaware corporation; and Regent Broadcasting of Salt Lake City, Inc.,
a Delaware corporation, is a duly organized and validly existing
corporation in good standing under the laws of its jurisdiction of
incorporation, has the requisite corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus, and is
duly qualified as a foreign corporation and in good standing in each
jurisdiction where the ownership, leasing or operation of property or
the conduct of its business requires such qualification, except where
the failure to be so qualified could not be reasonably expected to
have, singly or in the aggregate, a Material Adverse Effect; and (B)
the Company has the requisite corporate power and authority to
execute, deliver and perform this Agreement;
(ii) the Transaction Documents have been duly
authorized, executed and
40
delivered by the Company;
(iii) the authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectus under
"Capitalization" and conforms in all material respects to the
descriptions thereof contained in the Registration Statement and the
Prospectus; (B) the shares of issued and outstanding Common Stock,
have been duly authorized and are validly issued and are fully paid
and nonassessable; (C) the Shares have been duly authorized for
issuance and sale to the Underwriters pursuant to this Agreement and,
when issued and delivered by the Company pursuant to this Agreement
against payment of the consideration set forth herein, will be validly
issued and fully paid and nonassessable; and (D) the issuance of the
Shares is not subject to preemptive or other similar rights;
(iv) all of the issued and outstanding shares of
capital stock of, or other ownership interests in, each Subsidiary
have been duly and validly authorized and issued, and the shares of
capital stock of, or other ownership interests in, each Subsidiary are
owned, directly or through Subsidiaries, by the Company, are fully
paid and nonassessable, and are owned free and clear of any Lien,
except for Liens pursuant to the Credit Facility;
(v) to the knowledge of such counsel (after due
inquiry) there are no outstanding subscriptions, rights, warrants,
options, calls, convertible securities, commitments of sale or Liens
related to or entitling any person to purchase or otherwise to acquire
any shares of the capital stock of, or other ownership interest in,
any Subsidiary except as disclosed in the Prospectus;
(vi) neither the Company nor any of the
Subsidiaries is (A) an "investment company" or a company "controlled"
by an investment company within the meaning of the
41
Investment Company Act of 1940, as amended, or (B) a "holding
company" or a "subsidiary company" of a holding company, or an
"affiliate" thereof within the meaning of the Public Utility
Holding Company Act of 1935, as amended;
(vii) neither the consummation of the transactions
contemplated by this Agreement nor the sale, issuance, execution or
delivery of the Shares, will violate Regulation G, T, U or X of the
Board of Governors of the Federal Reserve System;
(viii) to the best knowledge of such counsel, there
is no current, pending or threatened action, suit or proceeding before
any court or governmental agency, authority or body or any arbitrator
involving the Company or any Subsidiary or to which any of their
respective properties is subject of a character required to be
disclosed in the Registration Statement which is not adequately
disclosed in the Prospectus;
(ix) the descriptions in the Registration Statement
and the Prospectus of statutes, legal and governmental proceedings and
contracts and other documents are accurate in all material respects
and fairly present the information required to be shown; and such
counsel does not know of any legal or governmental proceedings
required to be described in the Registration Statement or Prospectus
which are not described as required or of any contracts or documents
of a character required to be described in the Registration Statement
or Prospectus or to be filed as exhibits to the Registration Statement
which are not described and filed as required; it being understood
that such counsel need express no opinion as to the financial
statements, notes or schedules or other financial data included
therein;
(x) the Registration Statement has become
effective under the Act; any required filing of the Prospectus, and
any
42
supplements and term sheets thereto, pursuant to Rule 424(b) has
been made in the manner and within the time period required by Rule
424(b); and to the knowledge of such counsel (after due inquiry) no
stop order suspending the effectiveness of the Registration Statement
or any part thereof has been issued and no proceedings therefor have
been instituted or are pending or contemplated under the Act;
(xi) no authorization, approval, consent or order
of, or filing with, any court or governmental body or agency is
required for the consummation by the Company of the transactions
contemplated by the Agreement, except such as have been obtained and
made under the Act, the Exchange Act, state securities or "Blue Sky"
laws or regulations or such as may be required by the NASD; no
authorization, approval, consent or order of, or filing with, any
court or governmental body or agency is required for the consummation
by the Company, or Premiere, of the transactions contemplated by the
applicable Transaction Documents, except as disclosed in the
Prospectus; the execution on delivery of this Agreement, the issuance
and sale of the Shares, the performance of this Agreement and the
consummation of the transactions contemplated by this Agreement will
not result in a breach or violation of any of (A) any of the
respective charters or bylaws of the Company or any of the
Subsidiaries or (B) to the knowledge of such counsel (after due
inquiry), the terms or provisions of any agreement or instrument which
is filed as an exhibit to the Registration Statement and to which the
Company or any of the Subsidiaries is a party or by which any of them
is bound, or to which any of the properties of the Company or any of
the Subsidiaries is subject, or (C) to the knowledge of such counsel
(after due inquiry) constitute a default under, any statute, rule or
regulation to which the Company or any Subsidiary is bound or to which
any of the properties of the Company or any Subsidiary is subject or
(D) any order of any court or govern-
43
mental agency or body having jurisdiction over the Company or any
of the Subsidiaries or any of their properties which conflict,
breach or default in each of the cases described in clauses (B),
(C) and (D) could reasonably be expected to have a Material
Adverse Effect;
(xii) at the time it became effective and on the
Closing Date, the Registration Statement complied as to form in all
material respects with the Act;
(xiii) to the knowledge of such counsel, neither the
Company nor the Subsidiaries has received any notice of infringement
of or conflict with asserted rights of others with respect to the
Intellectual Property which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, could
reasonably be expected to result in a Material Adverse Change. The
use of such Intellectual Property in connection with the business and
operations of the Company and the Subsidiaries does not, to the
knowledge of such counsel, infringe on the rights of any person;
(xiv) to the best knowledge of such counsel, (A)
there are no franchises, contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments to which the Company,
any of the Subsidiaries or Premiere are a party or by which any of
them may be bound that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to
the Registration Statement other than those described therein or filed
as exhibits thereto and (B) no default exists in the due performance
or observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan agreement, note,
lease or other instrument so described or filed in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement, or any agreement identified on a schedule
attached to the opinion, except for defaults
44
which could not reasonably be expected to have a Material Adverse
Effect and (c) the statements in the Prospectus under the captions
"Description of Capital Stock" and "Shares Eligible for Future
Sale" insofar as they relate to statements of law or legal
conclusions are accurate in all material respects;
(xv) the Company, the Subsidiaries and Premiere, to
the extent each is a party thereto, have full corporate power and
authority to execute, deliver and perform its respective obligations
under the applicable Transaction Documents;
(xvi) the Transaction Documents, assuming the
authorization, execution and delivery thereof by the parties other
than the Company and Premiere constitute valid and legally binding
agreements of the respective parties thereto enforceable against each
of the parties, to the extent each is a party thereto, in accordance
with their respective terms subject to applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting
creditors' rights generally and to principles of equity (regardless of
whether enforcement is sought in a proceeding at law or equity) and
except to the extent that a waiver of rights under usury laws may be
unenforceable; and
(xvii) the approval of the transactions contemplated
by the Transaction Documents by the shareholders of the Company is not
required.
(2) Such counsel shall additionally state that such counsel has
participated in conferences with officers and other representatives of the
Company, representatives of the independent public accountants for the
Company, your representatives and your counsel in connection with the
preparation of the Registration Statement and Prospectus and has considered
the matters required to be stated therein and the statements contained
therein, although such
45
counsel has not independently verified the accuracy, completeness or
fairness of such statements (except as indicated above); and such
counsel advises you that, on the basis of the foregoing, no facts came
to such counsel's attention that caused such counsel to believe that the
Registration Statement (as amended or supplemented, if applicable), at
the time such Registration Statement or any post-effective amendment
became effective, 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 therein not misleading (other than
information omitted therefrom in reliance on Rule 430A under the Act),
or the Prospectus (as amended or supplemented), as of its date and the
Closing Date, contained an untrue statement of a material fact or
omitted 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. Without limiting the foregoing, such counsel may
further state that the firm assumes no responsibility for, and the firm
has not independently verified, the accuracy, completeness or fairness
of the financial statements, notes and schedules and other financial
data included in the Registration Statement.
(3) An opinion (satisfactory to you and your counsel), dated the
Closing Date of Xxxxx & Xxxxxxx L.L.P., counsel for the Company with
respect to FCC and related matters to the effect that:
(i) those statements in the Prospectus (including
the statements incorporated by reference in the Prospectus, under the
caption "Business -- Federal Regulation of Radio Broadcasting" in the
Company's Form 10-K filed for the year ended December 31, 1996) that
describe provisions of the Communications Act of 1934, as amended (the
"Communications Act"), and the FCC's published rules or regulations
(for purposes of this opinion only, the "Rules") are accurate
descriptions in all material respects.
(ii) Schedule A to this
46
opinion sets forth a complete list of the main station
authorizations issued by the FCC to the Company and its
Subsidiaries (for purposes of this opinion only, the "Licenses").
To such counsel's knowledge, the Licenses are the only licenses,
permits or authorizations required under the Communications Act
for the broadcast of signals on the main station frequency of each
of the radio stations listed on Schedule B (for purposes of this
opinion only, the "Jacor Stations"). Except for the pending
applications noted on Schedule A hereto, the Licenses are in full
force and effect (and the time within which any administrative or
judicial appeal, reconsideration, rehearing or other review might
be sought has lapsed with respect to the grant of the
authorizations for the currently effective terms, and no such
appeal, reconsideration, rehearing, or other review has been taken
or instituted), and are held by the relevant Subsidiary, and the
expiration date of each License is set forth in Schedule A hereto.
Except as indicated on Schedule C to this opinion, the Licenses
are not subject to any conditions imposed by the FCC other than
those that appear on the Licenses or are customarily imposed by
the FCC on radio stations of the same class and type.
(iii) Except as listed in Schedule D hereto, there
is no proceeding or other administrative action pending or, to such
counsel's knowledge, threatened, before the FCC against the Company or
any Subsidiary, which, if adversely determined, would materially and
adversely affect the business or financial condition of the Company
and its Subsidiaries, taken as a whole. To such counsel's knowledge,
except as listed on Schedule E to this opinion, the Company and the
Subsidiaries have filed with the FCC during the current license term
of each License all material reports and forms required to be filed by
the Company and the Subsidiaries with the FCC with respect to the
Jacor Stations.
47
(iv) The execution and delivery by the Company and
any Subsidiary of the Transaction Documents, and the performance of
the obligations as of the date hereof by the Company under the
Underwriting Agreement, (i) do not violate the Communications Act,
(ii) do not violate any of the Rules, (iii) do not violate the terms
of any of the Licenses, (iv) do not cause any forfeiture or impairment
of any License and (v) do not require any consent, approval or
authorization of the FCC that has not been obtained. Except as
indicated on Schedule F, all necessary applications required by the
FCC as of the date hereof for the transfer of control or assignment of
the licenses of the stations described in the Prospectus under
"Pending Radio Station Transactions" have been filed with the FCC.
(g) You shall have received an opinion, dated the Closing Date, of
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP ("Xxxxxxx Xxxx"), counsel for the
Underwriters, in form and substance reasonably satisfactory to you.
(h) You shall have received letters on and as of the date hereof as
well as on and as of the Closing Date (in the latter case constituting an
affirmation of the statements set forth in the former), in form and
substance satisfactory to you, from Coopers & Xxxxxxx L.L.P. and Ernst &
Young LLP, independent public accountants, with respect to the financial
statements and certain financial information contained in the Registration
Statement and the Prospectus for each of (i) the Company and the Combined
E.F.M. Companies and (ii) Premier, respectively.
(i) Xxxxxxx Xxxx shall have been furnished with such documents and
opinions, in addition to those set forth above, as they may reasonably
require for the purpose of enabling them to review or pass upon the matters
referred to in this Section 8 and in order to evidence the accuracy,
completeness or satisfaction in all material respects of any of the
representations, warranties or conditions herein
48
contained.
(j) Prior to the Closing Date, the Company shall have furnished to
you such further information, certificates and documents as you may
reasonably request.
(k) There shall have been no amendments, alterations, modifications,
or waivers of any provisions of the Transaction Documents since the date of
the execution and delivery thereof by the parties thereto other than those
which under the Act are not required to be disclosed in the Prospectus or
any supplement thereto and which have been disclosed to the Underwriters
prior to the date hereof.
(l) Each of the Company, and Premiere, shall, to the extent each is a
party thereto, have complied in all respects with all agreements and
covenants in the Transaction Documents and performed all conditions
specified therein that the terms thereof require to be complied with or
performed at or prior to the date hereof.
(m) Except as is disclosed to the Underwriters in writing, the
representations and warranties of the Company, as applicable, and Premiere
set forth in the Transaction Documents shall be true, accurate and complete
in all respects.
(n) Prior to the Closing Date, the Company shall have obtained the
consents of the Required Lenders (as that term is defined in the Credit
Facility) under the Credit Facility approving the Company's acquisition of
Premiere.
9. DEFAULTS. If on the Closing Date or any Option Closing Date, as
the case may be, any of the Underwriters shall fail or refuse to purchase Firm
Shares or Additional Shares, as the case may be, which it has agreed to purchase
hereunder on such date, and the aggregate amount of Firm Shares or Additional
Shares, as the case may be, that such defaulting Underwriter(s) agreed but
failed or refused to purchase does not exceed 10% of the total number of Shares
to be purchased on such date by all of the Underwriters, each non-defaulting
Under-
49
writer shall be obligated severally, in the proportion which the number of
Firm Shares set forth opposite its name in Schedule I hereto bears to the
total number of Firm Shares which all the non-defaulting Underwriters, as the
case may be, have agreed to purchase, or in such other proportion as you may
specify, to purchase the Firm Shares or Additional Shares, as the case may
be, that such defaulting Underwriter or Underwriters, as the case may be,
agreed but failed or refused to purchase on such date; PROVIDED that in no
event shall the number of Firm Shares or Additional Shares, as the case may
be, that any Underwriter has agreed to purchase pursuant to Section 3 hereof
be increased pursuant to this Section 9 by an amount in excess of one-ninth
of such number of Firm Shares or Additional Shares, as the case may be,
without the written consent of such Underwriter. If, on the Closing Date or
on the Option Closing Date, as the case may be, any of the Underwriters shall
fail or refuse to purchase the Firm Shares or the Additional Shares, as the
case may be, with respect to which such default exceeds 10% of such total
number of the Shares to be purchased on such date by all Underwriter(s) and
arrangements satisfactory to the other Underwriter(s) and the Company for the
purchase of such Shares are not made within 48 hours after such default, this
Agreement shall terminate without liability on the part of the non-defaulting
Underwriter(s) or the Company, except as otherwise provided in this Section
9. In any such case that does not result in termination of this Agreement,
the Underwriters or the Company may postpone the Closing Date or the Option
Closing Date, as the case may be, for not longer than seven (7) days, in
order that the required changes, if any, in the Registration Statement and
the Prospectus or any other documents or arrangements may be effected. Any
action taken under this paragraph shall not relieve a defaulting Underwriter
from liability in respect of any default by any such Underwriter under this
Agreement.
10. EFFECTIVE DATE OF AGREEMENT AND TERMINATION. This Agreement
shall become effective upon the later of (i) the execution and delivery of this
Agreement by the parties hereto, (ii) the effectiveness of the Registration
Statement, and (iii) if a post-effective amendment is required to be filed
pursuant to Rule 430A under the Act, the effectiveness of such post-effective
amendment.
50
This Agreement may be terminated at any time on or prior to the
Closing Date by you by notice to the Company if any of the following has
occurred: (i) subsequent to the date the Registration Statement is declared
effective or the date of this Agreement, any Material Adverse Change occurs
which, in the judgment of any Underwriter, make it impracticable or inadvisable
to market the Shares or to enforce contracts for the sale of the Shares, (ii)
any outbreak or escalation of hostilities or other national or international
calamity or crisis or material adverse change in the financial markets of the
United States or elsewhere, or any other substantial national or international
calamity or emergency if the effect of such outbreak, escalation, calamity,
crisis or emergency would, in the judgment of any Underwriter, make it
impracticable or inadvisable to market the Shares or to enforce contracts for
the sale of the Shares, (iii) any suspension or limitation of trading generally
in securities on the New York Stock Exchange, the American Stock Exchange, the
Nasdaq Stock Market or in the over-the-counter markets or any setting of minimum
prices for trading on such exchanges or markets, (iv) any declaration of a
general banking moratorium by Federal, New York or Ohio authorities, (v) the
taking of any action by any Federal, state or local government or agency in
respect of its monetary or fiscal affairs that in your judgment has a material
adverse effect on the financial markets in the United States, and would, in your
judgment, make it impracticable or inadvisable to market the Shares or to
enforce contracts for the sale of the Shares, (vi) the enactment, publication,
decree, or other promulgation of any Federal or state statute, regulation, rule
or order of any court or other governmental authority which, in your judgment,
materially and adversely affects or will materially and adversely affect the
business or operations of the Company or any Subsidiary, or (vii) any securities
of the Company or any of the Subsidiaries shall have been downgraded or placed
on any "watch list" for possible downgrading by any nationally recognized
statistical rating organization, PROVIDED, that in the case of such "watch list"
placement, termination shall be permitted only if such placement would, in the
judgment of any Underwriter, make it impracticable or inadvisable to market the
Shares or to enforce contracts for the sale of the Shares or material-
51
ly impair the investment quality of the Shares.
The indemnities and contribution provisions and the other agreements,
representations and warranties of the Company, its officers and directors and of
the Underwriters set forth in or made pursuant to this Agreement shall remain
operative and in full force and effect, and will survive delivery of and payment
for the Shares, regardless of (i) any investigation, or statement as to the
results thereof, made by or on behalf of any of the Underwriters or by or on
behalf of the Company, the officers or directors of the Company or any
controlling person of the Company, (ii) acceptance of the Shares and payment for
them hereunder and (iii) termination of this Agreement.
If this Agreement shall be terminated by the Underwriters pursuant to
clauses (i) or (vii) of the second paragraph of this Section 10 or because of
the failure or refusal on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, the Company agrees to reimburse
you for all out-of-pocket expenses (including the fees and disbursements of
counsel) incurred by you. Notwithstanding any termination of this Agreement,
the Company shall be liable for all expenses which it has agreed to pay pursuant
to Section 5(k) hereof.
11. NOTICES. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (a) if to the Company, to it at Jacor
Communications, Inc., 00 Xxxx Xxxxx Xxxxxxxxx, 00xx Xxxxx, Xxxxxxxxx, Xxxxxxxx
00000, Attention: Xxxxx Xxxxxxxx, President, fax (000) 000-0000, with a copy to
Xxxxxxx, Head & Xxxxxxx, 1900 Fifth Third Center, 000 Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxx 00000, Attention: Xxxxxxx X. Xxxxxxxx, Esq., and (b) if to any
Underwriter, to Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation, 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 Attention: Syndicate Department, and, in each
case, with a copy to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP at 000 Xxxxx Xxxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxxx X. Xxxx,
Esq., or in any case to such other address as the person to be notified may have
requested in writing.
52
12. SEVERABILITY. Any determination that any provision of this
Agreement may be, or is, unenforceable shall not affect the enforceability of
the remainder of this Agreement.
13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK AS APPLIED TO
CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW. THE COMPANY, ON BEHALF OF ITSELF AND
ITS SUBSIDIARIES, HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF
THE FEDERAL AND NEW YORK STATE COURTS LOCATED IN THE CITY OF NEW YORK IN
CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING RELATED TO THIS AGREEMENT OR ANY
OF THE MATTERS CONTEMPLATED HEREBY, IRREVOCABLY WAIVES ANY DEFENSE OF LACK OF
PERSONAL JURISDICTION AND IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY
SUIT, ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT. THE
COMPANY, ON BEHALF OF ITSELF AND THE SUBSIDIARIES, IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
14. SUCCESSORS. Except as otherwise provided, this Agreement has
been and is made solely for the benefit of and shall be binding upon the
Company, the Underwriters, any Indemnified Person referred to herein and their
respective successors and assigns, all as and to the extent provided in this
Agreement, and no other person shall acquire or have any right under or by
virtue of this Agreement. The terms "successors and assigns" shall not include
a purchaser of any of the Shares from any of the Underwriters merely because of
such purchase.
15. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in one or more counterpart, the executed
counterparts shall each be deemed to be an original, not all such counterparts
shall together constitute one and the same instrument.
53
16. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to effect the meaning or
interpretation of, this Agreement.
17. SURVIVAL. The indemnities and contribution provisions and the
other agreements, representations and warranties of the Company, its officers
and directors and of the Underwriter set forth in or made pursuant to this
Agreement shall remain operative and in full force and effect, and will survive
delivery of and payment for the Shares, regardless of (i) any investigation, or
statement as to the results thereof, made by or on behalf of the Underwriter or
by or on behalf of the Company, the officers or directors of the Company or any
controlling person of the Company, (ii) acceptance of the Shares and payment for
them hereunder and (iii) termination of this Agreement.
54
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument. Please confirm that the foregoing
correctly sets forth the agreement among the Company and you.
Very truly yours,
JACOR COMMUNICATIONS, INC.
By: /s/ R. Xxxxxxxxxxx Xxxxx
---------------------------
Name: R. Xxxxxxxxxxx Xxxxx
Title: Senior Vice President and
Chief Financial Officer
55
JACOR COMMUNICATIONS COMPANY; BROADCAST
FINANCE, INC.; CINE FILMS, INC.; CINE
GUARANTORS, INC.; CINE GUARANTORS II,
INC.; CINE GUARANTORS II, LTD.; CINE
MOBILE SYSTEMS INT'L N.V.; CINE MOVIL S.A.
DE C.V.; CITICASTERS CO.; EFM PROGRAMMING,
INC.; F.M.I. PENNSYLVANIA, INC.;
GACC-N26LB, INC.; GACC-340, INC.; GEORGIA
NETWORK EQUIPMENT, INC.; GREAT AMERICAN
MERCHANDISING GROUP, INC.; GREAT AMERICAN
TELEVISION PRODUCTIONS, INC.; INMOBILARIA
RADIAL, S.A. DE C.V.*; JACOR BROADCASTING
CORPORATION; JACOR BROADCASTING OF
ATLANTA, INC.; JACOR BROADCASTING OF
COLORADO, INC.; JACOR BROADCASTING OF
FLORIDA, INC.; JACOR BROADCASTING OF
KNOXVILLE, INC.; JACOR BROADCASTING OF ST.
LOUIS, INC.; JACOR BROADCASTING OF SAN
DIEGO, INC.; JACOR BROADCASTING OF
SARASOTA, INC.; JACOR BROADCASTING OF
TAMPA BAY, INC.; JACOR CABLE, INC.;
LOCATION PRODUCTIONS, INC.; LOCATION
PRODUCTIONS II, INC.; NOBLE BROADCAST
CENTER, INC.; NOBLE BROADCAST GROUP, INC.;
NOBLE BROADCAST HOLDINGS, INC.; NOBLE
BROADCAST LICENSES, INC.; NOBLE BROADCAST
OF COLORADO, INC.; NOBLE BROADCAST OF ST.
LOUIS, INC.; NOBLE BROADCAST OF SAN DIEGO,
INC.; NOBLE BROADCAST OF TOLEDO, INC.;
NOBRO, S.C.*; NOVA MARKETING GROUP, INC.;
REGENT BROADCASTING OF CHARLESTON, INC.;
REGENT
56
BROADCASTING OF KANSAS CITY, INC.; REGENT
BROADCASTING OF LAS VEGAS, INC.; REGENT
BROADCASTING OF LAS VEGAS II, INC.; REGENT
BROADCASTING OF LOUISVILLE, INC., REGENT
BROADCASTING OF LOUISVILLE II, INC.;
REGENT BROADCASTING OF SALT LAKE CITY,
INC.; REGENT BROADCASTING OF SALT LAKE
CITY II, INC.; REGENT LICENSEE OF
CHARLESTON, INC.; REGENT LICENSEE OF
KANSAS CITY, INC.; REGENT LICENSEE OF LAS
VEGAS, INC.; REGENT LICENSEE OF LAS VEGAS
II, INC; REGENT LICENSEE OF LOUISVILLE,
INC.; REGENT LICENSEE OF LOUISVILLE II,
INC.; REGENT LICENSEE OF SALT LAKE CITY,
INC.; SPORTS RADIO BROADCASTING, INC.;
SPORTS RADIO, INC.; XXXX-TCI SATELLITE
SERVICES, INC.; THE XX XXXXXXX COMPANY
AGENCY, INC.; WHOK, INC.; AND VTTV
PRODUCTIONS
By: /s/ R. Xxxxxxxxxxx Xxxxx
---------------------------
Name: R. Xxxxxxxxxxx Xxxxx
Title: Senior Vice President
and Assistant Secretary
for all above companies
except those marked
with an *, of which he is
Treasurer
57
The foregoing Underwriting Agreement
is hereby confirmed and accepted
as of the date first above written.
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXXX LYNCH, PIERCE, XXXXXX
& XXXXX INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXX XXXXXX INC.
Acting on behalf of themselves
By: XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By: /s/ Xxxxxx X. Xxxx
---------------------
Name: Xxxxxx X. Xxxx
Title: Senior Vice President
58
SCHEDULE I
Number of
Shares to
Underwriters be Purchased
------------ ------------
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation............ 1,282,000
Credit Suisse First Boston Corporation......................... 1,282,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated............. 1,282,000
Xxxxxx Xxxxxxx & Co. Incorporated.............................. 1,282,000
Xxxxx Xxxxxx Inc. ............................................. 1,282,000
Xxxxxxx Xxxxx & Co. ........................................... 80,000
Xxxxxxxxxx Securities.......................................... 80,000
Genesis Merchant Group Securities ............................. 40,000
Xxxxxx Securities Co. ......................................... 40,000
------------
Total...................................................... 6,650,000
============
59
