Exhibit 10.1
EXECUTION COPY
DISTRIBUTION
AGREEMENT
By and Among
TMCT, LLC,
TRIBUNE COMPANY,
CANDLE HOLDINGS
CORPORATION,
FORTIFY HOLDINGS
CORPORATION,
CHANDLER TRUST NO.
1,
and
CHANDLER TRUST
NO.2
September 21, 2006
DISTRIBUTION
AGREEMENT
This Distribution Agreement (the
“Agreement”), dated as of September 21, 2006, is by and
among TMCT, LLC, a Delaware limited liability company (the
“Company”), Tribune Company, a Delaware corporation
(“Tribune”), Candle Holdings Corporation, a Delaware
corporation (“Candle”), Fortify Holdings Corporation, a
Delaware corporation (“Fortify” and, collectively with
Tribune and Candle, the “Tribune Members”), Chandler
Trust No. 1 (“Trust 1”) and Chandler Trust No. 2
(“Trust 2” and, collectively with Trust 1, the
“Trust Members”). The Tribune Members and the
Trust Members are collectively referred to herein as the
“Members.” Capitalized terms used herein but not
otherwise defined shall have the meanings ascribed to them in the
Limited Liability Company Agreement of the Company, dated as of
August 8, 1997 (the “Operating Agreement”).
R E C I T A L S
WHEREAS, the Company desires to make a distribution to
Tribune (the “Distribution”); and
WHEREAS , concurrently with the Distribution, the
Members desire to amend and restate the Operating
Agreement.
A G R E E M E N T
NOW, THEREFORE
, in consideration of the mutual
promises, covenants and conditions hereinafter set forth, and other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
Distribution
1.1
Distribution . On the Closing Date
(as defined below), the Company shall make a distribution to
Tribune in respect of the Interest held by Tribune by delivering to
Tribune (a) certificates representing 9,719,780 shares of the
common stock, $.01 par value per share, of Tribune (the
“Common Stock”) and (b) certificates representing
442,596 shares of the Series C Preferred Stock, no par value, of
Tribune (the “Preferred Stock). All such shares shall
be distributed, transferred and delivered to Tribune free and clear
of any lien (statutory or other), claim, charge, security interest,
pledge, hypothecation, assignment, conditional sale or other title
retention agreement, preference, priority or other security
agreement or preferential arrangement of any kind or nature.
Concurrently with the Distribution, the Members will enter into an
Amended and Restated Limited Liability Company Agreement for the
Company in the form attached hereto as Exhibit A (the
“Amended Operating Agreement”). Each of the
Members acknowledges and agrees that the sole interest of such
Member in the Company following the Closing Date shall be the
Interest of such Member as provided in, and governed by, the terms
of the Amended Operating Agreement.
1.2
Consent to Transactions . For all purposes of
the Operating Agreement, including, without limitation, Section 6.5
of the Operating Agreement, each of the Members hereby agrees and
consents to the transactions described in this
Agreement,
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including,
without limitation, the Distribution. Each of the Members
further agrees to execute and deliver the Amended Operating
Agreement in order to carry out the purpose and intent of this
Agreement. Each of the Members (other than Tribune)
acknowledges that the Distribution provided for in this Agreement
is being made solely to Tribune and hereby waives any right it may
have to receive a concurrent distribution in accordance with the
provisions of Article IX of the Operating Agreement due to or
on account of the Distribution.
1.3
Continuation of Company . Each of the Members
hereby agrees that at all times relevant hereto the Company shall
continue and shall not be dissolved or deemed dissolved or
terminated due to or on account of the Distribution or any of the
transactions herein or any other reason. Each of the Members
agrees that it will not claim or assert in any forum a position
which is contrary to the purpose and intent of this Section
1.3.
ARTICLE II
Closing
2.1
Closing Date and Location . Subject to the
provisions of this Agreement, the closing of the transactions
contemplated hereby (the “Closing”) shall be held on
September 22, 2006 or at such other time on or before September 22,
2006 as may be mutually agreed upon in writing by the
parties. The date of the Closing is sometimes referred to
herein as the “Closing Date.” The Closing shall
take place at the Offices of Gibson, Dunn & Crutcher LLP, 333
South Grand Avenue, Los Angeles, California
90071.
2.2
Deliveries by the Tribune Members . In addition to, and
without limiting any other provision of this Agreement, the Tribune
Members agree to deliver or cause to be delivered to the Company
and the Trust Members at or prior to the Closing the
following:
(a)
Authorizations . Certified resolutions
of the Board of Directors of each of the Tribune Members
authorizing the execution, delivery and performance of this
Agreement and the transactions contemplated herein; and
(b)
Amended Operating Agreement . A copy of the Amended
Operating Agreement duly executed by each of the Tribune
Members.
2.3
Deliveries by the Company In addition to, and
without limiting any other provision of this Agreement, the Company
agrees to deliver or cause to be delivered at or prior to the
Closing the share certificates to Tribune described in Section 1.1,
in the amounts and at the times indicated in Section 1.1, together
with any stock or other applicable powers, duly executed on behalf
of the Company, as may be necessary to register the transfer of the
shares represented by such certificates.
2.4
Deliveries by the Trust Members In addition to, and
without limiting any other provision of this Agreement, the Trust
Members agree to deliver or cause to be
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delivered to the
Company and the Tribune Members at or prior to the Closing a copy
of the Amended Operating Agreement duly executed by each of the
Trust Members.
2.5
Conditions Precedent .
(a)
Conditions to Obligations of the Company .
The
obligation of the Company to consummate the transactions provided
for hereby are subject to the satisfaction, on or prior to the
Closing Date, of each of the following conditions, any of which may
be waived by the Company: (i) the representations and
warranties made by the Members herein shall be true and correct in
all material respects as of the date hereof and (ii) the Members
shall have performed and complied with all agreements, obligations
and conditions contained in this Agreement that are required to be
performed or complied with by the Members hereunder through and
including the Closing Date, and shall have obtained all approvals,
consents and qualifications necessary to complete the transactions
described herein.
(b)
Conditions to Obligations of the Tribune Members .
The
obligation of the Tribune Members to consummate the transactions
provided for hereby are subject to the satisfaction, on or prior to
the Closing Date, of each of the following conditions, any of which
may be waived by the Tribune Members: (i) the representations
and warranties made by the Company and the Trust Members herein
shall be true and correct in all material respects as of the date
hereof and (ii) the Company and the Trust Members shall have
performed and complied with all agreements, obligations and
conditions contained in this Agreement that are required to be
performed or complied with by the Company and the Trust Members
hereunder through and including the Closing Date, and shall have
obtained all approvals, consents and qualifications necessary to
complete the transactions described herein.
(c)
Conditions to Obligations of the Trust Members .
The
obligation of the Trust Members to consummate the transactions
provided for hereby are subject to the satisfaction, on or prior to
the Closing Date, of each of the following conditions, any of which
may be waived by the Trust Members: (i) the representations
and warranties made by the Company and the Tribune Members herein
shall be true and correct in all material respects as of the date
hereof and (ii) the Company and the Tribune Members shall have
performed and complied with all agreements, obligations and
conditions contained in this Agreement that are required to be
performed or complied with by the Company and the Tribune Members
hereunder through and including the Closing Date, and shall have
obtained all approvals, consents and qualifications necessary to
complete the transactions described herein.
ARTICLE III
Representations And
Warranties
3.1
Representations and Warranties of Tribune Members .
Each of
the Tribune Members, jointly and severally, represents and warrants
to the Company and the Trust Members as follows:
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(a)
Organization and Good Standing . Each of the Tribune
Members is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and has all
requisite corporate power and authority to own its properties and
assets and to carry on its business as now conducted and as
presently proposed to be conducted.
(b)
Due Authorization . All corporate action
on the part of each of the Tribune Members, its officers, directors
and stockholders necessary for the authorization, execution and
delivery of, and the performance of all obligations of such Tribune
Member under, this Agreement has been taken. Each of the
Tribune Members has duly authorized, executed and delivered this
Agreement, and this Agreement is a valid and binding obligation of
each of the Tribune Members enforceable in accordance with its
terms, subject, as to enforcement of remedies, to applicable
bankruptcy, insolvency, moratorium, reorganization and similar laws
affecting creditors’ rights generally and to general
equitable principles.
(c)
No Conflicts . Neither the execution
and delivery of this Agreement or the consummation of any of the
transactions contemplated hereby, nor compliance with or
fulfillment of the terms, conditions and provisions hereof, by any
of the Tribune Members will conflict with, result in a breach of
the terms, conditions or provisions of, or constitute a default, an
event of default or an event creating rights of acceleration,
termination or cancellation or a loss of rights under (a) the
certificate of incorporation, by-laws or other constitutional
documents of such Tribune Member (b) any material agreement, note,
instrument, mortgage, lease, license, franchise, permit or other
authorization, right, restriction or obligation to which such
Tribune Member is a party or any of its respective assets or
business is subject or by which such Tribune Member is bound, (c)
any order, writ, injunction or decree to which such Tribune Member
is a party or any of its assets or business is subject or by which
such Tribune Member is bound or (d) any applicable laws affecting
such Tribune Member or its respective assets or
business.
(d)
Consents . No consent, approval or
authorization of, declaration to, or filing or registration with,
any governmental or regulatory authority, or any other person, is
required to be made or obtained by the Tribune Members or any of
their affiliates in connection with the execution, delivery and
performance by the Tribune Members of this Agreement and the
consummation of the transactions contemplated hereby, other than
filings that Tribune may make pursuant to the requirements of the
Securities Exchange Act of 1934, as amended.
(e)
Representations of Tribune as Managing Member
.
(i)
Financial Statements . Tribune heretofore
has delivered to the Members true and correct copies of (A) the
Company’s audited balance sheets dated as of December 31,
2004 and December 31, 2005 and (B) the related statements of the
Member’s capital accounts for each of the years ended
December 31, 2004 and December 31, 2005 (collectively, the
“Financial Statements”). The Financial Statements
(1) have been prepared in all respects in accordance with the terms
of the Operating Agreement (except that all Financial Statements
have been prepared on a tax basis not in accordance
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with generally
accepted accounting principles), (2) are in accordance with the
books and records of the Company and (3) fairly present the
financial position of the Company as of the respective dates
thereof. The Company keeps books, records and accounts that,
in reasonable detail, accurately and fairly reflect in all material
respects the transactions and dispositions of assets of the
Company.
(ii)
Schedule of Members . Attached hereto as
Exhibit B is a true, complete and accurate copy of the Schedule of
Members as of the date hereof as required by the Operating
Agreement.
(iii)
Compliance with Operating Agreement . To the knowledge of
Tribune, since January 1, 2005, the Company has been operated in
compliance with the Operating Agreement in all material
respects.
(iv)
Tax Elections . No election under
Section 754 of the Internal Revenue Code of 1986, as amended (the
“Code”), is in effect with respect to the
Company.
(f)
Rights Plan . None of the transactions
contemplated hereby, or the direct or indirect acquisition of
beneficial ownership of additional securities of Tribune by the
Company or the Trust Members as a result of the consummation of the
transactions contemplated hereby, shall cause either of the Trust
Members or the Company to be an “Acquiring Person”
pursuant to that certain Rights Agreement, between Tribune and
First Chicago Trust Company of New York, dated as of December 12,
1997 and as amended by Amendment No. 1 on June 12, 2000 and
Amendment No. 2 on September 21, 2006 (the “Rights
Plan”).
3.2
Representations and Warranties of Trust Members .
Each of
the Trust Members, jointly and severally, represents and warrants
to the Company and the Tribune Members as follows:
(a)
Due Authorization . All action on the
part of each of the Trust Members and its trustees necessary for
the authorization, execution and delivery of, and the performance
of all obligations of such Trust Members under, this Agreement has
been taken. Each of the Trust Members has duly authorized,
executed and delivered this Agreement, and this Agreement is a
valid and binding obligation of each of the Trust Members
enforceable in accordance with its terms, subject, as to
enforcement of remedies, to applicable bankruptcy, insolvency,
moratorium, reorganization and similar laws affecting
creditors’ rights generally and to general equitable
principles.
(b)
No Conflicts . Neither the execution
and delivery of this Agreement or the consummation of any of the
transactions contemplated hereby, nor compliance with or
fulfillment of the terms, conditions and provisions hereof, by any
of the Trust Members will conflict with, result in a breach of the
terms, conditions or provisions of, or constitute a default, an
event of default or an event creating rights of acceleration,
termination or cancellation or a loss of rights under (a) the
constitutional documents of such Trust Member, (b) any material
agreement, note, instrument, mortgage, lease, license, franchise,
permit or other authorization, right, restriction or
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obligation to
which such Trust Member is a party or any of its respective assets
or business is subject or by which such Trust Member is bound, (c)
any order, writ, injunction or decree to which such Trust Members
is a party or any of its assets or business is subject or by which
such Trust Members is bound or (d) any applicable laws affecting
such Trust Members or its respective assets or
business.
(c)
Consents . No consent, approval or
authorization of, declaration to, or filing or registration with,
any governmental or regulatory authority, or any other person, is
required to be made or obtained by the Trust Members or any of
their affiliates in connection with the execution, delivery and
performance by the Trust Members of this Agreement and the
consummation of the transactions contemplated hereby.
(d)
Lack of Knowledge of Certain Actions . To the knowledge of
each Trust Member (i) the Company, since January 1, 2005, has
been o
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