INDEMNITY AGREEMENT (the “Agreement”), dated as of May 1, 2000, between THE HERALD COMPANY, INC., a New York corporation (“Herald” or the “Indemnitor”), and PULITZER INC., a Delaware corporation (“Pulitzer”). Capitalized terms used but not otherwise defined herein shall have the respective meanings given to such terms in the Joint Venture Agreement or the Operating Agreement, each referred to below.
WHEREAS, Pulitzer, Herald, Pulitzer Technologies, Inc. (“PTI”) and St. Louis Post-Dispatch LLC, a Delaware limited liability company (the “Company”), are parties to a Joint Venture Agreement, dated as of May 1, 2000 (the “Joint Venture Agreement”);
WHEREAS, Pulitzer, PTI and Herald are parties to the Operating Agreement of the Company, dated as of May 1, 2000 (the “Operating Agreement”);
WHEREAS, the Company is a party to a Credit Agreement, dated as of May 1, 2000, between the Company and The Prudential Insurance Company of America and certain other institutional lenders (collectively, the “Lenders”), as amended, supplemented or otherwise modified from time to time (the “Credit Agreement”), pursuant to which the Lenders have agreed to make a loan to the Company in the principal amount of $306,000,000 (the “Company Debt”);
WHEREAS, the Company has executed a promissory note, dated as of May 1, 2000, evidencing the Company Debt;
WHEREAS, Pulitzer has provided to the Lenders a full and unconditional guaranty of payment of the Company Debt pursuant to a Guaranty Agreement, dated as of May 1, 2000 (the “Pulitzer Guaranty”);
WHEREAS, as contemplated by and as more fully described in Section 3.12 of the Operating Agreement, the parties thereto intend that the Company Debt will be refinanced on one or more occasions with Permanent Company Debt (as defined in the Operating Agreement); and
WHEREAS, the Indemnitor has agreed to indemnify Pulitzer against amounts that may be actually paid by Pulitzer under the Pulitzer Guaranty, subject to the terms and limitations set forth herein.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. INDEMNITY.
(a) Subject to Sections 3 and 4 hereof, the Indemnitor unconditionally agrees to indemnify Pulitzer for any payments of principal and interest with respect to the Company Debt that Pulitzer may make under the Pulitzer Guaranty, and any reasonable costs and expenses incurred by Pulitzer in connection with Indemnitor’s performance of its obligations under this Agreement, if Pulitzer shall have (i) exhausted all of its rights (whether by subrogation or otherwise) to reimbursement or recovery from the Company or the Company’s assets and (ii) assigned its Interest (as defined in the Operating Agreement), and caused PTI and all other Affiliates of Pulitzer to assign their Interests, to Herald (or to an Affiliate of Herald designated by Herald). Such indemnification payment shall be made within 30 days after the Indemnitor’s receipt of written notice from Pulitzer of Pulitzer’s right to such payment.
(b) For purposes of this Agreement, the term “Company Debt” shall include any Permanent Company Debt; the term “Credit Agreement” shall include any similar agreement entered into by the Company in respect of any Permanent Company Debt; and the term “Pulitzer Guaranty” shall include any similar agreement entered into by Pulitzer in connection with any Permanent Company Debt.
SECTION 2. SUBROGATION.
(a) Upon the Indemnitor’s payment in full to Pulitzer pursuant to Section 1(a) hereof, the Indemnitor shall be subrogated to the remaining rights of Pulitzer against the Company to the extent of such payment. For purposes of the Operating Agreement, on the day such payment is made, the Indemnitor shall be treated as if it contributed an amount equal to the amount of the payment to the capital of the Company.
(b) Notwithstanding any provision of applicable Law, the Indemnitor hereby agrees that the assignment by Pulitzer, PTI and any other Affiliate of Pulitzer of their respective Interests to Herald pursuant to Section 1(a) above shall constitute full satisfaction of any and all claims and other rights (whether legal or equitable) that Indemnitor may have or thereafter acquire against Pulitzer, the Company, any Member of the Company or any other Person by reason of making a payment pursuant to Section 1(a) hereof (other than any rights under the Operating Agreement in respect of the deemed capital contribution described in Section 2(a) above), including, without limitation, any right of indemnification, subrogation, reimbursement, exoneration, or contribution or any right to participate in any claim or remedy of the Lenders or