Registration No. 333-
~As filed with the Securities and Exchange Commission on April 6, 1999
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
HEARST-ARGYLE TELEVISION, INC.
(Exact name of registrant as specified in its charter)
Delaware 74-2717523
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
------------------------- --------------------
888 Seventh Avenue 10106
New York, New York (Zip Code)
(Address of principal executive offices)
HEARST-ARGYLE TELEVISION, INC.
1998 EMPLOYEE STOCK PURCHASE PLAN
(Full title of the plan)
DEAN H. BLYTHE
Senior Vice President--Corporate Development,
Secretary and General Counsel
Hearst-Argyle Television, Inc.
888 Seventh Avenue
New York, New York 10106
(212) 649-2000
(Name, address and telephone number,
including area code, of agent for service)
With a copy to:
STEVEN A. HOBBS, ESQ.
BONNIE A. BARSAMIAN, ESQ.
Rogers & Wells LLP
200 Park Avenue
New York, New York 10166
(212) 878-8000
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=========================================== =================== ================== =========================== ====================
Proposed Maximum Proposed Maximum
Amount to be Offering Price Aggregate Offering Amount of
Title of Securities to be Registered Registered(1) Per Share(2) Price Registration Fee(2)
<S> <C> <C> <C> <C> <C>
=========================================== =================== ================== =========================== ====================
Series A Common Stock, par value $.01 5,000,000 $24.75 $123,750,000.00 $34,405.00
=========================================== =================== ================== =========================== ====================
</TABLE>
(1) Pursuant to Rule 416(a) under the Securities Act of 1933, as
amended (the "Securities Act"), the number of shares being
registered shall be adjusted to include any additional shares
which may become issuable as a result of stock splits, stock
dividends, or similar transactions in accordance with provisions
of the plan.
(2) Estimated, pursuant to Rule 457(h), on the basis of the average
of the high and the low prices of the Company's Series A Common
Stock reported on the New York Stock Exchange on April 1, 1999.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The information specified by Item 1 and Item 2 of Part I of Form S-8 is
omitted from this filing in accordance with the provisions of Rule 428 under the
Securities Act and the introductory Note to Part I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
We incorporate by reference into this Registration Statement the
following documents filed with the Securities and Exchange Commission under the
File Number 1-14776:
1. Our Annual Report on Form 10-K for the year ended December 31, 1998;
2. Our Current Report on Form 8-K filed December 16, 1998, as amended by
the Form 8-K/A filed on January 26, 1999 and the Form 8-K/A filed on February
10, 1999; our Current Report on Form 8-K filed January 20, 1999; and our Current
Report on Form 8-K filed on March 26, 1999;
3. The description of our Series A Common Stock contained in the
Company's Registration Statement on Form 8-A/A filed on July 14, 1998; and
4. All other reports filed pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act since December 31, 1998.
When we file documents in accordance with Section 13(a), 13(c), 14 and
15(d) of the Exchange Act between the date of this Registration Statement and
the time we file a post-effective amendment to the Registration Statement saying
all the securities which are the subject of that Registration Statement have
been sold or deregistering any securities which have not been sold, the
documents we file will be incorporated into this Registration Statement and will
be a part of it beginning on the date the documents are filed. If any documents
which we file changes anything said in this Registration Statement or in an
earlier document which is incorporated into this Registration Statement, the
later document will modify or supersede what is said in this Registration
Statement or the earlier document.
You may request a copy of these filings at no cost, other than exhibits
to those documents which are not specifically incorporated by reference, by
writing or telephoning us at the following address:
Dean H. Blythe, Secretary
Hearst-Argyle Television, Inc.
888 Seventh Avenue
New York, New York 10106
(212) 649-2000
Item 4. Description of Securities
Not applicable.
Item 5. Interests of Named Experts and Counsel
Not applicable
2
<PAGE>
Item 6. Indemnification of Directors and Officers
Subsection (a) of Section 145 of the Delaware General
Corporation Law (the "DGCL") empowers a corporation to indemnify any director or
officer, or former director or officer, who was or is a party or is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of the corporation), against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred in connection with such action, suit or proceeding provided
that such director or officer acted in good faith and in a manner reasonably
believed to be in or not opposed to the best interests of the corporation, and,
with respect to any criminal action or proceeding, provided that such director
or officer had no reasonable cause to believe his or her conduct was unlawful.
Subsection (b) of Section 145 of the DGCL empowers a
corporation to indemnify any director or officer, or former director or officer,
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that such person acted in
any of the capacities set forth above, against expenses (including attorney's
fees) actually and reasonably incurred in connection with the defense or
settlement of such action or suit provided that such director or officer acted
in good faith and in a manner reasonably believed to be in or not opposed to the
best interests of the corporation, except that no indemnification may be made in
respect of any claim, issue or matter as to which such director or officer shall
have been adjudged to be liable to the corporation unless and only to the extent
that the Court of Chancery or the court in which such action was brought shall
determine that despite the adjudication of liability such director or officer is
fairly and reasonably entitled to indemnity for such expenses as the court shall
deem proper.
Section 145 of the DGCL further provides that to the extent a
present or former director or officer of a corporation has been successful in
the defense of any action, suit or proceeding referred to in subsections (a) and
(b) or in the defense of any claim, issue or matter therein, he or she shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him or her in connection therewith; that indemnification provided
for in Section 145 shall not be deemed exclusive of any other rights to which
the indemnified party may be entitled; and that the corporation shall have power
to purchase and maintain insurance on behalf of a director or officer of the
corporation against any liability asserted against him or her or incurred by him
or her in any such capacity or arising out of his or her status as such whether
or not the corporation would have the power to indemnify him or her against such
liabilities under Section 145.
Article Seven of the Hearst-Argyle Amended and Restated
Certificate of Incorporation provides that Hearst-Argyle shall indemnify to the
fullest extent permitted by the DGCL any and all of its directors and officers,
or former directors and officers, or any person who may have served at
Hearst-Argyle's request as a director or officer of another corporation,
partnership, limited liability company, joint venture, trust or other entity or
enterprise.
Article Eight of the Hearst-Argyle Amended and Restated
Certificate of Incorporation provides that, to the fullest extent permitted by
the DGCL, a director or former director of Hearst-Argyle shall not be personally
liable to Hearst-Argyle or its stockholders for monetary damages for breach of
fiduciary duty as a director.
Hearst-Argyle maintains liability insurance insuring its
officers and directors against liabilities that they may incur in such
capacities, including liabilities arising under the Federal securities laws
other than liabilities arising out of the filing of a registration statement
with the Securities and Exchange Commission.
3
<PAGE>
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
4.1 -- Amended and Restated Certificate of Incorporation of
the Company (incorporated by reference to Appendix C of
the Company's Registration Statement on Form S-4 (File No.
333-32487))
4.2 -- Amended and Restated Bylaws of the Company
(incorporated by reference to Exhibit 3.2 of the
Company's Registration Statement on Form S-4 (File
No. 333-72207))
4.3 -- Specimen of stock certificate for the Company's Series
A Common Stock, $.01 par value per share (incorporated by
reference to Exhibit 4.3 of the Company's Form 8-A/A dated
September 5, 1997)
5.1 -- Opinion of Rogers & Wells LLP
23.1 -- Consent of Rogers & Wells LLP (set forth in Exhibit 5.1)
23.2 Consent of PricewaterhouseCoopers, LLP
23.3 -- Consent of Deloitte & Touche LLP
23.4 -- Consent of Deloitte & Touche LLP
24.1 -- Power of Attorney (set forth on first signature page
hereof)
99.1 -- Hearst-Argyle Television, Inc. 1998 Employee Stock
Purchase Plan
Item 9. Undertakings
(a) 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, as amended (the"Act");
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this 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;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) shall
not apply to information contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), that are incorporated by reference in this
Registration Statement.
4
<PAGE>
(2) That, for the purpose of determining any liability under the Act,
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.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the 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 the employee benefit plan's annual report
pursuant to section 15(d) or the Exchange Act) that is incorporated by reference
in this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered herein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the 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 Securities and Exchange Commission such
indemnification is against public policy as expressed in the 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 Act and will be governed by the final adjudication of
such issue.
5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Company certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of New York, State of New York, on the 5th day of
April, 1999.
HEARST-ARGYLE TELEVISION, INC.
By:/s/ Bob Marbut
-------------------------
Bob Marbut
Chairman of the Board and
Co-Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN AND WOMEN BY THESE PRESENTS, that each person whose
signature appears below hereby constitutes and appoints Bob Marbut, Harry T.
Hawks and Dean H. Blythe, and each of them, such individual's true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution, for such individual and in his or her name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement on Form S-8 and any registration
statement for the same offering that is to be effective upon filing pursuant to
Rule 462(b) under the Securities Act of 1933, as amended, and any and all
applications and other documents in connection therewith, with the Securities
and Exchange Commission and any state or other securities authority, granting
unto said attorneys-in-fact and agents, and each of them, full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises as fully and to all intents and purposes as
he or she might or could do in person, hereby ratifying and confirming all that
said attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C> <C>
/s/ Bob Marbut Chairman of the Board and
- ----------------------- Co-Chief Executive Officer April 5, 1999
Bob Marbut (Principal Executive Officer)
President and Co-Chief
/s/ John G. Conomikes Executive Officer
- ----------------------- (Principal Executive Officer) April 5, 1999
John G. Conomikes
Executive Vice President,
/s/ David J. Barrett Chief Operating Officer and
- ----------------------- Director April 5, 1999
David J. Barrett
Chief Financial Officer,
/s/ Harry T. Hawks Senior Vice President and
- ----------------------- Principal Financial Officer April 5, 1999
Harry T. Hawks
/s/ Teresa Lopez Vice President and Controller
- ----------------------- (Principal Accounting Officer) April 5, 1999
Teresa Lopez
/s/ Frank A. Bennack, Jr.
- ----------------------- Director April 5, 1999
Frank A. Bennack, Jr.
/s/ Victor F. Ganzi
- ----------------------- Director April 5, 1999
Victor F. Ganzi
/s/ George R. Hearst, Jr.
- ----------------------- Director April 5, 1999
George R. Hearst, Jr.
/s/ William R. Hearst III
- ----------------------- Director April 5, 1999
William R. Hearst III
/s/ Gilbert C. Maurer
- ----------------------- Director April 5, 1999
Gilbert C. Maurer
/s/ David Pulver
- ----------------------- Director April 5, 1999
David Pulver
/s/ Virginia H. Randt
- ----------------------- Director April 5, 1999
Virginia H. Randt
/s/ Caroline L. Williams
- ----------------------- Director April 5, 1999
Caroline L. Williams
</TABLE>
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
4.1 -- Amended and Restated Certificate of Incorporation of
the Company (incorporated by reference to Appendix C of
the Company's Registration Statement on Form S-4 (File No.
333-32487))
4.2 -- Amended and Restated Bylaws of the Company
(incorporated by reference to Exhibit 3.2 of the Company's
Registration Statement on Form S-4 (File No. 333-72207))
4.3 -- Specimen of stock certificate for the Company's Series
A Common Stock, $.01 par value per share (incorporated by
reference to Exhibit 4.3 of the Company's Form 8-A/A dated
September 5, 1997)
5.1 -- Opinion of Rogers & Wells LLP
23.1 -- Consent of Rogers & Wells LLP (set forth in Exhibit 5.1)
23.2 Consent of PricewaterhouseCoopers, LLP
23.3 -- Consent of Deloitte & Touche LLP
23.4 -- Consent of Deloitte & Touche LLP
24.1 -- Power of Attorney (set forth on first signature page
hereof)
99.1 -- Hearst-Argyle Television, Inc. 1998 Employee Stock
Purchase Plan
<PAGE>
Exhibit 5.1
ROGERS & WELLS LLP
200 Park Avenue
New York, New York 10166
Telephone: 212.878.8000
Facsimile: 212.878.8375
April 5, 1999
Hearst-Argyle Television, Inc.
888 Seventh Avenue
New York, New York 10106
Re: Registration Statement on Form S-8
Ladies and Gentlemen:
We have acted as special counsel to Hearst-Argyle Television, Inc., a Delaware
corporation (the "Company"), in connection with the preparation and filing of
the Company's Registration Statement on Form S-8 (as the same may be amended or
supplemented from time to time, the "Registration Statement") with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended, covering 5,000,000 shares (the "Shares") of the Company's
Series A Common Stock, par value $0.01 per share (the "Common Stock"), which
have been reserved by the Company for issuance pursuant to the Company's 1998
Employee Stock Purchase Plan (the "Plan").
In rendering the opinions expressed herein, we have examined the Registration
Statement, the Company's Amended and Restated Certificate of Incorporation (the
"Charter") and the Company's Amended and Restated By-laws and such corporate
proceedings of the Company and such other documents as we have deemed necessary.
As to questions of fact material to this opinion, we have relied on certificates
of officers of the Company and have not independently verified the accuracy of
the matters contained therein.
In such examination, we have assumed the genuineness of all signatures, the
authenticity of all documents, certificates and instruments submitted to us as
originals, the conformity with originals of all documents submitted to us as
copies and the absence of any amendments or modifications to those items
reviewed by us.
In rendering the opinions set forth herein, we have assumed that (i) prior to
the issuance of any shares of Common Stock, there will exist under the Charter
the requisite number of authorized but unissued shares of Common Stock and (ii)
appropriate certificates representing shares of Common Stock will be executed
and delivered upon the issuance and sale of any such Shares, and that such
certificates will comply with all applicable requirements of Delaware law.
We have further assumed that (i) the grants under the Plan pursuant to which the
Shares are issuable will have been duly authorized and issued by the Company in
accordance with the terms and provisions of the Plan and in accordance with the
Charter and applicable Delaware law; (ii) the resolutions authorizing the
Company to issue the Shares in accordance with the terms and provisions of the
Plan will remain in effect and unchanged at all times during which the Shares
are issued by the Company; and (iii) the Registration Statement, and any
amendments thereto, at the time of issuance of the Shares, will continue to be
effective.
<PAGE>
Based upon the foregoing and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that the
Shares have been duly authorized and, upon issuance and delivery of the Shares
by the Company against payment therefor in accordance with the terms and
provisions of the Plan, such Shares will be validly issued, fully paid and
nonassessable by the Company.
The opinions stated herein are given as of the date hereof and are limited to
the federal laws of the United States, the laws of the State of New York and the
laws of the State of Delaware.
We hereby consent to the filing of this opinion with the Commission as an
exhibit to the Registration Statement. In giving this consent, we do not concede
that we are within the category of persons whose consent is required under the
Securities Act or the rules and regulations of the Commission promulgated
thereunder.
Very truly yours,
/s/ Rogers & Wells LLP
<PAGE>
EXHIBIT 23.2
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-8 of Hearst-Argyle
Television, Inc. of our report dated November 13, 1998, relating to the
financial statements of Kelly Broadcasting Co., which appear in Hearst-Argyle's
Current Report on Form 8-K dated January 20, 1999.
/s/ PRICEWATERHOUSECOOPERS LLP
Sacramento, California
April 5, 1999
<PAGE>
EXHIBIT 23.3
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Hearst-Argyle Television, Inc. on Form S-8 of our report dated July 17, 1998
(November 25, 1998 as to paragraph 3 of Note 1) relating to the financial
statements of Pulitzer Broadcasting Company and Subsidiaries, appearing in the
Current Report on Form 8-K of Hearst-Argyle Television, Inc. dated December 16,
1998, as amended.
/s/ Deloitte & Touche LLP
St. Louis, Missouri
April 5, 1999
<PAGE>
EXHIBIT 23.4
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Hearst-Argyle Television, Inc. on Form S-8 of our report dated February 19, 1999
(March 18, 1999 as to Note 18), appearing in the Annual Report on Form 10-K, of
Hearst-Argyle Television, Inc. for the year ended December 31, 1998.
/s/ DELOITTE & TOUCHE LLP
New York, New York
April 5, 1999
<PAGE>
EXHIBIT 99.1
HEARST-ARGYLE TELEVISION, INC.
1998 EMPLOYEE STOCK PURCHASE PLAN
The Company wishes to attract employees to the Company and its Subsidiaries and
to induce employees to remain with the Company and its Subsidiaries, and to
encourage them to increase their efforts to make the Company's business more
successful, whether directly or through its Subsidiaries. In furtherance
thereof, the Plan is designed to provide equity-based incentives to the eligible
employees of the Company and its Subsidiaries. The Plan is intended to comply
with the provisions of Section 423 of the Code and shall be administered,
interpreted and construed accordingly.
1. Definitions.
When used herein, the following terms shall have the respective meanings set
forth below:
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the committee appointed by the Board of Directors of the
Company under Section 3 hereof.
"Common Stock" means the Series A Common Stock, par value $0.01 per share, of
the Company.
"Company" means Hearst-Argyle Television, Inc., a Delaware corporation.
"Effective Date" means March 1, 1999.
"Eligible Compensation" for any pay period means, unless otherwise determined by
the Committee, the gross amount of base salary, incentive compensation,
overtime, bonuses, and other regular payments, with respect to which net amounts
are actually paid in cash in such pay period. Eligible Compensation does not
include, without limitation, any payments for reimbursement of expenses,
deferred compensation or other non-cash or non-regular payments, unless
otherwise determined by the Committee.
"Eligible Employee" means employees eligible to participate in the Plan pursuant
to the provisions of Section 4.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" per Share as of a particular date means (i) if Shares are
then listed on a national stock exchange, the closing sales price per Share on
the exchange for the last preceding date on which there was a sale of Shares on
such exchange, as determined by the Committee, (ii) if Shares are not then
listed on a national stock exchange but are then traded on an over-the-counter
market, the average of the closing bid and asked prices for the Shares in such
over-the-counter market for the last preceding date on which there was a sale of
such Shares in such market, as determined by the Committee, or (iii) if Shares
are not then listed on a national stock exchange or traded on an
over-the-counter market, such value as the Committee in its discretion may in
good faith determine; provided that, where the Shares are so listed or traded,
the Committee may make such discretionary determinations where the Shares have
not been traded for 10 trading days.
<PAGE>
"Investment Date" means the Friday coincident with or immediately preceding the
15th day of each calendar month.
"Participating Employee" means an employee (i) for whom payroll deductions are
currently being made or (ii) for whom payroll deductions are not currently being
made because he or she has reached the limitation set forth in Section 6.
"Payroll Account" means an account maintained by the Company with respect to
each Participating Employee as contemplated by Section 5.
"Plan" means this Hearst-Argyle Television, Inc. 1998 Employee Stock Purchase
Plan, as it may from time to time be amended.
"Plan Year" means the calendar year.
"Shares" means shares of Common Stock.
"Stock Account" means a brokerage account as contemplated by Section 8.
"Subsidiary" means any corporation that is a "subsidiary corporation" with
respect to the Company under Section 424(f) of the Code.
2. Shares Reserved for the Plan
There shall be reserved for issuance and purchase by employees under the Plan an
aggregate of 5,000,000 Shares, subject to adjustment as provided in Section 12.
Shares subject to the Plan may be Shares now or hereafter authorized but unused,
or Shares that were once issued and subsequently reacquired by the Company. If
and to the extent that any right to purchase reserved Shares shall not be
exercised by any employee for any reason or if such right to purchase shall
terminate as provided herein, Shares that have not been so purchased hereunder
shall again become available for the purposes of the Plan unless the Plan shall
have been terminated, but such unpurchased Shares shall not be deemed to
increase the aggregate number of Shares specified above to be reserved for
purposes of the Plan (subject to adjustment as provided in Section 12).
3. Administration of the Plan.
The Plan shall be administered by the Committee appointed by the Board of
Directors. The Committee shall consist of not less than two members of the Board
of Directors each of whom is a "non-employee director" within the terms of Rule
16b-3 promulgated under the Exchange and at such times as the Company is subject
to Section 162(m) of the Code (to the extent relief from the limitation of
Section 162(m) of the Code is sought with respect to Options), shall qualify as
"outside directors" for purposes of Section 162(m) of the Code. To the extent
that the Compensation Committee of the Board of Directors satisfies the
foregoing requirements, the Board of Directors may designate such Compensation
Committee to act as the Committee hereunder. Each member of the Committee shall
serve at the pleasure of the Board of Directors. The Committee may make such
rules and regulations and establish such procedures for the administration of
the Plan as it deems appropriate. The Committee shall have authority to
interpret the Plan, with such interpretations to be conclusive and binding on
all persons and otherwise accorded the maximum deference permitted by law and
shall take any other actions and make any other determinations or decisions that
it deems necessary or appropriate in connection with the Plan or the
administration or interpretation thereof.
2
<PAGE>
The acts of a majority of the members present at any meeting of the Committee at
which a quorum is present, or acts approved in writing by a majority of the
entire Committee, shall be the acts of the Committee for purposes of the Plan.
If and to the extent applicable, no member of the Committee may act as to
matters under the Plan specifically relating to such member.
4. Eligible Employees.
All employees of the Company and each Subsidiary designated for participation
herein by the Committee shall be eligible to participate in the Plan, provided
that each of such employees:
(i) is not in a group of highly compensated employees which, as
contemplated by Section 423(b)(4)(D) of the Code, has been
designated by the Committee as being ineligible to participate
in the Plan;
(ii) has been employed by the Company or any Subsidiary (or any
predecessor thereof) for a period of at least one year
(continuous or otherwise) prior to the Plan Year during which
participation is to commence;
(iii) does not own, for purposes of Section 423 of the Code,
immediately after the right is granted, stock possessing 5% or
more of the total combined voting power or value of all classes
of capital stock of the Company or of a Subsidiary; and
(iv) customarily works more than 20 hours per week;
(v) customarily works more than five months in a year;
provided, that, notwithstanding the foregoing, the employment of an employee of
a Subsidiary which ceases to be a Subsidiary shall, automatically and without
any further action, be deemed to have terminated (and such employee shall cease
to be an Eligible Employee hereunder).
The Committee may establish special rules with respect to those employees who
first satisfy (iv) or (v) above after they have already satisfied the other
requirements established by this Section 4 (with additional special rules to
apply in the discretion of the Committee in the case of employees with two years
of service with the Company at such time).
Prior service with Pulitzer Publishing Company and Kelly Broadcasting Company
and their subsidiaries shall be taken into account hereunder as service for the
Company for those employees employed thereby immediately before their being
affiliated with the Company and thereby or by the Company at the time of such
affiliation. The Committee may establish special rules with respect to the
eligibility of and the prior service credit for employees of other companies
which become affiliated with the Company prior to the Effective Date or during a
Plan Year.
3
<PAGE>
5. Election to Participate and Payroll Deductions.
Each Eligible Employee may elect to participate in the Plan during the
enrollment period immediately prior to the beginning of a Plan Year (or in the
case of the 1998 Plan Year, in the enrollment period preceding the effective
date of the Plan). Each Eligible Employee may elect a payroll deduction of from
1% to 10% of Eligible Compensation from each paycheck, in increments of 1%
(i.e., 1%, 2%, 3%, etc.). Elections under this Section 5 are subject to the
limits set forth in Section 6. All payroll deductions shall be credited, as
promptly as practicable, to a Payroll Account in the name of the Participating
Employee. All funds held by the Company under the Plan shall not be segregated
from other corporate funds (except that the Company may in its discretion
establish separate bank or investment accounts in its own name) and may be used
by the Company for any corporate purpose.
If so provided by the Committee, unless he or she elects otherwise during the
Enrollment Period for the Plan Year, an Eligible Employee who is a Participating
Employee on the day before a Plan Year commences will be deemed (i) to have
elected to participate in such Plan Year and (ii) to have authorized the same
percentage payroll deduction for such Plan Year as in effect for such employee
on the day before such Plan Year commences.
Each Participating Employee may, by signing and delivering written notice to the
Committee, on a form specified for such purpose by the Committee, at such times
as may be established by the Committee, cancel his or her election to
participate in the Plan and in such case the entire balance in the Payroll
Account of such Participating Employee shall be repaid to such Participating
Employee as promptly as practicable.
A Participating Employee who ceases to participate in a Plan Year shall not
again be eligible to participate during such Plan Year but, may elect to
participate in a subsequent Plan Year, if then eligible. A Participating
Employee may at any time during the Plan Year (but not more than four times)
decrease his or her payroll deductions by filing the required form with the
Company, which decrease shall become effective with the first pay period of the
first succeeding calendar month to which it may be practicably applied.
6. Limitation of Number of Shares That an Employee May Purchase.
No right to purchase Shares under the Plan shall permit an employee to purchase
stock under all employee stock purchase plans of the Company and its
subsidiaries (as defined for purposes of Section 423 of the Code) at a rate
which in the aggregate exceeds $25,000 of the fair market value of such stock
(determined under Section 423 of the Code at the time the right is granted,
which for purposes of the Plan, is deemed to be the Investment Date) for each
calendar year in which the right is outstanding at any time.
7. Purchase Price.
The purchase price for each Share shall be 85% of the Fair Market Value of such
Share on the Investment Date.
8. Method of Purchase.
As of each Investment Date, each Participating Employee shall be offered the
right to purchase, and shall be deemed, without any further action, to have
purchased, the number of whole and fractional Shares which the balance of his or
her Payroll Account at that time will purchase, determined by dividing the
balance in his or her Payroll Account not theretofore invested by the purchase
price as determined in Section 7.
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All Shares purchased as provided in the foregoing paragraph shall be initially
maintained in separate Stock Accounts for the Participating Employees at a
brokerage firm selected by, and pursuant to an arrangement with, the Company.
For so long as such Shares are maintained in Stock Accounts, all dividends paid
with respect to such Shares shall be credited to each Participating Employee's
Stock Account, and will be automatically reinvested in whole and fractional
Shares, unless the Participating Employee elects not to have such dividends
reinvested. Notwithstanding the foregoing, in the discretion of the Committee,
fractional Shares shall not be purchased hereunder, and any remaining cash in a
Participating Employee's Payroll Account resulting from such failure to invest
in fractional Shares shall be returned to the Participating Employee as soon as
practicable. The Committee may provide that transaction fees incurred with
respect to dividend reinvestment may be paid by the Company.
9. Title of Stock Accounts.
Each Stock Account may be in the name of the Participating Employee or, if
permitted by the Committee and the Participating Employee so indicates on the
appropriate form, in his or her name jointly with another person, with right of
survivorship. If permitted by the Committee, a Participating Employee who is a
resident of a jurisdiction that does not recognize such a joint tenancy may have
a Stock Account in his or her name as tenant in common with another person
without right of survivorship. In the event that a Participating Employee
directs that his or her Shares be transferred from the applicable Stock Account,
any fractional Shares in the Participating Employee's Stock Account shall be
paid in cash in accordance with the generally applicable rules and procedures of
the brokerage firm maintaining the Stock Accounts.
10. Rights as a Stockholder.
At the time funds from a Participating Employee's Payroll Account are used to
purchase the Common Stock, he or she shall have all of the rights and privileges
of a stockholder of the Company with respect to the Shares purchased under the
Plan whether or not certificates representing such Shares have been issued.
11. Rights Not Transferable.
Rights granted under the Plan are not transferable by a Participating Employee
other than by will or the laws of descent and distribution and are exercisable
during his or her lifetime only by him or her.
12. Adjustment in Case of Changes Affecting Common Stock.
If (i) the Company shall at any time be involved in a merger, consolidation,
dissolution, liquidation, reorganization, exchange of shares, sale of all or
substantially all of the assets or stock of the Company or its Subsidiaries or a
transaction similar thereto, (ii) any stock dividend, stock split, reverse stock
split, stock combination, reclassification, recapitalization or other similar
change in the capital structure of the Company, or any distribution to holders
of Common Stock other than cash dividends, shall occur or (iii) any other event
shall occur which in the judgment of the Committee necessitates action by way of
adjusting the number or kind of shares, or both, which thereafter may be sold
under the Plan, then the Committee may forthwith take any such action as in its
judgment shall be necessary to preserve to the Participating Employees' rights
substantially proportionate to the rights existing prior to such event, and to
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maintain the continuing availability of Shares under Section 2 (if Shares are
otherwise then available) in a manner consistent with the intent hereof,
including, without limitation, adjustments in (x) the number and kind of shares
subject to the Plan, (y) the purchase price of such shares under the Plan, and
(z) the number and kind of shares available under Section 2. To the extent that
such action shall include an increase or decrease in the number of Shares (or
units of other property then available) subject to the Plan, the number of
Shares (or units) available under Section 2 above shall be increased or
decreased, as the case may be, proportionately, as may be provided by Committee
in its discretion.
Notwithstanding any other provision of the Plan, if the Common Stock ceases to
be listed or traded, as applicable, on a national stock exchange or
over-the-counter market (a "Triggering Event"), then, in the discretion of the
Committee, (i) the balance in the Participating Employee's Payroll Account not
theretofore invested may be refunded to the Participating Employee, and such
Participating Employee shall have no further rights or benefits under the Plan,
(ii) an amount equal to the product of the Fair Market Value of a Share on the
date of the Triggering Event multiplied by the number of Shares such
Participating Employee would have been able to purchase with the balance of his
or her Payroll Account on such Triggering Event if such Triggering Event were
the Investment Date may be paid to the Participating Employee, and such
Participating Employee shall have no further rights or benefits under the Plan,
or (iii) the Plan may be continued without regard to the application of this
sentence.
13. Termination of Employment.
In the event of a Participating Employee's termination of employment during a
Plan Year (regardless of the reason therefor and regardless of the party
initiating the termination), the balance in the Participating Employee's Payroll
Account not theretofore invested, shall be refunded to him or her, and in the
event of his or her death shall be paid to his or her estate, any such refund or
payment to be made as soon as practicable after the next Investment Date.
14. Amendment of the Plan.
The Board of Directors may at any time, or from time to time, amend the Plan in
any respect; provided, however, that the Plan may not be amended in any way that
would cause, if such amendment were not approved by the holders of Common Stock,
the Plan to fail to comply with
(i) the requirements for employee stock purchase plans as
defined in Section 423 of the Code; or
(ii) any other requirement of applicable law or regulation;
unless and until the approval of the holders of the applicable Common Stock is
obtained. No amendment of the Plan shall alter or impair any rights outstanding
at the time of the such amendment to purchase Shares pursuant to any offer
hereunder.
15. Termination of the Plan.
The Plan and all rights of employees hereunder shall terminate:
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(i) on the Investment Date that Participating Employees
become entitled to purchase a number of Shares
greater than the number of reserved Shares remaining
available for purchase; or
(ii) at any time, at the discretion of the Board of Directors.
In the event that the Plan terminates under circumstances described in (i)
above, reserved Shares remaining as of the termination date shall be subject to
Participating Employees on a pro rata basis. No termination of the Plan shall
alter or impair any rights outstanding at the time of the such termination to
purchase Shares pursuant to any offering of the right to purchase Shares
hereunder.
16. Governmental and Other Regulations; Further Assurances.
The Plan, and the grant and exercise of the rights to purchase Shares hereunder,
and the Company's obligation to sell and deliver Shares upon the exercise of
rights to purchase Shares, shall be subject to all applicable federal, state and
foreign laws, rules and regulations, and to such approvals by any regulatory or
governmental agency as may be required. The Company shall not be required to
issue or deliver any certificates for Shares prior to the completion of any
registration or qualification of such Shares under, and the obtaining of any
approval under or compliance with, any state or federal law, or any ruling or
regulation of any government body which the Company shall, in its sole
discretion, determine to be necessary or advisable. Certificates for Shares
issued hereunder may be legended as the Committee may deem appropriate.
The Participating Employee shall take whatever additional actions and execute
whatever additional documents the Committee may in its reasonable judgment deem
necessary or advisable in order to carry out or effect one or more of the
obligations or restrictions imposed on the Participating Employee pursuant to
the Plan.
17. Indemnification of Committee.
The Company shall indemnify and hold harmless the members of the Board of
Directors of the Company and the members of the Committee from and against any
and all liabilities, costs and expenses incurred by such persons as a result of
any act or omission to act in connection with the performance of such person's
duties, responsibilities and obligations under the Plan if such person acts in
good faith and in a manner that he or she reasonably believes to be in, or not
opposed to, the best interests of the Company, to the maximum extent permitted
by law.
18. Withholding; Disqualifying Dispositions.
Notwithstanding any other provision of the Plan, the Company shall deduct from
all Payroll Accounts paid under the Plan all federal, state, local and other
taxes required by law to be withheld with respect to such payments.
If Shares acquired under the Plan are disposed of in a disqualifying disposition
within the meaning of Section 422 of the Code by a Participating Employee prior
to the expiration of two years from the Investment Date on which such Shares are
purchased, or in any other disqualifying disposition within the meaning of
Section 422 of the Code, such Participating Employee shall notify the Company in
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writing as soon as practicable thereafter of the date and terms of such
disposition and, if the Company (or any affiliate thereof) thereupon has a
tax-withholding obligation, shall pay to the Company (or such affiliate) an
amount equal to any withholding tax the Company (or affiliate) is required to
pay as a result of the disqualifying disposition.
19. Notices.
All notices under the Plan shall be in writing, and if to the Company, shall be
delivered to the Board of Directors or mailed to its principal office, addressed
to the attention of the Board of Directors; and if to a Participating Employee,
shall be delivered personally or mailed to such Participating Employee at the
address appearing in the records of the Company. Such addresses may be changed
at any time by written notice to the other party given in accordance with this
Section 19.
20. Severability.
The invalidity or unenforceability of any provision of the Plan shall not affect
the validity or enforceability of any other provision of the Plan, which shall
remain in full force and effect.
21. No Right to Continued Employment.
The Plan and any right to purchase Common Stock granted hereunder shall not
confer upon any employee any right with respect to continued employment by the
Company or any Subsidiary, nor shall they restrict or interfere in any way with
the right of the Company or any Subsidiary by which an employee is employed to
terminate his or her employment at any time.
22. Captions.
The use of captions in the Plan is for convenience. The captions are not
intended to and do not provide substantive rights.
23. Effective Date of the Plan.
The Plan shall be effective as of the Effective Date. If the Plan is not
approved by a vote of the holders of a majority of the total outstanding Common
Stock within one year following the Effective Date, the Committee shall be
authorized to take such action as it may deem appropriate in light of any
failure of the Plan to satisfy Section 423 of the Code.
24. Governing Law.
THE PLAN SHALL BE GOVERNED BY THE LAWS OF DELAWARE.
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