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EXHIBIT 2.2
OPERATING AGREEMENT
OF
ST. LOUIS POST-DISPATCH LLC
Dated As Of:
May 1, 2000
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TABLE OF CONTENTS
PAGE
RECITALS 1
ARTICLE I DEFINITIONS AND TERMS..........................................................1
SECTION 1.1 Certain Definitions.......................................................1
SECTION 1.2 Rules of Construction.....................................................6
ARTICLE II GENERAL MATTERS...............................................................7
SECTION 2.1 Formation.................................................................7
SECTION 2.2 Purposes and Business.....................................................7
SECTION 2.3 Offices...................................................................7
SECTION 2.4 Name......................................................................8
SECTION 2.5 Term......................................................................8
SECTION 2.6 Members...................................................................8
ARTICLE III FINANCIAL AND TAX MATTERS....................................................8
SECTION 3.1 Capital Contributions.....................................................8
SECTION 3.2 Loans from Members........................................................9
SECTION 3.3 Restrictions Relating to Capital; Company Property........................9
SECTION 3.4 Tax Treatment............................................................10
SECTION 3.5 Allocation of Profits and Losses.........................................10
SECTION 3.6 Other Allocation Rules...................................................10
SECTION 3.7 Tax Elections............................................................10
SECTION 3.8 Tax Allocations; Code Section 704(c).....................................11
SECTION 3.9 Tax Matters Member.......................................................12
SECTION 3.10 Regular Distribution Policy..............................................12
SECTION 3.11 Special Distributions....................................................12
SECTION 3.12 Permanent Company Debt...................................................13
SECTION 3.13 Allocations Upon Liquidation of the Company..............................13
SECTION 3.14 Reimbursement of Certain Expenses........................................13
ARTICLE IV MANAGEMENT 13
SECTION 4.1 General..................................................................13
SECTION 4.2 Standard of Care; Indemnification........................................14
SECTION 4.3 Capital Expenditures.....................................................14
SECTION 4.4 Reserves.................................................................15
ARTICLE V ACCOUNTING, BOOKS AND RECORDS.................................................15
SECTION 5.1 Fiscal Year..............................................................15
SECTION 5.2 Books and Records........................................................15
SECTION 5.3 Auditors.................................................................15
SECTION 5.4 Reporting................................................................15
SECTION 5.5 Banking..................................................................16
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PAGE
SECTION 5.6 Tax Return Information...................................................16
SECTION 5.7 Six Year Projections.....................................................16
ARTICLE VI CONFIDENTIALITY; NONCOMPETITION..............................................16
SECTION 6.1 Confidentiality Obligation...............................................16
SECTION 6.2 Noncompetition...........................................................16
ARTICLE VII TRANSFER OF INTERESTS; PUT RIGHT............................................17
SECTION 7.1 General..................................................................17
SECTION 7.2 Put Right................................................................18
SECTION 7.3 Termination of a Member's Interest.......................................18
ARTICLE VIII DISSOLUTION AND WINDING UP.................................................18
SECTION 8.1 Dissolution..............................................................18
SECTION 8.2 Winding Up...............................................................19
SECTION 8.3 Pulitzer Purchase........................................................19
ARTICLE IX MISCELLANEOUS................................................................20
SECTION 9.1 Notices..................................................................20
SECTION 9.2 Amendment; Waiver........................................................20
SECTION 9.3 Assignment...............................................................20
SECTION 9.4 Entire Agreement.........................................................20
SECTION 9.5 Parties in Interest......................................................20
SECTION 9.6 Governing Law; Submission to Jurisdiction; Selection of Forum............21
SECTION 9.7 Counterparts.............................................................21
SECTION 9.8 Severability.............................................................21
SECTION 9.9 No Agency................................................................21
SECTION 9.10 Limitation of Liability..................................................22
SCHEDULE 1 . Identification of Members
SCHEDULE 2 . Permitted Transactions
APPENDIX A . Definition of Deemed Value
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OPERATING AGREEMENT
OF
ST. LOUIS POST-DISPATCH LLC
THIS OPERATING AGREEMENT of ST. LOUIS POST-DISPATCH LLC, a Delaware limited
liability company (the "Company"), is made and entered into as of May 1, 2000,
among The Herald Company, Inc., a New York corporation ("Herald"), Pulitzer
Inc., a Delaware corporation ("Pulitzer" or the "Managing Member"), Pulitzer
Technologies, Inc., a Delaware corporation ("PTI"), and such other Persons that
become Members as herein provided.
RECITALS
WHEREAS, the Company, Pulitzer, PTI and Herald are parties to that certain
Joint Venture Agreement, dated as of May 1, 2000 (the "Joint Venture
Agreement");
WHEREAS, Herald and Pulitzer have entered into that certain Indemnity
Agreement (the "Herald Indemnity"), dated as of May 1, 2000;
WHEREAS, pursuant to and subject to the terms and conditions of the Joint
Venture Agreement, each of Herald, Pulitzer and PTI will contribute, or cause to
be contributed, to the Company their respective interests in certain assets and
liabilities relating to the St. Louis Post-Dispatch in exchange for equity
interests in the Company;
WHEREAS, the Members desire to enter into this Agreement, which shall
constitute the limited liability company agreement of the Members under the
Delaware Act, for the purpose of setting forth the agreements of the Members as
to the affairs of the Company and the conduct of its business;
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and undertakings contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS AND TERMS
SECTION 1.1 Certain Definitions.
As used herein, the following terms shall have the meanings set forth or as
referenced below:
"Affiliate" of a Person means any Person directly or indirectly
controlling, controlled by or under direct or indirect common control with such
Person as of the date on which, or at any time during the period for which, the
determination of affiliation is being made. For the purpose of this definition,
"control" means (i) the direct or indirect ownership or control of more than 50%
of the voting stock or other voting interest in any Person, or (ii) the ability
to
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direct or cause the direction of the management or affairs of a Person, whether
through the direct or indirect ownership of voting interests, by contract or
otherwise.
"Agency Agreement" has the meaning set forth in the Joint Venture
Agreement.
"Agreed Value" means the Fair Market Value of Contributed Assets net of
Assumed Liabilities, as set forth in, or determined pursuant to, Section 3.1 of
this Agreement.
"Agreement" shall mean this Operating Agreement, including the schedules
and exhibits hereto, as the same may be amended or supplemented from time to
time in accordance with the terms hereof.
"Assumed Liabilities" means the Pulitzer Assumed Liabilities, the PTI
Assumed Liabilities and the Herald Assumed Liabilities, each as defined in the
Joint Venture Agreement.
"Business Day" means a day, other than a Saturday or Sunday, on which banks
generally are open in New York City, St. Louis and Wilmington, Delaware for a
full range of business.
"Capital Account" means, with respect to any Member, the Capital Account
maintained for such Member in accordance with the following provisions:
(i) To each Member's Capital Account there shall be added the amount
of money and the initial Gross Asset Value of any property (other than
money) contributed to the Company by such Member (or its predecessors in
interest), such Member's distributive share of Profits, and the amount of
any Company liabilities assumed by such Member or which are secured by any
Company Property distributed to such Member.
(ii) From each Member's Capital Account there shall be subtracted the
amount of money and the Gross Asset Value of any Company Property
distributed to such Member pursuant to any provision of this Agreement,
such Member's distributive share of Losses, and the amount of any
liabilities of such Member assumed by the Company or which are secured by
any property contributed by such Member to the Company.
(iii) In the event all or a portion of an Interest is Transferred in
accordance with the terms of this Agreement, the Transferee shall succeed
to the Capital Account of the Transferor to the extent it relates to the
Transferred Interest.
"Capital Contribution" means, with respect to any Member, the amount of
money and the Gross Asset Value of any property (other than money) contributed
by such Member to the Company.
"Certificate of Formation" shall have the meaning set forth in Section 2.1.
"Closing" and "Closing Date" shall have the respective meanings set forth
in the Joint Venture Agreement.
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"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and any successor to such statute.
"Company" shall have the meaning set forth in the preamble hereto.
"Company Business" means the operations and activities carried on by the
Company and its subsidiaries, including the operations of the St. Louis
Post-Dispatch, the operations of any entities or businesses contributed by the
Members to the Company pursuant to the Joint Venture Agreement and any
businesses subsequently operated by the Company.
"Company Debt" means the loan in the aggregate principal amount of $306
million to the Company from the Prudential Insurance Company of America and
certain other institutional lenders.
"Company Property" means any and all property of whatever nature, tangible
or intangible, real or personal, of the Company from time to time.
"Contributed Assets" means the Pulitzer Contributed Assets, the PTI
Contributed Assets and the Herald Contributed Assets, each as defined in the
Joint Venture Agreement.
"CPA Firm" means the independent public auditor of the Company's books and
records designated by Pulitzer pursuant to Section 5.3.
"Debt" means any liability of the Company (including, without limitation,
liabilities to Members) for borrowed money, or any liability for the payment of
money by the Company in connection with any guarantees, surety agreements,
letters of credit, or other interest-bearing liabilities evidenced by any bond,
debenture, note or other similar instrument, excluding any trade liabilities or
any non-interest-bearing liabilities or obligations.
"Deemed Tax Benefit" shall have the meaning set forth in Section 3.11.
"Deemed Value" has the meaning set forth in Appendix A to this Agreement.
"Delaware Act" means the Delaware Limited Liability Company Act, 6 Del. C.
18-101 et seq., as amended from time to time, and any successor to such statute.
"Depreciation" means, for each Fiscal Year or other period, an amount equal
to the depreciation, amortization or other cost recovery deduction allowable for
federal income tax purposes with respect to an asset for such Fiscal Year or
other period, except that if the Gross Asset Value of an asset differs from its
adjusted basis for federal income tax purposes at the beginning of such Fiscal
Year or other period, Depreciation shall be determined by the Managing Member in
the manner described in Regulations Section 1.704-1(b)(2)(iv)(g)(3).
"Fair Market Value" means, with respect to Company Property, as of any date
of determination, the price for such Company Property that could be negotiated
in an arm's-length transaction, for cash, between a willing seller and a willing
buyer, neither of whom is under pressure or compulsion to complete the
transaction, as of such date of determination. The Fair Market Value of Company
Property shall be determined by the Members. If the Members are
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unable to reach agreement on such determination, each of Pulitzer and Herald
shall select an independent and nationally recognized investment banking firm
and such investment banking firms shall select a third independent and
nationally recognized investment banking firm, as they may deem appropriate and
in the best position to determine the Fair Market Value of such property, whose
determination of the Fair Market Value shall be final and binding.
"Final Determination" means (i) a binding decision, judgment, decree or
other order by any court of competent jurisdiction, which has become final and
not subject to further appeal, (ii) a closing agreement entered into under
Section 7121 of the Code or any other binding settlement agreement with the
Internal Revenue Service entered into in connection with or in contemplation of
an administrative or judicial proceeding, or (iii) the completion of Internal
Revenue Service administrative proceedings if a judicial contest is not or is no
longer available or, in the sole discretion of the Managing Member, is not to be
commenced or continued.
"Fiscal Year" means the fiscal year of the Company as specified in Section
5.1.
"Gross Asset Value" means, with respect to any Company Property, its
adjusted basis for federal income tax purposes, except as follows:
(i) The Gross Asset Value of Contributed Assets at the time of their
contribution to the Company pursuant to the Joint Venture Agreement and in
accordance with Section 3.1, net of Assumed Liabilities, shall be their
Agreed Value.
(ii) The initial Gross Asset Value of any other Company Property
contributed by a Member to the Company shall be its Fair Market Value on
the date of contribution.
(iii) The Gross Asset Value of any Company Property distributed to any
Member shall be adjusted to equal its Fair Market Value on the date of
distribution.
(iv) The Gross Asset Value of all Company Properties shall be
adjusted to equal their respective Fair Market Values in accordance
with the rules set forth in, and at such times as provided under,
Regulations Section 1.704-1(b)(2)(iv)(f).
(v) If the Gross Asset Value of Company Property has been determined
or adjusted pursuant to this definition, such Gross Asset Value shall
thereafter be adjusted by the Depreciation taken into account with respect
to such Company Property for purposes of computing Profits and Losses.
"Herald" shall have the meaning set forth in the preamble hereto.
"Herald Indemnity" has the meaning set forth in the recitals to this
Agreement.
"Herald Put" shall have the meaning set forth in Section 7.2(a).
"Indemnitee" shall have the meaning set forth in Section 4.2(a).
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"Interest" means the membership interest of a Member in the Company
(which shall be considered personal property for all purposes), consisting
of (i) such Member's interest in Profits, Losses and distributions, (ii)
such Member's right to vote or grant or withhold consents with respect to
Company matters as provided herein or in the Delaware Act and (iii) such
Member's other rights and privileges as provided herein or under the
Delaware Act, in each case subject to the obligations of such Member under
this Agreement or applicable Law.
"Joint Venture Agreement" shall have the meaning set forth in the
recitals hereto.
"Law" means any federal, state, foreign or local law, constitutional
provision, code, statute, ordinance, rule, regulation, order, judgment or
decree of any governmental authority.
"Managing Member" means Pulitzer (acting through any Person or Persons
properly designated by it), and its successors, assigns or transferees.
"Member Loan" shall mean any loan from a Member to the Company in
accordance with Section 3.2.
"Members" mean Herald, Pulitzer, PTI and all other Persons admitted as
additional or substituted Members pursuant to this Agreement, so long as
they remain Members. Each Member shall constitute a "member" of the
Company, as such term is defined in Section 18-101 of the Delaware Act.
"Minimum Reserve Amount" shall mean (i) at any time on or prior to the
tenth anniversary of the Closing Date, an amount equal to the product of
(A) $15 million and (B) the time since the Closing Date (expressed in years
and quarters of a year to the end of the last preceding quarter) and (ii)
after the tenth anniversary of the Closing Date, zero.
"Percentage Interest" means initially: for Pulitzer, 94%, for PTI, 1%,
and for Herald, 5%; and thereafter as adjusted to reflect any permitted
Transfers.
"Permanent Company Debt" shall mean the Company Debt and any
replacement or refinancing of the Company Debt or any Permanent Company
Debt in accordance with Section 3.12.
"Person" shall mean an individual, a corporation, a partnership, an
association, a trust, a limited liability company, a governmental authority
or any other entity or organization.
"Profits" or "Losses" means, for each Fiscal Year or other period, an
amount equal to the Company's taxable income or loss for such Fiscal Year
or other period, determined in accordance with Code Section 703(a) and
assuming the tax basis of each asset contributed to the Company had been
equal to its Gross Asset Value at the date of such contribution. Profits
and Losses shall be adjusted as follows: (i) any income of the Company that
is exempt from federal income tax and not otherwise taken into account in
computing Profits and Losses shall be added to such taxable income or loss;
(ii) any expenditures of the Company described as Code Section 705(a)(2)(B)
expenditures pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not
otherwise taken into account in computing Profits and Losses, shall be
subtracted from such
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taxable income or loss; (iii) in lieu of depreciation, amortization and
cost recovery deductions taken into account in computing such taxable
income or loss, there shall be taken into account Depreciation for such
Fiscal Year or other period, computed in accordance with the definition of
"Depreciation"; and (iv) if the Gross Asset Value of any Company Property
differs from its adjusted tax basis for federal income tax purposes, any
gain or loss resulting from a disposition of such Company Property shall be
calculated with respect to such Gross Asset Value.
"PTI" shall have the meaning set forth in the preamble hereto.
"Pulitzer" shall have the meaning set forth in the preamble hereto.
"Put Price" shall have the meaning set forth in Section 7.2(a).
"Put-Related Covenants" shall mean (i) that Herald and its Affiliates
will report the transactions contemplated by this Agreement and the Joint
Venture Agreement in a manner consistent with the Company's tax returns and
(ii) the covenants of Herald set forth in Section 5 of the Herald
Indemnity.
"Regulations" means the regulations promulgated by the U.S. Treasury
Department pursuant to the Code.
"Reserve Asset Value" shall mean, at any time, the value of all cash,
U.S. Treasury obligations and other obligations backed by the full faith
and credit of the United States then held by the Company.
"Special Distributions" shall have the meaning set forth in Section
3.11 hereof.
"Subsidiary" means any Contributed Entity (as defined in the Joint
Venture Agreement) or any other Person controlled by the Company.
"Tax Matters Member" shall have the meaning set forth in Section 3.9.
"Transaction Agreements" shall have the meaning set forth in the Joint
Venture Agreement.
"Transfer" shall have the meaning set forth in Section 7.1(a).
"Transferee" means a Person to whom a Member has Transferred its
Interest pursuant to Section 7.1.
SECTION 1.2 Rules of Construction.
(a) Words used herein, regardless of the number and gender used, shall
be deemed and construed to include any other number, singular or plural,
and any other gender, masculine, feminine or neuter, as the context
requires, and, as used herein, unless the context requires otherwise, the
words "hereof", "herein", and "hereunder" and words of similar import shall
refer to this Agreement as a whole and not to any particular provision of
this Agreement.
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(b) The terms "dollars" and "$" shall mean United States dollars.
(c) The term "including" shall be deemed to mean "including without
limitation."
(d) Article and section headings used in this Agreement are for
convenience of reference only and shall not affect the interpretation of
this Agreement.
(e) This Agreement is among financially sophisticated and
knowledgeable parties and is entered into by the parties in reliance upon
the economic and legal bargains contained herein and shall be interpreted
and construed in a fair and impartial manner without regard to such factors
as the party who prepared, or caused the preparation of, this Agreement or
the relative bargaining power of the parties.
ARTICLE II
GENERAL MATTERS
SECTION 2.1 Formation.
The Members have caused the formation of the Company as a Delaware limited
liability company pursuant to the Delaware Act by filing a Certificate of
Formation of the Company (the "Certificate of Formation") on April 12, 2000 with
the Delaware Secretary of State in accordance with the Delaware Act. The rights
and liabilities of the Members shall be as provided in the Delaware Act, except
as otherwise provided in this Agreement.
SECTION 2.2 Purposes and Business.
Except as may otherwise be approved by the Members, the purpose of the
Company shall be to own and operate the St. Louis Post-Dispatch and other
businesses directly or indirectly related thereto, including certain businesses
contributed to the Company pursuant to the Joint Venture Agreement, as
determined by the Managing Member. The Company shall have all powers necessary
or desirable to accomplish the aforesaid purposes. In connection therewith, the
Company may engage in and enter into any and all activities, contracts and
agreements related or incident to the above-stated purposes as the Managing
Member may determine to be appropriate from time to time. The Company shall have
the power to do all things necessary, appropriate, advisable, convenient, or
incidental in connection with the fulfillment of its business purposes.
SECTION 2.3 Offices.
(a) The principal executive offices of the Company shall be located at
000 Xxxxx Xxxxxx Xxxxxxxxx, Xx. Xxxxx, Xxxxxxxx 00000 at the offices of
Pulitzer or such other location as determined by the Managing Member from
time to time.
(b) The registered office of the Company in the State of Delaware is
located at The Corporation Trust Company, 0000 Xxxxxx Xxxxxx, xx xxx Xxxx
xx Xxxxxxxxxx, Xxxxxx of New Castle. The registered agent of the Company
for service of process at such address is The
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Corporation Trust Company. The Managing Member may change such registered
office or registered agent from time to time.
SECTION 2.4 Name.
The name of the Company shall be St. Louis Post-Dispatch LLC or such other
name as the Managing Member may from time to time select.
SECTION 2.5 Term.
The existence of the Company commenced on the date its Certificate of
Formation was filed with the Secretary of State of the State of Delaware, and
shall continue, unless earlier dissolved and terminated pursuant to Section 8.1,
through the close of business on the fifteenth anniversary of the Closing Date.
SECTION 2.6 Members.
The name and business or mailing address of each Member of the Company are
set forth on Schedule 1 to this Agreement. The Managing Member shall cause
Schedule 1 to be amended from time to time to reflect the addition or retirement
of Members, or transfers of Interests, in accordance with the terms of this
Agreement. Except in connection with a permitted redemption or transfer of a
Member's entire Interest in accordance with the terms of this Agreement, no
Member shall have the right to retire from the Company prior to the termination
of the Company following dissolution and winding up.
ARTICLE III
FINANCIAL AND TAX MATTERS
SECTION 3.1 Capital Contributions.
(a) Simultaneously with the execution of this Agreement, Herald is
contributing to the Company the Herald Contributed Assets and assigning to
the Company the Herald Assumed Liabilities (each as defined and identified
in the Joint Venture Agreement), with an aggregate Agreed Value of
$340,000,000.
(b) Simultaneously with the execution of this Agreement, Pulitzer and
PTI are contributing to the Company the Pulitzer Contributed Assets and the
PTI Contributed Assets, respectively, and are assigning to the Company the
Pulitzer Assumed Liabilities and the PTI Assumed Liabilities, respectively
(each as defined and identified in the Joint Venture Agreement), with an
aggregate Agreed Value of $340,000,000. Of Pulitzer and PTI's $340,000,000
aggregate Capital Contribution, $336,600,000 and $3,400,000 have been
contributed by Pulitzer and PTI, respectively.
(c) The Gross Asset Value of each Contributed Asset which is tangible
property shall be equal to the tax basis thereof as of the date
contributed. The Gross Asset Value of any intangible Contributed Assets
shall be equal to the difference between the total Gross Asset
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Value of such Member's Contributed Assets and the Gross Asset Value of the
tangible Contributed Assets of such Member.
(d) Except as may otherwise be unanimously agreed in writing by the
Members and except for payments, if any, under the Herald Indemnity (which
payments would be treated as Capital Contributions), the Members shall have
no obligation to make any additional Capital Contributions to the Company,
and except as contemplated hereunder or in the Joint Venture Agreement, no
Member shall contribute any property to the Company other than the
Contributed Assets.
SECTION 3.2 Loans from Members.
The Managing Member, in its sole discretion, may permit a Member to advance
funds to the Company as a loan (a "Member Loan"). Member Loans shall not be
considered Capital Contributions. Each Member Loan shall be unsecured and shall
bear a floating rate of interest (adjusted at the beginning of each fiscal
quarter of the Company) equal to the sum of the six month LIBOR rate plus 0.75%
and may contain other customary commercial terms as agreed by the Company and
the Member making such Member Loan; provided, however, that any such Member
Loans shall be fully subordinate in right of payment to the Company Debt, the
Permanent Company Debt, any other indebtedness of the Company and the Herald
Put. A Member Loan shall be a debt of the Company to such Member and shall be
payable or collectible only out of Company assets in accordance with the terms
and conditions upon which such Member Loan is made and subject to the terms and
conditions of this Agreement. The repayment of a Member Loan upon liquidation of
the Company shall be subject to the order of priority set forth in Section 8.2.
Any Member Loan shall provide that any payment of interest or principal thereon
may be made only to the extent that the Reserve Asset Value will equal or exceed
the Minimum Reserve Amount after taking such payment into account.
SECTION 3.3 Restrictions Relating to Capital; Company Property.
(a) Except as otherwise provided herein (including under Section 7.2)
or by the Delaware Act, no Member shall have the right to withdraw, or
receive any return of, all or a portion of such Member's Capital
Contribution, nor shall any Member have the right to demand and receive
property other than cash in return for its Capital Contribution.
(b) No interest shall be paid by the Company on Capital Contributions
or on balances in Members' Capital Accounts.
(c) All Company Property, whether contributed by a Member or otherwise
acquired by the Company, shall be owned by the Company as a separate legal
entity and no Member shall have any right of partition with respect to any
Company Property.
(d) Except as specifically set forth in this Agreement, no Member
shall have priority over any other Member, either as to the return of its
Capital Contribution or as to income, losses, returns, or distributions.
(e) The Company shall not enter into any transaction, other than
transactions contemplated by the Joint Venture Agreement or the Transaction
Agreements, with any Member
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or any Affiliate of any Member (other than any Subsidiaries of the Company)
except on arm's-length terms or otherwise in a manner consistent with prior
practice under the Agency Agreement relating to the kinds of items set
forth in Schedule 2 hereto. The Company shall provide Herald with notice of
any material transaction between the Company and either Pulitzer or any
other Affiliate of Pulitzer (other than any Subsidiary of the Company),
other than a transaction the terms of which are consistent with other prior
practice under the Agency Agreement.
SECTION 3.4 Tax Treatment.
It is the intention of the Members that the Company be treated as a
"partnership" for United States federal, state and local income tax purposes,
and, except as otherwise required by Law, no Member shall take any action
inconsistent with the classification of the Company as a partnership for U.S.
income tax purposes, including any action to cause the Company to be treated as
an association taxable as a corporation for U.S. income tax purposes.
SECTION 3.5 Allocation of Profits and Losses.
Except as provided in Section 3.13, Profits and Losses for any Fiscal Year
or other period shall be allocated among the Members in proportion to their
respective Percentage Interests.
SECTION 3.6 Other Allocation Rules.
(a) Profits, Losses, and any other items of income, gain, loss or
deduction shall be allocated to the Members pursuant to this Article III as
of the last day of each Fiscal Year; provided that Profits, Losses and such
other items shall also be allocated at such times as the Gross Asset Value
of Company Property is adjusted pursuant to Regulations Section
1.704-1(b)(2)(iv)(f). In addition, if any Company Property is distributed
in-kind to a Member, Capital Accounts shall be adjusted as if such Company
Property had been sold for its Fair Market Value at the time of such
distribution.
(b) Profits, Losses and any other items of income, gain, loss or
deduction shall be determined on a daily, monthly or other basis by the
Managing Member, using any permissible method under Code Section 706 and
the Regulations thereunder, and shall be allocated to a particular Fiscal
Year or other period accordingly.
(c) Solely for purposes of determining a Member's proportionate share
of the "excess nonrecourse liabilities" of the Company within the meaning
of Regulations Section 1.752-3(a)(3), the Members' respective interests in
Profits shall be based on their respective Percentage Interests.
SECTION 3.7 Tax Elections.
The Company shall make the following elections on the appropriate tax
returns:
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(a) to have the provisions of subchapter C of Chapter 63 of Subtitle F
of the Code (i.e., Sections 6221 through 6234 of the Code and the
Regulations thereunder regarding the tax treatment of partnership
items) apply to the Company;
(b) to adjust the basis of Company Property in the circumstances
described in Section 754 of the Code; and
(c) any other election not inconsistent with this Agreement or the
Joint Venture Agreement that the Tax Matters Member may deem appropriate
and in the best interest of the Company and the Members.
Neither the Company nor any Member may make an election for the Company to
be excluded from the application of the provisions of subchapter K of chapter 1
of subtitle A of the Code or any similar provisions of applicable state Law.
Herald agrees not to extend the statute of limitations with respect to
partnership items (as defined in Section 6231 of the Code) of the Company unless
an extension specific to such items is expressly requested by the Internal
Revenue Service. At the request of the Managing Member, Herald will confirm to
the Managing Member whether any such statute of limitations has been extended
and the date to which any such statute of limitations has been extended.
SECTION 3.8 Tax Allocations; Code Section 704(c).
(a) In accordance with Code Section 704(c) and the Regulations
thereunder, income, gain, loss, and deduction with respect to any Company
Property contributed to the Company by a Member, including any Contributed
Asset, shall, solely for tax purposes, be allocated among the Members so as
to take account of any variation between the adjusted tax basis of such
Company Property to the Company for federal income tax purposes and its
Gross Asset Value at the time of contribution. Allocations pursuant to this
Section 3.8 are solely for purposes of federal, state and local income
taxes and shall not be taken into account in computing any Member's share
of Profits, Losses or distributions pursuant to any provision of this
Agreement.
(b) The Company shall adopt and use only the "traditional method"
permitted by the Regulations under Code Section 704(c), and therefore shall
not make any curative allocations and/or remedial allocations.
(c) Except as otherwise provided in this Agreement, all items of
Company income, gain, loss, deduction and any other items taken into
account in computing Profits and Losses for a particular Fiscal Year or
other period shall be allocated among the Members based on their respective
Percentage Interests for such Fiscal Year or other period as determined by
the Managing Member in accordance with applicable provisions of the Code
and Regulations.
(d) Except as otherwise provided above, all Company allocations shall
be made in accordance with Section 704(b) of the Code.
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SECTION 3.9 Tax Matters Member.
Pulitzer shall be the tax matters partner (the "Tax Matters Member") of the
Company pursuant to Section 6231(a)(7) of the Code. The Company agrees to
defend, indemnify and hold harmless the Tax Matters Member from and against all
claims, damages, costs and expenses relating to actions taken in good faith in
discharging its responsibilities as Tax Matters Member.
SECTION 3.10 Regular Distribution Policy.
(a) Subject to Section 3.11, the Managing Member shall determine from
time to time, in its complete discretion, whether and to what extent the
Company shall distribute any portion of Company Property to the Members in
cash; provided, however, that, except as provided in Section 3.11, the
Company shall not make any distribution to the extent that, after giving
effect to such distribution, the Reserve Asset Value would be less than the
Minimum Reserve Amount.
(b) All distributions (other than pursuant to Section 3.11, Section
7.2 or Section 8.2) of Company Property shall be made to the Members based
on their respective Percentage Interests.
(c) The Members acknowledge that distributions pursuant to this
Section 3.10 in excess of the Company's "net cash flow from operations," as
determined under Regulations Section 1.707-4(b), are not anticipated on or
before the second anniversary of the Closing Date.
SECTION 3.11 Special Distributions.
(a) Simultaneous with the Closing, the Company shall distribute to
Herald $306,000,000.
(b) Notwithstanding Section 3.10, in the event of an increase in the
tax basis of Company Property (other than any increase in tax basis under
Section 743 of the Code) by reason of a Final Determination resulting in an
increase in the taxable income of Herald attributable to its Interest,
including as a result of a Final Determination that Herald's contribution
of its Contributed Assets constituted a taxable sale for federal income tax
purposes as of the date it was made, the Company shall distribute to Herald
an amount equal to 100% of the "Deemed Tax Benefit" (as defined in the next
sentence) arising as a result of such increase in the tax basis of Company
Property. The "Deemed Tax Benefit" of any increase in the tax basis of
Company Property shall be equal to the present value, computed based on an
8% annual discount rate to the date on which such increase in tax basis
applies for tax purposes, of a series of 15 annual amounts, each equal to
39% of one-fifteenth of such increase in tax basis, with such amounts being
taken into account commencing on the last day of the first tax year to
which such increase in tax basis is applicable and continuing on the last
day of each of the following 14 consecutive tax years.
(c) Notwithstanding anything herein to the contrary, no distribution
shall be made to Herald pursuant to Section 3.11(b) either prior to the day
after the second anniversary of the Closing Date or subsequent to the
exercise of the Herald Put.
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SECTION 3.12 Permanent Company Debt.
The Company shall refinance the Company Debt (or Permanent Company Debt)
from time to time with non-amortizing indebtedness that remains outstanding for
an aggregate term (taking into account the initial refinancing and any
subsequent refinancings) expiring on or after the 15th anniversary of the
Closing Date. The principal amount of any Permanent Company Debt shall be not
less than the Company Debt and not more than the sum of (i) the principal amount
of the Company Debt, plus (ii) the aggregate amount of expenses incurred in
obtaining any Permanent Company Debt. After deducting such expenses, the net
proceeds of any Permanent Company Debt shall be used solely to repay in full the
principal amount of the Company Debt (or, in the case of refinancings of
Permanent Company Debt, such refinanced Permanent Company Debt). The terms of
any Company Debt and Permanent Company Debt shall not restrict any distribution
by the Company under Section 3.11(b) or the payment by the Company of the Put
Price.
SECTION 3.13 Allocations Upon Liquidation of the Company.
In connection with the liquidation of the Company pursuant to Section 8.2,
any income or gain realized upon liquidation shall be allocated among the
Members based on their respective Percentage Interests pursuant to Section 3.5;
provided, however, that Herald's share of any such income or gain shall be
reduced, but not below 1% of all such income and gain, to the extent that the
allocations of income and gain to Herald in connection with the liquidation of
the Company would cause the Deemed Value of Herald's Interest to exceed $325
million as of the Closing Date.
SECTION 3.14 Reimbursement of Certain Expenses.
The Company will be responsible for and shall pay or reimburse any Member
or any Affiliate of a Member for any expenses (including reasonable attorney
fees) incurred by such Person in contesting or litigating any matter arising out
of (x) the actions or activities of the Company or (y) the transactions
contemplated by the Joint Venture Agreement (including the costs of any tax
contests, but not the tax, interest or penalties related thereto); provided,
that in the case of any Member other than the Managing Member, such Member shall
give the Company prompt written notice of any matter which may give rise to any
claim that the Company is responsible for any payment or reimbursement under
this Section 3.14.
ARTICLE IV
MANAGEMENT
SECTION 4.1 General.
The Managing Member shall have the sole right to manage the business of the
Company and shall have all powers and rights necessary, appropriate or advisable
to effectuate and carry out the purposes and business of the Company, including
the appointment of officers of the Company and the delegation thereto of such
duties as the Managing Member deems necessary, appropriate or advisable. The
Managing Member shall constitute and shall have all of
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the rights of a "manager" of the Company as such term is defined in Section
18-101 of the Delaware Act. No other Member, by reason of its status as such,
shall have any authority to act for or bind the Company or otherwise take part
in the management of the Company, but shall have only the right to vote on or
approve the matters specifically provided herein or required in the Delaware Act
to be voted on or approved or determined by the Members.
SECTION 4.2 Standard of Care; Indemnification.
(a) In carrying out their duties, each Member (including the Managing
Member) and its respective directors, officers and agents and the officers
or agents of the Company (each, an "Indemnitee") shall not be liable to the
Company or to any Member for any actions taken in good faith and reasonably
believed by the Indemnitee to be in, or not opposed to, the best interests
of the Company, or for errors of judgment, neglect or omission, including
any losses sustained, liabilities incurred, or benefits not derived by
Members in connection with any action or inaction of the Indemnitee,
provided, however, that the Indemnitee shall be liable for his willful
misconduct or fraud.
(b) Each Indemnitee shall be indemnified and held harmless by the
Company from and against any and all losses, claims, damages, liabilities,
expenses (including legal fees and disbursements), judgments, fines,
settlements and all other amounts arising from any and all claims, demands,
actions, suits or proceedings, civil, criminal, administrative or
investigative, in which the Indemnitee may be involved, or threatened to be
involved, as a party or otherwise by reason of the Indemnitee's status as
the Managing Member or his status as a director, officer or agent of the
Managing Member or of the Company and his management of the affairs of the
Company, or which relate to the Company, its property, business or affairs,
whether or not the Indemnitee continues to be the Managing Member or a
director, officer or agent of the Managing Member or of Company at the time
any such liability or expense is paid or incurred, if the Indemnitee acted
in good faith and in a manner it or he reasonably believed to be in, or not
opposed to, the best interests of the Company.
(c) Expenses (including legal fees and disbursements) incurred in
defending any proceeding shall be paid by the Company in advance of the
final disposition of such proceeding upon receipt of an undertaking by or
on behalf of the Indemnitee to repay such amount if it is ultimately
determined by a court of competent jurisdiction that the Indemnitee is not
entitled to be indemnified by the Company as authorized hereunder.
SECTION 4.3 Capital Expenditures.
The Managing Member may cause the Company to incur capital
expenditures, and may fund any such capital expenditures out of the assets of
the Company or out of funds provided by Member Loans; provided, that the Company
may not fund a capital expenditure out of the assets of the Company unless,
after the expenditure, the Reserve Asset Value is at least equal to the Minimum
Reserve Amount.
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SECTION 4.4 Reserves.
The Managing Member may establish and maintain reserves for actual,
anticipated or contingent liabilities and obligations of the Company. The
Company may pledge its cash and U.S. Treasury obligations and other obligations
backed by the full faith and credit of the United States, but only to the extent
the value of such cash, U.S. Treasury obligations and other obligations backed
by the full faith and credit of the United States exceed the Minimum Reserve
Amount at such time. The Company may not incur any obligations which are
reasonably expected to cause the Reserve Asset Value to be less than the Minimum
Reserve Amount.
ARTICLE V
ACCOUNTING, BOOKS AND RECORDS
SECTION 5.1 Fiscal Year.
The Fiscal Year and fiscal periods of the Company shall be the same as the
fiscal year and fiscal periods of Pulitzer, as the same may be changed or
modified from time to time.
SECTION 5.2 Books and Records.
The Company shall keep the books and records of the Company at its
principal executive offices. Such books and records shall be kept in conformity
with accounting principles generally accepted in the United States of America.
Each of the Members and its authorized representatives shall have the right, at
all reasonable times and upon reasonable advance written notice to the Company,
at such Member's expense, to inspect, audit and copy the books and records of
the Company for any purpose reasonably related to the Member's Interest. A
Member requesting access to the Company's books and records shall reimburse the
Company for any costs reasonably incurred by the Company in connection
therewith.
SECTION 5.3 Auditors.
The CPA Firm of the Company shall be designated by the Managing Member and
such CPA Firm may be changed from time to time so long as it is an auditing firm
of international standing.
SECTION 5.4 Reporting.
The Company shall use reasonable commercial efforts to deliver to each
Member (i) within 30 days after the close of each fiscal month, an unaudited
balance sheet and statement of income for the Company for such fiscal month and
(ii) within one-hundred twenty (120) days after the close of each Fiscal Year,
an audited balance sheet, statement of income and statement of cash flows for
the Company for such Fiscal Year.
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SECTION 5.5 Banking.
All funds of the Company received from any and all sources shall be
deposited in such checking or other such accounts as shall be determined by the
Managing Member. In connection with the maintenance of such bank accounts, the
Managing Member shall designate those individuals who will have authority to
write checks or otherwise disburse funds from such bank accounts on behalf of
the Company in connection with its activities.
SECTION 5.6 Tax Return Information.
The Managing Member shall cause the Company to prepare all federal,
foreign, state and local income tax returns that it is required to file. The
Managing Member shall use reasonable commercial efforts to deliver to each
Member within 120 days following the close of each Fiscal Year such tax
information as shall reasonably be required for the preparation by such Person
of its federal, foreign, state and local income and other income tax returns.
For each taxable year of the Company with respect to which Herald owns an
Interest, the Managing Member shall provide Herald with a copy of the draft
federal income tax return of the Company for such year at least twenty (20) days
prior to the filing of such return for comment and consultation, provided that
Herald's approval shall not be required for the filing of any tax return of the
Company.
SECTION 5.7 Six Year Projections.
Within thirty (30) days following the ninth anniversary of the Closing
Date, the Managing Member shall cause the Company to deliver to Herald projected
balance sheets, statements of income and statements of cash flow of the Company
for the six annual periods beginning on the ninth anniversary of the Closing
Date. The projections shall set forth all underlying material assumptions in
respect thereof, and the Company shall make available representatives of the
Company and the Managing Member to review the projections with representatives
of Herald.
ARTICLE VI
CONFIDENTIALITY; NONCOMPETITION
SECTION 6.1 Confidentiality Obligation.
Herald shall not, directly or indirectly, disclose or use at any time any
confidential or proprietary business, financial or other information pertaining
to the Company, Pulitzer or any of its respective Affiliates.
SECTION 6.2 Noncompetition.
Notwithstanding anything herein to the contrary, the parties hereto agree
that neither Herald nor any of its Affiliates shall, directly or indirectly,
during the term of this Agreement (a) own, operate, publish, sell or distribute
any daily, general interest newspaper that is principally sold or distributed
within the greater St. Louis metropolitan area or (b) purchase any group of
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weekly newspapers (regardless of their frequency of publication within any week)
consisting of five or more weeklies with aggregate weekly circulation of more
than 175,000 copies that are principally sold or distributed within the greater
St. Louis metropolitan area.
ARTICLE VII
TRANSFER OF INTERESTS; PUT RIGHT
SECTION 7.1 General.
(a) Any Member may sell, assign or transfer (collectively, "Transfer")
all or any portion of its Interest to any of its Affiliates that would be
treated as a "related person" to such Member within the meaning of
Regulations Section 1.752 (any such Affiliates of such Member, a "Related
Person") without the consent of any other Member, but may not Transfer,
pledge or otherwise encumber all or any portion of its Interest to any
Person who is not a Related Person to such Member (or take or allow to be
taken any action as a result of which the Related Person is no longer an
Affiliate of such Member) without the prior written consent of the other
Members, which consent may be granted or withheld in the other Members'
sole discretion.
(b) Notwithstanding Section 7.1(a), Pulitzer may, without the consent
of any other Member, Transfer all, but not less than all, of its and its
Affiliates' Interests, together with all of their obligations, to any
Person and designate that Person to be the Managing Member of the Company;
provided, that such Transferee (i) is, or is an Affiliate of, a nationally
recognized daily newspaper publisher which, together with its Affiliates,
has an aggregate paid daily circulation equal to at least 3,000,000 copies,
(ii) has a net worth at least equal to Pulitzer's net worth at such time,
(iii) assumes Pulitzer's obligations under this Agreement and the
Transaction Agreements and (iv) assumes Pulitzer's obligations under the
Pulitzer Guaranty (as defined in the Joint Venture Agreement).
(c) Notwithstanding Section 7.1(a), Pulitzer may, without the consent
of any other Member, Transfer all, but not less than all, of its and its
Affiliates Interests, together with all of their obligations, to any Person
and designate that Person to be the Managing Member of the Company;
provided, that (i) such Transferee is, or is an Affiliate of, a nationally
recognized daily newspaper publisher which, together with its Affiliates,
has an aggregate paid daily circulation of at least 500,000 copies, (ii)
such Transferee or its ultimate parent has "investment grade" rated debt,
as determined by either Standard & Poor's or Xxxxx'x, or, if such
Transferee's or its ultimate parent's debt is not so rated, such Transferee
or its ultimate parent (calculated on a consolidated basis) has a debt to
EBITDA ratio of not more than 3.5 to 1, (iii) such Transferee assumes
Pulitzer's obligations under this Agreement and the Transaction Agreements,
(iv) such Transferee assumes Pulitzer's obligations under the Pulitzer
Guaranty and (v) if such Transferee satisfies either condition under the
foregoing subsection (ii) only because its ultimate parent satisfies such
condition, the ultimate parent of such Transferee shall guarantee its
performance of Pulitzer's obligations under this Agreement and the
Transaction Agreements and also Pulitzer's obligations under the Pulitzer
Guaranty.
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(d) PTI must Transfer all of its Interest to the Person (or to an
Affiliate of the Person) to whom Pulitzer may Transfer its Interest under
Section 7.1(b) or Section 7.1(c)
(e) Any purported Transfer by a Member which does not comply with the
provisions of this Section 7.1 shall be null and void and of no force and
effect. Any Transferee under this Section 7.1 shall become a substitute
member in the Company, and shall take the place of the Transferor under
this Agreement as fully and completely as if such Transferee had been a
party hereto, provided that such Transferee executes and delivers to the
Company such documents and instruments of conveyance as may be reasonably
necessary to effect such Transfer and to confirm the agreement of the
Transferee to be bound by the provisions of this Agreement and the
Transaction Agreements.
SECTION 7.2 Put Right.
(a) Upon not less than six months prior written notice and, provided
that Herald and its Affiliates are not in breach of any of the Put-Related
Covenants, Herald shall have a one-time right to require the Company to
redeem all (but not less than all) of its Interest, effective on the tenth
anniversary of the Closing Date (the "Herald Put"). The redemption price
(the "Put Price") for Herald's Interest will be the amount necessary to
result in the Deemed Value of the Herald Interest after receipt of such
payment being equal to $275 million as of the Closing Date; provided,
however, that if, at the time the Herald Put is exercised, a contest with a
governmental authority exists as to the tax treatment of any item of income
taken into account in computing Deemed Value, the Put Price will be
adjusted after the closing of the exercise of the Herald Put to reflect the
ultimate tax treatment as well as any additional unreimbursed contest costs
and penalties of Herald and its Affiliates and the corrected interest
calculation. The Company may, in the Managing Member's sole and absolute
discretion, assign its obligations under the Herald Put to Pulitzer. The
closing of the exercise of the Herald Put shall take place at a time and
place to be designated by mutual agreement of the Company and Herald, but
not later than thirty (30) days after the tenth anniversary of the Closing.
At the closing, Herald shall execute and deliver such documents as
reasonably requested by the Company or Pulitzer to fully transfer title to
its Interest, including documents representing and warranting good and
marketable title to its Interest and that its Interest is owned free and
clear of all liens, charges and encumbrances.
SECTION 7.3 Termination of a Member's Interest.
Any Member that Transfers its entire Interest pursuant to the terms hereof
shall be deemed to have retired and to have ceased to be a Member as of the
effective date of such Transfer.
ARTICLE VIII
DISSOLUTION AND WINDING UP
SECTION 8.1 Dissolution.
The Company shall be dissolved and its affairs wound up and terminated upon
the first to occur of the following:
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(a) the expiration of its term as set forth in Section 2.5; and
(b) the unanimous written consent of the Members to dissolve the
Company.
SECTION 8.2 Winding Up.
If the Company is dissolved pursuant to Section 8.1, this Agreement shall
remain in full force and effect and shall continue to govern the rights and
obligations of the Members and the Managing Member and the conduct of the
Company during the period of winding up the Company's affairs. Except as
provided in Section 8.3 below, the Managing Member shall cause Company Property
to be distributed in-kind or to be sold for cash and the proceeds distributed as
provided herein. The Managing Member shall apply and distribute Company Property
in the following order of priority (subject to Section 8.3), unless otherwise
required by mandatory provisions of applicable Law:
(a) to repayment of the Company Debt or the Permanent Company Debt;
(b) to repayment of other creditors (other than Members who are
creditors), to the extent otherwise permitted by Law, in satisfaction of
the liability of the Company to such creditors (whether by payment, by the
establishment of reserves of cash or other Company Property for contingent
liabilities in amounts, if any, determined by the Managing Member to be
appropriate for such purposes or by other reasonable provision for
payment);
(c) to repayment of Member Loans (whether by payment, by the
establishment of reserves of cash or other Company Property for contingent
liabilities in amounts, if any, determined by the Managing Member to be
appropriate for such purposes or by other reasonable provision for
payment); and
(d) thereafter to the Members in proportion to the positive balances
of their respective Capital Accounts. Such Capital Account balances shall
be determined after allocating all income, gain, deduction, loss and other
like items arising in connection with the liquidation of Company Property
(or if Company Property is not sold, after adjusting the Capital Accounts
in the same manner as such accounts would have been adjusted if all Company
Property had been sold for its Fair Market Value) and otherwise making all
Capital Account adjustments required hereunder. No Member shall have any
obligation to restore any deficit in its Capital Account.
SECTION 8.3 Pulitzer Purchase.
In connection with the liquidation of the Company, Pulitzer
will pay to Herald, in lieu of any amount that otherwise would be distributed to
Herald pursuant to Section 8.2(d), cash in the same amount.
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ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Notices.
All notices and other communications required or permitted by this
Agreement shall be in writing and shall be delivered by personal delivery, by
nationally recognized overnight courier service, by facsimile, by first class
mail or by certified or registered mail, return receipt requested, addressed to
any Member at its address as set forth on Schedule 1 (as the same may be updated
from time to time at the direction of such Member) or to the Company at 000
Xxxxx Xxxxxx Xxxxxxxxx, Xx. Xxxxx, Xxxxxxxx 00000 (or to such other address as
the Company shall have designated to each of the Members by written notice given
in the manner hereinabove set forth). Notices shall be deemed given one day
after sent, if sent by overnight courier; when delivered and receipted for, if
hand delivered; when received, if sent by facsimile or other electronic means or
by first class mail; or when receipted for (or upon the date of attempted
delivery where delivery is refused or unclaimed), if sent by certified or
registered mail, return receipt requested.
SECTION 9.2 Amendment; Waiver.
Any provision of this Agreement may (i) be amended if, and only if, such
amendment is in writing and signed by each Member, or (ii) be waived if such
waiver is contained in a writing, and signed by the party against whom the
waiver is to be effective. No failure or delay by any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof nor shall
any single exercise thereof preclude any other or further exercise thereof or of
any other right, power or privilege. Except as otherwise provided, rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by Law.
SECTION 9.3 Assignment.
Except as otherwise expressly provided herein, no party to this Agreement
may assign any of its rights or obligations under this Agreement without the
prior written consent of the other parties hereto.
SECTION 9.4 Entire Agreement.
This Agreement, the Joint Venture Agreement and the Transaction Agreements
(including the schedules and exhibits hereto and thereto) contain the entire
agreement among the parties hereto with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral or written, with respect
to such matters.
SECTION 9.5 Parties in Interest.
This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns or
Transferees. Nothing in this
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Agreement, express or implied, is intended to confer upon any Person other than
the Company, Herald, Pulitzer, PTI or their respective successors or permitted
assigns or Transferees, any rights or remedies under or by reason of this
Agreement. The Company is executing this Agreement as a party, and this
Agreement shall constitute a contract among the Members and between the Company
and each of the Members.
SECTION 9.6 Governing Law; Submission to Jurisdiction; Selection of Forum.
This Agreement shall be governed by, and construed and enforced in
accordance with, the Laws of the State of Delaware without giving effect to any
choice of law provision or rule (whether of the State of Delaware or any other
jurisdiction) that would cause the application of the Laws of any jurisdiction
other than the internal Laws of the State of Delaware. Each of the parties
agrees that any legal action between the parties, or any of them, relating to
this Agreement, the interpretation of the terms hereof or the performance hereof
or the consummation of the transactions contemplated hereby, whether in tort or
contract or at law or in equity, shall exclusively be brought in a Federal or
State Court located in New Castle County, Delaware, having jurisdiction of the
subject matter thereof, and each party irrevocably (i) consents to personal
jurisdiction in any such Federal or State Court, (ii) waives any objection to
laying venue in any such action or proceeding in any such Court, (iii) waives
any immunity from suit and any objection that any such Court is an inconvenient
forum or does not have jurisdiction over any party hereto and (iv) agrees that
service of complaint or other process may be made by certified or registered
mail addressed to such party at its address determined in accordance with
Section 9.1 of this Agreement.
SECTION 9.7 Counterparts.
This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original, and all of which shall constitute one and the same
Agreement.
SECTION 9.8 Severability.
The provisions of this Agreement shall be deemed severable and the
invalidity or unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof. If any provision of this
Agreement, or the application thereof to any Person or any circumstance, is
invalid or unenforceable (i) a suitable and equitable provision shall be
substituted therefor in order to carry out, so far as may be valid and
enforceable, the intent and purpose of such invalid or unenforceable provision,
and (ii) the remainder of this Agreement and the application of such provision
to other Persons or circumstances shall not be affected by such invalidity or
unenforceability, nor shall such invalidity or unenforceability affect the
validity or enforceability of such provision, or the application thereof, in any
other jurisdiction. If Herald and Pulitzer are unable to agree on the
substitution of a provision pursuant to clause (i) above, such dispute shall be
submitted to binding arbitration in accordance with the rules of the American
Arbitration Association.
SECTION 9.9 No Agency.
This Agreement shall not constitute an appointment of any party as the
agent of any other party, nor shall any party have any right or authority to
assume, create or incur in any
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manner any obligation or other liability of any kind, express or implied,
against, or in the name or on behalf of, any other party.
SECTION 9.10 Limitation of Liability.
The debts, obligations and liabilities of the Company, whether arising in
contract, tort or otherwise, shall be solely the debts, obligations and
liabilities of the Company, and, except as otherwise expressly provided herein,
no Member (including the Managing Member) or officer of the Company shall be
obligated personally for any such debt, obligation or liability of the Company
solely by reason of being a Member, Managing Member and/or officer.
[The remainder of this page is intentionally left blank]
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IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of
the date first written above.
PULITZER INC.
By:/S/ XXXXXX X. XXXXXXX
---------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President - Finance
PULITZER TECHNOLOGIES, INC.
By:/S/ XXX X. XXXX
---------------
Name: Xxx X. Xxxx
Title: Treasurer
THE HERALD COMPANY, INC.
By:/S/ X.X. XXXXXXXX, JR.
----------------------
Name: X.X. Xxxxxxxx, Jr.
Title: Vice President
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