EXHIBIT 1.1
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HEARST-ARGYLE TELEVISION INC.
(a Delaware corporation)
Series A Common Stock
PURCHASE AGREEMENT
Dated: November 5, 1997
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TABLE OF CONTENTS
Page
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SECTION 1. Representations and Warranties....................... 4
(a) Representations and Warranties by the Company............ 4
(1) Compliance with Registration Requirements........... 4
(2) Incorporated Documents.............................. 5
(3) Independent Accountants............................. 5
(4) Financial Statements................................ 5
(5) No Material Adverse Change in Business.............. 6
(6) Good Standing of the Company........................ 6
(7) Good Standing of Subsidiaries....................... 7
(8) Capitalization...................................... 7
(9) Authorization of this Underwriting Agreement
and Terms Agreement................................. 7
(10) Authorization of Common Stock...................... 8
(11) Description of the Common Stock.................... 8
(12) Absence of Defaults and Conflicts.................. 8
(13) Absence of Labor Dispute........................... 9
(14) Absence of Proceedings............................. 9
(15) Accuracy of Exhibits............................... 10
(16) Absence of Further Requirements.................... 10
(17) Possession of Intellectual Property................ 10
(18) Possession of Licenses and Permits................. 11
(19) Title to Property.................................. 11
(20) Investment Company Act............................. 11
(21) Environmental Laws................................. 11
(22) Compliance with Cuba Act........................... 12
(23) Registration Rights................................ 12
(24) Affiliation Agreements............................. 12
(b) Officers' Certificates................................... 12
SECTION 2. Sale and Delivery to Underwriters; Closing........... 13
(a) Underwritten Securities.................................. 13
(b) Option Underwritten Securities........................... 13
(c) Payment.................................................. 14
(d) Denominations; Registration.............................. 14
SECTION 3. Covenants of the Company............................. 15
(a) Compliance with Securities Regulations and
Commission Requests...................................... 15
(b) Filing Amendments........................................ 15
(c) Compliance with Securities Laws.......................... 15
(d) Earnings Statement....................................... 16
(e) Delivery of Registration Statements and Prospectuses..... 16
(f) Blue Sky Qualifications.................................. 16
(g) Delivery of Documents.................................... 17
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(h) Use of Proceeds.......................................... 17
(i) Reporting Requirements................................... 17
(j) Listing.................................................. 17
(k) Restriction on Sale of Securities........................ 17
(l) Compliance with NASD Rules............................... 17
SECTION 4. Payment of Expenses.................................. 18
(a) Expenses................................................. 18
(b) Termination of Agreement................................. 19
SECTION 5. Conditions of Underwriters' Obligations.............. 19
(a) Effectiveness of Registration Statement.................. 19
(b) Material Adverse Changes................................. 20
(c) Opinion of Counsel for Company........................... 20
(d) Opinion of FCC Counsel................................... 23
(e) Opinion of Counsel of Underwriters....................... 25
(f) Officers' Certificate.................................... 25
(g) Ernst & Young Comfort Letter............................. 25
(h) Ernst & Young Bring-down Comfort Letter.................. 27
(i) Deloitte & Touche Comfort Letter......................... 27
(j) Deloitte & Touche Bring-down Comfort Letter.............. 30
(k) Approval of Listing...................................... 30
(l) No Objection............................................. 30
(m) Lock-up Agreement........................................ 30
(n) Over-Allotment Option.................................... 30
(o) Additional Documents..................................... 31
(p) Termination of Terms Agreement........................... 31
SECTION 6. Indemnification...................................... 32
(a) Indemnification by the Company........................... 32
(b) Indemnification of Company, Directors and
Officers................................................. 34
(c) Actions against Parties; Notification.................... 34
(d) Settlement without Consent if Failure to
Reimburse................................................ 35
(e) Indemnification for Reserved Securities.................. 35
SECTION 7. Contribution........................................ 35
SECTION 8. Representations, Warranties and Agreements
to Survive Delivery................................. 37
SECTION 9. Termination......................................... 37
(a) Underwriting Agreement................................... 37
(b) Terms Agreement.......................................... 38
(c) Liabilities.............................................. 38
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SECTION 10. Default by One or More of the Underwriters.......... 38
SECTION 11. Notices............................................. 39
SECTION 12. Parties............................................. 39
SECTION 13. GOVERNING LAW AND TIME.............................. 40
SECTION 14. Effect of Headings.................................. 40
SECTION 15. Representation of Underwriters...................... 40
SECTION 16. Counterparts 40
HEARST-ARGYLE TELEVISION, INC.
(a Delaware corporation)
Series A Common Stock
PURCHASE AGREEMENT
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XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Hearst-Argyle Television, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell up to 11,500,000 shares of its shares of Series A
Common Stock, par value $.01 per share (the "Common Stock"), from time to time,
in or pursuant to one or more offerings on terms to be determined at the time of
sale. As used herein, "Securities" shall mean the Common Stock.
Whenever the Company determines to make an offering of Securities through
Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
("Xxxxxxx Xxxxx"), or through an underwriting syndicate managed by Xxxxxxx
Xxxxx, the Company will enter into an agreement (each, a "Terms Agreement")
providing for the sale of such Securities to, and the purchase and offering
thereof by, Xxxxxxx Xxxxx and such other underwriters, if any, selected by
Xxxxxxx Xxxxx (the "Underwriters", which term shall include Xxxxxxx Xxxxx,
whether acting as sole Underwriter or as a member of an underwriting syndicate,
as well as any Underwriter substituted pursuant to Section 10 hereof). The
Terms Agreement relating to the offering of Securities shall specify the number
of Securities to be initially issued (the "Initial Underwritten Securities"),
the name of each Underwriter participating in such offering (subject to
substitution as provided in Section 10 hereof) and the name of any Underwriter
other xxxx Xxxxxxx Xxxxx acting as co-manager in connection with such offering,
the number of Initial Underwritten Securities which each such Underwriter
severally agrees to purchase, whether such offering is on a fixed or variable
price basis and, if on a fixed price basis,
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the initial offering price, the price at which the Initial Underwritten
Securities are to be purchased by the Underwriters, the form, time, date and
place of delivery and payment of the Initial Underwritten Securities and any
other material variable terms of the Initial Underwritten Securities. In
addition, if applicable, such Terms Agreement shall specify whether the Company
has agreed to grant to the Underwriters an option to purchase additional
Securities to cover over-allotments, if any, and the number of Securities
subject to such option (the "Option Underwritten Securities"). As used herein,
the term "Underwritten Securities" shall include the Initial Underwritten
Securities and all or any portion of any Option Underwritten Securities. The
Terms Agreement, which shall be substantially in the form of Exhibit A hereto,
may take the form of an exchange of any standard form of written
telecommunications between the Company and Xxxxxxx Xxxxx, acting for itself and,
if applicable, as representative of any other Underwriters. Unless otherwise
provided for, each offering of Underwritten Securities through Xxxxxxx Xxxxx as
sole Underwriter or through an underwriting syndicate managed by Xxxxxxx Xxxxx
will be governed by this Underwriting Agreement, as supplemented by the
applicable Terms Agreement.
The Company and the Underwriters agree that up to the number of shares of
the Securities specified in the applicable Terms Agreement (the "Reserved
Securities") shall be reserved for sale by the Underwriters to certain eligible
employees and persons having business relationships with the Company, as part of
the distribution of the Securities by the Underwriters, subject to the terms of
this Underwriting Agreement and the applicable Terms Agreement, the applicable
rules, regulations and interpretations of the National Association of Securities
Dealers, Inc. (the "NASD") and all other applicable laws, rules and regulations.
To the extent that such Reserved Securities are not orally confirmed for
purchase by such eligible employees and persons having business relationships
with the Company by the end of the first business day after the date of the
applicable Terms Agreement, such Reserved Securities may be offered to the
public as part of the public offering contemplated by such Terms Agreement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (file no. 333-36659) and pre-
effective amendment no. 1 thereto for the registration of the Securities under
the Securities Act of 1933, as amended (the "1933 Act"), and the offering
thereof from time to time in accordance with Rule 415 of the rules and
regulations of the Commission under the 1933 Act (the "1933 Act Regulations"),
and the Company has filed such post-effective amendments thereto as may be
required prior to the execution of the applicable Terms Agreement. Such
registration statement, as so amended, has been declared effective by the
Commission. Such registration statement, as so amended,
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including the information, if any, deemed to be part thereof pursuant to Rule
430A of the 1933 Act Regulations (the "Rule 430A Information") or Rule 434(d) of
the 1933 Act Regulations (the "Rule 434 Information"), is referred to herein as
the "Registration Statement"; and the final prospectus and the final prospectus
supplement relating to the offering of the Underwritten Securities, in the form
furnished to the Underwriters by the Company for use in connection with the
offering of the Underwritten Securities, are collectively referred to herein as
the "Prospectus"; provided, however, that all references to the "Registration
Statement" and the "Prospectus" shall also be deemed to include all documents
incorporated therein by reference pursuant to the Securities Exchange Act of
1934, as amended (the "1934 Act"), prior to the execution of the applicable
Terms Agreement; provided, further, that if the Company files a registration
statement with the Commission pursuant to Rule 462(b) of the 1933 Act
Regulations (the "Rule 462 Registration Statement"), then, after such filing,
all references to "Registration Statement" shall also be deemed to include the
Rule 462 Registration Statement; and provided, further, that if the Company
elects to rely upon Rule 434 of the 1933 Act Regulations, then all references to
"Prospectus" shall also be deemed to include the final or preliminary prospectus
and the applicable term sheet or abbreviated term sheet (the "Term Sheet"), as
the case may be, in the form first furnished to the Underwriters by the Company
in reliance upon Rule 434 of the 1933 Act Regulations, and all references in
this Underwriting Agreement to the date of the Prospectus shall mean the date of
the Term Sheet. A "preliminary prospectus" shall be deemed to refer to any
prospectus used before the registration statement became effective and any
prospectus that omitted, as applicable, the Rule 430A Information, the Rule 434
Information or other information to be included upon pricing in a form of
prospectus filed with the Commission pursuant to Rule 424(b) of the 1933 Act
Regulations, that was used after such effectiveness and prior to the execution
and delivery of the applicable Terms Agreement. For purposes of this
Underwriting Agreement, all references to the Registration Statement,
Prospectus, Term Sheet or preliminary prospectus or to any amendment or
supplement to any of the foregoing shall be deemed to include any copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval System ("XXXXX").
All references in this Underwriting Agreement to financial statements and
schedules and other information which is "contained," "included" or "stated" (or
other references of like import) in the Registration Statement, Prospectus or
preliminary prospectus shall be deemed to mean and include all such financial
statements and schedules and other information which is incorporated by
reference in the Registration Statement, Prospectus or preliminary prospectus,
as the case may be; and all references in this Underwriting Agreement to
amendments or
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supplements to the Registration Statement, Prospectus or preliminary prospectus
shall be deemed to mean and include the filing of any document under the 1934
Act which is incorporated by reference in the Registration Statement, Prospectus
or preliminary prospectus, as the case may be.
SECTION 1. Representations and Warranties.
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(a) Representations and Warranties by the Company. The Company
represents and warrants to Xxxxxxx Xxxxx, as of the date hereof, and to each
Underwriter named in the applicable Terms Agreement, as of the date thereof, as
of the Closing Time (as defined below) and, if applicable, as of each Date of
Delivery (as defined below)(in each case, a "Representation Date"), as follows:
(1) Compliance with Registration Requirements. The Company meets the
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requirements for use of Form S-3 under the 1933 Act. Each of the Registration
Statement and any Rule 462(b) Registration Statement has become effective under
the 1933 Act and no stop order suspending the effectiveness of the Registration
Statement or any Rule 462(b) Registration Statement has been issued under the
1933 Act and no proceedings for that purpose have been instituted or are pending
or, to the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto (including the
filing of the Company's most recent Annual Report on Form 10-K with the
Commission) became effective and at each Representation Date, the Registration
Statement, any Rule 462(b) Registration Statement and any amendments and
supplements thereto complied and will comply in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations 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. At the date of the Prospectus, at the Closing Time and at each
Date of Delivery, if any, the Prospectus and any amendments and supplements
thereto did not and will not include an untrue statement of a material fact or
omit 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.
If the Company elects to rely upon Rule 434 of the 1933 Act Regulations, the
Company will comply with the requirements of Rule 434. Notwithstanding the
foregoing, the representations and warranties in this subsection shall not apply
to statements in or omissions from the Registration Statement or the Prospectus
made in reliance upon and in conformity with information furnished to the
Company in
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writing by any Underwriter through Xxxxxxx Xxxxx expressly for use in the
Registration Statement or the Prospectus.
Each preliminary prospectus and prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment thereto,
or filed pursuant to Rule 424 under the 1933 Act, complied when so filed in all
material respects with the 1933 Act Regulations and, if applicable, each
preliminary prospectus and the Prospectus delivered to the Underwriters for use
in connection with the offering of Underwritten Securities will, at the time of
such delivery, be identical to any electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(2) Incorporated Documents. The documents incorporated or deemed to
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be incorporated by reference in the Registration Statement and the Prospectus,
at the time they were or hereafter are filed with the Commission, complied and
will comply in all material respects with the requirements of the 1934 Act and
the rules and regulations of the Commission thereunder (the "1934 Act
Regulations") and, when read together with the other information in the
Prospectus, at the date of the Prospectus, at the Closing Time and at each Date
of Delivery, if any, did not and will not include an untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(3) Independent Accountants. The accountants who certified the
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financial statements and any supporting schedules thereto included in the
Registration Statement and the Prospectus are independent public accountants as
required by the 1933 Act and the 1933 Act Regulations.
(4) Financial Statements. The financial statements of the Company
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included in the Registration Statement and the Prospectus, together with the
related schedules and notes, as well as those financial statements, schedules
and notes of any other entity included therein, present fairly the financial
position of the Company and its consolidated subsidiaries, or such other entity,
as the case may be, at the dates indicated and the statement of operations,
stockholders' equity and cash flows of the Company and its consolidated
subsidiaries, or such other entity, as the case may be, for the periods
specified. Such financial statements have been prepared in conformity with
generally accepted accounting principles ("GAAP") applied on a consistent basis
throughout the periods involved. The supporting schedules, if any, included in
the Registration Statement and the Prospectus present fairly in accordance with
GAAP the information required to be stated therein. The selected financial data
and the summary financial
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information included in the Prospectus present fairly the information shown
therein and have been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement and the Prospectus.
In addition, any pro forma financial statements of the Company and its
subsidiaries and the related notes thereto included in the Registration
Statement and the Prospectus present fairly the information shown therein, have
been prepared in accordance with the applicable requirements of the 1933 Act
Regulations with respect to pro forma financial statements and the assumptions
used in the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances referred to
therein.
(5) No Material Adverse Change in Business. Since the respective
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dates as of which information is given in the Prospectus, except as otherwise
stated therein, (A) there has been no material adverse change in the condition,
financial or otherwise, or in the earnings, or business affairs of the Company
and its subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business (a "Material Adverse Effect"), (B) there have been
no transactions entered into by the Company or any of its subsidiaries, other
than those arising in the ordinary course of business, which would have a
Material Adverse Effect and (C) except for regular dividends on the Company's
common stock or preferred stock, in amounts per share that are consistent with
past practice or the applicable charter document or supplement thereto,
respectively, and except in connection with the Hearst Transaction (as defined
in the Registration Statement) there has been no dividend or distribution of any
kind declared, paid or made by the Company on any class of its capital stock.
(6) Good Standing of the Company. The Company has been duly
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incorporated and is an existing corporation in good standing under the laws of
the State of Delaware, with corporate power and authority to own, lease and
operate its properties and conduct its business as described in the Prospectus;
and the Company is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such qualification, except
where failure to so qualify would not result in a Material Adverse Effect.
(7) Good Standing of Subsidiaries. Each direct and indirect
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subsidiary of the Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus and is
duly qualified as a foreign corporation to transact business and
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is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify or be in good
standing would not result in a Material Adverse Effect. Except as otherwise
stated in the Registration Statement and the Prospectus, all of the issued and
outstanding capital stock of each direct and indirect subsidiary of the Company
has been duly authorized and is validly issued, fully paid and non-assessable
and, except as described in the Prospectus, is owned by the Company, directly or
through its subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim, defect or equity. None of the outstanding
shares of capital stock of any direct or indirect subsidiary of the Company was
issued in violation of preemptive or other similar rights of any securityholder
of such subsidiary.
(8) Capitalization. If the Prospectus contains a "Capitalization"
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section, the authorized, issued and outstanding shares of capital stock of the
Company is as set forth in the column entitled "Actual" under such section
(except for subsequent issuances thereof, if any, contemplated under this
Underwriting Agreement or in the Registration Statement, pursuant to
reservations, agreements or employee benefit plans referred to in the Prospectus
or pursuant to the exercise of convertible securities or options referred to in
the Prospectus). Such shares of capital stock have been duly authorized and
validly issued by the Company and are fully paid and non-assessable, and none of
such shares of capital stock was issued in violation of preemptive or other
similar rights of any securityholder of the Company.
(9) Authorization of this Underwriting Agreement and Terms Agreement.
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This Underwriting Agreement has been, and the applicable Terms Agreement as of
the date thereof will have been, duly authorized, executed and delivered by the
Company.
(10) Authorization of Common Stock. The Underwritten Securities have
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been, or as of the date of such Terms Agreement will have been, duly authorized
by the Company for issuance and sale pursuant to this Underwriting Agreement and
such Terms Agreement. The Underwritten Securities, when issued and delivered by
the Company pursuant to this Underwriting Agreement and such Terms Agreement
against payment of the purchase price therefor specified in such Terms
Agreement, will be validly issued, fully paid and non-assessable and will not be
issued in violation of any preemptive or other similar rights of any
securityholder of the Company.
(11) Description of the Common Stock. The Underwritten Securities
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being sold pursuant to the applicable Terms Agreement, when issued and delivered
will conform in all
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material respects to the statements relating thereto contained or incorporated
by reference in the Prospectus.
(12) Absence of Defaults and Conflicts. Neither the Company nor any
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of its subsidiaries is in violation of its charter or by-laws or in default in
the performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which it or any of them may
be bound, or to which any of the property or assets of the Company or any of its
subsidiaries is subject (collectively, "Agreements and Instruments"), except for
such violations or defaults that, singly or in the aggregate, would not result
in a Material Adverse Effect. The execution, delivery and performance of this
Underwriting Agreement, the applicable Terms Agreement and any other agreement
or instrument entered into or issued or to be entered into or issued by the
Company in connection with the transactions contemplated hereby or thereby or in
the Registration Statement and the Prospectus and the consummation of the
transactions contemplated therein and in the Registration Statement and the
Prospectus (including the issuance and sale of the Underwritten Securities and
the use of the proceeds from the sale of the Underwritten Securities as
described under the caption "Use of Proceeds") and compliance by the Company
with its obligations hereunder and thereunder have been duly authorized by all
necessary corporate action and do not and will not, whether with or without the
giving of notice or passage of time or both, (i) conflict with or constitute a
breach of, or default or Repayment Event (as defined below) under, or result in
the creation or imposition of any lien, charge or encumbrance upon any assets,
properties or operations of the Company or any of its subsidiaries pursuant to,
any Agreements and Instruments, except for such conflicts, breaches, defaults,
events or liens, charges or encumbrances that, singly or in the aggregate, would
not result in a Material Adverse Effect; (ii) violate the certificate of
incorporation or by-laws of the Company or any of its subsidiaries; (iii)
violate or conflict with any judgment, order or decree of any United States
governmental body, agency or court having jurisdiction over the Company or any
of its subsidiaries, including, without limitation, the Federal Communications
Commission (the "FCC") or with any United States federal or state law, rule or
regulation applicable to the Company, any of its subsidiaries, or any of their
respective properties, including, without limitation, the Communications Act of
1934, as amended (the "Communications Act"), and the rules and regulations of
the FCC thereunder, except for such violations or conflicts that, singly or in
the aggregate, would not result in a Material Adverse Effect; or (iv) result in
the termination or revocation of any of the permits, licenses, approvals,
orders, certificates, franchises or authorizations of United States governmental
or regulatory
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authorities, including those relating to the Communications Act, owned or held
by the Company or any of its subsidiaries in order to conduct the broadcast
operations of the stations owned or operated by any of them (collectively, the
"Licenses") or result in any other material impairment of the rights of the
holder of any such License, except for such Licenses the failure of which to
maintain or possess by the Company or any of its subsidiaries would not result
in a Material Adverse Effect. As used herein, a "Repayment Event" means any
event or condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf) the
right to require the repurchase, redemption or repayment of all or a portion of
such indebtedness by the Company or any of its subsidiaries.
(13) Absence of Labor Dispute. No labor dispute with the employees of
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the Company or any of its subsidiaries exists or, to the knowledge of the
Company, is imminent, and the Company is not aware of any existing or imminent
labor disturbance by the employees of any of its or any subsidiary's principal
suppliers, manufacturers, customers or contractors, which, in either case, may
reasonably be expected to result in a Material Adverse Effect.
(14) Absence of Proceedings. There is no action, suit, proceeding,
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inquiry or investigation before or brought by any court or governmental agency
or body, domestic or foreign, now pending, or to the knowledge of the Company
threatened, against or affecting the Company or any of its subsidiaries which is
required to be disclosed in the Registration Statement and the Prospectus (other
than as stated therein), or which would reasonably be expected to result in a
Material Adverse Effect or materially and adversely affect the consummation of
the transactions contemplated under this Underwriting Agreement or the
applicable Terms Agreement or the performance by the Company of its obligations
hereunder and thereunder. The aggregate of all pending legal or governmental
proceedings to which the Company or any of its subsidiaries is a party or of
which any of their respective assets, properties or operations is the subject
which are not described in the Registration Statement and the Prospectus,
including ordinary routine litigation incidental to the business, could not
reasonably be expected to result in a Material Adverse Effect.
(15) Accuracy of Exhibits. There are no contracts or documents which
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are required to be described in the Registration Statement, the Prospectus or
the documents incorporated by reference therein or to be filed as exhibits
thereto which have not been so described and filed as required.
(16) Absence of Further Requirements. No filing with, or
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authorization, approval, consent, license, order
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registration, qualification or decree of, any United States federal or state
court or governmental authority or agency, domestic or foreign, is necessary or
required for the performance by the Company of its obligations under this
Underwriting Agreement or the applicable Terms Agreement or in connection with
the transactions contemplated under this Underwriting Agreement or such Terms
Agreement, except such as have been already obtained or as may be required under
the 1934 Act, the 1934 Act Regulations, state securities laws or the by-laws and
rules of the NASD.
(17) Possession of Intellectual Property. The Company and its
-----------------------------------
subsidiaries own or possess, or can acquire on reasonable terms, adequate
patents, patent rights, licenses, inventions, copyrights, know-how (including
trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service marks,
trade names or other intellectual property (collectively, "Intellectual
Property") necessary to carry on the business now operated by them, and neither
the Company nor any of its subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others with
respect to any Intellectual Property or of any facts or circumstances which
would render any Intellectual Property invalid or inadequate to protect the
interest of the Company or any of its subsidiaries therein, and which
infringement or conflict (if the subject of any unfavorable decision, ruling or
finding) or invalidity or inadequacy, singly or in the aggregate, would result
in a Material Adverse Effect.
(18) Possession of Licenses and Permits. The Company and its
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subsidiaries possess or have made application for such Licenses issued by the
appropriate United States federal, state, local or foreign regulatory agencies
or bodies necessary to conduct the business now operated by them, except for
such Licenses the failure of which to obtain, maintain or possess by the Company
or any of its subsidiaries would not have a Material Adverse Effect. The
Company and its subsidiaries are in compliance with the terms and conditions of
all such Governmental Licenses, the Communications Act, and the rules and
regulations of the FCC, except where the failure so to comply would not, singly
or in the aggregate, result in a Material Adverse Effect. All of the Licenses
are valid and in full force and effect, except where the invalidity of such
Licenses to be in full force and effect, singly or in the aggregate, would not
result in a Material Adverse Effect. Neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the revocation
of modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would
result in a Material Adverse Effect. The Company has no reason to believe that
any License will not be renewed in the ordinary course.
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(19) Title to Property. The Company and its subsidiaries have good
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and marketable title or a valid leasehold interest, as the case may be, to all
real property owned or leased by the Company and its subsidiaries and good title
or a valid leasehold interest, as the case may be, to all other properties owned
by them, in each case, free and clear of all mortgages, pledges, liens, security
interests, claims, restrictions or encumbrances of any kind, except (A) as
otherwise stated in the Registration Statement or the Prospectus or (B) those
which would not, singly or in the aggregate have a Material Adverse Effect.
(20) Investment Company Act. The Company is not, and upon the
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issuance and sale of the Underwritten Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus will
not be, an "investment company" within the meaning of the Investment Company Act
of 1940, as amended (the "1940 Act").
(21) Environmental Laws. Except as otherwise stated in the
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Registration Statement and the Prospectus and except as would not, singly or in
the aggregate, result in a Material Adverse Effect, (A) to the knowledge of the
Company, neither the Company nor any of its subsidiaries is in violation of any
federal, state, local or foreign statute, law, rule, regulation, ordinance,
code, policy or rule of common law or any judicial or administrative
interpretation thereof including any judicial or administrative order, consent,
decree or judgment, relating to pollution or protection of human health, the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife, including, without
limitation, laws and regulations relating to the release or threatened release
of chemicals, pollutants, contaminants, wastes, toxic substances, petroleum or
petroleum products (collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Materials (collectively, "Environmental Laws"), (B) to the
knowledge of the Company, the Company and its subsidiaries have all permits,
authorizations and approvals required under any applicable Environmental Laws
and are each in compliance with their requirements, and (C) to the knowledge of
the Company, there are no pending or threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of
noncompliance or violation, investigation or proceedings relating to any
Environmental Law against the Company or any of its subsidiaries.
(22) Compliance with Cuba Act. The Company has complied with, and is
------------------------
and will be in compliance with, the provisions of that certain Florida act
relating to disclosure of
- 12 -
doing business with Cuba, codified as Section 517.075 of the Florida statutes,
and the rules and regulations thereunder or is exempt therefrom.
(23) Registration Rights. Except as disclosed in the Prospectus,
-------------------
there are no contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the 1933 Act with respect to any securities of the
Company owned or to be owned by such person or to require the Company to include
such securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the 1933 Act.
(24) Affiliation Agreements. The affiliation agreements between each
----------------------
of the broadcast television stations of the Company and its subsidiaries, as
applicable, and the ABC and NBC television networks, as applicable, have been
duly authorized, executed and delivered by the Company and its subsidiaries, as
applicable.
(b) Officers' Certificates. Any certificate signed by any officer of
the Company or any of its subsidiaries and delivered to any Underwriter or to
counsel for the Underwriters in connection with the offering of the Underwritten
Securities shall be deemed a representation and warranty by the Company to each
Underwriter as to the matters covered thereby on the date of such certificate
and, unless subsequently amended or supplemented, at each Representation Date
subsequent thereto.
SECTION 2. Sale and Delivery to Underwriters; Closing.
------------------------------------------
(a) Underwritten Securities. The several commitments of the
Underwriters to purchase the Underwritten Securities pursuant to the applicable
Terms Agreement shall be deemed to have been made on the basis of the
representations and warranties herein contained and shall be subject to the
terms and conditions herein set forth.
(b) Option Underwritten Securities. In addition, subject to the terms
and conditions herein set forth, the Company may grant, if so provided in the
applicable Terms Agreement, an option to the Underwriters, severally and not
jointly, to purchase up to the number of the Option Underwritten Securities set
forth therein at a price per Option Underwritten Security equal to the price per
Initial Underwritten Security. Such option, if granted, will expire 30 days
after the date of such Terms Agreement, and may be exercised in whole or in part
from time to time only for the purpose of covering over-allotments which may be
made in connection with the offering and distribution of the Initial
Underwritten Securities upon notice
- 13 -
by Xxxxxxx Xxxxx to the Company setting forth the number or aggregate principal
amount, as the case may be, of Option Underwritten Securities as to which the
several Underwriters are then exercising the option and the time, date and place
of payment and delivery for such Option Underwritten Securities. Any such time
and date of payment and delivery (each, a "Date of Delivery") shall be
determined by Xxxxxxx Xxxxx, but shall not be later than seven full business
days after the exercise of said option, nor in any event prior to the Closing
Time, unless otherwise agreed upon by Xxxxxxx Xxxxx and the Company. If the
option is exercised as to all or any portion of the Option Underwritten
Securities, each of the Underwriters severally and not jointly, will purchase
that proportion of the total number or aggregate principal amount, as the case
may be, of the Option Underwritten Securities then being purchased which the
number or aggregate principal amount, as the case may be, of Initial
Underwritten Securities each such Underwriter has severally agreed to purchase
as set forth in such Terms Agreement bears to the total number or aggregate
principal amount, as the case may be, of Initial Underwritten Securities,
subject to such adjustments as Xxxxxxx Xxxxx in its discretion shall make to
eliminate any sales or purchases of a fractional number or aggregate principal
amount, as the case may be, of Option Underwritten Securities. The Company shall
not be obligated to deliver any of the Securities to be delivered on the Date of
Delivery, except upon payment for all of the Securities to be purchased on such
Date of Delivery provided herein.
(c) Payment. Payment of the purchase price for, and delivery of, the
Initial Underwritten Securities shall be made at the offices of Xxxxxx & Xxxxx,
000 Xxxx Xxxxxx, Xxx Xxxx, X.X. 00000, or at such other place as shall be agreed
upon by Xxxxxxx Xxxxx and the Company, at 10:00 A.M. (Eastern time) on the third
(fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day)
business day after the date of the applicable Terms Agreement (unless postponed
in accordance with the provisions of Section 10 hereof), or such other time not
later than ten business days after such date as shall be agreed upon by Xxxxxxx
Xxxxx and the Company (such time and date of payment and delivery being herein
called "Closing Time"). In addition, in the event that the Underwriters have
exercised their option, if any, to purchase any or all of the Option
Underwritten Securities, payment of the purchase price for, and delivery of such
Option Underwritten Securities, shall be made at the above-mentioned offices of
Xxxxxx & Xxxxx, or at such other place as shall be agreed upon by Xxxxxxx Xxxxx
and the Company, on the relevant Date of Delivery as specified in the notice
from Xxxxxxx Xxxxx to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to bank accounts designated by the Company against delivery to
Xxxxxxx Xxxxx for the respective
- 14 -
accounts of the Underwriters of the Underwritten Securities, if any, to be
purchased by them. It is understood that each Underwriter has authorized Xxxxxxx
Xxxxx, for its account, to accept delivery of, receipt for, and make payment of
the purchase price for, the Underwritten Securities which it has severally
agreed to purchase. Xxxxxxx Xxxxx, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Underwritten Securities to be purchased by any Underwriter whose
funds have not been received by the Closing Time or the relevant Date of
Delivery, as the case may be, but such payment shall not relieve such
Underwriter from its obligations hereunder.
(d) Denominations; Registration. Certificates for the Underwritten
Securities shall be in such denominations and registered in such names as
Xxxxxxx Xxxxx may request in writing at least two full business days prior to
the Closing Time or the relevant Date of Delivery, as the case may be.
Certificates for the Underwritten Securities will be made available for
examination and packaging by Xxxxxxx Xxxxx in The City of New York not later
than 10:00 A.M. (Eastern time) on the business day prior to the Closing Time or
the relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with the
------------------------
several Underwriters in connection with each offering of Underwritten Securities
as follows:
(a) Compliance with Securities Regulations and Commission Requests.
The Company will file the Prospectus with the Commission pursuant to and in
accordance with Rule 424 not later than the second business day following the
execution and delivery of the Terms Agreement, and the Company, if and as
applicable, will notify Xxxxxxx Xxxxx promptly, and confirm the notice in
writing, of (i) the effectiveness of any post-effective amendment to the
Registration Statement or the filing of any supplement or amendment to the
Prospectus, (ii) the receipt of any comments from the Commission relating to the
Registration Statement or the Prospectus, and (iii) any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information.
(b) Filing Amendments. The Company will advise Xxxxxxx Xxxxx promptly
of any proposal to amend or supplement the Registration Statement or the
Prospectus, will afford Xxxxxxx Xxxxx a reasonable opportunity to comment on any
such proposed amendment or supplement and will not file any such document to
which Xxxxxxx Xxxxx or counsel for the Underwriters reasonably shall object,
except to the extent that such filing is necessary in the opinion of counsel to
the Company in order to comply with the requirements of the 1933 Act and the
1933 Act Regulations;
- 15 -
and the Company will also advise Xxxxxxx Xxxxx promptly of the filing of any
such amendment or supplement and of the institution by the Commission of any
stop order proceedings in respect of the Registration Statement or of any part
thereof and will use reasonable efforts to prevent the issuance of any such stop
order and to obtain as soon as practicable its lifting, if issued.
(c) Compliance with Securities Laws. The Company will comply with the
1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations so
as to permit the completion of the distribution of the Underwritten Securities
as contemplated in this Underwriting Agreement and the applicable Terms
Agreement and in the Registration Statement and the Prospectus. If, at any time
when a Prospectus relating to the Underwritten Securities is required to be
delivered under the 1933 Act in connection with sales by any Underwriter or
dealer, any event occurs as a result of which in the opinion of counsel to the
Company it is necessary to amend or supplement the Prospectus in order that the
Prospectus will not contain an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, or if it is
necessary, in the opinion of counsel to the Company at any time to amend the
Prospectus to comply with the 1933 Act, the Company promptly will notify Xxxxxxx
Xxxxx of such event and will promptly prepare and file with the Commission, at
its own expense, an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance. Neither Xxxxxxx
Xxxxx'x consent to, nor the Underwriters' delivery of, any such amendment or
supplement shall constitute a waiver of any of the conditions set forth in
Section 5.
(d) Earnings Statement. The Company will timely file all such reports
pursuant to the 1934 Act and the 1934 Act Regulations as are necessary in order
to make generally available to its securityholders as soon as practicable (but
not later than 90 days after the close of the Company's current fiscal year (in
form and in a manner complying with Rule 158 of the 1933 Act Regulations) an
earnings statement in order to satisfy the provisions of Section 11(a) of the
1933 Act.
(e) Delivery of Registration Statements and Prospectuses. The Company
will furnish to Xxxxxxx Xxxxx copies of the Registration Statement as originally
filed (including all exhibits thereto), any related preliminary prospectus, any
related preliminary prospectus supplement, the Prospectus and all amendments and
supplements to such documents, in each case as soon as available and in such
quantities as Xxxxxxx Xxxxx reasonably requests, during the period when the
Prospectus is required to be delivered under the 1933 Act, and the Company
hereby consents to the use of such copies for purposes permitted under the 1933
Act. The Company will pay the expenses of
- 16 -
printing and distributing to the Underwriters all such documents, and copies of
these documents furnished to the Underwriters will be identical to any
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
(f) Blue Sky Qualifications. The Company will use its best efforts to
qualify the Underwritten Securities for sale under the laws of such
jurisdictions as Xxxxxxx Xxxxx reasonably designates and will continue such
qualifications in effect for a period of not less than one year from the date of
the applicable Terms Agreement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject or make any change
in its charter, certificate of incorporation, by-laws or other governing
documents. In each jurisdiction in which the Underwritten 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 such qualification in
effect for such period in order to effect the distribution of the Underwritten
Securities.
(g) Delivery of Documents. During the period until three years after
the date of any Terms Agreement, the Company will furnish to Xxxxxxx Xxxxx and,
upon request, to each of the other Underwriters, if any, as soon as practicable
after the end of each fiscal year, a copy of its annual report to stockholders
for such year; and the Company will furnish to Xxxxxxx Xxxxx (i) as soon as
available, a copy of each report and any definitive proxy statement of the
Company filed with the Commission under the 1934 Act or mailed to stockholders,
and (ii) from time to time, such other information concerning the Company as
Xxxxxxx Xxxxx may reasonably request.
(h) Use of Proceeds. The Company will use the net proceeds received
by it from the sale of the Underwritten Securities in the manner specified in
the Prospectus under "Use of Proceeds".
(i) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
(j) Listing. The Company will use it best efforts to effect the
listing of the Underwritten Securities, prior to the
- 17 -
Closing Time, on any national securities exchange or quotation system if and as
specified in the applicable Terms Agreement.
(k) Restriction on Sale of Securities. Between the date of the
applicable Terms Agreement and the Closing Time or such other date specified in
such Terms Agreement, the Company will not, without the prior written consent of
Xxxxxxx Xxxxx, directly or indirectly, issue, sell or offer to sell, grant any
option for sale of, or otherwise dispose, of the securities specified in such
Terms Agreement, subject to the conditions and exceptions described therein.
(l) Compliance with NASD Rules. The Company hereby agrees that it
will ensure that the Reserved Securities will be restricted as required by the
NASD or the NASD rules from sale, transfer, assignment, pledge or hypothecation
for a period of three months following the date of this Agreement. The
Underwriters will notify the Company as to which persons will need to be so
restricted. At the request of the Underwriters, the Company will direct the
transfer agent to place a stop transfer restriction upon such securities for
such period of time. Should the Company release, or seek to release, from such
restrictions any of the Reserved Securities, the Company agrees to reimburse the
Underwriters for any reasonable expenses (including, without limitation, legal
expenses) they incur in connection with such release.
SECTION 4. Payment of Expenses.
-------------------
(a) Expenses. The Company will pay all expenses incident to
performance of its obligations under this Underwriting Agreement or the
applicable Terms Agreement, including (i) the preparation, printing and filing
of the Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of the Underwriting Agreement, any Terms
Agreement, and any Agreement among Underwriters, and such other agreements as
may be reasonably required in connection with the offering, purchase, sale,
issuance or delivery of the Underwritten Securities, (iii) the preparation,
issuance and delivery of the Underwritten Securities and certificates for the
Underwritten Securities to the Underwriters, including any transfer taxes and
any stamp or other duties payable upon the sale, issuance or delivery of the
Underwritten Securities to the Underwriters, (iv) the fees and disbursements of
the Company's counsel, accountants and other advisors or agents (including
transfer agents and registrars), (v) the qualification of the Underwritten
Securities under state securities laws in accordance with the provisions of
Section 3(f) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation, printing and
- 18 -
delivery of any Blue Sky Survey and any amendment thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus, any Term
Sheet, and the Prospectus and any amendments or supplements thereto, (vii) the
fees and expenses incurred with respect to the listing of the Underwritten
Securities, (viii) the filing fees incident to, and the reasonable fees and
disbursements of counsel of the Underwriters in connection with, the review, if
any, by the NASD of the terms of the sale of the Underwritten Securities, (ix)
the fees and expenses of any Underwriter acting in the capacity of a "qualified
independent underwriter" (as defined in Section 2(l) of Schedule E of the bylaws
of the NASD), if applicable, and (x) all costs and expenses of the Underwriters,
including the reasonable fees and disbursements of counsel for the Underwriters,
in connection with matters related to the Reserved Securities which are
designated by the Company for sale to employees and others having a business
relationship with the Company. The Underwriters shall pay any transfer taxes on
the Underwritten Securities which they may sell, and the expenses of advertising
any offering of the Underwritten Securities made by the Underwriters.
(b) Termination of Agreement. If the applicable Terms Agreement is
terminated by Xxxxxxx Xxxxx in accordance with the provisions of Section 5 or
Section 9(b)(i) hereof, the Company shall reimburse the Underwriters for all of
their reasonable out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of
---------------------------------------
the Underwriters to purchase and pay for the Underwritten Securities pursuant to
the applicable Terms Agreement are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any of its subsidiaries
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement. The Prospectus shall
have been filed with the Commission in accordance with the 1933 Act Regulations
and Section 3(a) hereof. The Registration Statement, including any Rule 462(b)
Registration Statement, has become effective under the 1933 Act, and no stop
order suspending the effectiveness of the Registration Statement or of any part
thereof shall have been issued under the 1933 Act and no proceedings for that
purpose shall have been instituted or, to the knowledge of the Company or any
Underwriter, shall be contemplated by the Commission, and any request on the
part of the Commission for additional information shall have been complied with
to the reasonable satisfaction of counsel for the Underwriters. A prospectus
containing
- 19 -
information relating to the description of the Underwritten Securities, the
specific method of distribution and similar matters shall have been filed with
the Commission in accordance with Rule 424 of the 1933 Act (or any post-
effective amendment providing such information shall have been filed and
declared effective in accordance with the requirements of Rule 430A), or, if the
Company has elected to rely upon Rule 434 of the 1933 Act Regulations, a Term
Sheet including the Rule 434 Information shall have been filed with the
Commission in accordance with Rule 424(b).
(b) Material Adverse Changes. At the Closing Time, there shall not
have occurred (i) any change, or any development or event involving a
prospective change, in the condition (financial or other), or the earnings,
business affairs, properties or results of operations of the Company or its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business which, in the judgment of a majority in interest of
the Underwriters including Xxxxxxx Xxxxx, is material and adverse and makes it
impractical or inadvisable to proceed with completion of the public offering or
the sale of and payment for the Underwritten Securities; (ii) any suspension or
limitation of trading in securities generally on the Nasdaq National Market
("Nasdaq"), or any setting of minimum prices for trading on Nasdaq, or any
suspension of trading of any securities of the Company on Nasdaq or in the over-
the-counter market; (iii) any banking moratorium declared by U.S. Federal or New
York authorities; or (iv) any outbreak or escalation of major hostilities in
which the United States is involved, any declaration of war by Congress or any
other substantial national or international calamity or emergency if, in the
judgment of a majority in interest of the Underwriters including Xxxxxxx Xxxxx,
the effect of any such outbreak, escalation, declaration, calamity or emergency
on the financial markets of the United States makes it impractical or
inadvisable to proceed with completion of the public offering or the sale of and
payment for the Underwritten Securities.
(c) Opinion of Counsel for Company. At Closing Time, Xxxxxxx Xxxxx
shall have received the favorable opinion, dated as of Closing Time, of Xxxxxx &
Xxxxx, counsel for the Company, in form and substance satisfactory to counsel
for the Underwriters, to the effect that:
(1) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own, lease and operate its properties and
conduct its business as described in the Prospectus;
(2) Each subsidiary of the Company has been duly incorporated and is
validly existing as a corporation in good
- 20 -
standing under the laws of the jurisdiction of its incorporation, and has
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus. Except as otherwise stated
in the Registration Statement and the Prospectus (by incorporation or otherwise)
all of the issued and outstanding shares of capital stock of each subsidiary
have been duly authorized and are validly issued, fully paid and non-assessable
and (except for directors qualifying shares) are owned of record by the Company
directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity to the knowledge of such
counsel. There are no outstanding preemptive or other similar rights of any
securityholder of any subsidiary of the Company with respect to the outstanding
capital stock of such subsidiary arising under the General Corporation Law of
the State of Delaware, the certificate of incorporation or by-laws of the
Company, or, to such counsel's knowledge, any material agreement to which the
Company is a party;
(3) The Underwritten Securities to be sold by the Company have been
duly authorized the Company for issuance and sale pursuant to the Underwriting
Agreement and the applicable Terms Agreement. The Underwritten Securities to be
sold by the Company, when issued and delivered by the Company pursuant to the
Underwriting Agreement and such Terms Agreement against payment of the
consideration therefor specified in such Terms Agreement, will be validly
issued, fully paid and nonassessable and the issuance of such Underwritten
Securities will not be subject to preemptive or other similar rights of any
security holder of the Company arising under the General Corporation Law of the
State of Delaware, the certificate of incorporation or by-laws of the Company,
or, to such counsel's knowledge any material agreement to which the Company is a
party. The form of certificate, if any, used to evidence the Underwritten
Securities will be in due and proper form and complies with the applicable
statutory requirements, with any applicable requirements of the charter or by-
laws of the Company and with the requirements of the Nasdaq National Market.
(4) To such counsel's knowledge, except as disclosed in the
Prospectus, there are no contracts or agreements between the Company and any
person granting such person the right (other than rights which have been waived
or suspended) to require the Company to file a registration statement under the
1933 Act with respect to any securities of the Company owned or to be owned by
such person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration statement filed
by the Company under the 1933 Act;
- 21 -
(5) No consent, approval, authorization or order of, or filing with,
any governmental agency or body or any United States federal or state court is
required for the consummation of the transactions contemplated by the
Underwriting Agreement and the applicable Terms Agreement in connection with the
issuance or sale of the Underwritten Securities by the Company, except such of
the foregoing as may be required in connection with the issuance of sale by the
Company of the Underwritten Securities under the 1933 Act, the 1933 Act
Regulations, the 1934 Act, the 1934 Act Regulations, the By-Laws and rules of
the NASD, or any state securities laws or such as have been received on or prior
to the date hereof;
(6) The execution, delivery and performance of the Underwriting
Agreement and the applicable Term Agreement and the consummation by the Company
of such transactions contemplated thereby, and the issuance and sale of the
Underwritten Securities by the Company will not result in a breach or violation
of any of the terms and provisions of, or constitute a default under, any United
States federal or state statue, rule, regulation or order known to such counsel
of any governmental agency or body (other than foreign or state securities laws
as to which such counsel expresses no view) or any United States federal or
state court having jurisdiction over the Company or any subsidiary of the
Company or any of their properties, of which such counsel is aware, or any
agreement or instrument to which the Company or any such subsidiary is a party
filed or incorporated by reference as an exhibit to the Registration Statement
except for such breaches, violations or defaults which, individually or in the
aggregate, would not have a Material Adverse Effect, or the charter or by-laws
of the Company or any such subsidiary, and the Company has full corporate power
and authority to authorize, issue and sell the Underwritten Securities to be
sold by it as contemplated by the Underwriting Agreement and the applicable
Terms Agreement. Such counsel expresses no opinion in this Paragraph 6 with
respect to (i) any covenant, restriction or provision of any agreement or
instrument regarding financial covenants, ratios or tests or any aspect of the
financial condition or results of operations of the Company or its subsidiaries,
or (ii) the By-Laws or rules of the NASD or any state securities laws;
(7) The Registration Statement has become effective under the 1933
Act, the Prospectus was filed with the Commission pursuant to the subparagraph
of Rule 424(b) of the 1933 Act specified in such opinion on the date specified
therein, and, to the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement or any part thereof has been issued
and no proceedings for that purpose have been instituted or are pending or
contemplated under the 1933 Act;
- 22 -
(8) The Registration Statement relating to the Underwritten
Securities, as of its effective date, the Prospectus, as of the date of the
Terms Agreement, and any amendment or supplement thereto, as of its date (in
each case excluding (i) the documents incorporated by reference therein, (ii)
the operating statistics, financial statements, including the notes thereto, and
other financial statistical data included or incorporated by reference therein
or omitted therefrom, and (iii) the Form T-1, in each case, as to which such
counsel expresses no view) complied as to form in all material respects with the
requirements of the 1933 Act and 1933 Act Regulations;
(9) The Underwriting Agreement and the applicable Terms Agreement
have been duly authorized, executed and delivered by the Company; and
(10) The Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
In rendering such opinion, such counsel may state that is opinion is
limited to matters governed by the Federal laws of the United States of America,
the laws of the State of New York and the General Corporation Law of the State
of Delaware, and that such counsel is not admitted in the State of Delaware. In
rendering such opinion, such counsel may also rely on certificates and written
statements of officers, directors, stockholders, employees and accountants of
the Company and public officials. Such counsel shall also state that nothing
has come to the attention of such counsel that leads it to believe that the
Registration Statement, at the time it became effective, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or
that the Prospectus or any amendment or supplement thereto, at the date of the
Terms Agreement or the date hereof, included or includes an untrue statement of
a material fact or omitted or omits 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 (it being understood that such counsel expresses
no belief with respect to the financial statements, financial schedules and
financial information and operating data, and other financial data included or
incorporated by reference in the Registration Statement or the Prospectus). The
foregoing statement may be qualified by a statement to the effect that such
counsel does not pass upon or otherwise assume any responsibility for the
accuracy, completeness, or fairness of the statements contained in the
Registration Statement or the Prospectus.
(d) Opinion of FCC Counsel. At Closing Time, Xxxxxxx Xxxxx shall
have received the favorable opinion, dated as
- 23 -
of Closing Time, of Brooks, Pierce, XxXxxxxx, Xxxxxxxx & Xxxxxxx, special FCC
counsel for the Company, in form and substance satisfactory to counsel for the
Underwriters, to the effect that:
(1) The execution, delivery and performance of the Underwriting
Agreement and the applicable Terms Agreement will not result in a violation of
the Communications Act or the any order, rule or regulation of the FCC;
(2) No consent, approval, authorization or order of, or filing with,
any governmental body or any court is required under the Communications Act or
the rules and regulations of the FCC is required for the consummation of the
transactions contemplated by the Underwriting Agreement and the applicable Terms
Agreement in connection with the issuance or sale of the Underwritten Securities
by the Company, except such as have been obtained and made under the
Communications Act or the rules and regulations of the FCC;
(3) The FCC has duly and validly taken all necessary action (the "FCC
Consent") to approve the transfer and assignment to the Company of all material
Licenses issued by the FCC with respect to the broadcast television group (the
"Hearst Broadcast Group") of the Hearst Corporation, a Delaware corporation
("Hearst"), and the FCC Consent has not been reversed, stayed, enjoined, set
aside annulled or suspended, no requests have been filed for administrative or
judicial review, reconsideration, appeal or stay of the FCC Consent, and the
time period for the filing of any such requests and for the FCC to set aside the
FCC Consent on its own motion has expired;
(4) The Company and its subsidiaries are the holders of the Licenses
issued by the FCC listed in an attachment to such opinion (the "FCC Licenses"),
all of which are validly issued by the FCC and in full force and effect, with no
material restrictions or qualifications other than as described in the
Prospectus and to the best knowledge of such counsel based solely on the
description of the business and properties of the Company and its subsidiaries
in the Prospectus and given by the Company to such counsel, such FCC Licenses
constitute all of the FCC Licenses necessary for the Company and its
subsidiaries to own their properties and to conduct their businesses in the
manner and to the full extent now operated or proposed to be operated as
described in the Prospectus; and
(5) To the best knowledge of such counsel, no event has occurred
which permits, or with notice or lapse of time or both would permit, the
revocation or non-renewal of any of the FCC Licenses, assuming the filing of
timely license renewal applications and the timely payment of all applicable
filing and regulatory fees to the FCC, or which might result in any other
- 24 -
material impairment of the rights of the Company and its subsidiaries in the FCC
Licenses.
(e) Opinion of Counsel of Underwriters. At Closing Time, Xxxxxxx
Xxxxx shall have received the favorable opinion, dated as of Closing Time, of
Dow, Xxxxxx & Xxxxxxxxx, PLLC, counsel for the Underwriters, together with
signed or reproduced copies of such letter for each of the other Underwriters,
with respect to the incorporation of the Company, the validity of the
Underwritten Securities, certain matters pertaining to the Registration
Statement, the Prospectus and other related matters as the Representatives may
require, and the Company shall have furnished to such counsel such documents as
they request for the purpose of enabling them to pass upon such matters. Such
counsel may also state that, insofar as much opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of officers
of the Company and its subsidiaries and certificates of public officials.
(f) Officers' Certificate. At Closing Time, Xxxxxxx Xxxxx shall have
received a certificate of the President or a Vice President of the Company and
of the chief financial officer or chief accounting officer of the Company,
dated as of Closing Time, to the effect that, to the best of their knowledge,
(i) there has been no material adverse change in the condition, financial or
otherwise, or in the earnings or business affairs of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, (ii) the representations and warranties in Section
1 are true and correct in all material respects with the same force and effect
as though expressly made at and as of the Closing Time, (iii) the Company has
complied in all material respects with all agreements and satisfied under this
Underwriting Agreement and the applicable Terms Agreement all conditions on its
part to be performed or satisfied at or prior to the Closing Time, and (iv) no
stop order suspending the effectiveness of the Registration Statement has bee
issued and no proceedings for that purpose have been initiated or threatened by
the Commission.
(g) Ernst & Young Comfort Letter. At the time of the execution of the
applicable Terms Agreement, Xxxxxxx Xxxxx shall have received from Ernst & Young
LLP a letter dated such date, confirming that they are independent public
auditors within the meaning of the Act and the applicable 1933 Act Regulations
thereunder and stating to the effect that:
(1) in their opinion, the financial statements and any schedules
examined by them and included in the Prospectus comply as to form in all
material respects with the applicable accounting requirements of the 1993 Act
and the related 1933 Act Regulations;
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(2) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim financial
information as described in Statement of Auditing Standards No. 71, Interim
Financial Information, on the unaudited financial statements included in the
Registration Statement;
(3) on the basis of the review referred to in clause (ii) above, a
reading of the latest available interim financial statements of the Company,
inquiries of officials of the Company who have responsibility for financial and
accounting matters and other specified procedures, nothing came to their
attention that caused them to believe that:
(i) the unaudited financial statements included in the Prospectus do
not comply as to form in all material respects with the applicable accounting
requirements of the 1933 Act and the related 1993 Act Regulations or any
material modifications should be made to such unaudited financial statements for
them to be in conformity with generally accepted accounting principles;
(ii) if any unaudited "capsule" information is contained in the
Prospectus, the unaudited consolidated net sales, net operating income, net
income and net income per share amounts or other amounts constituting such
"capsule" information and described in such letter do not agree with the
corresponding amounts set forth in the unaudited consolidated financial
statements or were not determined on a basis substantially consistent with that
of the corresponding amounts in the audited statements of income;
(iii) at the date of the latest available balance sheet read by such
accountants, or at a subsequent specified date not more than five business days
prior to the date of the applicable Terms Agreement, there was any change in the
capital stock or any increase in short-term indebtedness or long-term debt of
the Company and its consolidated subsidiaries or, at the date of the latest
available balance sheet read by such accountants, there was any decrease in
total revenues, as compared with amounts shown on the latest balance sheet
included in the Prospectus; or
(iv) for the period from the closing date of the latest income
statement included in the Prospectus to the closing date of the latest available
income statement read by such accountants there were any decreases, as compared
with the corresponding period of the previous year and with the period of
corresponding length ended the date of the latest income statement included in
the Prospectus, in consolidated net sales,
- 26 -
or in the total or per share amounts of consolidated income before extraordinary
items;
except in all cases set forth in clauses (iii) and (iv) above for
changes, increases or decreases which the Prospectus discloses have occurred or
may occur;
(4) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information contained in
the Prospectus, except for specified dollar amounts and other financial
information for the Hearst Broadcast Group, in each case to the extent that such
dollar amounts, percentages and other financial information are derived from the
general accounting records of the Company and its subsidiaries subject to the
internal controls of the Company's accounting system or are derived directly
from such records by analysis or computation with the results obtained from
inquiries, a reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts, percentages and
other financial information to be in agreement with such results, except as
otherwise specified in such letter.
All financial statements and schedules included in material incorporated by
reference in the Prospectus shall be deemed included in the Prospectus for
purposes of this subsection.
(h) Ernst & Young Bring-down Comfort Letter. At Closing Time, Xxxxxxx
Xxxxx shall have received from Ernst & Young LLP a letter, dated as of Closing
Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (g) of this Section 5, except that the
specified date referred to shall be a date not more than five business days
prior to the Closing Time.
(i) Deloitte & Touche Comfort Letter. At the time of the execution of
the applicable Terms Agreement, Xxxxxxx Xxxxx shall have received from Deloitte
& Touche LLP a letter dated such date, confirming that they are independent
public accountants within the meaning of the 1933 Act and the applicable 1933
Act Regulations thereunder and stating to the effect that:
(1) in their opinion, the financial statements and any summary of
earnings examined by them and included in the Prospectus comply as to form in
all material respects with the applicable accounting requirements of the Act and
the related 1933 Act Regulations;
(2) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim financial
information as described in Statement of Auditing Standards No. 71, Interim
Financial Information, on
- 27 -
the unaudited financial statements examined by them and included in the
Registration Statement;
(3) on the basis of the review referred to in clause (ii) above, a
reading of the latest available interim financial statements of the Hearst
Broadcast Group or the Company, inquiries of officials of Hearst or the Company
who have responsibility for financial and accounting matters and other specified
procedures, nothing came to their attention that caused them to believe that:
(i) the unaudited financial statements and any summary of earnings
included in the Prospectus do not comply as to form in all material respects
with the applicable accounting requirements of the 1933 Act and the related 1933
Act Regulations or any material modifications should be made to such unaudited
financial statements and summary of earnings for them to be in conformity with
generally accepted accounting principles;
(ii) if any unaudited pro forma financial information is contained in
the Prospectus, the unaudited pro forma revenues and broadcast cash flows were
not determined on a basis substantially consistent with that of the
corresponding amounts in the unaudited pro forma statements of operations;
(iii) at the date of the latest available balance sheet read by such
accountants, or at a subsequent specified date not more than three business days
prior to the date of the applicable Terms Agreement, there was any change in the
capital stock or any increase in short-term indebtedness or long-term debt of
the Company and its consolidated subsidiaries or, at the date of the latest
available balance sheet read by such accountants, there was any decrease in
consolidated net current assets, as compared with amounts shown on the unaudited
pro forma balance sheet included in the Prospectus; or
(iv) for the period from the closing date of the latest statement of
operations included in the Prospectus to the closing date of the latest
available statement of operations read by such accountants there were any
decreases, as compared with the corresponding period of the previous year and
with the period of corresponding length ended the date of the latest statement
of operations included in the Prospectus, in consolidated total revenues;
except in all cases set forth in clauses (iii) and (iv) above for
changes, increases or decreases which the Prospectus discloses have occurred or
may occur;
(4) they have compared the disclosure under the caption "Ratio of
Earnings to Fixed Charges" of the Hearst
- 28 -
Broadcast Group and of the Company for the six months ended June 30, 1997 in the
Registration Statement with results obtained from inquiries of officials of
Hearst and the Company, as the case may be, who have responsibility for
financial and accounting matters, a reading of the general accounting records of
the Hearst Broadcast Group or the Company and other procedures specified in such
letter and have found such disclosure to be in agreement with such results,
except as otherwise specified in such letter, and have proved the arithmetic
accuracy of such disclosure; and
(5) they have read the pro forma financial statements of the Company
for the six months ended June 30, 1997 and 1996 contained in the Prospectus,
made inquiries of certain officials of the Company who have responsibility for
financial and accounting matters about the basis for their determination of the
pro forma adjustments and whether the pro forma financial statements comply as
to form in all material respects with the applicable accounting requirements of
Rule 11-02 of Regulation S-X, proved the arithmetic accuracy of the application
of the pro forma adjustments to the historical amounts in the pro forma
financial statements, and on the basis of such procedures and other inquiries
specified in such letter, nothing came to their attention that caused them to
believe that the pro forma financial statements included in the Registration
Statement do not comply as to form in all material respects with the applicable
requirements of Rule 11-02 of Regulation S-X or that the pro forma adjustments
have not been properly applied to the historical amounts in the compilation of
the pro forma financial statements; and
(6) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information regarding the
Hearst Broadcast Group and, subsequent to August 29, 1997, the Company contained
in the Prospectus (in each case to the extent that such dollar amounts,
percentages and other financial information are derived from the general
accounting records of the Hearst Broadcast Group or the Company subject to the
internal controls of Hearst's or the Company's accounting system or are derived
directly from such records by analysis or computation) with the results obtained
from inquiries, a reading of such general accounting records and other
procedures specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with such
results, except as otherwise specified in such letter.
All financial statements and schedules included in material incorporated by
reference in the Prospectus shall be deemed included in the Prospectus for
purposes of this subsection.
- 29 -
(j) Deloitte & Touche Bring-down Comfort Letter. At Closing Time,
Xxxxxxx Xxxxx shall have received from Deloitte & Touche LLP a letter, dated as
of Closing Time, to the effect that they reaffirm the statements made in the
letter furnished pursuant to subsection (i) of this Section 5, except that the
specified date referred to shall be a date not more than three business days
prior to the Closing Time.
(k) Approval of Listing. At Closing Time, the Underwritten Securities
shall have been approved for listing, subject only to official notice of
issuance, if and as specified in the applicable Terms Agreement.
(l) No Objection. If the Registration Statement or an offering of
Underwritten Securities has been filed with the NASD for review, the NASD shall
not have raised any objection with respect to the fairness and reasonableness of
the underwriting terms and arrangements.
(m) Lock-up Agreement. On the date of the applicable Terms Agreement,
Xxxxxxx Xxxxx shall have received, in form and substance satisfactory to it,
each lock-up agreement, if any, specified in such Terms Agreement, subject to
the exceptions, if any, in such Terms Agreement, as being required to be
delivered by the person listed therein.
(n) Over-Allotment Option. In the event that the Underwriters
exercise their option to purchase all or any portion of the Option Underwritten
Securities, the representations and warranties of the Company contained herein
and the statements in any certificates furnished by the Company or any of its
subsidiaries hereunder shall be true and correct in all material respects as of
each Date of Delivery, and, at the relevant Date of Delivery, Xxxxxxx Xxxxx
shall have received:
(1) A certificate, dated such Date of Delivery, of the President or a
Vice President of the Company and the chief financial officer or chief
accounting officer of the Company, confirming that the certificate delivered at
the Closing Time pursuant to Section 5(f) hereof remains true and correct as of
such Date of Delivery.
(2) The favorable opinions of Xxxxxx & Xxxxx and of Brooks, Pierce,
XxXxxxxx, Xxxxxxxx & Xxxxxxx in form and substance reasonably satisfactory to
counsel for the Underwrites, dated such Date of Delivery, relating to the Option
Underwritten Securities and otherwise to the same effect as the opinions
required by Sections 5(c) and 5(d) hereof, respectively.
(3) The favorable opinion of Dow, Xxxxxx & Xxxxxxxxx, PLLC, counsel
for the Underwriters, dated such Date of Delivery, relating to the Option
Underwritten Securities and
- 30 -
otherwise to the same effect as the opinion required by Section 5(e) hereof.
(4) A letter from Ernst & Young LLP, in form and substance reasonably
satisfactory to Xxxxxxx Xxxxx and dated such Date of Delivery, substantially in
the same form and substance as a letter furnished to Xxxxxxx Xxxxx pursuant to
Section 5(g) hereof, except that the "specified date" on the letter furnished
pursuant to this paragraph shall be a date no more than three business days
prior to such Date of Delivery.
(5) A letter from Deloitte & Touche LLP, in form and substance
reasonably satisfactory to Xxxxxxx Xxxxx and dated such Date of Delivery,
substantially in the same form and substance as a letter furnished to Xxxxxxx
Xxxxx pursuant to Section 5(j) hereof, except that the "specified date" on the
letter furnished pursuant to this paragraph shall be a date no more than three
business days prior to such Date of Delivery.
(o) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the Underwriters shall have been furnished with such
documents and opinions as they reasonably may require for the purpose of
enabling them to pass upon the issuance and sale of the Underwritten Securities
as herein contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company in connection with
the issuance and sale of the Underwritten Securities as herein contemplated
shall be reasonably satisfactory in form and substance to Xxxxxxx Xxxxx and
counsel for the Underwriters.
(p) Termination of Terms Agreement. If any condition specified in
this Section 5 shall not have been fulfilled when as required to be fulfilled,
the applicable Terms Agreement (or, with respect to the Underwriters' exercise
of any applicable over-allotment option for the purchase of Option Underwritten
Securities on a Date of Delivery after the Closing Time, the obligations of the
Underwriters to purchase the Option Underwritten Securities on such Date of
Delivery) may be terminated by Xxxxxxx Xxxxx by notice to the Company at any
time or prior to the Closing Time (or such Date of Delivery, as applicable), and
such termination shall be without liability of any party to any other party
except as provided in Section 4 and except Sections 6 and 7 shall survive any
such termination and remain in full force and effect.
SECTION 6. Indemnification.
---------------
(a) Indemnification by the Company. The Company agrees to indemnify
and hold harmless each Underwriter and each person, if any who controls any
Underwriter within the meaning of
- 31 -
Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(1) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and the Rule 434
Information deemed to be a part thereof, if applicable, or the omission or
alleged omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of any
untrue statement or alleged untrue statement of a material fact included in any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(2) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of (A) the violation of any applicable laws
or regulations of foreign jurisdictions where Reserved Securities have been
offered and (B) any untrue statement or alleged untrue statement of a material
fact included in the Prospectus or preliminary prospectus distributed in
connection with the reservation and sale of the Reserved Securities to certain
directors, officers, employees and other persons associated with the Company of
the Hearst Corporation or the omission or alleged omission therefrom of a
material fact necessary to make the statements therein, when considered in
conjunction with the Prospectus or preliminary prospectus, not misleading;
(3) against any and all loss liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim whatsoever
for which indemnification is provided under Sections 6(a)(1) or 6(a)(2) hereof;
provided that (subject to Section 6(d) below) any such settlement is effected
with the written consent of the Company; and
(4) against any and all expenses whatsoever, as incurred (including
the fees and disbursements of counsel chosen by Xxxxxxx Xxxxx), reasonably
incurred in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever for which indemnification is provided under
Section 6(a)(1), 6(a)(2) or 6(a)(3) hereof to the extent that any such expense
is not paid under (1), (2) or (3) above;
- 32 -
provided, however, that this indemnity agreement shall not apply to any loss,
-------- -------
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through Xxxxxxx Xxxxx expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information deemed to be a part thereof, if applicable, or any
preliminary prospectus or the Prospectus (or an amendment or supplement
thereto), it being understood and agreed that the only such information
furnished by any Underwriter consists of the information described in the
applicable Terms Agreement; provided, further, that the Company will not be
-------- -------
liable to the Underwriters or any person controlling such Underwriters with
respect to any such untrue statement or alleged untrue statement or omission or
alleged omission made in any preliminary prospectus to the extent that the
Company shall sustain the burden of proving that any such loss, liability,
claim, damage or expense resulted from the fact that the Underwriter sold
securities to a person to whom such Underwriter failed to send or give, at or
prior to the written confirmation of the sale of such Securities, a copy of the
Prospectus (as amended or supplemented) if the Company has previously furnished
copies thereof to the Underwriters (as and to the extent required by law in
order to allow for distribution of the Prospectus in a timely manner) and
complied with their obligations under Sections 3(b) and 3(c) hereof, and the
loss, liability, claim, damage or expense of the Underwriters resulted from an
untrue statement or omission or alleged untrue statement or omission of a
material fact contained in or omitted from such preliminary prospectus (as
amended or supplemented) which was corrected in the Prospectus (as amended or
supplemented.
(b) Indemnification of Company, Directors and Officers. Each
Underwriter severally and not jointly agrees to indemnify and hold harmless the
Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information deemed to be part thereof, if
applicable, or any preliminary prospectus or the Prospectus (or any amendment
- 33 -
or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through Xxxxxxx Xxxxx
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto), it being understood and agreed that the only such information
furnished by any Underwriter consists of the information described as such in
the applicable Terms Agreement.
(c) Actions against Parties; Notification. Each indemnified party
shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof and in any event shall not relieve
it from any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section
6(a) above, counsel to the indemnified parties shall be selected by Xxxxxxx
Xxxxx, in the case of parties indemnified pursuant to Section 6(b) above,
counsel to the indemnified parties shall be selected by the Company. An
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. If it so elects within a reasonable time after receipt of
such notice, an indemnifying party, jointly with any other indemnifying parties
receiving such notice, may assume the defense of such action with counsel chosen
by it and reasonably approved by the indemnified parties defendant in such
action, unless such indemnified parties reasonably object to such assumption on
the ground that there may be legal defenses available to them which are
different from or in addition to those available to such indemnifying party. If
an indemnifying party assumes the defense of such action, the indemnifying
parties shall not be liable for any fees and expenses of counsel for the
indemnified parties incurred thereafter in connection with such action. In no
event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
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 general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investment, proceeding or claim.
- 34 -
(d) Settlement without Consent if Failure to Reimburse. If at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 6(a)(3) effected without its written consent if
(i) such settlement is entered into more than 120 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 90 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
(e) Indemnification for Reserved Securities. In connection with the
offer and sale of the Reserved Securities, the Company agrees, promptly upon a
request in writing, to indemnify and hold harmless the Underwriters from and
against any and all losses, liabilities, claims, damages and expenses incurred
by them as a result of the failure of certain directors, officers, employees and
other persons associated with the Company of the Hearst Corporation to pay for
and accept delivery of Reserved Securities which, by the end of the first
business day following the date of this Agreement, were subject to a properly
confirmed agreement to purchase.
SECTION 7. Contribution. If the indemnification provided for in
------------
Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the Underwriters, on the other hand, from the
offering of the Underwritten Securities pursuant to the applicable Terms
Agreement or (ii) if the allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company, on the one hand, and of the Underwriters, on the other hand, in
connection with the statements or omissions, or any violation of the nature
referred to in Section 6(a)(1) hereof, which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the
- 35 -
offering of such Underwritten Securities (before deducting expenses) received by
the Company and the total underwriting discount received by the Underwriters, in
each case as set forth on the cover of the Prospectus, or, if Rule 434 is used,
the corresponding location on the Term Sheet bear to the aggregate initial
public offering price of such Underwritten Securities as set forth on such cover
or Term Sheet.
The relative fault of the Company, on the one hand, and the Underwriters,
on the other hand, shall be determined by reference, to among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company, or by the Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission, or any violation of the nature referred to in
Section 6(a)(1) hereof.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provision of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Underwritten Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of any such untrue
or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the
- 36 -
Company, each officer of the Company who signed the Registration Statement, and
each person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company. The Underwriters' respective obligations to
contribute pursuant to this Section are several in proportion to the number of
Initial Underwritten Securities set forth opposite their respective names in the
applicable Terms Agreement, and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
-----------------------------------------------------
Delivery. All representations, warranties and agreements contained in this
--------
Underwriting Agreement or the applicable Terms Agreement or in certificates of
officers of the Company submitted pursuant hereto or thereto shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any Underwriter or controlling person, or by or on behalf of the
Company, and shall survive delivery of and payment for the Underwritten
Securities.
SECTION 9. Termination.
-----------
(a) Underwriting Agreement. This Underwriting Agreement (excluding
the applicable Terms Agreement) may be terminated for any reason at any time by
the Company or by Xxxxxxx Xxxxx upon the giving of 30 days' prior written notice
of such termination to the other party hereto.
(b) Terms Agreement. Xxxxxxx Xxxxx may terminate the applicable Terms
Agreement, by notice to the Company, at any time at or prior to the Closing Time
or any relevant Date of Delivery, if, since the time of execution of such Terms
Agreement or since the respective dates as of which information is given in the
Prospectus, there shall have occurred (i) any change, or any development or
event involving a prospective change, in the condition (financial or other), or
the earnings, business affairs, business prospects, properties or results of
operations of the Company or its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business which, in the judgment
of a majority in interest of the Underwriters including Xxxxxxx Xxxxx, is
material and adverse and makes it impractical or inadvisable to proceed with
completion of the public offering or the sale of and payment for the
Underwritten Securities; (ii) any suspension or limitation of trading in
securities generally on the Nasdaq, or any setting of minimum prices for trading
on Nasdaq, or any suspension of trading of any securities of the Company on
Nasdaq or in the over-the-counter market; (iii) any banking moratorium declared
by U.S. Federal or New York authorities; or (iv) any outbreak or escalation of
major hostilities in which the United States is involved, any declaration of war
by Congress or any other substantial national or international calamity or
emergency if, in the judgment of a
- 37 -
majority in interest of the Underwriters including Xxxxxxx Xxxxx, the effect of
any such outbreak, escalation, declaration, calamity or emergency on the
financial markets of the United States makes it impractical or inadvisable to
proceed with completion of the public offering or the sale of and payment for
the Underwritten Securities.
(c) Liabilities. If this Underwriting Agreement or the applicable
Terms Agreement is terminated pursuant to this Section 9, such termination shall
be without liability of any party to any other party except as provided in
Section 4 hereof, and provided further that Sections 6 and 7 shall survive such
termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more
------------------------------------------
of the Underwriters shall fail at the Closing Time or the relevant Date of
Delivery, as the case may be, to purchase the Underwritten Securities which it
or they are obligated to purchase under the applicable Terms Agreement (the
"Defaulted Securities"), then Xxxxxxx Xxxxx shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other Underwriter, to purchase all, but not less than all,
of the Defaulting Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, Xxxxxxx Xxxxx shall not have completed such
arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of Underwritten Securities to be purchased on such date pursuant to such
Terms Agreement, the non-defaulting Underwriters shall be obligated, severally
and not jointly, to purchase the full amount thereof in the proportions that
their respective underwriting obligations under such Terms Agreement bear to the
underwriting obligations of all non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number of
Underwritten Securities to be purchased on such date pursuant to such Terms
Agreement, such Terms Agreement (or, with respect to the Underwriters' exercise
of any applicable over-allotment option for the purchase of Option Underwritten
Securities on a Date of Delivery after the Closing Time, the obligations of the
Underwriters to purchase, and the Company to sell, such Option Underwritten
Securities on such Date of Delivery) shall terminate without liability on the
part of any non-defaulting Underwriter.
No action taken pursuant to this Section 10 shall relieve any defaulting
Underwriter from liability in respect of its default.
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In the event of any such default which does not result in (i) a termination
of the applicable Terms Agreement or (ii) in the case of a Date of Delivery
after the Closing Time, a termination of the obligations of the Underwriters and
the Company with respect to the related Option Underwritten Securities, as the
case may be, either Xxxxxxx Xxxxx or the Company shall have the right to
postpone the Closing Time or the relevant Date of Delivery, as the case may be,
for a period not exceeding seven days in order to effect any required changes in
the Registration Statement or the Prospectus or in any other documents or
arrangements.
SECTION 11. Notices. All notices and other communications hereunder
-------
shall be given in writing as directed in the applicable Terms Agreement and
shall be deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication.
SECTION 12. Parties. This Underwriting Agreement and the applicable
-------
Terms Agreement shall each inure to the benefit of and be binding upon the
Company, Xxxxxxx Xxxxx and, upon execution of such Terms Agreement, any other
Underwriters and their respective successors. Nothing expressed or mentioned in
this Underwriting Agreement or such Terms Agreement is intended or shall be
construed to give any person, firm or corporation, other than the Underwriters
and the Company and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Underwriting Agreement or such Terms Agreement or any provision
herein or therein contained. This Underwriting Agreement and such Terms
Agreement and all conditions and provision hereof and thereof are intended to be
for the sole and exclusive benefit of the parties hereto and thereto and their
respective successors, and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Underwritten Securities from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS UNDERWRITING AGREEMENT AND ANY
----------------------
APPLICABLE TERMS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit
or proceeding arising out of or relating to this Underwriting Agreement or any
Terms Agreement or the transactions contemplated thereby.
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SECTION 14. Effect of Headings. The Article and Section headings herein
------------------
are for convenience only and shall not affect the construction hereof.
SECTION 15. Representation of Underwriters. Xxxxxxx Xxxxx will act for
------------------------------
the several Underwriters in connection with the financing described in the Terms
Agreement, and any action under this Underwriting Agreement or such Terms
Agreement taken by Xxxxxxx Xxxxx will be binding upon all the Underwriters.
SECTION 16. Counterparts. The Terms Agreement may be executed 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 Agreement.
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If the foregoing is in accordance with your understanding or our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
Underwriting Agreement, along with all counterparts, will become a binding
agreement between Xxxxxxx Xxxxx and the Company in accordance with its terms.
Very truly yours,
HEARST-ARGYLE TELEVISION, INC.
By: /s/ Xxxx X. Xxxxxx
-----------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Vice President/
Corporate Development,
General Counsel and
Secretary
CONFIRMED AND ACCEPTED,
as of the first
above written:
Xxxxxxx Xxxxx
By: /s/ Xxxxx Xxxxxxxx
---------------------------
Authorized Signatory
