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EXHIBIT 4.7
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SECURITIES PURCHASE AGREEMENT
by and among
TRANSWESTERN PUBLISHING COMPANY LLC,
TWP CAPITAL CORP. II,
TRANSWESTERN HOLDINGS L.P.,
TRANSWESTERN COMMUNICATIONS COMPANY, INC.,
TARGET DIRECTORIES OF MICHIGAN, INC.
and
THE INITIAL PURCHASERS NAMED HEREIN
FIRST UNION CAPITAL MARKETS,
CIBC OPPENHEIMER CORP.,
BANCBOSTON ROBERTSON STEPHENS INC.
Dated as of November 24, 1998
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions......................................................................1
SECTION 1.2. Accounting Terms; Financial Statements...........................................5
ARTICLE II
ISSUE OF NOTES; PURCHASE AND SALE
OF NOTES; RIGHTS OF HOLDERS OF NOTES;
OFFERING BY INITIAL PURCHASERS
SECTION 2.1. Issue of Notes...................................................................5
SECTION 2.2. Purchase, Sale and Delivery of Notes.............................................6
SECTION 2.3. Registration Rights of Holders of Notes..........................................7
SECTION 2.4. Offering by the Initial Purchasers...............................................7
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF NOTES
SECTION 3.1 Representations and Warranties of the Issuers....................................7
SECTION 3.2. Resale of Notes.................................................................22
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
SECTION 4.1. Conditions Precedent to Obligations of the Initial Purchasers...................22
SECTION 4.2. Conditions Precedent to Obligations of the Issuers..............................24
ARTICLE V
COVENANTS
SECTION 5.1. Covenants of the Issuers........................................................25
ARTICLE VI
FEES
SECTION 6.1. Costs, Expenses and Taxes.......................................................27
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ARTICLE VII
INDEMNITY
SECTION 7.1. Indemnity.......................................................................28
SECTION 7.2 Contribution....................................................................31
SECTION 7.3. Registration Rights Agreement...................................................33
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1. Survival of Provisions..........................................................33
SECTION 8.2. Termination.....................................................................33
SECTION 8.3. No Waiver; Modifications in Writing.............................................34
SECTION 8.4. Information Supplied by the Initial Purchasers..................................35
SECTION 8.5. Communications..................................................................35
SECTION 8.6. Execution in Counterparts.......................................................36
SECTION 8.7. Successors......................................................................36
SECTION 8.8. Governing Law...................................................................36
SECTION 8.9. Severability of Provisions......................................................36
SECTION 8.10. Headings........................................................................37
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SECURITIES PURCHASE AGREEMENT, dated as of November 24, 1998
(the "Agreement"), among TRANSWESTERN PUBLISHING COMPANY LLC, a Delaware limited
liability company (the "Company"), TWP CAPITAL CORP. II, a Delaware corporation
("Capital" and together with the Company, the "Issuers"), TRANSWESTERN HOLDINGS
L.P., a Delaware limited partnership ("Holdings"), TRANSWESTERN COMMUNICATIONS
COMPANY, INC., a Delaware corporation and the manager of the Company and the
general partner of Holdings ("Communications"), TARGET DIRECTORIES OF MICHIGAN,
INC., a Michigan corporation and a wholly-owned subsidiary of the Company (the
"Guarantor")and FIRST UNION CAPITAL MARKETS ("First Union"), CIBC OPPENHEIMER
CORP. ("CIBC") and BancBoston Robertson Stephens Inc. ("BancBoston") (the
"Initial Purchasers").
In consideration of the mutual covenants and agreements set
forth herein and for good and valuable consideration, the receipt of which is
hereby acknowledged, the parties agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. As used in this Agreement, and
unless the context requires a different meaning the following terms have the
meanings indicated:
"Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission thereunder.
"Affiliate" of any specified Person means any other Person
which directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control such specified Person. For purposes of
this definition, "control" (including with correlative meanings, the terms
"controlling", "controlled by" and "under common control with"), as used with
respect to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of such
Person, whether through the ownership of voting securities, by agreement or
otherwise.
"Agreement" means this Agreement, as the same may be amended,
supplemented or modified in accordance with the terms hereof and in effect.
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"Basic Documents" means, collectively, the Indenture, the
Notes, the Guarantee, the Registration Rights Agreement and this Agreement.
"Capital Stock" means, with respect to any Person, any and all
shares or other equivalents (however designated) of capital stock, partnership
interests or any other participation, right or other interest in the nature of
an equity interest in such Person or any option, warrant or other security
convertible into or exercisable for any of the foregoing.
"Closing" has the meaning provided therefor in Section 2.2 of
this Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission or
any similar agency then having jurisdiction to en force the Act.
"Commonly Controlled Entity" has the meaning provided therefor
in Section 3.1(z) of this Agreement.
"Default" means any event, act or condition which, with notice
or lapse of time or both, would constitute an Event of Default.
"Employee Benefit Plan" has the meaning provided therefor in
Section 3.1(z) of this Agreement.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, together with all rules and regulations
promulgated pursuant thereto, as amended from time to time.
"Event of Default" means any event defined as an Event of
Default in the Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.
"Exchange Act Reports" has the meaning provided therefor in
Section 2.1 of this Agreement.
"Exchange Notes" shall have the meaning provided therefor in
the Registration Rights Agreement.
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"Facilities" means any and all real property (including
without limitation, all buildings, fixtures or other improvements located
thereon) now, hereafter or heretofore owned, leased, operated or used by the
Issuers, Holdings and Communications or any of their respective predecessors in
interest.
"Guarantee" has the meaning provided therefor in Section 2.1
of this Agreement.
"Guarantor" has the meaning set forth in the introductory
paragraph to this Agreement.
"Indemnified Party" has the meaning provided therefor in
Section 7.1(c) of this Agreement.
"Indemnifying Party" has the meaning provided therefor in
Section 7.1(c) of this Agreement.
"Indenture" means the indenture dated as of December 2, 1998
among the Issuers, the Guarantor and Wilmington Trust Company, as Trustee, under
which the Notes will be issued.
"Initial Purchasers" has the meaning set forth in the
introductory paragraph to this Agreement.
"Intellectual Property Rights" has the meaning provided
therefor in Section 3.1(r) of this Agreement.
"Lien" means, with respect to any property or assets of any
Person, any mortgage or deed of trust, pledge, hypothecation, assignment,
deposit arrangement (other than advance payments or customer deposits for goods
and services sold by Holdings or the Company in the ordinary course of
business), security interest, lien, charge, easement, encumbrance, preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such property or assets (including
without limitation, any Capitalized Lease Obligations (as defined in the
Indenture)), conditional sales, or other title retention agreement having
substantially the same economic effect as any of the foregoing.
"Material Adverse Effect" means (i) a material adverse effect
on the business, assets, condition (financial or otherwise), results of
operations or properties of the Issuers and Communications, taken as a whole, or
(ii) a material ad-
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verse effect on the legality, validity, binding effect or enforceability of this
Agreement or the Basic Documents.
"Memorandum" has the meaning provided therefor in Section 2.1
of this Agreement.
"Notes" means the 9 5/8% Senior Subordinated Notes due 2007,
Series C of the Issuers.
"Offering" means the offering of the Notes pursuant to the
Memorandum.
"Offering Materials" has the meaning provided therefor in
Section 7.1 of this Agreement.
"Offering Memorandum" has the meaning provided therefor in
Section 2.1 of this Agreement.
"Partnership Interest" means any general or limited
partnership interest and any interest as a member of a limited liability company
or a limited liability partnership.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, joint-stock company, trust,
unincorporated organization or association or government (including any agency
or political subdivision thereof).
"PORTAL" means the Private Offering Resales, and Trading
through Automated Linkages Market.
"Private Exchange Notes" has the meaning provided therefor in
the Registration Rights Agreement.
"Proceeding" has the meaning provided therefor in Section
7.1(c) of this Agreement.
"QIB" has the meaning provided therefor in Section 3.2 of this
Agreement.
"Registration Rights Agreement" means the registration rights
agreement among the Issuers, the Guarantor and the Initial Purchasers relating
to the Notes.
"Regulation S" means Regulation S under the Act.
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"State" means each of the states of the United States, the
District of Columbia and the Commonwealth of Puerto Rico.
"State Commission" means any agency of any State having
jurisdiction to enforce such States securities laws.
"tax" has the meaning provided therefor in Section 3.1(x) of
this Agreement.
"Taxpayers" has the meaning provided therefor in Section
3.1(x) of this Agreement.
"Third Amended Partnership Agreement" has the meaning provided
therefor in Section 3.1(c) of this Agreement.
"Time of Purchase" has the meaning provided therefor in
Section 2.2 of this Agreement.
"TransWestern Delivered Documents" has the meaning provided
therefor in Section 3.1(e) of this Agreement.
"Trust Indenture Act" means the Trust indenture Act of 1939,
as amended, and the rules and regulations of the Commission thereunder.
SECTION 1.2. Accounting Terms; Financial Statements. All
accounting terms used herein not expressly defined in this Agreement shall have
the respective meanings given to them in accordance with sound accounting
practice. The term "sound accounting practice" shall mean such accounting
practice as, in the opinion of the independent accountants regularly retained by
the Company, conforms at the time to generally accepted accounting principles in
the United States applied on a consistent basis except for changes with which
such accountants concur. All determinations to which accounting principles apply
shall be made in accordance with sound accounting practice.
ARTICLE II
ISSUE OF NOTES; PURCHASE AND SALE
OF NOTES; RIGHTS OF HOLDERS OF NOTES;
OFFERING BY INITIAL PURCHASERS
SECTION 2.1. Issue of Notes. The Company and Capital have
authorized the issuance of $40,000,000 aggregate prin-
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cipal amount of the Notes which are to be issued pursuant to the Indenture. Each
Note will be substantially in the form of the Note set forth as Exhibit A to the
Indenture.
The obligations of the Company under the Indenture and the
Notes will be unconditionally guaranteed (the "Guarantee"), on a senior
subordinated basis, by the Guarantor. The Guarantee will be substantially in the
form of the Guarantee as set forth in the Indenture.
The Notes will be offered and sold to the Initial Purchasers
without being registered under the Act, in reliance on exemptions therefrom.
In connection with the sale of the Notes, the Issuers have
prepared an offering memorandum dated November 24, 1998 (the "Offering
Memorandum"), which includes as exhibits thereto the Company's Annual Report on
Form 10-K for the fiscal year ended April 30, 1998, Quarterly Report on Form
10-Q filed on November 16, 1998 for the fiscal period ended September 30, 1998,
Current Report on Form 8-K dated May 1, 1998 and Current Report on Form 8-K
dated November 24, 1998 (collectively, the "Exchange Act Reports," and together
with the Offering Memorandum, the "Memorandum"), setting forth or including a
description of the terms of the Notes, the terms of the Offering a description
of the Issuers and any material developments relating to the Issuers occurring
after the date of the most recent financial statements included therein.
SECTION 2.2. Purchase, Sale and Delivery of Notes. On the
basis of the representations, warranties, agreements and covenants herein
contained and subject to the terms and conditions herein set forth, the Issuers
agree that they will sell to each Initial Purchaser, and each Initial Purchaser
agrees, acting severally and not jointly, that it will purchase from the Issuers
at the Time of Purchase, the principal amount of the Notes set forth opposite
the name of such Initial Purchaser on Schedule I hereto at a price equal to
102.5% of the principal amount thereof.
The purchase, sale and delivery of the Notes will take place
at a closing (the "Closing") at the offices of Cahill Gordon & Reindel, 80 Pine
Street, New York, New York 10005, at 9:00 A.M., New York time, on December 2,
1998, or such later date and time, if any, as the Initial Purchasers and the
Company shall agree. The time at which such Closing is concluded is herein
called the "Time of Purchase."
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One or more certificates in definitive form for the Notes that
the Initial Purchasers have agreed to purchase hereunder, and in such
denomination or denominations and registered in such name or names as the
Initial Purchasers request upon notice to the Company at least 24 hours prior to
the Closing shall be delivered by or on behalf of the Issuers to the Initial
Purchasers, against payment by or on behalf of the Initial Purchasers of the
purchase price therefor by wire transfer of immediately available funds wired in
accordance with the written instructions of the Company. The Issuers will make
such certificate or certificates for the Notes available for checking and
packaging by the Initial Purchasers at the offices of CIBC or First Union, or
such other place as CIBC and First Union may designate, at least 24 hours prior
to the Closing.
SECTION 2.3. Registration Rights of Holders of Notes. The
Initial Purchasers and their direct and indirect transferees of the Notes will
have such rights with respect to the registration thereof under the Act and
qualification of the Indenture under the Trust Indenture Act as are set forth in
the Registration Rights Agreement.
SECTION 2.4 Offering by the Initial Purchasers. The Initial
Purchasers propose to make an offering of the Notes at the price and upon the
terms set forth in the Memorandum, as soon as practicable after this Agreement
is entered into and as in the judgment of the Initial Purchasers is advisable.
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF NOTES
SECTION 3.1 Representations and Warranties of the Issuers. The
Company, Capital, Communications and the Guarantor jointly and severally
represent and warrant to and agree with each of the Initial Purchasers as
follows:
(a) Memorandum. The Memorandum, as of its date does not, and
at the Time of Purchase will not, contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading except that the representations and
warranties set forth in this Section 3.1(a) do not apply to statements
or omissions made in reliance upon and in conformity with information
relating to the Initial Purchasers fur-
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nished to the Company in writing by the Initial Purchasers expressly
for use in the Memorandum or any amendment or supplement thereto as set
forth in Section 8.4 hereof. The statistical and market-related data
included in the Memorandum are based on or derived from sources which
the Issuers and Holdings believe to be reliable and accurate or
represents the Issuers' and Holdings good faith estimates that are made
on the basis of data derived from such sources. The Notes, the
Indenture and the Registration Rights Agreement conform in all material
respects to the description thereof in the Memorandum.
(b) Financial Statements. The audited financial statements of
the Company set forth in the Memorandum are in accordance with the
books and records of the Company, fairly present in all material
respects the financial position, results of operations, member deficit
and cash flows of the Company at the dates and for the periods to which
they relate and have been prepared in accordance with generally
accepted accounting principles consistently applied (except as
otherwise stated therein); the unaudited financial statements of the
Company set forth in the Memorandum were prepared in a manner
consistent with the Company's historical practices and in the
reasonable judgment of management fairly present in all material
respects the financial position and results of operations of the
Company at the date and for the period to which they relate, subject
only to year end adjustments, the absence of footnote disclosures and
adjustment required by generally accepted accounting principles; the
summary financial data in the Memorandum present fairly the financial
information shown therein and have been prepared and compiled on a
basis consistent with audited and unaudited financial statements
included therein, except as otherwise stated therein; and the adjusted
and pro forma financial information included in the Memorandum have
been prepared using reasonable assumptions and have been prepared in
accordance with the applicable requirements of the Act, and the
adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein. Ernst & Young LLP,
which has reported upon the audited financial statements included in
the Memorandum, is an independent public accounting firm as required by
the Act and the rules and regulations thereunder.
(c) Organization. The Company is a limited liability company
duly organized, validly existing and in good standing under the laws of
the State of Delaware and has
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the power and authority to carry on its business as now being conducted
and to own and operate the properties and assets now owned and being
operated by it. The Company has delivered to the Initial Purchasers
complete and correct copies of its Certificate of Formation and Limited
Liability Company Agreement (the "LLC Agreement") as in effect on the
date hereof.
Holdings is a limited partnership duly organized, validly
existing and in good standing under the laws of the State of Delaware
and has the power and authority to carry on its business as now being
conducted and to own and operate the properties and assets now owned
and being operated by it. Holdings has delivered to the Initial
Purchasers complete and correct copies of its Certificate of Limited
Partnership and the Third Amended and Restated Agreement of Limited
Partnership, as amended as of November 4, 1997 (the "Third Amended
Partnership Agreement") as in effect on the date hereof. Holdings is
duly qualified or licensed to do business and is in good standing in
each jurisdiction in which such qualification is necessary under the
applicable law as a result of the conduct of its business or the
ownership of its properties except where the failure to be so
qualified, licensed or in good standing does not have a Material
Adverse Effect.
The Guarantor is a corporation duly organized, validly
existing and in good standing under the laws of the State of Michigan
and has the corporate power and authority to carry on its business as
now being conducted and to own and operate the properties and assets
now owned and being operated by it. The Guarantor has delivered to the
Initial Purchasers complete and correct copies of its Certificate of
Incorporation and By-Laws as in effect on the date hereof. The
Guarantor is duly qualified or licensed to do business and is in good
standing in each jurisdiction in which such qualification is necessary
under the applicable law except where the failure to be so qualified,
licensed or in good standing does not have a Material Adverse Effect.
(d) Capitalization; Equity Ownership. As of the Time of
Purchase (after giving effect to the Offering), the Company will have
the capitalization as set forth in the Memorandum, except as otherwise
noted therein, the authorized capital stock of Capital will consist of
1,000 shares of its common stock (all of which will be issued and
outstanding and owned and held by the Company), Hold-
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ings will have the capitalization as set forth in the Memorandum and
the authorized capital stock of Communications will consist of 30,000
shares of its common stock (9,800.05 of which will be issued and
outstanding); except as described in the Memorandum, all of the issued
and outstanding securities of the Company, Holdings and Communications
have been duly authorized and validly issued and are fully paid and
non-assessable and none of them have been issued in violation of any
preemptive or other right; all of the outstanding shares of the
Guarantor are owned by the Company; and, except as contemplated in this
Agreement or the other agreements, instruments or documents delivered
in connection with the transactions contemplated hereby, neither the
Company, Holdings, Capital, Communications nor the Guarantor is a party
to or bound by any contract, agreement or arrangement to issue, sell or
otherwise dispose of or redeem, purchase or otherwise acquire any
Capital Stock, Partnership Interest or any other security of the
Company, Holdings, Capital, Communications or the Guarantor or any
other security exercisable or exchangeable for or convertible into any
Capital Stock, Partnership Interest or any other security of the
Company, Holdings, Capital, Communications or the Guarantor.
(e) Authority. The Company, Holdings, Capital, Communications
and the Guarantor have the power to enter into the Basic Documents (to
the extent a party thereto) and all other agreements, instruments and
documents executed and delivered by the Company, Holdings, Capital,
Communications or the Guarantor pursuant thereto (collectively, the
"TransWestern Delivered Documents") and to carry out their respective
obligations thereunder, including without limitation issuing the Notes
in the manner and for the purpose contemplated by this Agreement. The
execution, delivery and performance of the TransWestern Delivered
Documents and the consummation of the transactions contemplated thereby
have been duly authorized by the Company, Holdings, Capital,
Communications and the Guarantor (to the extent a party thereto), and
no other proceeding or approval on the part of the Company, Holdings,
Capital, Communications and the Guarantor is necessary to authorize the
execution and delivery of the TransWestern Delivered Documents or the
performance of any of the transactions contemplated thereby.
(f) Purchase Agreement. This Agreement has been duly
authorized, executed and delivered by the Issuers, Holdings,
Communications and the Guarantor and (assuming
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the due authorization, execution and delivery thereof by the Initial
Purchasers), is a valid and legally binding agreement of the Issuers,
Holdings, Communications and the Guarantor, enforceable against each of
them in accordance with its terms except (i) that the enforcement
hereof may be subject to bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws now or
hereafter in effect relating to creditors, rights generally, and to
general principles of equity and the discretion of the court before
which any proceeding therefor may be brought and (ii) as any rights to
indemnity or contribution hereunder may be limited by federal and state
securities laws and public policy considerations.
(g) Indenture. The Indenture has been duly authorized by the
Issuers and the Guarantor and, when executed and delivered by the
Issuers and the Guarantor (assuming the due authorization, execution
and delivery thereof by the Trustee), will constitute a valid and
legally binding agreement of the Issuers and the Guarantor, enforceable
against each of them in accordance with its terms except that the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally and
(ii) general principles of equity and the discretion of the court
before which any proceeding therefor may be brought.
(h) Registration Rights Agreement. The Registration Rights
Agreement has been duly authorized by the Issuers and the Guarantor
and, when executed and delivered by the Issuers and the Guarantor
(assuming the due authorization, execution and delivery thereof by the
Initial Purchasers), will constitute a valid and legally binding
agreement of the Issuers and the Guarantor, enforceable against each of
them in accordance with its terms except (i) that the enforcement
thereof may be subject to bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally, and to
general principles of equity and the discretion of the court before
which any proceeding therefor may be brought and (ii) as any rights to
indemnity or contribution thereunder may be limited by federal and
state securities laws and public policy considerations.
(i) Notes. The Notes, the Exchange Notes and the Private
Exchange Notes have each been duly authorized by
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the Issuers and, when executed by the Issuers and authenticated by the
Trustee in accordance with the provisions of the Indenture and, in the
case of the Notes, delivered to and paid for by the Initial Purchasers
in accordance with the terms of this Agreement, will be entitled to the
benefits of the Indenture and will constitute valid and legally binding
obligations of the Issuers enforceable in accordance with their terms,
except that the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally, and (ii) general principles of equity and the discretion of
the court before which any proceeding therefor may be brought.
(j) Guarantee. The Guarantee has been duly authorized by the
Guarantor and, when executed by the Guarantor in accordance with the
provisions of the Indenture and, when the Notes are executed by the
Company and authenticated by the Trustee in accordance with the
provisions of the Indenture and delivered to and paid for by the
Initial Purchaser in accordance with the terms of this Agreement, will
constitute a valid and legally binding obligations of the Guarantor
enforceable against the Guarantor in accordance with its terms except
that the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity and the discretion of
the court before which any proceeding therefor may be brought.
(k) Other Documents. Each other TransWestern Delivered
Document executed and delivered by the Issuers, Holdings,
Communications or the Guarantor (to the extent a party thereto) has
been duly and validly authorized, executed and delivered by the
Issuers, Holdings, Communications and the Guarantor (to the extent
party thereto) and constitutes or will constitute a valid and legally
binding obligation of the Issuers, Holdings, Communications and the
Guarantor (to the extent a party thereto), enforceable against them in
accordance with its terms, except (i) that the enforcement thereof may
be subject to bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and to general principles of
equity and the discretion of the court before which any proceeding
therefor may be brought and (ii)
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as any rights to indemnity and contribution hereunder and thereunder
may be limited by applicable law.
(l) Solvency. Immediately after the consummation of the
transactions contemplated by this Agreement (including the use of
proceeds from the sale of Notes at the Time of Purchase), the fair
value and present fair saleable value of the assets of each of the
Company and Holdings (on a consolidated basis) will exceed the sum of
its stated liabilities and identified contingent liabilities; each of
the Company and Holdings (on a consolidated basis) will not be, after
giving effect to the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby
(including the use of proceeds from the sale of Notes at the Time of
Purchase), (i) left with unreasonably small capital with which to carry
on its business as it is proposed to be conducted, (ii) unable to pay
its debts (contingent or otherwise) as they mature or (iii) otherwise
insolvent.
(m) Absence of Certain Changes. Subsequent to the date as of
which information is given in the Memorandum, except as described in
the Memorandum, there has not been (i) any event or condition that has
a Material Adverse Effect, (ii) any transaction entered into by the
Issuers, other than in the ordinary course of business, that has a
Material Adverse Effect, or (iii) any dividend or distribution of any
kind declared, paid or made by the Company on its Membership Interests
other than Permitted Tax Distributions and other distributions
permitted under the Indenture.
(n) No Violation. Neither the execution, delivery or
performance of any of the TransWestern Delivered Documents nor the
consummation of any of the transactions contemplated thereby (i) will
violate or conflict with the Certificate of Formation or LLC Agreement
of the Company or the Certificate of Limited Partnership or the Third
Amended Partnership Agreement of Holdings, (ii) will violate or
conflict with Capital's, Communications' or the Guarantor's Certificate
of Incorporation or By-Laws, (iii) will, as of the Time of Purchase,
result in any breach of or default under any provision of any material
contract or agreement to which the Company, Holdings, Capital,
Communications or the Guarantor is a party or by which the Company,
Holdings, Capital, Communications or the Guarantor is bound or to which
any property or assets of the Company, Holdings, Capital,
Communications or the
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Guarantor is subject, (iv) violates, is prohibited by or requires the
Company, Holdings, Capital, Communications or the Guarantor to obtain
or make any consent, authorization, approval, registration or filing
under any statute, law, ordinance, regulation (including without
limitation Regulation T, U or X of the Board of Governors of the
Federal Reserve System), rule, judgment, decree or order of any court
or governmental agency, board, bureau, body, department or authority,
or of any other person, presently in effect or in effect at the Time of
Purchase, (v) will cause any acceleration of maturity of any note,
instrument or other indebtedness to which the Company, Holdings,
Capital, Communications or the Guarantor is a party or by which the
Company, Holdings, Capital, Communications or the Guarantor is bound or
with respect to which the Company, Holdings, Capital, Communications or
the Guarantor is an obligor or guarantor, or (vi) except as
contemplated by this Agreement and the other Basic Documents, will
result in the creation or imposition of any Lien upon or give to any
other person any interest or right (including any right of termination
or cancellation) in or with respect to the equity or any of the
properties, assets, business agreements or contracts of the Company,
Holdings, Capital, Communications or the Guarantor, other than any
violation, conflict, breach, default, acceleration or Lien which
individually or in the aggregate does not have a Material Adverse
Effect.
(o) Title and Condition of Properties and Assets. As of the
date hereof, the Company, Holdings, Communications and the Guarantor
have good and valid title to all of their respective owned assets and
properties which are material to their business, taken as a whole, and
Capital has no operating assets. As of the Time of Purchase, the
Company, Holdings, Communications and the Guarantor will have good and
valid title to all of their respective assets and properties which are
material to their business, taken as a whole, (except as sold or
otherwise disposed of in the ordinary course of business), subject to
no Liens other than Permitted Liens (as defined in the Indenture).
(p) Leased Property. Each lease of real property or personal
property that is material to the business of the Company, Holdings,
Communications and the Guarantor, taken as a whole, is in full force
and effect and is valid and enforceable in accordance with its terms.
There is not under any such lease any default by the Company, Holdings,
Communications or the Guarantor, or any event that with
18
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notice or lapse of time or both would constitute such a default by the
Company, Holdings, Communications or the Guarantor and with respect to
which the Company, Holdings, Communications or the Guarantor has not
taken adequate steps to prevent such default from occurring except for
any such default as has not had a Material Adverse Effect; all of such
events, if any, and the aforesaid steps taken by the Company, Holdings,
Communications or the Guarantor are set forth in the Memorandum. There
is not under any such lease any default by any other party thereto or
any event that with notice or lapse of time or both would constitute
such a default thereunder by such party, which default has a Material
Adverse Effect. Neither the Company, Holdings, Communications nor the
Guarantor owns any real property.
(q) Litigation. Except as set forth in the Memorandum, there
are no actions, suits, proceedings or investigations, either at law or
in equity, or before any commission or other administrative authority
in any United States jurisdiction, of any kind now pending or, to the
best of the Company's, Holdings', Capital's, Communications' or the
Guarantor's knowledge, threatened involving the Company, Holdings,
Capital, Communications or the Guarantor that (i) seeks to restrain,
enjoin, prevent the consummation of or otherwise challenge the issuance
and sale of the Notes by the Issuers or the issuance of the Guarantee
by the Guarantor or any of the other material transactions contemplated
hereby, (ii) questions the legality or validity of any such
transactions or seeks to recover damages or obtain other relief in
connection with any such transactions or (iii) which has individually
or in the aggregate, a Material Adverse Effect.
(r) Patents, Copyrights and Trademarks. There are no material
copyrights, patents, trade names, trademarks and service marks,
identifying whether registered or at common law, and all applications
therefor that are pending or in the process of preparation
(collectively, the "Intellectual Property Rights"), that are directly
or indirectly owned, licensed, used, required for use or controlled in
whole or in part by the Company, Holdings, Communications or the
Guarantor and no licenses and other agreements allowing the Company,
Holdings, Communications and the Guarantor to use Intellectual Property
Rights of third parties in the United States that are not accurately
described in the Memorandum. Except as otherwise described in the
Memorandum, the Company, Holdings and the
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Guarantor are the sole and exclusive owners of the Intellectual
Property Rights described therein, free and clear of any Lien (other
than Permitted Liens) and such Intellectual Property Rights have not
been and are not being challenged in any way or involved in any pending
or threatened unfair competition proceeding. Except as set forth in the
Memorandum, there has been and is no claim challenging the scope,
validity or enforceability of any of the Intellectual Property Rights.
Neither the Company, Holdings, Communications nor the Guarantor has
infringed, or is infringing or is subject to any unfair competition
claim with respect to any service mark or trade name registration or
application therefor, trademark, trademark registration or application
therefor, copyright, copyright registration or application therefor,
patent, patent registration or application therefor, or any other
proprietary or intellectual property right of any person or entity and
neither the Company, Holdings, Communications nor the Guarantor has
received or has any knowledge, after due inquiry, of any such claim or
other notice of any such violation or infringement.
(s) Compliance with Laws, Etc. The Company, Holdings, Capital,
Communications and the Guarantor are in compliance with, and the
execution and delivery of this Agreement and the other TransWestern
Delivered Documents and the consummation by the Company, Holdings,
Capital, Communications and the Guarantor of the transactions
contemplated hereby and thereby (including without limitation, the
issuance of the Notes in the manner and for the purpose contemplated by
this Agreement) will comply with, all federal, state and local
statutes, laws, ordinances, regulations, rules, permits, judgments,
orders or decrees applicable to the Company, Holdings, Capital,
Communications or the Guarantor and there does not exist any basis for
any claim of default under or violation of any such statute, law,
ordinance, regulation, rule, judgment, order or decree except such
noncompliance, defaults or violations, if any, that in the aggregate do
not have a Material Adverse Effect. Except as set forth in the
Memorandum, the Company, Holdings, Capital, Communications and the
Guarantor are in compliance with (i) all applicable requirements of all
United States, state and local governmental authorities with respect to
environmental protection, including without limitation, regulations
establishing quality criteria and standards for air, water, land and
hazardous materials, (ii) all applicable requirements of the
Occupational Safety and Health Act of 1970 within
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the United States and rules, regulations and orders thereunder and
(iii) all applicable laws and related rules and regulations of all
United States jurisdictions affecting labor union activities, civil
rights or employment, including without limitation, in the United
States, the Civil Rights Act of 1964, the Age Discrimination in
Employment Act of 1967, the Equal Employment Opportunity Act of 1972,
the Employee Retirement Income Security Act of 1974, the Equal Pay Act
and the National Labor Relations Act, in each case, other than any such
noncompliance which in the aggregate has a Material Adverse Effect.
Neither of the Issuers, Holdings, Communications nor the Guarantor is
currently or, after giving effect to the consummation of the
transactions contemplated by this Agreement and the Basic Documents,
will be (i) in violation of its respective organizational documents, or
(ii) in default (nor will an event occur which with notice or passage
of time or both would constitute such a default) under or in violation
of any indenture or loan or credit agreement or any other material
agreement or instrument to which it is a party or by which it or any of
its properties or assets may be bound or affected (except as set forth
in the Memorandum), which default or violation (individually or in the
aggregate) (x) materially and adversely affects the legality, validity
or enforceability of this Agreement or any of the Basic Documents or
(y) has a Material Adverse Effect. As of the Closing neither the
Company, Holdings, Capital, Communications nor the Guarantor is engaged
in any printing or manufacturing activities.
(t) Governmental Authorizations and Regulations. There are no
material licenses, franchises, permits and other governmental
authorizations held by the Company, Holdings, Capital, Communications
or the Guarantor with respect to the conduct of their respective
businesses that are not accurately described in the Memorandum. Except
as set forth in the Memorandum, no authorization, consent, approval,
license, qualification or formal exemption from, nor any filing
declaration or registration with, any court, governmental agency,
securities exchange or any regulatory authority is required in
connection with the execution, delivery or performance by the Issuers,
Holdings, Communications and the Guarantor of this Agreement or any of
the other Basic Documents or any of the transactions contemplated
thereby, except (i) as may be required under state securities or "blue
sky" laws or the laws of any foreign jurisdiction in connection with
the offer and sale of the Notes, or (ii) as does not (individually or
in
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the aggregate) have a Material Adverse Effect. All such authorizations,
consents, approvals, licenses, qualifications, exemptions, filings,
declarations and registrations set forth in the Memorandum (other than
as disclosed therein) which are required to have been obtained by the
date hereof have been obtained or made, as the case may be, and are in
full force and effect and not the subject of any pending or, to the
knowledge of the Company, threatened attack by appeal or direct
proceeding or otherwise.
(u) Labor Matters. No employees of the Company, Holdings,
Capital, Communications or the Guarantor are currently represented by a
labor union or labor organization, no labor union or labor organization
has been certified or recognized as a representative of any such
employees, and neither the Company, Holdings, Capital, Communications
nor the Guarantor has any obligation under any collective bargaining
agreement or other agreement with any labor union or labor organization
that, in any way, affects the Company, Holdings, Capital,
Communications or the Guarantor.
(v) Employees. Except as set forth in the Memorandum, there
has been no resignation or termination of employment of any officer or
key employee of the Company, Holdings, Capital, Communications or the
Guarantor and neither the Company, Holdings, Capital, Communications
nor the Guarantor has any knowledge of any impending or threatened
resignation or termination of employment in any case that would have a
Material Adverse Effect. Except as set forth it the Memorandum, neither
the Company, Holdings, Capital, Communications nor the Guarantor has
entered into any severance or similar arrangement in respect of any
present or former employees required to be disclosed therein.
(w) Brokers. Except as described in the Memorandum, there are
no claims for brokerage commissions, finders' fees or similar
compensation in connection with the transactions contemplated by this
Agreement based on any arrangement or agreement binding upon the
Company, Holdings, Capital, Communications or the Guarantor.
(x) Tax Matters. Holdings and Communications (hereinafter
referred to collectively as the "Taxpayers") have duly filed all tax
reports and returns required to be filed by them, including all
federal, state, local and
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foreign tax returns and reports, and the Taxpayers have paid in full
all taxes required to be paid by such Taxpayers before such payment
became delinquent other than taxes being contested in good faith and
for which adequate reserves have been established in accordance with
GAAP, except where the failure to file such return or pay such tax
does not have a Material Adverse Effect.
(y) Investment Company. Neither of the Issuers, Holdings,
Communications nor the Guarantor is and immediately after the Time of
Purchase none of them will be, "investment companies" or, to the
Company's knowledge, companies "controlled" by an "investment company"
within the meaning of the Investment Company Act of 1940, as amended.
(z) ERISA. The execution and delivery of this Agreement and
the other Basic Documents and the sale of the Notes to the Initial
Purchasers will not involve any non-exempt prohibited transaction
within the meaning of Section 406 of ERISA or Section 4975 of the Code
on the part of the Issuers or the Guarantor. The preceding
representation is made in reliance on and subject to the accuracy of
the Initial Purchasers' representations and warranties in Section 3.2
hereof. No Reportable Event (as defined in Section 4043 of ERISA) has
occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Employee
Benefit Plan, and the Issuers, the Guarantor and Commonly Controlled
Entities have complied in all material respects with the applicable
provisions of ERISA and the Code in connection with the Employee
Benefit Plans. The present value of all accrued benefits under each
Employee Benefit Plan subject to Title IV of ERISA (based on the
current liability, interest rate and other assumptions used in
preparation of the plan's Form 5500 Annual Report) did not, as of the
last annual valuation date prior to the date on which this
representation is made or deemed made, exceed the value of the assets
of such plan allocable to such accrued benefits. Neither of the
Issuers, the Guarantor, nor any Commonly Controlled Entity (as defined
below) has had a complete or partial withdrawal from any Multiemployer
Plan (as defined in Section 4001(a)(3) of ERISA), and neither the
Issuers, the Guarantor, nor any Commonly Controlled Entity would become
subject to any liability under ERISA if the Issuers, the Guarantor or
any such Commonly Controlled Entity were to withdraw completely from
all Multiemployer Plans as of the valuation
23
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date most closely preceding the date on which such representation is
made or deemed made. No such Multiemployer Plan is in reorganization or
insolvent. There are no material liabilities of the Issuers the
Guarantor or any Commonly Controlled Entity for post-retirement
benefits to be provided to their current and former employees under
Plans which are welfare benefit plans (as described in Section 3(l) of
ERISA). With respect to each Employee Benefit Plan, no event has
occurred and there exists no conditions or set of circumstances in
connection with which the Company or any off its subsidiaries may,
directly or indirectly (through a Commonly Controlled Entity or
otherwise) be subject to material liability under the Code, ERISA or
any other applicable law, except for liability for benefit claims and
funding obligations payable in the ordinary course. "Commonly
Controlled Entity" means any person or entity that, together with any
Issuer or the Guarantor, is treated as a single employer under Section
414(b), (c), (m) or (o) of the Code. "Employee Benefit Plan" means an
employee benefit plan, as defined in Section 3(3) of ERISA, which is
maintained or contributed to by an Issuer, or any Commonly Controlled
Entity or to which an Issuer, or any Commonly Controlled Entity may
have liability.
(aa) The Offering. No form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) was
used by the Issuers, the Guarantor or their representatives in
connection with the offer and sale of the Notes. Neither of the
Issuers, the Guarantor nor any Person authorized to act for any of them
has, either directly or indirectly, sold or offered for sale any of the
Notes or any other similar security of the Issuers or the Guarantor to,
or solicited any offers to buy any thereof from, or has otherwise
approached or negotiated in respect thereof with, any Person or Persons
other than with or through the Initial Purchasers; and the Issuers and
the Guarantor agree that neither they nor any Person acting on their
behalf will sell or offer for sale any Notes and the Guarantee to, or
solicit any offers to buy any Notes or Guarantee from, or otherwise
approach or negotiate in respect thereof with, any Person or Persons so
as thereby to bring the issuance or sale of any of the Notes or
Guarantee within the provisions of Section 5 of the Act. Assuming the
accuracy of the Initial Purchasers' representations and warranties set
forth in Section 3.2 hereof, and the due performance by the Initial
Purchasers of the covenants and agreements set forth in Section 3.2
24
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hereof, the offer and sale of the Notes and the Guarantee to the
Initial Purchasers in the manner contemplated by this Agreement and the
Memorandum does not require registration under the Act and the
Indenture does not require qualification under the Trust Indenture Act.
No securities of the Issuers or the Guarantor are of the same class
(within the meaning of Rule 144A under the Act) as the Notes or the
Guarantee and listed on a national securities exchange registered under
Section 6 of the Exchange Act, or quoted in a U.S. automated
interdealer quotation system. Neither of the Issuers nor the Guarantor
has taken, nor will either of them take, directly or indirectly, any
action designed to, or that might be reasonably expected to, cause or
result in stabilization or manipulation of the price of the Notes.
Neither of the Issuers, the Guarantor nor any of their respective
Affiliates or any person acting on its or their behalf (other than the
Initial Purchasers) has engaged in any directed selling efforts (as
that term is defined in Regulation S) with respect to the Notes or the
Guarantee and the Issuers, the Guarantor Company and their respective
Affiliates and any person acting on its or their behalf (other than the
Initial Purchasers) have acted in accordance with the offering
restrictions requirements of Regulation S.
(bb) Insurance. Holdings, the Company and/or the Guarantor
carry insurance (including self insurance) in such amounts and covering
such risks as in their reasonable determination is adequate for the
conduct of their business and the value of their properties.
(cc) Exchange Act Reports. The Exchange Act Reports, when
filed by the Company with the Commission pursuant to the Exchange Act,
did not include any 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. Such documents, when so filed with the Commission, complied
as to form in all material respects with the requirements of the
Exchange Act and the rules and regulations of the Commission
thereunder.
(dd) Accounting Controls. Each of the Company and the
Guarantor maintains a system of internal accounting controls sufficient
to provide reasonable assurances that (i) transactions are executed in
accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of
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financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (iii) access to
assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
SECTION 3.2. Resale of Notes. Each of the Initial Purchasers
represents and warrants (as to itself only) that it is a "qualified
institutional buyer" as defined in Rule 144A of the Act ("QIB"). Each of the
Initial Purchasers agrees with the Issuers and the Guarantor (as to itself only)
that (a) it has not and will not solicit offers for, or offer or sell, the Notes
or the Guarantee by any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Act) or in any manner involving a
public offering within the meaning of Section 4(2) of the Act; and (b) it has
and will solicit offers for the Notes and the Guarantee only from, and will
offer the Notes only to (A) in the case of offers inside the United States,
Persons whom the Initial Purchasers reasonably believe to be QIBs or, if any
such Person is buying for one or more institutional accounts for which such
Person is acting as fiduciary or agent, only when such Person has represented to
the Initial Purchasers that each such account is a QIB, to whom notice has been
given that such sale or delivery is being made in reliance on Rule 144A, and, in
each case, in transactions under Rule 144A and (B) in the case of offers outside
the United States, to Persons other than U.S. Persons ("foreign purchasers,"
which term shall include dealers or other professional fiduciaries in the United
States acting on a discretionary basis for foreign beneficial owners (other than
an estate or trust)); provided, however, that, in the case of this clause (B),
in purchasing such Notes such Persons are deemed to have represented and agreed
as provided under the caption "Notice to Investors" contained in the Memorandum.
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
SECTION 4.1. Conditions Precedent to Obligations of the
Initial Purchasers. The obligation of each Initial Purchaser to purchase the
Notes to be purchased at the Closing is subject, at the Time of Purchase, to the
satisfaction of the following conditions:
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(a) At the Time of Purchase, the Initial Purchasers shall have
received the opinions, dated as of the Time of Purchase and addressed
to the Initial Purchasers, of Kirkland & Ellis, counsel for the
Issuers, in form and sub stance reasonably satisfactory to counsel for
the Initial Purchasers, to the effect as set forth on Exhibit A hereto.
(b) The Initial Purchasers shall have received an opinion,
addressed to the Initial Purchasers in form and substance satisfactory
to the Initial Purchasers and dated the Time of Purchase, of Cahill
Gordon & Reindel, counsel to the Initial Purchasers.
(c) The Initial Purchasers shall have received from Ernst &
Young LLP a comfort letter or letters dated the Closing in form and
substance reasonably satisfactory to counsel to the Initial Purchasers.
(d) The representations and warranties made by the Issuers,
Holdings and Communications herein shall be true and correct in all
material respects (except for changes expressly provided for in this
Agreement) on and as of the Time of Purchase with the same effect as
though such representations and warranties had been made on and as of
the Time of Purchase, the Issuers shall have complied in all material
respects with all agreements as set forth in or contemplated hereunder
and in the Basic Documents required to be performed by it at or prior
to the Time of Purchase and the Company shall have furnished to each
Initial Purchaser a certificate, dated the Time of Purchase, to such
effect.
(e) Subsequent to the date of the Memorandum, (i) there shall
not have been any change which has a Material Adverse Effect and (ii)
the Issuers and Holdings shall not have taken any voluntary,
affirmative action to conduct their respective businesses other than in
the ordinary course.
(f) At the Time of Purchase and after giving effect to the
consummation of the transactions contemplated by this Agreement and the
Basic Documents, there shall exist no Default or Event of Default.
(g) The purchase of and payment for the Notes by the Initial
Purchasers hereunder shall not be prohibited or enjoined (temporarily
or permanently) by any applicable
27
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law or governmental regulation (including, without limitation,
Regulation T, U or X of the Board of Governors of the Federal Reserve
System).
(h) At the Time of Purchase, the Initial Purchasers shall have
received a certificate, dated the Time of Purchase, from the Company,
Holdings, Capital and Communications stating that the conditions
specified in Sections 4.1(d), (e), (f) and (g) have been satisfied or
duly waived at the Time of Purchase.
(i) Each of the Basic Documents shall have been executed and
delivered by all the respective parties thereto be in full force and
effect.
(j) All proceedings required in order to issue the Notes and
the Guarantee and consummate the transactions contemplated by this
Agreement and all documents and papers relating thereto shall be
reasonably satisfactory to the Initial Purchasers and counsel to the
Initial Purchasers. The Initial Purchasers and counsel to the Initial
Purchasers shall have received copies of such papers and documents of
the Issuers and the Guarantor as they may reasonably request in
connection therewith, all in form and substance reasonably satisfactory
to them.
(k) The sale of the Notes hereunder shall not have been
enjoined (temporarily or permanently) at the Time of Purchase.
On or before the Closing, the Initial Purchasers and counsel
to the Initial Purchasers shall have received such further documents, opinions,
certificates and schedules or other instruments relating to the business,
corporate, legal and financial affairs of the Issuers as they may reasonably
request.
SECTION 4.2. Conditions Precedent to Obligations of the
Issuers. The obligations of the Issuers to deliver the Notes shall be subject to
the accuracy as of the date hereof and at the Time of Purchase (as if made on
and as of the time of Purchase) of the representations and warranties of the
Initial Purchasers herein (delivery of the purchase price by the Initial
Purchasers for the Notes being an affirmation by the Initial Purchasers of the
accuracy of their representations and warranties).
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ARTICLE V
COVENANTS
SECTION 5.1. Covenants of the Issuers. The Issuers and the
Guarantor covenant and agree with each of the Initial Purchasers that:
(a) The Issuers will not amend or supplement the Memorandum or
any amendment or supplement thereto of which the Initial Purchasers
shall not previously have been advised and furnished a copy for a
reasonable period of time prior to the proposed amendment or supplement
and as to which the Initial Purchasers shall not have given their
consent, which consent shall not be unreasonably withheld. The Issuers
will promptly, upon the reasonable request of the Initial Purchasers or
counsel to the Initial Purchasers, make any amendments or supplements
to the Memorandum that may be necessary or advisable in connection with
the resale of the Notes by the Initial Purchasers.
(b) The Issuers and the Guarantor will cooperate with the Initial
Purchasers in arranging for the qualification of the Notes for offering
and sale under the securities or "blue sky" laws of such jurisdictions
as the Initial Purchasers may designate and will continue such
qualifications in effect for as long as may be reasonably necessary to
complete the resale of the Notes; provided, however, that in connection
therewith, neither the Issuers nor the Guarantor shall be required to
qualify as a foreign corporation, to take any acts which would require
it to qualify to do business or to execute a general consent to service
of process in any jurisdiction or subject itself to taxation in excess
of a nominal dollar amount in any such jurisdiction where it is not
then so subject.
(c) If, at any time prior to the completion of the distribution by
the Initial Purchasers of the Notes, the Exchange Notes or the Private
Exchange Notes, any event occurs or information becomes known as a
result of which the Memorandum as then amended or supplemented would
include any untrue statement of a material fact, or omit to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading or it for
any other reason it is necessary at any time to amend or supplement the
Memorandum to comply with applicable law, the Issuers will
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promptly notify the Initial Purchasers thereof (who thereafter will not
use such Memorandum until appropriately amended or supplemented) and
will prepare, at the expense of the Issuers, an amendment or supplement
to the Memorandum that corrects such statement or omission or effects
such compliance.
(d) The Issuers will, without charge, provide to the Initial
Purchasers and to counsel to the Initial Purchasers as many copies of
the Memorandum or any amendment or supplement thereto as the Initial
Purchasers may reasonably request.
(e) The Issuers will apply the net proceeds from the sale of the
Notes as set forth under "Use of Proceeds" in the Memorandum.
(f) For and during the period ending on the date no Notes are
outstanding, the Issuers will furnish to the Initial Purchasers copies
of all reports and other communications (financial or otherwise)
furnished by the Issuers to the Trustee or the holders of the Notes and
promptly after available copies of any reports or financial statements
furnished to or filed by the Issuers with the Commission or any
national securities exchange on which any class of securities of the
Company may be listed.
(g) Prior to the Time of Purchase, the Company will furnish to the
Initial Purchasers, as soon as they have been prepared in final form, a
copy of any unaudited interim financial statements of the Company for
any period subsequent to the period covered by the most recent
financial statements appearing in the Memorandum.
(h) None of the Issuers nor any of their Affiliates will sell,
offer for sale or solicit offers to buy or otherwise negotiate in
respect of any "security" (as defined in the Act) which could be
integrated with the sale of the Notes in a manner which would require
the registration under the Act of the Notes.
(i) The Issuers will not solicit any offer to buy or offer to sell
the Notes by means of any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) or
in any manner involving a public offering within the meaning of Section
4(2) of the Act.
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(j) For so long as any of the Notes remain outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Act and not saleable in full under Rule 144 under the Act (or any
successor provision), the Issuers will make available, upon request, to
any seller of such Notes the information specified in Rule 144A(d)(4)
under the Act, unless the Issuers are then subject to Section 13 or
15(d) of the Exchange Act.
(k) The Issuers will use their best efforts to (i) permit the
Notes to be included for quotation on PORTAL and (ii) permit the Notes
to be eligible for clearance and settlement through The Depository
Trust Company.
(l) The Issuers, Holdings, Communications and the Guarantor (to
the extent a party thereto) will do and perform all things required to
be done and performed by them under this Agreement and the other Basic
Documents prior to or after the Closing, subject to the qualifications
and limitations in the writing that expresses such obligations, and to
satisfy all conditions precedent on their part to the obligations of
the Initial Purchasers under this Agreement to purchase and accept
delivery of the Notes.
(m) In connection with Notes offered and sold in an offshore
transaction (as defined in Regulation S), the Issuers will not register
any transfer of such Notes not made in accordance with the provisions
of Regulation S and will not, except in accordance with the provisions
of Regulation S, if applicable, issue any such Notes in the form of
definitive securities.
ARTICLE VI
FEES
SECTION 6.1. Costs, Expenses and Taxes. The Issuers, jointly
and severally, agree to pay all costs and expenses incident to the performance
of their obligations under this Agreement, whether or not the transactions
contemplated herein are consummated or this Agreement is terminated pursuant to
Section 8.2 hereof, including, but not limited to, all costs and expenses
incident to (i) the Company's cost of preparation, printing, reproduction,
execution and delivery of this Agreement, each of the other Basic Documents, any
amendment or sup-
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plement to or modification of any of the foregoing and any and all other
documents furnished pursuant hereto or thereto or in connection herewith or
therewith, (ii) any costs of printing the Memorandum and any amendment or
supplement thereto, any other marketing related materials, (iii) all
arrangements relating to the delivery to the Initial Purchasers of copies of the
foregoing documents, (iv) the fees and disbursements of the counsel, the
accountants and any other experts or advisors retained by the Issuers, (v)
preparation (including printing), issuance and delivery to the Initial
Purchasers of the Notes, (vi) fees and expenses of the Trustee, including fees
and expenses of counsel to the Trustee, (vii) all expenses and listing fees
incurred in connection with the application for quotation of the Notes on
PORTAL, (viii) any fees charged by investment rating agencies for the rating of
the Notes, and (ix) except as limited by Article VII, all costs and expenses
(including, without limitation, reasonable attorneys' fees and expenses), if
any, of the successful enforcement of this Agreement, the Notes or any other
agreement furnished pursuant hereto or thereto or in connection herewith or
therewith. In addition, the Issuers shall pay any and all stamp, transfer and
other similar taxes payable or determined to be payable in connection with the
execution and delivery of this Agreement, any other Basic Document or the
issuance of the Notes, and shall save and hold each Initial Purchaser harmless
from and against any and all liabilities with respect to or resulting from any
delay in paying, or omission to pay, such taxes. Notwithstanding anything
herein, it is understood that the Issuers shall have no obligation to pay any
fees, expenses or disbursements of Cahill Gordon & Reindel, counsel for the
Initial Purchasers.
ARTICLE VII
INDEMNITY
SECTION 7.1. Indemnity.
(a) Indemnification by the Issuers. The Issuers and
Holdings, jointly and severally, agree and covenant to hold harmless
and indemnify each of the Initial Purchasers and any Affiliates thereof
(including any director, officer, employee, agent or controlling Person
of any of the foregoing) from and against any losses, claims, damages,
liabilities and expenses (including expenses of investigation) to which
such Initial Purchaser and its Affiliates may become subject arising
out of or based upon any untrue
32
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statement or alleged untrue statement of any material fact contained in
the Memorandum and any amendments, or supplements thereto, the Basic
Documents or any application or other documents filed with the
Commission or any State Commission (collectively, the "Offering
Materials") or arising out of or based upon the omission or alleged
omission to state in any of the Offering Materials a material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that the Issuers and
Holdings shall not be liable under this paragraph (a) to the extent
that such losses, claims, damages or liabilities arose out of or are
based upon an untrue statement or omission made in any of the documents
referred to in this paragraph (a) in reliance upon and in conformity
with the information relating to the Initial Purchasers furnished in
writing by such Initial Purchasers for inclusion therein; provided,
further, that the Issuers and Holdings shall not be liable under this
paragraph (a) to the extent that such losses, claims, damages or
liabilities arose out of or are based upon an untrue statement or
omission made in any Memorandum that is corrected in any amendment or
supplement thereto if the person asserting such loss, claim, damage or
liability purchased Notes from an Initial Purchaser in reliance on such
Memorandum but was not given the Memorandum (or any amendment or
supplement thereto) on or prior to the confirmation of the sale of such
Notes. The Issuers and Holdings, on a joint and several basis, further
agree to reimburse each Initial Purchaser for any reasonable legal and
other expenses as they are incurred by it in connection with
investigating, preparing to defend or defending any lawsuits, claims or
other proceedings or investigations arising in any manner out of or in
connection with such Person being an Initial Purchaser; provided that
if the Issuers or Holdings reimburse an Initial Purchaser hereunder for
any expenses incurred in connection with a lawsuit, claim or other
proceeding for which indemnification is sought, such Initial Purchaser
hereby agrees to refund such reimbursement of expenses to the extent
that the losses, claims, damages or liabilities are not entitled to
indemnification hereunder. The Issuers and Holdings further agree that
the indemnification, contribution and reimbursement commitments set
forth in this Article VII shall apply whether or not an Initial
Purchaser is a formal party to any such lawsuits, claims or other
proceedings. The indemnity, contribution and expense reimbursement
obligations of the Issuers and Holdings under this Article
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VII shall be in addition to any liability the Issuers or Holdings may
otherwise have.
(b) Indemnification by the Initial Purchasers. Each of the
Initial Purchasers agrees and covenants, severally and not jointly, to
hold harmless and indemnify the Issuers and Holdings and any Affiliates
thereof (including any director, officer, employee, agent or
controlling Person of any of the foregoing) from and against any
losses, claims, damages, liabilities and expenses insofar as such
losses, claims, damages, liabilities or expenses arise out of or are
based upon any untrue statement of any material fact contained in the
Offering Materials, or upon the omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or omission was made in reliance
upon and in conformity with the information relating to such Initial
Purchaser furnished in writing by such Initial Purchaser for inclusion
therein. The indemnity, contribution and expense reimbursement
obligations of the Initial Purchasers under this Article VII shall be
in addition to any liability the Initial Purchasers may otherwise have.
(c) Procedure. If any Person shall be entitled to indemnity
hereunder (each an "Indemnified Party"), such Indemnified Party shall
give prompt written notice to the party or parties from which such
indemnity is sought (each an "Indemnifying Party") of the commencement
of any action, suit, investigation or proceeding, governmental or
otherwise (a "Proceeding"), with respect to which such Indemnified
Party seeks indemnification or contribution pursuant hereto; provided,
however, that the failure so to notify the Indemnifying Parties shall
not relieve the indemnifying Parties from any obligation or liability
except to the extent that the indemnifying Parties have been prejudiced
materially by such failure. The Indemnifying Parties shall have the
right, exercisable by giving written notice to an Indemnified Party
promptly after the t, of written notice from such Indemnified Party of
such Proceeding, to assume, at the Indemnifying Parties' expense, the
defense of any such Proceeding, with counsel reasonably satisfactory to
such Indemnified Party; provided, however, that an Indemnified Party or
parties (if more than one such Indemnified Party is named in any
Proceeding) shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof,
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but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party or parties unless: (1) the Indemnifying Parties
agree to pay such fees and expenses; or (2) the Indemnifying Parties
fail promptly to assume the defense of such Proceeding or fail to
employ counsel reasonably satisfactory to such Indemnified Party or
parties; or (3) the named parties to any such Proceeding (including any
impleaded parties) include both such Indemnified Party or parties and
the Indemnifying Party or an Affiliate of the Indemnifying Party and
such Indemnified Parties, and the Indemnified Parties shall have been
advised in writing by counsel that there may be one or more legal
defenses available to such Indemnified Party or parties that are
different from or additional to those available to the Indemnifying
Parties, in which case, IF such Indemnified Party or parties notifies
the Indemnifying Parties in writing that it elects to employ separate
counsel at the expense of the Indemnifying Parties, the Indemnifying
Parties shall not have the right to assume the defense thereof and such
counsel shall be at the expense of the Indemnifying Parties, it being
understood, however, that, unless there exists a conflict among
Indemnified Parties, the Indemnifying Parties shall not, in connection
with any one such Proceeding or separate but substantially similar or
related Proceedings in the same jurisdiction, arising out of the same
general allegations or circumstances, be liable for the reasonable fees
and expenses of more than one separate firm of attorneys (together with
appropriate local counsel) at any time for such Indemnified Party or
Parties, or for fees and expenses that are not reasonable. No
Indemnified Party or Parties will settle any Proceeding without the
consent of the Indemnifying Party or Parties (but such consent shall
not be unreasonably withheld). No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement
of any pending or threatened Proceeding in respect of which any
Indemnified Party is or could have been a party and indemnity could
have been sought hereunder by such Indemnified Party, unless such
settlement includes an unconditional release of such Indemnified Party
from all liability or claims that are the subject of such Proceeding.
SECTION 7.2. Contribution. If for any reason the
indemnification provided for in Section 7.1 of this Agreement is unavailable to
an Indemnified Party, or insufficient to hold it harmless, in respect of any
losses, claims, damages, liabilities or expenses referred to therein, then each
applicable
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Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages or liabilities in such proportion as is
appropriate to reflect not only the relative benefits received by the
Indemnifying Party on the one hand and the Indemnified Party on the other, but
also the relative fault of the Indemnifying and Indemnified Parties in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Indemnifying and
Indemnified Parties shall be deemed to be in the same proportion as the total
proceeds from the offering of the Notes (net of the Initial Purchasers'
discounts and commissions but before deducting expenses) received by the Issuers
bear to the total discounts and commissions received by each Initial Purchaser.
The relative fault of the Indemnifying and Indemnified Parties shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Indemnifying or
Indemnified Parties and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages
and liabilities referred to above shall be deemed to include any legal or other
fees or expenses incurred by such party in connection with investigating or
defending any such claim.
The Issuers, Holdings and each of the Initial Purchasers agree
that it would not be just and equitable if contribution pursuant to the
immediately preceding paragraph were determined pro rata or per capita or by any
other method of allocation which does not take into account the equitable
considerations referred to in such paragraph. Notwithstanding any other
provision of this Section 7.2, no Initial Purchaser shall be obligated to make
contributions hereunder that in the aggregate exceed the total discounts,
commissions and other compensation received by such Initial Purchaser under this
Agreement, less the aggregate amount of any damages that such Initial Purchaser
has otherwise been required to pay by reason of the untrue or alleged untrue
statements or the omissions or alleged omissions to state a material fact. No
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation.
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SECTION 7.3. Registration Rights Agreement. Notwithstanding
anything to the contrary in this Article 7, the indemnification and contribution
provisions of the Registration Rights Agreement shall govern any claim with
respect thereto,
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1. Survival of Provisions. The representations,
warranties and covenants of the Issuers, Holdings, Communications, the Guarantor
and the Initial Purchasers made herein, the indemnity and contribution
agreements contained herein and each of the provisions of Articles VI, VII and
VIII shall remain operative and in full force and effect regardless of (a) any
investigation made by or on behalf of the Issuers, any Initial Purchaser or any
Indemnified Party, (b) acceptance of any of the Notes and payment therefor, (c)
any termination of this Agreement other than pursuant to Section 8.2, or (d)
disposition of the Notes by the Initial Purchasers whether by redemption,
exchange, sale or otherwise. With respect to any termination of this Agreement
pursuant to Section 8.2, this Agreement and the obligations contemplated hereby
shall terminate without liability to any party, and no party shall have any
continuing obligation hereunder or liability to any other party hereto, except
that each of the provisions of Articles VI, VII, and VIII shall remain operative
and in full force and effect regardless of any termination pursuant thereto.
SECTION 8.2. Termination. (a) This Agreement may be terminated
in the sole discretion of the Initial Purchasers by notice to the Company given
prior to the Time of Purchase in the event that the Issuers or the Guarantor
shall have failed, refused or been unable to perform all obligations and satisfy
all conditions on their part to he performed or satisfied hereunder at or prior
thereto or, if at or prior to the Closing:
(i) the Issuers, Holdings or the Guarantor shall have
sustained any loss or interference with respect to
their businesses or properties from
fire, flood, hurricane, accident or other calamity,
whether or not covered by insurance, or from any
strike, labor dispute, slow down or work stoppage or
any legal or governmental proceeding, which loss or
interference, in the sole judgment of the Initial
Purchasers, has a Mate-
37
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rial Adverse Effect, or there shall have been, in the
sole judgment of the Initial Purchasers, any event or
development that, individually or in the aggregate,
has a Material Adverse Effect (including without
limitation a Change of Control (as defined in the
Indenture)), except in each case as described in the
Memorandum (exclusive of any amendment or supplement
thereto);
(ii) trading in securities of the Company or in securities
generally and the New York Stock Exchange, American
Stock Exchange or the Nasdaq National Market shall
have been suspended or minimum or maximum prices
shall have been established on any such exchange or
market;
(iii) a banking moratorium shall have been declared by New
York or United States authorities;
(iv) there shall have been (A) an outbreak or escalation
of hostilities between the United States and any
foreign power, or (B) an outbreak or escalation of
any other insurrection or armed conflict involving
the United States or any other national or
international calamity or emergency, or (C) any
material change in the financial markets of the
United States which, in the case of (A), (B) or (C)
above and in the sole judgment of the Initial
Purchasers, makes it impracticable or inadvisable to
proceed with the offering or the delivery of the
Notes as contemplated by the Memorandum; or
(v) any securities of the Company or Holdings shall have
been downgraded or placed on any "watch list" for
possible downgrading by any nationally recognized
statistical rating organization.
(b) Termination of this Agreement pursuant to this Section 8.2
shall be without liability of any party to any other party except as provided in
Section 8.1 hereof.
SECTION 8.3. No Waiver; Modifications in Writing. No failure
or delay on the part of any of the parties hereto in exercising any right, power
or remedy hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or remedy preclude any other or
fur-
38
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ther exercise thereof or the exercise of any other right, power or remedy.
The remedies provided for herein are cumulative and are not exclusive of any
remedies that may be available to the parties at law or in equity or otherwise.
No waiver of or consent to any departure by the Issuers from any provision of
this Agreement shall be effective unless signed in writing by the party hereto
entitled to the benefit thereof, provided that notice of any such waiver shall
be given to each party hereto as set forth below. Except as otherwise provided
herein, no amendment, modification or termination of any provision of this
Agreement shall be effective unless signed in writing by or an behalf of each of
the Issuers and each Initial Purchaser. Any amendment, supplement or
modification of or to any provision of this Agreement, any waiver of any
provision of this Agreement, and any consent to any departure by any party from
the terms of any provision of this Agreement, shall be effective only in the
specific instance and for the specific purpose for which made or given. Except
where notice is specifically required by this Agreement, no notice to or demand
on the Issuers or the Guarantor in any case shall entitle the Issuers or the
Guarantor to any other or further notice or demand in similar or other
circumstances.
SECTION 8.4. Information Supplied by the Initial Purchasers.
The statements set forth in the fourth paragraph on page (i) and in the third
and fourth sentences of the fifth paragraph and the eighth paragraph under the
heading "Plan of Distribution" in the Memorandum (to the extent such statements
relate to the Initial Purchasers) constitute the only information furnished by
the Initial Purchasers to the Company for the purposes of Sections 3.1(a) and
7.1(a) and (b) hereof.
SECTION 8.5. Communications. All notices, demands and other
communications provided for hereunder shall be in writing and, (a) if to the
Initial Purchasers, shall be given by registered or certified mail, return
receipt requested, telex, telegram, telecopy, courier service or personal
delivery, addressed to First Union Capital Markets, 301 South College
Street,TW-10, Charlotte, North Carolina 28288-0604, CIBC Oppenheimer Corp., 425
Lexington Avenue, 3rd floor, New York, New York 10017, and BancBoston Robertson
Stephens Inc., 100 Federal Street, 01-12-07, Boston, Massachusetts 02110, and
with a copy to Cahill Gordon & Reindel, 80 Pine Street, New York, New York,
10005, Attention: Geoffrey E. Liebmann, Esq. and (b) if to the Issuers,
Holdings, Communications or the Guarantor, shall be given by similar means to
TransWestern Publishing Company LLC, 8344 Clairemont Mesa Boulevard, San Diego,
CA 92111, Attn: Chief Financial Officer, with copies to Kirkland
39
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& Ellis, 200 East Randolph Drive, Chicago, IL 60601, Attn: William S. Kirsch,
P.C. In each case notices, demands and other communications shall be deemed
given when received.
SECTION 8.6. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute but one and the same Agreement.
SECTION 8.7. Successors. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and legal representatives, and nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other Person any legal
or equitable right, remedy or claim under or in respect of this Agreement, or
any provisions herein contained; this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and exclusive
benefit of such Persons and for the benefit of no other Person except that (i)
the indemnities of the Issuers contained in Section 7.1(a) of this Agreement
shall also be for the benefit of the directors, officers, employees and agents
of the Initial Purchasers and any Person or Persons who control the Initial
Purchasers within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act and (ii) the indemnities of the Initial Purchasers contained in
Section 7.1(b) of this Agreement shall also be for the benefit of the directors
of the Issuers, their directors, officers, employees and agents and any Person
or Persons who control the Issuers within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act. No purchaser of Notes from the Initial
Purchasers will be deemed a successor because of such purchase.
SECTION 8.8. Governing Law. THIS AGREEMENT SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
SECTION 8.9. Severability of Provisions. Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
40
SECTION 8.10. Headings. The Article and Section headings and
Table of Contents used or contained in this Agreement are for convenience of
reference only and shall not affect the construction of this Agreement.
41
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.
TRANSWESTERN PUBLISHING COMPANY LLC
By: /s/ Joan M. Fiorito
------------------------------------------
Name: Joan M. Fiorito
Title: Vice President, Chief Financial Officer
TWP CAPITAL CORP. II
By: /s/ Joan M. Fiorito
------------------------------------------
Name: Joan M. Fiorito
Title: Vice President, Chief Financial Officer
TRANSWESTERN HOLDINGS L.P.
By: TRANSWESTERN COMMUNICATIONS
COMPANY, INC., its general partner
By: /s/ Joan M. Fiorito
------------------------------------------
Name: Joan M. Fiorito
Title: Vice President, Chief Financial Officer
TRANSWESTERN COMMUNICATIONS COMPANY, INC.
By: /s/ Joan M. Fiorito
------------------------------------------
Name: Joan M. Fiorito
Title: Vice President, Chief Financial Officer
TARGET DIRECTORIES OF MICHIGAN, INC.
By: /s/ Joan M. Fiorito
------------------------------------------
Name: Joan M. Fiorito
Title: Vice President, Chief Financial Officer
42
FIRST UNION CAPITAL MARKETS
By: /s/ Scott E. Chappell
------------------------------------------
Name: Scott E. Chappell
Title: Vice President
CIBC OPPENHEIMER CORP.
By: /s/ Brian S. Gerson
------------------------------------------
Name: Brian S. Gerson
Title: Managing Director
BANCBOSTON ROBERTSON STEPHENS INC.
By: /s/ Scott M. D'Orsi
------------------------------------------
Name: Scott M. D'Orsi
Title: Vice President
43
SCHEDULE I
Principal Amount
Initial Purchaser of Notes
- ----------------- ----------------
First Union Capital Markets $20,000,000
CIBC Oppenheimer Corp. 15,000,000
BancBoston Robertson Stephens Inc. 5,000,000
-----------
Total $40,000,000