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EXHIBIT 10.1
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EXHIBIT 10.1
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SECURITIES PURCHASE AGREEMENT
by and among
XXXXXX COMMUNICATIONS CORPORATION,
THE GUARANTORS
named herein
and
THE INITIAL PURCHASERS NAMED HEREIN
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Dated as of September 22, 1995
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. Accounting Terms; Financial Statements . . . . . . . . . . . . . . . . . 5
ARTICLE II
ISSUE OF NOTES; PURCHASE AND SALE OF NOTES; RIGHTS OF
HOLDERS OF NOTES; OFFERING BY INITIAL PURCHASERS
Section 2.1. Issue of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.2. Purchase, Sale and Delivery of Notes . . . . . . . . . . . . . . . . . . 6
Section 2.3. Registration Rights of Holders of Notes . . . . . . . . . . . . . . . . 7
Section 2.4. Offering by the Initial Purchasers . . . . . . . . . . . . . . . . . . . 7
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF NOTES
Section 3.1. Representations and Warranties of
the Company and the Guarantors . . . . . . . . . . . . . . . . . . . 7
Section 3.2. Resale of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
Section 4.1. Conditions Precedent to Obligations
of the Initial Purchasers . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE V
COVENANTS
Section 5.1. Covenants of the Company and the
Guarantors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
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ARTICLE VI
FEES
Section 6.1 Costs, Expenses and Taxes . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE VII
INDEMNITY
Section 7.1. Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 7.2. Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 7.3. Note Registration Rights Agreement . . . . . . . . . . . . . . . . . . . 30
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Survival of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 8.2. Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 8.3. No Waiver; Modifications in Writing . . . . . . . . . . . . . . . . . . 31
Section 8.4 Information Supplied by the Initial
Purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 8.5. Communications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 8.6. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . 32
Section 8.7. Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 8.8. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 8.9. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . 33
Section 8.10. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SIGNATURE PAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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SCHEDULE I
EXHIBITS
Exhibit 1(a) Form of Opinion of Holland & Knight
Exhibit 1(b) Form of Opinion of Xxxxxxx X. Xxxxxxxx, Esq.
Exhibit 2 Form of Opinion of Dow, Xxxxxx & Xxxxxxxxx
Exhibit 3 Form of Opinion of Xxxxxx Xxxxxx & Xxxxxxx
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SECURITIES PURCHASE AGREEMENT, dated as of September 22, 1995
(the "Agreement"), among XXXXXX COMMUNICATIONS CORPORATION, a Delaware
corporation (the "Company"), the entities listed on the signature pages hereto
(collectively, the "Guarantors"), and WOOD GUNDY INC. and XXXXX XXXXXX INC.
(the "Initial Purchasers").
In consideration of the mutual covenants and agreements set
forth herein and for good and valuable consideration, the receipt of which is
hereby acknowledged, the parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. As used in this Agreement, and
unless the context requires a different meaning, the following terms have the
meanings indicated:
"Accredited Investor" has the meaning provided therefor in
Section 3.2 of this Agreement.
"Acquisition Agreements" means, collectively, those agreements
and other instruments executed by the Company or any of its Subsidiaries in
connection with the Acquisitions (as defined in the Memorandum).
"Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission thereunder.
"Affiliate" means, with respect to any Person, any other
Person which directly or indirectly through one or more intermediaries
controls, or is controlled by, or is under common control with, the Person in
question. For purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under
common control with"), as used with respect to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided, however,
that beneficial ownership of at least 10% of the voting securities of a Person
shall be deemed to be control.
"Agreement" means this Agreement, as the same may be amended,
supplemented or modified in accordance with the terms hereof and in effect.
"Basic Documents" means, collectively, the Indenture, the
Notes, the Guarantees, the Note Registration Rights Agreement and this
Agreement.
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"Business Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which banking institutions in the City of New
York are authorized or obligated by law to close.
"Closing" has the meaning provided therefor in Section 2.2 of
this Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission or
any similar agency then having jurisdiction to enforce the Act.
"Common Stock" means, collectively, the Class A Common Stock,
Class B Common Stock and Class C Common Stock of the Company, each with a par
value of $.001.
"Default" means any event, act or condition which, with notice
or lapse of time or both, would constitute an Event of Default.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"Event of Default" means any event defined as an Event of
Default in the Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.
"FCC" means the United States Federal Communications
Commission.
"Final Memorandum" has the meaning provided therefor in
Section 2.1 of this Agreement.
"Guarantees" has the meaning provided therefor in Section 2.1
of this Agreement.
"Guarantors" means all the current direct and indirect
Subsidiaries of the Company as defined in the introductory paragraph to this
Agreement.
"Indemnified Party" has the meaning provided therefor in
Section 7.1(c) of this Agreement.
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"Indemnifying Party" has the meaning provided therefor in
Section 7.1(c) of this Agreement.
"Indenture" means the indenture dated as of September 28, 1995
among the Company, the Guarantors and The Bank of New York, as Trustee, under
which the Notes will be issued.
"Initial Purchasers" has the meaning provided therefor in the
introductory paragraph of this Agreement.
"Lien" means, with respect to any property or assets of any
Person, any mortgage or deed of trust, pledge, hypothecation, assignment,
deposit arrangement, security interest, lien, charge, easement, encumbrance,
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever on or with respect to such property or assets
(including without limitation, any Capitalized Lease Obligation (as defined in
the Indenture)), conditional sales, or other title retention agreement having
substantially the same economic effect as any of the foregoing.
"Material Adverse Effect" means, with respect to the Company
and its Subsidiaries, a material adverse effect on the business, condition
(financial or otherwise), results of operations or prospects of the Company and
its Subsidiaries, taken as a whole; provided that, with respect to the Company,
"Material Adverse Effect" shall also mean a material adverse effect on the
ability of the Company to perform its obligations under this Agreement or the
Basic Documents or on the ability of the Guarantors, taken as a whole, to
perform their obligations under the Guarantees.
"Memorandum" has the meaning provided therefor in Section 2.1
of this Agreement.
"New Credit Facility" has the meaning provided therefor in the
Indenture.
"Note Registration Rights Agreement" means the registration
rights agreement among the Company, the Guarantors and the Initial Purchasers
relating to the Notes.
"Notes" means the 11 5/8% Senior Subordinated Notes due 2002 of the Company.
"Offering Materials" has the meaning provided therefor in
Section 7.1 of this Agreement.
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"Person" means any individual, corporation, partnership,
trust, incorporated or unincorporated association, joint venture, joint-stock
company, government (or an agency or political subdivision thereof) or other
entity of any kind.
"PORTAL" means the Private Offerings Resales and Trading
through Automated Linkages Market.
"Preliminary Memorandum" has the meaning provided therefor in
Section 2.1 of this Agreement.
"Private Exchange Notes" shall have the meaning provided
thereto in the Note Registration Rights Agreement.
"Proceeding" has the meaning provided therefor in Section
7.1(c) of this Agreement.
"QIB" has the meaning provided therefor in Section 3.2 of this
Agreement.
"State" means each of the states of the United States, the
District of Columbia and the Commonwealth of Puerto Rico.
"State Commission" means any agency of any State having
jurisdiction to enforce such State's securities laws.
"Subsidiaries" means, with respect to any Person, any
corporation, partnership, joint venture, association or other business entity,
whether now existing or hereafter organized or acquired, (i) in the case of a
corporation, of which more than 50% of the total voting power of the capital
stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, officers or trustees thereof is held by such
first-named Person or any of its Subsidiaries; or (ii) in the case of a
partnership, joint venture, association or other business entity, with respect
to which such first-named Person or any of its Subsidiaries has the power to
direct or cause the direction of the management and policies of such entity by
contract or otherwise or if in accordance with generally accepted accounting
principles such entity is consolidated with the first-named Person for
financial statement purposes.
"Taxes" has the meaning provided therefor in Section 3.1(v) of
this Agreement.
"Time of Purchase" has the meaning provided therefor in
Section 2.2 of this Agreement.
"Transactions" has the meaning assigned thereto in the
Memorandum.
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"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended, and the rules and regulations of the Commission thereunder.
Section 1.2. Accounting Terms; Financial Statements. All
accounting terms used herein not expressly defined in this Agreement shall have
the respective meanings given to them in accordance with sound accounting
practice. The term "sound accounting practice" shall mean such accounting
practice as, in the opinion of the independent accountants regularly retained
by the Company, conforms at the time to generally accepted accounting
principles in the United States applied on a consistent basis except for
changes with which such accountants concur. All determinations to which
accounting principles apply shall be made in accordance with sound accounting
practice.
ARTICLE II
ISSUE OF NOTES; PURCHASE AND SALE
OF NOTES; RIGHTS OF HOLDERS OF NOTES;
OFFERING BY INITIAL PURCHASERS
Section 2.1. Issue of Notes. The Company has authorized the
issuance of $230,000,000 aggregate principal amount of the Notes which are to
be issued pursuant to the Indenture. Each Note will be substantially in the
form of the Note set forth as Exhibit A to the Indenture. The Notes will be
unconditionally guaranteed by the Guarantors pursuant to the terms of the
Indenture (the "Guarantees").
The Notes will be offered and sold to the Initial Purchasers
without being registered under the Act, in reliance on exemptions therefrom.
In connection with the sale of the Notes, the Company and the
Guarantors have prepared a preliminary offering memorandum dated August 30,
1995 (the "Preliminary Memorandum") and prepared a final offering memorandum
dated September 21, 1995 (the "Final Memorandum" and, together with the
Preliminary Memorandum, the "Memorandum") setting forth or including a
description of the terms of the Notes, the terms of the offering, a description
of the Company and the Guarantors and any material developments relating to the
Company and the Guarantors occurring after the date of the most recent
financial statements included therein.
Section 2.2. Purchase, Sale and Delivery of Notes. On the
basis of the representations, warranties, agreements and covenants herein
contained and subject to the terms and conditions herein set forth, the Company
agrees that it will sell to each Initial Purchaser, and each Initial Purchaser
agrees, acting severally and not jointly, that it will purchase from the
Company at the Time of Purchase, the principal amount of the Notes set forth
opposite the name of such Initial Purchaser on Schedule I hereto at a price of
$958.65 per Note.
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The purchase, sale and delivery of the Notes will take place
at a closing (the "Closing") at the offices of Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00 A.M., New York time, on September 28,
1995, or such later date and time, if any, as the Initial Purchasers and the
Company shall agree. The time at which such Closing is concluded is herein
called the "Time of Purchase."
One or more certificates in definitive form for the Notes that
the Initial Purchasers have agreed to purchase hereunder, and in such
denomination or denominations and registered in such name or names as the
Initial Purchasers request upon notice to the Company at least 24 hours prior
to the Closing, shall be delivered by or on behalf of the Company to the
Initial Purchasers, against payment by or on behalf of the Initial Purchasers
of the purchase price therefor by certified or official bank check or checks
drawn on or by a New York Clearing House bank and payable in next day funds;
provided that at the request of the Company such payment will be made by wire
transfer of immediately available funds wired in accordance with the written
instructions of the Company, in which case the Company shall reimburse the
Initial Purchasers for any actual out-of-pocket costs for obtaining such funds.
The Company will make such certificate or certificates for the Notes available
for checking and packaging by the Initial Purchasers at the offices of CIBC
Wood Gundy Securities Corp., or such other place as CIBC Wood Gundy Securities
Corp. may designate, at least 24 hours prior to the Closing.
Section 2.3. Registration Rights of Holders of Notes. The
Initial Purchasers and their direct and indirect transferees of the Notes will
have such rights with respect to the registration thereof under the Act and
qualification of the Indenture under the Trust Indenture Act as are set forth
in the Note Registration Rights Agreement.
Section 2.4. Offering by the Initial Purchasers. The Initial
Purchasers propose to make an offering of the Notes at the price and upon the
terms set forth in the Final Memorandum, as soon as practicable after this
Agreement is entered into and as in the judgment of the Initial Purchasers is
advisable.
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF NOTES
Section 3.1. Representations and Warranties of the Company
and the Guarantors. The Company and the Guarantors, jointly and severally,
represent and warrant to and agree with each of the Initial Purchasers as
follows:
(a) The Final Memorandum, except as to the information
contained in the Final Memorandum under the caption "Pro Forma and
Projected Financial Data," which the Company and the Guarantors make
only such representations as are set forth under such caption, as of
its date and at the Time of Purchase, will not
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contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading,
except that the representations and warranties set forth in this
Section 3.1(a) do not apply to statements or omissions made in
reliance upon and in conformity with information relating to the
Initial Purchasers furnished to the Company or the Guarantors in
writing by the Initial Purchasers expressly for use in the Final
Memorandum or any amendment or supplement thereto.
(b) The consolidated financial statements of the Company and
its Subsidiaries together with related notes and schedules, set forth
in the Final Memorandum fairly present the financial condition of the
Company and its Subsidiaries as of the dates indicated and the results
of operations and changes in financial position for the periods
therein specified in conformity with generally accepted accounting
principles consistently applied throughout the periods involved
(except as otherwise stated therein), except that the unaudited
interim financial statements are subject to normal year-end
adjustments; and the pro forma financial statements and the related
notes thereto included in the Final Memorandum have been prepared
using reasonable assumptions and in accordance with the applicable
requirements of the Act and include all adjustments necessary to
present fairly the pro forma financial information included within the
Final Memorandum at the respective dates and for the respective
periods indicated. Each of Price Waterhouse LLP and Ryals, Brimmer,
Xxxxx and Xxxxxx, each of which is reporting upon certain of the
audited financial statements and schedules included in each
Memorandum, is an independent public accounting firm as required by
the Act and the rules and regulations thereunder.
(c) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware
and has filed all reports with the Secretary of State of Delaware
required to obtain a certificate of existence from that office. Each
Subsidiary is either (i) a corporation duly incorporated or organized,
validly existing and in good standing under the laws of the state or
other jurisdiction of its incorporation or organization or (ii) a
partnership duly organized and validly existing under the applicable
laws of the State of Florida. Each of the Company and the
Subsidiaries is duly qualified and in good standing as a foreign
corporation or partnership, and is authorized to do business, in each
jurisdiction in which the ownership or leasing of any property or the
character of its operations makes such qualification necessary and in
which the failure so to qualify could have a Material Adverse Effect.
(d) As of the Time of Purchase (after giving pro forma effect
to the incurrence of indebtedness under the New Credit Facility and
the retirement of the Existing Senior Indebtedness (as defined in the
Memorandum)), the Company will
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have the authorized, issued and outstanding capitalization as set
forth in the Final Memorandum. All of the issued and outstanding
shares of capital stock of the Company and its Subsidiaries are
validly issued, fully paid and nonassessable and were not issued in
violation of any preemptive or similar rights. The Company has no
Subsidiaries other than the Guarantors. Except as set forth in the
Final Memorandum, (i) all of the capital stock of the Guarantors is
owned directly or indirectly by the Company, free and clear of any
Liens, (ii) there are no outstanding subscriptions, options, warrants,
rights, convertible securities or other binding agreements or
commitments of any character obligating the Company or its
Subsidiaries to issue any securities and (iii) there is no agreement,
understanding or arrangement among the Company or its Subsidiaries and
their respective stockholders or any other Person relating to the
ownership or disposition of any capital stock in the Company or any
Subsidiary, the election of directors of the Company or any of its
Subsidiaries or the governance of the Company's or any Subsidiary's
affairs, and such agreements, arrangements or understandings will not
be breached or violated as a result of the execution and delivery of,
or the consummation of the transactions contemplated by, this
Agreement, the Basic Documents and the Transactions.
(e) This Agreement has been duly authorized by the Company
and the Guarantors and when executed and delivered by the Company and
the Guarantors (assuming the due authorization, execution and delivery
by the Initial Purchasers), will constitute a valid and legally
binding agreement of the Company and the Guarantors, enforceable
against each of them in accordance with its terms except (i) that the
enforcement hereof may be subject to bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights
generally, and to general principles of equity and the discretion of
the court before which any proceeding therefor may be brought and (ii)
as any rights to indemnity or contribution hereunder may be limited by
federal and state securities laws and public policy considerations.
(f) The Indenture has been duly authorized by the Company and
the Guarantors and when executed and delivered by the Company and the
Guarantors (assuming the due authorization, execution and delivery by
the Trustee), will constitute a valid and legally binding agreement of
the Company and the Guarantors, enforceable against each of them in
accordance with its terms except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally, and (ii) general
principles of equity and the discretion of the court before which any
proceeding therefor may be brought.
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(g) The Note Registration Rights Agreement has been duly
authorized by the Company and the Guarantors and when executed and
delivered by the Company and the Guarantors (assuming the due
authorization, execution and delivery by the Initial Purchasers) will
constitute a valid and legally binding agreement of the Company and
the Guarantors, enforceable against each of them in accordance with
its terms except (i) that the enforcement thereof may be subject to
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws now or hereafter in effect relating
to creditors' rights generally, and to general principles of equity
and the discretion of the court before which any proceeding therefor
may be brought and (ii) as any rights to indemnity or contribution
thereunder may be limited by federal and state securities laws and
public policy considerations.
(h) The Notes have each been duly authorized by the Company
and, when the Notes are executed by the Company and authenticated by
the Trustee in accordance with the provisions of the Indenture and
delivered to and paid for by the Initial Purchasers in accordance with
the terms of this Agreement, the Notes will be entitled to the
benefits of the Indenture and will constitute valid and legally
binding obligations of the Company enforceable in accordance with
their terms, except that the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws now or hereafter in effect relating
to creditors' rights generally, and (ii) general principles of equity
and the discretion of the court before which any proceeding therefor
may be brought.
(i) The Guarantees endorsed on the Notes have each been duly
authorized by each of the Guarantors and, when the Notes are executed
by the Company and authenticated by the Trustee in accordance with the
provisions of the Indenture and delivered to and paid for by the
Initial Purchasers in accordance with the terms of this Agreement, the
Guarantees will be entitled to the benefits of the Indenture and will
constitute valid and legally binding obligations of the Guarantors
enforceable in accordance with their terms, except that the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights
generally, and (ii) general principles of equity and the discretion of
the court before which any proceeding therefor may be brought.
(j) Immediately after the consummation of the transactions
contemplated by this Agreement (including the use of proceeds from the
sale of Notes at the Time of Purchase), the fair value and present
fair saleable value of the assets of the Company (on a consolidated
basis) will exceed the sum of its stated liabilities and identified
contingent liabilities; the Company (on a consolidated basis) will not
be, after giving effect to the execution, delivery and performance of
this Agreement
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and the consummation of the transactions contemplated hereby
(including the use of proceeds from the sale of Notes at the Time of
Purchase), (i) left with unreasonably small capital with which to
carry on its business as it is proposed to be conducted, (ii) unable
to pay its debts (contingent or otherwise) as they mature or (iii)
otherwise insolvent.
(k) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under this
Agreement and to consummate each of the other Transactions. Each of
the Company and the Guarantors (to the extent a party thereto) has all
requisite corporate power and authority to (i) execute, deliver and
perform its obligations under this Agreement and each of the Basic
Documents, (ii) execute, deliver and perform its obligations under all
other agreements and instruments executed and delivered by the Company
pursuant to or in connection with this Agreement, each of the Basic
Documents and the Transactions and (iii) issue the Notes and the
Guarantees, as the case may be, in the manner and for the purpose
contemplated by this Agreement.
(l) Subsequent to the date as of which information is given
in the Final Memorandum there has not been (i) any event or condition
that has had or that could reasonably be expected to have a Material
Adverse Effect, (ii) any transaction entered into by the Company or
any Subsidiary, other than in the ordinary course of business, that is
material to the Company and its Subsidiaries, taken as a whole, or
(iii) any dividend or distribution of any kind declared, paid or made
by the Company on its Common Stock.
(m) Except as set forth in the Final Memorandum or with
respect to certain pending acquisitions, there is no action, suit,
investigation or proceeding, governmental or otherwise, pending or, to
the best knowledge of the Company, threatened to which the Company or
any of its Subsidiaries is or would be a party or of which the
properties of the Company or its Subsidiaries are or may be subject,
that (i) seeks to restrain, enjoin, prevent the consummation of or
otherwise challenge the issuance and sale of the Notes by the Company
or any of the other transactions contemplated hereby, (ii) questions
the legality or validity of any such transactions or seeks to recover
damages or obtain other relief in connection with any such
transactions or (iii) could reasonably be expected to have a Material
Adverse Effect.
(n) The execution, delivery and performance by the Company
and the Guarantors (to the extent a party thereto) of this Agreement
and the Basic Documents, and the issuance and sale by the Company of
the Notes, the making of the Guarantees by the Guarantors, and the
execution, delivery and performance by the Company and each of the
Guarantors (to the extent each is a party thereto) of all other
agreements and instruments to be executed and delivered by the Company
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and the Guarantors, pursuant hereto or thereto or in connection
herewith or therewith or in connection with any of the other
Transactions, and compliance by the Company and the Guarantors (to the
extent a party thereto) with the terms and provisions hereof and
thereof, do not and will not (i) violate any provision of any law,
rule or regulation (including, without limitation, Regulation G, T, U
or X of the Board of Governors of the Federal Reserve System), order,
writ, judgment, decree, determination or award presently in effect or
in effect at the Time of Purchase having applicability to the Company
or any of its Subsidiaries, (ii) conflict with or result in a breach
of or constitute a default under the certificate of incorporation or
by-laws of the Company or any of the Subsidiaries, or, as of the Time
of Purchase, any indenture or loan or credit agreement, or any other
material agreement or instrument, to which the Company or any of its
Subsidiaries is a party or by which the Company or any of the
Subsidiaries or any of their respective properties may be bound or
affected, or (iii) except as contemplated by this Agreement and the
Basic Documents, result in, or require the creation or imposition of,
any Lien upon or with respect to any of the properties now owned or
hereafter acquired by the Company or any of the Subsidiaries, except,
in each case, where such violation, conflict, default or creation or
imposition of any Lien would not (individually or in the aggregate)
have a Material Adverse Effect.
(o) Each agreement or instrument executed and delivered by
the Company or the Guarantors (to the extent a party thereto) in
connection with this Agreement, the Basic Documents or the
Transactions has been duly and validly authorized, executed and
delivered by the Company and the Guarantors (to the extent a party
thereto) and constitutes or will constitute a valid and legally
binding obligation of the Company and the Guarantors (to the extent a
party thereto), enforceable against them in accordance with its terms,
except (i) that the enforcement thereof may be subject to bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally, and to general principles of equity and the discretion of
the court before which any proceeding therefor may be brought and (ii)
as any rights to indemnity and contribution hereunder and thereunder
may be limited by applicable law.
(p) Neither the Company nor any of the Subsidiaries is
currently or, after giving effect to the consummation of the
transactions contemplated by this Agreement and the other
Transactions, will be, (i) in violation of its respective certificate
of incorporation or by-laws, (ii) in default (nor will an event occur
which with notice or passage of time or both would constitute such a
default) under or in violation of any indenture or loan or credit
agreement or any other material agreement or instrument to which it is
a party or by which it or any of its properties may be bound or
affected (except as set forth in the Final Memorandum), (iii) in
violation of any order of any court, arbitrator or
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governmental body or subject to or party to any order of any court or
governmental authority arising out of any action, suit or proceeding
under any statute or other law respecting antitrust, monopoly,
restraint of trade, unfair competition or similar matters, or (iv) in
violation of or will have violated any such statute, rule or
regulation of any governmental authority, which default or violation
(individually or in the aggregate) could reasonably be expected to (y)
affect the legality, validity or enforceability of this Agreement or
any of the Basic Documents or (z) have a Material Adverse Effect.
(q) Except as set forth in the Final Memorandum, no
authorization, consent, approval, license, qualification or formal
exemption from, nor any filing, declaration or registration with, any
court, governmental agency or regulatory authority or any securities
exchange is required in connection with the execution, delivery or
performance by the Company or any of the Subsidiaries (to the extent
they are a party thereto) of this Agreement, any of the Basic
Documents or any of the Transactions, except (i) as may be required
under state securities or "blue sky" laws or the laws of any foreign
jurisdiction in connection with the offer and sale of the Notes or
(ii) as would not (individually or in the aggregate) have a Material
Adverse Effect. All such authorizations, consents, approvals,
licenses, qualifications, exemptions, filings, declarations and
registrations set forth in the Final Memorandum (other than as
disclosed therein) which are required to have been obtained by the
date hereof have been obtained or made, as the case may be, and are in
full force and effect and not the subject of any pending or, to the
knowledge of the Company, threatened attack by appeal or direct
proceeding or otherwise.
(r) The Company is not and immediately after the Time of
Purchase will not be an "investment company" or a company "controlled"
by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
(s) The execution and delivery of this Agreement and and the
other Basic Documents and the sale of the Notes to the Initial
Purchasers will not involve any non-exempt prohibited transaction
within the meaning of Section 406 of ERISA, or Section 4975 of the
Code on the part of the Company or any of its Subsidiaries. No
Reportable Event (as defined in ERISA) has occurred during the
five-year period prior to the date on which this representation is
made or deemed made with respect to any Employee Benefit Plan (as
defined in ERISA), and each Employee Benefit Plan has complied in all
material respects with the applicable provisions of ERISA and the
Code. The present value of all benefits vested under each Employee
Benefit Plan maintained by the Company or any Commonly Controlled
Entity (as defined in ERISA) (based on the current liability, interest
rate and other assumptions used in preparation of the plan's Form 5500
Annual Report) did not,
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as of the last annual valuation date prior to the date on which this
representation is made or deemed made, exceed the value of the assets
of such plan allocable to such accrued benefits. Neither the Company
nor any Commonly Controlled Entity has had a complete or partial
withdrawal from any Multiemployer Plan (as defined in ERISA), and
neither the Company nor any Commonly Controlled Entity would become
subject to any liability under ERISA if the Company or any such
Commonly Controlled Entity were to withdraw completely from all
Multiemployer Plans as of the valuation date most closely preceding
the date on which such representation is made or deemed made. No such
Multiemployer Plan is in reorganization or insolvent. There are no
material liabilities of the Company or any Commonly Controlled Entity
for post-retirement benefits to be provided to their current and
former employees under Plans which are welfare benefit plans (as
described in Section 3(1) of ERISA).
(t) Other than assets to be acquired in connection with the
Acquisitions, the Company and each of its Subsidiaries have good and
valid title to, or valid and enforceable leasehold interests, in, all
properties and assets identified in the Memorandum as owned or leased
by each of them which are material to the business of the Company and
its Subsidiaries, taken as a whole, free and clear of all Liens,
except (i) such Liens as are described in the Final Memorandum or (ii)
Liens created in the ordinary course of business which are Permitted
Liens (as defined in the Indenture). All of the leases material to
the business of the Company and the Subsidiaries, taken as a whole,
and under which the Company or any Subsidiary holds properties
described in the Final Memorandum, are valid and binding as leased by
them, with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such properties by the
Company and its Subsidiaries.
(u) No form of general solicitation or general advertising
was used by the Company or its representatives in connection with the
offer and sale of the Notes. Neither the Company nor any Person
authorized to act for it has, either directly or indirectly, sold or
offered for sale any of the Notes or any other similar security of the
Company to, or solicited any offers to buy any thereof from, or has
otherwise approached or negotiated in respect thereof with, any Person
or Persons other than with or through the Initial Purchasers; and the
Company agrees that neither it nor any Person acting on its behalf
will sell or offer for sale any Notes to, or solicit any offers to buy
any Notes from, or otherwise approach or negotiate in respect thereof
with, any Person or Persons so as thereby to bring the issuance or
sale of any of the Notes within the provisions of Section 5 of the
Act.
(v) All tax returns required to be filed by the Company or
any of its Subsidiaries in any jurisdiction (including foreign
jurisdictions) have been so filed and all taxes, assessments, fees and
other charges including, without limitation,
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withholding taxes, penalties, and interest ("Taxes") due or claimed to
be due have been paid, other than those Taxes being contested in good
faith and those Taxes for which adequate reserves or accruals have
been established in accordance with generally accepted accounting
principles, except where the failure to file such returns or to pay
such Taxes is not reasonably likely to have, singly or in the
aggregate, a Material Adverse Effect. The Company knows of no actual
or proposed additional tax assessments for any fiscal period against
the Company or any of the Subsidiaries that, individually or in the
aggregate, is reasonably likely to have a Material Adverse Effect.
(w) The Company and its Subsidiaries are the sole and
exclusive owners or licensees of all trade names, unregistered
trademarks and service marks, brand names, patents, registered and
unregistered copyrights, registered trademarks and service marks, and
all applications for any of the foregoing, and all permits, grants and
licenses or other rights with respect thereto, the absence of which
would have or could reasonably be expected to have a Material Adverse
Effect. Except as set forth in the Final Memorandum neither the
Company nor any of its Subsidiaries has been charged with any material
infringement of any intangible property of the character described
above or been notified or advised of any material claim of any other
Person relating to any of the intangible property which infringements
or claims (individually or in the aggregate) would have a Material
Adverse Effect.
(x) Except as set forth in the Final Memorandum, the Company
and its Subsidiaries comply with all laws, rules and regulations
(including, without limitation, all applicable environmental laws,
rules and regulations) applicable to the Company and each such
Subsidiary, and the Company and its Subsidiaries own or possess and
are operating in compliance in all material respects with the terms,
provisions, conditions, restrictions and limitations contained in all
licenses, franchises, approvals, certificates and permits (including,
without limitation, environmental permits) from all Federal, state,
territorial, foreign and local governmental and regulatory authorities
which are necessary to own or lease their respective properties and
assets and to the conduct of their respective businesses (other than
such laws, rules, regulations, licenses, franchises, approvals,
certificates or permits that are immaterial in scope or application to
the Company and its Subsidiaries, taken as a whole), including,
without limitation, licenses, franchises and approvals from the FCC
except where the failure to so comply, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse
Effect. There are no citations or notices of forfeiture or other
proceedings pending or, to the best knowledge of the Company,
threatened or any basis therefor, which would lead to the revocation,
termination, suspension or non-renewal of any such license, franchise,
approval, certificate or permit except where all such revocations,
terminations, suspensions or non-renewals, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse
Effect.
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Other than as disclosed in the Final Memorandum, (i) there are no
license renewal or rate or tariff proceedings existing, pending or,
to the best knowledge of the Company, threatened against the Company
or any Guarantor that could reasonably be expected to have a Material
Adverse Effect, and (ii) there are no restrictions or limitations
contained in any applicable license, franchise, approval, certificate
or permit, or, to the best knowledge of the Company, threatened or
proposed in any pending or contemplated hearing, proceeding or
procedure, that could reasonably be expected to have a Material
Adverse Effect.
(y) Neither the Company nor any of its Affiliates (as defined
in Rule 501(b) of Regulation D under the Act) has directly, or through
any agent, (i) sold, offered for sale, solicited offers to buy or
otherwise negotiated in respect of, any security (as defined in the
Act) which is or will be integrated with the sale of the Notes in a
manner that would require the registration under the Act of the Notes
or (ii) engaged in any form of general solicitation or general
advertising in connection with the offering of the Notes (as those
terms are used in Regulation D under the Act) or in any manner
involving a public offering within the meaning of Section 4(2) of the
Act.
(z) The Notes, the Guarantees, the Indenture, the Note
Registration Rights Agreement and this Agreement conform in all
material respects to the descriptions thereof in the Final Memorandum.
(aa) Assuming the accuracy of each Initial Purchaser's
representations and warranties set forth in Section 3.2 hereof and the
due performance by each Initial Purchaser of the covenants and
agreements set forth in Section 3.2 hereof the offer and sale of the
Notes to the Initial Purchasers in the manner contemplated by this
Agreement and the Memorandum does not require registration under the
Act and the Indenture does not require qualification under the Trust
Indenture Act of 1939, as amended.
(ab) Neither the Company nor any of its Subsidiaries conducts
business with the government of Cuba or any Person or affiliate
located in Cuba. In the event the Company or any of its Subsidiaries
commences engaging in business with the government of Cuba or with any
Person or affiliate located in Cuba, the Company will provide the
Florida Department of Banking and Finance notice of such business in a
form acceptable to such Department.
Section 3.2. Resale of Notes. Each of the Initial Purchasers
represents and warrants (as to itself only) that it is a "qualified
institutional buyer" as defined in Rule 144A of the Act ("QIB"). Each of the
Initial Purchasers agrees with the Company (as to itself only) that (a) it has
not and will not solicit offers for, or offer or sell, the Notes by any form of
general solicitation or general advertising (as those terms are used in
21
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Regulation D under the Act) or in any manner involving a public offering within
the meaning of Section 4(2) of the Act; and (b) it has and will solicit offers
for the Notes only from, and will offer the Notes only to (A) in the case of
offers inside the United States, (i) Persons whom the Initial Purchasers
reasonably believe to be QIBs or, if any such Person is buying for one or more
institutional accounts for which such Person is acting as fiduciary or agent,
only when such Person has represented to the Initial Purchasers that each such
account is a QIB, to whom notice has been given that such sale or delivery is
being made in reliance on Rule 144A, and, in each case, in transactions under
Rule 144A or (ii) a limited number of other institutional investors reasonably
believed by the Initial Purchasers to be "Accredited Investors" (as defined in
Rule 501(a)(1), (2), (3) or (7) of the Act) that, prior to their purchase of
the Notes, deliver to the Initial Purchasers a letter containing the
representations and agreements set forth in Annex A to the Final Memorandum and
(B) in the case of offers outside the United States, to Persons other than U.S.
Persons ("foreign purchasers," which term shall include dealers or other
professional fiduciaries in the United States acting on a discretionary basis
for foreign beneficial owners (other than an estate or trust)); provided,
however, that, in the case of this clause (B), in purchasing such Notes such
Persons are deemed to have represented and agreed as provided under the caption
"Transfer Restrictions" contained in the Final Memorandum.
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
Section 4.1. Conditions Precedent to Obligations of the
Initial Purchasers. The obligation of each Initial Purchaser to purchase the
Notes to be purchased by it hereunder is subject, at the Time of Purchase, to
the satisfaction of the following conditions:
(a) The Initial Purchasers shall have received an opinion,
addressed to the Initial Purchasers in form and substance reasonably
satisfactory to counsel to the Initial Purchasers and dated the Time
of Purchase, from each of Holland & Knight, special counsel to the
Company and the Guarantors, substantially in the form of Exhibit 1(a)
hereto and Xxxxxxx X. Xxxxxxxx, Esq., General Counsel to the Company
and the Guarantors, substantially in the form of Exhibit 1(b) hereto.
(b) The Initial Purchasers shall have received an opinion,
addressed to the Initial Purchasers in form and substance satisfactory
to counsel to the Initial Purchasers and dated the Time of Purchase,
of Dow, Xxxxxx & Xxxxxxxxx, special communications counsel to the
Company and the Guarantors, substantially in the form of Exhibit 2
hereto.
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(c) The Initial Purchasers shall have received an opinion,
addressed to the Initial Purchasers in form and substance satisfactory
to the Initial Purchasers and dated the Time of Purchase, of Xxxxxx
Xxxxxx & Xxxxxxx, counsel to the Initial Purchasers, substantially in
the form of Exhibit 3 hereto.
In rendering such opinions in accordance with Sections 4.1(a),
(b) and (c), each such counsel may rely as to factual matters upon
certificates or other documents furnished by officers and directors of
the Company and representations of the Initial Purchasers and by
government officials, and upon such other documents as such counsel
deem appropriate as a basis for their opinion. Each such counsel may
specify the jurisdictions in which it is admitted to practice and that
it is not admitted to practice in any other jurisdiction or an expert
in the law of any other jurisdiction. To the extent such opinion
concerns the laws of any other such jurisdiction such counsel may rely
upon the opinion of counsel (reasonably satisfactory to the Initial
Purchasers) admitted to practice in such jurisdiction. Any opinion
relied upon by such counsel as aforesaid shall be delivered to the
Initial Purchasers together with the opinion of such counsel, which
opinion shall state that such counsel believes that their and the
Initial Purchasers' reliance thereon is justified.
(d) The Initial Purchasers shall have received from Price
Waterhouse LLP a comfort letter or letters dated the date hereof and
the Closing in form and substance reasonably satisfactory to counsel
to the Initial Purchasers.
(e) The representations and warranties made by the Company or
any Guarantor herein shall be true and correct in all material
respects (except for changes expressly provided for in this Agreement)
on and as of the Time of Purchase with the same effect as though such
representations and warranties had been made on and as of the Time of
Purchase, the Company and the Guarantors shall have complied in all
material respects with all agreements as set forth in or contemplated
hereunder and in the Basic Documents required to be performed by it at
or prior to the Time of Purchase and the Company shall have furnished
to each Purchaser a certificate, dated the Time of Purchase, to such
effect.
(f) Subsequent to the date of the Final Memorandum, (i) there
shall not have been any change, or any development involving a
prospective change, which has affected or may affect materially and
adversely the businesses, properties or prospects or the financial
condition or the results of operations of the Company and the
Subsidiaries, taken as a whole, and (ii) the Company and the
Subsidiaries shall have conducted their respective businesses only in
the ordinary course.
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(g) At the Time of Purchase and after giving effect to the
consummation of the transactions contemplated by this Agreement and
the Basic Documents, there shall exist no Default or Event of Default.
(h) The purchase of and payment for the Notes by the Initial
Purchasers hereunder shall not be prohibited or enjoined (temporarily
or permanently) by any applicable law or governmental regulation
(including, without limitation, Regulation G, T, U or X of the Board
of Governors of the Federal Reserve System).
(i) At the Time of Purchase, the Initial Purchasers shall
have received a certificate, dated the Time of Purchase, from the
Company stating that the conditions specified in Sections 4.1(e), (f)
and (g) have been satisfied or duly waived at the Time of Purchase.
(j) Each of the Basic Documents shall be satisfactory in form
and substance to each of the Initial Purchasers and shall have been
executed and delivered by all the respective parties thereto and shall
be in full force and effect.
(k) All proceedings taken in connection with the issuance of
the Notes and the transactions contemplated by this Agreement, the
Basic Documents and all documents and papers relating thereto shall be
reasonably satisfactory to the Initial Purchasers and counsel to the
Initial Purchasers. The Initial Purchasers and counsel to the Initial
Purchasers shall have received copies of such papers and documents as
they may reasonably request in connection therewith, all in form and
substance reasonably satisfactory to them.
(l) (i) There shall not have been any announcement by any
"nationally recognized statistical rating organization", as defined
for purposes of Rule 436(g) under the Act, that (A) it is downgrading
its rating assigned to any debt securities of the Company, or (B) it
is reviewing its rating assigned to any debt securities of the Company
with a view to possible downgrading, or with negative implications, or
direction not determined.
(m) Wood Gundy Inc. shall have sold the principal amount of
the Notes set forth opposite its name on Schedule I hereto in
accordance with the provisions of Section 3.2 hereof.
On or before the Closing, the Initial Purchasers and counsel
to the Initial Purchasers shall have received such further documents, opinions,
certificates and schedules or other instruments relating to the business,
corporate, legal and financial affairs of the Company and its Subsidiaries as
they may reasonably request.
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ARTICLE V
COVENANTS
Section 5.1. Covenants of the Company and the Guarantors.
The Company and the Guarantors covenant and agree with each of the Initial
Purchasers that:
(a) The Company will not amend or supplement the Final
Memorandum or any amendment or supplement thereto of which the Initial
Purchasers shall not previously have been advised and furnished a copy
for a reasonable period of time prior to the proposed amendment or
supplement and as to which the Initial Purchasers shall not have given
their consent, which consent shall not be unreasonably withheld. The
Company will promptly, upon the reasonable request of the Initial
Purchasers or counsel to the Initial Purchasers, make any amendments
or supplements to the Preliminary Memorandum or the Final Memorandum
that may be necessary or advisable in connection with the resale of
the Notes by the Initial Purchasers.
(b) The Company will cooperate with the Initial Purchasers in
arranging for the qualification of the Notes for offering and sale
under the securities or "Blue Sky" laws of such jurisdictions as the
Initial Purchasers may designate and will continue such qualifications
in effect for as long as may be reasonably necessary to complete the
resale of the Notes; provided, however, that in connection therewith,
the Company shall not be required to qualify as a foreign corporation
or to execute a general consent to service of process in any
jurisdiction or subject itself to taxation in excess of a nominal
dollar amount in any such jurisdiction where it is not then so
subject.
(c) If, at any time prior to the completion of the
distribution by the Initial Purchasers of the Notes or the Private
Exchange Notes, any event occurs or information becomes known as a
result of which the Final Memorandum as then amended or supplemented
would include any untrue statement of a material fact, or omit to
state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading,
or if for any other reason it is necessary at any time to amend or
supplement the Final Memorandum to comply with applicable law, the
Company will promptly notify the Initial Purchasers thereof (who
thereafter will not use such Final Memorandum until appropriately
amended or supplemented) and will prepare, at the expense of the
Company, an amendment or supplement to the Final Memorandum that
corrects such statement or omission or effects such compliance.
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(d) The Company will, without charge, provide to the Initial
Purchasers and to counsel to the Initial Purchasers as many copies of
the Preliminary Memorandum and the Final Memorandum or any amendment
or supplement thereto as the Initial Purchasers may reasonably
request.
(e) The Company will apply the net proceeds from the sale of
the Notes as set forth under "Use of Proceeds" in the Final
Memorandum.
(f) For and during the period ending on the date no Notes are
outstanding, the Company will furnish to the Initial Purchasers copies
of all reports and other communications (financial or otherwise)
furnished by the Company to the Trustee or the holders of the Notes
and, promptly after available, copies of any reports or financial
statements furnished to or filed by the Company with the Commission or
any national securities exchange on which any class of securities of
the Company may be listed.
(g) Prior to the Closing Date, the Company will furnish to
the Initial Purchasers, as soon as they have been prepared, a copy of
any unaudited interim financial statements of the Company for any
period subsequent to the period covered by the most recent financial
statements appearing in the Final Memorandum.
(h) None of the Company or any of its Affiliates will sell,
offer for sale or solicit offers to buy or otherwise negotiate in
respect of any "security" (as defined in the Act) which could be
integrated with the sale of the Notes in a manner which would require
the registration under the Act of the Notes.
(i) The Company will not, and will not permit any of its
Subsidiaries to, solicit any offer to buy or offer to sell the Notes
by means of any form of general solicitation or general advertising
(as those terms are used in Regulation D under the Act) or in any
manner involving a public offering within the meaning of Section 4(2)
of the Act.
(j) The Company will use its best efforts to (i) permit the
Notes to be included for quotation on PORTAL and (ii) permit the Notes
to be eligible for clearance and settlement through The Depository
Trust Company.
(k) The Company and the Guarantors (to the extent a party
thereto) will do and perform all things required to be done and
performed by them under this Agreement and the Basic Documents prior
to or after the Closing and to satisfy all conditions precedent on
their part to the obligations of the Initial Purchasers to purchase
and accept delivery of the Notes.
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ARTICLE VI
FEES
Section 6.1. Costs, Expenses and Taxes. The Company and the
Guarantors, jointly and severally, agree to pay all costs and expenses incident
to the performance of their obligations under this Agreement, whether or not
the transactions contemplated herein are consummated or this Agreement is
terminated pursuant to Section 8.2 hereof, including, but not limited to, all
costs and expenses incident to (i) the negotiation, preparation, printing,
typing, reproduction, execution and delivery of this Agreement and each of the
Basic Documents, any amendment or supplement to or modification of any of the
foregoing and any and all other documents furnished pursuant hereto or thereto
or in connection herewith or therewith, (ii) any costs of printing the
Preliminary Memorandum and the Final Memorandum and any amendment or supplement
thereto, and any "Blue Sky" memoranda (which shall include the reasonable
disbursements of counsel to the Initial Purchasers in respect thereof), (iii)
all arrangements relating to the delivery to the Initial Purchasers of copies
of the foregoing documents, (iv) the fees and disbursements of the counsel, the
accountants and any other experts or advisors retained by the Company, (v)
preparation (including printing), issuance and delivery to the Initial
Purchasers of the Notes, (vi) the qualification of the Notes under state
securities and "Blue Sky" laws, including filing fees and fees and
disbursements of counsel to the Initial Purchasers relating thereto, (vii)
expenses in connection with any meetings with prospective investors in the
Notes, (viii) fees and expenses of the trustee including fees and expenses of
counsel, (ix) all expenses and listing fees incurred in connection with the
application for quotation of the Notes on PORTAL, (x) any fees charged by
investment rating agencies for the rating of the Notes, (xi) the disbursements
(excluding road show related and printing expenses) of the Initial Purchasers
in an amount not to exceed $150,000 and (xii) except as limited by Article VII,
all costs and expenses (including, without limitation, reasonable attorneys'
fees and expenses), if any, in connection with the enforcement of this
Agreement, the Notes or any other agreement furnished pursuant hereto or
thereto or in connection herewith or therewith. In addition, the Company shall
pay any and all stamp, transfer and other similar taxes payable or determined
to be payable in connection with the execution and delivery of this Agreement,
any Basic Document or the issuance of the Notes, and shall save and hold each
Initial Purchaser harmless from and against any and all liabilities with
respect to or resulting from any delay in paying, or omission to pay, such
taxes.
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ARTICLE VII
INDEMNITY
Section 7.1. Indemnity.
(a) Indemnification by the Company and the Guarantors. The
Company and the Guarantors, jointly and severally, agree and covenant to hold
harmless and indemnify each of the Initial Purchasers and any Affiliates
thereof (including any director, officer, employee, agent or controlling Person
of any of the foregoing) from and against any losses, claims, damages,
liabilities and expenses (including expenses of investigation) to which such
Initial Purchaser and its Affiliates may become subject arising out of or based
upon any untrue statement or alleged untrue statement of any material fact
contained in the Memorandum and any amendments or supplements thereto, the
Basic Documents, any documents filed with the Commission or any State
Commission (collectively, the "Offering Materials") or arising out of or based
upon the omission or alleged omission to state in any of the Offering Materials
a material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that the Company and the
Guarantors shall not be liable under this paragraph (a) to the extent that such
losses, claims, damages or liabilities arose out of or are based upon an untrue
statement or omission made in any of the documents referred to in this
paragraph (a) in reliance upon and in conformity with the information relating
to the Initial Purchasers furnished in writing by such Initial Purchasers for
inclusion therein; provided, further, that the Company and the Guarantors shall
not be liable under this paragraph (a) to the extent that such losses, claims,
damages or liabilities arose out of or are based upon an untrue statement or
omission made in any Memorandum that is corrected in the Final Memorandum (or
any amendment or supplement thereto) if the person asserting such loss, claim,
damage or liability purchased Notes from an Initial Purchaser in reliance on
such Memorandum but was not given the Final Memorandum (or any amendment or
supplement thereto) on or prior to the confirmation of the sale of such Notes.
The Company and the Guarantors further agree to reimburse each Initial
Purchaser for any reasonable legal and other expenses as they are incurred by
it in connection with investigating, preparing to defend or defending any
lawsuits, claims or other proceedings or investigations arising in any manner
out of or in connection with such Person being an Initial Purchaser; provided
that if the Company or the Guarantors reimburse an Initial Purchaser hereunder
for any expenses incurred in connection with a lawsuit, claim or other
proceeding for which indemnification is sought, such Initial Purchaser hereby
agrees to refund such reimbursement of expenses to the extent that the losses,
claims, damages or liabilities arise out of or are based upon an untrue
statement or omission made in any of the documents referred to in this
paragraph (a) in reliance upon and in conformity with the information relating
to the Initial Purchasers furnished in writing by such Initial Purchasers for
inclusion therein. The Company and the Guarantors further agree that the
indemnification, contribution and reimbursement commitments set forth in this
Article VII
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shall apply whether or not an Initial Purchaser is a formal party to any such
lawsuits, claims or other proceedings. The indemnity, contribution and expense
reimbursement obligations of the Company and the Guarantors under this Article
VII shall be in addition to any liability the Company may otherwise have.
(b) Indemnification by the Initial Purchasers. Each of the
Initial Purchasers agrees and covenants, severally and not jointly, to hold
harmless and indemnify the Company and the Guarantors and any Affiliates
thereof (including any director, officer, employee, agent or controlling Person
of any of the foregoing) from and against any losses, claims, damages,
liabilities and expenses insofar as such losses, claims, damages, liabilities
or expenses arise out of or are based upon any untrue statement of any material
fact contained in the Offering Materials, or upon the 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 omission was made in reliance upon and in
conformity with the information relating to such Initial Purchaser furnished in
writing by such Initial Purchaser for inclusion therein. The indemnity,
contribution and expense reimbursement obligations of the Initial Purchasers
under this Article VII shall be in addition to any liability the Initial
Purchasers may otherwise have.
(c) Procedure. If any Person shall be entitled to indemnity
hereunder (each an "Indemnified Party"), such Indemnified Party shall give
prompt written notice to the party or parties from which such indemnity is
sought (each an "Indemnifying Party") of the commencement of any action, suit,
investigation or proceeding, governmental or otherwise (a "Proceeding"), with
respect to which such Indemnified Party seeks indemnification or contribution
pursuant hereto; provided, however, that the failure so to notify the
Indemnifying Parties shall not relieve the Indemnifying Parties from any
obligation or liability except to the extent that the Indemnifying Parties have
been prejudiced materially by such failure. The Indemnifying Parties shall
have the right, exercisable by giving written notice to an Indemnified Party
promptly after the receipt of written notice from such Indemnified Party of
such Proceeding, to assume, at the Indemnifying Parties' expense, the defense
of any such Proceeding, with counsel reasonably satisfactory to such
Indemnified Party; provided, however, that an Indemnified Party or parties (if
more than one such Indemnified Party is named in any Proceeding) shall have the
right to employ separate counsel in any such Proceeding and to participate in
the defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Party or parties unless: (1) the Indemnifying
Parties agree to pay such fees and expenses; or (2) the Indemnifying Parties
fail promptly to assume the defense of such Proceeding or fail to employ
counsel reasonably satisfactory to such Indemnified Party or parties; or (3)
the named parties to any such Proceeding (including any impleaded parties)
include both such Indemnified Party or parties and the Indemnifying Party or an
Affiliate of the Indemnifying Party and such Indemnified Parties, and the
Indemnified Parties shall have been advised in writing by counsel that there
may be one or more legal
29
-24-
defenses available to such Indemnified Party or parties that are different from
or additional to those available to the Indemnifying Parties, in which case, if
such Indemnified Party or parties notifies the Indemnifying Parties in writing
that it elects to employ separate counsel at the expense of the Indemnifying
Parties, the Indemnifying Parties shall not have the right to assume the
defense thereof and such counsel shall be at the expense of the Indemnifying
Parties, it being understood, however, that, unless there exists a conflict
among Indemnified Parties, the Indemnifying Parties shall not, in connection
with any one such Proceeding or separate but substantially similar or related
Proceedings in the same jurisdiction, arising out of the same general
allegations or circumstances, be liable for the fees and expenses of more than
one separate firm of attorneys (together with appropriate local counsel) at any
time for such Indemnified Party or parties, or for fees and expenses that are
not reasonable. No Indemnified Party or parties will settle any Proceeding
without the consent of the Indemnifying Party or parties (but such consent
shall not be unreasonably withheld). No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of any
pending or threatened Proceeding in respect of which any Indemnified Party is
or could have been or 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 or claims that are the
subject of such Proceeding.
Section 7.2. Contribution. If for any reason the
indemnification provided for in Section 7.1 of this Agreement is unavailable to
an Indemnified Party, or insufficient to hold it harmless, in respect of any
losses, claims, damages, liabilities or expenses referred to therein, then each
applicable Indemnifying Party, in lieu of indemnifying such Indemnified Party,
shall contribute to the amount paid or payable by such Indemnified Party as a
result of such losses, claims, damages or liabilities in such proportion as is
appropriate to reflect not only the relative benefits received by the
Indemnifying Party on the one hand and the Indemnified Party on the other, but
also the relative fault of the Indemnifying and Indemnified Parties 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 Indemnifying and
Indemnified Parties shall be deemed to be in the same proportion as the total
proceeds from the offering of the Notes (before deducting expenses) received by
the Company bear to the total discounts and commissions received by each
Initial Purchaser. The relative fault of the Indemnifying and Indemnified
Parties 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 Indemnifying or Indemnified Parties and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of
the losses, claims, damages and liabilities referred to above shall be deemed
to include any legal or other fees or expenses incurred by such party in
connection with investigating or defending any such claim.
30
-25-
The Company and each of the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to the immediately
preceding paragraph were determined pro rata or per capita or by any other
method of allocation which does not take into account the equitable
considerations referred to in such paragraph. Notwithstanding any other
provision of this Section 7.2, no Initial Purchaser shall be obligated to make
contributions hereunder that in the aggregate exceed the total discounts,
commissions and other compensation received by such Initial Purchaser under
this Agreement, less the aggregate amount of any damages that such Initial
Purchaser has otherwise been required to pay by reason of the untrue or alleged
untrue statements or the omissions or alleged omissions to state a material
fact. No Person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any Person who
was not guilty of such fraudulent misrepresentation.
Section 7.3. Note Registration Rights Agreement.
Notwithstanding anything to the contrary in this Article 7, the indemnification
and contribution provisions of the Note Registration Rights Agreement shall
govern any claim with respect thereto.
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Survival of Provisions. The representations,
warranties and covenants of the Company, its officers and the Initial
Purchasers made herein, the indemnity and contribution agreements contained
herein and each of the provisions of Articles V, VII and VIII shall remain
operative and in full force and effect regardless of (a) any investigation made
by or on behalf of the Company, any Initial Purchaser or any Indemnified Party,
(b) acceptance of any of the Notes and payment therefor, (c) any termination of
this Agreement, or (d) disposition of the Notes by the Initial Purchasers
whether by redemption, exchange, sale or otherwise.
Section 8.2. Termination. 1. This Agreement may be terminated
in the sole discretion of the Initial Purchasers by notice to the Company given
prior to the Time of Purchase in the event that the Company shall have failed,
refused or been unable to perform all obligations and satisfy all conditions on
its part to be performed or satisfied hereunder at or prior thereto or, if at
or prior to the Closing:
(i) the Company or any of its Subsidiaries shall have
sustained any loss or interference with respect to its businesses or
properties from fire, flood, hurricane, accident or other calamity,
whether or not covered by insurance, or from any strike, labor
dispute, slow down or work stoppage or any legal or governmental
proceeding, which loss or interference, in the sole judgment of the
Initial Purchasers, has had or has a Material Adverse Effect, or there
shall have been, in the sole judgment of the Initial Purchasers, any
event or development
31
-26-
that, individually or in the aggregate, has or could be reasonably
likely to have a Material Adverse Effect (including without limitation
a change in control of the Company or any of its Subsidiaries), except
in each case as described in the Final Memorandum (exclusive of any
amendment or supplement thereto);
(ii) trading in securities of the Company or in securities
generally on the New York Stock Exchange, American Stock Exchange or
the Nasdaq National Market shall have been suspended or minimum or
maximum prices shall have been established on any such exchange or
market;
(iii) a banking moratorium shall have been declared by New
York or United States authorities;
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, or (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or any other national or international
calamity or emergency, or (C) any material change in the financial
markets of the United States which, in the case of (A), (B) or (C)
above and in the sole judgment of the Initial Purchasers, makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Notes as contemplated by the Final Memorandum; or
(v) any securities of the Company shall have been downgraded
or placed on any "watch list" for possible downgrading by any
nationally recognized statistical rating organization.
(vi) Termination of this Agreement pursuant to this Section
8.2 shall be without liability of any party to any other party except
as provided in Section 8.1 hereof.
Section 8.3. No Waiver; Modifications in Writing. No failure
or delay on the part of the Company or any Initial Purchaser in exercising any
right, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, power or remedy preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy. The remedies provided for herein are cumulative and are not exclusive
of any remedies that may be available to the Company or any Initial Purchaser
at law or in equity or otherwise. No waiver of or consent to any departure by
the Company from any provision of this Agreement shall be effective unless
signed in writing by the party entitled to the benefit thereof, provided that
notice of any such waiver shall be given to each party hereto as set forth
below. Except as otherwise provided herein, no amendment, modification or
termination of any provision of this Agreement shall be effective unless signed
in writing by or on behalf of each of the Company and each Initial Purchaser.
Any amendment, supplement or modification of or to any
32
-27-
provision of this Agreement, any waiver of any provision of this Agreement, and
any consent to any departure by the Company from the terms of any provision of
this Agreement, shall be effective only in the specific instance and for the
specific purpose for which made or given. Except where notice is specifically
required by this Agreement, no notice to or demand on the Company in any case
shall entitle the Company to any other or further notice or demand in similar
or other circumstances.
Section 8.4. Information Supplied by the Initial Purchasers.
The statements set forth in the last paragraph on the front cover page and in
the second and third sentences of the third paragraph and the seventh paragraph
under the heading "Plan of Distribution" in the Final Memorandum (to the extent
such statements relate to the Initial Purchasers) constitute the only
information furnished by the Initial Purchasers to the Company for the purposes
of Sections 3.1(a) and 7.1(a) hereof.
Section 8.5. Communications. All notices, demands and other
communications provided for hereunder shall be in writing, and, (a) if to the
Initial Purchasers, shall be given by registered or certified mail, return
receipt requested, telex, telegram, telecopy, courier service or personal
delivery, addressed to CIBC Wood Gundy Securities Corp., 0000 Xxxxxx xx xxx
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, (b) if to the Company, shall be given by
similar means to 000 Xxxxxxxxxx Xxxx Xxxx, Xxxx Xxxx Xxxxx, Xxxxxxx 00000,
attn: Chief Financial Officer and General Counsel with copies to Holland &
Knight, 000 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxx, Xxxxxxx 00000, attn: Xxxxxxx
X. Xxxxxxxx. In each case notices, demands and other communications shall be
deemed given when received.
Section 8.6. Execution in Counterparts. This Agreement may
be executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute but one and the same Agreement.
Section 8.7. Successors. This Agreement shall inure to the
benefit of and be binding upon the Initial Purchasers, the Company and their
respective successors and legal representatives, and nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
Person any legal or equitable right, remedy or claim under or in respect of
this Agreement, or any provisions herein contained; this Agreement and all
conditions and provisions hereof being intended to be and being for the sole
and exclusive benefit of such Persons and for the benefit of no other Person
except that (i) the indemnities of the Company contained in Section 7.1(a) of
this Agreement shall also be for the benefit of the directors, officers,
employees and agents of the Initial Purchasers and any Person or Persons who
control the Initial Purchasers within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act and (ii) the indemnities of the Initial
Purchasers contained in Section 7.1(b) of this Agreement shall also be for the
33
-28-
benefit of the directors of the Company, its officers and any Person or Persons
who control the Company within the meaning of Section 15 of the Act or Section
20 of the Exchange Act. No purchaser of Notes from the Initial Purchasers will
be deemed a successor because of such purchase.
Section 8.8. Governing Law. THIS AGREEMENT SHALL BE DEEMED
TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL
PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
Section 8.9. Severability of Provisions. Any provision of
this Agreement which is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 8.10. Headings. The Article and Section headings and
Table of Contents used or contained in this Agreement are for convenience of
reference only and shall not affect the construction of this Agreement.
34
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first written above.
XXXXXX COMMUNICATIONS CORPORATION
(a Delaware corporation)
By: /s/ Xxxxxx Tek
-------------------------------
Name: Xxxxxx Tek
Title: Treasurer
XXXXXX COMMUNICATIONS TELEVISION,
INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF FLORIDA,
INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS LP, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS MANAGEMENT
COMPANY
(a Florida corporation)
XXXXXX COMMUNICATIONS MARKETING,
INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS NETWORKS, INC.
(a Florida corporation)
XXXXXX OUTDOOR, INC.
(a Florida corporation)
XXXXXX NETWORKS, INC.
(a Florida corporation)
EXCEL MARKETING ENTERPRISES, INC.
(a Florida corporation)
35
INFOMALL CABLE NETWORK, INC.
(a Delaware corporation)
INFOMALL TV NETWORK, INC.
(a Delaware corporation)
INFOMALL LOS ANGELES, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF AKRON-23,
INC.
(a Florida corporation)
XXXXXX AKRON LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF ATLANTA-14,
INC.
(a Florida corporation)
XXXXXX ATLANTA LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF BOSTON-60,
INC.
(a Florida corporation)
XXXXXX BOSTON LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF CLEVELAND-
67, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF COOKEVILLE,
INC.
(a Florida corporation)
XXXXXX COOKEVILLE LICENSE, INC.
(a Florida corporation)
36
XXXXXX COMMUNICATIONS OF DALLAS-68,
INC.
(a Florida corporation)
XXXXXX XXXXXX LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF DAYTON-26,
INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF DENVER-59,
INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF FT.
XXXXXX-34, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF HOUSTON-49,
INC.
(a Florida corporation)
XXXXXX HOUSTON LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF LOS
ANGELES-30, INC.
(a Florida corporation)
XXXXXX LOS ANGELES LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF MIAMI-35,
INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF MILWAUKEE-
55, INC.
(a Florida corporation)
37
XXXXXX COMMUNICATIONS OF
MINNEAPOLIS-45, INC.
(a Florida corporation)
XXXXXX MINNEAPOLIS LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF NEW
LONDON-26, INC.
(a Florida corporation)
XXXXXX NEW LONDON LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF NEW YORK-
43, INC.
(a Florida corporation)
XXXXXX NEW YORK LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF ORLANDO-56,
INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF
PHILADELPHIA-61, INC.
(a Florida corporation)
XXXXXX PHILADELPHIA LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF PHOENIX-13,
INC.
(a Florida corporation)
XXXXXX PHOENIX LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF ST. LOUIS,
INC.
(a Florida corporation)
38
XXXXXX ST. XXXXX LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF SAN XXXX-65,
INC.
(a Florida corporation)
XXXXXX SAN XXXX LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF TAMPA-66,
INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF
WASHINGTON-60, INC.
(a Florida corporation)
XXXXXX WASHINGTON LICENSE, INC.
(a Florida corporation)
XXXXXX COMMUNICATIONS OF WEST PALM
BEACH-25, INC.
(a Florida corporation)
XXXXXX WEST PALM BEACH LICENSE, INC.
(a Florida corporation)
By: /s/ Xxxxxx Tek
--------------------------------
Name: Xxxxxx Tek
Title: Treasurer
XXXXXX BROADCASTING OF JACKSONVILLE,
LIMITED PARTNERSHIP
(a Florida partnership)
XXXXXX JACKSONVILLE LICENSE
LIMITED PARTNERSHIP
(a Florida partnership)
39
XXXXXX BROADCASTING OF MIAMI,
LIMITED PARTNERSHIP
(a Florida partnership)
XXXXXX MIAMI LICENSE LIMITED
PARTNERSHIP
(a Florida partnership)
XXXXXX BROADCASTING OF ORLANDO,
LIMITED PARTNERSHIP
(a Florida partnership)
XXXXXX XXXXXXX LICENSE LIMITED
PARTNERSHIP
(a Florida partnership)
XXXXXX BROADCASTING OF TAMPA,
LIMITED PARTNERSHIP
(a Florida partnership)
40
XXXXXX TAMPA LICENSE LIMITED
PARTNERSHIP
(a Florida partnership)
By: Xxxxxx Communications of Florida,
Inc., their general partner
By: /s/ Xxxxxx Tek
-------------------------------
Name: Xxxxxx Tek
Title: Treasurer
WOOD GUNDY INC.
By: /s/ X.X. Xxxxxxx
----------------------------------------
Name: X. X. Xxxxxxx
Title: Director
XXXXX XXXXXX INC.
By: /s/ M.E. Xxxxxxxx
------------------------------------------
Name: M.E. Xxxxxxxx
Title: Director
41
SCHEDULE I
Principal Amount
Initial Purchaser of Notes
----------------- ----------------
Wood Gundy Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . $138,000,000
Xxxxx Xxxxxx Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 92,000,000
------------
Total . . . . . . . . . . . . . . . . . . . $230,000,000
============
