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EXHIBIT 1.1
31,000,000 SHARES
CAPSTAR BROADCASTING CORPORATION
CLASS A COMMON STOCK, PAR VALUE $.01 PER SHARE
UNDERWRITING AGREEMENT
May _____, 1998
CREDIT SUISSE FIRST BOSTON CORPORATION
BT ALEX. XXXXX INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
As Representatives of the Several Underwriters
c/o Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory. Capstar Broadcasting Corporation, a Delaware
corporation (the "Company"), proposes to issue and sell (the "U.S. Offering")
to the several Underwriters named in Schedule A hereto (the "Underwriters"),
for which Credit Suisse First Boston Corporation, BT Alex. Xxxxx Incorporated
and Xxxxxx Xxxxxxx & Co. Incorporated are acting as representatives (the
"Representatives"), 24,800,000 shares (the "U.S. Firm Shares") of its Class A
Common Stock, par value $.01 per share (the "Class A Common Stock").
It is understood that the Company is concurrently entering into a
Subscription Agreement, dated the date hereof (the "Subscription Agreement"),
with Credit Suisse First Boston (Europe) Limited ("CSFBL"), BT Alex. Xxxxx
International, Xxxxxx Xxxxxxx & Co. International Limited, and the other
managers named therein (the "Managers") relating to the concurrent offering and
sale of 6,200,000 shares of Class A Common Stock (the "International Firm
Shares") outside the United States and Canada (the "International Offering").
In addition, as set forth below the Company proposes to issue and sell
(i) to the Underwriters, at the option of the Underwriters, an aggregate of not
more than 3,720,000 additional shares of Class A Common Stock ("U.S. Optional
Shares") and (ii) to the Managers, at the option of the Managers, an aggregate
of not more than 930,000 additional shares of Class A Common Stock
("International Optional Shares"). The U.S. Firm Shares and the U.S. Optional
Shares are hereinafter called the "U.S. Shares"; the International Firm Shares
and the International Optional Shares are hereinafter called the "International
Shares"; the U.S. Firm
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Shares and the International Firm Shares are hereinafter called the "Firm
Shares"; the U.S. Optional Shares and the International Optional Shares are
hereinafter called the "Optional Shares". The U.S. Shares and the International
Shares are collectively referred to as the "Offered Shares". To provide for the
coordination of their activities, the Underwriters and the Managers have
entered into an Agreement between U.S. Underwriters and Managers which permits
them, among other things, to sell the Offered Shares to each other for purposes
of resale.
The Company hereby agrees with the several Underwriters as follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333-48819) relating to
the Offered Shares, including a form of prospectus relating to the
U.S. Shares and a form of prospectus relating to the International
Shares being offered in the International Offering has been filed with
the Securities and Exchange Commission (the "Commission") and either
(i) has been declared effective under the Securities Act of 1933, as
amended (the "Securities Act"), and is not proposed to be amended or
(ii) is proposed to be amended by amendment or post-effective
amendment. If such registration statement (the "initial registration
statement") has been declared effective, either (A) an additional
registration statement (the "additional registration statement")
relating to the Offered Shares may have been filed with the Commission
pursuant to Rule 462(b) ("Rule 462(b)") under the Securities Act and,
if so filed, has become effective upon filing pursuant to such Rule
and the Offered Shares all have been duly registered under the
Securities Act pursuant to the initial registration statement and, if
applicable, the additional registration statement or (B) such an
additional registration statement is proposed to be filed with the
Commission pursuant to Rule 462(b) and will become effective upon
filing pursuant to such Rule and upon such filing the Offered Shares
will all have been duly registered under the Securities Act pursuant
to the initial registration statement and such additional registration
statement. If the Company does not propose to amend the initial
registration statement or if an additional registration statement has
been filed and the Company does not propose to amend it, and if any
post-effective amendment to either such registration statement has
been filed with the Commission prior to the execution and delivery of
this Agreement, the most recent amendment (if any) to each such
registration statement has been declared effective by the Commission
or has become effective upon filing pursuant to Rule 462(c) ("Rule
462(c)") under the Securities Act or, in the case of the additional
registration statement, Rule 462(b). For purposes of this Agreement,
"Effective Time" with respect to the initial registration statement
or, if filed prior to the execution and delivery of this Agreement,
the additional registration statement means (i) if the Company has
advised the Representatives that it does not propose to amend such
registration statement, the date and time as of which such
registration statement, or the most recent post-effective amendment
thereto (if any) filed prior to the execution and delivery of this
Agreement, was declared effective by the
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Commission or has become effective upon filing pursuant to Rule
462(c), or (ii) if the Company has advised the Representatives that it
proposes to file an amendment or post-effective amendment to such
registration statement, the date and time as of which such
registration statement, as amended by such amendment or post-
effective amendment, as the case may be, is declared effective by the
Commission. If an additional registration statement has not been filed
prior to the execution and delivery of this Agreement but the Company
has advised the Representatives that it proposes to file one,
"Effective Time" with respect to such additional registration
statement means the date and time as of which such registration
statement is filed and becomes effective pursuant to Rule 462(b).
"Effective Date" with respect to the initial registration statement or
the additional registration statement (if any) means the date of the
Effective Time thereof. The initial registration statement, as amended
at its Effective Time, including all information contained in the
additional registration statement (if any) and deemed to be a part of
the initial registration statement as of the Effective Time of the
additional registration statement pursuant to the General Instructions
of the Form on which it is filed and including all information (if
any) deemed to be a part of the initial registration statement as of
its Effective Time pursuant to Rule 430A(b) ("Rule 430A(b)") under the
Securities Act, is hereinafter referred to as the "Initial
Registration Statement." The additional registration statement, as
amended at its Effective Time, including the contents of the initial
registration statement incorporated by reference therein and including
all information (if any) deemed to be a part of the additional
registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "Additional Registration
Statement". The Initial Registration Statement and the Additional
Registration Statement are hereinafter referred to collectively as the
"Registration Statements" and individually as a "Registration
Statement". The form of prospectus relating to the U.S. Shares and the
form of prospectus relating to the International Shares, each as first
filed with the Commission pursuant to and in accordance with Rule
424(b) ("Rule 424(b)") under the Securities Act or (if no such filing
is required) as included in the Registration Statement, are
hereinafter referred to as the "U.S. Prospectus" and the
"International Prospectus," respectively, and collectively as the
"Prospectuses". No document has been or will be prepared or
distributed in reliance on Rule 434 under the Securities Act.
(b) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement:
(i) on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all respects to the
requirements of the Securities Act and the rules and regulations of
the Commission (the "Rules and Regulations") and did not include 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, (ii) on the Effective Date of the Additional
Registration Statement (if any), each Registration Statement
conformed, or will conform, in all respects to the requirements of the
Securities Act and the Rules and Regulations and did not include, or
will not include, any untrue statement of a material fact and did not
omit, or will not omit, to state any material fact required to be
stated
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therein or necessary to make the statements therein not misleading,
and (iii) on the date of this Agreement, the Initial Registration
Statement and, if the Effective Time of the Additional Registration
Statement is prior to the execution and delivery of this Agreement,
the Additional Registration Statement each conforms, and at the time
of filing of each of the Prospectuses pursuant to Rule 424(b) or (if
no such filing is required) at the Effective Date of the Additional
Registration Statement in which the Prospectuses are included, each
Registration Statement and each of the Prospectuses will conform, in
all respects to the requirements of the Securities Act and the Rules
and Regulations, and none of such documents includes, or will include,
any untrue statement of a material fact or omits, or will omit, to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading. If the Effective Time of
the Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and each of
the Prospectuses will conform in all respects to the requirements of
the Securities Act and the Rules and Regulations, none of such
documents will include any untrue statement of a material fact or will
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and no
Additional Registration Statement has been or will be filed. The two
preceding sentences do not apply to statements in or omissions from a
Registration Statement or either of the Prospectuses based upon
written information furnished to the Company by any Underwriter
through the Representatives or by any Manager through CSFBL
specifically for use therein, it being understood and agreed that the
only such information is that described as such in Section 7(b)
hereof.
(c) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the State of
Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectuses;
and the Company is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in which its
ownership or lease of property or the conduct of its business requires
such qualification, except where the failure to be so qualified would
not have a material adverse effect on the condition (financial or
other), business, properties or results of operations of the Company
and the Subsidiaries (as defined below) taken as a whole ("Material
Adverse Effect").
(d) Each subsidiary of the Company and each subsidiary to
be acquired in the SFX Acquisition (as defined in the Prospectuses)
(collectively, the "Subsidiaries") has been duly incorporated and is
an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectuses; and each Subsidiary is duly qualified to do
business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except where the
failure to be so qualified would not have a Material Adverse Effect;
all of the issued and outstanding capital stock of each Subsidiary has
been duly authorized and validly issued and is fully
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paid and nonassessable; and the capital stock of each Subsidiary,
directly or through subsidiaries, is owned free from liens,
encumbrances and defects, except for liens disclosed in the
Prospectuses.
(e) The Offered Shares and all other outstanding shares
of capital stock of the Company have been duly authorized; all
outstanding shares of capital stock of the Company are, and, when the
Offered Shares have been delivered and paid for in accordance with
this Agreement and the Subscription Agreement on each Closing Date (as
defined below), such Offered Shares will have been, validly issued,
fully paid and nonassessable and will conform to the description
thereof contained in the Prospectuses; the stockholders of the Company
have no preemptive rights with respect to the Class A Common Stock;
and except as described in the Prospectuses, there are no outstanding
options, warrants or other rights calling for the issuance of, or any
commitment, plan or arrangement to issue, any shares of capital stock
of the Company or any security convertible into or exchangeable or
exercisable for any capital stock of the Company.
(f) Except as disclosed in the Prospectuses, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or
any Underwriter or Manager for a brokerage commission, finder's fee or
other like payment in connection with this offering.
(g) Except as disclosed in the Prospectuses, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of the Company owned or to be owned by such person or to
require the Company to include such securities in the securities
registered pursuant to a Registration Statement or in any securities
being registered pursuant to any other registration statement filed by
the Company under the Securities Act.
(h) The Offered Shares have been approved for listing on
the New York Stock Exchange subject to notice of issuance.
(i) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body (including, without
limitation, the Federal Communications Commission (the "FCC")) or any
court is required for the consummation of the transactions
contemplated by this Agreement or the Subscription Agreement in
connection with the issuance and sale of the Offered Shares by the
Company, except such as have been obtained and made under the
Securities Act and such as may be required under state securities
laws.
(j) The execution, delivery and performance of this
Agreement and the Subscription Agreement, and the issuance and sale of
the Offered Shares will not result
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in a breach or violation of any of the terms and provisions of, or
constitute a default under, any statute, any rule, regulation or order
of any governmental agency or body or any court, domestic or foreign,
having jurisdiction over the Company or any Subsidiary or any of their
properties, except for breaches, violations or defaults that would not
individually or in the aggregate have a Material Adverse Effect, or
any agreement or instrument to which the Company or any such
Subsidiary is a party or by which the Company or any such Subsidiary
is bound or to which any of the properties of the Company or any such
Subsidiary is subject, or the charter or by-laws of the Company or any
such Subsidiary, and the Company has full power and authority to
authorize, issue and sell the Offered Shares pursuant to this
Agreement and the Subscription Agreement, respectively.
(k) This Agreement and the Subscription Agreement have
been duly authorized, executed and delivered by the Company.
(l) Except as disclosed in the Prospectuses, the Company
and the Subsidiaries have good and marketable title to all real
properties and all other properties and assets owned by them that are
material to the Company and its Subsidiaries considered as a whole, in
each case free from liens, encumbrances and defects that would
materially affect the value thereof or materially interfere with the
use made or to be made thereof by them; and except as disclosed in the
Prospectuses, the Company and the Subsidiaries hold any such leased
real or personal property under valid and enforceable leases with no
exceptions that would materially interfere with the use made or to be
made thereof by them.
(m) The Company and the Subsidiaries possess adequate
certificates, authorities or permits and hold all necessary licenses
(including without limitation licenses issued by the FCC) issued by
appropriate governmental agencies or bodies necessary to conduct the
business now operated by them, except where the failure to possess
such certificates, authorities or permits or to hold such licenses
would not individually or in the aggregate have a Material Adverse
Effect, and have not received any notice of proceedings relating to
the revocation or modification of any such certificate, authority,
permit or license that, if determined adversely to the Company or any
of the Subsidiaries, would individually or in the aggregate have a
Material Adverse Effect.
(n) No labor dispute with the employees of the Company or
any Subsidiary exists or, to the knowledge of the Company, is imminent
that could reasonably be expected to have a Material Adverse Effect.
(o) The Company and the Subsidiaries own, possess or can
acquire on reasonable terms, adequate trademarks, trade names and
other rights to inventions, know-how, patents, copyrights,
confidential information and other intellectual property
(collectively, "intellectual property rights") necessary to conduct
the business now
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operated by them, or presently employed by them, except where the
failure to own, possess or acquire such intellectual property rights
would not individually or in the aggregate have a Material Adverse
Effect, and have not received any notice of infringement of or
conflict with asserted rights of others with respect to any
intellectual property rights that, if determined adversely to the
Company or any of the Subsidiaries, would individually or in the
aggregate have a Material Adverse Effect.
(p) Each of the Company and the Subsidiaries has filed
all necessary federal, state, local and foreign income and franchise
tax returns, except where the failure to file such returns would not
have a Material Adverse Effect, and each of the Company and the
Subsidiaries has paid all taxes shown as due thereon; and other than
tax deficiencies that the Company or its Subsidiaries is contesting in
good faith and for which adequate reserves have been provided, there
is no tax deficiency that has been asserted against the Company or the
Subsidiaries that would, individually or in the aggregate, have a
Material Adverse Effect.
(q) Except as disclosed in the Prospectuses, neither the
Company nor any of the Subsidiaries is in violation of any statute,
any rule, regulation, decision or order of any governmental agency or
body or any court, domestic or foreign, relating to the use, disposal
or release of hazardous or toxic substances or relating to the
protection or restoration of the environment or human exposure to
hazardous or toxic substances (collectively, "environmental laws"),
owns or operates any real property contaminated with any substance
that is subject to any environmental laws, is liable for any off-site
disposal or contamination pursuant to any environmental laws, or is
subject to any claim relating to any environmental laws, which
violation, contamination, liability or claim would individually or in
the aggregate have a Material Adverse Effect; and the Company is not
aware of any pending investigation which might lead to such a claim.
(r) Except as disclosed in the Prospectuses, there are no
pending actions, suits, proceedings, inquiries or investigations
before or brought by any court or governmental agency or body
(including, without limitation, the FCC) against or affecting the
Company, any of the Subsidiaries or any of their respective properties
that, if determined adversely to the Company or any of the
Subsidiaries, would individually or in the aggregate have a Material
Adverse Effect, or would materially and adversely affect the ability
of the Company to perform its obligations under this Agreement or the
Subscription Agreement, or which are otherwise material in the context
of the sale of the Offered Shares; and no such actions, suits or
proceedings are threatened or, to the Company's knowledge,
contemplated.
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(s) The financial statements included in each
Registration Statement and the Prospectuses present fairly the
financial position of the Company and its consolidated Subsidiaries as
of the dates shown and their results of operations and cash flows for
the periods shown, and, except as otherwise disclosed in the
Prospectuses, such financial statements have been prepared in
conformity with the generally accepted accounting principles in the
United States applied on a consistent basis; the schedules included in
each Registration Statement present fairly the information required to
be stated therein; and the assumptions used in preparing the pro forma
financial statements included in each Registration Statement and the
Prospectuses provide a reasonable basis for presenting the significant
effects directly attributable to the transactions or events described
therein, the related pro forma adjustments give appropriate effect to
those assumptions, and the pro forma columns therein reflect the
proper application of those adjustments to the corresponding
historical financial statement amounts.
(t) Except as disclosed in the Prospectuses, since the
date of the latest audited financial statements included in the
Prospectuses there has been no material adverse change, nor any
development or event involving a prospective material adverse change,
in the condition (financial or other), business, properties or results
of operations of the Company and the Subsidiaries taken as a whole,
and, except as disclosed in or contemplated by the Prospectuses, there
has been no dividend or distribution of any kind declared, paid or
made by the Company on any class of its capital stock.
(u) The statistical and market-related data included in
the Prospectuses are based on or derived from sources that the Company
believes to be accurate and reliable.
(v) Each of the Company and the Subsidiaries (i) makes
and keeps accurate books and records and (ii) maintains internal
accounting controls that provide reasonable assurance that (A)
transactions are executed in accordance with management's
authorization, (B) transactions are recorded as necessary to permit
preparation of its financial statements and to maintain profitability
for its assets, (C) access to its assets is permitted only in
accordance with management's authorization and (D) the reported
accountability for its assets is compared with existing assets at
reasonable intervals.
(w) The Company is not and, after giving effect to the
offering and sale of the Offered Shares and the application of the
proceeds thereof as described in the Prospectuses, will not be an
"investment company" as defined in the Investment Company Act of 1940.
(x) Each of Coopers & Xxxxxxx L.L.P., Xxxxxx Xxxxxxxx LLP
and Ernst & Young LLP, which firms have examined the consolidated
financial statements as set forth in their reports included in the
Prospectuses, is an independent public accounting
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firm within the meaning of the Securities Act and the rules and
regulations promulgated thereunder.
(y) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075 Florida
Statutes, and the Company agrees to comply with such Section if prior
to the completion of the distribution of the Offered Shares it
commences doing such business.
3. Purchase, Sale and Delivery of Offered Shares. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to
purchase from the Company, at a purchase price of U.S.$ per share,
the respective numbers of U.S. Firm Shares set forth opposite the names of the
Underwriters in Schedule A hereto.
The Company will deliver the U.S. Firm Shares to the Representatives
for the accounts of the Underwriters, against payment of the purchase price in
Federal (same day) funds by official bank check or checks or wire transfer to
an account at a bank acceptable to Credit Suisse First Boston Corporation
("CSFBC") drawn to the order of the Company at the office of Weil, Gotshal &
Xxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00 A.M., New York time,
on May __, 1998, or at such other time not later than seven full business days
thereafter as CSFBC and the Company determine, such time being herein referred
to as the "First Closing Date". For purposes of Rule 15c6-1 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), the First
Closing Date (if later than the otherwise applicable settlement date) shall be
the settlement date for payment of funds and delivery of securities for all the
Offered Shares sold pursuant to the U.S. Offering and the International
Offering. The certificates for the U.S. Firm Shares so to be delivered will be
in definitive form, in such denominations and registered in such names as CSFBC
requests and will be made available for checking and packaging at the above
office of Weil, Gotshal & Xxxxxx LLP, at least 24 hours prior to the First
Closing Date.
In addition, upon written notice from CSFBC given to the Company from
time to time not more than 30 days subsequent to the date of the Prospectuses,
the Underwriters may purchase all or less than all of the U.S. Optional Shares
at the purchase price per share of Class A Common Stock to be paid for the U.S.
Firm Shares. The U.S. Optional Shares to be purchased by the Underwriters on
any Optional Closing Date (as defined below) shall be in the same proportion to
all the Optional Shares to be purchased by the Underwriters and the Managers on
such Optional Closing Date as the U.S. Firm Shares bear to all the Firm Shares.
The Company agrees to sell to the Underwriters such U.S. Optional Shares and
the Underwriters agree, severally and not jointly, to purchase such U.S.
Optional Shares. Such U.S. Optional Shares shall be purchased for the account
of each Underwriter in the same proportion as the number of U.S. Firm Shares
set forth opposite such Underwriter's name bears to the total number of shares
of U.S. Firm Shares (subject to adjustment by CSFBC to
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eliminate fractions) and may be purchased by the Underwriters only for the
purpose of covering over-allotments made in connection with the sale of the
U.S. Firm Shares. No Optional Shares shall be sold or delivered unless the U.S.
Firm Shares and the International Firm Shares previously have been, or
simultaneously are, sold and delivered. The right to purchase the Optional
Shares or any portion thereof may be exercised from time to time and to the
extent not previously exercised may be surrendered and terminated at any time
upon notice by CSFBC on behalf of Underwriters and the Managers to the Company.
It is understood that CSFBC is authorized to make payment for and accept
delivery of such Optional Shares on behalf of the Underwriters and Managers
pursuant to the terms of CSFBC's instructions to the Company.
Each time for the delivery of and payment for the U.S. Optional
Shares, being herein referred to as an "Optional Closing Date", which may be
the First Closing Date (the First Closing Date and each Optional Closing Date,
if any, being sometimes referred to as a "Closing Date"), shall be determined
by CSFBC but shall be not later than five full business days after written
notice of election to purchase Optional Shares is given. The Company will
deliver the U.S. Optional Shares being purchased on each Optional Closing Date
to the Representatives for the accounts of the several Underwriters, against
payment of the purchase price therefor in Federal (same day) funds by official
bank check or checks or wire transfer to an account at a bank acceptable to
CSFBC drawn to the order of the Company, at the above office of Weil, Gotshal &
Xxxxxx LLP. The certificates for the U.S. Optional Shares will be in definitive
form, in such denominations and registered in such names as CSFBC requests upon
reasonable notice prior to such Optional Closing Date and will be made
available for checking and packaging at the above office of Weil, Gotshal &
Xxxxxx LLP, at a reasonable time in advance of such Optional Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the U.S. Shares for sale to the public as set
forth in the U.S. Prospectus.
5. Certain Agreements of the Company. The Company agrees with the
several Underwriters that:
(a) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement,
the Company will file each of the Prospectuses with the Commission
pursuant to and in accordance with subparagraph (1) (or, if applicable
and if consented to by CSFBC, subparagraph (4)) of Rule 424(b) not
later than the earlier of (A) the second business day following the
execution and delivery of this Agreement or (B) the fifteenth business
day after the Effective Date of the Initial Registration Statement.
The Company will advise CSFBC promptly of any such filing pursuant to
Rule 424(b). If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement and
an additional registration statement is necessary to register a
portion of the Offered Shares under the Securities Act but the
Effective Time
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thereof has not occurred as of such execution and delivery, the
Company will file the additional registration statement or, if filed,
will file a post-effective amendment thereto with the Commission
pursuant to and in accordance with Rule 462(b) on or prior to 10:00
P.M., New York time, on the date of this Agreement or, if earlier, on
or prior to the time either Prospectus is printed and distributed to
any Underwriter or Manager, or will make such filing at such later
date as shall have been consented to by CSFBC.
(b) The Company will advise CSFBC promptly of any
proposal to amend or supplement the initial or any additional
registration statement as filed or either of the related prospectuses
or the Initial Registration Statement, the Additional Registration
Statement (if any) or either of the Prospectuses and will not effect
such amendment or supplementation without CSFBC's prior consent; and
the Company will also advise CSFBC promptly of the effectiveness of
each Registration Statement (if its Effective Time is subsequent to
the execution and delivery of this Agreement) and of any amendment or
supplementation of a Registration Statement or either of the
Prospectuses and of the institution by the Commission of any stop
order proceedings in respect of a Registration Statement and will use
its best efforts to prevent the issuance of any such stop order and to
obtain as soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the
Offered Shares is required to be delivered under the Securities Act in
connection with sales by any Underwriter, Manager or dealer, any event
occurs as a result of which either or both of the Prospectuses as then
amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary at any time to amend
either or both of the Prospectuses to comply with the Securities Act,
the Company will promptly notify CSFBC of such event and will promptly
prepare and file with the Commission, at its own expense, an amendment
or supplement which will correct such statement or omission or an
amendment which will effect such compliance. Neither CSFBC's consent
to, nor the Underwriters' delivery of, any such amendment or
supplement shall constitute a waiver of any of the conditions set
forth in Section 6.
(d) As soon as practicable, but not later than the
Availability Date (as defined below), the Company will make generally
available to its securityholders an earnings statement covering a
period of at least 12 months beginning after the Effective Date of the
Initial Registration Statement (or, if later, the Effective Date of
the Additional Registration Statement) which will satisfy the
provisions of Section 11(a) of the Securities Act. For the purpose of
the preceding sentence, "Availability Date" means the 45th day after
the end of the fourth fiscal quarter following the fiscal quarter that
includes such Effective Date, except that, if such fourth fiscal
quarter is the last quarter of the Company's fiscal year,
"Availability Date" means the 90th day after the end of such fourth
fiscal quarter.
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(e) The Company will furnish to the Representatives
copies of the Registration Statement (four of which will be signed and
will include all exhibits), each preliminary prospectus relating to
the U.S. Shares, and, so long as a prospectus relating to the Offered
Shares is required to be delivered under the Securities Act in
connection with sales by any Underwriter or dealer, the U.S.
Prospectus and all amendments and supplements to such documents, in
each case in such quantities as CSFBC requests. The U.S. Prospectus
shall be so furnished on or prior to 3:00 P.M., New York time, on the
business day following the later of the execution and delivery of this
Agreement or the Effective Time of the Initial Registration Statement.
All other such documents shall be so furnished as soon as available.
The Company will pay the expenses of printing and distributing to the
Underwriters all such documents.
(f) The Company will arrange for the qualification of the
Offered Shares for sale under the laws of such jurisdictions in the
United States as CSFBC designates and will continue such
qualifications in effect so long as required for the distribution.
(g) During the period of five years hereafter, the
Company will furnish to the Representatives and, upon request, to each
of the other Underwriters, as soon as practicable after the end of
each fiscal year, a copy of its annual report to stockholders for such
year; and the Company will furnish to the Representatives (i) as soon
as available, a copy of each report and any definitive proxy statement
of the Company filed with the Commission under the Exchange Act, or
mailed to stockholders, and (ii) from time to time, such other
information concerning the Company as CSFBC may reasonably request.
(h) The Company will pay all expenses incident to the
performance of its obligations under this Agreement, for any filing
fees and other expenses (including fees and disbursements of counsel)
in connection with qualification of the Offered Shares for sale under
the laws of such jurisdictions in the United States as CSFBC
designates and the printing of memoranda relating thereto, for the
filing fee incidental to, and the reasonable fees and disbursements of
counsel to the Underwriters in connection with, the review by the
National Association of Securities Dealers, Inc. of the Offered
Shares, for any travel expenses of the Company's officers and
employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the
Offered Shares and for expenses incurred in distributing preliminary
prospectuses and the Prospectuses (including any amendments and
supplements thereto) to the Underwriters.
(i) For a period of 180 days after the date of the
initial public offering of the Offered Shares, the Company will not
offer, sell, contract to sell, pledge or otherwise dispose of,
directly or indirectly, or file with the Commission a registration
statement under the Securities Act relating to, any additional shares
of its shares of Class A Common Stock or securities convertible into
or exchangeable or exercisable for any shares of Class A Common Stock,
or publicly disclose the intention to make any
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such offer, sale, pledge, disposition or filing, without the prior
written consent of CSFBC, except (i) pursuant to or in connection with
employee stock option plans, the Warrants or other employee or
non-employee director compensation arrangements or agreements, in each
case, in effect on the date of the Prospectuses; (ii) in connection
with any acquisition by the Company so long as the recipient of such
securities agrees in writing prior to such issuance to be subject to
the foregoing lockup for the remainder of the 180-day lockup period;
(iii) in connection with the conversion of shares of Class B Common
Stock or Class C Common Stock; and (iv) the sale and issuance of
shares of Common Stock to new directors of the Company in connection
with their election or appointment to the board of directors of the
Company.
6. Conditions of the Obligations of the Underwriters.
The obligations of the several Underwriters to purchase and pay for the U.S.
Firm Shares on the First Closing Date and the U.S. Optional Shares to be
purchased on each Optional Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company herein, to the
accuracy of the statements of Company officers made pursuant to the provisions
hereof, to the performance by the Company of its obligations hereunder and to
the following additional conditions precedent:
(a) The Representatives shall have received letters,
dated the date of delivery thereof (which, if the Effective Time of
the Initial Registration Statement is prior to the execution and
delivery of this Agreement, shall be on or prior to the date of this
Agreement or, if the Effective Time of the Initial Registration
Statement is subsequent to the execution and delivery of this
Agreement, shall be prior to the filing of the amendment or
post-effective amendment to the registration statement to be filed
shortly prior to such Effective Time), of Coopers & Xxxxxxx L.L.P.,
Xxxxxx Xxxxxxxx LLP and Ernst & Young LLP (the "Independent
Accountants"), confirming that they are independent public accountants
within the meaning of the Securities Act and the applicable published
Rules and Regulations thereunder and stating to the effect that:
(i) in their opinion the financial statements and
schedules examined by them and included in the Registration
Statements comply as to form in all material respects with the
applicable accounting requirements of the Securities Act and
the related published Rules and Regulations;
(ii) with respect to Coopers & Xxxxxxx, L.L.P. only,
they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of
interim financial information as described in Statement of
Auditing Standards No. 71, Interim Financial Information, on
the unaudited financial statements included in the
Registration Statements;
(iii) with respect to Coopers & Xxxxxxx, L.L.P. only,
on the basis of the review referred to in clause (ii) above, a
reading of the latest available interim financial statements
of the Company, inquiries of officials of the Company who
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have responsibility for financial and accounting matters and
other specified procedures, nothing came to their attention
that caused them to believe that:
(A) the unaudited financial statements
included in the Registration Statements do not comply
as to form in all material respects with the
applicable accounting requirements of the Securities
Act and the related published Rules and Regulations
or any material modifications should be made to such
unaudited financial statements for them to be in
conformity with generally accepted accounting
principles;
(B) at the date of the latest available
balance sheet read by such accountants, or at a
subsequent specified date not more than three
business days prior to the date of this Agreement,
there was any change in the capital stock or any
increase in short-term indebtedness or long-term debt
of the Company and its consolidated subsidiaries or,
at the date of the latest available balance sheet
read by such accountants, there was any decrease in
consolidated net assets, as compared with amounts
shown on the latest balance sheet included in the
Prospectuses; or
(C) for the period from the closing date
of the latest income statement included in the
Prospectuses to the closing date of the latest
available income statement read by such accountants
there were any decreases, as compared with the
corresponding period of the previous year and with
the period of corresponding length ended the date of
the latest income statement included in the
Prospectuses, in consolidated net broadcast revenue,
net income (loss) or in the total or per share
amounts of income (loss) before extraordinary item.
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Registration Statements
(in each case to the extent that such dollar amounts,
percentages and other financial information are derived from
the general accounting records of the Company and its
subsidiaries (or SFX (as defined below) and its subsidiaries)
subject to the internal controls of the Company's (or SFX's)
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from
inquiries, a reading of such general accounting records and
other procedures specified in such letter and have found such
dollar amounts, percentages and other financial information to
be in agreement with such results, except as otherwise
specified in such letter.
For purposes of this subsection, (i) if the Effective Time of the
Initial Registration Statement is subsequent to the execution and
delivery of this Agreement, "Registration Statements" shall mean the
initial registration statement as proposed to be amended by the
amendment or post-effective amendment to be filed shortly prior to its
Effective
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Time, (ii) if the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement but the
Effective Time of the Additional Registration is subsequent to such
execution and delivery, "Registration Statements" shall mean the
Initial Registration Statement and the additional registration
statement as proposed to be filed or as proposed to be amended by the
post-effective amendment to be filed shortly prior to its Effective
Time, and (iii) "Prospectuses" shall mean the prospectuses included in
the Registration Statements.
(b) If the Effective Time of the Initial Registration
Statement is not prior to the execution and delivery of this
Agreement, such Effective Time shall have occurred not later than
10:00 P.M., New York time, on the date of this Agreement or such later
date as shall have been consented to by CSFBC. If the Effective Time
of the Additional Registration Statement (if any) is not prior to the
execution and delivery of this Agreement, such Effective Time shall
have occurred not later than 10:00 P.M., New York time, on the date of
this Agreement or, if earlier, the time either Prospectus is printed
and distributed to any Underwriter or Manager, or shall have occurred
at such later date as shall have been consented to by CSFBC. If the
Effective Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement, each of the Prospectuses
shall have been filed with the Commission in accordance with the Rules
and Regulations and Section 5(a) of this Agreement. Prior to such
Closing Date, no stop order suspending the effectiveness of a
Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or, to the knowledge of the
Company or the Representatives, shall be contemplated by the
Commission.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any
development or event involving a prospective change, in the condition
(financial or other), business, properties or results of operations of
the Company or its subsidiaries which, in the judgment of a majority
in interest of the Underwriters including the Representatives, is
material and adverse and makes it impractical or inadvisable to
proceed with completion of the public offering or the sale of and
payment for the U.S. Shares; (ii) any downgrading in the rating of any
debt securities or preferred stock of the Company by any "nationally
recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Securities Act), or any public announcement
that any such organization has under surveillance or review its rating
of any debt securities or preferred stock of the Company (other than
an announcement with positive implications of a possible upgrading,
and no implication of a possible downgrading, of such rating); (iii)
any suspension or limitation of trading in securities generally on the
New York Stock Exchange, or any setting of minimum prices for trading
on such exchange, or any suspension of trading of any securities of
the Company on any exchange or in the over-the-counter market; (iv)
any banking moratorium declared by U.S. Federal, New York or Delaware
authorities; or (v) any outbreak or escalation of major hostilities in
which the United States is involved, any declaration of war by
Congress or any other
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substantial national or international calamity or emergency if, in the
judgment of a majority in interest of the Underwriters including the
Representatives, the effect of any such outbreak, escalation,
declaration, calamity or emergency makes it impractical or inadvisable
to proceed with completion of the public offering or the sale of and
payment for the U.S. Shares.
(d) The Representatives shall have received an opinion,
dated such Closing Date, of Xxxxxx & Xxxxxx L.L.P., counsel for the
Company, to the effect that:
(i) Each of the Company and Capstar Broadcasting
Partners, Inc., Capstar Radio Broadcasting Partners, Inc.,
Atlantic Star Communications, Inc., Southern Star
Communications, Inc., GulfStar Communications, Inc., Central
Star Communications, Inc., Pacific Star Communications, Inc.,
Xxxxxxxxx Broadcasting, Inc., Benchmark Communications
Holdings Inc. and Capstar Acquisition Company Inc. (together,
the "Significant Subsidiaries") has been duly incorporated or
organized and is an existing corporation or partnership in
good standing under the laws of the state of its incorporation
or organization, with corporate or partnership power and
authority to own its properties and conduct its business as
described in the Prospectuses; and each of the Company and the
Significant Subsidiaries is duly qualified to do business as a
foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification,
except where the failure to be so qualified would not have a
material adverse effect on the condition (financial or other),
business, properties or results of operations of the Company
and the Significant Subsidiaries taken as a whole;
(ii) Except as set forth in the Prospectuses, all of
the outstanding shares of capital stock of, or other ownership
interests in, each of the Significant Subsidiaries have been
duly authorized and validly issued and are fully paid and
non-assessable, and were not issued in violation of any
preemptive rights, rights of first refusal or other similar
rights (in each case created by statute or under any
Significant Subsidiary's certificate of incorporation or
bylaws or any agreement to which any Significant Subsidiary is
a party of which we have knowledge); to such counsel's
knowledge, all such shares are owned by the Company, free and
clear of any security interest, claim, lien, encumbrance or
adverse interest of any nature, except liens set forth in the
Prospectuses;
(iii) The Offered Shares delivered on such Closing Date
and all other outstanding shares of capital stock of the
Company have been duly authorized and validly issued, are
fully paid and nonassessable and conform to the description
thereof contained in the Prospectuses; and the stockholders of
the Company have no preemptive rights, rights of first refusal
or other similar rights (in each case created by statute or
under the Company's certificate of incorporation or bylaws or
any agreement to which the Company is a party of
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which we have knowledge) with respect to the Offered Shares or
the other outstanding shares of capital stock of the Company,
except for those that have been satisfied or waived in writing;
(iv) Except as described in the Prospectuses, to such
counsel's knowledge, there are no outstanding options,
warrants or other rights calling for the issuance of, or any
commitment, plan or arrangement to issue, any shares of
capital stock of the Company or any security convertible into
or exchangeable or exercisable for any capital stock of the
Company;
(v) There are no contracts, agreements or
understandings known to such counsel between the Company and
any person granting such person the right to require the
Company to file a registration statement under the Securities
Act with respect to any securities of the Company owned or to
be owned by such person or to require the Company to include
such securities in the securities registered pursuant to the
Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the
Company under the Securities Act, other than those which have
been satisfied or waived in writing;
(vi) No consent, approval, authorization or order of,
or filing with, any governmental agency or body or any court
is required for the consummation of the transactions
contemplated by this Agreement or the Subscription Agreement
in connection with the issuance or sale of the Offered Shares
by the Company, except such as have been obtained and made
under the Securities Act and such as may be required under
state securities laws;
(vii) The execution, delivery and performance of this
Agreement and the Subscription Agreement and the issuance and
sale of the Offered Shares will not result in a breach or
violation of any of the terms and provisions of, or constitute
a default under, any statute, any rule, regulation or order of
any governmental agency or body or any court having
jurisdiction over the Company or any subsidiary of the Company
or any of their properties, or any agreement or instrument to
which the Company or any such subsidiary is a party or by
which the Company or any such subsidiary is bound or to which
any of the properties of the Company or any such subsidiary is
subject, or the charter or by-laws of the Company or any such
subsidiary, and the Company has full power and authority to
authorize, issue and sell the Offered Shares as contemplated
by this Agreement and the Subscription Agreement,
respectively;
(viii) The Initial Registration Statement was declared
effective under the Securities Act as of the date and time
specified in such opinion, the Additional Registration
Statement (if any) was filed and became effective under the
Securities Act as of the date and time (if determinable)
specified in such
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opinion, each of the Prospectuses either were filed with the
Commission pursuant to the subparagraph of Rule 424(b)
specified in such opinion on the date specified therein or
were included in the Initial Registration Statement or the
Additional Registration Statement (as the case may be), and,
to the best of the knowledge of such counsel, no stop order
suspending the effectiveness of a Registration Statement or
any part thereof has been issued and no proceedings for that
purpose have been instituted or are pending or contemplated
under the Securities Act, and each Registration Statement and
each of the Prospectuses and each amendment or supplement
thereto, as of their respective effective or issue dates,
complied as to form in all material respects with the
requirements of the Securities Act and the Rules and
Regulations; nothing has come to the attention of such counsel
that has caused it to believe that any part of a Registration
Statement or any amendment thereto, as of its effective date
or as of such Closing Date, contained any untrue statement of
a material fact or omitted to state any material fact required
to be stated therein or necessary to make the statements
therein not misleading or that either of the Prospectuses or
any amendment or supplement thereto, as of its issue date or
as of such Closing Date, contained any untrue statement of a
material fact or omitted 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; the
descriptions in the Registration Statements and the
Prospectuses 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 do not know of any legal or
governmental proceedings required to be described in a
Registration Statement or the Prospectuses which are not
described as required or of any contracts or documents of a
character required to be described in a Registration Statement
or the Prospectuses or to be filed as exhibits to a
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 or other financial
data contained in the Registration Statement or the
Prospectuses;
(ix) The Company has all requisite corporate power and
authority to execute and deliver this Agreement and the
Subscription Agreement and to perform its obligations
hereunder and thereunder. This Agreement and the Subscription
Agreement have been duly and validly authorized and executed
by the Company and (assuming the due authorization, execution
and delivery thereof by the Underwriters or the Managers, as
the case may be) constitute the legal, valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except that the enforcement
hereof or thereof may be subject to (i) bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium
or other similar laws affecting creditors' rights and remedies
generally and (ii) general principles of equity and the
discretion of the court before which any proceeding therefor
may be brought (regardless of
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whether enforcement is sought in a proceeding at law or in
equity), and except that the enforceability of rights to
indemnification and contribution hereunder or thereunder may
be limited by federal or state securities laws or regulations
or the public policy underlying such laws or regulations; and
(x) The merger of SBI Radio Acquisition Corporation
with and into SFX Broadcasting, Inc. ("SFX") has become
effective under the laws of the State of Delaware, pursuant to
the terms of the Agreement and Plan of Merger among SBI
Holding Corporation, SBI Radio Acquisition Corporation and
SFX, dated as of August 24, 1997, as amended (the "SFX Merger
Agreement").
In rendering the foregoing opinion, Xxxxxx & Xxxxxx L.L.P. may state
that such opinion does not apply to any FCC matters.
(e) The Representatives shall have received an opinion,
dated such Closing Date, of Wiley, Rein & Fielding, FCC counsel for
the Company, to the effect that:
(i) The issuance and sale of the Offered Shares by
the Company in accordance with this Agreement and the
Subscription Agreement does not require FCC approval assuming
that, in connection therewith, (i) no individual or entity
will acquire an attributable interest (as defined by the FCC)
in the Company that requires any such consent or approval; and
(ii) not more than 25% of the capital stock of the Company
will be owned by alien individuals or entities, or
representatives thereof.
(ii) The execution and delivery by the Company of this
Agreement and the Subscription Agreement and the issuance and
sale of the Offered Shares by the Company in accordance with
this Agreement and the Subscription Agreement does not
constitute a violation by the Company of the Communications
Laws assuming that, in connection therewith: (i) no individual
or entity will acquire an attributable interest (as defined by
the FCC) in the Company that violates the Communications Laws;
and (ii) not more than 25% of the capital stock of the Company
will be owned by alien individuals or entities, or
representatives thereof.
(iii) The entities listed on Exhibit A and on Exhibit B
attached to such opinion (the "Licensees") hold the respective
FCC Licenses listed thereon. Such FCC Licenses are in full
force and effect.
(iv) To the knowledge of such counsel, except for
those disclosed in this Agreement, the Registration Statement
or on Exhibit C attached to such opinion, and except for
proceedings affecting the radio broadcasting industry
generally, there are no proceedings pending or threatened in
writing under the Communications Laws against the Company, the
Licensees or the stations by or
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before the FCC or before any court having jurisdiction of
matters under the Communications Laws which seek the
revocation, non-renewal, or material adverse modification of
any of the FCC Licenses.
(v) The FCC Statements (which include the statements
of the Company in the Registration Statements under the
captions "Risk Factors -- Governmental Regulation of
Broadcasting Industry," "Business -- Federal Regulation of
Radio Broadcasting" and "Business -- Competition; Changes in
Broadcasting Industry"), insofar as they constitute summaries
of the Communications Laws and material proceedings
thereunder, are accurate and fairly present the information
set forth therein in all material respects.
(vi) The FCC has granted its consent (the "FCC
Consent") to the transfer of control of SFX Broadcasting, Inc.
to SBI Holding Corporation. FCC Consent is not subject to any
material adverse conditions imposed by the FCC outside the
ordinary course, except as set forth in the FCC Mass Media
Bureau Memorandum Opinion and Order, DA 98-______, released
_________, 1998. Without limiting the other qualifications set
forth in such opinion, in providing the foregoing opinion such
counsel may assume that all other conditions set forth on the
FCC forms evidencing the FCC Consent, those set forth in the
FCC orders granting the FCC Licenses or any renewal thereof,
those set forth on the FCC forms evidencing the FCC Licenses
or any renewal thereof, and those set forth in the
Communications Laws imposed upon licensees generally or radio
broadcasting licensees specifically, are conditions in the
ordinary course, and such counsel need not express any view on
such matters.
(vii) To such counsel's knowledge, no petition for
reconsideration or review of the FCC Consent has been filed
with the FCC and the FCC has not rescinded or revoked the FCC
Consent or given public notice of review of the FCC Consent on
its own motion.
(f) The Representatives shall have received from Weil,
Gotshal & Xxxxxx LLP, counsel for the Underwriters, such opinion or
opinions, dated such Closing Date, with respect to the incorporation
of the Company, the validity of the Offered Shares delivered on such
Closing Date, the Registration Statements, the Prospectuses and other
related matters as the Representatives may require, and the Company
shall have furnished to such counsel such documents as they request
for the purpose of enabling them to pass upon such matters.
(g) The Representatives shall have received a certificate,
dated such Closing Date, of the President or any Vice President and
the Chief Financial Officer of the Company in which such officers, to
the best of their knowledge after reasonable investigation, shall
state that: the representations and warranties of the Company in this
Agreement are true and correct; the Company has complied in all
material respects with
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all agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to such Closing Date; no
stop order suspending the effectiveness of any Registration Statement
has been issued and no proceedings for that purpose have been
instituted or are contemplated by the Commission; the Additional
Registration Statement (if any) satisfying the requirements of
subparagraphs (1) and (3) of Rule 462(b) was filed pursuant to Rule
462(b), including payment of the applicable filing fee in accordance
with Rule 111(a) or (b) under the Securities Act and Rule 3a, Part 202
-- Informal and Other Procedures under the Securities Act, prior to
the time either Prospectus was printed and distributed to any
Underwriter or Manager; and, subsequent to the date of the most recent
financial statements in the Prospectuses, there has been no material
adverse change, nor any development or event involving a prospective
material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as a whole except as set forth in or contemplated
by the Prospectuses or as described in such certificate.
(h) The Representatives shall have received letters, dated
such Closing Date, of the Independent Accountants which meet the
requirements of subsection (a) of this Section, except that the
specified date referred to in such subsection will be a date not more
than three business days prior to such Closing Date for the purposes
of this subsection.
(i) On such Closing Date, the Managers shall have purchased
the International Firm Shares or the International Optional Shares, as
the case may be, pursuant to the Subscription Agreement.
(j) The merger of SBI Radio Acquisition Corporation with and
into SFX shall have been consummated in accordance with the SFX Merger
Agreement.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
requests. CSFBC may in its sole discretion waive on behalf of the Underwriters
compliance with any conditions to the obligations of the Underwriters
hereunder, whether in respect of an Optional Closing Date or otherwise.
7. Indemnification and Contribution. (a) The Company will indemnify
and hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact contained
in any Registration Statement, either of the Prospectuses, or any amendment or
supplement thereto, or any related preliminary prospectus, or arise out of or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, and will reimburse each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection with
investigating or
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defending any such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that the Company will not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement in or
omission or alleged omission from any of such documents in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
through the Representatives specifically for use therein, it being understood
and agreed that the only information furnished by any Underwriter consists of
the information described as such in subsection (b) below; and, provided
further, that with respect to any untrue statement or alleged untrue statement
in or omission or alleged omission from any preliminary prospectus the
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Underwriter from whom the person asserting any such losses,
claims, damages or liabilities purchased the Offered Securities concerned, to
the extent that a prospectus relating to such Offered Securities was required
to be delivered by such Underwriter under the Securities Act in connection with
such purchase and any such loss, claim, damage or liability of such Underwriter
results from the fact that there was not sent or given to such person, at or
prior to the written confirmation of the sale of such Offered Securities to
such person, a copy of the U.S. Prospectus if the Company had previously
furnished copies thereof to such Underwriter.
(b) Each Underwriter will severally and not jointly indemnify and
hold harmless the Company against any losses, claims, damages or liabilities to
which the Company may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any Registration Statement, either
of the Prospectuses, or any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such
Underwriter through the Representatives specifically for use therein, and will
reimburse any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred, it being understood and
agreed that the only such information furnished by any Underwriter consists of
(i) the following information in the U.S. Prospectus furnished on behalf of
each Underwriter: the last paragraph at the bottom of the cover page concerning
the terms of the offering by the Underwriters, the legend concerning
over-allotments and stabilizing on the inside front cover page, the
over-allotment and stabilization information contained in the last paragraph
under the caption "Underwriting," the concession and reallowance figures
appearing in the fifth paragraph under the caption "Underwriting," and the
information concerning discretionary sales in the sixth paragraph under the
caption "Underwriting"; and (ii) the following information in the U.S.
Prospectus furnished on behalf of BT Alex. Xxxxx Incorporated: the information
contained in the fourteenth paragraph under the caption "Underwriting."
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(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying
party under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a) or (b) above. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section, for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on any
claims that are the subject matter of such action. No indemnified party shall,
without the prior written consent of the indemnifying party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party seeks indemnification pursuant to this Section; provided,
however, that if the indemnifying party does so consent in writing, the
indemnifying party agrees to be liable to the indemnified party under this
Section for any such settlement; and, provided, further, that the indemnified
party may effect a settlement if the settlement is entered into more than
twenty business days after the indemnifying party shall have received a request
from the indemnified party for reimbursement for the fees and expenses of
counsel (in any case where such fees and expenses are the responsibility of the
indemnifying party) and, prior to the date of such settlement, the indemnifying
party shall have failed to comply with such reimbursement request.
(d) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters on the other from the
offering of the U.S. 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 Company on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering of the U.S.
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Shares (before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company or the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The amount paid by an indemnified party as a result of
the losses, claims, damages or liabilities referred to in the first sentence of
this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this subsection (d).
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the U.S. Shares underwritten by it and distributed to the public
were offered to the public 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
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Securities Act; and the
obligations of the Underwriters under this Section shall be in addition to any
liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each director of the Company, to
each officer of the Company who has signed a Registration Statement and to each
person, if any, who controls the Company within the meaning of the Securities
Act.
8. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase U.S. Shares hereunder on either the First
Closing Date or any Optional Closing Date and the aggregate number of shares of
U.S. Shares that such defaulting Underwriter or Underwriters agreed but failed
to purchase does not exceed 10% of the total number of shares of U.S. Shares
that the Underwriters are obligated to purchase on such Closing Date, CSFBC may
make arrangements satisfactory to the Company for the purchase of such U.S.
Shares by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date the non-defaulting Underwriters
shall be obligated severally, in proportion to their respective commitments
hereunder, to purchase the U.S. Shares that such defaulting Underwriters agreed
but failed to purchase on such Closing Date. If any Underwriter or Underwriters
so default and the aggregate number of shares of U.S. Shares with respect to
which such default or defaults occur exceeds 10% of the total number of shares
of constituting the U.S. Shares that the Underwriters are obligated to purchase
on such Closing Date and arrangements satisfactory to CSFBC and the Company for
the purchase of such U.S. Shares by other persons are not made within 36 hours
after such
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default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Company, except as provided in Section 9
(provided that if such default occurs with respect to U.S. Optional Shares
after the First Closing Date, this Agreement will not terminate as to the U.S.
Firm Shares or any U.S. Optional Shares purchased prior to such termination).
As used in this Agreement, the term "Underwriter" includes any person
substituted for an Underwriter under this Section. Nothing herein will relieve
a defaulting Underwriter from liability for its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of
the Company or its officers and of the several Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results thereof, made
by or on behalf of any Underwriter, the Company or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the U.S. Shares. If this Agreement is
terminated pursuant to Section 8 or if for any reason the purchase of the U.S.
Shares by the Underwriters is not consummated, the Company shall remain
responsible for the expenses to be paid or reimbursed by it pursuant to Section
5 and the respective obligations of the Company and the Underwriters pursuant
to Section 7 shall remain in effect and if any U.S. Shares have been purchased
hereunder the representations and warranties in Section 2 and all obligations
under Section 5 shall also remain in effect. If the purchase of the U.S. Shares
by the Underwriters is not consummated for any reason other than solely because
of the termination of this Agreement pursuant to Section 8 or the occurrence of
any event specified in clause (iii), (iv), or (v) of Section 6(c), the Company
will reimburse the Underwriters for all out-of-pocket expenses (including fees
and disbursements of counsel) reasonably incurred by them in connection with
the offering of the U.S. Shares.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and
confirmed to the Representatives, c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue, New York, N.Y. 10010-3629, Attention: Investment Banking
Department - Transactions Advisory Group, or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at 000 Xxxxxxxx Xxxxxx,
Xxxxx 0000, Xxxxxx, Xxxxx 00000, Attention: General Counsel; provided, however,
that any notice to an Underwriter pursuant to Section 7 will be mailed,
delivered or telegraphed and confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 7, and no
other person will have any right or obligation hereunder.
12. Representation of Underwriters. The Representatives will act for
the several Underwriters in connection with this financing, and any action
under this Agreement taken by the Representatives jointly or by CSFBC will be
binding upon all the Underwriters.
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13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
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If the foregoing is in accordance with the Representatives'
understanding of our agreement, kindly sign and return to the Company one of
the counterparts hereof, whereupon it will become a binding agreement between
the Company and the several Underwriters in accordance with its terms.
Very truly yours,
CAPSTAR BROADCASTING CORPORATION
By
--------------------------------
R. Xxxxxx Xxxxx
President and Chief
Executive Officer
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
BT ALEX. XXXXX INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
Acting on behalf of themselves and as the Representatives
of the several Underwriters.
By CREDIT SUISSE FIRST BOSTON CORPORATION
By
------------------------------------
Xxxxxxx Xxxxx
Managing Director
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SCHEDULE A
NUMBER OF
UNDERWRITER U.S. FIRM SHARES
----------- ----------------
Credit Suisse First Boston Corporation . . . . . . . . . . . . . . .
BT Alex. Xxxxx Incorporated . . . . . . . . . . . . . . . . . . . .
Xxxxxx Xxxxxxx & Co. Incorporated . . . . . . . . . . . . . . . . .
Bear, Xxxxxxx & Co. Inc. . . . . . . . . . . . . . . . . . . . . . .
Xxxxxxx, Xxxxx & Co. . . . . . . . . . . . . . . . . . . . . . . . .
NationsBanc Xxxxxxxxxx Securities LLC . . . . . . . . . . . . . . .
Xxxxx Xxxxxx, Inc. . . . . . . . . . . . . . . . . . . . . . . . . .
----------------
TOTAL . . . . . . . . . . . . . . . . . . . 24,800,000
================
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