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EXHIBIT 10.5
STOCKHOLDERS AGREEMENT
STOCKHOLDERS AGREEMENT, dated as of September 26, 1996 (this
"Agreement"), by and among The Providence Journal Company, a Delaware
corporation (the "Company"), and each of the other parties signatory hereto
(each a "Stockholder" and, collectively, the "Stockholders").
W I T N E S S E T H:
WHEREAS, concurrently herewith, the Company, A.H. Belo Corporation, a
Delaware corporation ("Acquiror"), and A H Finance Company, a Delaware
corporation and a direct wholly-owned subsidiary of Acquiror ("Sub"), are
entering into an Agreement and Plan of Merger (as such agreement may hereafter
be amended from time to time, the "Merger Agreement"; initially capitalized and
other terms used but not defined herein shall have the meanings ascribed to
them in the Merger Agreement), pursuant to which the Company will be merged
with and into Sub (the "Merger");
WHEREAS, each of the Stockholders Beneficially Owns (as defined
herein) the number of shares, par value $1.67 per share, of Series A and/or
Series B Common Stock of Acquiror (the "Shares" or "Acquiror Common Stock") set
forth opposite such Stockholder's name on Schedule I hereto;
WHEREAS, as an inducement and a condition to entering into the Merger
Agreement, the Company has required that the Stockholders agree, and the
Stockholders have agreed, to enter into this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual
premises, representations, warranties, covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. Provisions Concerning Acquiror Common Stock. Each Stockholder
hereby agrees with the Company that, during the period commencing on the date
hereof and continuing until the first to occur of the Effective Time and
termination of the Merger Agreement in accordance with its terms, at any
meeting of Acquiror's stockholders, however called, or in connection with any
written consent of Acquiror's stockholders, such Stockholder shall vote (or, in
the case of joint ownership, use all reasonable efforts to cause to be voted)
the Shares Beneficially Owned (as defined below) by such Stockholder, whether
heretofore owned or hereafter acquired, (i) in favor of the issuance of shares
of Series A Common Stock of Acquiror (the "Series A Stock") pursuant to the
Merger Agreement and any actions required in furtherance thereof and hereof;
(ii) against any action or agreement that would result in a breach in any
respect of any covenant, representation or warranty or any other obligation or
agreement of
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Acquiror under the Merger Agreement (after giving effect to any materiality or
similar qualifications contained therein); and (iii) except as otherwise agreed
to in writing in advance by the Company, against any changes in a majority of
the persons who constitute the board of directors of Acquiror. Such
Stockholder shall not enter into any agreement or understanding with any person
the effect of which would be inconsistent or violative of the provisions and
agreements contained in Section 1 or 2 hereof. For purposes of this Agreement,
"Beneficially Own" or "Beneficial Ownership" with respect to any securities
shall mean a person's having direct ownership of and the right to vote such
securities in his or her individual capacity.
2. Other Covenants, Representations and Warranties. Each
Stockholder hereby represents and warrants to the Company as follows:
(a) Ownership of Shares. Such Stockholder is the record and
Beneficial Owner of the number of Shares set forth opposite such Stockholder's
name on Schedule I hereto. On the date hereof, the Shares set forth opposite
such Stockholder's name on Schedule I hereto constitute all of the Shares
Beneficially Owned by such Stockholder. Such Stockholder has sole voting power
with respect to the matters set forth in Section 1 hereof with respect to all
of the Shares set forth opposite such Stockholder's name on Schedule I hereto
with no limitations, qualifications or restrictions on such rights.
(b) Power; Binding Agreement. Such Stockholder has the legal
capacity, power and authority to enter into and perform all of such
Stockholder's obligations under this Agreement. The execution, delivery and
performance of this Agreement by such Stockholder will not violate any law,
regulation or court order or any other agreement to which such Stockholder is a
party including, without limitation, any voting agreement, Stockholder
agreement or voting trust. This Agreement has been duly and validly executed
and delivered by such Stockholder and constitutes a valid and binding agreement
of such Stockholder, enforceable against such Stockholder in accordance with
its terms. If such Stockholder is married and such Stockholder's Shares
constitute community property, this Agreement has been duly authorized,
executed and delivered by, and constitutes a valid and binding agreement of,
such Stockholder's spouse, enforceable against such person in accordance with
its terms.
(c) Restriction on Transfer, Proxies and Non-Interference. Such
Stockholder shall not, directly or indirectly: (i) except as contemplated by
the Merger Agreement, offer for sale, sell, transfer, tender, pledge, encumber,
assign or otherwise dispose of, or enter into any contract, option or other
arrangement or understanding with respect to or consent to the offer for sale,
sale, transfer, tender, pledge, encumbrance, assignment or other disposition
of, any or all of such Stockholder's Shares or any interest therein; (ii) grant
any proxies or powers of attorney, deposit any Shares into a voting trust or
enter into a voting agreement with respect to any Shares; or (iii) take any
action that would make any representation or warranty of such Stockholder
contained herein untrue or incorrect or have the effect of preventing or
disabling such Stockholder from performing such Stockholder's obligations under
this Agreement; provided, however, that, notwithstanding clause (i) of this
sentence, (x) such Stockholder shall be permitted to transfer any of such
Stockholder's Shares to a trust or similar entity for estate planning purposes
so long as such Stockholder retains, or another Stockholder acquires, (1) sole
power to vote such Shares
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(and votes such Shares in accordance with this Agreement) and (2) investment
power over such shares (and causes such trust or similar entity to retain such
Shares until the termination of this Agreement); (y) such Stockholder shall be
permitted to make one or more gifts or charitable donations of such Shares up
to such number of Shares as represents no more than 10% of the voting power
represented by the aggregate number of such Stockholder's Shares on the date
hereof; and (z) such Stockholder may pledge or margin any of such Stockholder's
Shares so long as such Stockholder retains sole power to vote such Shares (and
votes in accordance with this Agreement) for the term of this Agreement
(provided that such pledge or margin transaction shall be made only to or with
a financial institution extending credit to such Stockholder in the ordinary
course of such financial institution's business and unrelated to any
transaction or transactions involving an attempt to acquire control of the
Company).
(d) Reliance by the Company. Such Stockholder understands and
acknowledges that the Company is entering into the Merger Agreement in reliance
upon such Stockholder's execution and delivery of this Agreement.
3. Stop Transfer. Each Stockholder agrees with, and covenants
to, the Company that such Stockholder shall not request that Acquiror register
the transfer (book-entry or otherwise) of any certificate or uncertificated
interest representing any of such Stockholders' Shares, unless such transfer is
made in compliance with this Agreement. In the event of a stock dividend or
distribution, or any change in the Acquiror Common Stock by reason of any stock
dividend, split-up, recapitalization, combination, exchange of shares or the
like, the term "Shares" shall be deemed to refer to and include the Shares as
well as all such stock dividends and distributions and any shares into which or
for which any or all of the Shares may be changed or exchanged.
4. Termination. Except as otherwise provided herein, the
covenants and agreements contained herein with respect to the Shares shall
terminate upon the earlier of (a) the termination of the Merger Agreement in
accordance with its terms and (b) the Effective Time.
5. Stockholder Capacity. No person executing this Agreement who
is or becomes during the term hereof a director of Acquiror or a trustee of a
trust makes any agreement or understanding herein in his or her capacity as
such director or trustee. Each Stockholder signs solely in his or her capacity
as the Beneficial Owner of such Stockholder's Shares.
6. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and
oral, among the parties with respect to the subject matter hereof.
(b) Certain Events. Each Stockholder agrees that this Agreement
and the obligations hereunder shall attach to such Stockholder's Shares and
shall be binding upon any person to which legal or beneficial ownership of such
Shares shall pass, whether by operation of law or otherwise. Notwithstanding
any transfer of Shares, the transferor shall remain liable for the performance
of all obligations under this Agreement of the transferor.
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(c) Assignment. This Agreement shall not be assigned by operation
of law or otherwise without the prior written consent of the other party.
(d) Amendments, Waivers, Etc. This Agreement may not be amended,
changed, supplemented, waived or otherwise modified or terminated, with respect
to any one or more Stockholders, except upon the execution and delivery of a
written agreement executed by the relevant parties hereto; provided, however,
that Schedule I hereto may be supplemented by the Company and one or more
stockholders of Acquiror by adding the name and other relevant information
concerning any stockholder of the Company who agrees to be bound by the terms
of this Agreement without the agreement of any other party hereto, and
thereafter such added stockholder shall be treated as a "Stockholder" for all
purposes of this Agreement.
(e) Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telegram,
telex or telecopy, or by mail (registered or certified mail, postage prepaid,
return receipt requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall be delivered
to the respective parties at the following addresses:
If to any Stockholder: At the address set forth
on Schedule I hereto
with a copy to: Xxxxxxx X. XxXxxxxx, Esq.
Senior Vice President and General Counsel
A.H. Belo Corporation
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: E. Xxxxxxx Xxxxxxx, Esq.
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If to the Company: The Providence Journal Company
00 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxx and
Xxxx X. Xxxxxxx, Esq.
with a copy to: Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxx, Esq.
and
Xxxxxxx & Xxxxxx
0000 Xxxxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxx X.X. Xxxx, Esq.
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the matter set forth above.
(f) Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such jurisdiction, and this
Agreement will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision or portion of any provision
had never been contained herein.
(g) Specific Performance. Each of the parties hereto recognizes
and acknowledges that a breach by it of any covenants or agreements contained
in this Agreement will cause the other party to sustain damage for which it
would not have an adequate remedy at law for money damages, and therefore each
of the parties hereto agrees that in the event of any such breach the aggrieved
party shall be entitled to the remedy of specific performance of such covenants
and agreements and injunctive and other equitable relief in addition to any
other remedy to which it may be entitled, at law or in equity.
(h) No Waiver. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in
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equity, or to insist upon compliance by any other party hereto with its
obligations hereunder, and any custom or practice of the parties at variance
with the terms hereof, shall not constitute a waiver by such party of its right
to exercise any such or other right, power or remedy or to demand such
compliance.
(i) Governing Law. This Agreement shall be governed and construed
in accordance with the laws of the State of Delaware, without giving effect to
the principles of conflicts of law thereof.
(j) Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, but all of which, taken
together, shall constitute one and the same Agreement.
IN WITNESS WHEREOF, the Company and each Stockholder have caused this
Agreement to be duly executed as of the day and year first above written.
THE PROVIDENCE JOURNAL COMPANY
By: /s/ XXXXXXX XXXXXXXX
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Name: Xxxxxxx Xxxxxxxx
Title: Chairman of the Board, Chief
Executive Officer and Publisher
STOCKHOLDERS:
/s/ XXXXXX X. XXXXXXX
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Xxxxxx X. Xxxxxxx
/s/ XXXXXXX X. XXXXXXX
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Xxxxxxx X. Xxxxxxx
/s/ DEALEY X. XXXXXXX
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Dealey X. Xxxxxxx
/s/ XXXXX X. XXXXXXX, XX.
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Xxxxx X. Xxxxxxx, Xx.
/s/ XXXXX XXXXXX XXXXXXX XXXXXXX
-------------------------------------------
Xxxxx Xxxxxx Xxxxxxx Xxxxxxx
/s/ XXXX X. XXXXXXX, XX.
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Xxxx X. Xxxxxxx, Xx.
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ACKNOWLEDGED AND AGREED TO
(with respect to Section 3):
A.H. BELO CORPORATION
By: /s/ XXXXXX X. XXXXXXX
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Name: Xxxxxx X. Xxxxxxx
Title: Chairman of the Board, President
and Chief Executive Officer
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Schedule I to
Stockholders Agreement
Name and Address Number of Shares Owned
---------------- ----------------------
Series A Series B
-------- --------
Xxxxxx X. Xxxxxxx 583,509 1,972,908
A.H. Belo Corporation
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Dealey X. Xxxxxxx 1,048,146 1,305,624
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Xxxxx X. Xxxxxxx, Xx. 494,235 154,922
A.H. Belo Corporation
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Xxxx X. Xxxxxxx, Xx. 3,200 3,200
A.H. Belo Corporation
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
