Central European Media Enterprises Ltd.
$125,000,000 Principal Amount of
% Convertible Subordinated Notes Due 2004
----------------------
UNDERWRITING AGREEMENT
----------------------
New York, New York
, 1997
SCHRODER XXXXXXXX & CO. INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
XXXXX XXXXXX INC.
As Representatives of
the several Underwriters
named in Schedule I hereto
c/x Xxxxxxxx Xxxxxxxx & Co. Incorporated
Equitable Center
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
Central European Media Enterprises Ltd., a Bermuda company (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters"), an aggregate $125,000,000 principal amount of % Convertible
Subordinated Notes Due 2004 (the "Notes") pursuant to the Indenture (the
"Indenture"), dated as of ,1997, between the Company and IBJ Xxxxxxxx
Bank & Trust Company, as Trustee (the "Trustee"). The Notes to be sold by the
Company are herein referred to as the "Firm Securities." In addition, the
Company proposes to grant to the Underwriters an option to purchase up to an
additional $18,750,000 principal amount of Notes (the "Option Securities"), on
the terms and for the purposes set forth in Section 2 hereof. The Firm
Securities and the Option Securities are herein collectively referred to as the
"Securities."
1. The Company represents and warrants to, and agrees with, each
of the Underwriters that:
(a) The Company meets the requirements for use of Form S-3
under the Securities Act of 1933, as amended (the "Act") and a
registration statement on Form S-3 (File No. 333-24365), and as a part
thereof a preliminary prospectus, in respect of the Securities, has
been filed with the Securities and Exchange Commission (the
"Commission") in the form heretofore delivered to you and, with the
exception of exhibits to the registration statement, to you for each of
the other Underwriters; if such registration statement has not become
effective, an amendment (the "Final Amendment") to such registration
statement, including a form of final prospectus, necessary to permit
such registration statement to become effective, will promptly be filed
by the Company with the Commission; if such registration statement has
become effective and any post-effective amendment to such registration
statement has been filed with the Commission prior to the execution and
delivery of this Agreement, which amendment or amendments shall
be in form acceptable to you, the most recent such amendment has been
declared effective by the Commission; if such registration statement
has become effective, a final prospectus (the "Rule 430A Prospectus")
relating to the Securities containing information permitted to be
omitted at the time of effectiveness by Rule 430A of the General Rules
and Regulations of the Commission (the "Rules") under the Securities
Act of 1933, as amended (the "Act"), will promptly be filed by the
Company pursuant to Rule 424(b) of the Rules (any preliminary
prospectus filed as part of such registration statement being herein
called a "Preliminary Prospectus," such registration statement as
amended at the time that it becomes or became effective, or, if
applicable, as amended at the time the most recent post-effective
amendment to such registration statement filed with the Commission
prior to the execution and delivery of this Agreement became effective
(the "Effective Date"), including all documents incorporated by
reference into the Rule 430A Prospectus or the Prospectus and all
exhibits thereto and all information deemed to be a part thereof at
such time pursuant to Rule 430A of the Rules, being herein called the
"Original Registration Statement" and the final prospectus (including
all documents incorporated therein by reference) relating to the
Securities in the form first filed pursuant to Rule 424(b)(1) or (4) of
the Rules or, if no such filing is required, the form of final
prospectus included in the Original Registration Statement, together
with pricing-related information, a term sheet or an abbreviated term
sheet, being herein called the "Prospectus");
(b) The Company may also file with the Commission a
registration statement pursuant to Rule 462(b) of the Rules for the
purpose of registering certain additional Securities (any such
registration statement, including any preliminary prospectus or
prospectus incorporated therein at the time such registration statement
becomes effective, being herein called a "Rule 462(b) Registration
Statement", and together with the Original Registration Statement, the
"Registration Statement"), which shall be effective upon filing with
the Commission and copies of which shall be delivered to you, and with
the exception of exhibits, if any, to you for each other Underwriter;
(c) No order preventing or suspending the use of any
Preliminary Prospectus or Prospectus has been issued by the Commission,
and each Preliminary Prospectus and Prospectus, at the time of filing
thereof, conformed in all material respects to the requirements of the
Act and the Rules, and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
through you expressly for use therein;
(d) On the Effective Date and the date the Prospectus is filed
with the Commission, and when any further amendment or supplements
thereto become effective or are filed with the Commission, as the case
may be, and at the Time of Delivery (as defined in Section 4 hereof)
and on any Option Securities Delivery Date (as defined in Section 4
hereof), the Registration Statement, the Prospectus and such amendment
or supplements did and will conform in all material respects to the
requirements of the Act and the Rules as in effect on such date (or,
with respect to documents incorporated therein by reference, on the
date of filing of such document), and did not and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading as of such dates (or, with respect to documents
incorporated by reference, on the date of filing of such document);
provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through you expressly for use therein;
(e) The Company has all requisite power and authority to
execute, deliver and perform its obligations under this Agreement; the
execution, delivery and performance by the Company of its obligations
under this Agreement have been duly and validly authorized by all
requisite corporate action of the Company; and this Agreement has been
executed and delivered by the Company and constitutes the
-2-
legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms;
(f) Neither the Company nor any of its Subsidiaries has
sustained since December 31, 1996, any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, which loss or interference is
material to the Company and its Subsidiaries, taken as a whole; and,
since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been, and
prior to the Time of Delivery (as defined in Section 4 hereof) there
will not be, any change in the capital stock or any material increase
in short-term debt or long-term debt of the Company or any of its
Subsidiaries, or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
general affairs, management, financial position, stockholders' equity
or results of operations of the Company and its Subsidiaries, taken as
a whole, otherwise than as set forth or contemplated in the Prospectus.
The term "Subsidiary" as used herein shall mean any person, firm,
partnership or corporation ("Legal Entity") in which the Company has a
direct or indirect equity or voting interest;
(g) The Company and its Subsidiaries have good and marketable
title to all real property and good and marketable title to all
personal property owned by them, in each case free and clear of all
liens, encumbrances and defects, except such as are described or
contemplated by the Prospectus, or such as would not, singly or in the
aggregate, have a material adverse effect on the Company and its
Subsidiaries taken as a whole, and any real property and buildings held
under lease by the Company and its Subsidiaries are held by them under
valid, subsisting and enforceable leases with such exceptions as are
described or contemplated by the Prospectus or such exceptions as would
not, singly or in the aggregate, have a material adverse effect on the
Company and its Subsidiaries taken as a whole;
(h) Each license pursuant to which the Company conducts its
broadcast operations ("License") has been duly and validly issued to
the Legal Entity specified in the Registration Statement as holding
such License pursuant to the licensing procedures of the jurisdiction
granting the same, and each such License is in full force and effect.
To the best of the Company's knowledge, except as disclosed in the
Prospectus, where broadcast properties are in operation, the broadcast
property to which each such License pertains is being operated
substantially in accordance with the terms of the applicable License
and the relevant legislation of the issuing jurisdiction or pursuant to
applicable exemptions or other relief therefrom, which exemptions or
other relief have been described in the Prospectus. To the best of the
Company's knowledge, at this time and as of the Time of Delivery (as
defined in Section 4 hereof), except as set forth or contemplated in
the Prospectus (i) no application, action or proceeding is or will be
pending for the modification of any License, (ii) no application,
action or proceeding is or will be pending or threatened that may
result in the revocation, modification, non-renewal or suspension of
any License, or the imposition of any administrative sanction, and
(iii) the issuance and sale of the Securities hereunder will not lead
to the revocation, modification, non-renewal or suspension of any
License, or the imposition of any administrative sanction;
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of Bermuda,
with power and authority (corporate and other) to own its properties
and to conduct its business as described in the Prospectus, and has
been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases property, or conducts any
business, so as to require such qualification (except where the failure
to so qualify would not have a material adverse effect on the Company
or the Company and its Subsidiaries considered as a whole); and each of
the Company's Subsidiaries has been duly incorporated or, if not a
corporation, duly organized, and is validly existing as a corporation
or other Legal Entity in good standing under the laws of its
jurisdiction of incorporation or organization, with power and authority
(corporate and other) to own or lease its properties and to conduct its
business as described in
-3-
the Prospectus and has been duly qualified as a foreign corporation or
other Legal Entity for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns or
leases property, or conducts any business, so as to require such
qualification (except where the failure to so qualify would not have a
material adverse effect on the Company and its Subsidiaries considered
as a whole); and the Company has all necessary corporate power and all
governmental authorizations, permits and approvals required to own its
properties and conduct its business as described in the Prospectus;
(j) The Company has an authorized, issued and outstanding
capitalization as set forth in the Registration Statement, and all the
issued shares of Common Stock, par value $.01 per share, of the Company
(the "Common Stock") have been duly and validly authorized and issued,
are fully paid and non-assessable, are free of any preemptive or
similar rights, were issued and sold in compliance with the applicable
federal, foreign and state securities laws and conform in all material
respects to the description in the Prospectus; as of December 31, 1996,
except as set forth in the Company's consolidated financial statements
included in the Prospectus, there are no outstanding options, warrants
or other rights calling for the issuance of, and there are no
commitments, plans or arrangements to issue, any shares of capital
stock of the Company or any security convertible or exchangeable or
exercisable for capital stock of the Company; there are no holders of
securities of the Company who, by reason of the filing of the
Registration Statement have the right (and have not waived such right)
to request the Company to include in the Registration Statement
securities owned by them; and all of the issued shares or other
interests in the capital of each Subsidiary of the Company as described
in the Prospectus as being owned by the Company have been duly and
validly authorized and issued, are fully paid and non-assessable and
are owned by the Company or one or more of the Company's Subsidiaries
free and clear of all liens, encumbrances, equities or claims, except
such as are described in the Prospectus or such as would not, singly,
or in the aggregate, have a material adverse effect on the Company and
its Subsidiaries, taken as a whole; and there are no outstanding
options, warrants or other rights calling for the issuance of, and
there are no commitments, plans or arrangements to issue, any shares of
capital stock of any Subsidiary or any security convertible or
exchangeable or exercisable for capital stock of any Subsidiary, except
such as are described in the Prospectus or such as would not, singly or
in the aggregate, have a material adverse effect on the Company and its
Subsidiaries, taken as a whole;
(k) The Company has all requisite power and authority to
execute, deliver and perform its obligations under the Indenture; the
execution, delivery and performance by the Company of its obligations
under the Indenture have been duly and validly authorized by all
requisite corporate action of the Company; and the Indenture has been
executed and delivered by the Company and constitutes the legal, valid
and binding obligation or the Company, enforceable against the Company
in accordance with its terms;
(l) The Company has all requisite power and authority to
execute, deliver and perform its obligations under the Notes; the
execution, delivery and performance by the Company of its obligations
under the Notes have been duly and validly authorized by all requisite
corporate action of the Company; and the Notes, when authenticated by
the Trustee and delivered against payment therefore as provided herein,
will constitute legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with its terms and
conform in an material respects to the description of the Notes in the
Prospectus and have been duly authorized for quotation subject to
official notice of issuance, on the Nasdaq Stock Market's SmallCap
Market;
(m) The shares of Common Stock to be issued upon conversion of
the Notes hereunder have been duly and validly authorized and, when
issued and delivered upon conversion of the Notes, will be duly and
validly issued, fully paid and non-assessable, will not be subject to
any lien, encumbrance, preemptive right or any other claim, will
conform in all material respects to the description of the Common Stock
in the Prospectus, and are duly authorized for quotation and will be
quoted, subject to official notice of issuance, on the Nasdaq Stock
Market's National Market (the "Nasdaq National Market");
-4-
(n) The performance of this Agreement and the consummation of
the transactions herein contemplated will not conflict with, or result
in a breach or violation of, any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company or
any of its Subsidiaries is a party or by which the Company or any of
its Subsidiaries is bound or to which any of the property or assets of
the Company or any of its Subsidiaries is subject, nor will such action
result in any violation of the provisions of the Memorandum of
Association or the bye-laws or any other equivalent corporate
governance document, in each case as amended, of the Company or any of
its Subsidiaries, or any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the
Company or any of its Subsidiaries or any of their properties; and no
consent, approval, authorization, order, registration or qualification
of or with any court or governmental agency or body is required for the
issue and sale of the Securities or the consummation of the other
transactions contemplated by this Agreement, except the registration
under the Act of the Securities, and such consents, approvals,
authorizations, registrations or qualifications as may be required
under state or foreign securities or Blue Sky laws in connection with
the purchase and distribution of the Securities by the Underwriters;
(o) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its Subsidiaries is a party or of which any property of the Company
or any of its Subsidiaries is the subject, other than litigation
incident to the business conducted by the Company and its Subsidiaries
which will not individually or in the aggregate have a material adverse
effect on the financial position, stockholders' equity or results of
operations of the Company and its Subsidiaries considered as a whole;
and, except as set forth in the Prospectus, to the best of the
Company's knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened or contemplated by others;
and neither the Company nor any of its Subsidiaries is involved in any
labor dispute, nor, to the Company's knowledge, is any labor dispute
threatened;
(p) The Company and its Subsidiaries have such licenses,
permits and other approvals or authorizations of and from governmental
or regulatory authorities ("Permits") as are necessary under applicable
law to own their prospective properties and to conduct their respective
businesses in the manner now being conducted and as described in the
Prospectus; and the Company and its Subsidiaries have fulfilled and
performed all of their respective obligations with respect to such
Permits, and no event has occurred which allows, or after notice or
lapse of time, or both, would allow, revocation or termination thereof
or result in any other material impairment of the rights of the holder
of any such Permits;
(q) The Company and each of its Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the
businesses in which they are engaged and in the jurisdictions in which
they conduct such businesses; neither the Company nor any such
Subsidiary has been refused any insurance coverage sought or applied
for; and neither the Company nor any such Subsidiary has any reason to
believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a cost that would not materially and adversely affect the
condition (financial or otherwise), business prospects, net worth or
results of operations of the Company and its Subsidiaries taken as a
whole, except as described in or contemplated by the Prospectus;
(r) Xxxxxx Xxxxxxxx & Co., who have certified certain
consolidated financial statements of (i) the Company and its
consolidated Subsidiaries, (ii) Slovenska Televizna Spolocnost, s.r.o
("STS" or the "Slovak Subsidiary"), (iii) 1A TV
Beteiligungsgesellschaft GmbH & Co. Betriebs KG ("XXXX"), and (iv)
Xxxxxxx Xxxx & Fernsehen GmbH ("FFF"), are independent public
accountants as required by the Act and the Rules;
-5-
(s) The consolidated financial statements of the Company and
the financial statements of STS, XXXX, and FFF and any other
unconsolidated associated company in which the Company has a financial
interest (the "Unconsolidated Associated Companies") included in the
Registration Statement (or incorporated by reference therein) and the
Prospectus present fairly the financial condition, the results of
operations and the cash flows of the Company (including its
predecessor), its consolidated Subsidiaries and the Unconsolidated
Associated Companies as of the dates and for the periods therein
specified in conformity with generally accepted accounting principles
consistently applied throughout the periods involved, except as
otherwise stated therein; and the other financial and statistical
information and data set forth in the Registration Statement and the
Prospectus is accurately presented and, to the extent such information
and data is derived from the financial statements and books and records
of the Company and its consolidated Subsidiaries, and the
Unconsolidated Associated Companies, no other financial statements are
required to be included in the Registration Statement (or incorporated
by reference therein) and the Prospectus;
(t) The Company is aware of no statutes or governmental
regulations, or any contracts or other documents that are required to
be described in or filed as exhibits to the Registration Statement
which are not described therein or filed or incorporated by reference
as exhibits thereto;
(u) The Company and its Subsidiaries own or possess adequate
patent rights or licenses or other rights to use patent rights,
inventions, trademarks, service marks, trade names and copyrights
necessary to conduct the general businesses now operated by them and
neither the Company nor any of its Subsidiaries has received any notice
of infringement of, or conflict with, asserted rights of others with
respect to any patent, patent rights, inventions, trademarks, service
marks, trade names or copyrights which, singly or in the aggregate,
could materially adversely affect the business, operations, financial
condition, income or business prospects of the Company and its
Subsidiaries considered as a whole;
(v) In addition to the rights described in paragraph (u)
hereof, the Company and its Subsidiaries have rights under appropriate
binding agreements to broadcast the programming they currently
broadcast, and are scheduled to broadcast. To the best of the Company's
knowledge, broadcasting of these programs by the Company and its
Subsidiaries pursuant to the rights granted under such agreements does
not and will not violate any copyright or other laws relating to the
use of another party's intellectual property;
(w) Neither the Company nor any of its Subsidiaries is in
violation of any term or provision of its memorandum of association or
bye-laws or equivalent corporate governance documents, in each case as
amended to the date hereto, or of any law, ordinance, administrative or
governmental rule or regulation applicable to the Company or any of its
Subsidiaries, or of any decree of any court or governmental agency or
body having jurisdiction over the Company or any of its Subsidiaries,
the violation of which could have a material adverse effect on the
Company or any of its Subsidiaries;
(x) No default exists, and no event has occurred which with
notice or lapse of time, or both, would constitute a default in the due
performance and observance of any term, covenant or condition of any
indenture, mortgage, deed of trust, bank loan or credit agreement,
lease or other agreement or instrument to which the Company or any of
its Subsidiaries is a party or by which any of them is bound, except
such as is disclosed in the Prospectus or such as would not, singly or
in the aggregate, have a material adverse effect on the Company and its
Subsidiaries taken as a whole;
(y) The Company and its Subsidiaries, other than the Romanian
Subsidiary (as defined below), have timely filed all necessary tax
returns and notices and have paid all federal, state, county, local and
foreign taxes of any nature whatsoever for all tax years through
December 31, 1996, to the extent such taxes have become due. The
Company has no knowledge, or any reasonable grounds to know, of any tax
deficiencies which would have a material adverse effect on the Company
or any of its Subsidiaries, taken
-6-
as a whole; the Company and its Subsidiaries, other than the Romanian
Subsidiary, have paid all taxes which have become due, whether pursuant
to any assessments, or otherwise, and there is no further liability
(whether or not disclosed on such returns) or assessments for any such
taxes, and no interest or penalties accrued or accruing with respect
thereto, except as may be set forth or adequately reserved for in the
financial statements included in the Registration Statement; the
amounts currently set up as provisions for taxes or otherwise by the
Company and its Subsidiaries, other than the Romanian Subsidiary, on
their books and records are sufficient for the payment of all their
unpaid federal, foreign, state, county and local taxes accrued through
the dates as of which they speak, and for which the Company and its
Subsidiaries may be liable in their own right, or as a transferee of
the assets of, or as successor to any other corporation, association,
partnership, joint venture or other Legal Entity;*
(z) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or
specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for
assets; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to
any differences;
(aa) No labor disturbance by the employees of the Company or
any of its Subsidiaries exists or, to the best knowledge of the
Company, is imminent which might be expected to have a material adverse
effect on the business, properties, financial condition, results of
operations or prospects of the Company and its Subsidiaries considered
as a whole;
(ab) No stamp or other issuance or transfer taxes or duties
and no capital gains, income, withholding or other taxes are payable by
or on behalf of the Underwriters to Bermuda or to any political
subdivision or taxing authority thereof or therein in connection with
the sale and delivery by the Underwriters of the Securities to the
initial purchasers thereof;
(ac) The indemnification and contribution provisions set
forth in Section 8 hereof do not contravene Bermuda law or public
policy;
(ad) Neither the Company nor any of its Subsidiaries nor, to
the Company's knowledge, any employee or agent of the Company or any of
its Subsidiaries has made any payment of funds of the Company or any
Subsidiary or received or retained any funds in violation of any law,
rule or regulation, which payment, receipt or retention of funds is of
a character required to be disclosed in the Prospectus;
(ae) The Company is not an investment company or a company
controlled by an investment company within the meaning of the
Investment Company Act of 1940, as amended;
(af) Neither the Company nor any of its Subsidiaries will be a
Foreign Personal Holding Company ("FPHC") as defined in Section 552 of
the Internal Revenue Code of 1986, as amended (the "Code"), for its
taxable year ending December 31, 1997, and to the best of the Company's
knowledge, neither the Company nor any of its Subsidiaries will become
FPHCs in the future by reason of the nature of their income. In
addition, neither the Company nor any of its Subsidiaries will be a
Passive Foreign
------------------
* The Romanian Subsidiary has failed to timely pay certain VAT and
related penalties and withholding taxes in Romania, which taxes and
penalties, if not paid or relieved following a successful appeal to
the Romanian taxation authorities, could have a material adverse
effect on the Romanian Subsidiary, but would not have a material
adverse effect on the Company and its Subsidiaries taken as a whole.
-7-
Investment Company ("PFIC"), as defined in Section 1296
of the Code, for its taxable year ending December 31, 1996, and to the
best of the Company's knowledge, neither the Company nor its
Subsidiaries will become PFICs in the future by reason of the nature of
their income or assets. The Company will take such reasonable efforts
as are necessary to structure its and its Subsidiaries' operations to
avoid any of them becoming an FPHC or a PFIC. Should the Company or any
of its Subsidiaries become a PFIC in any year, the Company will provide
sufficient information to its shareholders to enable them to elect to
have the PFIC treated as a qualified electing fund for purposes of
Section 1295 of the Code;
(ag) The Company has not taken and will not take, directly or
indirectly, any action designed to, or which has constituted or that
might reasonably be expected to cause or result in, stabilization or
manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities, in each case as defined under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
the General Rules and Regulations of the Commission thereunder;
(ah) The Company has validly and irrevocably submitted to the
jurisdiction of any U.S. Federal or State court located in the Borough
of Manhattan, the City of New York, and has designated Corporation
Service Company as its agent for service of process; and
(ai) The Indenture has been qualified under the Trust
Indenture Act of 1939, as amended.
2. Subject to the terms and conditions herein set forth, the Company
agrees to issue and sell to the several Underwriters an aggregate principal
amount of $125,000,000 Firm Securities, and each of the Underwriters agrees to
purchase from the Company, at a purchase price of $______ per $1,000, the
respective aggregate principal amount of Firm Securities determined in the
manner set forth below. The obligation of each Underwriter to the Company shall
be to purchase that portion of the principal amount of Notes to be sold by the
Company pursuant to this Agreement as the number of Firm Securities set forth
opposite the name of such Underwriter on Schedule I bears to the total principal
amount of Firm Securities to be purchased by the Underwriters pursuant to this
Agreement, in each case adjusted by you such that no Underwriter shall be
obligated to purchase Firm Securities other than in multiples of $1,000. In
making this Agreement, each Underwriter is contracting severally and not
jointly.
In addition, subject to the terms and conditions herein set forth, the
Company agrees to issue and sell to the Underwriters, as required (for the sole
purpose of covering over-allotments in the sale of the Firm Securities), up to a
principal amount of $18,750,000 of Option Securities at the purchase price per
$1,000 of the Firm Securities being sold by the Company as stated in the
preceding paragraph. The right to purchase the Option Securities may be
exercised by your giving 48 hours' prior written notice to the Company of your
determination to purchase all or a portion of the Option Securities. Such notice
may be given at any time within a period of 30 days following the date of this
Agreement. Option Securities shall be purchased severally for the account of
each Underwriter in proportion to the number of Firm Securities set forth
opposite the name of such Underwriter in Schedule I hereto. No Option Securities
shall be delivered to or for the accounts of the Underwriters unless the Firm
Securities shall be simultaneously delivered or shall theretofore have been
delivered as herein provided. The respective purchase obligations of each
Underwriter shall be adjusted by you so that no Underwriter shall be obligated
to purchase Option Securities other than in multiples of $1,000. The
Underwriters may cancel any purchase of Option Securities at any time prior to
the Option Securities Delivery Date (as defined in Section 4 hereof) by giving
written notice of such cancellation to the Company.
3. Upon the authorization by you of the release of the Securities, the
Underwriters propose to offer the Securities for sale upon the terms and
conditions set forth in the Prospectus.
-8-
4. Certificates in definitive form for the Firm Securities to be
purchased by each Underwriter hereunder shall be delivered by or on behalf of
the Company to you for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by certified or
official bank check or checks, payable in Federal or other same day funds, to
the order of the Company, for the purchase price of the Firm Securities being
sold by the Company in New York, New York, at 9:30 A.M., New York City time, on
______________, 1997, or at such other time, date and place as you and the
Company may agree upon in writing, such time and date being herein called the
"Time of Delivery."
Certificates in definitive form for the Option Securities to be
purchased by each Underwriter hereunder shall be delivered by or on behalf of
the Company to you for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price thereof by certified or
official bank check or checks, payable in Federal or other same day funds, to
the order of the Company, for the purchase price of the Option Securities, in
New York, New York, at such time and on such date (not earlier than the Time of
Delivery nor later than six business days after giving of the notice delivered
by you to the Company with reference thereto) and in such denominations and
registered in such names as shall be specified in the notice delivered by you to
the Company with respect to the purchase of such Option Securities. The date and
time of such delivery and payment are herein sometimes referred to as the
"Option Securities Delivery Date." The obligations of the Underwriters shall be
subject, in their discretion, to the condition that there shall be delivered to
the Underwriters on the Option Securities Delivery Date opinions and
certificates, dated such Option Securities Delivery Date, referring to the
Option Securities, instead of the Firm Securities, but otherwise to the same
effect as those required to be delivered at the Time of Delivery pursuant to
Section 7(d), 7(e), 7(f), 7(g), 7(h), 7(i), 7(j), 7(k), 7(l), 7(m), 7(n), 7(o),
7(p), 7(q), 7(r) and 7(t), provided, that if the Option Securities Delivery Date
and the Time of Delivery are the same, additional deliveries described by this
section shall not be required.
Certificates for the Firm Securities and the Option Securities so to be
delivered will be in good delivery form, and in such denominations and
registered in such names as you may request not less than 48 hours prior to the
Time of Delivery and the Option Securities Delivery Date, respectively. Such
certificates will be made available for checking and packaging in New York, New
York, at least 24 hours prior to the Time of Delivery and the Option Securities
Delivery Date.
5. The Company agrees with each of the Underwriters:
(a) If the Registration Statement has not become effective, to
promptly file the Final Amendment with the Commission and use its best
efforts to cause the Registration Statement to become effective; if the
Original Registration Statement has become effective, to promptly file
the Rule 430A Prospectus with the Commission in accordance with the
provisions of such rule; to make no further amendment or any supplement
to the Original Registration Statement or Prospectus or file any Rule
462(b) Registration Statement which shall be reasonably disapproved by
you after reasonable notice thereof; to advise you, promptly after it
receives notice thereof of the time when the Registration Statement, or
any amendment thereto, or any amended Registration Statement has become
effective or any supplement to the Prospectus or any amended Prospectus
or Rule 462(b) Registration Statement has been filed, of the issuance
by the Commission of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus, of
the suspension of the qualification of the Securities for offering or
sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission
for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and in the event of the
issuance of any stop order or of any order preventing or suspending the
use of any Preliminary Prospectus or the Prospectus or suspending any
such qualification to use promptly its best efforts to obtain
withdrawal of such order; (b) Promptly from time to time to take such
action as you may reasonably request to qualify the Securities for
offering and sale under the securities laws of such jurisdictions as
you may request and
-9-
to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary
to complete the distribution, provided that in connection therewith the
Company shall not be required to qualify as a foreign corporation or to
file a general consent to service of process in any jurisdiction, and
in each jurisdiction in which the Securities have been so qualified,
the Company will file such statements and reports as may be required by
the laws of such jurisdiction to continue each qualification in effect
for a period of not less than one year from the Effective Date;
(c) To deliver to you and, with the exception of exhibits, to
you for each other Underwriter, copies of the Original Registration
Statement, each Rule 462(b) Registration Statement, two of which will
be signed and will include all exhibits, each Preliminary Prospectus,
the Prospectus and all amendments or supplements thereto and all
documents incorporated by reference into the Registration Statement in
such quantities and in such form or forms as you may from time to time
reasonably request, and if delivery of a prospectus is required by law
in connection with sales of Securities at any time prior to the
expiration of nine months after the time of issue of the Prospectus and
if at such time any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact
necessary in order to make statements therein, in the light of the
circumstances under which they were made when such Prospectus is
delivered, not misleading, or if for any other reason it shall be
necessary to amend or supplement the Prospectus in order to comply with
the Act, to notify you and upon your request to prepare and furnish
without charge to each Underwriter and to any dealer in securities as
many copies as you may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which will correct
such statement or omission or effect such compliance; and in case any
Underwriter is required to deliver a prospectus in connection with
sales of any of the Securities at any time nine months or more after
the time of issue of the Prospectus, upon your request but at the
expense of such Underwriter, to prepare and deliver to such Underwriter
as many copies as you may request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its stockholders as soon as
practicable, but in any event not later than 90 days after the close of
the period covered thereby, an earnings statement in form complying
with the provisions of Section 11(a) of the Act and Rule 158 of the
Rules covering a period of 12 consecutive months beginning not later
than the first day of the Company's fiscal quarter next following the
Effective Date;
(e) To file promptly all documents required to be filed with
the Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act
subsequent to the Effective Date and during any period when the
Prospectus is required to be delivered;
(f) For a period of five years from the Effective Date, to
furnish to its stockholders after the end of each fiscal year an annual
report (including a combined or consolidated balance sheet and
statements of income, cash flow and stockholders' equity of the Company
and its Subsidiaries certified by independent public accountants) and,
as soon as practicable after the end of each of the first three
quarters of each fiscal year (beginning with the fiscal quarter ending
after the Effective Date), to file with the Commission combined or
consolidated summary financial information of the Company and its
Subsidiaries for such quarter in reasonable detail;
(g) During a period of five years from the Effective Date, to
furnish to you copies of all reports or other communications (financial
or other) furnished to its stockholders, and deliver to you (i) as soon
as they are available, copies of any reports and financial statements
furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company is listed;
and (ii) such additional information concerning the business and
financial condition of the Company as you may from time to time
reasonably request in connection with your obligations hereunder;
-10-
(h) During the period of 120 days after the date hereof,
except pursuant to this Agreement and to its 1994 and 1995 Stock Option
Plans, the Company will not offer, sell or otherwise dispose of any
capital stock of the Company, directly or indirectly, without the prior
written consent of the Representatives; and
(i) That it will not take, directly or indirectly, any action
designed to, or that might reasonably be expected to cause or result
in, stabilization or manipulation of the price of the Common Stock to
facilitate the sale or resale of the Securities.
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid: (i) the fees, disbursements and
expenses of counsel and accountants for the Company, and all other expenses, in
connection with the preparation, printing and filing of the Original
Registration Statement and the Prospectus and (except as otherwise provided in
Section 5(c) hereof) amendments and supplements thereto and any Rule 462(b)
Registration Statement and the furnishing of copies thereof, including charges
for mailing, air freight and delivery and counting and packaging thereof and of
any Preliminary Prospectus and related offering documents to the Underwriters
and dealers; (ii) the cost of printing this Agreement, the Agreement Among
Underwriters, the Selling Agreement, communications among the Company, the
Underwriters and the selling group and the Preliminary and Supplemental Blue Sky
Memoranda; (iii) all expenses in connection with the qualification of the
Securities for offering and sale under state securities laws provided in Section
5(b) hereof, including filing and registration fees and the fees, disbursements
and expenses for counsel for the Underwriters in connection with such
qualification and in connection with Blue Sky surveys; (iv) the filing fees
incident to securing any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Securities; and (v) all
other costs and expenses incident to the performance of its obligations
hereunder which are not otherwise specifically provided for in this Section 6,
including the fees of the Company's Trustee, Transfer Agent and Registrar, the
cost of any stock transfer taxes on sale of the Securities to the Underwriters,
the cost of the Company's personnel and other internal costs, the cost of
printing and engraving the certificates representing the Securities and all
expenses and taxes incident to the sale and delivery of the Securities to be
sold by the Company to the Underwriters hereunder.
It is understood, however, that, except as provided in this Section 6,
Section 8 and Section 12 hereof, the Underwriters will pay all their own costs
and expenses, including the fees of their counsel, stock transfer taxes on
resale of any of the Securities by them, and any advertising expenses connected
with any offers they may make.
7. The obligations of the Underwriters hereunder shall be subject, in
their discretion, to the condition that all representations and warranties and
other statements of the Company herein are, at and as of the Time of Delivery,
true and correct, the condition that the Company shall have performed all its
obligations hereunder theretofore to be performed, and the following additional
conditions:
(a) The Original Registration Statement and, if the Company
has elected to rely on Rule 462(b), the Rule 462(b) Registration
Statement shall have been declared effective, and you shall have
received notice thereof with respect to the Original Registration
Statement, and time confirmation thereof with respect to any Rule
462(b) Registration Statement, not later than 10:00 P.M., New York City
time, on the date of execution of this Agreement, or at such other time
as you and the Company may agree; if required, the Prospectus shall
have been filed in accordance with Rule 424(b)(1) or (4) of the Rules
not later than 48 hours following the execution of this Agreement; no
stop order suspending the effectiveness of the Registration Statement
shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your reasonable satisfaction;
(b) All corporate proceedings and related legal and other
matters in connection with the organization of the Company and the
registration, authorization, issue, sale and delivery of the Securities
-11-
shall have been reasonably satisfactory to Xxxx, Xxxx, Xxxxxxx, Xxxxx &
Xxxx, L.L.P., counsel to the Underwriters, and Xxxx, Xxxx, Xxxxxxx,
Xxxxx & Xxxx, L.L.P. shall have been furnished with such papers and
information as they may reasonably have requested to enable them to
pass upon the matters referred to in this subsection;
(c) You shall not have advised the Company that the
Registration Statement or Prospectus, or any amendment or supplement
thereto, or any Rule 462(b) Registration Statement contains an untrue
statement of fact or omits to state a fact which in your judgment is in
either case material and in the case of an omission is required to be
stated therein or is necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading;
(d) Xxxxxxx, Xxxx & Xxxxxxx, Bermuda counsel to the Company,
shall have furnished to you their written opinion, dated the Time of
Delivery, in form and substance satisfactory to you, to the effect
that:
(i) each of the Company, and International Media
Services Ltd. ( "Media", and together with the Company, the
"Bermuda Companies") has been duly and validly incorporated
and is validly existing as a corporation in good standing
under the laws of Bermuda (meaning, among other things, that
the Company has not failed to make any filing with any Bermuda
governmental authority or to pay any Bermuda governmental fee
or tax, the failure of which would make the Company liable to
be struck from the Register of Companies and thereby cease to
exist under the laws of Bermuda); and the Company has all
necessary corporate power to own and lease its properties and
conduct its business as described in the Prospectus;
(ii) the Company has an authorized capitalization as
set forth in the Registration Statement and all the issued
shares of capital stock of the Company have been duly and
validly authorized and issued, are fully paid and
nonassessable and are free of any preemptive rights. The
Securities being sold by the Company have been duly and
validly authorized and, when duly authenticated by the Trustee
and delivered in accordance with the provisions of the
Registration Statement and this Agreement, will be legal,
valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms, except as
enforceability of the same may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting creditors rights generally and except as
enforceability of the same may be affected by principles of
equity; and the Securities conform to the description of the
Securities in the Prospectus; to such counsel's knowledge, all
of the issued shares or other interests in the capital of
Media which have been issued or granted to the Company or any
Subsidiary of the Company have been validly created, allotted
and issued, and the Company is, directly or indirectly, the
holder of fifty percent of the issued share capital or other
interests of Media;
(iii) this Agreement, the Indenture, and each
agreement relating to the Company's investment in the Studio
1+1 Group (as defined in the Prospectus) listed in such
counsel's opinion, have been duly authorized, executed and
delivered by the Company and each is a legal, valid and
binding agreement of the Company or Media, as the case may be,
enforceable in accordance with its terms, except as
enforceability of the same may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and except as
enforceability of those provisions relating to indemnity may
be limited by the securities laws and principles of public
policy in Bermuda or in the United States;
(iv) the Company has full corporate power and
authority to execute, deliver and perform this Agreement and
the Indenture, and the execution, delivery and performance of
this Agreement, the consummation of the transactions herein
contemplated and the issue and sale of
-12-
the Securities and the compliance by the Company with all the
provisions of this Agreement will not result in any violation
of the provisions of the Memorandum of Association or the
Bye-laws, in each case as amended, of the Company, any statute
or, to the best of such counsel's knowledge, any order, rule
or regulation of any court or governmental agency or body
having jurisdiction over the Company;
(v) no consent, approval, authorization, order,
registration or qualification of or with any Bermuda court,
regulatory authority or other Bermuda governmental body is
required which has not been duly obtained in accordance with
Bermuda law for the issue and sale of the Securities or the
consummation of the other transactions contemplated by this
Agreement;
(vi) there are no preemptive or other rights to
subscribe for or to purchase, nor any restriction upon the
voting of, any Securities pursuant to the Company's Memorandum
of Association or Bye-laws, in each case as amended;
(vii) no stamp or other issuance or transfer taxes or
duties and no capital gains, income, withholding or other
taxes are payable by or on behalf of the Underwriters to
Bermuda or to any political subdivision or taxing authority
thereof or therein in connection with the sale and delivery by
the Underwriters of the Securities to the initial purchasers
thereof;
(viii) the statements in the Prospectus relating to
Bermuda law, including but not limited to those under the
captions "Risk Factors - Enforcement of Civil Liabilities and
Judgments," "Risk Factors - Bermuda Corporate Law,"
"Description of Capital Stock," "Certain Tax Considerations -
Bermuda Taxation," "Management - Executive Officers and
Directors" and "Underwriting" in the Prospectus and Item 15 of
Part II of the Registration Statement, insofar as such
statements constitute a summary of matters of Bermuda law and
regulation or legal conclusions with respect thereto, are
accurate in all material respects;
(ix) the indemnification and contribution provisions
set forth in Section 8 of this Agreement do not contravene
Bermuda law or public policy;
(x) assuming the validity of such actions under
applicable federal and state laws in the United States, under
the laws of Bermuda relating to submission to jurisdiction,
the Company has validly and irrevocably submitted to the
jurisdiction of any U.S. Federal or state court located in the
Borough of Manhattan, the City of New York, and the service of
process effected in the manner set forth in this Agreement
will be effective, insofar as Bermuda law is concerned, to
confer valid personal jurisdiction over the Company; and
(xi) any judgment obtained in any U.S. federal or
state court of competent jurisdiction sitting in New York City
arising out of or in relation to the obligations of the
Company under this Agreement would be enforced against the
Company in Bermuda courts, provided that, inter alia, (a) such
judgment is obtained in compliance with legal requirements of
the jurisdiction of the court rendering such judgment and in
compliance with all legal requirements of this Agreement; (b)
such judgment is strictly for the payment of a certain sum of
money based on an in personam (rather than an in rem) action,
provided that pursuant to Bermuda law, obligations payable in
Bermuda in a foreign currency, whether by agreement or by a
judgment of a Bermuda court, may be discharged in Bermuda
currency at the rate of exchange for such currency prevailing
at the time of payment; (c) service of process was made
personally on the Company or on the appropriate process agent;
(d) such judgment does not contravene Bermuda public policy,
Bermuda law, international treaties or agreements binding upon
Bermuda or generally accepted principles of international law;
(e) the applicable procedure under the laws of
-13-
Bermuda with respect to the enforcement of foreign judgments
(including the issuance of a letter rogatory by the competent
authority of such jurisdiction in accordance with the laws
thereof) is complied with; (f) such judgment is final in the
jurisdiction where it was obtained; and (g) the U.S. federal
or state courts recognize the principles of reciprocity in
connection with the enforcement of Bermuda judgments in the
United States or the State of New York, as the case may be.
In rendering their opinions set forth in Section 7(d) above, such
counsel may rely, to the extent deemed advisable by such counsel, (a) upon
certificates of state officials, and (b) on opinions of counsel (provided,
however, that you shall have received a copy of each of such opinions which
shall be dated the Time of Delivery, addressed to you or otherwise authorizing
you to rely thereon; and that Xxxxxxx, Xxxx & Xxxxxxx in its opinion to you
delivered pursuant to this subsection, shall state that such counsel are
satisfactory to them and Xxxxxxx, Xxxx & Xxxxxxx has no reason to believe that
you and they are not entitled to so rely);
(e) Xxxxx & XxXxxxxx, special Netherlands counsel to the
Company, shall have furnished to you their written opinion, dated the
Time of Delivery, in the form and substance satisfactory to you, to the
effect that:
(i) CME Media Enterprises B.V. ("CME BV"), Central
European Media Enterprises N.V. and each of other Subsidiary
listed on Schedule I to such counsel's opinion (collectively,
the "Dutch and Netherlands Antilles Subsidiaries") have each
been duly incorporated or duly organized as a limited
liability company or other Legal Entity under the laws of the
Kingdom of the Netherlands and the Netherlands Antilles,
respectively;
(ii) all of the issued shares or other interests in
the capital of the Dutch and Netherlands Antilles Subsidiaries
which have been issued or granted to the Company or any
Subsidiary have been validly created, allotted and issued, and
the Company is the direct or indirect registered holder of all
of the issued share capital or other interests of the Dutch
and Netherlands Antilles Subsidiaries;
(iii) this Agreement, the Indenture, and each
agreement relating to the Company's investment in the Studio
1+1 Group (as defined in the Prospectus) listed in such
counsel's opinion, have been duly authorized, executed and
delivered by the Company and each is a legal, valid and
binding agreement of the Company or any of the Dutch and
Netherlands Subsidiaries, as the case may be, enforceable in
accordance with its terms, except as enforceability of the
same may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights
generally and except as enforceability of those provisions
relating to indemnity may be limited by the securities laws
and principles of public policy in the Netherlands, the Dutch
Antilles or the United States; and
(iv) such counsel does not know of any litigation or
any governmental proceeding pending or threatened in the
Kingdom of the Netherlands or the Netherlands Antilles against
the Company or any Subsidiary which would affect the subject
matter of this Agreement or is required to be disclosed in the
Prospectus which is not disclosed and correctly summarized
therein.
(f) Xxxxxxxx & Xxxxx XXX, U.S. counsel to the Company, shall
have furnished to you their written opinion, dated the Time of
Delivery, in form and substance satisfactory to you, to the effect
that:
(i) each of the Subsidiaries listed on Schedule I to
such counsel's opinion (which Schedule shall set forth all of
the United States Subsidiaries) (collectively, the "United
States
-14-
Subsidiaries") has been duly incorporated or duly
organized as a corporation or other Legal Entity under United
States law;
(ii) the statements under the caption "Certain Tax
Considerations - United States" in the Prospectus insofar as
such statements constitute a summary of matters of U.S. tax
law and regulations or legal conclusions with respect thereto,
are accurate in all material respects;
(iii) assuming due authorization, execution and
delivery by the parties thereto, this Agreement is a valid and
binding agreement of the Company enforceable in accordance
with its terms, including but not limited to the choice of law
provision contained in paragraph 15 hereof;
(iv) the execution, delivery and performance of this
Agreement and the Indenture by the Company, compliance by the
Company with all the provisions hereof and the consummation of
the transactions contemplated hereby (including, without
limitation, the issuance and sale of the Securities) will not
require any consent, approval authorization or other order of
any U.S. court, regulatory body, administrative agency or
other governmental body (except such as may be required under
the Act or other securities or Blue Sky laws), or violate or
conflict with any U.S. laws, administrative regulations or
rulings or court decrees applicable to the Company or any of
the Subsidiaries, except where failure to receive any such
consent, approval, authorization or any such conflict, breach
or default would not have a material adverse effect on the
business and financial condition of the Company and the
Subsidiaries taken as a whole;
(v) the Registration Statement has become effective
under the Act, any required filing of the Prospectus, and any
supplements thereto, pursuant to Rule 424(b) under the Act,
has been made in the manner and within the time period
required by Rule 424(b) under the Act, and no stop order
suspending its effectiveness has been issued and no
proceedings for the purpose are, to the knowledge of such
counsel, pending before or contemplated by the Commission;
(vi) to such counsel's knowledge, no holders of
securities of the Company have rights to the registration
thereof under the Registration Statement or, if any such
holders have such rights, such holders have waived such
rights;
(vii) the Company is not an "investment company"
within the meaning of the Investment Company Act of 1940, as
amended;
(viii) to such counsel's knowledge, no contract or
other document or U.S. Statute or regulation is required to be
disclosed in the Registration Statement and Prospectus or to
be filed as an exhibit to the Registration Statement that is
not disclosed therein or filed as required, and each contract
governed by the laws of the State of New York or U.S. Federal
law summarized in the Registration Statement and Prospectus is
in full force and effect;
(ix) such counsel does not know of any U.S.
governmental legal proceeding pending or threatened against
the Company or any Subsidiary which would affect the subject
matter of this Agreement or is required to be disclosed in the
Prospectus which is not disclosed and correctly summarized
therein;
(x) the Indenture has been qualified under the Trust
Indenture Act of 1939, and the summary descriptions under the
caption "Description of the Notes" in the Prospectus generally
conform to the Notes and the Indenture;
-15-
(xi) assuming the due authorization, execution and
delivery by the parties thereto, the Indenture has been duly
executed and delivered by the Company and is a legal, valid
and binding agreement of the Company enforceable in accordance
with its terms, except as enforceability of the same may be
limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting creditors' rights generally
and except as enforceability may be limited by governing
principles of equity; and
(xii) (1) the Registration Statement and the
Prospectus and any supplement or amendment thereto (except for
financial statements and other financial and statistical data,
as to which no belief will be expressed) comply as to form in
all material respects with the Act and (2) no facts have come
to the attention of such counsel which lead such counsel to
believe that (except for financial statements and other
financial and statistical data, as to which no belief will be
expressed) the Registration Statement and the Prospectus
included therein at the time the Registration Statement became
effective contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein
in order to make the statements therein not misleading, and
that the Prospectus, as amended or supplemented, if applicable
(except for financial statements and other financial and
statistical data, as to which no belief will be expressed), as
of its date and as of the Time of Delivery, contained any
untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading.
(g) Doser Amereller Xxxxx, special German counsel to the
Company, shall have furnished to you their written opinion, dated the
Time of Delivery, in form and substance satisfactory to you, to the
effect that:
(i) each of the Subsidiaries listed on Schedule I to
such counsel's opinion (collectively, the "German
Subsidiaries") is validly existing as a partnership or other
Legal Entity under German law;
(ii) each of the German Subsidiaries has the
corporate power and authority required to carry on its
business as it is stated to be carried on in the Prospectus
and to own and lease its properties;
(iii) to such counsel's knowledge, all of the issued
shares or other interests in the capital of the German
Subsidiaries which have been issued or granted to Central
European Media Enterprises N.V., a Netherlands Antilles
company, and CME Media Enterprises B.V., a Netherlands company
(together, the "Dutch Companies") have been validly created,
allotted and issued, and the Dutch Companies are, directly or
indirectly, the holders of the percentage of the issued share
capital or other interests of such German Subsidiaries
disclosed in the Prospectus;
(iv) the Partnership Agreement for 1A TV
Beteiligungsgesellschaft GmbH & Co. Betriebs KG among the
partners named therein dated May 14, 1993 (the "1A Berlin
Partnership Agreement"); the Agreement on the Establishment of
a Silent Partnership dated April 19, 1994, as amended, between
Xx. Xxxxxxx Xxxxxxx, CEDC Management Services GmbH & Co. Media
Enterprises KG and FFF (the "Nuremberg Partnership
Agreement"); the Agreement of September 1995, by and between
CME Medienbeteiligungen GmbH & Co. Media Enterprises KG and
Sachsen Funk und Fernsehen GmbH (the "Leipzig and Dresden
Agreement"); and all other agreements relating to the rights
and obligations of the Company or the German Subsidiaries
created under the 1A Berlin Partnership Agreement, the
Nuremberg Partnership Agreement and the Leipzig and Dresden
Agreement (collectively, the "German Constituent Documents,"
which
-16-
may be specified in a schedule to such counsel's opinion) are
valid and binding agreements and are enforceable in
accordance with their terms;
(v) the execution, delivery and performance of this
Agreement and the Indenture by the Company, compliance by the
Company with all the provisions hereof and the issuance and
sale of the Securities by the Company in accordance with the
terms hereof and of the Agreement Among Underwriters (a) will
not require any consent, approval, authorization or other
order of any German court, regulatory body or other German
governmental body to be obtained and (b) will not violate any
German law or regulation with the proviso that because there
are no rulings or decisions relating to this issue, it is not
without doubt;
(vi) no orders for the opening of bankruptcy
proceedings or resolutions of dissolution have been registered
in the respective commercial register with respect to any of
the German Subsidiaries and such counsel is not aware of any
such proceedings having been applied for or any such
resolution having been passed with respect to any of them;
(vii) the German Subsidiaries have been issued the
Licenses required by them under the applicable laws of each of
the German states granting such Licenses for the purposes of
carrying on their broadcast operations as described in the
Prospectus (the "German Licenses"); except for pending
litigation disclosed and correctly summarized in the
Prospectus, to such counsel's knowledge, no application,
action or proceeding is or will be pending or threatened that
may result in the revocation, modification, nonrenewal or
suspension of the German Licenses, or the imposition of any
administrative sanction; the issuance and sale of the
Securities hereunder will not lead to the revocation,
modification, nonrenewal or suspension of the German Licenses,
or the imposition of any administrative sanction; and such
counsel are not aware of any breaches of the terms of the
German Licenses (except as disclosed and correctly summarized
in the Prospectus) which would lead any regulatory authorities
to take any action under their respective powers in relation
thereto;
(viii) insofar as the statements under the captions
"The Company," and "Business Operations in Germany: the German
Stations" in the Prospectus relate to agreements governed by
German law or to German provisions of law ("German legal
matters") referred to therein and insofar as they purport to
describe the legal effect of the German Constituent Documents,
such statements correctly describe such legal matters and such
legal effect; and
(ix) such counsel is not aware of any litigation or
any governmental proceeding pending or threatened in Germany
against the Company or any Subsidiary which would affect the
subject matter of this Agreement or is required to be
disclosed in the Prospectus which is not disclosed and
correctly summarized therein.
(h) Radvan & Co., special Czech counsel to the Company, shall
have furnished to you their written opinion, dated the Time of
Delivery, in the form and substance satisfactory to you, to the effect
that:
(i) Ceska Nezavisla Televizni Spolecnost s.r.o. (the
"Czech Subsidiary") has been duly incorporated or organized
as a limited liability company under the laws of the Czech
Republic and Radio Alfa, a.s. ("Radio Alfa") has been duly
incorporated or organized as a joint stock company under the
laws of the Czech Republic;
-17-
(ii) each of the Czech Subsidiary and Radio Alfa has
the power and authority required to carry on its business as
it is stated to be carried on in the Prospectus and to own and
lease its properties;
(iii) all of the issued shares or other interests in
the capital of the Czech Subsidiary which have been issued or
granted to a subsidiary of the Company have been validly
created, allotted and issued, and fully paid, and the Company
is, directly or indirectly, the registered holder of the
percentage of the issued share capital or other interests of
such Czech Subsidiary disclosed in the Prospectus;
(iv) the Memorandum of Association and Investment
Agreement dated, May 4, 1993, as amended, by and between
Central European Development Corporation Management Services
GmbH, Ceska Sporitelna, a.s. and CET 21 s.r.o. (CET 21) the
Loan Agreement and Transfer Agreements relating to the
transfer of 2% of the Participation Interest in the Czech
Subsidiary between the CME BV and Czech Savings Bank all dated
August 1, 1996; the Loan Agreement, Transfer Agreements and
Trusteeship Agreement between the CME BV and Xx. Xxxxxxx
regarding the transfer of Participation Interests in CET 21
all dated August 1, 1996; and all other material agreements
reviewed by such counsel relating to the rights and
obligations of the Company with respect to the Czech
Subsidiary (collectively, the "Nova Documents") are valid and
binding agreements and are enforceable in accordance with
their terms;
(v) the Consultancy Agreement (the "Consultancy
Agreement") dated February 9, 1995, by and between CME BV and
Radio Alfa a.s. ("Radio Alfa"); the Loan Agreement dated
February 9, 1995 between CME BV and Radio Alfa, as
supplemented by the several Supplemental Loan Agreements
(collectively, the "Loan Agreements"); each of the Agreements
on Future Agreement between CME BV and IDOS, spel. s.r.o. and
Xxxxxx a.s. relating to options to purchase additional
interests in Radio Alfa (collectively, the "Option
Agreements"); and all other material agreements reviewed by
such counsel relating to the rights and obligations of the
Company and any Subsidiary with respect to Radio Alfa created
(collectively, the "Radio Alfa Documents," and together with
the Nova Documents, the "Czech Constituent Documents," which
may be specified in a schedule to such counsel's opinion) are
valid and binding agreements and are enforceable in accordance
with their terms;
(vi) the execution, delivery and performance of this
Agreement and the Indenture by the Company, compliance by the
Company with all the provisions hereof and thereof and the
issuance and sale of the Securities by the Company in
accordance with the terms hereof and thereof (a) will not
require any consent, approval, authorization or other order of
any Czech court, regulatory body or other Czech governmental
body to be obtained and (b) will not violate any Czech law or
regulation;
(vii) there are no winding up petitions against the
Czech Subsidiary or, to the best of such counsel's knowledge,
against Radio Alfa;
(viii) CET 21 and Radio Alfa have obtained the
Licenses required under applicable laws of the Czech Republic
for purposes of carrying on their respective broadcast
operations as described in the Prospectus (collectively the
"Czech Licenses") and the Czech Subsidiary has acquired from
CET 21 the exclusive right to use CET 21's License to
broadcast the Czech Subsidiary's programming in the Czech
Republic, except for the administrative proceedings disclosed
and correctly summarized in the Prospectus regarding an
alleged inconsistency between the present registration of the
scope of business activity of the Czech Subsidiary, to the
best knowledge of such counsel, there are no orders
outstanding which have been made against CET
-18-
21, the Czech Subsidiary or Radio Alfa; no application, action
or proceeding is or will be pending or threatened that may
result in the revocation, modification, nonrenewal or
suspension of the Czech Licenses, or the imposition of any
administrative sanction; the issuance and sale of the
Securities hereunder will not lead to the revocation,
modification, nonrenewal or suspension of the Czech Licenses,
or the imposition of any administrative sanction; and there
have been no breaches of the terms of the Czech Licenses
(except as disclosed and correctly summarized in the
Prospectus) which would lead any regulatory authorities to
take any action under their respective powers in relation
thereto;
(ix) insofar as the statements under the captions
"The Company," "Business Operations in the Czech Republic:
Nova TV" and "Business - Operations in the Czech Republic:
Radio Alfa" in the Prospectus constitute a summary of Czech
law and insofar as they purport to describe the legal effect
of the Czech Constituent Documents, such statements fairly
describe relevant Czech law and such legal effect; and
(x) such counsel is not aware of any litigation or
any governmental proceeding pending or threatened in the Czech
Republic against Radio Alfa, the Company or any Subsidiary
which would affect the subject matter of this Agreement or is
required to be disclosed in the Prospectus which is not
disclosed and correctly summarized therein.
(i) Radvan & Co., special Slovak counsel to the Company, shall
have furnished to you their written opinion, dated the Time of
Delivery, in the form and substance satisfactory to you, to the effect
that:
(i) STS has been duly incorporated or organized as
a limited liability company under the laws of the Slovak
Republic;
(ii) the Slovak Subsidiary has the power and
authority required to carry on its business as it is stated
to be carried on in the Prospectus and to own and lease its
properties;
(iii) all of the shares or other interests, in the
capital of the Slovak Subsidiary which have been issued or
granted to a subsidiary of the Company have been validly
created, allotted and issued and fully paid, and the Company
is, directly or indirectly, the registered holder of the
percentage of the issued share capital or other interests of
such Slovak Subsidiary disclosed in the Registration
Statement;
(iv) the Memorandum of Association and Articles of
Association each dated September 28, 1995 of the Slovak
Subsidiary; the Participants Agreement dated September 28,
1995 between CME BV and Markiza - Slovakia s.r.o. ("Markiza");
the agreement between CME BV and Xxxxxxx dated October 1, 1995
regarding CME BV's contributions; the Mandate Agreement
between Markiza and the Czech Subsidiary (collectively the
"STS Agreements"); and all other material agreements reviewed
by such counsel relating to the rights and obligations of the
Company and any Subsidiary with respect to the Slovak
Subsidiary (collectively, the "Slovak Constituent Documents"
which may be specified in a schedule to such counsel's
opinion) are valid and binding agreements and are enforceable
in accordance with their terms;
(v) the execution, delivery and performance of this
Agreement and the Indenture by the Company, compliance by the
Company with all the provisions hereof and thereof and the
issuance and sale of the Securities by the Company in
accordance with the terms hereof and thereof (a) will not
require any consent, approval, authorization or other order of
any Slovak
-19-
court, regulatory body or other Slovak governmental body to
be obtained and (b) will not violate any Slovak law or
regulation;
(vi) there are, to the best of such counsel's
knowledge, no winding up petitions against the Slovak
Subsidiary or Markiza;
(vii) Markiza has obtained the License required by it
under applicable Slovak law for purposes of carrying on its
broadcast operations as described in the Prospectus (the
"Slovak License") and STS has acquired from Markiza the
exclusive right to use the License such that television
programming produced by STS is broadcast under the Slovak
License by Xxxxxxx; to the best of such counsel's knowledge,
there are no orders outstanding which have been made against
STS or Markiza; no application, action or proceeding is
pending or threatened that may result in the revocation,
modification, nonrenewal or suspension of the Slovak License,
or the imposition of any administrative sanction; the issuance
and sale of the Securities hereunder will not lead to the
revocation, modification, nonrenewal or suspension of the
Slovak License, or the imposition of any administrative
sanction (except as disclosed and correctly summarized in the
Prospectus); and there have been no breaches of the terms of
the Slovak License (except as disclosed and correctly
summarized in the Prospectus) which would lead them to take
any action under their respective powers in relation thereto;
(viii) insofar as the statements under the captions
"The Company" and "Business Operations in the Slovak Republic:
Markiza TV" in the Prospectus constitute a summary of Slovak
law and insofar as they purport to describe the legal effect
of the Slovak Constituent Documents, such statements fairly
describe relevant Slovak law and such legal effect; and
(ix) such counsel does not know of any litigation or
any governmental proceeding pending or threatened in the
Slovak Republic against STS, Markiza, the Company or any
Subsidiary which would affect the subject matter of this
Agreement or is required to be disclosed in the Prospectus
which is not disclosed and correctly summarized therein.
(j) Xxxxx & Pensa, special Slovenian counsel to the Company, shall have
furnished to you their written opinion, dated the Time of Delivery, in the form
and substance satisfactory to you, to the effect that:
(i) Prodkcija Plus d.o.o. Ljubljana ( "Pro Plus" or
the "Slovenian Subsidiary") has been duly incorporated or
organized as a limited liability company under the laws of
Slovenia;
(ii) the Slovenian Subsidiary has the power and
authority required to carry on its business as it is stated
to be carried on in the Prospectus and to own and lease its
properties;
(iii) all of the issued shares or other interests in
the capital of the Slovenian Subsidiary which have been issued
or granted to a subsidiary of the Company have been validly
created, allotted and issued, and the Company is, directly or
indirectly, the registered holder of the percentage of the
issued share capital or other interests of such Slovenian
Subsidiary disclosed in the Prospectus;
(iv) the Partnership Agreement dated February 10,
1995 among CME BV, MMTV 1 d.o.o., Ljubljana ("MMTV") and Tele
59 d.o.o., Maribor ("Tele 59"); the Share Purchase Agreement
dated April 8, 1995 by and between CME BV and Xxxxxx Xxxxxx,
Zorgova 70, Ljublana ("Meglic"); the Preliminary Agreement
dated December 7, 1995 by and between CME BV and Tele 59; and
all other material agreements reviewed by such counsel
relating to the rights and obligations of the Company and any
Subsidiary with respect to the Slovenian Subsidiary
-20-
(collectively, the "Slovenian Constituent Documents," which
may be specified in a schedule to such counsel's opinion) are
valid and binding agreements and are enforceable in accordance
with their terms;
(v) the execution, delivery and performance of this
Agreement and the Indenture by the Company, compliance by the
Company with all the provisions hereof and thereof and the
issuance and sale of the Securities by the Company in
accordance with the terms hereof and thereof (a) will not
require any consent, approval, authorization or other order of
any Slovenian court, regulatory body or other Slovenian
governmental body to be obtained and (b) will not violate any
Slovenian law or regulation;
(vi) to the best knowledge of such counsel there are
no winding up petitions against the Slovenian Subsidiary,
MMTV, Meglic or Tele 59;
(vii) MMTV and Tele 59 have been issued the Licenses
required under applicable Slovenian law for the purposes of
carrying on their broadcast operations as described in the
Prospectus (the "Slovenian Licenses"), and have agreed to (a)
order the production of television programs exclusively from
the Slovenian Subsidiary, (b) broadcast only programs provided
by the Slovenian Subsidiary, and (c) grant the Slovenian
Subsidiary the exclusive right to sell advertising during
their broadcasts; to the best knowledge of such counsel there
are no orders outstanding which have been made against the
Slovenian Subsidiary; no application, action or proceeding is
pending or threatened that may result in the revocation,
modification, nonrenewal or suspension of the Slovenian
Licenses, or the imposition of any administrative sanction;
the issuance and sale of the Securities hereunder will not
lead to the revocation, modification, nonrenewal or suspension
of the Slovenian Licenses, or the imposition of any
administrative sanction; and there have been no breaches of
the terms of the Slovenian Licenses (except as disclosed and
correctly summarized in the Prospectus) which would lead any
regulatory authorities to take any action under their
respective powers in relation thereto;
(viii) insofar as the statements under the captions
"The Company" and "Business Operations in Slovenia: POP TV" in
the Prospectus constitute a summary of Slovenian law and
insofar as they purport to describe the legal effect of the
Slovenian Constituent Documents, such statements fairly
describe relevant Slovenian law and such legal effect; and
(ix) such counsel does not know of any litigation or
any governmental proceeding pending or threatened in Slovenia
against Meglic MMTV, Tele 59, the Company or any Subsidiary
which would affect the subject matter of this Agreement or is
required to be disclosed in the Prospectus which is not
disclosed and correctly summarized therein.
(k) Xxxxx Xxxxxxxxx, special Romanian counsel to the Company, shall
have furnished to you their written opinion, dated the Time of Delivery, in the
form and substance satisfactory to you, to the effect that:
(i) Media Pro International S.A. (the "Romanian
Subsidiary") and Unimedia, S.R.L. ("Unimedia") has been duly
incorporated or organized as a joint stock company under the
laws of Romania;
(ii) each of the Romanian Subsidiary and Unimedia
has the power and authority required to carry on its business
as it is stated to be carried on in the Prospectus and to
own and lease its properties;
-21-
(iii) all of the issued shares or other interests in
the capital of each of the Romanian Subsidiary and Unimedia
which have been issued or granted to a subsidiary of the
Company have been validly created, allotted and issued, and
the Company is, directly or indirectly, the registered holder
of the percentage of the issued share capital or other
interests of such Romanian Subsidiary or Unimedia disclosed in
the Prospectus;
(iv) the Cooperation Agreement dated August 1995
among CME BV, Xxx Xxxxxx and Xxxxxx Xxxxx; the various Loan
Agreements between CME BV and Pro TV, S.R.L., and all other
material agreements reviewed by such counsel relating to the
rights and obligations of the Company and any Subsidiary with
respect to the Romanian Subsidiary (collectively, the
"Romanian Constituent Documents," which may be specified in a
schedule to such counsel's opinion); and all material
agreements reviewed by such counsel relating to the rights and
obligations of the Company and any Subsidiary with respect to
Unimedia (collectively, the "Unimedia Documents," which may be
specified in a schedule to such counsel's opinion) are valid
and binding agreements and are enforceable in accordance with
their terms;
(v) the execution, delivery and performance of this
Agreement and the Indenture by the Company, compliance by the
Company with all the provisions hereof and thereof and the
issuance and sale of the Securities by the Company in
accordance with the terms hereof and thereof (a) will not
require any consent, approval, authorization or other order of
any Romanian court, regulatory body or other Romanian
governmental body to be obtained and (b) will not violate any
Romanian law or regulation;
(vi) there are no winding up petitions against
either the Romanian Subsidiary or Unimedia;
(vii) those entities which constitute the "Pro TV
Network" as described in the Prospectus have been issued the
Licenses required by them under applicable Romanian law for
the purposes of carrying on their broadcast operations as
described in the Prospectus (the "Romanian Licenses"); to the
best knowledge of such counsel, there are no orders
outstanding which have been made against such entities; no
application, action or proceeding is or will be pending or
threatened that may result in the revocation, modification,
nonrenewal or suspension of the Romanian Licenses, or the
imposition of any administrative sanction; the issuance and
sale of the Securities hereunder will not lead to the
revocation, modification, nonrenewal or suspension of the
Romanian Licenses, or the imposition of any administrative
sanction; and there have been no breaches of the terms of the
Romanian Licenses (except as disclosed and correctly
summarized in the Prospectus) which would lead any regulatory
authorities to take any action under their respective powers
in relation thereto;
(viii) insofar as the statements under the captions
"The Company" and "Business Operations in Romania: PRO TV" in
the Prospectus constitute a summary of Romanian law and
insofar as they purport to describe the legal effect of the
Romanian Constituent Documents or the Unimedia Documents, such
statements fairly describe relevant Romanian law and such
legal effect; and
(ix) such counsel does not know of any litigation or
any governmental proceeding pending or threatened in Romania
against the Company or any Subsidiary which would affect the
subject matter of this Agreement or is required to be
disclosed in the Prospectus which is not disclosed and
correctly summarized therein.
-22-
(l) Xxxxxx Xxxxx, special Hungarian counsel to the Company, shall have
furnished to you their written opinion, dated the Time of Delivery, in the form
and substance satisfactory to you, to the effect that:
(i) Each of the Subsidiaries listed in Schedule I to
such counsel's opinion (collectively, the "Hungarian
Subsidiaries") has been duly incorporated or duly organized as
a partnership or other Legal Entity under the laws of Hungary;
(ii) Each of the Hungarian Subsidiaries has the
power and authority required to carry on its business as it
is stated to be carried on in the Prospectus and to own and
lease its properties;
(iii) all of the issued shares or other interests in
the capital of each of the Hungarian Subsidiaries which have
been issued or granted to a subsidiary of the Company have
been validly created, allotted and issued, and the Company is,
directly or indirectly, the registered holder of the
percentage of the issued share capital or other interests of
each of the Hungarian Subsidiaries disclosed in the
Prospectus;
(iv) the material agreements set forth in Schedule I
to such counsel's opinion relating to the rights and
obligations of the Company and any Subsidiary with respect to
each Hungarian Subsidiary (collectively, the "Hungarian
Constituent Documents,") are valid and binding agreements and
are enforceable in accordance with their terms;
(v) the execution, delivery and performance of this
Agreement and the Indenture by the Company, compliance by the
Company with all the provisions hereof and thereof and the
issuance and sale of the Securities by the Company in
accordance with the terms hereof and thereof (a) will not
require any consent, approval, authorization or other order of
any Hungarian court, regulatory body or other Hungarian
governmental body to be obtained and (b) will not violate any
Hungarian law or regulation;
(vi) there are no winding up petitions against any
of the Hungarian Subsidiaries;
(vii) each of Veszprem TV kft. ("Veszprem TV") and
2002 kft. ("2002") has been issued the License required by it
under applicable Hungarian law for the purposes of carrying on
its broadcast operations as described in the Prospectus
(collectively, the "Hungarian Licenses"); to the best
knowledge of such counsel, there are no orders outstanding
which have been made against any Hungarian Subsidiary; no
application, action or proceeding is or will be pending or
threatened that may result in the revocation, modification,
nonrenewal or suspension of any Hungarian License, or the
imposition of any administrative sanction; the issuance and
sale of the Securities hereunder will not lead to the
revocation, modification, nonrenewal or Suspension of any
Hungarian License, or the imposition of any administrative
sanction; and there have been no breaches of the terms of any
Hungarian License (except as disclosed and correctly
summarized in the Prospectus) which would lead any regulatory
authorities to take any action under their respective powers
in relation thereto;
(viii) insofar as the statements under the captions
"The Company" and "Business "Business - Broadcast Operations
Under Development - Hungary" in the Prospectus constitute a
summary of Hungarian law and insofar as they purport to
describe the legal effect of the Hungarian Constituent
Documents, such statements fairly describe relevant Hungarian
law and such legal effect; and
(ix) such counsel does not know of any litigation or
any governmental proceeding pending or threatened in Hungary
against the Company or any Subsidiary which would affect the
-23-
subject matter of this Agreement or is required to be
disclosed in the Prospectus which is not disclosed and
correctly summarized therein.
(m) Xxxxxxxxx & Gray, special Polish counsel to the Company,
shall have furnished to you their written opinion, dated the Time of
Delivery, in the form and substance satisfactory to you, to the effect
that:
(i) TVN Sp. z.o.o. ("TVN") has been duly incorporated
or duly organized as a partnership or other Legal Entity
under the laws of Poland;
(ii) the Polish Subsidiary has the power and
authority required to carry on its business as it is stated
to be carried on in the Prospectus and to own and lease its
properties;
(iii) all of the issued shares or other interests in
the capital of the Polish Subsidiary which have been issued or
granted to a subsidiary of the Company have been validly
created, allotted and issued, and the Company is, directly or
indirectly, the registered holder of the percentage of the
issued share capital or other interests of such Polish
Subsidiary disclosed in the Prospectus;
(iv) all material agreements scheduled in such
counsel's opinion relating to the rights and obligations of
the Company and any Subsidiary with respect to the Polish
Subsidiary (collectively, the "Polish Constituent Documents,"
) are valid and binding agreements and are enforceable in
accordance with their terms;
(v) the execution, delivery and performance of this
Agreement and the Indenture by the Company, compliance by the
Company with all the provisions hereof and thereof and the
issuance and sale of the Securities by the Company in
accordance with the terms hereof and thereof (a) will not
require any consent, approval, authorization or other order of
any Polish court, regulatory body or other Polish governmental
body to be obtained and (b) will not violate any Polish law or
regulation;
(vi) to the best knowledge of such counsel, there
are no winding up petitions against the Polish Subsidiary;
(vii) Televisja Wisla Sp.z.o.o. ("TV Wisla") has been
issued the License required under applicable Polish law for
the purposes of carrying on its broadcast operations as
described in the Prospectus (collectively, the "Polish
License"); to the best knowledge of such counsel, there are no
orders outstanding which have been made against the Polish
Subsidiary or TV Wisla; no application, action or proceeding
is pending or threatened that may result in the revocation,
modification, nonrenewal or suspension of the Polish License,
or the imposition of any administrative sanction; the issuance
and sale of the Securities hereunder will not lead to the
revocation, modification, nonrenewal or suspension of the
Polish License, or the imposition of any administrative
sanction; and there have been no breaches of the terms of the
Polish License (except as disclosed and correctly summarized
in the Prospectus) which would lead any regulatory authorities
to take any action under their respective powers in relation
thereto;
(viii) insofar as the statements under the captions
"The Company" and "Business Broadcast Operations Under
Development - Poland" in the Prospectus constitute a summary
of Polish law and insofar as they purport to describe the
legal effect of the Polish Constituent Documents, such
statements fairly describe relevant Polish law and such legal
effect; and
-24-
(ix) such counsel does not know of any litigation or
any governmental proceeding pending or threatened in Poland
against the Company or any Subsidiary which would affect the
subject matter of this Agreement or is required to be
disclosed in the Prospectus which is not disclosed and
correctly summarized in the Prospectus.
(n) Xxxxx & XxXxxxxx, special Ukraine counsel to the Company,
shall have furnished to you their written opinion, dated the Time of
Delivery, in the form and substance satisfactory to you, to the effect
that:
(i) to the best knowledge of such counsel each of the
companies listed on Schedule I to such counsel's opinion (the
"Ukraine Participants") has been duly incorporated or duly
organized as a legal entity under the laws of Ukraine;
(ii) to the best knowledge of such counsel each of
the Ukraine Participants has the power and authority required
to carry on its business as it is stated to be carried on in
the Prospectus and to own and lease its properties;
(iii) all of the issued shares or other interests in
the capital of each Ukraine Participant which have been issued
or granted to Intermedia Ukraine ("Intermedia") or Innova have
been validly created, allotted and issued, and Intermedia and
Innova, directly or indirectly, are the registered holders of
the percentages of the issued share capital or other interests
of each Ukraine Participant disclosed in the Prospectus;
(iv) all material agreements scheduled in such
counsel's opinion relating to the rights and obligations of
the Company, any Subsidiary, Media, Intermedia or Innova with
respect to any Ukraine Participant (collectively, the "Ukraine
Constituent Documents") are valid and binding agreements and
are enforceable in accordance with their terms;
(v) insofar as the statements under the captions "The
Company" and "Business Operations in Ukraine: Studio 1+1
Group" in the Prospectus purport to describe the legal effect
of the Ukraine Constituent Documents, such statements fairly
describe such legal effect.
(o) Xxxxx Xxxxxx, special Ukraine counsel to the Company,
shall have furnished to you his written opinion, dated the Time of
Delivery, in the form and substance satisfactory to you, to the effect
that:
(i) the execution, delivery and performance of this
Agreement and the Indenture by the Company, compliance by the
Company with all the provisions hereof and thereof and the
issuance and sale of the Securities by the Company in
accordance with the terms hereof and thereof (a) will not
require any consent, approval, authorization or other order of
any Ukraine court, regulatory body or other Ukraine
governmental body to be obtained and (b) will not violate any
Ukraine law or regulation;
(ii) to the best knowledge of such counsel there are
no winding up petitions against Intermedia or any of the
Ukraine Participants;
(iii) Tele Radiogesellschaft Studio 1+1 has been
issued the License required under applicable Ukraine law for
the purposes of carrying on its broadcast operations, as the
same are described in the Prospectus (the "Ukraine License");
to the best knowledge of such counsel, there are no orders
outstanding which have been made against the Company,
Intermedia, Innova, Media or any of the Ukraine Participants;
no application, action or proceeding is or will be pending or
-25-
threatened that may result in the revocation, modification,
nonrenewal or suspension of the Ukraine License (except as
disclosed and correctly summarized in the Prospectus), or the
imposition of any administrative sanction; the issuance and
sale of the Securities hereunder will not lead to the
revocation, modification, nonrenewal or suspension of the
Ukraine License, or the imposition of any administrative
sanction; and there have been no breaches of the terms of the
Ukraine License (except as disclosed in the Prospectus) which
would lead any regulatory authorities to take any action under
their respective powers in relation thereto;
(iv) insofar as the statements under the captions
"The Company" and "Business Operations in Ukraine: Studio 1+1
Group" in the Prospectus constitute a summary of Ukraine law,
such statements fairly describe relevant Ukraine law; and
(v) such counsel does not know of any litigation or
any governmental proceeding pending or threatened in Ukraine
against the Ukraine Participant, Company or any Subsidiary
which would affect the subject matter of this Agreement or is
required to be disclosed in the Prospectus which is not
disclosed and correctly summarized therein.
(p) _____________, special Austrian counsel to the Company,
shall have furnished to you their written opinion, dated the Time of
Delivery, in the form and substance satisfactory to you, to the effect
that:
(i) to the best knowledge of such counsel each of the
companies listed on Schedule I to such counsel's opinion (the
"Austrian Subsidiaries") has been duly incorporated or duly
organized as a legal entity under the laws of Ukraine;
(ii) to the best knowledge of such counsel each of
the Austrian Subsidiaries has the power and authority required
to carry on its business as it is stated to be carried on in
the Prospectus and to own and lease its properties;
(iii) all of the issued shares or other interests in
the capital of each Austrian Subsidiary which have been issued
or granted to the Company, any Subsidiary, Intermedia or
Innova have been validly created, allotted and issued, and the
Company, any Subsidiary, Innova and Intermedia, directly or
indirectly, are the registered holders of the percentages of
the issued share capital or other interests of Media and
Innova disclosed in the Prospectus; and
(iv) all material agreements scheduled in such
counsel's opinion relating to the rights and obligations of
the Company, any Subsidiary, Innova or Media with respect to
any Austrian Subsidiary (collectively, the "Austrian
Subsidiary Constituent Documents") are valid and binding
agreements and are enforceable in accordance with their terms.
(q) Xxxx, Xxxx, Xxxxxxx, Xxxxx & Xxxx, L.L.P., counsel to the
Underwriters, shall have furnished to you their written opinion, dated
the Time of Delivery, in form and substance satisfactory to you, with
respect to the incorporation of the Company, the validity of the
Securities, the Registration Statement, the Prospectus and other
related matters as you may reasonably request, and such counsel shall
have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(r) At the time this Agreement is executed and also at the
Time of Delivery, Xxxxxx Xxxxxxxx & Co. LLP shall have furnished to you
a letter or letters, dated the date of this Agreement and the Time of
Delivery, in form and substance satisfactory to you, to the effect,
that:
-26-
(1) They are independent certified public accountants
with respect to the Company and each Unconsolidated Associated
Company within the meaning of the Act and the applicable
published rules and regulations thereunder;
(2) In their opinion, the consolidated financial
statements of the Company and the financial statements of each
Unconsolidated Associated Company (including the related
schedules and notes) included in the Registration Statement
(or incorporated by reference therein) and Prospectus and
covered by their reports included therein comply as to form in
all material respects with the applicable accounting
requirements of the Act and the published rules and
regulations thereunder;
(3) On the basis of specified procedures as of a
specified date not more than five days prior to the date of
their letter (which procedures do not constitute an
examination made in accordance with generally accepted
auditing standards), consisting of a reading of the latest
available unaudited interim consolidated financial statements
of the Company and the unaudited financial statements of each
Unconsolidated Associated Company (with an indication of the
date or dates of each such latest available financial
statements), inquiries of officials of the Company who have
responsibility for financial and accounting matters, and such
other procedures or inquiries as are specified in such letter,
nothing came to their attention that caused them to believe
that:
(A) (i) Any material modifications should be
made to the unaudited consolidated financial
statements described in this Section 7(r), included
in the Registration Statement for them to be in
conformity with generally accepted accounting
principles; and
(ii) The unaudited consolidated
financial statements described in this Section 7(r)
do not comply as to form in all material respects
with the applicable accounting requirements of the
Act and the related published rules and regulations.
(B) (i) At ___________, 1997, there was any
change in the capital stock, increase in long-term
debt, or decrease in net current assets or
shareholders' equity of the Company or any
Unconsolidated Associated Company as compared with
amounts shown in the [________________ unaudited]
consolidated balance sheet included in the
Registration Statement other than as shown in the
Registration Statement; or
(ii) for the period from
_________________________, there was any change as
compared to the corresponding period in the preceding
year, in combined net revenues or in the total or
per-share amounts of income (loss) before
extraordinary items or of net income (loss), except
in all instances for changes, increase, or decreases
that the Registration Statement discloses have
occurred or may occur.
(C) Based solely on inquiries of certain
officials of the Company who have responsibility for
financial and accounting matters and minutes of
meetings of stockholders, the board of directors and
the compensation committee of the Company, nothing
came to their attention that caused them to believe
(i) at _________________, 1997, there was any change
in the capital stock, increase in long-term debt or
any decreases in net current assets or stockholders'
equity of the Company or any Unconsolidated
Associated Company as compared with amounts shown on
the [_____________________ unaudited] consolidated
balance sheet included in the Registration Statement
or (ii) for the period from __________________, there
were any
-27-
decreases, as compared with the corresponding period
in the preceding year, in net revenues or in the
total or per share amounts of income (loss) before
extraordinary items or of net income (loss) other
than as disclosed in the Registration Statement.
(4) In addition to the examination referred to in
their reports included in the Registration Statement and the
Prospectus and the limited procedures referred to in clause
(4) above, they have carried out certain specified procedures,
not constituting an audit, with respect to certain amounts,
percentages and financial information which are derived from
the general accounting records of the Company and its
consolidated Subsidiaries which appear in the Prospectus under
the captions which have been specified by you, and have
compared such amounts and financial information with the
accounting records of the Company, its consolidated
Subsidiaries and the Unconsolidated Associated Companies and
have found them to be in agreement and have proved the
mathematical accuracy of certain specified percentages; and
(s) (1) Neither the Company nor any of its consolidated
Subsidiaries shall have sustained since _________________, any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree; and (2) since
the respective dates as of which information is given in the
Prospectus, there shall not have been any change in the capital stock
or short-term debt or long-term debt of the Company or any of its
consolidated Subsidiaries nor any change or any development involving a
prospective change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of
the Company and its consolidated Subsidiaries, otherwise than as set
forth or contemplated in the Prospectus, the effect of which, in any
such case described in clause (1) or (2), is in your judgment so
material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Securities on
the terms and in the manner contemplated in the Prospectus;
(t) The Company shall have furnished or caused to be furnished
to you at the Time of Delivery certificates signed by the chief
executive officer and the chief financial officer, on behalf of the
Company, satisfactory to you as to such matters as you may reasonably
request and as to (1) the accuracy of the Company's respective
representations and warranties herein at and as of the time of Delivery
and (2) the performance by the Company of all of its respective
obligations hereunder to be performed at or prior to the Time of
Delivery; the Company shall have furnished or caused to be furnished to
you at the Time of Delivery certificates signed by the chief executive
officer and the chief financial officer, on behalf of the Company, as
to (1) the fact that they have carefully examined the Registration
Statement and Prospectus and, (a) as of the Effective Date, the
statements contained in the Registration Statement and the Prospectus
were true and correct and neither the Registration Statement nor the
Prospectus omitted to state a material fact required to be stated
therein or necessary to make the statement therein not misleading and
(b) since the Effective Date, no event has occurred that is required by
the Act or the Rules to be set forth in an amendment of, or a
supplement to, the Prospectus that has not been set forth in such an
amendment or supplement; and (2) the matters set forth in subsection
(a) of this Section 7; and
(u) Each director and officer and certain 5% shareholders and
other shareholders of the Company, and any Legal Entity under their
respective control shall have delivered to you an agreement not to
offer, sell or otherwise dispose of any shares of Common Stock (or
securities convertible or exchangeable into shares of Common Stock),
directly or indirectly into the public market, for a period of 120 days
after the date of this Agreement, without the prior written consent of
the Xxxxxxxx Xxxxxxxx & Co. Incorporated.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are
-28-
based upon (i) any untrue statement or alleged untrue statement made by the
Company in Section 1 of this Agreement, (ii) any untrue statement or alleged
untrue statement of a material fact contained or incorporated by reference in
any Preliminary Prospectus and not corrected in the Prospectus, the Original
Registration Statement, any Rule 462(b) Registration Statement or the
Prospectus, or any amendment or supplement thereto, or in any Blue Sky
application or other document executed by the Company specifically for that
purpose or based upon written information furnished by the Company filed in any
state or other jurisdiction in order to qualify any or all the Securities under
the securities laws thereof or filed with the Commission or any securities
association or securities exchange (each, an "Application"), or the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements made or incorporated by reference therein
not misleading, or (iii) the employment by the Company of any device, scheme or
artifice to defraud, or the engaging by the Company in any act, practice or
course of business which operates or would operate as a fraud or deceit, or any
conspiracy with respect thereto, in which the Company shall participate, in
connection with the issuance and sale of any of the Securities, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating, preparing to defend,
defending or appearing as a third-party witness in connection with any such
action or claim; provided, however, that the Company shall not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission relating to an Underwriter made in any Preliminary
Prospectus, the Original Registration Statement, any Rule 462(b) Registration
Statement the Prospectus or such amendment or supplement or any Application in
reliance upon and in conformity with written information furnished to the
Company by such Underwriter through you expressly for use therein; and provided,
further, that the indemnity agreements contained in this Section 8(a) with
respect to any Preliminary Prospectus shall not inure to the benefit of any
Underwriter (or any person controlling such Underwriter) on account of any
losses, claims, damages, liabilities or litigation arising from the sale of
Securities to any person, if such Underwriter fails to send or give a copy of
the Prospectus, as the same may be then supplemented or amended, to such person,
within the time required by the Act and the untrue statement or alleged untrue
statement or omission or alleged omission of a material fact contained in such
Preliminary Prospectus was corrected in the Prospectus, unless such failure is
the result of noncompliance by the Company with Section 5(c) hereof.
(b) In addition to any obligations of the Company under
Section 8(a), the Company agrees that it shall perform indemnification
obligations under Section 8(a) (as modified by the last paragraph of this
Section 8(b)) with respect to counsel fees and expenses and other expenses
reasonably incurred by making payments within 45 days to the Underwriter in the
amount of the statements of the Underwriter's counsel or other statements which
shall be forwarded by the Underwriter, and that they shall make such payments
notwithstanding the absence of a judicial determination as to the propriety and
enforceability of the obligation to reimburse the Underwriters for such expenses
and the possibility that such payment might later be held to have been improper
by a court and a court orders return of such payments, in which event, after a
final order to such effect from which no appeal may be taken, such amounts will
be returned to the Company, with such interest, if any, as the court may order.
The indemnity agreement in Section 8(a) shall be in addition to any
liability which the Company shall otherwise have and shall extend upon the same
terms and conditions to each person, if any, who controls any Underwriter within
the meaning of the Act or the Exchange Act.
(c) Each Underwriter will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to which the Company
may become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Original Registration Statement,
any Rule 462(b) Registration Statement or the Prospectus, or any amendment or
supplement thereto, or any Application, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statement therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, the Original Registration Statement, any Rule 462(b)
Registration
-29-
Statement, the Prospectus or such amendment or supplement or any Application in
reliance upon and in conformity with written information furnished to the
Company by such Underwriter relating to such Underwriter through you expressly
for use therein, and will reimburse the Company for any legal or other expenses
reasonably incurred by the Company in connection with investigating or defending
any such action or claim.
The indemnity agreement in this Section 8(c) shall be in addition to
any liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Company and to each person, if any, who controls the Company within the meaning
of the Act or the Exchange Act.
(d) Promptly after receipt by an indemnified party under
Section 8(a) or 8(c) of notice of the commencement of any action (including any
governmental investigation), such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such subsection,
notify the indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party shall not relieve it from any
liability which it may have to any indemnified party under Section 8(a) or 8(c)
except to the extent it was unaware of such action and has been prejudiced in
any material respect by such failure or from any liability which it may have to
any indemnified party otherwise than under such Section 8(a) or 8(c). In case
any such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation. If, however, (i)
the indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party and (ii) an
indemnified party shall have reasonably concluded that representation of such
indemnified party and the indemnifying party by the same counsel would be
inappropriate under applicable standards of professional conduct due to actual
or potential differing interests between them and the indemnified party so
notifies the indemnifying party, then the indemnified party shall be entitled to
employ counsel different from counsel for the indemnifying party at the expense
of the indemnifying party and the indemnifying party shall not have the right to
assume the defense of such indemnified party. In no event shall the indemnifying
parties be liable for fees and expenses of more than one counsel (in addition to
local counsel) for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same set of allegations or circumstances. The counsel with respect to which
fees and expenses shall be so reimbursed pursuant to the second preceding
sentence shall be designated in writing by Schroder Xxxxxxxx & Co. Incorporated
in the case of parties indemnified pursuant to Section 8(a) and by the Company
in the case of parties indemnified pursuant to Section 8(c). The respective
indemnity and contribution agreements by the Underwriters and the Company
contained in Section 8(a), 8(b), and 8(c) and this Section 8 shall be in
addition to any liability which the Underwriters and the Company may otherwise
have.
If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by Section 8(b), the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after
receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. 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 a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
-30-
(e) In order to provide for just and equitable contribution
under the Act in any case in which (i) any Underwriter (or any person who
controls any Underwriter within the meaning of the Act or the Exchange Act)
makes claim for indemnification pursuant to Section 8(a) hereof, but is
judicially determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the denial of the
last right of appeal) that such indemnification may not be enforced in such case
notwithstanding the fact that Section 8(a) provides for indemnification in such
case or (ii) contribution under the Act may be required on the part of any
Underwriter or any such controlling person in circumstances for which
indemnification is provided under Section 8(c), then, and in each such case, the
Company and such Underwriter shall contribute to the aggregate losses, claims,
damages or liabilities to which they may be subject as an indemnifying party
hereunder (after contribution from others) in such proportion so that such
Underwriter is responsible for the portion represented by the percentage that
the underwriting discount appearing on the cover page of the Prospectus bears to
the public offering price appearing thereon and the Company is responsible for
the remaining portion; provided, however, that, in any such case (x) no
Underwriter shall be required to contribute any amount in excess of the
underwriting discount applicable to the Securities purchased by such Underwriter
and (y) no person guilty of a fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to a contribution from any person
who was not guilty of such fraudulent misrepresentation. The amount paid or
payable by an Underwriter as a result of this Section 8(e) shall be deemed to
include any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating, preparing to defend or defending any such claim.
(f) Promptly after receipt by any party to this Agreement of
notice of the commencement of any action, suit or proceeding, such party will,
if a claim for contribution in respect thereof is to be made against another
party (the "contributing party"), notify the contributing party of the
commencement thereof; but the omission so to notify the contributing party will
not relieve it from any liability which it may have to any other party for
contribution under the Act except to the extent it was unaware of such action
and has been prejudiced in any material respect by such failure or from any
liability which it may have to any other party other than for contribution under
the Act. In case any such action, suit or proceeding is brought against any
party, and such party notifies a contributing party of the commencement thereof,
the contributing party will be entitled to participate therein with the
notifying party and any other contributing party similarly notified.
9. (a) If any Underwriter shall default in its obligation to purchase
the Firm Securities which it has agreed to purchase hereunder, you may in your
discretion arrange for you or another party or other parties to purchase such
Firm Securities on the terms contained herein. If the aggregate number of Firm
Securities as to which Underwriters default is more than one-eleventh of the
aggregate principal amount of the Firm Securities and within 36 hours after such
default by any Underwriter you do not arrange for the purchase of such Firm
Securities, then the Company shall be entitled to a further period of 36 hours
within which to procure another party or other parties satisfactory to you to
purchase such Firm Securities on such terms. In the event that, within the
respective prescribed periods, you notify the Company that you have so arranged
for the purchase of such Firm Securities, or the Company notifies you that it
has so arranged for the purchase of such Firm Securities, you or the Company
shall have the right to postpone the Time of Delivery for a period of not more
than 7 days, in order to effect whatever changes may thereby be made necessary
in the Original Registration Statement, any Rule 462(b) Registration Statement
or the Prospectus or in any other documents or arrangements, and the Company
agrees to file promptly any amendments to the Original Registration Statement,
any Rule 462(b) Registration Statement or the Prospectus which in your opinion
may thereby be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with the like effect as
if such person had originally been a party to this Agreement with respect to
such Firm Securities.
(b) If, after giving effect to any arrangements for the
purchase of the Firm Securities of such defaulting Underwriter or Underwriters
by you or the Company or both as provided in subsection (a) above, the aggregate
principal amount of Firm Securities which remain unpurchased does not exceed
one-eleventh of the aggregate principal amount of the Firm Securities, then the
Company shall have the right to require each non-defaulting Underwriter to
purchase the principal amount of Firm Securities which such Underwriter agreed
to
-31-
purchase hereunder and, in addition, to require each non-defaulting Underwriter
to purchase its pro rata share (based on the principal amount of Firm Securities
which such Underwriter agreed to purchase hereunder) of the Firm Securities of
such defaulting Underwriter or Underwriters for which such arrangements have not
been made; but nothing shall relieve a defaulting Underwriter from liability for
its default.
(c) If, after giving effect to any arrangements for the
purchase of the Firm Securities of a defaulting Underwriter or Underwriters by
you or the Company as provided in subsection (a) above, the aggregate principal
amount of Firm Securities which remain unpurchased exceeds one-eleventh of the
aggregate principal amount of all the Firm Securities, or if the Company shall
not exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Firm Securities of a defaulting
Underwriter or Underwriters, then this Agreement shall thereupon terminate
without liability on the part of any non-defaulting Underwriter or the Company
and, except for the expenses to be borne by the Company and the Underwriters as
provided in Section 6 hereof and the indemnity agreement in Section 8 hereof;
but nothing herein shall relieve a defaulting Underwriter from liability for its
default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or an officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Securities.
11. This Agreement may be terminated with respect to the Firm
Securities or any Option Securities in the sole discretion of the Underwriters
by notice to the Company given prior to the Time of Delivery or Option
Securities Delivery Date, as the case may be, 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 Time of Delivery or Option Securities Delivery
Date, as the case may be, there shall have occurred any material adverse change
in the financial or securities markets in the United States or elsewhere, or in
political, financial or economic conditions in the United States or any country
in which the Company has existing broadcast operations, or any outbreak or
material escalation of hostilities or other calamity or crisis, the effect of
which is such as to make it, in the judgment of the Representatives,
impracticable to market the Securities or to enforce contracts for the resale of
Securities or if any event shall have occurred resulting in (1) trading in
securities generally on the New York Stock Exchange being suspended or limited
or minimum or maximum prices being generally established on such exchange, (2)
trading in the Common Stock shall have been suspended by the Commission or the
Nasdaq National Market, (3) additional material governmental restrictions, not
in force on the date of this Agreement, being imposed upon trading in securities
generally by such exchange or by order of the Commission or any court or other
governmental authority, (4) a general banking moratorium being declared by
either Federal or New York authorities, or (5) the bringing of an action or
proceeding against any of the Company's Subsidiaries which, if determined
adversely to such Subsidiary, could result in the revocation, modification,
nonrenewal or suspension of any of the Licenses, or the imposition of any
administrative sanction which could result in the loss or material curtailment
of the right of any of the Company's Subsidiaries to conduct commercial
broadcast operations in any of the jurisdictions in which the Company is
presently operating.
12. This Agreement shall become effective (a) if the Registration
Statement has not heretofore become effective, at the earlier of 12:00 Noon, New
York City time, on the first full business day after the Registration Statement
becomes effective, or at such time after the Registration Statement becomes
effective as you may authorize the sale of the Securities to the public by the
Underwriters or other securities dealers, or (b) if the Registration Statement
has heretofore become effective, at the earlier of 24 hours after the filing of
the Prospectus with the Commission or at such time as you may authorize the sale
of the Securities to the public by the Underwriters or securities dealers,
unless, prior to any such time you shall have received notice from the Company
that it elects that this Agreement shall not become effective, or you, or
through you such of the Underwriters as
-32-
have agreed to purchase in the aggregate fifty percent or more of the aggregate
principal amount of the Firm Securities hereunder, shall have given notice to
the Company that you or such Underwriters elect that this Agreement shall not
become effective; provided, however, that the provisions of this Section and
Section 6 and Section 8 hereof shall at all times be effective.
If this Agreement shall be terminated pursuant to Section 9 or 11
hereof, or if this Agreement, by election of you or the Underwriters, shall not
become effective pursuant to the provisions of this Section, the Company shall
not then be under any liability to any Underwriter except as provided in Section
6 and Section 8 hereof, but if this Agreement becomes effective and is not so
terminated but the Securities are not delivered by or on behalf of the Company
as provided herein because the Company has been unable for any reason beyond its
control and not due to any default by it to comply with the terms and conditions
hereof, the Company will reimburse the Underwriters through you, for all
out-of-pocket expenses approved in writing by you, including fees and
disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of the Securities, but the
Company shall then be under no further liability to any Underwriters, except as
provided in Section 6 and Section 8 hereof.
13. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter, if the
same shall have been made or given by you.
All statements, requests, notices and agreements hereunder shall be in
writing or by written telecommunication, and shall be sufficient in all respects
if delivered or sent by registered mail, if to the Underwriters, to the
Representatives, c/x Xxxxxxxx Xxxxxxxx & Co. Incorporated at 000 Xxxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx, 00000, Attention: Syndicate Department; provided, however,
that any notice to any Underwriter pursuant to Section 8(d) hereof shall be
delivered or sent by registered mail to such Underwriter at its address set
forth in its Underwriters' Questionnaire delivered to the Company; and if to the
Company, to the Company at 00 X'Xxxxxx Xxxxxx, Xxxxxx X0X 0XX Xxxxxxx,
Attention: General Counsel.
14. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and, to the extent provided in Section
8 and Section 10 hereof, the officers and directors of the Company and each
person who controls the Company or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No purchaser of
any of the Securities from any Underwriters shall be deemed a successor or
assign by reason merely of such purchase.
15. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York (without reference to the conflicts of
laws provisions thereof).
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
-33-
If the forgoing is in accordance with your understanding, please sign
and return to us a counterpart hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement among each of the Underwriters and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Underwriters is pursuant to the authority set forth in a form of Agreement Among
Underwriters, manually or facsimile executed counterparts of which, to the
extent practicable and upon request, shall be submitted to the Company for
examination, but without warranty on your part as to the authority of the
signers thereof.
Very truly yours,
CENTRAL EUROPEAN MEDIA
ENTERPRISES LTD.
By: _________________________________
Name: Xxxx X. Xxxxxxxxx
Title:
Accepted as of the date hereof,
by:
SCHRODER XXXXXXXX & CO. INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
XXXXX XXXXXX INC.
By: Schroder Xxxxxxxx & Co. Incorporated
By: ______________________________
Managing Director
For themselves and as Representatives
of the Underwriters
-34-
SCHEDULE I
Underwriter Principal Amount of Notes
Schroder Xxxxxxxx & Co. Incorporated............................................
Prudential Securities Incorporated..............................................
Xxxxx Xxxxxx Inc................................................................
Total..................................................................$
