<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 10, 1997
REGISTRATION NO. 333-24601
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
AMENDMENT NO. 3 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------------
METROMEDIA INTERNATIONAL GROUP, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 58-0971455
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
ONE MEADOWLANDS PLAZA
EAST RUTHERFORD, NEW JERSEY 07073-2137
(201) 531-8000
(Address, including zip code and telephone number, including area code, of
Registrant's principal executive offices)
ARNOLD L. WADLER, ESQ.
EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
METROMEDIA INTERNATIONAL GROUP, INC.
ONE MEADOWLANDS PLAZA
EAST RUTHERFORD, NEW JERSEY 07073-2137
(201) 531-8000
(Name, address, including zip code, and telephone number, including area code of
agent for service)
------------------------------
COPIES OF COMMUNICATIONS TO:
<TABLE>
<S> <C>
JAMES M. DUBIN, ESQ. NICHOLAS P. SAGGESE, ESQ.
PAUL, WEISS, RIFKIND, WHARTON & GARRISON SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
1285 AVENUE OF THE AMERICAS 300 SOUTH GRAND AVENUE, 34TH FLOOR
NEW YORK, NEW YORK 10019-6064 LOS ANGELES, CALIFORNIA 90071
(212) 373-3000 (213) 687-5000
</TABLE>
------------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the Registration Statement becomes effective.
------------------------------
If the securities registered on this Form are being offered pursuant to
dividend or interest reinvestment plans, please check the following box. / /
If any of the securities registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier
registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If the delivery of the Prospectus is expected to be made pursuant to Rule
434, please check the following box. / /
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF SHARES AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED SHARE PRICE FEE
<S> <C> <C> <C> <C>
% Cumulative Convertible Preferred Stock,
$1.00 par value per share................. 3,450,000(1) $50.00 $172,500,000 $52,273(2)(3)
Common Stock, $1.00 par value per share..... (1)(4) -- -- --(5)
</TABLE>
(1) Includes shares to cover exercise of the Underwriters' over-allotment
option, if any.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933, as amended (the
"Securities Act"), based upon the $50.00 price per share at which the
Preferred Stock was initially sold.
(3) $43,561 was wired on April 4, 1997 to the Securities and Exchange
Commission's (the "Commission") account at Mellon Bank and an additional
$8,712 was wired to the Commission's account on August 6, 1997, in full
payment of the required registration fee due in connection with this
Registration Statement.
(4) The shares of Common Stock being registered hereunder include the number of
shares of Common Stock initially issuable upon conversion of the Preferred
Stock ( shares) plus such indeterminate number of additional shares as
may become issuable upon conversion of the Preferred Stock as a result of
adjustments in the conversion price thereof or upon redemption and dividend
payments made on the Preferred Stock by the delivery of Common Stock in
accordance with the terms of the Preferred Stock.
(5) Pursuant to Rule 457(i) under the Securities Act, no registration fee is
required for the Common Stock issuable upon conversion of the Preferred
Stock because no additional consideration will be required in connection
with the issuance of such shares.
------------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE
ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the expenses (other than underwriting
discounts and commissions) expected to be incurred in connection with the
issuance and distribution of the securities registered hereby, all of which
expenses, except for the Commission registration fee, the National Association
of Securities Dealers, Inc. ("NASD") filing fee and the AMEX and PSE listing
fees, are estimated:
<TABLE>
<S> <C>
Commission registration fee....................................... $ 52,273
NASD filing fee................................................... 17,850
AMEX and PSE listing fees......................................... 37,500
Printing expenses................................................. 200,000
Legal fees and expenses (other than Blue Sky)..................... 300,000
Accounting fees and expenses...................................... 175,000
Blue Sky fees and expenses (including legal fees)................. 20,000
Miscellaneous..................................................... 47,377
---------
Total....................................................... $ 850,000
---------
---------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the General Corporation Law of the State of Delaware (the
"Delaware Law") empowers a Delaware corporation to indemnify any persons who
are, or are threatened to be made, parties to any threatened, pending or
completed legal action, suit or proceedings, whether civil, criminal,
administrative or investigative (other than an action by or in the right of such
corporation), by reason of the fact that such person was an officer, director,
employee or agent of such corporation, or is or was serving at the request of
such corporation as a director, officer, employee or agent of another
corporation or enterprise. The indemnity may include judgments, fines, amounts
paid in settlement and expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection with such action, suit or
proceeding, provided that such officer or director acted in good faith and in a
manner he reasonably believed to be in or not opposed to the corporation's best
interests, and, with respect to criminal proceedings, had no reasonable cause to
believe his conduct was illegal. A Delaware corporation may indemnify its
officers and directors against expenses actually and reasonably incurred by them
in connection with an action by or in the right of the corporation under the
same conditions, except that no indemnification is permitted without judicial
approval if the officer or director is adjudged to be liable to the corporation
in the performance of his duty. Where an officer or director is successful on
the merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him against the expenses which such officer or
director actually and reasonably incurred in connection therewith.
Section 102(b)(7) of the Delaware Law further provides that a corporation in
its certificate of incorporation may eliminate or limit the personal liability
of its directors to the corporation or its stockholders for breach of their
fiduciary duties in certain circumstances.
In accordance with Section 145 of the Delaware Law, the Company's Restated
Certificate of Incorporation provides that the Company shall indemnify its
officers and directors against, among other things, any and all judgments,
fines, penalties, amounts paid in settlements and expenses paid or incurred by
virtue of the fact that such officer or director was acting in such capacity to
the extent not prohibited by law.
In addition, as permitted by Section 102(b)(7) of the Delaware Law, the
Company's Restated Certificate of Incorporation contains a provision limiting
the personal liability of the Company's directors
II-1
<PAGE>
for violations of their fiduciary duties to the fullest extent permitted by the
Delaware Law. This provision eliminates each director's liability to the Company
or its stockholders for monetary damages except (i) for any breach of the
director's duty of loyalty to the Company or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the Delaware Law, or (iv) for any
transaction from which a director derived an improper personal benefit. The
general effect of this provision is to eliminate a director's personal liability
for monetary damages for actions involving a breach of his or her fiduciary duty
of care, including any such actions involving gross negligence.
Also, in accordance with the Delaware Law and pursuant to the Company's
Restated Certificate of Incorporation, the Company is authorized to purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee or agent of the Company, is or was serving at the request of the
Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against any liability
asserted against such person and incurred by such person in any such capacity,
or arising out of such person's status as such, whether or not the Company would
have the power to indemnify such person against liability under the Delaware
Law.
The Company has entered into agreements (the "Indemnification Agreements")
with certain directors and officers of the Company (the "Indemnified Parties")
which require the Company to indemnify each Indemnified Party against, and to
advance expenses incurred by each Indemnified Party in the defense of, any claim
arising out of his or her employment to the fullest extent permitted under law.
The Indemnification Agreements also provide, among other things, for (i)
advancement by the Company of expenses incurred by the director or officer in
defending certain litigation, (ii) the appointment of an independent legal
counsel to determine whether the director or officer is entitled to indemnity
and (iii) the continued maintenance by the Company of directors' and officers'
liability insurance providing each director or officer who is a party to any
such agreement with $5 million of primary coverage and an excess policy
providing $5 million of additional coverage. These Indemnification Agreements
were approved by the stockholders at the Company's 1993 Annual Meeting of
Stockholders.
II-2
<PAGE>
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
A. EXHIBITS
The exhibits listed below are filed as part of or incorporated by reference
in this Registration Statement. Where such filing is made by incorporation by
reference to a previously filed report, such report is identified in
parentheses. See the Index of Exhibits included with the exhibits filed as part
of this Registration Statement.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<C> <S>
1* Form of Underwriting Agreement.
4.1* Form of Certificate of Designation of the % Cumulative Convertible Preferred Stock of the Company.
5* Opinion of Paul, Weiss, Rifkind, Wharton & Garrison regarding the legality of the securities being
registered.
23.1** Consent of KPMG Peat Marwick LLP regarding the Registrant.
23.2** Consent of Ernst & Young LLP regarding the Registrant.
23.3* Consent of Price Waterhouse LLP regarding Goldwyn.
23.4* Consent of Paul, Weiss, Rifkind, Wharton & Garrison (included in the opinion filed as Exhibit 5
hereto).
24** Power of Attorney.
</TABLE>
- ------------------------
* Filed herewith.
** Filed previously.
B. FINANCIAL STATEMENT SCHEDULES
Financial Statement Schedules have been omitted because they are not
applicable or not required or because the information has been incorporated by
reference.
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
II-3
<PAGE>
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if the
registration statement is on Form S-3 or Form S-8, and the information required
to be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to section 13(a) or section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
The Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of Prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
Prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of Prospectus shall
be deemed to be a new Registration Statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to the initial BONA FIDE offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant certifies
that it has reasonable grounds to believe that it meets the requirements for
filing on Form S-3 and has duly caused this Amendment No. 3 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York.
METROMEDIA INTERNATIONAL GROUP, INC.
By: /s/ STUART SUBOTNICK
-----------------------------------------
Stuart Subotnick
PRESIDENT AND CHIEF EXECUTIVE OFFICER
Date: September 10, 1997
Pursuant to the requirements of the Securities Act, this Amendment to the
Registration Statement has been signed by the following persons in the
capacities indicated on the 10th day of September, 1997.
SIGNATURE TITLE
- ------------------------------ ---------------------------
* Chairman of the Board
- ------------------------------
John W. Kluge
Vice Chairman of the Board,
* President and Chief
- ------------------------------ Executive Officer
Stuart Subotnick (Principal Executive
Officer)
Executive Vice President,
/s/ SILVIA KESSEL Chief Financial Officer
- ------------------------------ and Director (Principal
Silvia Kessel Financial Officer)
* Executive Vice President,
- ------------------------------ General Counsel and
Arnold L. Wadler Director
* Senior Vice President
- ------------------------------ (Principal Accounting
Robert A. Maresca Officer)
* Director
- ------------------------------
John P. Imlay, Jr.
* Director
- ------------------------------
Clark A. Johnson
* Director
- ------------------------------
Richard J. Sherwin
II-5
<PAGE>
SIGNATURE TITLE
- ------------------------------ ---------------------------
* Director
- ------------------------------
Leonard White
* Director
- ------------------------------
Carl E. Sanders
*By: /s/ SILVIA KESSEL
------------------------------
Silvia Kessel
ATTORNEY-IN-FACT
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DOCUMENT
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<C> <S>
1.1 Form of Underwriting Agreement
4.1 Form of Certificate of Designation of the % Cumulative Convertible Preferred Stock of the Company
5 Opinion of Paul, Weiss, Rifkind, Wharton & Garrison regarding the legality of the securities being
registered
23.4 Consent of Paul, Weiss, Rifkind, Wharton & Garrison (included in the opinion filed as Exhibit 5
hereto)
</TABLE>
<PAGE>
Exhibit 1.1
3,000,000 Shares
METROMEDIA INTERNATIONAL GROUP, INC.
% Cumulative Convertible Preferred Stock
UNDERWRITING AGREEMENT
September 10, 1997
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
GOLDMAN, SACHS & CO.
CHASE SECURITIES INC.
FURMAN SELZ LLC
RC SECURITIES, INC.
c/o Donaldson, Lufkin & Jenrette Securities Corporation
277 Park Avenue
New York, New York 10172
Ladies and Gentlemen:
Metromedia International Group, Inc., a Delaware corporation (the
"COMPANY"), proposes to issue and sell to the several underwriters named in
Schedule I hereto (the "UNDERWRITERS") 3,000,000 shares of its ___% Cumulative
Convertible Preferred Stock, par value $1.00 per share (the "FIRM SHARES"). It
is understood that, subject to the conditions hereinafter stated, the 3,000,000
Firm Shares will be sold to the several Underwriters in connection with the
offering and sale of such Firm Shares. The Company also proposes to issue and
sell to the several Underwriters not more than an additional 450,000 shares of
its % Cumulative Convertible Preferred Stock, par value $1.00 per share (the
"ADDITIONAL SHARES"), if requested by the Underwriters as provided in Section 2
hereof. The Firm Shares and the Additional Shares are hereinafter collectively
referred to as the "SHARES." The shares of % Cumulative Convertible Preferred
Stock, par value $1.00 per share, of the Company, to be outstanding after giving
effect to the sales contemplated hereby are hereinafter referred to as the
"PREFERRED STOCK."
REGISTRATION STATEMENT AND PROSPECTUS. The Company has prepared and
filed with the Securities and Exchange Commission (the "COMMISSION") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"ACT"), a registration statement on Form S-3, including a prospectus, relating
to the Shares. The registration statement, as amended at the time it became
effective, including the information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Act, is hereinafter referred to as the "REGISTRATION STATEMENT;" and the
prospectus in the form first used to confirm sales of Shares is hereinafter
referred to as the "PROSPECTUS" (including, in the case of all references to the
Registration Statement or the Prospectus, documents incorporated therein by
reference). If the Company has filed or is required pursuant to the terms
hereof to file a registration statement pursuant to Rule 462(b) under the Act
registering additional shares of Preferred Stock (a "RULE 462(B) REGISTRATION
STATEMENT"), then, unless otherwise specified, any reference herein to the term
"Registration Statement" shall be deemed to include such Rule 462(b)
Registration Statement. The terms "SUPPLEMENT" and "AMENDMENT" or "AMEND" as
used in this Agreement with respect to the Registration Statement or the
Prospectus shall include all documents subsequently filed by the Company with
the Commission pursuant to the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"EXCHANGE ACT") that are incorporated by reference in the Prospectus.
<PAGE>
AGREEMENTS TO SELL AND PURCHASE AND LOCK-UP AGREEMENTS. On the basis
of the representations and warranties contained in this Agreement, and subject
to its terms and conditions, the Company agrees to issue and sell, and each
Underwriter agrees, severally and not jointly, to purchase from the Company at a
price per Share of $______ (the "PURCHASE PRICE") the aggregate number of Firm
Shares set forth opposite the name of each Underwriter in Schedule I hereto.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to
issue and sell the Additional Shares and the Underwriters shall have the
right to purchase, severally and not jointly, the Additional Shares from the
Company at the Purchase Price. Additional Shares may be purchased solely for
the purpose of covering over-allotments made in connection with the offering
of the Firm Shares. The Underwriters may exercise their right to purchase
Additional Shares in whole or in part from time to time by giving written
notice thereof to the Company within 30 days after the date of this
Agreement. If any Additional Shares are to be purchased, each Underwriter,
severally and not jointly, agrees to purchase from the Company the number of
Additional Shares (subject to such adjustments to eliminate fractional shares
as the Underwriters may determine) which bears the same proportion to the
total number of Additional Shares to be purchased from the Company as the
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule I bears to the total number of Firm Shares.
The Company hereby agrees not to (i) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, or otherwise transfer
or dispose of, directly or indirectly, any shares of Preferred Stock or any
shares of Common Stock, par value $1.00 per share, of the Company ("COMMON
STOCK"), or any securities convertible into or exercisable or exchangeable for
shares of Preferred Stock or shares of Common Stock or (ii) enter into any swap
or other arrangement that transfers all or a portion of the economic
consequences associated with the ownership of any shares of Preferred Stock or
shares of Common Stock (regardless of whether any of the transactions described
in clause (i) or (ii) is to be settled by the delivery of Preferred Stock,
Common Stock, or such other securities, in cash or otherwise), except to the
Underwriters pursuant to this Agreement, for a period of 180 days after the date
of the Prospectus without the prior written consent of Donaldson, Lufkin &
Jenrette Securities Corporation. Notwithstanding the foregoing, during such
period (i) the Company may grant stock options pursuant to the Company's
existing stock option plan and (ii) the Company may issue shares of Common Stock
upon the exercise of an option or warrant or the conversion of a security
outstanding on the date hereof. Except for registration statements to cover
shares of Common Stock owned by Renaissance Partners and the registration
statement on Form S-8 with respect to the Motion Picture Corporation of America
(the "MPCA") Stock Plan, the Company also agrees not to file any registration
statement with respect to any shares of Preferred Stock, Common Stock or any
securities convertible into or exercisable or exchangeable for shares of
Preferred Stock or shares of Common Stock for a period of 180 days after the
date of the Prospectus without the prior written consent of Donaldson, Lufkin &
Jenrette Securities Corporation. The Company shall, prior to or concurrently
with the execution of this Agreement, deliver an agreement executed by (i) each
of the directors and officers of the Company and (ii) each stockholder listed on
Annex I hereto to the effect that such person will not, during the period
commencing on the date such person signs such agreement and ending 180 days
after the date of the Prospectus, without the prior written consent of
Donaldson, Lufkin & Jenrette Corporation, (A) engage in any of the transactions
described in the first sentence of this paragraph or (B) make any demand for, or
exercise any right with respect to, the registration of any shares of Preferred
Stock, any shares of Common Stock or any securities convertible into or
exercisable or exchangeable for shares of Preferred Stock or shares of Common
Stock.
<PAGE>
TERMS OF PUBLIC OFFERING. The Company is advised by you that the
Underwriters propose (i) to make a public offering of their respective portions
of the Shares as soon after the execution and delivery of this Agreement as in
your judgment is advisable and (ii) initially to offer the Shares upon the terms
set forth in the Prospectus.
DELIVERY AND PAYMENT. Delivery to the Underwriters of and payment for
the Firm Shares shall be made at 9:00 A.M., New York City time, on September __
, 1997 (the "CLOSING DATE") at such place as you shall designate. The Closing
Date and the location of delivery of and payment for the Firm Shares may be
varied by agreement between you and the Company.
Delivery to the Underwriters of and payment for any Additional Shares
to be purchased by the Underwriters shall be made at such place as the
Underwriters shall designate at 9:00 A.M., New York City time, on the date
specified in the applicable exercise notice given by the Underwriters pursuant
to Section 2 (an "OPTION CLOSING DATE"). Any such Option Closing Date and the
location of delivery of and payment for such Additional Shares may be varied by
agreement between the Underwriters and the Company.
The Shares shall be evidenced by one or more fully-registered global
certificates registered in the name of Cede & Co. And, the preferred stock
shall be a book-entry-only security under the rules promulgated by the
Depository Trust Company.
AGREEMENTS OF THE COMPANY. The Company agrees with each of the
Underwriters:
To advise you promptly and, if requested by you, to confirm such
advice in writing, (i) of any request by the Commission for amendments to the
Registration Statement or amendments or supplements to the Prospectus or for
additional information, (ii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of the suspension
of qualification of the Shares for offering or sale in any jurisdiction, or the
initiation of any proceeding for such purposes, (iii) when any amendment to the
Registration Statement becomes effective, (iv) if the Company is required to
file a Rule 462(b) Registration Statement after the effectiveness of this
Agreement, when the Rule 462(b) Registration Statement has become effective and
(v) of the happening of any event during the period referred to in Section 5(d)
below which makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or which requires any additions to or changes
in the Registration Statement or the Prospectus in order to make the statements
therein not misleading. If at any time the Commission shall issue any stop
order suspending the effectiveness of the Registration Statement, the Company
will use its best efforts to obtain the withdrawal or lifting of such order at
the earliest possible time.
To furnish to you without charge four copies of a signed copy of the
Registration Statement as first filed with the Commission and of each amendment
to it, including all exhibits and documents incorporated therein by reference,
and to furnish to you such number of conformed copies of the Registration
Statement as so filed and of each amendment to it, without exhibits but
including documents incorporated therein by reference, as you may reasonably
request.
<PAGE>
To prepare the Prospectus, the form and substance of which shall be
satisfactory to you, and to file the Prospectus in such form with the Commission
within the applicable period specified in Rule 424(b) under the Act; during the
period specified in Section 5(d) below, not to file any further amendment to the
Registration Statement and not to make any amendment or supplement to the
Prospectus of which you shall not previously have been advised or to which you
shall reasonably object after being so advised; and, during such period, to
prepare and file with the Commission, promptly upon your reasonable request, any
amendment to the Registration Statement or amendment or supplement to the
Prospectus which may be necessary or advisable in connection with the
distribution of the Shares by you, and to use its best efforts to cause any such
amendment to the Registration Statement to become promptly effective.
Prior to 10:00 A.M., New York City time, on the first business day
after the date of this Agreement and from time to time thereafter for such
period as in the opinion of counsel for the Underwriters a prospectus is
required by law to be delivered in connection with sales by an Underwriter or a
dealer, to furnish in New York City to each Underwriter and any dealer as many
copies of the Prospectus (and of any amendment or supplement to the Prospectus)
as such Underwriter or dealer may reasonably request.
If during the period specified in Section 5(d), any event shall occur
or condition shall exist as a result of which, in the opinion of counsel for the
Underwriters and counsel for the Company, it becomes necessary to amend or
supplement the Prospectus in order to make the statements therein, in the light
of the circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if, in the opinion of counsel for the Underwriters and counsel
for the Company, it is necessary to amend or supplement the Prospectus to comply
with applicable law, forthwith to prepare and file with the Commission an
appropriate amendment or supplement to the Prospectus so that the statements in
the Prospectus, as so amended or supplemented, will not in the light of the
circumstances when it is so delivered, be misleading, or so that the Prospectus
will comply with applicable law, and to furnish to each Underwriter and to any
dealer as many copies thereof as such Underwriter or dealer may reasonably
request.
Prior to any public offering of the Shares, to cooperate with you and
counsel for the Underwriters in connection with the registration or
qualification of the Shares for offer and sale by the several Underwriters and
by dealers under the state securities or Blue Sky laws of such jurisdictions as
you may request, to continue such registration or qualification in effect so
long as required for distribution of the Shares and to file such consents to
service of process or other documents as may be necessary in order to effect
such registration or qualification; PROVIDED, HOWEVER, that the Company shall
not be required in connection therewith to qualify as a foreign corporation in
any jurisdiction in which it is not now so qualified or to take any action that
would subject it to general consent to service of process or taxation other than
as to matters and transactions relating to the Prospectus, the Registration
Statement, any preliminary prospectus or the offering or sale of the Shares, in
any jurisdiction in which it is not now so subject.
To mail and make generally available to its stockholders as soon as
practicable an earning statement covering the twelve-month period ending
September 30, 1998 that shall satisfy the provisions of Section 11(a) of the
Act, and to advise you in writing when such statement has been so made
available.
During the period of three years after the date of this Agreement, to
furnish to you as soon as available copies of all reports or other
communications furnished to the record holders of shares of Preferred Stock or
shares of Common Stock or furnished to or filed with the Commission or any
national securities exchange on which any class of securities of the Company is
listed and such other publicly available information concerning the Company and
its subsidiaries as you may reasonably request.
<PAGE>
Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this Agreement,
including: the fees, disbursements and expenses of the Company's counsel
and the Company's accountants in connection with the registration and
delivery of the Shares under the Act and all other fees and expenses in
connection with the preparation, printing, filing and distribution of the
Registration Statement (including financial statements and exhibits), any
preliminary prospectus, the Prospectus and all amendments and supplements to
any of the foregoing, including the mailing and delivering of copies thereof
to the Underwriters and dealers in the quantities specified herein, (ii) all
costs and expenses related to the transfer and delivery of the Shares to the
Underwriters, including any transfer or other taxes payable thereon, (iii)
all costs of printing or producing this Agreement and any other agreements or
documents in connection with the offering, purchase, sale or delivery of the
Shares, (iv) all expenses in connection with the registration or
qualification of the Shares for offer and sale under the securities or Blue
Sky laws of the several states and all costs of printing or producing any
Preliminary and Supplemental Blue Sky Memoranda in connection therewith
(including the filing fees and fees and disbursements of counsel for the
Underwriters in connection with such registration or qualification and
memoranda relating thereto), (v) the filing fees and disbursements of counsel
for the Underwriters in connection with the review and clearance of the
offering of the Shares by the National Association of Securities Dealers,
Inc., (vi) all fees and expenses in connection with the preparation and
filing of the registration statement on Form 8-A relating to the Preferred
Stock and all costs and expenses incident to the listing of the Shares and
the shares of Common Stock issuable upon conversion of the Shares on the
American Stock Exchange (the "AMEX") and the listing of the Shares on the
Pacific Stock Exchange (the "PSE"), (vii) the cost of printing certificates
representing the Shares, (viii) the costs and charges of any transfer agent,
registrar and/or depositary and (ix) all other costs and expenses incident to
the performance of the obligations of the Company hereunder for which
provision is not otherwise made in this Section.
To use its reasonable best efforts to list, subject to notice of
issuance, the Shares and the shares of Common Stock issuable upon conversion of
the Shares on the AMEX and the Shares on the PSE and to use its reasonable best
efforts to maintain the listing of the Shares and the shares of Common Stock
issuable upon conversion of the Shares on the AMEX and the Shares on the PSE for
a period of three years after the date of this Agreement.
To use its reasonable best efforts to do and perform all things
required or necessary to be done and performed under this Agreement by the
Company prior to the Closing Date or any Option Closing Date, as the case may
be, and to satisfy all conditions precedent to the delivery of the Shares.
If the Registration Statement at the time of the effectiveness of this
Agreement does not cover all of the Shares, to file a Rule 462(b) Registration
Statement with the Commission registering the Shares not so covered in
compliance with Rule 462(b) by 10:00 P.M., New York City time, on the date of
this Agreement and to pay to the Commission the filing fee for such Rule 462(b)
Registration Statement at the time of the filing thereof or to give irrevocable
instructions for the payment of such fee pursuant to Rule 111(b) under the Act.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to each Underwriter that:
The Registration Statement has become effective (other than any Rule
462(b) Registration Statement to be filed by the Company after the effectiveness
of this Agreement); any Rule 462(b) Registration Statement filed after the
effectiveness of this Agreement will become effective no later than 10:00 P.M.,
New York City time, on the date of this Agreement; and no stop order suspending
the effectiveness of the Registration Statement is in effect, and no proceedings
for such purpose are pending before or threatened by the Commission.
<PAGE>
The Registration Statement (other than any Rule 462(b) Registration
Statement to be filed by the Company after the effectiveness of this Agreement),
when it became effective, did not contain and, as amended through the date
hereof, if applicable, will not contain any 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; the Registration Statement (other
than any Rule 462(b) Registration Statement to be filed by the Company after the
effectiveness of this Agreement) and the Prospectus comply and, as amended or
supplemented through the date hereof, if applicable, will comply in all material
respects with the Act; if the Company is required to file a Rule 462(b)
Registration Statement after the effectiveness of this Agreement, such Rule
462(b) Registration Statement and any amendments thereto, when they become
effective (A) will not contain any 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 and (B) will comply in all material respects
with the Act and the Prospectus does not contain and, as amended or
supplemented through the date hereof, if applicable, 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 paragraph do not apply to statements or omissions in the Registration
Statement or the Prospectus based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you expressly
for use therein.
Each document, if any, filed or to be filed pursuant to the Exchange
Act and incorporated by reference in the Prospectus complied or will comply when
so filed in all material respects with the Exchange Act.
Each preliminary prospectus filed as part of the registration
statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Act, complied when so filed in all material
respects with the Act, and did not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that the representations and warranties
set forth in this paragraph do not apply to statements or omissions in any
preliminary prospectus based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you expressly
for use therein.
Each of the Company and its subsidiaries and, to the best of the
Company's knowledge, each MITI Minority Venture (as defined below), has been
duly incorporated, is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation and has the corporate power and
authority to carry on its business as described in the Prospectus and to own,
lease and operate its properties, and each is duly qualified and is in good
standing as a foreign corporation authorized to do business in each jurisdiction
in which the nature of its business or its ownership or leasing of property
requires such qualification, except where the failure to be so qualified could
not be reasonably expected to have a material adverse effect on the business,
prospects, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole.
All the outstanding shares of capital stock of the Company have been
duly authorized and validly issued and are fully paid, nonassessable and not
subject to any preemptive or similar rights; and the Shares have been duly
authorized and, when issued and delivered to the Underwriters against payment
therefor as provided by this Agreement, will be validly issued, fully paid and
nonassessable, and the issuance of such Shares will not be subject to any
preemptive or similar rights; and the shares of Common Stock issuable upon
conversion of the Shares have been duly authorized and reserved for issuance
upon such conversion and, when issued and delivered upon such conversion in
accordance with the terms of the Shares, will be validly issued, fully paid and
nonassessable and not subject to any preemptive or similar rights.
<PAGE>
All of the outstanding shares of capital stock of, or other ownership
interests in, each subsidiary have been duly and validly authorized and issued
and are owned, directly or through subsidiaries, by the Company. All of the
ownership interests in each corporation, partnership, joint venture or other
legal entity of which Metromedia International Telecommunications, Inc., a
Delaware corporation ("MITI"), owns, directly or indirectly, less than 50% of
the stock or other equity interests the holders of which are generally entitled
to vote for the election of the board of directors or similar governing body of
such corporation, partnership, joint venture or other legal entity (each, a
"MITI MINORITY VENTURE" and, collectively, the "MITI MINORITY VENTURES") have
been duly and validly authorized and issued and are owned, directly or through
subsidiaries, by MITI in the percentages described in the Prospectus under the
heading "Business-Communications Group-Communications Group Overview-Markets".
All such ownership interests are (to the extent such concept is applicable)
fully paid and nonassessable, and are owned free and clear of any security
interest, mortgage, pledge, claim, lien or encumbrance (each, a "LIEN"), except
for Liens arising on or prior to the date hereof, under (i) the Credit Agreement
dated as of November 26, 1996 between Snapper, Inc. and AmSouth Bank of Alabama,
as amended, (the "EXISTING CREDIT FACILITY"). There are no outstanding
subscriptions, rights, warrants, options, calls, convertible securities,
commitments of sale or Liens related to or entitling any person to purchase or
otherwise to acquire any shares of the capital stock of, or other ownership
interest in, any subsidiary or any MITI Minority Venture, except for, on the
date hereof, Liens pursuant to the Existing Credit Facilities.
There are no outstanding subscriptions, rights, warrants, options,
calls, convertible securities, commitments of sale or liens granted or issued by
the Company or any of its subsidiaries or, to the best of the Company's
knowledge, any MITI Minority Venture relating to or entitling any person to
purchase or otherwise to acquire any shares of the capital stock of the Company
or any of its subsidiaries or any MITI Minority Venture, except as otherwise
disclosed in the Registration Statement.
The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.
Neither the Company, any of its subsidiaries nor any MITI Minority
Venture is in violation of its respective charter, by-laws or other constitutive
documents or in default in the performance of any obligation, agreement,
covenant or condition contained in any indenture, loan agreement, mortgage,
lease or other agreement or instrument that is material to the Company and its
subsidiaries, taken as a whole, to which the Company, any of its subsidiaries or
any MITI Minority Venture is a party or by which the Company or any of its
subsidiaries or their respective property is bound.
This Agreement has been duly authorized, executed and delivered by the
Company.
The execution, delivery and performance of this Agreement by the
Company, the compliance by the Company with all the provisions hereof and the
consummation of the transactions contemplated hereby will not (i) require any
consent, approval, authorization or other order of, or qualification with, any
court or governmental body or agency (except such as may be required under the
securities or Blue Sky laws of the various states), (ii) conflict with or
constitute a breach of any of the terms or provisions of, or a default under,
the charter or by-laws of the Company or any of its subsidiaries or, to the best
of the Company's knowledge, any MITI Minority Venture or any indenture, loan
agreement, mortgage, lease or other agreement or instrument that is material to
the Company, its subsidiaries and the MITI Minority Ventures, taken as a whole,
to which the Company, any of its subsidiaries or any MITI Minority Venture is a
party or by which the Company, any of its subsidiaries or any MITI Minority
Venture or their respective property is bound, (iii) violate or conflict with
any applicable law or any rule, regulation, judgment, order or decree of any
court or any governmental body or agency having jurisdiction over the Company,
any of its subsidiaries, any MITI Minority Venture or their respective property
or (iv) result in the suspension, termination or revocation of any Authorization
(as defined below) of the Company or any of its subsidiaries or any other
impairment of the rights of the holder of any such Authorization.
<PAGE>
There are no legal or governmental proceedings pending or, to the
Company's knowledge, threatened to which the Company or any of its subsidiaries
or, to the best of the Company's knowledge, any MITI Minority Venture, is a
party or to which any of their respective property is subject that are required
to be described in the Registration Statement or the Prospectus and are not so
described; nor are there any statutes, regulations, contracts or other documents
that are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement that are not
so described or filed as required.
Neither the Company, any of its subsidiaries nor any MITI Minority
Venture has violated any foreign, federal, state or local law or regulation
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("ENVIRONMENTAL LAWS") or any provisions of the Employee Retirement Income
Security Act of 1974, as amended, or the rules and regulations promulgated
thereunder, except for such violations which, singly or in the aggregate, could
not reasonably be expected to have a material adverse effect on the business,
prospects, financial condition or results of operation of the Company and its
subsidiaries, taken as a whole.
There are no costs or liabilities associated with Environmental Laws
(including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with Environmental Laws or any
Authorization, any related constraints on operating activities and any potential
liabilities to third parties) which could, singly or in the aggregate, be
reasonably expected to have a material adverse effect on the business,
prospects, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole.
KPMG Peat Marwick LLP are independent public accountants with respect
to the Company and its subsidiaries as required by the Act.
The PRO FORMA statements of the Company and its subsidiaries and the
related notes thereto set forth in the Registration Statement and the Prospectus
(and any supplement or amendment thereto) (i) have been prepared on a basis
consistent with the historical financial statements of the Company and its
subsidiaries, (ii) give effect to the assumptions used in the preparation
thereof on a reasonable basis and (iii) in good faith and present fairly the
historical and proposed transactions contemplated therein. Such PRO FORMA
financial statements have been prepared in accordance with the applicable
requirements of Rule 11-02 of Regulation S-X promulgated by the Commission. The
other PRO FORMA financial and statistical information and data set forth in the
Registration Statement and the Prospectus (and any supplement or amendment
thereto) are, in all material respects, accurately presented and prepared on a
basis consistent with the PRO FORMA financial statements.
The Company and each of its subsidiaries, and to the best of the
Company's knowledge, each MITI Minority Venture maintains a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (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
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
<PAGE>
The consolidated financial statements included in the Registration
Statement and the Prospectus (and any amendment or supplement thereto), together
with related schedules and notes, present fairly the consolidated financial
position, results of operations and changes in financial position of the Company
and its subsidiaries on the basis stated therein at the respective dates or for
the respective periods to which they apply; such statements and related
schedules and notes have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods involved,
except as disclosed therein; the supporting schedules, if any, included or
incorporated in the Registration Statement present fairly, in accordance with
generally accepted accounting principles, the information required to be stated
therein; and the other financial and statistical information and data set forth
or incorporated in the Registration Statement and the Prospectus (and any
amendment or supplement thereto) are, in all material respects, accurately
presented and prepared on a basis consistent with such financial statements and
the books and records of the Company.
Since the respective dates as of which information is given in the
Prospectus other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there has not occurred any material adverse change or any development involving
a prospective material adverse change in the condition, financial or otherwise,
or the earnings, business, management or operations of the Company and its
subsidiaries, taken as a whole, (ii) there has not been any material adverse
change or any development involving a prospective material adverse change in the
capital stock or in the long-term debt of the Company or any of its subsidiaries
and (iii) neither the Company nor any of its subsidiaries nor, to the best of
the Company's knowledge, any MITI Minority Venture has incurred any material
liability or obligation, direct or contingent.
All tax returns required to be filed by the Company, any of the
subsidiaries or, to the best of the Company's knowledge, any MITI Minority
Venture in any jurisdiction have been filed, other than those filings being
contested in good faith and other than those filings of which the failure to
file could not, singly or in the aggregate, be reasonably expected to have a
material adverse effect on the business, prospects, financial condition or
results of operations of the Company and its subsidiaries, taken as a whole, and
all material taxes, including withholding taxes, penalties and interest,
assessments, fees and other charges due or claimed to be due from such entities
have been paid, other than those being contested in good faith and for which
adequate reserves have been provided or those currently payable without penalty
or interest.
Each of the Company and its subsidiaries has and, to the best of the
Company's knowledge, each MITI Minority Venture has such permits, licenses,
consents, exemptions, franchises, authorizations and other approvals (each, an
"AUTHORIZATION") of, and has made all filings with and notices to, all
governmental or regulatory authorities and self-regulatory organizations and all
courts and other tribunals, including, without limitation, under any applicable
Environmental Laws, as are necessary to own, lease, license and operate its
respective properties and to conduct its business, except where the failure to
have any such Authorization or to make any such filing or notice could not,
singly or in the aggregate, be reasonably expected to have a material adverse
effect on the business, prospects, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole. To the best of the
Company's knowledge, each such Authorization is valid and in full force and
effect and each of the Company, its subsidiaries and each MITI Minority Venture
is in compliance with all the terms and conditions thereof and with the rules
and regulations of the authorities and governing bodies having jurisdiction with
respect thereto; and no event has occurred (including, without limitation, the
receipt of any notice from any authority or governing body) which allows or,
after notice or lapse of time or both, would allow, revocation, suspension or
termination of any such Authorization or results or, after notice or lapse of
time or both, would result in any other impairment of the rights of the holder
of any such Authorization; and such Authorizations contain no restrictions that
are materially burdensome to the Company on any of its subsidiaries or any MITI
Minority Venture; except where such failure to be valid and in full force and
effect or to be in compliance, the occurrence of any such event or the presence
of any such restriction could not, singly or in the aggregate, be reasonably
expected to have a material adverse effect on the business, prospects, financial
condition or results of operations of the Company, its subsidiaries, taken as a
whole.
<PAGE>
The Company is not and, after giving effect to the offering and sale
of the Shares and the application of the proceeds thereof as described in the
Prospectus, will not be, an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended.
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 Act with respect to any securities of
the Company or to require the Company to include such securities with the Shares
registered pursuant to the Registration Statement, except for registration
statements to cover shares of Common Stock owned by Renaissance Partners and the
registration statement on Form S-8 with respect to the MPCA Stock Plan.
Each certificate signed by any officer of the Company and delivered to
the Underwriters or counsel for the Underwriters pursuant to the terms hereof
shall be deemed to be a representation and warranty by the Company to each
Underwriter as to the matters covered thereby.
Neither the Company nor any of the subsidiaries has taken, directly or
indirectly, any action designed to cause or to result in, or that has
constituted or which could reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares in violation of law.
The Company and each subsidiary and, to the best of the Company's
knowledge, each of the MITI Minority Ventures, maintains insurance covering
their properties, operations, personnel and businesses. Such insurance insures
against such losses and risks as are reasonably adequate in accordance with
customary industry practice to protect the Company and its subsidiaries and
their businesses.
INDEMNIFICATION.
The Company agrees to indemnify and hold harmless each Underwriter,
its directors, its officers and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act from and against any and all losses, claims, damages, liabilities
and judgments (including, without limitation, any legal or other expenses
incurred in connection with investigating or defending any matter, including any
action, that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (or any amendment
thereto), the Prospectus (or any amendment or supplement thereto) or any
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or judgments are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information relating
to any Underwriter furnished in writing to the Company by such Underwriter
through you expressly for use therein. The foregoing indemnity agreement with
respect to any untrue statement or omission from a preliminary prospectus shall
not inure to the benefit of the Underwriter from whom the person asserting any
such losses, liabilities, claims, damages or expenses purchased Shares, or any
person controlling such Underwriter, if a copy of the Prospectus (as then
amended or supplemented, if the Company shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of the Underwriters
to such person, if such is required by law, at or prior to the written
confirmation of the sale of such Shares to such person and the untrue statement
contained in or omission from such preliminary prospectus was corrected in the
Prospectus (or the Prospectus as amended or supplemented).
Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, to the same extent
as the foregoing indemnity from the Company to such Underwriter but only with
reference to information relating to such Underwriter furnished in writing to
the Company by such Underwriter through you expressly for use in the
Registration Statement (or any amendment thereto), the Prospectus (or any
amendment or supplement thereto) or any preliminary prospectus.
<PAGE>
In case any action shall be commenced involving any person in respect
of which indemnity may be sought pursuant to Section 7(a) or Section 7(b) (the
"INDEMNIFIED PARTY"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 7(a) and Section 7(b), the Underwriter shall not be required to
assume the defense of such action pursuant to this Section 7(c), but may employ
separate counsel and participate in the defense thereof, but the fees and
expenses of such counsel, except as provided below, shall be at the expense of
such Underwriter). Any indemnified party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of the indemnified
party unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such action (including any impleaded parties) include both the indemnified
party and the indemnifying party, and the indemnified party shall have been
reasonably advised by such counsel that a conflict may exist between the
indemnified party and the indemnifying party (in which case the indemnifying
party shall not have the right to assume the defense of such action on behalf of
the indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified parties
and all such fees and expenses shall be reimbursed as they are incurred. Such
firm shall be designated in writing by Donaldson, Lufkin & Jenrette Securities
Corporation, in the case of parties indemnified pursuant to Section 7(a), and by
the Company, in the case of parties indemnified pursuant to Section 7(b). The
indemnifying party shall indemnify and hold harmless the indemnified party from
and against any and all losses, claims, damages, liabilities and judgments by
reason of any settlement of any action (i) effected with its written consent or
(ii) effected without its written consent if the settlement is entered into more
than thirty business days after the indemnifying party shall have received a
request from the indemnified party for reimbursement for the fees and expenses
of counsel (in any case where such fees and expenses are at the expense of the
indemnifying party) and, prior to the date of such settlement, the indemnifying
party shall have failed to comply with such reimbursement request. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened action in respect of which
the indemnified party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the indemnified
party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability on claims that
are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.
<PAGE>
To the extent the indemnification provided for in this Section 7 is
unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
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, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Shares or (ii) if the allocation provided by clause 7(d)(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 7(d)(i) above but also the
relative fault of the Company on the one hand and the Underwriters on the other
hand in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other hand shall be deemed to be in the
same proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company, and the total underwriting discounts and
commissions received by the Underwriters, bear to the total price to the public
of the Shares, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault of the Company on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether 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 Company or the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriters agree that it would not
be just and equitable if contribution pursuant to this Section 7(d) were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or judgments referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
indemnified party in connection with investigating or defending any matter,
including any action, that could have given rise to such losses, claims,
damages, liabilities or judgments. Notwithstanding the provisions of this
Section 7, no Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Shares underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 7(d) are several in proportion to the
respective number of Shares purchased by each of the Underwriters hereunder and
not joint.
The remedies provided for in this Section 7 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations of
the Underwriters to purchase the Firm Shares under this Agreement are subject to
the satisfaction of each of the following conditions:
All the representations and warranties of the Company contained in
this Agreement shall be true and correct in all material respects on the date of
this Agreement and shall be true and correct in all material respects (except
that such phrase "in all material respects" shall be disregarded to the extent
that any such representation and warranty is qualified by "material," "material
adverse effect" or any similar terms or by any phrase using any of such terms)
on the Closing Date with the same force and effect as if made on and as of the
Closing Date.
<PAGE>
If the Company is required to file a Rule 462(b) Registration
Statement after the effectiveness of this Agreement, such Rule 462(b)
Registration Statement shall have become effective by 10:00 P.M., New York City
time, on the date of this Agreement; and no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been commenced or shall be pending
before or contemplated by the Commission.
You shall have received on the Closing Date a certificate dated the
Closing Date, signed by a Senior Vice President of the Company and the Chief
Financial Officer of the Company, in their capacities as such officers of the
Company, confirming the matters set forth in Sections 6(t), 8(a) and 8(b) and
that the Company has complied with all of the agreements and satisfied all of
the conditions herein contained and required to be complied with or satisfied by
the Company on or prior to the Closing Date.
Since the respective dates as of which information is given in the
Prospectus other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there shall not have occurred any change or any development involving a
prospective change in the condition, financial or otherwise, or the earnings,
business, management or operations of the Company and its subsidiaries, taken as
a whole, (ii) there shall not have been any change or any development involving
a prospective change in the capital stock or in the long-term debt of the
Company or any of its subsidiaries, and (iii) neither the Company nor any of its
subsidiaries shall have incurred any liability or obligation, direct or
contingent, the effect of which, in any such case described in clause 8(d)(i),
8(d)(ii) or 8(d)(iii), in your judgment, is material and adverse and, in your
judgment, makes it impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus.
You shall have received on the Closing Date an opinion (satisfactory
to you and counsel for the Underwriters), dated the Closing Date, of Paul,
Weiss, Rifkind, Wharton & Garrison, counsel for the Company, to the effect that:
The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware.
The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Registration Statement and to enter into and perform its obligations under this
Agreement.
Based solely on a certificate of the Company's transfer agent and
without giving effect to the transactions contemplated by this Agreement, no
shares of Preferred Stock are issued and outstanding as of the Closing Date and
no other shares of capital stock of the Company are issued or outstanding on the
Closing Date date, other than ___________ shares of Common Stock. The Shares
have been duly authorized for issuance and sale to the Underwriters pursuant to
this Agreement and, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth herein, will be validly
issued and fully paid and nonassessable.
The issuance of the Shares is not subject to preemptive or other
similar rights arising by operation of law, under the charter or by-laws of the
Company or under any agreement listed or set forth in the Registration
Statement.
MITI has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware and has
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Registration Statement.
This Agreement has been duly authorized, executed and delivered by the
Company.
<PAGE>
The Registration Statement has been declared effective under the
Securities Act; and, to such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued under the Act or
proceedings therefor initiated or threatened by the Commission.
The Registration Statement, including any information included in
accordance with Rule 430A promulgated under the Act (the "430A Information") and
the Prospectus, as of their respective effective or issue dates (other than the
financial statements and supporting schedules included therein, as to which such
counsel need express no opinion) complied as to form in all material respects
with the requirements of the Act and the Rules and Regulations. In passing upon
the compliance as to form of the Registration Statement and Prospectus, such
counsel may assume that the statements made in the Registration Statement and
the Prospectus are complete and correct.
All descriptions in the Prospectus of contracts and other documents to
which the Company or any of its subsidiaries is a party are in all material
respects accurate and fair summaries thereof. To such counsel's knowledge,
there are no franchises, contracts, indentures, mortgages, loan agreements,
notes, leases or other instruments required to be described or referred to in
the Registration Statement or to be filed as exhibits thereto other than those
described or referred to therein or filed as exhibits thereto and the
descriptions thereof or references thereto are correct in all material respects.
No authorization, approval, consent or order of any court or
governmental authority or agency under the laws of the Federal government of the
United States or the State of New York or under the General Corporation Law of
the State of Delaware (other than under the Act and the Rules and Regulations,
which have been obtained or made, or as may be required under the securities or
Blue Sky laws of the various states or foreign jurisdictions or the National
Association of Securities Dealers, Inc., as to each of which such counsel need
express no opinion) is required in connection with the due authorization,
execution and delivery of this Agreement or for the offering, issuance or sale
of the Shares to the Underwriters.
The execution, delivery and performance of this Agreement and
compliance by the Company with its obligations under this Agreement will not, to
such counsel's knowledge, conflict with or constitute a breach of, or default
under or result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of its subsidiaries pursuant
to any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or any other agreement or instrument listed as an exhibit to the
Registration Statement and to which the Company or any of its subsidiaries is a
party or by which it or any of them may be bound or to which any of the property
or assets of the Company or any of its subsidiaries is subject (except for such
conflicts, breaches, defaults or liens, charges or encumbrances that would not
result in a material adverse effect on the business, prospects, financial
condition or results of operations of the Company and its subsidiaries, taken as
a whole), nor will such action result in any violation of the provisions of the
charter or by-laws of the Company or any of its subsidiaries, or any applicable
law, statute, rule or regulation of the Federal government of the United States
or the State of New York or under the General Corporation Law of the State of
Delaware, or, to such counsel's knowledge, any judgment, order, writ or decree
of any government, government instrumentality or court having jurisdiction over
the Company or any of its subsidiaries or any of their respective properties,
assets or operations except for such violations of law, statute, rule,
regulation, judgment, order, writ or decree that would not result in a material
adverse effect on the business, prospects, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole.
<PAGE>
The Company is not an "investment company" or an entity "controlled"
by an "investment company" as such terms are defined in the Investment Company
Act of 1940, as amended.
To such counsel's knowledge, there are no persons with registration or
other similar rights to have any securities registered pursuant to the
Registration Statement.
In connection with the preparation of the Registration Statement and
the Prospectus, such counsel shall state that they have participated in
conferences with certain officers and other representatives of the Company and
the independent public accountants for the Company, at which the contents of the
Registration Statement and the Prospectus and related matters were discussed. On
the basis of such participation and review (relying as to materiality to a large
extent upon the opinions of officers and other representatives of the Company),
but without independent verification by such counsel of, and without assuming
any responsibility for, the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus or any amendments or
supplements thereto, and except for information pertaining to the Company's
Communications Group, as to which such counsel need make no statement, nothing
has come to such counsel's attention that would lead them to believe that the
Registration Statement, including the Rule 430A Information (except for
financial statements and schedules and other financial or statistical data
included or incorporated by reference therein or omitted therefrom, as to which
such counsel need make no statement), at the time the Registration Statement
became effective, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus, or any amendment or
supplement thereto (except for financial statements and schedules and other
financial or statistical data included or incorporated by reference therein or
omitted therefrom, as to which such counsel need make no statement), on the date
the Prospectus was issued or on the Closing Date, included or includes an untrue
statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
You shall have received on the Closing Date an opinion (satisfactory
to you and counsel for the Underwriters), dated the Closing Date, of Arnold L.
Wadler, Executive Vice President, General Counsel and Secretary of the Company,
to the effect that:
Each of the Company and MITI is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership or lease of property or the conduct of its business requires such
qualification and where the failure to so qualify would have a material adverse
effect on the business, prospects, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole.
All of the issued and outstanding shares of capital stock of each
subsidiary have been duly and validly authorized and issued, the shares of
capital stock of each subsidiary are owned directly by the Company, and the
shares of capital stock of each subsidiary are fully paid and nonassessable, and
are owned free and clear of any Liens, except for Liens existing on the Closing
Date under the Existing Credit Facilities.
The execution, delivery and performance of this Agreement and
compliance by the Company of its obligations under this Agreement will not,
whether with or without the giving of notice or lapse of time or both, conflict
with or constitute a breach of, or default under (a) any of the respective
organizational documents of any of the MITI Joint Ventures, (b) to the best of
his knowledge, any statute, rule or regulation to which any of the MITI Joint
Ventures is bound or to which any of the properties of any of the MITI Joint
Ventures is subject or (c) to the best of his knowledge, any order of any court
or governmental authority or agency binding upon any of the MITI Joint Ventures,
except for conflicts, breaches or defaults in each of the cases described in
clauses (b) and (c) which would not reasonably be expected to have a material
adverse effect on the business, prospects, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole.
<PAGE>
To the best of his knowledge, none of the Company or any of its
subsidiaries is in default in any respect in the performance of any material
contract, loan agreement, mortgage, deed of trust, material lease or other
material written contract or agreement or of any material order, award or decree
of any court, arbitrator or governmental or administrative body binding upon or
affecting it or by which any of its material properties or assets is bound or
affected, except for defaults which would not reasonably be expected to have a
material adverse effect on the business, prospects, financial condition or
results of operations of the Company and its subsidiaries, taken as a whole.
To the best of his knowledge, there are no legal or governmental
actions, suits or proceedings pending or threatened against the Company or any
of its subsidiaries that are required to be described in the Prospectus that are
not described as required.
All descriptions in the Prospectus of contracts and other documents to
which the Company or any of its subsidiaries is a party are in all material
respects accurate and fair summaries thereof; with respect to the Company's
Communications Group, to his knowledge, there are no franchises, contracts,
indentures, mortgages, loan agreements, notes, leases or other instruments
required to be described or referred to in the Registration Statement to be
filed as exhibits thereto other than those described or referred to therein or
filed as exhibits thereto and the descriptions thereof or references thereto are
correct in all material respects.
You shall have received on the Closing Date an opinion, dated the
Closing Date, of Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the
Underwriters, as to the matters referred to in Sections 8(e)(iii) (second
sentence only), 8(e)(vi), 8(e)(ix) (first sentence only and then only with
respect to the statements under the caption "Description of Capital Stock" and
"Underwriting") and 8(e)(xiv). In giving such opinions with respect to the
matters covered by Section 8(e)(xiv) Paul, Weiss, Rifkind, Wharton & Garrison
and Skadden, Arps, Slate, Meagher & Flom LLP may state that their opinion and
belief are based upon their participation in the preparation of the Registration
Statement and Prospectus and documents incorporated therein by reference and
review and discussion of the contents thereof (including documents incorporated
therein by reference), but are without independent check or verification except
as specified.
You shall have received letters on and as of the date hereof as well
as on and as of the Closing Date (in the latter case constituting an affirmation
of the statements set forth in the former), in form and substance satisfactory
to you, from KPMG Peat Marwick LLP, independent public accountants, with respect
to the financial statements and certain financial information contained in or
incorporated by reference into the Registration Statement and the Prospectus.
<PAGE>
The Company shall have delivered to you the agreements specified in
Section 2 hereof which agreements shall be in full force and effect on the
Closing Date.
At the Closing Date, the Shares and shares of Common Stock issuable
upon conversion of the Shares shall have been approved for listing, subject to
notice of issuance, on the AMEX and the Shares shall have been approved for
listing, subject to notice of issuance, on the PSE.
The Company shall not have failed in any material respect on or prior
to the Closing Date to perform or comply with any of the agreements herein
contained and required to be performed or complied with by the Company on or
prior to the Closing Date. The several obligations of the Underwriters to
purchase any Additional Shares hereunder are subject to the delivery to the
Underwriters on the applicable Option Closing Date of such documents as they may
reasonably request with respect to the good standing of the Company, the due
authorization and issuance of such Additional Shares and other matters related
to the issuance of such Additional Shares.
No action shall have been taken and no statute, rule, regulation or
order shall have been enacted, adopted or issued by any governmental agency
which would, as of the Closing Date, prevent the issuance of the Shares; no
injunction, restraining order or order of any nature by a Federal or state court
of competent jurisdiction shall have been issued as of the Closing Date which
would prevent the issuance of the Shares; and on the Closing Date, no action,
suit or proceeding shall be pending against, or, to the knowledge of the
Company, threatened against the Company, any of its subsidiaries or any of the
MITI Minority Ventures before any court or arbitrator or any governmental body,
agency or official which, if adversely determined, would interfere with or
adversely affect the issuance of the Shares or could, singly or in the
aggregate, reasonably be expected to have a material adverse effect on the
business, prospects, financial condition or results of operations of the Company
and its subsidiaries, taken as a whole.
EFFECTIVENESS OF AGREEMENT AND TERMINATION. This Agreement shall
become effective upon the later of (i) the execution and delivery of this
Agreement by the parties hereto, (ii) the effectiveness of the Registration
Statement, and (iii) if a post-effective amendment is required to be filed
pursuant to Rule 430A under the Act, the effectiveness of such post-effective
amendment.
This Agreement may be terminated at any time on or prior to the
Closing Date by you by written notice to the Company if any of the following has
occurred: (i) any outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic conditions or in the
financial markets of the United States or elsewhere that, in Donaldson, Lufkin &
Jenrette Securities Corporation's judgment on behalf of the Underwriters, is
material and adverse and, in Donaldson, Lufkin & Jenrette Securities
Corporation's judgment on behalf of the Underwriters, makes it impracticable or
inadvisable to market the Shares or to enforce contracts for the sale of the
Shares on the terms and in the manner contemplated in the Prospectus, (ii) any
suspension or material limitation of trading generally in securities or other
instruments on the AMEX, or any setting of minimum prices for trading on such
exchange, the suspension of trading of any securities of the Company on any
exchange or in the over-the-counter market, (iii) the enactment, publication,
decree or other promulgation of any of the United States Federal or state
statute, regulation, rule or order of any court or other governmental authority
which in Donaldson, Lufkin & Jenrette Securities Corporation's judgment on
behalf of the Underwriters materially and adversely affects, or could materially
and adversely affect, singly or in the aggregate, the business, prospects,
financial condition or results of operations of the Company and its
subsidiaries, (iv) any declaration of a banking moratorium by any Federal or New
York State authorities, (v) the taking of any action by any Federal, state or
local government or agency in respect of its monetary or fiscal affairs which in
Donaldson, Lufkin & Jenrette Securities Corporation's judgment on behalf of the
Underwriters has a material adverse effect on the financial markets in the
United States and would, in your judgment, make it impracticable or inadvisable
to market the Shares or to enforce contracts for the sale of the Shares, or (vi)
subsequent to the date the Registration Statement is declared effective or the
date of this Agreement, any material adverse change on the business, prospects,
financial condition or results of operations of the Company occurs which, in
Donaldson, Lufkin & Jenrette Securities Corporation's judgment on behalf of the
Underwriters, makes it impracticable or inadvisable to market the Shares or to
enforce contracts for the sale of the Shares.
<PAGE>
If on the Closing Date or on any Option Closing Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase the
Firm Shares or Additional Shares, as the case may be, which it or they have
agreed to purchase hereunder on such date and the aggregate amount of Firm
Shares or Additional Shares, as the case may be, which such defaulting
Underwriter or Underwriters, as the case may be, agreed but failed or refused to
purchase is not more than one-tenth of the total number of Shares to be
purchased on such date by all Underwriters, each non-defaulting Underwriter
shall be obligated severally, in the proportion which the number of Firm Shares
set forth opposite its name in Schedule I bears to the total number of Firm
Shares which all the non-defaulting Underwriters, as the case may be, have
agreed to purchase, or in such other proportion as you may specify, to purchase
the Firm Shares or Additional Shares, as the case may be, which such defaulting
Underwriter or Underwriters, as the case may be, agreed but failed or refused to
purchase on such date; PROVIDED that in no event shall the number of Firm Shares
or Additional Shares, as the case may be, which any Underwriter has agreed to
purchase pursuant to Section 2 hereof be increased pursuant to this Section 9 by
an amount in excess of one-ninth of such number of Firm Shares or Additional
Shares, as the case may be, without the written consent of such Underwriter. If
on the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase the Firm Shares and the aggregate number of Firm Shares with respect to
which such default occurs is more than one-tenth of the aggregate number of such
Firm Shares to be purchased on such date by all Underwriters and arrangements
satisfactory to you and the Company for the purchase of such Firm Shares are
not made within 48 hours after such default, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter and the Company
except as provided in this Section 9. In any such case which does not result in
termination of this Agreement, either you or the Company shall have the right to
postpone the Closing Date or the Option Date, as the case may be, but in no
event for longer than seven days, in order that the required changes, if any, in
the Registration Statement and the Prospectus or any other documents or
arrangements may be effected. If, on an Option Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Additional Shares and the
aggregate number of Additional Shares with respect to which such default occurs
is more than one-tenth of the aggregate number of Additional Shares to be
purchased on such date, the non-defaulting Underwriters shall have the option to
(i) terminate their obligation hereunder to purchase such Additional Shares or
(ii) purchase not less than the number of Additional Shares that such
non-defaulting Underwriters would have been obligated to purchase on such date
in the absence of such default. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
any such Underwriter under this Agreement.
MISCELLANEOUS. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to the Company, to Metromedia
International Group, Inc., One Meadowlands Plaza, East Rutherford, New Jersey
07073-2137, with a copy to (which shall not constitute notice) Paul, Weiss,
Rifkind, Wharton & Garrison, 1285 Avenue of the Americas, New York, New York
10019-6064, Attention: James M. Dubin and (ii) if to any Underwriter, c/o
Donaldson, Lufkin & Jenrette Securities Corporation, 277 Park Avenue, New York,
New York 10172, Attention: Syndicate Department, or in any case to such other
address as the person to be notified may have requested in writing.
The indemnity and contribution provisions and the other agreements,
representations, warranties and other statements of the Company and the several
Underwriters set forth in or made pursuant to this Agreement shall remain
operative and in full force and effect, and will survive delivery of and payment
for the Shares, regardless of (i) any investigation, or statement as to the
results thereof, made by or on behalf of any Underwriter, the officers or
directors of the Company or any person controlling the Company, (ii) acceptance
of the Shares and payment for them hereunder, and (iii) termination of this
Agreement.
If this Agreement shall be terminated by the Underwriters pursuant to
clause (vi) of the second paragraph of Section 9 or because the failure or
refusal on the part of the Company to comply with the terms or to fulfill any of
the conditions of this Agreement, the Company agrees to reimburse the several
Underwriters for all reasonable and documented out-of-pocket expenses (including
the reasonable fees and disbursements of counsel) incurred by them.
Notwithstanding any termination of this Agreement, the Company shall be liable
for all expenses which it has agreed to pay pursuant to Section 5(i) hereof.
The Company also agrees to reimburse the several Underwriters for any and all
fees and expenses (including, without limitation, the fees disbursements of
counsel) incurred by them in connection with enforcing their rights hereunder
(including, without limitation, pursuant to Section 7 hereof).
<PAGE>
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the
Underwriters, the Company's directors and the Company's officers who sign the
Registration Statement and their respective successors and assigns, all as and
to the extent provided in this Agreement, and no other person shall acquire or
have any right or obligation under or by virtue of this Agreement. The term
"successors and assigns" shall not include a purchaser of any of the Shares from
any of the several Underwriters merely because of such purchase.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF NEW YORK AS APPLIED TO CONTRACTS MADE AND
PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF
CONFLICT OF LAW. THE COMPANY, ON BEHALF OF ITSELF AND ITS SUBSIDIARIES, HEREBY
IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE FEDERAL AND NEW YORK
STATE COURTS LOCATED IN THE CITY OF NEW YORK, THE BOROUGH OF MANHATTAN IN
CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING RELATED TO THIS AGREEMENT OR ANY
OF THE MATTERS CONTEMPLATED HEREBY, IRREVOCABLY WAIVES ANY DEFENSE OF LACK OF
PERSONAL JURISDICTION AND IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY
SUIT, ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT. THE
COMPANY, ON BEHALF OF ITSELF AND THE SUBSIDIARIES, IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT THEY MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION
WHICH THEY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
<PAGE>
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Underwriters.
Very truly yours,
METROMEDIA INTERNATIONAL GROUP, INC.,
By: ___________________________________
Name:
Title:
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
GOLDMAN, SACHS & CO.
CHASE SECURITIES INC.
FURMAN SELZ LLC
RC SECURITIES, INC.
By: DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By: ______________________________
<PAGE>
SCHEDULE I
Number of
Firm Shares
UNDERWRITERS TO BE PURCHASED
Donaldson, Lufkin &
Jenrette Securities Corporation
Goldman, Sachs & Co.
Chase Securities Inc.
Furman Selz LLC
RC Securities, Inc.
---------
Total 3,000,000
=========
<PAGE>
ANNEX I
-------
Carl C. Brazell
John P. Imlay, Jr.
Clark A. Johnson
Silvia Kessel
John W. Kluge
Robert A. Maresca
Carl E. Sanders
Richard J. Sherwin
Stuart Subotnick
Arnold L. Wadler
<PAGE>
Exhibit 4.1
FORM OF
CERTIFICATE OF DESIGNATION
OF
___% CUMULATIVE CONVERTIBLE PREFERRED STOCK
OF
METROMEDIA INTERNATIONAL GROUP, INC.
-----------------------
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
-----------------------
METROMEDIA INTERNATIONAL GROUP, INC., a corporation organized and
existing by virtue of the General Corporation Law of the State of Delaware (the
"COMPANY"), does hereby certify that the following resolution was duly adopted
by action of the Board of Directors of the Company, with the provisions thereof
fixing the number of shares of the series, the dividend rate, and the optional
redemption prices being set by action of the Executive Committee of the Board of
Directors of the Company:
RESOLVED that pursuant to the authority expressly granted to and
vested in the Board of Directors of the Company by the provisions of Section 4.1
of the Restated Certificate of Incorporation of the Company, as amended from
time to time (the "CERTIFICATE OF INCORPORATION"), and pursuant to authority
expressly delegated to the Executive Committee of the Board of Directors of the
Company by such Board of Directors, and pursuant to Section 151(g) of the
General Corporation Law of the State of Delaware, there be created from the
70,000,000 shares of preferred stock, par value $1.00 per share, of the Company
authorized to be issued pursuant to the Certificate of Incorporation, a series
of preferred stock, consisting of 3,450,000 shares of ___% Cumulative
Convertible Preferred Stock (the "PREFERRED STOCK"), the voting powers,
designations, preferences and relative, participating, optional or other special
rights of which, and qualifications, limitations or restrictions thereof, shall
be as follows:
1. DEFINITIONS. As used herein, the following terms shall have the
following meanings:
1.2 "ACCRUED DIVIDENDS" shall mean, with respect to any share
of Preferred Stock, as of any date, the accrued and unpaid dividends on such
share from and including the most recent Dividend Payment Date (or the Issue
Date, if such date is prior to the first Dividend Payment Date) to but not
including such date.
<PAGE>
2
1.3 "ACCUMULATED DIVIDENDS" shall mean, with respect to any
share of Preferred Stock, as of any date, the aggregate accumulated and unpaid
dividends on such share from the Issue Date until the most recent Dividend
Payment Date prior to such date. There shall be no Accumulated Dividends with
respect to any share of Preferred Stock prior to the first Dividend Payment
Date.
1.4 "AFFILIATE" shall have the meaning ascribed to it, on the
date hereof, under Rule 405 of the Securities Act of 1933, as amended.
1.5 "AMEX" shall mean the American Stock Exchange or, in the
event the American Stock Exchange is not the principal stock exchange on which
the Preferred Stock is then traded or quoted, any principal successor stock
exchange or nationally recognized market where the Preferred Stock is listed or
included.
1.6 "BOARD OF DIRECTORS" shall mean the Board of Directors of
the Company or, with respect to any action to be taken by the Board of
Directors, any committee of the Board of Directors duly authorized to take such
action.
1.7 "BUSINESS DAY" shall mean any day other than a Saturday,
Sunday or other day on which commercial banks in The City of New York ate
authorized or required by law or executive order to close.
1.8 "CHANGE OF CONTROL" shall mean (i) any merger or
consolidation of the Company with or into any person or any sale, transfer or
other conveyance, whether direct or indirect, of all or substantially all of the
assets of the Company (other than a sale, transfer, assignment or distribution
of shares of capital stock or assets of Snapper and/or Landmark, on a
consolidated basis, in one transaction or a series of related transactions, if,
immediately after giving effect to such transaction, any "person" or "group"
(other than Metromedia Company and its Affiliates) is or becomes the "beneficial
owner," directly or indirectly, of more than 50% of the total voting power, in
the aggregate, normally entitled to vote in the election of directors, managers,
or trustees, as applicable, of the transferee or surviving entity; (ii) when any
"person" or "group" (other than Metromedia Company and its Affiliates) is or
becomes the "beneficial owner," directly or indirectly, of more than 50% of the
total voting power, in the aggregate, normally entitled to vote in the election
of directors of the Company; or (iii) when, during any period of 12 consecutive
months after the Issue Date, individuals who at the beginning of any such
12-month period constituted the Board of Directors of the Company (together with
any new directors whose election by such Board or whose nomination for election
by the stockholders of the Company was approved by a vote of a majority of the
directors then still in office who were either directors at the beginning of
such period or whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority of the Board of
Directors of the Company then in office.
<PAGE>
3
For purposes of the definition of "Change of Control," (i) the
terms "person" and "group" shall have the meaning used for purposes of Rules
13d-3 and 13d-5 of the Exchange Act, as in effect on the Issue Date, whether or
not applicable and (ii) the term "beneficial owner" shall have the meaning used
in Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the original
date of issuance of the Preferred Stock, whether or not applicable, except that
a "person" shall be deemed to have "beneficial ownership" of all shares that any
such person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time or upon the occurrence of certain
events.
1.9 "CHANGE OF CONTROL DATE" shall mean the date on which the
Change of Control event occurs.
1.10 "COMMON STOCK" shall mean the common stock, par value
$1.00 per share, of the Company, or any other class of stock resulting from
successive changes or reclassifications of such common stock consisting solely
of changes in par value, or from par value to no par value, or as a result of a
subdivision, combination, or merger, consolidation or similar transaction in
which the Company is a constituent corporation.
1.11 "DIVIDEND PAYMENT DATE" shall mean February 28(29), May
31, August 31 and November 30 of each year, commencing November 30, 1997.
1.12 "DIVIDEND RECORD DATE" shall mean, with respect to each
Dividend Payment Date, a date not more than 60 days nor less than 10 days
preceding a Dividend Payment Date, as shall be fixed by the Board of Directors.
1.13 "EXCHANGE ACT" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
1.14 "ISSUE DATE" shall mean September [11], 1997, the original
date of issuance of the Preferred Stock.
1.15 "JUNIOR STOCK" shall mean the Common Stock and the shares
of any other class or series of stock of the Company created on or after the
Issue Date that, by the terms of the Certificate of Incorporation or of the
instrument by which the Board of Directors, acting pursuant to authority granted
in the Certificate of Incorporation, shall fix the relative rights, preferences
and limitations thereof, shall be junior to the Preferred Stock in respect of
the right to receive dividends or to participate in any other distribution of
assets.
1.16 "LANDMARK" shall mean Landmark Theatre Corporation, a
California corporation.
<PAGE>
4
1.17 "LIQUIDATION PREFERENCE" shall mean, with respect to each
share of Preferred Stock, $50.
1.18 "MARKET VALUE" shall mean the average closing price of the
Common Stock on the AMEX for a five consecutive trading day period.
1.19 "METROMEDIA COMPANY" shall mean Metromedia Company, a
Delaware general partnership and majority stockholder of the Company.
1.20 "OPTIONAL REDEMPTION PRICE PER SHARE" shall mean, as of
any date, the price at which the Company may, at its option, redeem one share of
the Preferred Stock, payable, at the Company's option, in cash, by delivery of
fully paid and nonassessable shares of Common Stock or a combination thereof.
1.21 "PARI PASSU STOCK" shall mean the shares of any class or
series of stock of the Company created on or after the Issue Date that, by the
terms of the Certificate of Incorporation or of the instrument by which the
Board of Directors, acting pursuant to authority granted in the Certificate of
Incorporation, shall fix the relative rights, preferences and limitations
thereof, shall, in the event that the stated dividends thereon are not paid in
full, be entitled to share ratably with the Preferred Stock in the payment of
dividends, including accumulations, if any, in accordance with the sums or other
consideration which would be payable on such shares if all dividends were
declared and paid in full, or shall, in the event that the amounts payable
thereon in liquidation are not paid in full, be entitled to share ratably with
the Preferred Stock in any other distribution of assets in accordance with the
sums or other consideration which would be payable in such distribution if all
sums payable were discharged in full.
1.22 "PERSON" shall mean any individual, corporation, general
partnership, limited partnership, limited liability partnership, joint venture,
association, joint-stock company, trust, limited liability company,
unincorporated organization or government or any agency or political subdivision
thereof.
1.23 "SENIOR STOCK" shall mean any capital stock of the Company
ranking senior (either as to dividends or upon liquidation, dissolution or
winding up) to the Preferred Stock.
1.24 "SNAPPER" shall mean Snapper, Inc., a Georgia corporation.
1.25 "VOTING RIGHTS TRIGGERING EVENT" shall mean the failure of
the Company to pay dividends on the Preferred Stock with respect to periods
ending on more than six consecutive Dividend Payment Dates.
<PAGE>
5
2. DIVIDENDS.
2.1 The holders of shares of the outstanding Preferred Stock
shall be entitled, when, as and if declared by the Board of Directors out of
funds legally available therefor, to receive dividends on each outstanding share
of Preferred Stock, payable quarterly, in arrears, at an annual rate of __% (the
"DIVIDEND RATE"). Dividends payable for each full dividend period will be
computed by dividing (x) the product of the Liquidation Preference times the
Dividend Rate by (y) four and shall be payable on each Dividend Payment Date, to
the holders of record of Preferred Stock at the close of business on the
Dividend Record Date applicable to such Dividend Payment Date, commencing on
November 30, 1997. Such dividends shall be cumulative from the Issue Date and
shall accrue on a day-to-day basis, whether or not earned or declared, from and
after the Issue Date. Dividends on the Preferred Stock which are not declared
and paid when due will compound quarterly on each Dividend Payment Date at the
Dividend Rate. Dividends payable for any partial dividend period shall be
computed on the basis of actual days elapsed over a 360-day year consisting of
twelve 30-day months.
2.2 Dividends may, at the option of the Company, be paid on
any Dividend Payment Date either in cash, by issuing fully paid and
nonassessable shares of Common Stock or a combination thereof. If the Company
elects to pay dividends in shares of Common Stock, the number of shares of
Common Stock to be distributed will be calculated by dividing such payment by
95% of the Market Value ending on the Dividend Payment Date.
2.3 No dividends or other distributions (other than a dividend
or distribution in Junior Stock, other than the Common Stock) may be declared,
made or paid or set apart for payment on the Common Stock, Junior Stock or PARI
PASSU Stock, and no Common Stock, Junior Stock or any PARI PASSU Stock,
including the Preferred Stock, may be repurchased, exchanged, redeemed or
otherwise acquired for any consideration (or any money paid to or made available
for a sinking fund for the redemption of any shares of any such stock) by the
Company (except by conversion into or exchange for Junior Stock), nor may funds
be set apart for payment with respect thereto, unless full cumulative dividends
shall have been or contemporaneously are paid or declared and a sum sufficient
for the payment thereof is set apart for such payment on, and all applicable
redemption, exchange and repurchase obligations shall have been satisfied with
respect to, all outstanding shares of Preferred Stock and such other PARI PASSU
Stock. Notwithstanding the foregoing, if full dividends have not been paid on
the Preferred Stock or on any PARI PASSU Stock, dividends may be declared and
paid on the Preferred Stock and such PARI PASSU Stock so long as the dividends
are declared and paid PRO RATA so that the amounts of dividends declared per
share on the Preferred Stock and such PARI PASSU Stock will in all cases bear to
each other the same ratio that Accrued Dividends on the shares of Preferred
Stock and such PARI PASSU Stock bear to
<PAGE>
6
each other; PROVIDED, that if such dividends are paid in cash, any senior
security or in PARI PASSU Stock on any PARI PASSU Stock, dividends will also be
paid in cash, such senior security or such PARI PASSU Stock, as the case may be,
on the Preferred Stock.
2.4 Holders of shares of Preferred Stock shall not be entitled
to any dividends, whether payable in cash, property or stock, in excess of full
cumulative dividends, as herein provided, on the Preferred Stock. No interest,
or sum of money in lieu of interest, shall be payable in respect of any dividend
payment or payments on the Preferred Stock which may be in arrears (it being
understood that the compounding of unpaid dividends shall not constitute
interest or money in lieu of interest).
2.5 The holders of shares of Preferred Stock at the close of
business on a Dividend Record Date will be entitled to receive the dividend
payment on those shares (except that holders of shares called for redemption on
a redemption date between the record date and the Dividend Record Date will be
entitled to receive such dividend on such redemption date as indicated in
Section 2.1 hereof) on the corresponding Dividend Payment Date notwithstanding
the subsequent conversion thereof or the Company's default in payment of the
dividend due on that Dividend Payment Date. However, shares of Preferred Stock
surrendered for conversion during the period between the close of business on
any Dividend Record Date and the close of business on the day immediately
preceding the applicable Dividend Payment Date (except for shares called for
redemption on a redemption date during that period) must be accompanied by
payment of an amount equal to the dividend payable on the shares on that
Dividend Payment Date. A holder of shares of Preferred Stock on a Dividend
Record Date who (or whose transferee) tenders any shares for conversion on a
Dividend Payment Date will receive the dividend payable by the Company on the
Preferred Stock on that date, and the converting holder need not include payment
in the amount of such dividend upon surrender of shares of Preferred Stock for
conversion. Except as provided above, the Company shall make no payment or
allowance for unpaid dividends, whether or not in arrears, on converted shares
or for dividends on the shares of Common Stock issued upon conversion.
2.6 To the extent that the amount of any dividend payable to a
holder of Preferred Stock (in respect of all shares held by such holder) is
payable in shares of Common Stock and does not equal a whole number of shares of
Common Stock, such fractional amount shall be paid in cash to such holder of
Preferred Stock.
3. OPTIONAL REDEMPTION.
3.1 At any time on or after ________, 2000, the Company may,
at its sole option, subject to Section 2.3, redeem, out of funds legally
available therefor, all or any part of the outstanding shares of Preferred
Stock, in cash, by
<PAGE>
7
delivery of fully paid and nonassessable shares of Common Stock or a combination
thereof, upon not less than 30 days nor more than 60 days' notice provided in
the manner specified in Section 4 hereof, during the 12-month periods commencing
on September ___ of the years set forth below for the amount (expressed as a
percentage of the Liquidation Preference thereof) set forth opposite such years,
plus Accumulated Dividends and Accrued Dividends thereon to the redemption date.
Period Redemption Price Per Share
------ --------------------------
2000
2001
2002
2003
2004
2005
2006
2007 and thereafter
3.2 If the Company elects to make redemption payments in
Common Stock, the number of shares of Common Stock to be distributed will be
calculated by dividing such payment by 95% of the Market Value for the period
ending on the applicable redemption date. If any dividends on the Preferred
Stock are in arrears, no shares of Preferred Stock shall be redeemed unless all
outstanding shares of Preferred Stock are simultaneously redeemed.
4. PROCEDURE FOR REDEMPTION.
4.1 In the event the Company shall elect to redeem shares of
Preferred Stock pursuant to Section 3 hereof, notice of such redemption shall be
given (i) by publication in a newspaper of general circulation in the Borough of
Manhattan, City and State of New York (if such publication shall be required by
applicable law, rule, regulation or securities exchange requirement) or (ii) by
first-class mail to each record holder of the shares to be redeemed, at such
holder's address as the same appears on the books of the Company, in either case
not less than 30 nor more than 60 days prior to the redemption date. Each such
notice shall state (i) the time and date as of which the redemption shall occur;
(ii) the total number of shares of Preferred Stock to be redeemed and, if fewer
than all the shares held by such holder are to be redeemed, the number of such
shares to be redeemed from such holder; (iii) the redemption price (whether to
be paid in cash or shares of Common Stock); (iv) the place or places where
certificates for such shares are to be surrendered for payment of the redemption
price and delivery of certificates representing shares of Common Stock (if the
Company so chooses); (v) that dividends on the shares to be redeemed will cease
to accrue on such redemption date unless the Company defaults in the payment of
the
<PAGE>
8
redemption price; and (vi) the name of any bank or trust company, if any,
performing the duties referred to in Section 4.3 below.
4.2 On or before any redemption date, each holder of shares of
Preferred Stock to be redeemed shall surrender the certificate or certificates
representing such shares of Preferred Stock to the Company, in the manner and at
the place designated in the notice of redemption and on the redemption date, the
full redemption price, payable in cash, fully paid and nonassessable shares of
Common Stock or a combination thereof, for such shares of Preferred Stock shall
be paid or delivered to the person whose name appears on such certificate or
certificates as the owner thereof, and the shares represented by each
surrendered certificate shall be returned to authorized but unissued shares of
preferred stock of any or no series. Upon surrender (in accordance with the
notice of redemption) of the certificate or certificates representing any shares
to be so redeemed (properly endorsed or assigned for transfer, if the Company
shall so require and the notice of redemption shall so state), such shares shall
be redeemed by the Company at the redemption price. If fewer than all the
shares represented by any such certificate are to be redeemed, a new certificate
shall be issued representing the unredeemed shares, without costs to the holder
thereof, together with the amount of cash, if any, in lieu of fractional shares.
4.3 If a notice of redemption shall have been given as
provided in Section 4.1, dividends on the shares of Preferred Stock so called
for redemption shall cease to accrue, such shares shall no longer be deemed to
be outstanding, and all rights of the holders thereof as stockholders of the
Company with respect to shares so called for redemption (except for the right to
receive from the Company the redemption price) shall cease (including any right
to receive dividends otherwise payable on any Dividend Payment Date that would
have occurred after the time and date of redemption) either (i) from and after
the time and date fixed in the notice of redemption as the time and date of
redemption (unless the Company shall default in the payment of the redemption
price, in which case such rights shall not terminate at such time and date) or
(ii) if the Company shall so elect and state in the notice of redemption, from
and after the time and date (which date shall be the date fixed for redemption
or an earlier date not less than 30 days after the date of mailing of the
redemption notice) on which the Company shall irrevocably deposit in trust for
the holders of the shares to be redeemed with a designated bank or trust for the
holders of the shares to be redeemed with a designated bank or trust company
doing business in the Borough of Manhattan, City and State of New York, as
paying agent, money or a fully paid and nonassessable shares of Common Stock
sufficient to pay at the office of such paying agent, on the redemption date,
the redemption price. Any money or shares of Common Stock so deposited with any
such paying agent which shall not be required for such redemption shall be
returned to the Company forthwith. Subject to applicable escheat laws, any
moneys so set aside by the Company and unclaimed at the end of one year from the
redemption date shall revert to the general funds of the
<PAGE>
9
Company, after which reversion the holders of such shares so called for
redemption shall look only to the general funds of the Company for the payment
of the redemption price without interest. Any interest accrued on funds so
deposited shall be paid to the Company from time to time.
4.4 In the event that fewer than all the outstanding shares of
Preferred Stock are to be redeemed, the shares to be redeemed shall be
determined PRO RATA or by lot, as determined by the Company, except that the
Company may redeem such shares held by any holder of fewer than 100 shares (or
shares held by holders who would hold fewer than 100 shares as a result of such
redemption), as may be determined by the Company.
5. CHANGE OF CONTROL.
5.1 Upon the occurrence of a Change of Control of the Company,
each holder of Preferred Stock shall have a one-time option in the event that
the Market Value on the Change of Control Date is less than the Conversion Price
(the "CHANGE OF CONTROL OPTION") to convert such holder's shares of Preferred
Stock into fully paid and nonassessable shares of Common Stock, at a conversion
price equal to the greater of (i) the Market Value for the period ending on the
Change of Control Date and (ii) 66.67% of the Market Value for the period ending
on September ___, 1997. The Change of Control Option must be exercised within
30 days following a Change of Control. In lieu of issuing the shares of Common
Stock issuable upon conversion in the event of a Change of Control, the Company
may, at its sole option, make a cash payment equal to the Market Value
determined with respect to the period ending on the Change of Control Date of
the shares Common Stock otherwise issuable.
5.2 In the event of a Change of Control, notice of such Change
of Control shall be given, within five Business Days of the Change of Control
Date, by the Company by first-class mail to each record holder of shares of
Preferred Stock, at such holder's address as the same appears on the books of
the Company. Each such notice shall state: (i) that a Change of Control has
occurred; (ii) the last day on which the Change of Control Option may be
exercised (the "EXPIRATION DATE"); (iii) the name and address of the paying
agent; and (iv) the procedures that holders must follow to exercise the Change
of Control Option.
5.3 On or before the Expiration Date, each holder of shares of
Preferred Stock wishing to exercise the Change of Control Option shall surrender
the certificate or certificates representing the shares of Preferred Stock to be
converted, in the manner and at the place designated in the notice described in
Section 5.2, and on such date the cash or shares of Common Stock due to such
holder shall be delivered to the person whose name appears on such certificate
or certificates as the owner thereof and each surrendered certificate shall be
returned to authorized but unissued shares.
<PAGE>
10
Upon surrender (in accordance with the notice described in Section 5.2 of the
certificate or certificates representing any shares to be so converted (properly
endorsed or assigned for transfer, if the Company shall so require and the
notice shall so state), such shares shall be converted by the Company at the
conversion price.
5.4 The rights of holders of Preferred Stock pursuant to the
Section 5 are in addition to, and not in lieu of, the rights of holders of
Preferred Stock provided for in Section 8 hereof.
6. VOTING.
6.1 The shares of Preferred Stock shall have no voting rights
except as required by law or as set forth below:
(a) If and whenever at any time or times, a Voting
Rights Triggering Event occurs, then the number of directors constituting the
Board of Directors shall be increased by two and the holders of shares of
Preferred Stock, voting separately as a class with any other PARI PASSU Stock
(the "VOTING RIGHTS CLASS"), will be entitled at the next regular or special
meeting of stockholders of the Company to elect two directors of the Company to
fill the newly created directorships.
(b) Such voting rights may be exercised at a special
meeting of the holders of the shares of the Voting Rights Class, called as
hereinafter provided, or at any annual meeting of stockholders held for the
purpose of electing directors, and thereafter at each such annual meeting until
such time as all dividends in arrears on the shares of Preferred Stock shall
have been paid in full, at which time or times such voting rights and the term
of the directors elected pursuant to Section 6.1(a) shall terminate.
(c) At any time when such voting rights shall have
vested in holders of shares of the Voting Rights Class described in
Section 6.1(a), a proper officer of the Company may call, and, upon the written
request of the record holders of shares representing twenty-five percent (25%)
of the voting power of the shares then outstanding of the Voting Rights Class,
addressed to the Secretary of the Company, shall call a special meeting of the
holders of shares of the Voting Rights Class. Such meeting shall be held at the
earliest practicable date upon the notice required for annual meetings of
stockholders at the place for holding annual meetings of stockholders of the
Company, or, if none, at a place designated by the Board of Directors.
Notwithstanding the provisions of this Section 6.1(c), no such special meeting
shall be called during a period within the 60 days immediately preceding the
date fixed for the next annual meeting of stockholders in which such case, the
election of directors pursuant to Section 6.1(a) shall be held at such annual
meeting of stockholders.
<PAGE>
11
(d) At any meeting held for the purpose of electing
directors at which the holders of the Voting Rights Class shall have the right
to elect directors as provided herein, the presence in person or by proxy of the
holders of shares representing more than fifty percent (50%) in voting power of
the then outstanding shares of the Voting Rights Class shall be required and
shall be sufficient to constitute a quorum of such class for the election of
directors by such class.
(e) Any director elected pursuant to the voting rights
created under this Section 6.1 shall hold office until the next annual meeting
of stockholders (unless such term has previously terminated pursuant to Section
6.1(b)) and any vacancy in respect of any such director shall be filled only by
vote of the remaining director so elected by holders of the Voting Rights Class,
or if there be no such remaining director, by the holders of shares of the
Voting Rights Class at a special meeting called in accordance with the
procedures set forth in this Section 6, or, if no such special meeting is
called, at the next annual meeting of stockholders. Upon any termination of
such voting rights, the term of office of all directors elected pursuant to this
Section 6 shall terminate.
(f) So long as any shares of Preferred Stock remain
outstanding, unless a greater percentage shall then be required by law, the
Company shall not, without the affirmative vote or consent of the holders of at
least 662/3% of the outstanding Preferred Stock voting or consenting, as the
case may be, separately as one class, (i) create, authorize or issue any Senior
Stock or (ii) amend the Certificate of Incorporation so as to affect adversely
the specified rights, preferences, privileges or voting rights of holders of
shares of Preferred Stock, including (x) increasing the authorized number of
shares of preferred stock and (y) issuing any shares of Preferred Stock in
excess of the number of shares authorized in this Certificate of Designation as
of the Issue Date. The holders of at least a majority of the outstanding shares
of Preferred Stock, voting separately as one class, may waive compliance with
any provision of this Certificate of Designation.
(g) In exercising the voting rights set forth in this
Section 6.1, each share of Preferred Stock shall be entitled to one vote.
6.2 Except as set forth in Section 6.1, the Company may
create, authorize or issue any shares of Junior Stock or PARI PASSU Stock or
increase or decrease the amount of authorized capital stock of any class other
than the preferred stock, without the consent of the holders of Preferred Stock,
voting separately as a class, and in taking such actions the Company shall not
be deemed to have affected adversely the rights, preferences, privileges or
voting rights of holders of shares of Preferred Stock.
<PAGE>
12
7. LIQUIDATION RIGHTS.
7.1 In the event of any liquidation, dissolution or winding-up
of the Company, whether voluntary or involuntary, the holders of the shares of
Preferred Stock shall be entitled to receive out of the assets of the Company
available for distribution to stockholders up to the Liquidation Preference plus
Accumulated Dividends and Accrued Dividends thereon in preference to the holders
of, and before any distribution is made on, any Junior Stock, including, without
limitation, on any Common Stock.
7.2 Neither the sale, conveyance, exchange or transfer (for
cash, shares of stock, securities or other consideration) of all or
substantially all the property and assets of the Company nor the merger or
consolidation of the Company into or with any other corporation, or the merger
or consolidation of any other corporation into or with the Company, shall be
deemed to be a liquidation, dissolution or winding up, voluntary or involuntary,
for the purposes of this Section 7.
7.3 After the payment to the holders of the shares of
Preferred Stock of full preferential amounts provided for in this Section 7, the
holders of Preferred Stock as such shall have no right or claim to any of the
remaining assets of the Company.
7.4 In the event the assets of the Company available for
distribution to the holders of shares of Preferred Stock upon any liquidation,
dissolution or winding up of the Company, whether voluntary or involuntary,
shall be insufficient to pay in full all amounts to which such holders are
entitled pursuant to Section 7.1, no such distribution shall be made on account
of any shares of any PARI PASSU Stock upon such liquidation, dissolution or
winding up unless proportionate distributable amounts shall be paid on account
of the shares of Preferred Stock, ratably, in proportion to the full
distributable amounts for which holders of all Preferred Stock and PARI PASSU
Stock are entitled upon such liquidation, dissolution or winding up.
8. CONVERSION.
(a) Each holder of Preferred Stock shall have the right,
at its option, at any time and from time to time from the Issue Date to convert,
subject to the terms and provisions of this Section 8, any or all of such
holder's shares of Preferred Stock. In such case, the shares of Preferred Stock
shall be converted into such number of fully paid and nonassessable shares of
Common Stock as is equal, subject to Section 8(g), to the product of the number
of shares of Preferred Stock being so converted multiplied by the quotient of
(i) the Liquidation Preference plus any Accumulated Dividends and any Accrued
Dividends to and including the date of conversion divided by (ii) the Conversion
Price (as defined below) then in effect,
<PAGE>
13
except that with respect to any share which shall be called for redemption such
right shall terminate at the close of business on the date of redemption of such
share, unless the Company shall default in performance or payment due upon
exchange or redemption thereof. The Conversion Price shall be $______, subject
to adjustment as set forth in Section 8(c).
The conversion right of a holder of Preferred Stock shall
be exercised by the holder by the surrender of the certificates representing
shares to be converted to the Company at any time during usual business hours at
its principal place of business or the offices of its duly appointed transfer
agent for the Preferred Stock to be maintained by it, accompanied by written
notice that the holder elects to convert all or a portion of the shares of
Preferred Stock represented by such certificate and specifying the name or names
(with address) in which a certificate or certificates for shares of Common Stock
are to be issued and (if so required by the Company or its duly appointed
transfer agent for the Preferred Stock) by a written instrument or instruments
of transfer in form reasonably satisfactory to the Company or its duly appointed
transfer agent for the Preferred Stock duly executed by the holder or its duly
authorized legal representative and transfer tax stamps or funds therefor, if
required pursuant to Section 8(i). Immediately prior to the close of business
on the date of receipt by the Company or its duly appointed transfer agent for
the Preferred Stock of notice of conversion of shares of Preferred Stock, each
converting holder of Preferred Stock shall be deemed to be the holder of record
of Common Stock issuable upon conversion of such holder's Preferred Stock
notwithstanding that the share register of the Company shall then be closed or
that certificates representing such Common Stock shall not then be actually
delivered to such person. Upon notice from the Company, each holder of
Preferred Stock so converted shall promptly surrender to the Company, at any
place where the Company shall maintain a transfer agent for its Preferred Stock,
certificates representing the shares so converted, duly endorsed in blank or
accompanied by proper instruments of transfer. On the date of any conversion,
all rights with respect to the shares of Preferred Stock so converted, including
the rights, if any, to receive notices, will terminate, except only the rights
of holders thereof to (i) receive certificates for the number of shares of
Common Stock into which such shares of Preferred Stock have been converted; (ii)
the payment of any Accumulated Dividends or Accrued Dividends thereon; and (iii)
exercise the rights to which they are entitled as holders of Common Stock.
If the last day for the exercise of the conversion right
shall not be a Business Day, then such conversion right may be exercised on the
next preceding Business Day.
(b) When shares of Preferred Stock are converted
pursuant to this Section 8, all Accumulated Dividends and all Accrued Dividends
(whether or not declared or currently payable) on the Preferred Stock so
converted to
<PAGE>
14
(and not including) the date of conversion shall be immediately due and payable,
at the Company's option, (i) in cash; (ii) in a number of fully paid and
nonassessable shares of Common Stock equal to the quotient of (A) the amount of
Accumulated Dividends and Accrued Dividends payable to the holders of Preferred
Stock hereunder, divided by (B) the Market Value for the period ending on the
date of conversion; or (iii) a combination thereof.
(c) The Conversion Price shall be subject to adjustment
as follows:
(i) In case the Company shall at any time or from
time to time (A) make a redemption payment or pay a dividend (or other
distribution) payable in shares of Common Stock on any class of capital stock
(which, for purposes of this Section 8(c) shall include, without limitation, any
dividends or distributions in the form of options, warrants or other rights to
acquire capital stock) of the Company (other than the issuance of shares of
Common Stock in connection with the payment in redemption for, of dividends on
or the conversion of Preferred Stock); (B) subdivide the outstanding shares of
Common Stock into a larger number of shares; (C) combine the outstanding shares
of Common Stock into a smaller number of shares; (D) issue any shares of its
capital stock in a reclassification of the Common Stock; or (E) pay a dividend
or make a distribution to all holders of shares of Common Stock (other than a
dividend or distribution paid or made to holders of shares of Preferred Stock in
the manner provided in Section 8 (b)) pursuant to a stockholder rights plan,
"poison pill" or similar arrangement then, and in each such case, the Conversion
Price in effect immediately prior to such event shall be adjusted (and any other
appropriate actions shall be taken by the Company) so that the holder of any
share of Preferred Stock thereafter surrendered for conversion shall be entitled
to receive the number of shares of Common Stock that such holder would have
owned or would have been entitled to receive upon or by reason of any of the
events described above, had such share of Preferred Stock been converted
immediately prior to the occurrence of such event. An adjustment made pursuant
to this Section 8(c)(i) shall become effective retroactively (x) in the case of
any such dividend or distribution, to the day immediately following the close of
business on the record date for the determination of holders of Common Stock
entitled to receive such dividend or distribution or (y) in the case of any such
subdivision, combination or reclassification, to the close of business on the
day upon which such corporate action becomes effective.
(ii) In case the Company shall at any time or from
time to time issue or sell shares of Common Stock (or securities convertible
into or exchangeable for shares of Common Stock, or any options, warrants or
other rights to acquire shares of Common Stock) to holders of its Common Stock
at a price per share less than the Market Value for the period ending on the
date of issuance (treating the price per share of any security convertible or
exchangeable or exercisable into
<PAGE>
15
Common Stock as equal to (A) the sum of the price for such security convertible,
exchangeable or exercisable into Common Stock plus any additional consideration
payable (without regard to any anti-dilution adjustments) upon the conversion,
exchange or exercise of such security into Common Stock divided by (B) the
number of shares of Common Stock initially underlying such convertible,
exchangeable or exercisable security), other than (I) issuances or sales for
which an adjustment is made pursuant to another paragraph of this Section 8(c),
(II) issuances of shares of Common Stock or securities exercisable or
convertible into Common Stock pursuant to mergers, acquisitions, consolidations,
exchanges, reorganizations or combinations or bona fide stock incentive plans
for employees, directors and consultants of the Company or (III) issuances that
are subject to certain triggering events (until such time as such triggering
events occur), then, and in each such case, the Conversion Price then in effect
shall be adjusted by dividing the Conversion Price in effect on the day
immediately prior to such record date by a fraction (x) the numerator of which
shall be the sum of the number of shares of Common Stock outstanding on such
record date plus the number of additional shares of Common Stock issued or to be
issued (or the maximum number into which such convertible or exchangeable
securities initially may convert or exchange or for which such options, warrants
or other rights initially may be exercised) and (y) the denominator of which
shall be the sum of the number of shares of Common Stock outstanding on such
record date plus the number of shares of Common Stock which the aggregate
consideration for the total number of such additional shares of Common Stock so
issued (or into which such convertible or exchangeable securities may convert or
exchange or for which such options, warrants or other rights may be exercised
plus the aggregate amount of any additional consideration initially payable upon
conversion, exchange or exercise of such security) would purchase at the Market
Value for the period ending on the date of conversion; PROVIDED, that if the
holders of Preferred Stock are offered the opportunity to participate in any
such offering on a pro rata basis with the holders of Common Stock and decline
to participate or if the holders of Preferred Stock are entitled to receive such
options, warrants or other rights upon conversion at any time of their shares of
Preferred Stock, then in either such case, no adjustment shall be made pursuant
to this Section 8(c)(ii). Such adjustment shall be made whenever such shares,
securities, options, warrants or other rights are issued, and shall become
effective retroactively to a date immediately following the close of business on
the record date for the determination of stockholders entitled to receive such
shares, securities, options, warrants or other rights; PROVIDED, HOWEVER, that
the determination as to whether an adjustment is required to be made pursuant to
this Section 8(c)(ii) shall only be made upon the issuance of such shares or
such convertible or exchangeable securities, options, warrants or other rights,
and not upon the issuance of the security into which such convertible or
exchangeable security converts or exchanges, or the security underlying such
option, warrants or other right; PROVIDED FURTHER, that if any convertible or
exchangeable securities, options, warrants or other rights (or any portions
thereof) which shall have given rise to an adjustment pursuant to this Section
<PAGE>
16
8(c)(ii) shall have expired or terminated without the exercise thereof and/or if
by reason of the terms of such convertible or exchangeable securities, options,
warrants or other rights there shall have been an increase or increases, with
the passage of time or otherwise, in the price payable upon the exercise or
conversion thereof, then the Conversion Price hereunder shall be readjusted (but
to no greater extent than originally adjusted) on the basis of (i) eliminating
from the computation any additional shares of Common Stock corresponding to such
convertible or exchangeable securities, options, warrants or other rights as
shall have expired or terminated; (ii) treating the additional shares of Common
Stock, if any, actually issued or issuable pursuant to the previous exercise of
such convertible or exchangeable securities, options, warrants or other rights
as having been issued for the consideration actually received and receivable
therefor; and (iii) treating any of such convertible or exchangeable securities,
options, warrants or other rights which remain outstanding as being subject to
exercise or conversion on the basis of such exercise or conversion price as
shall be in effect at the time.
(iii) In case the Company shall at any time or from
time to time (A) make a distribution to all holders of shares of its Common
Stock consisting exclusively of cash (excluding any cash portion of
distributions referred to in (i) above, or cash distributed upon a merger or
consolidation to which (g) below applies), that, when combined together with
(x) all other such all-cash distributions made within the then-preceding 12
months in respect of which no adjustment has been made and (y) any cash and the
fair market value of other consideration paid or payable in respect of any
tender offer by the Company or any of its subsidiaries for shares of Common
Stock concluded within the then-preceding 12 months in respect of which no
adjustment has been made, in the aggregate exceeds 15% of the Company's market
capitalization (defined as the product of the Market Value for the period ending
on the record date of such distribution times the number of shares of Common
Stock then outstanding) on the record date of such distribution, (B) complete a
tender or exchange offer by the Company or any of its subsidiaries for shares of
Common Stock that involves an aggregate consideration that, together with
(I) any cash and other consideration payable in a tender or exchange offer by
the Company or any of its subsidiaries for shares of Common Stock expiring
within the then-preceding 12 months in respect of which no adjustment has been
made and (II) the aggregate amount of any such all-cash distributions referred
to in (A) above to all holders of shares of Common Stock within the
then-preceding 12 months in respect of which no adjustments have been made,
exceeds 15% of the Company's market capitalization on the expiration of such
tender offer or (C) make a distribution to all holders of its Common Stock
consisting of evidences of indebtedness, shares of its capital stock other than
Common Stock or assets (including securities, but excluding those dividends,
rights, options, warrants and distributions referred to in (i) and (ii) above),
then, and in each such case, the Conversion Price then in effect shall be
adjusted by dividing the Conversion Price in effect immediately prior to the
date of such distribution by a fraction (x) the
<PAGE>
17
numerator of which shall be the Market Value for the period ending on the record
date referred to below and (y) the denominator of which shall be such Market
Value less then the fair market value (as determined by the Board of Directors
of the Company) of the portion of the cash, evidences of indebtedness,
securities or other assets so distributed, applicable to one share of Common
Stock (but such denominator not to be less than one); PROVIDED, HOWEVER, that no
adjustment shall be made with respect to any distribution of rights to purchase
securities of the Company if the holder of shares of Preferred Stock would
otherwise be entitled to receive such rights upon conversion at any time of
shares of Preferred Stock into shares of Common Stock unless such rights are
subsequently redeemed by the Company, in which case such redemption shall be
treated for purposes of this Section 8(c)(iii) as a dividend on the Common
Stock. Such adjustment shall be made whenever any such distribution is made and
shall become effective retroactively to a date immediately following the close
of business on the record date for the determination of stockholders entitled to
receive such distribution.
(iv) In the case the Company at any time or from
time to time shall take any action affecting its Common Stock (it being
understood that the issuance or sale of shares of Common Stock (or securities
convertible into or exchangeable for shares of Common Stock, or any options,
warrants or other rights to acquire shares of Common Stock) to any Person at a
price per share less than the Conversion Price then in effect shall not be
deemed such an action), other than an action described in any of Section 8(c)(i)
through Section 8(c)(iii), inclusive, or Section 8(g), then, the Conversion
Price shall be adjusted in such manner and at such time as the Board of
Directors of the Company in good faith determines to be equitable in the
circumstances (such determination to be evidenced in a resolution, a certified
copy of which shall be mailed to the holders of the Preferred Stock).
(v) Notwithstanding anything herein to the
contrary, no adjustment under this Section 8(c) need be made to the Conversion
Price unless such adjustment would require an increase or decrease of at least
1% of the Conversion Price then in effect. Any lesser adjustment shall be
carried forward and shall be made at the time of and together with the next
subsequent adjustment, which, together with any adjustment or adjustments so
carried forward, shall amount to an increase or decrease of at least 1% of such
Conversion Price.
(vi) The Company reserves the right to make such
reductions in the Conversion Price in addition to those required in the
foregoing provisions as it considers advisable in order that any event treated
for Federal income tax purposes as a dividend of stock or stock rights will not
be taxable to the recipients. In the event the Company elects to make such a
reduction in the Conversion Price, the Company will comply with the requirements
of Rule 14e-1 under the Exchange Act, and any other securities laws and
regulations thereunder if and to the extent that such
<PAGE>
18
laws and regulations are applicable in connection with the reduction of the
Conversion Price.
(d) If the Company shall take a record of the holders of
its Common Stock for the purpose of entitling them to receive a dividend or
other distribution, and shall thereafter and before the distribution to
stockholders thereof legally abandon its plan to pay or deliver such dividend or
distribution, then thereafter no adjustment in the Conversion Price then in
effect shall be required by reason of the taking of such record.
(e) Upon any increase or decrease in the Conversion
Price, then, and in each such case, the Company promptly shall deliver to each
registered holder of Preferred Stock a certificate signed by an authorized
officer of the Company, setting forth in reasonable detail the event requiring
the adjustment and the method by which such adjustment was calculated and
specifying the increased or decreased Conversion Price then in effect following
such adjustment.
(f) No fractional shares or scrip representing
fractional shares of Common Stock shall be issued upon the conversion of any
shares of Preferred Stock. If more than one share of Preferred Stock shall be
surrendered for conversion at one time by the same holder, the number of full
shares of Common Stock issuable upon conversion thereof shall be computed on the
basis of the aggregate Liquidation Preference of the shares of Preferred Stock
so surrendered. If the conversion of any share or shares of Preferred Stock
results in a fraction, an amount equal to such fraction multiplied by the last
reported sale price of the Common Stock on the AMEX at the close of business on
the trading day next preceding the day of conversion shall be paid to such
holder in cash by the Company.
(g) In case of any capital reorganization or
reclassification or other change of outstanding shares of Common Stock (other
than a change in par value, or from par value to no par value, or from no par
value to par value), or in case of any consolidation or merger of the Company
with or into another Person (other than a consolidation or merger in which the
Company is the resulting or surviving Person and which does not result in any
reclassification or change of outstanding Common Stock), or in case of any sale
or other disposition to another Person of all or substantially all of the assets
of the Company (other than the sale, transfer, assignment or distribution of
shares of capital stock or assets of Snapper and/or Landmark) (any of the
foregoing, a "TRANSACTION"), each share of Preferred Stock then outstanding
shall, without the consent of any holder of Preferred Stock, become convertible
only into the kind and amount of shares of stock or other securities (of the
Company or another issuer) or property or cash receivable upon such Transaction
by a holder of the number of shares of Common Stock into which such share of
Preferred Stock could have been converted immediately prior to such
<PAGE>
18
Transaction after giving effect to any adjustment event. The provisions of this
Section 8(g) and any equivalent thereof in any such certificate similarly shall
apply to successive Transactions. The provisions of this Section 8(g) shall be
the sole right of holders of Preferred Stock in connection with any Transaction
and such holders shall have no separate vote thereon.
(h) In the case of any distribution by the Company to
its stockholders of substantially all of its assets (other than a sale,
transfer, assignment or distribution of shares of capital stock or assets of
Snapper and/or Landmark), each holder of Preferred Stock will participate PRO
RATA in such distribution based on the number of shares of Common Stock into
which such holders' shares of Preferred Stock would have been convertible
immediately prior to such distribution.
(i) The Company shall at all times reserve and keep
available for issuance upon the conversion of the Preferred Stock, such number
of its authorized but unissued shares of Common Stock as will from time to time
be sufficient to permit the conversion of all outstanding shares of Preferred
Stock, and shall take all action required to increase the authorized number of
shares of Common Stock if at any time there shall be insufficient authorized but
unissued shares of Common Stock to permit such reservation or to permit the
conversion of all outstanding shares of Preferred Stock.
(j) The issuance or delivery of certificates for Common
Stock upon the conversion of shares of Preferred Stock shall be made without
charge to the converting holder of shares of Preferred Stock for such
certificates or for any tax in respect of the issuance or delivery of such
certificates or the securities represented thereby, and such certificates shall
be issued or delivered in the respective names of, or in such names as may be
directed by, the holders of the shares of Preferred Stock converted; PROVIDED,
HOWEVER, that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and delivery of any
such certificate in a name other than that of the holder of the shares of
Preferred Stock converted, and the Company shall not be required to issue or
deliver such certificate unless or until the Person or Persons requesting the
issuance or delivery thereof shall have paid to the Company the amount of such
tax or shall have established to the reasonable satisfaction of the Company that
such tax has been paid.
9. TRANSFER AGENT AND REGISTRAR. The duly appointed transfer agent
and registrar (the "TRANSFER AGENT") for the Preferred Stock shall be
ChaseMellon Shareholder Services, L.L.C. The Company may, in its sole
discretion, remove the Transfer Agent with 10 days' prior written notice to the
Transfer Agent; PROVIDED, that the Company shall appoint a successor Transfer
Agent who shall accept such appointment prior to the effectiveness of such
removal.
<PAGE>
19
10. OTHER PROVISIONS.
10.1 With respect to any notice to a holder of shares of
Preferred Stock required to be provided hereunder, neither failure to mail such
notice, nor any defect therein or in the mailing thereof, to any particular
holder shall affect the sufficiency of the notice or the validity of the
proceedings referred to in such notice with respect to the other holders or
affect the legality or validity of any distribution, rights, warrant,
reclassification, consolidation, merger, conveyance, transfer, dissolution,
liquidation or winding up, or the vote upon any such action. Any notice which
was mailed in the manner herein provided shall be conclusively presumed to have
been duly given whether or not the holder receives the notice.
10.2 Shares of Preferred Stock issued and reacquired will be
retired and canceled promptly after reacquisition thereof and, upon compliance
with the applicable requirements of Delaware law, have the status of authorized
but unissued shares of preferred stock of the Company undesignated as to series
and may with any and all other authorized but unissued shares of preferred stock
of the Company be designated or redesignated and issued or reissued, as the case
may be, as part of any series of preferred stock of the Corporation, except that
any issuance or reissuance of shares of Preferred Stock must be in compliance
with this Certificate of Designation.
10.3 The shares of Preferred Stock shall be issuable in whole
shares.
10.4 All notices periods referred to herein shall commence on
the date of the mailing of the applicable notice.
IN WITNESS WHEREOF, the Company has caused this certificate to be
signed and attested this ______ day of September, 1997.
METROMEDIA INTERNATIONAL GROUP,
INC.
By:
-------------------------------------------------
Name: Stuart Subotnick
Title: President and Chief Executive Officer
Attest:
- ----------------------------
Name: Arnold L. Wadler
Title: Secretary
<PAGE>
Exhibit 5
[PAUL, WEISS, RIFKIND, WHARTON & GARRISON]
September 10, 1997
Metromedia International Group, Inc.
One Meadowlands Plaza
East Rutherford, New Jersey 07073-2137
Metromedia International Group, Inc.
Registration Statement on Form S-3
Registration No. 333-24601
------------------------------------------
Ladies and Gentlemen:
In connection with the above-captioned Registration Statement (the
"REGISTRATION STATEMENT") filed by Metromedia International Group, Inc., a
Delaware corporation (the "COMPANY"), with the Securities and Exchange
Commission on April 4, 1997 pursuant to the Securities Act of 1933, as
amended (the "ACT"), and the rules and regulations thereunder as amended
through the date hereof, we have been requested to render our opinion as to
the legality of the (i) 3,450,000 shares (including shares to cover exercise
of the Underwriters' over-allotment option) of the Company's __% Cumulative
Convertible Preferred Stock, par value $1.00 per share (the "PREFERRED
STOCK"); (ii) [ ] shares (including shares to cover exercise of the
Underwriters' over-allotment option) of the Company's common stock, par value
$1.00 per share (the "COMMON STOCK, and together with the Preferred Stock,
the "SECURITIES"), issuable upon conversion of the Preferred Stock being
registered thereunder; and (iii) such additional number of Securities as may
be issued in connection with the Registration Statement pursuant to a
Registration Statement filed pursuant to Rule 462(b) of the Act. Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings ascribed thereto in the Registration Statement.
In connection with this opinion, we have examined originals, or copies
certified or otherwise identified to our satisfaction, of (i) the Registration
Statement (including all amendments thereto); (ii) the form of Underwriting
Agreement included as Exhibit 1 to the Registration Statement (the "UNDERWRITING
AGREEMENT"); (iii) the form of the Certificate of Designation of the Preferred
Stock included as Exhibit 4.1 to the Registration Statement (the "CERTIFICATE OF
DESIGNATION"); (iv) the Restated Certificate of Incorporation and the By-laws of
the Company, each as amended to date; and (v) records of certain of the
Company's proceedings relating to, among other things, the issuance and sale of
the Securities. In addition, we have made such other examinations of law and
facts as we considered necessary in order to form a basis for the opinions
hereunder expressed.
<PAGE>
2
In our examination of the aforesaid documents, we have assumed,
without independent investigation, the genuineness of all signatures, the
enforceability of the documents against each party thereto other than the
Company, the authenticity of all documents submitted to us as originals, the
conformity to the original documents of all documents submitted to us as
certified, photostatic, reproduced or conformed copies of validly existing
agreements or other documents, the authenticity of all such latter documents and
the legal capacity of all individuals who have executed any of the documents we
have reviewed. The opinions set forth herein assume that the Company takes no
corporate action following the date hereof inconsistent with its obligations
under the Underwriting Agreement or with respect to the Securities.
In expressing the opinions set forth herein, we have relied upon
representations as to factual matters contained in certificates of officers of
the Company.
Based upon the foregoing, and subject to the assumptions, exceptions
and qualifications set forth herein, we are of the opinion that (i) the
Preferred Stock has been duly authorized and, assuming the Certificate of
Designation is duly filed with the Secretary of State of the State of Delaware,
when the Preferred Stock is issued and delivered in accordance with the
Certificate of Designation, the Underwriting Agreement and the Registration
Statement, the Preferred Stock will be legally issued, fully paid and
nonassessable and (ii) the Common Stock has been duly authorized and when the
Common Stock is issued and delivered in accordance with the Certificate of
Designation and the Registration Statement, the Common Stock will be legally
issued, fully paid and nonassessable.
The foregoing opinion is limited to the federal laws of the United
States, the laws of the State of New York and the General Corporation Law of the
State of Delaware. Our opinion is rendered only with respect to the laws, and
the rules, regulations and orders thereunder, which are currently in effect.
Please be advised that no member of this firm is admitted to practice law in the
State of Delaware.
<PAGE>
3
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to the reference to us under the heading "Legal
Matters" in the Prospectus. In giving such consent, we do not thereby admit
that we are in the category of persons whose consent is required under Section 7
of the Act.
Very truly yours,
PAUL, WEISS, RIFKIND, WHARTON & GARRISON
