Exhibit 99.1
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement") is made as of May 26, 2006
by and between Tribune Company, a corporation organized and existing under the
laws of the State of Delaware (the "Company"), and Xxxxxx X. XxXxxxxxx Tribune
Foundation ("Seller").
RECITALS
WHEREAS, the Company intends, but has not yet made any public announcement
of such intention, to conduct a public offer to purchase for up to 53,000,000
shares of its Common Stock, par value $0.01 per share ("Common Stock")
(including the Associated Preferred Share Purchase Rights), through a procedure
commonly called a modified "Dutch Auction" at prices not greater than $32.50 nor
less than $28.00 per share, pursuant to the terms and conditions of an Offer to
Purchase and related Letter of Transmittal, drafts of which have been provided
to Seller (together, the "Offer to Purchase"), as they may be revised amended,
modified or supplemented from time to time after the date hereof (the "Tender
Offer"), which is expected to commence no later than May 31, 2006;
WHEREAS, as of the date hereof, Seller owns of record 36,981,988 shares of
Common Stock, which constitutes approximately 12.2% of the issued and
outstanding shares of Common Stock;
WHEREAS, Seller has determined it will not tender any of its shares of
Common Stock pursuant to the Tender Offer and instead has agreed to sell certain
shares of Common Stock outside of the Tender Offer pursuant to this Agreement;
and
WHEREAS, the Company and Seller desire to make certain covenants and
agreements regarding the Seller's Common Stock with one another pursuant to this
Agreement.
NOW THEREFORE, in consideration of the covenants and promises set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
AGREEMENT
1. Purchase and Sale of the Shares; the Closing.
1.1 Purchase and Sale of Common Stock. Subject to and conditioned upon
the Successful Completion (as defined below) of the Tender Offer and on the
basis of the representations, warranties and covenants set forth herein, Seller
agrees to sell to the Company, and the Company agrees to purchase from Seller,
8,958,200 shares of Common Stock, subject to adjustment as follows; provided,
that in no event shall Seller sell more than 9,854,020 shares of Common Stock
(the "Share Cap") to the Company:
(a) if the Company increases or decreases the number of shares of
Common Stock subject to the Tender Offer (any such increase or decrease, the
"Tender Offer Change"), the aggregate number of shares of Common Stock to be
purchased by the Company from Seller pursuant to this Agreement shall be
increased or decreased, respectively, by an amount equal to the Tender Offer
Change multiplied by a fraction, the numerator of which is 36,981,988 and the
denominator of which is 265,681,856 (representing the outstanding shares of
Common Stock held of record by Seller divided by the outstanding shares of
Common Stock held of record by all stockholders of the Company other than
Seller), subject to the Share Cap; and
(b) if the number of shares of Common Stock tendered and accepted
for purchase in the Tender Offer is less than the number of shares of Common
Stock the Company is offering to purchase in the Tender Offer as of the
expiration date of the Tender Offer (any such difference, the "Shortfall"), the
aggregate number of shares of Common Stock to be purchased by the Company from
Seller shall be increased by an amount equal to the Shortfall, subject to the
Share Cap.
The number of shares of Common Stock to be purchased from Seller by the
Company pursuant to this Section 1.1 is herein referred to as, the "Shares".
1.2 Purchase Price. The "Per Share Purchase Price" for the Shares
shall be equal to the price per share actually paid by the Company for the
shares of Common Stock tendered by the holders of Common Stock in the Tender
Offer. The "Purchase Price" shall equal the Per Share Purchase Price specified
in Section 1.2 multiplied by the number of Shares purchased by the Company from
Seller pursuant to Section 1.1 of this Agreement.
1.3 The Closing. Subject to the terms and conditions hereof, the
purchase and sale of the Shares contemplated by this Agreement (the "Closing")
will take place at the offices of Sidley Austin LLP, Xxx Xxxxx Xxxxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxx 00000 at 10:00 a.m. Chicago time on the eleventh business day
following the expiration or other termination of the Tender Offer (the
"Successful Completion"), or at such other later date or place as the parties
shall mutually agree. At the Closing, (i) Seller will deliver to the Company
certificates representing the Shares to be purchased by the Company duly
endorsed or accompanied by stock powers duly executed in blank and otherwise in
form acceptable for transfer on the books of the Company, and (ii) the Company
shall deliver the Purchase Price to Seller by wire transfer of immediately
available funds to one or more accounts specified by Seller at least one
business day prior to the Closing.
2. Representations and Warranties of Seller. In order to induce the Company
to enter into this Agreement, Seller hereby represents and warrants to the
Company as follows:
2.1 Ownership of Shares. Seller owns of record the number of issued
and outstanding shares of Common Stock set forth in the recitals to this
Agreement. The Shares to be sold to the Company by Seller when delivered to the
Company shall be free and clear of any liens, claims or encumbrances, including
rights of first refusal and similar claims except for restrictions of applicable
state and federal securities laws. There are no restrictions on the transfer of
such Shares imposed by any shareholder or similar agreement or any law,
regulation or order, other than applicable state and federal securities laws.
2.2 Authorization. Seller has full right, power and authority to
execute, deliver and perform this Agreement and to sell, assign and deliver the
Shares to be sold by it to the Company. This Agreement is the
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legal, valid and, assuming due execution and delivery by the other parties
hereto, binding obligation of Seller, enforceable in accordance with its terms,
except to the extent that the enforceability thereof may be limited by (i)
principles of public policy, (ii) applicable bankruptcy, insolvency,
reorganization or other laws of general application relating to or affecting the
enforcement of creditors' rights generally, and (iii) rules of law governing the
availability of equitable remedies.
2.3 No Violation; No Consent. The execution, delivery and performance
of this Agreement and the consummation of the transactions contemplated hereby
by Seller (a) will not constitute a breach or violation of or default under any
judgment, decree or order or any agreement or instrument of Seller or to which
Seller is subject, (b) will not result in the creation or imposition of any lien
upon the Shares to be sold by Seller, and (c) will not require the consent of or
notice to any governmental entity or any party to any contract, agreement or
arrangement with Seller.
2.4 Brokerage. There are no claims for brokerage commissions or
finder's fees or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or agreement made by or
on behalf of Seller.
3. Representations and Warranties of the Company. In order to induce Seller
to enter into this Agreement, the Company hereby represents and warrants as
follows:
3.1 Organization and Corporate Power; Authorization. The Company is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware. The Company has the requisite power and authority
to execute, deliver and perform this Agreement and to acquire the Shares. As of
the Closing, the Company will have sufficient capital to purchase the Shares
hereunder and to purchase the shares of Common Stock to be purchased pursuant to
the Tender Offer in each case in compliance with Section 160 of the Delaware
General Corporation Law. The execution, delivery and performance of this
Agreement and the consummation by the Company of the transactions contemplated
hereby have been approved by a majority of the disinterested directors on the
Board of Directors of the Company, having been advised by counsel, and have been
otherwise duly authorized by all requisite action on the part of the Company.
This Agreement and any other agreements, instruments, or documents entered into
by the Company pursuant to this Agreement have been duly executed and delivered
by the Company and are the legal, valid and, assuming due execution by the other
parties hereto, binding obligations of the Company, enforceable against the
Company in accordance with its terms except to the extent that the
enforceability thereof may be limited by (i) principles of public policy, (ii)
applicable bankruptcy, insolvency, reorganization or other laws of general
application relating to or affecting the enforcement of creditors' rights
generally, and (iii) rules of law governing the availability of equitable
remedies.
3.2 Capital Stock. As of May 15, 2006, the authorized capital stock of
the Company consisted of (i) 1,400,000,000 shares of Common Stock, of which
302,663,844 shares are issued and outstanding (exclusive of 83,441,765 shares
held by subsidiaries or affiliates of the Company), and (ii) 12,000,000 shares
of preferred stock, of which 6,000,000 shares are designated as Series A Junior
Participating Preferred Stock, none of which are issued and outstanding, 823,568
shares are designated as Series C Convertible Preferred Stock, of which 88,519
shares are issued and outstanding, 380,972 shares are designated as Series D-1
Convertible Preferred Stock, of which 76,194 shares are issued and outstanding
and 245,100 shares are designated as Series D-2 Convertible Preferred Stock, of
which 49,020 shares are issued and outstanding.
3.3 No Violation; No Consent. The execution, delivery and performance
of this Agreement and the consummation of the Tender Offer and any other
transactions contemplated by the Tender Offer or hereby by the Company (a) will
not constitute a breach or violation of or default under any judgment, decree or
order or any agreement or instrument of the Company or to which the Company is
subject, and (b) will not require the consent of or prior notice to any
governmental entity or any party to any contract, agreement or arrangement with
the Company, other than the consent of Seller provided in Section 8 hereof.
3.4 Brokerage. There are no claims for brokerage commissions or
finder's fees or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or agreement made by or
on behalf of the Company.
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4. Conditions to the Company's Obligations. The obligations of the Company
under Article 1 of this Agreement to purchase the Shares at the Closing from
Seller are subject to the fulfillment as of the Closing of each of the following
conditions unless waived by the Company in accordance with Section 8.4:
4.1 Representations and Warranties. The representations and warranties
of Seller contained in Article 2 of this Agreement shall be true and correct on
and as of the date of the Closing with the same effect as though such
representations and warranties had been made on and as of the date of the
Closing.
4.2 Consents. The Company shall have obtained all consents or waivers
required under the Credit Facilities (as defined in the Offer to Purchase) as
are necessary to consummate the transactions contemplated hereby.
4.3 Performance. Seller shall have performed and complied in all
material respects with all agreements, obligations, and conditions contained in
this Agreement that are required to be performed or complied with by it on or
before the date of the Closing.
4.4 Tender Offer. The Successful Completion of the Tender Offer shall
have occurred and the number of shares of Common Stock tendered and accepted for
payment in the Tender Offer shall not be less than 30,000,000 shares.
4.5 Delivery of Certificates. Seller shall have delivered all of the
stock certificates representing the Shares to be sold by it at the Closing, free
and clear of any liens, claims or encumbrances, along with all stock powers,
assignments or any other documents, instruments or certificates necessary for a
valid transfer.
4.6 Further Assurances. No governmental authority shall have advised
or notified the Company that the consummation of the transactions contemplated
hereunder would constitute a material violation of any applicable laws or
regulations, which notification or advice shall not have been withdrawn after
the exhaustion of the Company's good faith efforts to cause such withdrawal.
5. Conditions to Seller's Obligations. The obligations of Seller under
Article 1 of this Agreement to sell the Shares at the Closing are subject to the
fulfillment as of the Closing of each of the following conditions unless waived
by Seller in accordance with Section 8.4 of this Agreement:
5.1 Representations and Warranties. The representations and warranties
of the Company contained in Article 3 of this Agreement shall be true and
correct as of the date of the Closing with the same effect as though such
representations and warranties had been made on and as of the date of the
Closing.
5.2 Performance. The Company shall have performed and complied in all
material respects with all agreements, obligations and conditions contained in
this Agreement that are required to be performed or complied with by it on or
before the date of the Closing.
5.3 Payment of Purchase Price. The Company shall have delivered the
Purchase Price to be paid by the Company to Seller by wire transfer to the
account(s) specified by Seller.
5.4 Further Assurances. No governmental authority shall have advised
or notified Seller that the consummation of the transactions contemplated
hereunder would constitute a material violation of any applicable laws or
regulations, which notification or advice shall not have been withdrawn after
the exhaustion of Seller's good faith efforts to cause such withdrawal.
5.5 Minimum Amount of Common Stock Tendered. The number of shares of
Common Stock tendered and accepted for payment in the Tender Offer shall not be
less than 30,000,000 shares.
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6. Covenants.
6.1 No Purchase of Common Stock. Until eleven business days following
the Successful Completion of the Tender Offer, Seller agrees that it will not,
directly or indirectly, purchase any shares of Common Stock.
6.2 No Sale of Common Stock. Except as contemplated hereunder, from
the date hereof until the Closing or the termination of this Agreement, Seller
agrees that it will not, directly or indirectly, sell any shares of Common
Stock, including in the Tender Offer.
6.3 Closing Conditions. Seller and the Company shall use their
commercially reasonable efforts to ensure that each of the conditions to Closing
is satisfied.
7. Survival of Representations and Warranties; Limitation on Liability. All
representations and warranties hereunder shall survive the Closing.
Notwithstanding the foregoing, in no event shall Seller's liability for breach
of the representations, warranties and covenants exceed the Purchase Price to be
paid by the Company to Seller.
8. Miscellaneous.
8.1 Adjustments. Wherever a particular number is specified herein,
including, without limitation, number of shares or price per share, such number
shall be adjusted to reflect any stock dividends, stock-splits, reverse
stock-splits, combinations or other reclassifications of stock or any similar
transactions and appropriate adjustments shall be made with respect to the
relevant provisions of this Agreement so as to fairly and equitably preserve, as
far as practicable, the original rights and obligations of the Company and
Seller under this Agreement.
8.2 Governing Law; Jurisdiction. This Agreement shall be governed by
and construed and enforced in accordance with the internal laws of the State of
Delaware without giving effect to the principles of conflicts of laws. Any legal
action or other legal proceeding relating to this Agreement or the enforcement
of any provision of this Agreement may be brought or otherwise commenced in any
state or federal court located in the State of Delaware. Each party hereto
agrees to the entry of an order to enforce any resolution, settlement, order or
award made pursuant to this Section 8.2 by the state and federal courts located
in the State of Delaware and in connection therewith hereby waives, and agrees
not to assert by way of motion, as a defense, or otherwise, any claim that such
resolution, settlement, order or award is inconsistent with or violative of the
laws or public policy of the laws of the State of Delaware or any other
jurisdiction.
8.3 Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successor and assigns of the parties hereto.
8.4 Entire Agreement; Amendment. This Agreement constitutes the full
and entire understanding and agreement between the parties with regard to the
subject hereof. Neither this Agreement nor any provision hereof may be amended,
changed or waived other than by a written instrument signed by the party against
whom enforcement of any such amendment, change or waiver is sought. For the
avoidance of doubt, to the extent that any of the terms and conditions of this
Agreement are inconsistent with any of the terms and conditions contained in the
most recent draft Offer to Purchase furnished to Seller, the terms of this
Agreement will govern and the Offer to Purchase will be revised to be consistent
with the terms of this Agreement.
8.5 Cooperation. The Company and Seller shall, from and after the date
hereof, cooperate in a reasonable manner to effect the purposes of this
Agreement.
8.6 Termination. The Company or Seller may terminate this Agreement if
(i) the Tender Offer is terminated without the purchase of any shares of Common
Stock or (ii) if the Tender Offer is not consummated by July 28, 2006; provided
that the Company may not terminate this Agreement under this clause (ii) unless
the Tender Offer is terminated. Upon termination of this Agreement pursuant to
this Section 8.6, none of the
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parties hereto shall have any liability hereunder except for breaches of such
party's representations, warranties or covenants occurring prior to the date of
such termination.
8.7 Notices, etc. All notices and other communications required or
permitted hereunder shall be effective upon receipt and shall be in writing and
may be delivered in person, by telecopy, electronic mail, express delivery
service or U.S. mail, in which event it may be mailed by first-class, certified
or registered, postage prepaid, addressed, to the party to be notified, at the
respective addresses set forth below, or at such other address which may
hereinafter be designated in writing:
(a) If to Seller, to:
Xxxxxx X. XxXxxxxxx Tribune Foundation
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000-0000
Attention: President
Phone: 000-000-0000
Fax: 000-000-0000
with a copy to:
Xxxxxxx & Xxxxx LLP
000 Xxxx Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Fax: 000-000-0000
(b) If to the Company, to:
Tribune Company
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Crane X. Xxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
with a copy to:
Sidley Austin LLP
Xxx Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Fax No. 000-000-0000
8.8 Severability. If any provision of this Agreement shall be
judicially determined to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
8.9 Titles and Subtitles. The titles of the Articles and Sections of
this Agreement are for convenience of reference only and in no way define,
limit, extend, or describe the scope of this Agreement or the intent of any of
its provisions.
8.10 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
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8.11 Delays or Omissions. It is agreed that no delay or omission to
exercise any right, power or remedy accruing to any party upon any breach or
default of any other party under this Agreement shall impair any such right,
power or remedy, nor shall it be construed to be a waiver of any such breach or
default, or any acquiescence therein, or of any similar breach or default
thereafter occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter
occurring. It is further agreed that any waiver, permit, consent or approval of
any kind or character of any breach or default under this Agreement, or any
waiver of any provisions or conditions of this Agreement must be in writing and
shall be effective only to the extent specifically set forth in writing, and
that all remedies, either under this Agreement, by law or otherwise, shall be
cumulative and not alternative.
8.12 Consents. Any permission, consent, or approval of any kind or
character under this Agreement shall be in writing and shall be effective only
to the extent specifically set forth in such writing.
8.13 SPECIFIC PERFORMANCE. THE PARTIES HERETO AGREE THAT IRREPARABLE
DAMAGE WOULD OCCUR IN THE EVENT THAT ANY OF THE PROVISIONS OF THIS AGREEMENT
WERE NOT PERFORMED IN ACCORDANCE WITH ITS SPECIFIC INTENT OR WERE OTHERWISE
BREACHED. IT IS ACCORDINGLY AGREED THAT THE PARTIES SHALL BE ENTITLED TO AN
INJUNCTION OR INJUNCTIONS, WITHOUT BOND, TO PREVENT OR CURE BREACHES OF THE
PROVISIONS OF THIS AGREEMENT AND TO ENFORCE SPECIFICALLY THE TERMS AND
PROVISIONS HEREOF, THIS BEING IN ADDITION TO ANY OTHER REMEDY TO WHICH THEY MAY
BE ENTITLED BY LAW OR EQUITY, AND ANY PARTY SUED FOR BREACH OF THIS AGREEMENT
EXPRESSLY WAIVES ANY DEFENSE THAT A REMEDY IN DAMAGES WOULD BE ADEQUATE.
8.14 Payment of Fees and Expenses. Each party shall be responsible for
paying its own fees, costs and expenses in connection with this Agreement and
the transactions herein contemplated.
8.15 Construction of Agreement. No provision of this Agreement shall
be construed against either party as the drafter thereof.
8.16 Section References. Unless otherwise stated, any reference
contained herein to a Section or subsection refers to the provisions of this
Agreement.
8.17 Variations of Pronouns. All pronouns and all variations thereof
shall be deemed to refer to the masculine, feminine, or neuter, singular or
plural, as the context in which they are used may require.
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IN WITNESS WHEREOF, the parties have caused this Stock Purchase Agreement
to be duly executed and delivered by their proper and duly authorized officers
as of the day and year first written above.
TRIBUNE COMPANY
By: /s/ Crane X. Xxxxxx
------------------------------------
Name: Crane X. Xxxxxx
Title: Senior Vice President,
General Counsel and Secretary
XXXXXX X. XxXXXXXXX TRIBUNE FOUNDATION
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
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