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Exhibit 1.1
SPANISH BROADCASTING SYSTEM, INC.
[____%] SENIOR SUBORDINATED NOTES
FORM OF
UNDERWRITING AGREEMENT
October [28], 1999
LEHMAN BROTHERS INC .
CIBC WORLD MARKETS CORP.
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
Dear Sirs:
Spanish Broadcasting System, Inc., a Delaware corporation (the
"Company") proposes to issue and sell to the several underwriters named in
Schedule 1 hereto (the "Underwriters"), an aggregate of $235 million principal
amount of [____%] Senior Subordinated Notes due 2009 (the "Notes") to be issued
under an indenture (the "Indenture") dated October [28], 1999, by and between
the Company and the Bank of New York, as trustee (the "Trustee").
It is understood that the Company is currently entering into an
agreement (the "Equity Underwriting Agreement"), pursuant to which an aggregate
of 22,227,400 shares (the "Firm Stock") of the Company's Class A Common Stock,
par value $.0001 share (the "Class A Common Stock") , will be sold by the
Company and certain selling stockholders of the Company to the several
Underwriters named in Schedule 1 to the Equity Underwriting Agreement (the
"Underwriters").
Section 1. Representations, Warranties and Agreements of the Company. The
Company represents, warrants and agrees that:
(a) A registration statement on Form S-1 with respect to the Notes has (i)
been prepared by the Company in conformity with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"), and the rules and
regulations (the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") thereunder, (ii) been filed with the Commission
under the Securities Act, and (iii) become effective under the Securities Act
(other than any Rule 462 Registration Statement to be filed after the execution
of this Agreement which will become effective no later than the day after the
execution of this Agreement). Copies of such registration statement and each of
the amendments thereto have been delivered by the Company to you. As used in
this Agreement, "Effective Time" means the date and the time as of which such
registration statement, or the most recent post-effective amendment thereto, if
any, was declared effective by the Commission; "Effective Date" means the date
of the Effective Time; "Preliminary Prospectus" means each prospectus, included
in such registration statement, or amendments thereof, before it became
effective under the Securities Act and any prospectus filed with the Commission
by the Company with the consent of the Underwriters pursuant to Rule 424(a) of
the Rules and Regulations; "Registration Statement" means such registration
statement, including all material incorporated by reference therein, as amended
at the Effective Time, including all information contained in the final
prospectus filed with the Commission pursuant to Rule 424(b) of the Rules and
Regulations and deemed to be a part of the registration statement as of the
Effective Time
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pursuant to Rule 430A of the Rules and Regulations; and "Prospectus" means the
prospectus in the form first used to confirm sales of the Notes. If the Company
has filed an abbreviated registration statement to register additional Notes
pursuant to Rule 462(b) under the Securities Act (the "Rule 462 Registration
Statement"), then any reference herein to the term "Registration Statement"
shall be deemed to include such Rule 462 Registration Statement. The Commission
has not issued any order preventing or suspending the use of any Preliminary
Prospectus.
(b) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the Commission, as
the case may be, conform in all respects to the requirements of the Securities
Act and the Rules and Regulations and do not and will not, as of the applicable
effective date (as to the Registration Statement and any amendment thereto) and
as of the applicable filing date (as to the Prospectus and any amendment or
supplement thereto) 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; provided that no representation or warranty
is made as to information contained in or omitted from the Registration
Statement or the Prospectus in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter
specifically for inclusion therein.
(c) The Company and each of its subsidiaries (as defined in Section 14)
have been duly incorporated and are validly existing as corporations in good
standing under the laws of their respective jurisdictions of incorporation, are
duly qualified to do business and are in good standing as foreign corporations
in each jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification, except
where the failure to be so qualified would not have a material adverse effect on
the general affairs, management, consolidated financial position, stockholders'
equity or results of operation of the Company and its subsidiaries taken as
whole (a "Material Adverse Effect"). The Company and each of its subsidiaries
have all power and authority necessary to own or hold their respective
properties and to conduct the businesses in which they are engaged; and none of
the subsidiaries of the Company other than [ ] is a "significant subsidiary,"
as such term is defined in Rule 405 of the Rules and Regulations.
(d) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued, are fully paid and non-assessable
and conform to the description thereof contained in the Prospectus; and all of
the issued shares of capital stock of each subsidiary of the Company have been
duly and validly authorized and issued and are fully paid and non-assessable and
(except for directors' qualifying shares) are owned directly or indirectly by
the Company, free and clear of all liens, encumbrances, equities or claims and
none of such shares of capital stock was issued in violation of preemptive or
other similar rights arising by operation of law, under the charter and by-laws
of the Company or under any agreement to which the Company or any subsidiary is
a party or otherwise.
(e) This Agreement has been duly authorized, executed and delivered by the
Company and each of the other documents relating to this Agreement to which the
Company is a party has been duly authorized, executed and delivered by the
Company.
(f) The Indenture between the Company and the Trustee has been duly
qualified under the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act") and has been duly authorized, executed and delivered by the
Company and is a valid and legally binding agreement of the Company, enforceable
in accordance with its terms except as (i) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditor's rights
generally and (ii) rights of
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acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability.
(g) The Notes have been duly authorized and, when executed, authenticated
and issued in accordance with the provisions of the Indenture and delivered to
and paid for by the purchasers thereof, will be in the form contemplated by and
will be entitled to the benefits of, the Indenture and will be validly issued
and free and clear of all liens and restrictions on transfer and will constitute
valid and legally binding obligations of the Company, enforceable in accordance
with their respective terms except as (i) enforceability thereof may be limited
by bankruptcy, insolvency or similar laws affecting creditors' rights generally
and (ii) rights of acceleration and the availability of equitable remedies may
be limited by equitable principles of general applicability.
(h) The execution, delivery and performance of this Agreement, the
Indenture and the Notes and the consummation of the transactions contemplated
hereby, thereby and in the Registration Statement and the Prospectus (including
the issuance and sale of the Notes and the use of proceeds from the sale of the
Notes as described under the caption "Use of Proceeds") will not conflict with
or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement, license or instrument to which the Company or any
of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, except for such defaults which,
individually or in the aggregate, would not result in a Material Adverse Effect,
nor will such actions result in any violation of the provisions of the charter,
certificate of designation, by-laws or similar governing document of the Company
or any of its subsidiaries or any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the Company or
any of its subsidiaries or any of their properties or assets; and except for the
registration of the Notes under the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under the
Exchange Act of 1934, as amended (the "Exchange Act") and applicable state
securities laws in connection with the purchase and distribution of the Notes by
the Underwriters, no consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or body is required for
the execution, delivery and performance of this Agreement, the Indenture or the
Notes and the consummation of the transactions contemplated hereby or thereby,
including the issuance, sale and delivery of the Notes to be issued, sold and
delivered by the Company hereunder.
(i) Except as described 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 Securities 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 Securities Act.
(j) Except as described in the Prospectus, the Company has not sold or
issued any securities, or securities that are convertible into other securities,
with terms that are substantially similar to the Notes during the six-month
period preceding the date of the Prospectus, including any sales pursuant to
Rule 144A under, or Regulations D or S of, the Securities Act.
(k) The Company has not taken and will not take, directly or indirectly,
any action designed to cause or result in, or which constitutes or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of the Notes to facilitate the sale or resale of the Notes.
(l) Neither the Company nor any of its subsidiaries has sustained, since
the date of the latest audited financial statements included in the Prospectus,
any loss or interference with its business
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from fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order or
decree, otherwise than as set forth or contemplated in the Prospectus that would
result in a Material Adverse Effect; and, since such date, there has not been
any change in the capital stock or long-term debt of the Company or any of its
subsidiaries or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, consolidated financial position, stockholders' equity, results of
operations, business or prospects of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus.
(m) The financial statements (including the related notes and supporting
schedules) filed as part of the Registration Statement or included in the
Prospectus present fairly the financial condition and results of operations of
the entities purported to be shown thereby, at the dates and for the periods
indicated, and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved.
(n) Immediately after the sale of the Notes by the Company hereunder, the
aggregate amount of Notes which shall have been issued and sold by the Company
hereunder and of any debt securities of the Company (other than the Notes) that
shall have been issued and sold pursuant to the Registration Statement will not
exceed the amount of debt securities registered under the Registration
Statement.
(o) No default or event of default with respect to any Indebtedness (as
such term is defined in the Indenture) or will exist as a result of the
execution and delivery of this Agreement or the consummation of the transactions
contemplated hereby and each of the Company and its subsidiaries has duly
performed or observed all material obligations, agreements, covenants or
conditions contained in any contract, indenture, mortgage, agreement or
instrument relating to any Indebtedness.
(p) None of the Company or its subsidiaries, or any agent acting on their
behalf, has taken or will take any action that might cause this Agreement or the
sale of the Notes to violate Regulation G, T, U or X of the Board of Governors
of the Federal Reserve System, in each case as in effect, or as the same may
hereafter be in effect, on the Closing Date.
(q) The Notes and the Indenture conform, in all material respects, to the
descriptions thereof in the Prospectus.
(r) Immediately after the consummation of the transactions contemplated by
this Agreement, the fair value and present fair saleable value of the assets of
the Company will exceed the sum of its stated liabilities and identified
contingent liabilities; the Company is not, nor will the Company be, after
giving effect to the execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby, (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 and otherwise) as they
mature or (iii) otherwise insolvent.
(s) To the best knowledge of the Company, KPMG LLP, who have certified
certain financial statements of the Company, whose report appears in the
Prospectus and who have delivered the initial letter referred to in Section 7(e)
hereof, are independent public accountants as required by the Securities Act and
the Rules and Regulations.
(t) The Company and each of its subsidiaries have good and marketable
title in fee simple to all real property and good and valid title to all
material personal property owned by them, in each case free and clear of all
liens, encumbrances and defects, except such as are described in the
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Prospectus or such as do not materially affect the value of such property and do
not materially interfere with the use made and proposed to be made of such
property by the Company and its subsidiaries; and all assets held under lease by
the Company and its subsidiaries are held by them under valid, subsisting and
enforceable leases, with such exceptions as are not material and do not
interfere with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries.
(u) The Company and each of its subsidiaries carry, or are covered by,
insurance in such amounts and covering such risks as is reasonably adequate for
the conduct of their respective businesses and the value of their respective
properties and as is customary for companies engaged in similar businesses in
similar industries.
(v) The Company and each of its subsidiaries own, license or possess
adequate rights to use all material patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service mark registrations,
copyrights and licenses necessary for the conduct of their respective businesses
and have no reason to believe that the conduct of their respective businesses
will conflict with, and have not received any notice of any claim of conflict
with, any such rights of others, except as disclosed in the Prospectus or where
the failure to so own, license or possess such rights would not, individually or
in the aggregate, have a Material Adverse Effect.
(w) There are no legal or governmental proceedings pending to which the
Company or any of its subsidiaries is a party or of which any property or assets
of the Company or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries, might have a Material
Adverse Effect; and to the best of the Company's knowledge, no such proceedings
are threatened or contemplated by governmental authorities or threatened by
others.
(x) There are no contracts, arrangements or other documents which are
required to be described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and Regulations
which have not been described in the Prospectus or filed as exhibits to the
Registration Statement or incorporated by reference therein as permitted by the
Rules and Regulations.
(y) No relationship, direct or indirect, exists between or among the
Company on the one hand, and any of its former or present directors, officers,
stockholders, customers or suppliers on the other hand, which is required to be
described in the Prospectus which is not so described.
(z) No labor disturbance by the employees of the Company exists or, to the
knowledge of the Company, is imminent, which might be expected to have a
Material Adverse Effect.
(aa) The Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income Security Act
of 1974, as amended, including the regulations and published interpretations
thereunder ("ERISA"); no "reportable event" (as defined in Section 4043 of
ERISA) has occurred with respect to any "defined benefit plan" (as defined in
Section 3(35) of ERISA) for which the Company would have any liability; the
Company has not incurred and does not expect to incur liability under (i) Title
IV of ERISA with respect to termination of, or withdrawal from, any "defined
benefit plan" or (ii) Sections 412 or 4971 of the Internal Revenue Code of 1986,
as amended, including the regulations and published interpretations thereunder
(the "Code"); and each "defined benefit plan" for which the Company has any
liability or to which it makes contributions that is intended to be qualified
under Section 401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which would cause
the loss of such qualification.
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(bb) The Company has filed all federal, state and local income and
franchise tax returns required to be filed through the date hereof and has paid
all taxes shown as due thereon, and no tax deficiency has been determined
adversely to the Company or any of its subsidiaries which has had (nor does the
Company have any knowledge of any tax deficiency which, if determined adversely
to the Company or any of its subsidiaries, might have) a Material Adverse
Effect. The are no tax audits presently being conducted which, if determined
adversely to the Company or any of its subsidiaries, could have a Material
Adverse Effect.
(cc) Since the date as of which information is given in the Prospectus
through the date hereof, and except as may otherwise be disclosed in the
Prospectus, the Company has not (i) issued or granted any securities, (ii)
incurred any material liability or obligation, direct or contingent, other than
liabilities and obligations which were incurred in the ordinary course of
business, (iii) entered into any transaction not in the ordinary course of
business, or (iv) declared or paid any dividend on its capital stock.
(dd) The Company (i) makes and keeps accurate books and records, and (ii)
maintains internal accounting controls which provide reasonable assurance that
(A) transactions are executed in accordance with management's general or
specific authorization, (B) transactions are recorded as necessary to permit
preparation of its financial statements and to maintain accountability for its
assets, (C) access to its assets is permitted only in accordance with
management's general or specific authorization and (D) the reported
accountability for its assets is compared with existing assets at reasonable
intervals.
(ee) Neither the Company nor any of its subsidiaries (i) is in violation
of its charter, certificate of designation, by-laws or similar governing
document, (ii) is in default in any material respect, and no event has occurred
which, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition contained
in any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which it is a party or by which it is bound or to which any of its
properties or assets is subject or (iii) is in violation in any material respect
of any law, ordinance, governmental rule, regulation or court decree to which it
or its property or assets may be subject.
(ff) Each of the radio stations owned, operated, programmed, or to which
sales and marketing services are provided, by the Company and its subsidiaries
is validly licensed by the Federal Communications Commission (the "FCC") and no
administrative or judicial proceedings are pending before or, to the knowledge
of the Company or its subsidiaries, threatened by the FCC with respect to such
licenses; the Company and its subsidiaries possess adequate certificates,
authorizations, consents, orders, approvals, licenses or permits which are in
full force and effect issued by all appropriate governmental agencies or bodies
necessary to the ownership of their respective properties and the conduct of the
businesses now operated by them and have not received any notice of proceedings
relating to the revocation or modification of any such certificate, authority,
consent, order, approval, license or permit and the Company and its subsidiaries
are in compliance in all material respects with the Communications Act of 1934,
as amended, and the rules, regulations and policies of the FCC.
(gg) The Company believes the statistical and market-related data included
in the Prospectus are accurate and are based on or derived from reliable
sources.
(hh) There has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of toxic wastes, medical
wastes, hazardous wastes or hazardous substances by the Company or any of its
subsidiaries (or, to the knowledge of the Company, any of their predecessors in
interest) at, upon or from any of the property now or previously owned or leased
by the Company or its subsidiaries in violation of any applicable law,
ordinance, rule, regulation, order,
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judgment, decree or permit or which would require remedial action under any
applicable law, ordinance, rule, regulation, order, judgment, decree or permit,
except for any violation or remedial action which would not have, or could not
be reasonably likely to have, singularly or in the aggregate with all such
violations and remedial actions, a Material Adverse Effect; there has been no
material spill, discharge, leak, emission, injection, escape, dumping or release
of any kind onto such property or into the environment surrounding such property
of any toxic wastes, medical wastes, solid wastes, hazardous wastes or hazardous
substances due to or caused by the Company or any of its subsidiaries or with
respect to which the Company or any of its subsidiaries have knowledge, except
for any such spill, discharge, leak, emission, injection, escape, dumping or
release which would not have or would not be reasonably likely to have,
singularly or in the aggregate with all such spills, discharges, leaks,
emissions, injections, escapes, dumpings and releases, a Material Adverse
Effect; and the terms "hazardous wastes", "toxic wastes", "hazardous substances"
and "medical wastes" shall have the meanings specified in any applicable local,
state, federal and foreign laws or regulations with respect to environmental
protection.
(ii) Neither the Company nor any subsidiary is, or, as of the Closing Date
after giving effect to the application of the net proceeds as described in the
Prospectus, will be, an "investment company" as defined in the Investment
Company Act of 1940, as amended.
(jj) The Company has complied with, and is and will be in compliance with,
the provisions of that certain Florida act relating to disclosure of doing
business with Cuba, codified as Section 517.075 of the Florida statutes, and the
rules and regulations thereunder or is exempt therefrom.
Section 2. Purchase of the Notes by the Underwriters. On the basis of the
representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell the Notes to the
several Underwriters and each of the Underwriters, severally and not jointly,
agrees to purchase the aggregate principal amount of Notes set opposite that
Underwriter's name in Schedule 1 hereto. Each Underwriter will purchase such
aggregate principal amount of Notes at an aggregate purchase price equal to ___%
of the principal amount thereof (the "Purchase Price").
The Company shall not be obligated to deliver any of the Notes to be
delivered on the Delivery Date (as hereinafter defined), except upon payment for
all the Notes to be purchased on the Delivery Date as provided herein.
Section 3. Offering of Notes by the Underwriters.
Upon authorization by the Underwriters of the release of the Notes, the
several Underwriters propose to offer the Notes for sale upon the terms and
conditions set forth in the Prospectus.
Section 4. Delivery of and Payment for the Notes. Delivery of and payment
for the Notes shall be made at the office of Rogers & Wells LLP, 200 Park
Avenue, New York, New York 10166 at 10:00 A.M., New York City time, on the fifth
full business day following the date of this Agreement or at such other date or
place as shall be determined by agreement between the Underwriters and the
Company. This date and time are sometimes referred to as the "Delivery Date." On
the Delivery Date, the Company shall deliver or cause to be delivered
certificates representing the Notes to the Underwriters for the account of each
Underwriter against payment to or upon the order of the Company of the purchase
price by certified or official bank check or checks payable in or wire transfer
in immediately available funds; provided, that the amount of such payment shall
be reduced by one days' interest on the amount of gross proceeds at the
Underwriters' cost of borrowing such funds plus any other expenses associated
with such payment of immediately available funds. Time shall be of the essence,
and delivery at the time and place specified pursuant to this Agreement is a
further condition of the obligation of each Underwriter hereunder. Upon
delivery, the Notes shall be registered in such names and in such denominations
as the Underwriters shall request in writing not less than two full business
days prior to the Delivery Date. For
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the purpose of expediting the checking and packaging of the certificates for the
Notes, the Company shall make the certificates representing the Notes available
for inspection by the Underwriters in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to the Delivery Date.
Section 5. Further Agreements of the Company. The Company agrees:
(a) To prepare the Prospectus in a form approved by the Underwriters and
to file such Prospectus pursuant to Rule 424(b) under the Securities Act not
later than Commission's close of business on the second business day following
the execution and delivery of this Agreement or, if applicable, such earlier
time as may be required by Rule 430A(a)(3) under the Securities Act; to make no
further amendment or any supplement to the Registration Statement or to the
Prospectus except as permitted herein; to advise the Underwriters, promptly
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any supplement to
the Prospectus or any amended Prospectus has been filed and to furnish the
Underwriters with copies thereof; to advise the Underwriters, promptly after it
receives notice thereof, of the issuance by the Commission of any stop order or
of any order preventing or suspending the use of any Preliminary Prospectus or
the Prospectus, of the suspension of the qualification of the Notes for offering
or sale in any jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or the Prospectus or for additional
information; and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or the Prospectus
or suspending any such qualification, to use promptly its best efforts to obtain
its withdrawal;
(b) To furnish promptly to each of the Underwriters and to counsel for the
Underwriters a signed copy of the Registration Statement as originally filed
with the Commission, and each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith;
(c) To deliver promptly to the Underwriters such number of the following
documents as the Underwriters shall reasonably request: (i) conformed copies of
the Registration Statement as originally filed with the Commission and each
amendment thereto (in each case excluding exhibits other than this Agreement and
the computation of the Ratio of Earnings to Fixed Charges) and (ii) each
Preliminary Prospectus, the Prospectus and any amended or supplemented
Prospectus; and, if the delivery of a prospectus is required at any time after
the Effective Time in connection with the offering or sale of the Notes or any
other securities relating thereto and if at such time any events shall have
occurred as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the Securities Act, to notify
the Underwriters and, upon their request, to prepare and furnish without charge
to each Underwriter and to any dealer in securities as many copies as the
Underwriters may from time to time reasonably request of an amended or
supplemented Prospectus which will correct such statement or omission or effect
such compliance.
(d) To file promptly with the Commission any amendment to the Registration
Statement or the Prospectus or any supplement to the Prospectus that may, in the
judgment of the Company or the Underwriters, be required by the Securities Act
or requested by the Commission;
(e) Prior to filing with the Commission any amendment to the Registration
Statement or supplement to the Prospectus or any Prospectus pursuant to Rule 424
of the Rules and Regulations, to furnish a copy thereof to the Underwriters and
counsel for the Underwriters and obtain the consent of the Underwriters to the
filing;
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(f) As soon as practicable after the Effective Date, to make generally
available to the Company's security holders and to deliver to the Underwriters
an earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Securities Act and the Rules and
Regulations (including, at the option of the Company, Rule 158);
(g) For a period of five years following the Effective Date, to furnish to
the Underwriters copies of all materials furnished by the Company to its
shareholders and holders of Notes and all public reports and all reports and
financial statements furnished by the Company to the principal national
securities exchange upon which the Class A Common Stock or Notes may be listed
pursuant to requirements of or agreements with such exchange or to the
Commission pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder;
(h) Promptly from time to time to take such action as the Underwriters may
reasonably request to qualify the Notes for offering and sale under the
securities laws of such jurisdictions as the Underwriters may request and to
comply with such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to complete the
distribution of the Notes; provided that in connection therewith the Company
shall not be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(i) To apply the net proceeds from the sale of the Notes as set forth in
the Prospectus; and
(j) To take such steps as shall be necessary to ensure that neither the
Company nor any subsidiary shall become an "investment company" as defined in
the Investment Company Act of 1940, as amended.
Section 6. Expenses. The Company agrees to pay (a) the costs incident to
the authorization, issuance, sale and delivery of the Notes and any taxes
payable in that connection; (b) the costs incident to the preparation, printing
and filing under the Securities Act of the Registration Statement and any
amendments and exhibits thereto; (c) the costs of distributing the Registration
Statement as originally filed and each amendment thereto and any post-effective
amendments thereof (including, in each case, exhibits), any Preliminary
Prospectus, the Prospectus and any amendment or supplement to the Prospectus,
all as provided in this Agreement; (d) the costs of producing and distributing
this Agreement and the Indenture, and any other related documents in connection
with the offering, purchase, sale and delivery of the Notes; (e) the filing fees
incident to securing the review by the National Association of Securities
Dealers, Inc. of the terms of sale of the Notes; (f) any applicable listing or
other fees; (g) the fees and expenses (not in excess, in the aggregate, of
$10,000) of qualifying the Notes under the securities laws of the several
jurisdictions as provided in Section 5(h) and of preparing, printing and
distributing a Blue Sky Memorandum (including related fees and expenses of
counsel to the Underwriters); (h) any fees charged by securities rating agencies
for rating the Notes; (i) the costs and expenses of the Company relating to
investor presentations on any "road show" undertaken in connection with the
marketing of the offering of the Notes, including, without limitation, expenses
associated with the production of road show slides and graphics, fees and
expenses of any consultants engaged in connection with the road show
presentations with the prior approval of the Company, travel and lodging
expenses of the representatives and officers of the Company and any such
consultants, and the cost of any aircraft chartered in connection with the road
show (i) and (j) all other costs and expenses incident to the performance of the
obligations of the Company under this Agreement; provided that, except as
provided in this Section 6 and in Section 10 the Underwriters shall pay their
own costs and expenses, including the costs and expenses of their counsel, any
transfer taxes on the Notes which they may sell and the expenses of advertising
any offering of the Notes made by the Underwriters.
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Section 7. Conditions of Underwriters' Obligations. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when made
and on the Delivery Date, of the representations and warranties of the Company
contained herein, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) The Prospectus shall have been timely filed with the Commission in
accordance with Section 5(a); no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and any request of the Commission for inclusion of additional
information in the Registration Statement or the Prospectus or otherwise shall
have been complied with.
(b) No Underwriter shall have discovered and disclosed to the Company on
or prior to the Delivery Date that the Registration Statement or the Prospectus
or any amendment or supplement thereto contains an untrue statement of fact
which, in the opinion of Rogers & Wells LLP, counsel for the Underwriters, is
material or omits to state a fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make the
statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Indenture, the Notes,
the Registration Statement and the Prospectus, and all other legal matters
relating to this Agreement, and the transactions contemplated hereby shall be
reasonably satisfactory in all material respects to counsel for the
Underwriters, and the Company shall have furnished to such counsel all documents
and information that they may reasonably request to enable them to pass upon
such matters.
(d) Kaye, Scholer, Fierman, Hays & Handler LLP shall have furnished to the
Underwriters their written opinion, as counsel to the Company, addressed to the
Underwriters and dated the Delivery Date, in form and substance reasonably
satisfactory to the Underwriters, to the effect that:
(i) The Company and each of its subsidiaries have been duly
incorporated and are validly existing as corporations in good standing under the
laws of their respective jurisdictions of incorporation, are duly qualified to
do business and are in good standing as foreign corporations in each
jurisdiction in which their respective ownership or lease of property or the
conduct of their respective businesses requires such qualification and have all
power and authority necessary to own or hold their respective properties and
conduct the businesses in which they are engaged;
(ii) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued, are fully paid and
nonassessable and conform to the description thereof contained in the
Prospectus; and all of the issued shares of capital stock of each subsidiary of
the Company have been duly and validly authorized and issued and are fully paid,
non-assessable and (except for directors' qualifying shares) are owned directly
or indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims and none of such shares of capital stock was issued in
violation of preemptive or other similar rights arising by operation of law,
under the charter and by-laws of the Company or under any agreement known to
such counsel to which the Company or any subsidiary is a party or otherwise;
(iii) The Notes have been duly authorized, executed and issued by
the Company and, assuming due authentication thereof by the Trustee and upon
payment and delivery in accordance with the terms of the Underwriting Agreement,
will be entitled to the benefits of the Indenture and will be validly issued and
free and clear of all liens and restrictions on transfer and will constitute
valid and legally binding obligations of the Company enforceable against the
Company in accordance
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with their terms except as (i) enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
(ii) rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability;
(iv) The Notes conform to the descriptions thereof contained in
the Registration Statement, the Prospectus and the Indenture. The Indenture
conforms to the description thereof in the Registration Statement and the
Prospectus;
(v) To the best of such counsel's knowledge and other than as set
forth in the Prospectus, there are no legal or governmental proceedings pending
to which the Company or any of its subsidiaries is a party or of which any
property or assets of the Company or any of its subsidiaries is the subject
which, if determined adversely to the Company or any of its subsidiaries, might
have a material adverse effect on the consolidated financial position,
stockholders' equity, results of operations, business or prospects of the
Company and its subsidiaries taken as a whole; and, to the best of such
counsel's knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(vi) The Registration Statement has been declared effective under
the Securities Act and the Indenture was qualified under the Trust Indenture
Act, the Prospectus was filed with the Commission pursuant to the subparagraph
of Rule 424(b) of the Rules and Regulations specified in such opinion on the
date specified therein and no stop order suspending the effectiveness of the
Registration Statement has been issued and, to the knowledge of such counsel, no
proceeding for that purpose is pending or threatened by the Commission;
(vii) The Registration Statement and the Prospectus and any
further amendments or supplements thereto made by the Company prior to such
Delivery Date (except for the financial statements and financial schedules and
other financial and statistical data included therein, as to which such counsel
need express no belief) comply as to form in all material respects with the
requirements of the Securities Act and the Rules and Regulations;
(viii) The statements contained in the Prospectus under the
captions "Risk Factors- Government Regulation," "Risk Factors- Antitrust
Matters," "Description of Notes," "Description of Other Indebtedness," "Certain
Federal Income Tax Considerations," "Business -- Antitrust," "Business --
Federal Regulation of Radio Broadcasting," "Business- FCC Licenses," "Executive
Compensation- Employment Agreement and Arrangements," "Executive Compensation-
Option Plan," "Executive Compensation- Limitation on Directors' and Officers'
Liability," insofar as they describe contracts, agreements or other legal
documents or they describe federal statutes, rules and regulations, constitute a
fair summary thereof;
(ix) To the best of such counsel's knowledge, there are no
contracts, arrangements or other documents which are required to be described in
the Prospectus or filed as exhibits to the Registration Statement by the
Securities Act or by the Rules and Regulations which have not been described or
filed as exhibits to the Registration Statement or incorporated therein as
permitted by the Rules and Regulations;
(x) This Agreement has been duly authorized, executed and
delivered by the Company; and each of the other documents relating to the this
Agreement to which the Company is a party has been duly authorized, executed and
delivered by the Company;
(xi) The Indenture has been duly authorized, executed and
delivered by the Company and duly qualified under the Trust Indenture Act of
1939, as amended (the "Trust Indenture
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Act") and assuming due authorization, execution and delivery thereof by the
Trustee, constitutes a valid and, legally binding obligation of the Company
enforceable against the Company in accordance with its terms except as (i)
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability;
(xii) The issue and sale of the Notes being delivered on the
Delivery Date by the Company pursuant to this Agreement and the execution,
delivery and compliance by the Company with all of the provisions of this
Agreement, the Indenture, the Notes and each of the other documents to be
entered into in connection with the consummation of the transactions
contemplated hereby, thereby and in the Registration Statement and the
Prospectus (including the issuance and sale of the Notes and the use of proceeds
from the sale of the Notes as described under the caption "Use of Proceeds")
will not conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement, license (including FCC Licenses (as
hereinafter defined )) or instrument known to such counsel to which the Company
or any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, nor will such actions result in any
violation of the provisions of the charter, certificate of designation, by-laws
or similar governing document of the Company or any of its subsidiaries or any
New York or federal statute, rule or regulation (including the Federal
Communications Laws (as hereinafter defined)) or any order, judgment or decree
known to such counsel; and, except for the registration of the Notes under the
Securities Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and applicable state
securities laws in connection with the purchase and distribution of the Notes by
the Underwriters, no consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or body (including
pursuant to the Communications Act of 1934, as amended and the rules,
regulations and administrative orders promulgated thereunder (collectively, the
Federal Communications Laws")) is required for the execution, delivery and
performance of this Agreement, the Indenture, the Notes or any of the other
documents to be entered into in connection with this Agreement by the Company
and the consummation of the transactions contemplated hereby or thereby,
including the issue, sale and delivery of the Notes to be issued, sold and
delivered by the Company hereunder;
(xiii) To such counsel's knowledge, except as described 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 Securities 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 Securities Act;
(xiv) Except as described in the Prospectus, to the best of such
counsel's knowledge, there are no contracts, agreements or understandings
between the Company and any person granting such person the right (other than
rights which have been waived or satisfied) to require the Company to file a
registration statement under the Securities 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 Securities Act;
(xv) The Company and its subsidiaries are the holders of the FCC
licenses listed in an attachment to such opinion (the "FCC Licenses"), all of
which are in full force and effect, for the maximum term customarily issued,
with no material conditions, restrictions or qualifications other
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than as described in the Prospectus, and to such counsel's knowledge, such FCC
Licenses constitute all of the commercial radio station licenses necessary for
the Company and the subsidiaries to operate their radio stations as described in
the Prospectus;
(xvi) There are no published or, to such counsel's knowledge,
unpublished FCC orders, decrees or rulings outstanding against the Company or
any of its subsidiaries or any pending or threatened actions, suits or
proceedings against the Company or any of its subsidiaries by or before the FCC
that seek to revoke, or if determined adversely to the Company or any of its
subsidiaries, would have a material adverse effect on the Company and its
subsidiaries taken as whole or would result in a revocation or nonrenewal of,
any of the FCC Licenses, other than as disclosed in the Registration Statement
or Prospectus;
(xvii) Neither the Company nor any subsidiary is an "investment
company" as defined in the Investment Company Act of 1940, as amended;
In rendering such opinion, such counsel may state that their 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. Such opinion shall also be to the effect that (x) such counsel has
acted as counsel to the Company in connection with the preparation of the
Registration Statement and (y) based on the foregoing, no facts have come to the
attention of such counsel which lead them to believe that the Registration
Statement (except for the financial statements and financial schedules and other
financial, statistical and market data included therein, as to which such
counsel need express no belief) as of the Effective Date, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading, or that the Prospectus (except as stated above) contains any untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. The foregoing
opinion and statement may be qualified by a statement to the effect that such
counsel does not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus (other than as set forth in clause (viii) above).
(e) The Underwriters shall have received from Rogers & Wells LLP, counsel
for the Underwriters, such opinion or opinions, dated the Delivery Date, with
respect to the issuance and sale of the Notes, the Registration Statement, the
Prospectus and other related matters as the Underwriters may reasonably require,
and the Company shall have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass upon such matters.
(f) At the time of execution of this Agreement, the Underwriters shall
have received from each of KPMG LLP and PricewaterhouseCoopers LLP, a letter, in
form and substance satisfactory to the Underwriters, addressed to the
Underwriters and dated the date hereof (i) confirming that they are independent
public accountants within the meaning of the Securities Act and are in
compliance with the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X of the Commission and (ii)
stating, as of the date hereof (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five days
prior to the date hereof), the conclusions and findings of such firm with
respect to the financial information and other matters ordinarily covered by
accountants' "comfort letters" to underwriters in connection with registered
public offerings.
(g) With respect to the letters of each of KPMG LLP and
PricewaterhouseCoopers LLP referred to in the preceding paragraph and delivered
to the Underwriters concurrently with the execution of this Agreement (the
"initial letters"), the Company shall have furnished to the Underwriters letters
(the "bring-down letters") of such
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accountants, addressed to the Underwriters and dated the Delivery Date (i)
confirming that they are independent public accountants within the meaning of
the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, (ii) stating, as of the date of the bring-down letters (or,
with respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the Prospectus, as
of a date not more than five days prior to the date of the bring-down letters),
the conclusions and findings of such firms with respect to the financial
information and other matters covered by the initial letters and (iii)
confirming in all material respects the conclusions and findings set forth in
the initial letters.
(h) The Company shall have furnished to the Underwriters a certificate,
dated such Delivery Date, of its Chairman of the Board, its President or a Vice
President and its chief financial officer stating that:
(i) The representations, warranties and agreements of the Company
in Section 1 are true and correct as of the Delivery Date; the Company has
complied with all its agreements contained herein; and the conditions set forth
in Sections 7(a), 7(i) and 7(j) have been fulfilled; and
(ii) They have carefully examined the Registration Statement and
the Prospectus and, in their opinion (A) as of the Effective Date, the
Registration Statement and Prospectus did not include any untrue statement of a
material fact and did not omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and (B)
since the Effective Date no event has occurred which should have been set forth
in a supplement or amendment to the Registration Statement or the Prospectus.
(i) Neither the Company nor any of its subsidiaries shall have sustained
since the date of the latest audited financial statements included in the
Prospectus (A) any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus or (B) since such date there shall not
have been any change in the capital stock or long-term debt of the Company or
any of its subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the Prospectus, the
effect of which, in any such case described in clause (A) or (B), is, in the
judgment of the Underwriters, so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Notes being delivered on the Delivery Date on the terms and in the manner
contemplated in the Prospectus.
(j) Subsequent to the execution and delivery of this Agreement (i) no
downgrading shall have occurred in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization", as
that term is defined by the Commission for purposes of Rule 436(g)(2) of the
Rules and Regulations and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities.
(k) Subsequent to the execution and delivery of this Agreement there shall
not have occurred any of the following: (i) trading in securities generally on
the New York Stock Exchange, the American Stock Exchange, the Nasdaq Stock
Market's National Market or in the over-the-counter market, or trading in any
securities of the Company on any exchange or in the over-the-counter market,
shall have been suspended or minimum prices shall have been established on any
such exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority
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having jurisdiction, (ii) a banking moratorium shall have been declared by
Federal or state authorities, (iii) the United States shall have become engaged
in hostilities, there shall have been an escalation in hostilities involving the
United States or there shall have been a declaration of a national emergency or
war by the United States or (iv) there shall have occurred such a material
adverse change in general economic, political or financial conditions (or the
effect of international conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of the Underwriters, impracticable
or inadvisable to proceed with the public offering or delivery of the Notes
being delivered on the Delivery Date on the terms and in the manner contemplated
in the Prospectus.
(l) The closing under the Equity Underwriting Agreement shall have
occurred prior to the closing hereunder on the Delivery Date.
(m) The Company shall have commenced a tender offer and consent
solicitation with respect to its 11% Senior Notes due 2004 (the "2004 Notes")
and 12-1/2% Senior Notes due 2002 (the "2002 Notes"), and shall have accepted
and paid for, not less than a majority in aggregate principal amount of the
outstanding 2004 Notes and 2002 Notes.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
Section 8. Indemnification and Contribution.
(a) The Company and Spanish Broadcasting System, Inc., a New Jersey
corporation, Spanish Broadcasting System of Greater Miami, Inc., a Delaware
corporation, Spanish Broadcasting System of Illinois, Inc., a Delaware
corporation, Spanish Broadcasting System of San Antonio, Inc., a Delaware
corporation (collectively, the "Principal Subsidiaries"), jointly and severally,
shall indemnify and hold harmless each Underwriter, its officers and employees
and each person, if any, who controls any Underwriter within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases and sales of the
Notes), to which that Underwriter, officer, employee or controlling person may
become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus or in any
amendment or supplement thereto, (ii) the omission or alleged omission to state
in any Preliminary Prospectus, the Registration Statement or the Prospectus, or
in any amendment or supplement thereto, any material fact required to be stated
therein or necessary to make the statements therein not misleading, or (iii) any
act or failure to act or any alleged act or failure to act by any Underwriter in
connection with, or relating in any manner to, the Notes or the offering
contemplated hereby, and which is included as part of or referred to in any
loss, claim, damage, liability or action arising out of or based upon matters
covered by clause (i) or (ii) above (provided that the Company and the Principal
Subsidiaries shall not be liable under this clause (iii) to the extent that it
is determined in a final judgment by a court of competent jurisdiction that such
loss, claim, damage, liability or action resulted directly from any such acts or
failures to act undertaken or omitted to be taken by such Underwriter through
its gross negligence or willful misconduct), and shall reimburse each
Underwriter and each such officer, employee or controlling person promptly upon
demand for any legal or other expenses reasonably incurred by that Underwriter,
officer, employee or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred; provided, however, that the Company and
the Principal Subsidiaries shall not be liable in any such case to the extent
that any such loss, claim, damage, liability or action arises out of, or is
based upon, any untrue statement or alleged untrue statement or omission or
alleged
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omission made in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any such amendment or supplement, in reliance upon and in
conformity with written information concerning such Underwriter furnished to the
Company by or on behalf of any Underwriter specifically for inclusion therein
which information consists solely of the information specified in Section 8(e)
provided, further however, that the Company and the Principal Subsidiaries shall
not be liable to any Underwriter under the agreement in this subsection 8(a)
with respect to any Prospectus to the extent that any such loss, claim, damage
or liability of such Underwriter results from the fact that such Underwriter
sold Notes to a person as to whom there was not sent or given, at or prior to
written confirmation of such sale, a copy of the Prospectus or of the Prospectus
as then amended or supplemented in any case where such delivery is required by
the Securities Act if the Company previously furnished copies thereof in the
quantity requested in accordance with Section 5(c) hereof to such Underwriter
and the loss, claim, damage or liability of such Underwriter results from an
untrue statement or omission of a material fact contained in the Prospectus and
corrected in the Prospectus or the Prospectus as then amended or supplemented.
The foregoing indemnity agreement is in addition to any liability which the
Company and the Principal Subsidiaries may otherwise have to any Underwriter or
to any officer, employee or controlling person of that Underwriter. The
foregoing indemnity agreement is in addition to any liability which the Company
and the Principal Subsidiaries may otherwise have to any Underwriter or to any
officer, employee or controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and hold
harmless the Company, its officers and employees, each of its directors, and
each person, if any, who controls the Company within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which the Company or any such
director, officer or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus or in any amendment or supplement
thereto, or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, any material fact required to be stated therein or necessary
to make the statements therein not misleading, but in each case only to the
extent that the untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information concerning such Underwriter furnished to the Company by or on behalf
of that Underwriter specifically for inclusion therein, and shall reimburse the
Company and any such director, officer or controlling person for any legal or
other expenses reasonably incurred by the Company or any such director, officer
or controlling person in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability which any Underwriter may otherwise have to the Company or any such
director, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 8 except to the extent it has been materially
prejudiced by such failure and, provided further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 8. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such
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claim or action, the indemnifying party shall not be liable to the indemnified
party under this Section 8 for any legal or other expenses subsequently incurred
by the indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, that the Underwriters
shall have the right to employ counsel to represent jointly the Underwriters and
their respective officers, employees and controlling persons who may be subject
to liability arising out of any claim in respect of which indemnity may be
sought by the Underwriters against the Company or the Principal Subsidiaries
under this Section 8 if, in the reasonable judgment of the Underwriters, it is
advisable for the Underwriters and their officers, employees and controlling
persons to be jointly represented by separate counsel, and in that event the
fees and expenses of such separate counsel shall be paid by the Company or the
Principal Subsidiaries, as the case may be. No indemnifying party shall (i)
without the prior written consent of the indemnified parties (which consent
shall not be unreasonably withheld), settle or compromise or consent to the
entry of any judgment with respect to any pending or threatened claim, action,
suit or proceeding in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with the consent of
the indemnifying party or if there be a final judgment of the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold harmless any
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 8(a) or 8(b) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such proportion
as shall be appropriate to reflect the relative benefits received by the Company
and the Principal Subsidiaries on the one hand and the Underwriters on the other
from the offering of the Notes or (ii) if the allocation provided by clause (i)
above 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 and the Principal Subsidiaries on the one
hand and the Underwriters on the other with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Principal Subsidiaries on the
one hand and the Underwriters on the other with respect to such offering shall
be deemed to be in the same proportion as the total net proceeds from the
offering of the Notes purchased under this Agreement (before deducting expenses)
received by the Company and the Principal Subsidiaries, on the one hand, and the
total underwriting discounts and commissions received by the Underwriters with
respect to the Notes purchased under this Agreement, on the other hand, bear to
the total gross proceeds from the offering of the Notes under this Agreement, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to whether the 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 and the Principal
Subsidiaries or the Underwriters, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. For purposes of the preceding two sentences, the net
proceeds deemed to be received by the Company shall be deemed to be also for the
benefit of the Principal Subsidiaries and information supplied by the Company
shall also be deemed to have been supplied by the Principal Subsidiaries. The
Company and the Principal Subsidiaries and the Underwriters agree that it would
not be just and equitable if contributions pursuant to this Section were to be
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 into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a
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result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section shall be deemed to include, for purposes of
this Section 8(e), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 8(e), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Notes underwritten by it and distributed to the public
was offered to the public exceeds the amount of any damages which such
Underwriter has otherwise paid or become liable to pay by reason of any 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
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute as provided in this Section 8(d) are several in proportion to their
respective underwriting obligations and not joint.
(e) The Underwriters severally confirm and the Company acknowledges that
the statements with respect to the public offering of the Notes by the
Underwriters set forth on the cover page of, and the concession and reallowance
figures appearing under the caption "Underwriting" in, the Prospectus are
correct and constitute the only information concerning such Underwriters
furnished in writing to the Company by or on behalf of the Underwriters
specifically for inclusion in the Registration Statement and the Prospectus.
Section 9. Termination. The obligations of the Underwriters hereunder may
be terminated by the Underwriters by notice given to and received by the Company
prior to delivery of and payment for the Notes if, prior to that time, any of
the events described in Sections 7(i), 7(j) or 7(k), shall have occurred or if
the Underwriters shall decline to purchase the Notes for any reason permitted
under this Agreement.
Section 10. Reimbursement of Underwriters' Expense. If the Company shall
fail to tender the Notes for delivery to the Underwriters by reason of any
failure, refusal or inability on the part of the Company to perform any
agreement on its part to be performed, or because any other condition of the
Underwriters' obligations hereunder required to be fulfilled by the Company is
not fulfilled, the Company will reimburse the Underwriters for all reasonable
out-of-pocket expenses (including fees and disbursements of counsel) incurred by
the Underwriters in connection with this Agreement and the proposed purchase of
the Notes, and upon demand the Company shall pay the full amount thereof to the
Underwriters.
Section 11. Notices, Etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission to Lehman Brothers Inc., Three World Financial Center,
New York, New York 10285, Attention: Syndicate Department (Fax: 212-526-6588),
with a copy, in the case of any notice pursuant to Section 8(c), to the Director
of Litigation, Office of the General Counsel, Lehman Brothers Inc., 3 World
Financial Center, 10th Floor, New York, NY 10285;
(b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: [ ] (Fax: );
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Underwriters, which address will be supplied to any other party hereto by the
Underwriters upon request. Any such statements, requests, notices or agreements
shall take effect at the time of receipt
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thereof. The Company shall be entitled to act and rely upon any request,
consent, notice or agreement given or made on behalf of the Underwriters by
Lehman Brothers Inc.
Section 12. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the Underwriters and the Company,
and their respective personal representatives and successors. This Agreement and
the terms and provisions hereof are for the sole benefit of only those persons,
except that (A) the representations, warranties, indemnities and agreements of
the Company contained in this Agreement shall also be deemed to be for the
benefit of the person or persons, if any, who control any Underwriter within the
meaning of Section 15 of the Securities Act and (B) the indemnity agreement of
the Underwriters contained in Section 8(b) of this Agreement shall be deemed to
be for the benefit of directors of the Company, officers of the Company who have
signed the Registration Statement and any person controlling the Company within
the meaning of Section 15 of the Securities Act. Nothing in this Agreement is
intended or shall be construed to give any person, other than the persons
referred to in this Section 13, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision contained herein.
Section 13. Survival. The respective indemnities, representations,
warranties and agreements of the Company, the Principal Subsidiaries and the
Underwriters contained in this Agreement or made by or on behalf on them,
respectively, pursuant to this Agreement, shall survive the delivery of and
payment for the Notes and shall remain in full force and effect, regardless of
any investigation made by or on behalf of any of them or any person controlling
any of them.
Section 14. Definition of the Terms "Business Day" and "subsidiary". For
purposes of this Agreement, (a) "business day" means each Monday, Tuesday,
Wednesday, Thursday or Friday which is not a day on which banking institutions
in New York are generally authorized or obligated by law or executive order to
close and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
Section 15. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of New York.
Section 16. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
Section 17. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
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If the foregoing correctly sets forth the agreement between the Company
and the Underwriters, please indicate your acceptance in the space provided for
that purpose below.
Very truly yours,
SPANISH BROADCASTING SYSTEM, INC.
By --------------------------------
Name:
Title:
SPANISH BROADCASTING SYSTEM, INC.
(a New Jersey corporation)
By --------------------------------
Name:
Title:
SPANISH BROADCASTING SYSTEM OF
GREATER MIAMI, INC.
By --------------------------------
Name:
Title:
SPANISH BROADCASTING SYSTEM OF
ILLINOIS, INC.
By --------------------------------
Name:
Title:
SPANISH BROADCASTING SYSTEM OF
SAN ANTONIO, INC.
By --------------------------------
Name:
Title:
Accepted:
LEHMAN BROTHERS INC.
CIBC WORLD MARKETS CORP.
By LEHMAN BROTHERS INC.
By -------------------------------
Authorized Representative
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SCHEDULE 1
Principal Amount of
U.S. Underwriters Notes to be Purchased
- ----------------- ---------------------
Lehman Brothers Inc.......................
CIBC World Markets Corp...................
Total..................................... $ 235,000,000