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EXHIBIT 1.1
EXECUTION VERSION
$175,000,000
NETWORK COMMUNICATIONS, INC.
10 3/4% SENIOR NOTES DUE 2013
PURCHASE AGREEMENT
November 22, 2005
CREDIT SUISSE FIRST BOSTON LLC,
TD SECURITIES (USA) LLC,
c/o Credit Suisse First Boston LLC
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1.
Introductory. Network Communications, Inc., a Georgia corporation
(the
"COMPANY"), proposes, subject to the terms and conditions stated
herein, to
issue and sell to the several initial purchasers named in Schedule
A hereto (the
"INITIAL PURCHASERS") U.S.$175,000,000 principal amount of its 10
3/4% Senior
Notes due 2013 ("OFFERED SECURITIES") to be issued under an
indenture dated as
of November 30, 2005 (the "INDENTURE"), between the Company and
Wells Fargo
Bank, N.A., as trustee (the "TRUSTEE"). The United States
Securities Act of 1933
is herein referred to as the "SECURITIES ACT."
The
holders of the Offered Securities will be entitled to the benefits
of a
Registration Rights Agreement, dated as of the Closing Date (as
defined below),
among the Company and the Initial Purchasers (the "Registration
Rights
Agreement"), pursuant to which the Company agrees to file a
registration
statement with the Securities Exchange Commission (the
"Commission") registering
the resale of the Offered Securities under the Securities Act.
The
Company hereby agrees with the several Initial Purchasers as
follows:
2.
Representations and Warranties of the Company. The Company
represents
and warrants to, agrees with, the several Initial Purchasers
that:
(a) A preliminary offering circular and an offering circular
relating
to
the Offered Securities to be offered by the Initial Purchasers have
been
prepared by the Company. Such preliminary offering circular
(the
"PRELIMINARY OFFERING CIRCULAR") and offering circular (the
"OFFERING
CIRCULAR"), as supplemented as of the date of this Agreement,
are
hereinafter collectively referred to as the "OFFERING DOCUMENT".
The
Offering Document does not and will not include any untrue
statement of a
material fact or omit to state any material fact necessary in order
to make
the
statements therein, in the light of the circumstances under which
they
were
made, not misleading. The preceding sentence does not apply to
statements in or omissions from the Offering Document based upon
written
information furnished to the Company by any Initial Purchaser
through
Credit Suisse First Boston LLC ("CSFB") specifically for use
therein, it
being understood and agreed that the only such information is
that
described as such in Section 7(b) hereof.
(b) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of
Georgia, with
power and authority (corporate and other) to
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own
its properties and conduct its business as described in the
Offering
Document; and the Company is duly qualified to do business as a
foreign
corporation in good standing in all other jurisdictions in which
its
ownership or lease of property or the conduct of its business
requires such
qualification, except where the failure to so qualify would not
have a
Material Adverse Effect (as defined below).
(c) Each subsidiary of the Company has been duly incorporated and
is
an
existing corporation in good standing under the laws of the
jurisdiction
of
its incorporation, with power and authority (corporate and other)
to own
its
properties and conduct its business as described in the
Offering
Document; and each subsidiary of the Company is duly qualified to
do
business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the
conduct of
its
business requires such qualification (except where the failure to
so
qualify would not have a Material Adverse Effect); all of the
issued and
outstanding capital stock of
each subsidiary of the Company has been duly
authorized and validly issued and is fully paid and nonassessable;
and the
capital stock of each subsidiary owned by the Company, directly or
through
subsidiaries, is owned free from liens, encumbrances and
defects.
(d) The Indenture has been duly authorized; the Offered
Securities
have
been duly authorized; and when the Offered Securities are delivered
by
the
Company and paid for pursuant to this Agreement on the Closing
Date,
the
Indenture will have been duly executed and delivered by the
Company,
such
Offered Securities will have been duly executed, authenticated,
issued
and
delivered and will conform to the description thereof contained in
the
Offering Document and the Indenture and such Offered Securities
will
constitute valid and legally binding obligations of the
Company,
enforceable in accordance with their terms, subject to
bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and
similar
laws
of general applicability relating to or affecting creditors'
rights
and
to general equity principles.
(e) No consent, approval, authorization, or order of, or filing
with,
any
governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement and
the
Registration Rights Agreement in connection with the issuance and
sale of
the
Offered Securities except for the order of the Commission declaring
the
Exchange Offer Registration Statement or the Shelf Registration
Statement
(each as defined in the Registration Rights Agreement)
effective.
(f) The execution, delivery and performance of the Indenture,
this
Agreement and the Registration Rights Agreement, and the issuance
and sale
of
the Offered Securities and compliance with the terms and
provisions
thereof will not result in a breach or violation of any of the
terms and
provisions of, or constitute a default under (i) any statute, any
rule,
regulation or order of any governmental agency or body or any
court,
domestic or foreign, having jurisdiction over the Company or any
subsidiary
of
the Company or any of their properties, (ii) any agreement or
instrument
to
which the Company or any such subsidiary is a party or by which
the
Company or any such subsidiary is bound or to which any of the
properties
of
the Company or any such subsidiary is subject, or (iii) the charter
or
by-laws of the Company or any such subsidiary, and the Company has
full
power and authority to authorize, issue and sell the Offered
Securities as
contemplated by this Agreement, except, in the case of clauses (ii)
and
(iii), any breach, violation or default that would not,
individually or in
the
aggregate, have a Material Adverse Effect
(g) This Agreement and the Registration Rights Agreement have
been
duly
authorized, executed and delivered by the Company. When the
Registration Rights Agreement has been duly executed and delivered,
the
Registration Rights Agreement will be a valid and binding agreement
of the
Company, enforceable against the Company in accordance with its
terms,
subject to bankruptcy, insolvency, fraudulent transfer,
reorganization,
moratorium and similar laws of general
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applicability relating to or affecting creditors' rights and to
general
equity principles. On the Closing Date, the Registration Rights
Agreement
will
conform as to legal matters to the description thereof in the
Offering
Circular.
(h) Except as disclosed in the Offering Document, the Company and
its
subsidiaries have good and marketable title to all real properties
and all
other properties and assets owned by them, in each case free from
liens,
encumbrances and defects that would materially affect the value
thereof or
materially interfere with the use made or to be made thereof by
them; and
except as disclosed in the Offering Document, the Company and
its
subsidiaries hold any leased real or personal property under valid
and
enforceable leases with no exceptions that would materially
interfere with
the
use made or to be made thereof by them.
(i) The Company and its subsidiaries possess adequate
certificates,
authorities or permits issued by appropriate governmental agencies
or
bodies necessary to conduct the business now operated by them and
have not
received any notice of proceedings relating to the revocation
or
modification of any such certificate, authority or permit that,
if
determined adversely to the Company or any of its subsidiaries,
would
individually or in the aggregate have a material adverse effect on
the
condition (financial or other), business, properties or results
of
operations of the Company and its subsidiaries taken as a whole
("MATERIAL
ADVERSE EFFECT").
(j) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent
that
would individually or in the aggregate have a Material Adverse
Effect.
(k) The Company and its subsidiaries own, possess or can acquire
on
reasonable terms, adequate trademarks, trade names and other rights
to
inventions, know-how, patents, copyrights, confidential information
and
other intellectual property (collectively, "INTELLECTUAL PROPERTY
RIGHTS")
necessary to conduct the business now operated by them, or
presently
employed by them, and have not received any notice of infringement
of or
conflict with asserted rights of others with respect to any
intellectual
property rights that, if determined adversely to the Company or any
of its
subsidiaries, would individually or in the aggregate have a
Material
Adverse Effect.
(l) Except as disclosed in the Offering Document, neither the
Company
nor
any of its subsidiaries is in violation of any statute, rule,
regulation, decision or order of any governmental agency or body or
any
court, domestic or foreign, relating to the use, disposal or
release of
hazardous or toxic substances or relating to the protection or
restoration
of
the environment or human exposure to hazardous or toxic
substances
(collectively, "ENVIRONMENTAL LAWS"), owns or operates any real
property
contaminated with any substance that is subject to any
environmental laws,
is
liable for any off-site disposal or contamination pursuant to
any
environmental laws, or is subject to any claim relating to any
environmental laws, which violation, contamination, liability or
claim
would individually or in the aggregate have a Material Adverse
Effect; and
the
Company is not aware of any pending investigation which might lead
to
such
a claim.
(m) Except as disclosed in the Offering Document, there are no
pending
actions, suits or proceedings against or affecting the Company, any
of its
subsidiaries or any of their respective properties that, if
determined
adversely to the Company or any of its subsidiaries, would
individually or
in
the aggregate have a Material Adverse Effect, or would materially
and
adversely affect the ability of the Company to perform its
obligations
under the Indenture, this Agreement or the Registration Rights
Agreement,
or
which are otherwise material in the context of the sale of the
Offered
Securities; and no such actions, suits or proceedings are
threatened or, to
the
Company's knowledge, contemplated.
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(n) The financial statements included in the Offering Document
present
fairly in all material respects the financial position of the
Company and
its
consolidated subsidiaries as of the dates shown and their results
of
operations and cash flows for the periods shown, and such
financial
statements have been prepared in conformity with the generally
accepted
accounting principles in the United States applied on a consistent
basis;
and
the assumptions used in preparing the pro forma financial
statements
included in the Offering Document provide a reasonable basis for
presenting
the
significant effects directly attributable to the transactions or
events
described therein, the related pro forma adjustments give
appropriate
effect to those assumptions, and the pro forma columns therein
reflect the
proper application of those adjustments to the corresponding
historical
financial statement amounts.
(o) Except as disclosed in the Offering Document, since the date
of
the
latest audited financial statements included in the Offering
Document
there has been no material adverse change, nor any development or
event
involving a prospective material adverse change, in the
condition
(financial or other), business, properties or results of operations
of the
Company and its subsidiaries taken as a whole, and, except as
disclosed in
or
contemplated by the Offering Document, there has been no dividend
or
distribution of any kind declared, paid or made by the Company on
any class
of
its capital stock.
(p) The Company is not an open-end investment company, unit
investment
trust or face-amount certificate company that is or is required to
be
registered under Section 8 of the United States Investment Company
Act of
1940
(the "INVESTMENT COMPANY ACT"); and the Company is not and,
after
giving effect to the offering and sale of the Offered Securities
and the
application of the proceeds thereof as described in the Offering
Document,
will
not be an "investment company" as defined in the Investment
Company
Act.
(q) No securities of the same class (within the meaning of Rule
144A(d)(3) under the Securities Act) as the Offered Securities are
listed
on any national
securities exchange registered under Section 6 of the
Exchange Act or quoted in a U.S. automated inter-dealer quotation
system.
(r) The offer and sale of the Offered Securities in the manner
contemplated by this Agreement will be exempt from the
registration
requirements of the Securities Act by reason of Section 4(2)
thereof and
Regulation S thereunder; and it is not necessary to qualify an
indenture in
respect of the Offered Securities under the United States Trust
Indenture
Act
of 1939, as amended (the "TRUST INDENTURE ACT"). No registration
under
the
Securities Act of the Offered Securities is required for the sale
of
the
Offered Securities and such guarantees to the Initial Purchasers
as
contemplated hereby or for exempt resales assuming the accuracy of
the
Initial Purchaser's representations set forth in Section 4
hereof.
(s) Neither the Company, nor any of its affiliates, nor any
person
acting on its or their behalf (i) has, within the six-month period
prior to
the
date hereof, offered or sold in the United States or to any U.S.
person
(as
such terms are defined in Regulation S under the Securities Act)
the
Offered Securities or any security of the same class or series as
the
Offered Securities or (ii) has offered or will offer or sell the
Offered
Securities (A) in the United States by means of any form of
general
solicitation or general advertising within the meaning of Rule
502(c) under
the
Securities Act or (B) with respect to any such securities sold
in
reliance on Rule 903 of Regulation S ("REGULATION S") under the
Securities
Act,
by means of any directed selling efforts within the meaning of
Rule
902(c) of Regulation S. The Company, its affiliates and any person
acting
on
its or their behalf have complied and will comply with the
offering
restrictions requirement of Regulation S. The Company has not
entered and
will
not enter into any contractual arrangement with respect to the
distribution of the Offered Securities except for this
Agreement.
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(t) The entities listed on Schedule B hereto are the only
subsidiaries, direct or indirect, of the Company.
(u) On the Closing Date, the Indenture will conform in all
material
respects to the requirements of the Trust Indenture Act, and the
rules and
regulations of the Commission applicable to an indenture which is
qualified
thereunder.
(v) On the Closing Date, the Exchange Securities (as defined in
the
Registration Rights Agreement) will have been duly authorized by
the
Company; and when the Exchange Securities are issued, executed
and
authenticated in
accordance with the terms of the Exchange Offer (as
defined in the Registration Rights Agreement) and the Indenture,
the
Exchange Securities will be entitled to the benefits of the
Indenture and
will
be the valid and legally binding obligations of the Company,
enforceable in accordance with their terms, subject to
bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and
similar
laws
of general applicability relating to or affecting creditors'
rights
and
to general equity principles.
(w) The Registration Rights Agreement has been duly authorized by
the
Company and, on the Closing Date, will have been duly executed
and
delivered by the Company.
(x) Neither the Company nor any of its subsidiaries is in violation
of
its
respective charter or by-laws 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 or any of its subsidiaries is a party or by which the
Company
or
any of its subsidiaries or their respective property is bound.
(y) Except as disclosed in the Offering Document, there are no
contracts, agreements or understandings between the Company and any
person
granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to
any
securities of the Company or to require the Company to include
such
securities with the Securities registered pursuant to any
Registration
Statement.
(z) Neither the Company nor any of its subsidiaries nor any
agent
thereof acting on the behalf of them has taken, and none of them
will take,
any
action that might cause this Agreement or the issuance or sale of
the
Offered Securities to violate Regulation T, Regulation U or
Regulation X of
the
Board of Governors of the Federal Reserve System.
(aa) No "nationally recognized statistical rating organization"
as
such
term is defined for purposes of Rule 436(g)(2) under the
Securities
Act
(i) has imposed (or has informed the Company that it is
considering
imposing) any condition (financial or otherwise) on the Company's
retaining
any
rating assigned to the Company, any securities of the Company or
(ii)
has
indicated to the Company that it is considering (a) the
downgrading,
suspension, or withdrawal of, or any review for a possible change
that does
not
indicate the direction of the possible change in, any rating so
assigned or (b) any change in the outlook for any rating of the
Company or
any
securities of the Company.
(bb) No form of general solicitation or general advertising (as
defined in Regulation D under the Securities Act) was used by the
Company
or
any of its respective representatives (other than the Initial
Purchasers, as to whom the Company make no representation) in
connection
with
the offer and sale of the Offered Securities contemplated
hereby,
including, but not limited to, articles, notices or other
communications
published in any
newspaper, magazine, or similar medium or broadcast over
television or radio, or any seminar or meeting whose attendees
have
5
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been
invited by any general solicitation or general advertising. No
securities of the same class as the Offered Securities have been
issued and
sold
by the Company within the six-month period immediately prior to
the
date
hereof.
(cc) None of the Company nor any of its affiliates or any
person
acting on its or their behalf (other than the Initial Purchasers,
as to
whom
the Company make no representation) has engaged or will engage in
any
directed selling efforts within the meaning of Regulation S with
respect to
the Offered
Securities.
(dd) The Offered Securities offered and sold in reliance on
Regulation
S
have been and will be offered and sold only in offshore
transactions.
(ee) The sale of the Offered Securities pursuant to Regulation S
is
not
part of a plan or scheme to evade the registration provisions of
the
Securities Act.
3.
Purchase, Sale and Delivery of Offered Securities. On the basis of
the
representations, warranties and agreements herein contained, but
subject to the
terms and conditions herein set forth, the Company agrees to sell
to the Initial
Purchasers, and the Initial Purchasers agree, severally and not
jointly, to
purchase from the Company, at a purchase price of 95.941% of the
principal
amount thereof plus accrued interest from November 30, 2005 to the
Closing Date
(as hereinafter defined), the respective principal amounts of
Securities set
forth opposite the names of the several Initial Purchasers in
Schedule A hereto.
The
Company will deliver against payment of the purchase price the
Offered
Securities in the form of one or more permanent global Securities
in definitive
form (the "GLOBAL SECURITIES") deposited with the Trustee as
custodian for The
Depository Trust Company ("DTC") and registered in the name of Cede
& Co., as
nominee for DTC. Interests in any permanent global Securities will
be held only
in book-entry form through DTC, except in the limited circumstances
described in
the Offering Document. Payment for the Offered Securities shall be
made by the
Initial Purchasers in Federal (same day) funds by official check or
checks or
wire transfer to an account at a bank acceptable to CSFB drawn to
the order of
the Company at the office of Cravath, Swaine & Moore LLP,
Worldwide Plaza, 825
Eighth Avenue, New York, N.Y. 10019 at 9:00 A.M. (New York time),
on November
30, 2005, or at such other time not later than seven full business
days
thereafter as CSFB and the Company determine, such time being
herein referred to
as the "CLOSING DATE", against delivery to the Trustee as custodian
for DTC of
the Global Securities representing all of the Offered Securities.
The Global
Securities will be made available for checking at the above office
of Cravath,
Swaine & Moore LLP at least 24 hours prior to the Closing
Date.
4.
Representations by Initial Purchasers; Resale by Initial
Purchasers. (a)
Each Initial Purchaser severally represents and warrants to the
Company that it
is an "accredited investor" within the meaning of Regulation D
under the
Securities Act.
(b) Each Initial Purchaser severally acknowledges that the
Offered
Securities have not been registered under the Securities Act and
may not be
offered or sold within the United States or to, or for the account
or
benefit of, U.S. persons except in accordance with Regulation S or
pursuant
to
an exemption from the registration requirements of the Securities
Act.
Each
Initial Purchaser severally represents and agrees that it has
offered
and
sold the Offered Securities, and will offer and sell the
Offered
Securities (i) as part of its distribution at any time and (ii)
otherwise
until 40 days after the later of the commencement of the offering
and the
Closing Date, only in accordance with Rule 903 or Rule 144A under
the
Securities Act ("RULE 144A"). Accordingly, neither such Initial
Purchaser
nor
its affiliates, nor any persons acting on its or their behalf,
have
engaged or will engage in any directed selling efforts with respect
to the
Offered Securities, and such Initial Purchaser, its affiliates and
all
persons acting on its or their behalf have complied and will comply
with
the
offering restrictions requirement of Regulation S. Each Initial
Purchaser
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severally agrees that, at or prior to confirmation of sale of the
Offered
Securities, other than a sale pursuant to Rule 144A, such Initial
Purchaser
will
have sent to each distributor, dealer or person receiving a
selling
concession, fee or other remuneration that purchases the Offered
Securities
from
it during the restricted period a confirmation or notice to
substantially the following effect:
"The Securities covered hereby have not been registered under the
U.S.
Securities Act of 1933 (the "Securities Act") and may not be
offered
or sold within the United States or to, or for the account or
benefit
of, U.S. persons (i) as part of their distribution at any time or
(ii)
otherwise until 40 days after the later of the date of the
commencement of the offering and the closing date, except in
either
case in accordance with Regulation S (or Rule 144A if available)
under
the Securities Act. Terms used above have the meanings given to
them
by Regulation S."
Terms used in this subsection (b) have the meanings given to them
by
Regulation S.
(c) Each Initial Purchaser severally agrees that it and each of
its
affiliates has not entered and will not enter into any
contractual
arrangement with respect to the distribution of the Offered
Securities
except for any such arrangements with the other Initial Purchasers
or
affiliates of the other Initial Purchasers or with the prior
written
consent of the Company.
(d) Each Initial Purchaser severally agrees that it and each of
its
affiliates will not offer or sell the Offered Securities in the
United
States by means of any form of general solicitation or general
advertising
within the meaning of Rule 502(c) under the Securities Act,
including, but
not
limited to (i) any advertisement, article, notice or other
communication published in any newspaper, magazine or similar media
or
broadcast over television or radio, or (ii) any seminar or meeting
whose
attendees have been invited by any general solicitation or
general
advertising. Each Initial Purchaser severally agrees, with respect
to
resales made in reliance on Rule 144A of any of the Offered
Securities, to
deliver either with the confirmation of such resale or otherwise
prior to
settlement of such resale a notice to the effect that the resale of
such
Offered Securities has been made in reliance upon the exemption
from the
registration requirements of the Securities Act provided by Rule
144A.
(e) Each of the Initial Purchasers severally represents and
agrees
that
(i) it has not offered or sold and prior to the expiry of a period
of
six
months from the closing date, will not offer or sell any
Offered
Securities to persons in the United Kingdom except to persons
whose
ordinary activities involve them in acquiring, holding, managing
or
disposing of investments (as principal or agent) for the purposes
of their
businesses or otherwise in circumstances which have not resulted
and will
not
result in an offer to the public in the United Kingdom within
the
meaning of the Public Offers of Securities Regulations 1995; (ii)
it has
only
communicated or caused to be communicated and will only communicate
or
cause to be communicated any invitation or inducement to engage
in
investment activity (within the meaning of section 21 of the
Financial
Services and Markets Act 2000 (the "FSMA")) received by it in
connection
with
the issue or sale of any Offered Securities in circumstances in
which
section 21(1) of the FSMA does not apply to the Issuer; and (iii)
it has
complied and will comply with all applicable provisions of the FSMA
with
respect to anything done by it in relation to the Offered
Securities in,
from
or otherwise involving the United Kingdom
5.
Certain Agreements of the Company. The Company agrees with the
several
Initial Purchasers that:
(a) The Company will advise CSFB promptly of any proposal to amend
or
supplement the Offering Document and will not effect such amendment
or
supplementation without CSFB's
7
<PAGE>
consent. If, at any time prior to the completion of the resale of
the
Offered Securities by the Initial Purchasers, any event occurs as a
result
of
which the Offering Document as then amended or supplemented
would
include an untrue statement of a material fact or omit to state
any
material fact necessary in order to make the statements therein, in
the
light of the circumstances under which they were made, not
misleading, the
Company promptly will notify the Initial Purchasers of such event
and
promptly will prepare, at its own expense, an amendment or
supplement which
will
correct such statement or omission. Neither CSFB's consent to, nor
the
Initial Purchasers' delivery to offerees or investors of, any
such
amendment or supplement shall constitute a waiver of any of the
conditions
set
forth in Section 6.
(b) The Company will furnish to the Initial Purchasers copies of
any
preliminary offering
circular, the Offering Document and all amendments and
supplements to such documents, in each case as soon as available
and in
such
quantities as the Initial Purchasers reasonably request. The
Company
will
promptly furnish or cause to be furnished to the Initial
Purchasers
and,
upon request of holders and prospective purchasers of the
Offered
Securities, to such holders and purchasers, copies of the
information
required to be delivered to holders and prospective purchasers of
the
Offered Securities pursuant to Rule 144A(d)(4) under the Securities
Act (or
any
successor provision thereto) in order to permit compliance with
Rule
144A
in connection with resales by such holders of the Offered
Securities.
The
Company will pay the expenses of printing and distributing to
the
Initial Purchasers all such documents.
(c) The Company will use reasonable best efforts to permit the
qualification of the Offered Securities for sale and the
determination of
their eligibility for investment under the laws of such
jurisdictions in
the
United States and Canada as CSFB designates and to continue
such
qualifications in effect so long as required for the resale of the
Offered
Securities by the Initial Purchasers, provided that the Company
will not be
required to qualify as a foreign corporation or to file a general
consent
to
service of process in any such state.
(d) During the period of three years hereafter, the Company
will
furnish to the Initial Purchasers, as soon as practicable after the
end of
each
fiscal year, a copy of its annual report to stockholders for
such
year; and the Company will furnish to the Initial Purchasers (i) as
soon as
available, a copy of each report, notice or communication sent
to
securityholders or, if applicable, filed with foreign regulators
or
securities exchanges, and (ii) from time to time, such other
information
concerning the Company as CSFB may reasonably request.
(e) During the period of two years after the Closing Date, the
Company
will, upon request, furnish to the Initial Purchasers and any
holder of
Offered Securities a copy of the restrictions on transfer
applicable to the
Offered Securities.
(f) During the period of two years after Closing Date, the
Company
will
not, and will not permit any of its affiliates (as defined in Rule
144
under the Securities Act) to, resell any of the Offered Securities
that
have
been reacquired by any of them.
(g) During the period of two years after the Closing Date, the
Company
will
not be or become, an open-end investment company, unit
investment
trust or face-amount certificate company that is or is required to
be
registered under Section 8 of the Investment Company Act.
(h) The Company will pay all expenses incidental to the performance
of
its
obligations under this Agreement, the Indenture and the
Registration
Rights Agreement, including (i) the fees and expenses of the
Trustee and
its
professional advisers; (ii) all expenses in connection with the
execution, issue, authentication, packaging and initial delivery of
the
Offered Securities and, as applicable, the Exchange Securities (as
defined
in
the Registration Rights Agreement), the preparation
8
<PAGE>
and
printing of this Agreement, the Registration Rights Agreement,
the
Offered Securities, the Indenture, the Offering Document and
amendments and
supplements thereto, and any other document relating to the
issuance,
offer, sale and delivery of the Offered Securities and as
applicable, the
Exchange Securities; (iii) the cost of qualifying the Offered
Securities
for
trading in The PORTAL (SM) Market ("PORTAL") and any expenses
incidental thereto; (iv) the reasonable cost of any advertising
approved by
the
Company in connection with the issue of the Offered Securities (v)
for
any
reasonable expenses (including fees and disbursements of
counsel)
incurred in connection with qualification of the Offered Securities
or the
Exchange Securities for sale under the laws of such jurisdictions
in the
United States and Canada as CSFB designates and the printing of
memoranda
relating thereto, (vi) for any fees charged by investment rating
agencies
for
the rating of the Securities or the Exchange Securities, and (vii)
for
reasonable expenses incurred in distributing preliminary offering
circulars
and
the Offering Document (including any amendments and supplements
thereto) to the Initial Purchasers. The Company will also pay or
reimburse
the
Initial Purchasers (to the extent incurred by them) for all
reasonable
travel expenses of the Initial Purchasers and the Company's
officers and
employees and any other expenses of the Initial Purchasers and the
Company
in
connection with attending or hosting meetings with prospective
purchasers of the Offered Securities from the Initial
Purchasers.
(i) In connection with the offering, until CSFB shall have
notified
the
Company and the other Initial Purchasers of the completion of
the
resale of the Offered Securities, neither the Company nor any of
its
affiliates has or will, either alone or with one or more other
persons, bid
for
or purchase for any account in which it or any of its affiliates
has a
beneficial interest any Offered Securities or attempt to induce any
person
to
purchase any Offered Securities; and neither it nor any of its
affiliates will make bids or purchases for the purpose of creating
actual,
or
apparent, active trading in, or of raising the price of, the
Offered
Securities.
(j) For a period of 180 days after the date of the initial offering
of
the
Offered Securities by the Initial Purchasers, the Company will
not
offer, sell, contract to sell, pledge or otherwise dispose of,
directly or
indirectly, or file with the Commission a registration statement
under the
Securities Act relating to, any United States dollar-denominated
debt
securities issued or guaranteed by the Company and having a
maturity of
more
than one year from the date of issue, or publicly disclose the
intention to make any such offer, sale, pledge, disposition or
filing,
without the prior written consent of CSFB. The Company will not at
any time
offer, sell, contract to sell, pledge or otherwise dispose of,
directly or
indirectly, any securities under circumstances where such offer,
sale,
pledge, contract or disposition would cause the exemption afforded
by
Section 4(2) of the Securities Act or the safe harbor of Regulation
S
thereunder to cease to be applicable to the offer and sale of the
Offered
Securities.
(k) The Company will use reasonable best efforts to permit the
Offered
Securities admitted to trading in PORTAL.
6.
Conditions of the Obligations of the Initial Purchasers. The
obligations
of the several Initial Purchasers to purchase and pay for the
Offered Securities
will be subject to the accuracy of me representations and
warranties on the part
of the Company herein, to the accuracy of the statements of
officers of the
Company made pursuant to the provisions hereof, to the performance
by the
Company of its obligations hereunder and to the following
additional conditions
precedent:
(a) The Initial Purchasers shall have received a letter dated the
date
of
this Agreement, from PricewaterhouseCoopers LLP in form and
substance
reasonably satisfactory to the Initial Purchasers and
PricewaterhouseCoopers LLP concerning the financial information
with
respect to the Company set forth in the Offering Document
9
<PAGE>
(b) Subsequent to the execution and delivery of this Agreement,
there
shall not have occurred (i) any change, or any development or
event
involving a prospective change, in the condition (financial or
other),
business, properties or results of operations of the Company and
its
subsidiaries taken as one enterprise which, in the judgment of
CSFB, is
material and adverse and makes it impractical or inadvisable to
proceed
with
completion of the offering or the sale of and payment for the
Offered
Securities; (ii) any downgrading in the rating of any debt
securities of
the
Company by any "nationally recognized statistical rating
organization"
(as
defined for purposes of Rule 436(g) under the Securities Act), or
any
public announcement that any such organization has under
surveillance or
review its rating of any debt securities of the Company (other than
an
announcement with positive implications of a possible upgrading,
and no
implication of a possible downgrading, of such rating) or any
announcement
that
the Company has been placed on negative outlook; (iii) any change
in
U.S.
or international financial, political or economic conditions or
currency exchange rates or exchange controls as would, in the
judgment of
CSFB, be likely to prejudice materially the success of the proposed
issue,
sale
or distribution of the Offered Securities, whether in the
primary
market or in respect of dealings in the secondary market, (iv) any
material
suspension or material limitation of trading in securities
generally on the
New
York Stock Exchange, or any setting of minimum prices for trading
on
such
exchange; (v) or any suspension of trading of any securities of
the
Company on any exchange or in the over-the-counter market; (vi) any
banking
moratorium declared by U.S. Federal or New York authorities; (vii)
any
major disruption of settlements of securities or clearance services
in the
United States or (viii) any attack on, outbreak or escalation
of
hostilities or act of terrorism involving the United States,
any
declaration of war by Congress or any other national or
international
calamity or emergency if, in the judgment of CSFB, the effect of
any such
attack, outbreak, escalation, act, declaration, calamity or
emergency makes
it
impractical or inadvisable to proceed with completion of the
offering or
sale
of and payment for the Offered Securities.
(c) The Initial Purchasers shall have received an opinion, dated
the
Closing Date, of Kirkland & Ellis LLP, counsel for the Company,
reasonably
acceptable to Cravath, Swaine & Moore LLP and the Initial
Purchasers,
substantially in the Form of Exhibit A attached hereto.
(d) The Initial Purchasers shall have received an opinion, dated
the
Closing Date, of (i) Epstein Becker & Green, P.C., special
Georgia counsel
for
the Company, substantially in the form of Exhibit B-l hereto and
(ii)
Susan Deese, Senior Vice President and General Counsel of the
Company,
substantially in the form of Exhibit B-2 hereto.
(e) The Initial Purchasers shall have received from Cravath, Swaine
&
Moore LLP, counsel for the Initial Purchasers, such opinion or
opinions,
dated the Closing Date, with respect to the incorporation of the
Company,
the
validity of the Offered Securities, the Offering Circular, the
exemption from registration for the offer and sale of the
Offered
Securities by the Company to the several Initial Purchasers and the
resales
by
the several Initial Purchasers as contemplated hereby and other
related
matters as CSFB may require, and the Company shall have furnished
to such
counsel such documents as they request for the purpose of enabling
them to
pass
upon such matters. In rendering such opinion, Cravath, Swaine &
Moore
LLP may rely as to the
incorporation of the Company and all other matters
governed by Georgia law upon the opinion of Kilpatrick Stockton
LLP
referred to above.
(f) (i) The Initial Purchasers shall have received a certificate
dated
the
Closing Date, of the President or any Vice President and a
principal
financial or accounting officer of the Company in which such
officers, to
the
best of their knowledge after reasonable investigation, shall
state
that
the representations and warranties of the Company in this
Agreement
are
true and correct, that the Company has complied with all agreements
and
satisfied all conditions on its part to be performed or satisfied
hereunder
at
or prior to the Closing Date, and that, subsequent to the date of
the
most
10
<PAGE>
recent financial statements in the Offering Document there has been
no
material adverse change, nor any development or event involving
a
prospective material adverse change, in the condition (financial or
other),
business, properties or results of operations of the Company and
its
subsidiaries taken as a whole except as set forth in the Offering
Document
or
as described in such certificate.
(ii) The Initial Purchasers shall have received a certificate
dated the Closing Date, of the Chief Financial Officer of the
Company
substantially in the form of Exhibit C hereto.
(g) The Initial Purchasers shall have received a letter dated
the
Closing Date, of PricewaterhouseCoopers LLP which meets the
requirements of
subsection (a) of this Section, except that the specified date
referred to
in
such subsection will be a date not more than three days prior to
the
Closing Date for the purposes of this subsection.
The
Company will furnish the Initial Purchasers with such conformed
copies
of such opinions, certificates, letters and documents as the
Initial Purchasers
reasonably request. CSFB may in its sole discretion waive
compliance with any
conditions to the obligations of the Initial Purchasers hereunder,
whether in
respect of the Closing Date or otherwise.
7.
Indemnification and Contribution. (a) The Company will indemnify
and
hold harmless each Initial Purchaser, its officers, partners,
members, directors
and its affiliates and each person, if any, who controls such
Initial Purchaser
within the meaning of Section 15 of the Securities Act or Section
20(a) of the
Exchange Act, against any losses, claims, damages or liabilities,
joint or
several, to which such Initial Purchaser may become subject, under
the
Securities Act or the Exchange Act or otherwise, insofar as such
losses, claims,
damages or liabilities (or actions in respect thereof) arise out of
or are based
upon any untrue statement or alleged untrue statement of any
material fact
contained in the Offering Document, or any amendment or supplement
thereto, or
any related preliminary offering circular or arise out of or are
based upon the
omission or alleged omission to state therein a material fact
necessary in order
to make the statements therein, in the light of the circumstances
under which
they were made, not misleading, including any losses, claims,
damages or
liabilities arising out of or based upon the Company's failure to
perform its
obligations under Section 5(a) of this Agreement, and will
reimburse each
Initial Purchaser for any legal or other expenses reasonably
incurred by such
Initial Purchaser in connection with investigating or defending any
such loss,
claim, damage, liability or action as such expenses are incurred;
provided,
however, that the Company will not be liable in any such case to
the extent that
any such loss, claim, damage or liability arises out of or is based
upon an
untrue statement or alleged untrue statement in or omission or
alleged omission
from any of such documents in reliance upon and in conformity with
written
information furnished to the Company by any Initial Purchaser
through CSFB
specifically for use therein, it being understood and agreed that
the only such
information consists of the information described as such in
subsection (b)
below; and provided, further, that with respect to any untrue
statement or
alleged untrue statement in or omission or alleged omission from
any preliminary
offering circular, the indemnity agreement contained in this
subsection (a)
shall not inure to the benefit of any Initial Purchaser that sold
the Offered
Securities concerned to the person asserting any such losses,
claims, damages or
liabilities, to the extent that such sale was an initial resale by
such Initial
Purchaser and any such loss, claim, damage or liability of such
Initial
Purchaser results from the fact that there was not sent or given to
such person,
at or prior to the written confirmation of the sale of such Offered
Securities
to such person, a copy of the Offering Document if the Company had
previously
furnished copies thereof to such Initial Purchaser.
(b) Each Initial Purchaser will severally and not jointly
indemnify
and
hold harmless each of the Company, its directors and officers and
each
person, if any, who controls the Company within the meaning of
Section 15
of
the Securities Act or Section 20(a) of the Exchange Act, against
any
losses, claims, damages or liabilities to which the Company may
become
subject, under
11
<PAGE>
the
Securities Act or the Exchange Act or otherwise, insofar as
such
losses, claims,
damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged
untrue
statement of any material fact contained in the Offering Document,
or any
amendment or supplement thereto, or any related preliminary
offering
circular, or arise out of or are based upon the omission or the
alleged
omission to state therein a material fact necessary in order to
make the
statements therein, in the light of the circumstances under which
they were
made, not misleading, in each case to the extent, but only to the
extent,
that
such untrue statement or alleged untrue statement or omission
or
alleged omission was made in reliance upon and in conformity with
written
information furnished to the Company by such Initial Purchaser
through CSFB
specifically for use therein, and will reimburse any legal or
other
expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability
or
action as such expenses are incurred, it being understood and
agreed that
the
only such information furnished by any Initial Purchaser consists
of
the
information in the first sentence of paragraph three, the third
sentence of paragraph eight and paragraphs ten, eleven and twelve
of the
Offering Document, in each case, under the caption "Plan of
Distribution";
provided, however, that the Initial Purchasers shall not be liable
for any
losses, claims, damages or liabilities arising out of or based upon
the
Company's failure to perform its obligations under Section 5(a) of
this
Agreement.
(c) Promptly after receipt by an indemnified party under this
Section
of
notice of the commencement of any action, such indemnified party
will,
if a
claim in respect thereof is to be made against the indemnifying
party
under subsection (a) or (b) above, notify the indemnifying party of
the
commencement thereof; but the failure to notify the indemnifying
party
shall not relieve it from any liability that it may have under
subsection
(a)
or (b) above except to the extent that it has been materially
prejudiced (through the forfeiture of substantive rights or
defenses) by
such
failure; and provided further that the failure to notify the
indemnifying party shall not relieve it from any liability that it
may have
to
an indemnified party otherwise than under subsection (a) or (b)
above.
In case any such
action is brought against any indemnified party and it
notifies the indemnifying party of the commencement thereof,
the
indemnifying party will be entitled to participate therein and, to
the
extent that it may wish, jointly with any other indemnifying
party
similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with
the
consent of the indemnified party, be counsel to the indemnifying
party),
and
after notice from the indemnifying party to such indemnified party
of
its
election so to assume the defense thereof, the indemnifying party
will
not
be liable to such indemnified party under this Section for any
legal or
other expenses subsequently incurred by such indemnified party
in
connection with the defense thereof other than reasonable costs
of
investigation. It is understood that the indemnifying party shall
not, in
respect of the legal expenses of any indemnified party in
connection with
any
proceeding or related proceedings in the same jurisdiction, be
liable
for
the reasonable fees and expenses of more than one separate firm
of
legal counsel (in addition to any local counsel) for all such
indemnified
parties and that all such fees and expenses shall be reimbursed as
they are
incurred. No indemnifying party shall, without the prior written
consent of
the
indemnified party, effect any settlement of any pending or
threatened
action in respect of
which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such
indemnified
party unless such settlement includes (i) an unconditional release
of such
indemnified party from all liability on any claims that are the
subject
matter of such action and (ii) does not include a statement as to
or an
admission of fault, culpability or failure to act by or on behalf
of any
indemnified party.
(d) If the indemnification provided for in this Section is
unavailable
or
insufficient to hold harmless an indemnified party under subsection
(a)
or
(b) above, then each indemnifying party shall contribute to the
amount
paid
or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b)
above
(i)
in such
12
<PAGE>
proportion as is appropriate to reflect the relative benefits
received by
the
Company on the one hand and the Initial Purchasers on the other
from
the
offering of the Offered Securities or (ii) if the allocation
provided
by
clause (i) above is not permitted by applicable law, in such
proportion
as
is appropriate to reflect not only the relative benefits referred
to in
clause (i) above but also the relative fault of the Company on the
one hand
and
the Initial Purchasers on the other in connection with the
statements
or
omissions which resulted in such losses, claims, damages or
liabilities
as
well as any other relevant equitable considerations. The
relative
benefits received by the Company on the one hand and the Initial
Purchasers
on
the other shall be deemed to be in the same proportion as the total
net
proceeds from the offering (before deducting expenses) received by
the
Company bear to the total discounts, fees and commissions received
by the
Initial Purchasers from the Company under this Agreement The
relative fault
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 Initial Purchasers and the parties' relative
intent,
knowledge, access to information and opportunity to correct or
prevent such
untrue statement or omission. The amount paid by an indemnified
party as a
result of the losses, claims, damages or liabilities referred to in
the
first sentence of this subsection (d) shall be deemed to include
any legal
or
other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any action or claim
which is the
subject of this subsection (d). Notwithstanding the provisions of
this
subsection (d), no Initial Purchaser shall be required to
contribute any
amount in excess of the amount by which the total discounts, fees
and
commissions received by such
Initial Purchaser exceeds the amount of any
damages which such Initial Purchaser has otherwise been required to
pay by
reason of such untrue or alleged untrue statement or omission or
alleged
omission. The Initial Purchasers' obligations in this subsection
(d) to
contribute are several in proportion to their respective
purchase
obligations and not joint.
(e) The obligations of the Company under this Section shall be
in
addition to any liability which the Company may otherwise have and
shall
extend, upon the same terms and conditions, to each person, if any,
who
controls any Initial Purchaser within the meaning of the Securities
Act or
the
Exchange Act; and the obligations of the Initial Purchasers under
this
Section shall be in addition to any liability which the respective
Initial
Purchasers may otherwise have and shall extend, upon the same terms
and
conditions, to each person, if any, who controls the Company within
the
meaning of the Securities Act or the Exchange Act.
8.
Default of Initial Purchasers. If any Initial Purchaser or
Initial
Purchasers default in their obligations to purchase Offered
Securities hereunder
and the aggregate principal amount of Offered Securities that such
defaulting
Initial Purchaser or Initial Purchasers agreed but failed to
purchase does not
exceed 10% of the total principal amount of Offered Securities,
CSFB may make
arrangements satisfactory to the Company for the purchase of such
Offered
Securities by other persons, including any of the Initial
Purchasers, but if no
such arrangements are made by the Closing Date, the non-defaulting
Initial
Purchasers shall be obligated severally, in proportion to their
respective
commitments hereunder, to purchase the Offered Securities that such
defaulting
Initial Purchasers agreed but failed to purchase. If any Initial
Purchaser or
Initial Purchasers so default and the aggregate principal amount of
Offered
Securities with respect to which such default or defaults occur
exceeds 10% of
the total principal amount of Offered Securities and arrangements
satisfactory
to CSFB and The Company for the purchase of such Offered Securities
by other
persons are not made within 36 hours after such default, this
Agreement will
terminate without liability on the part of any non-defaulting
Initial Purchaser
or the Company, except as provided in Section 9. As used in this
Agreement, the
term "Initial Purchaser" includes any person substituted for an
Initial
Purchaser under this Section. Nothing herein will relieve a
defaulting Initial
Purchaser from liability for its default.
13
<PAGE>
9.
Survival of Certain Representations and Obligations. The
respective
indemnities, agreements, representations, warranties and other
statements of the
Company or their respective officers and of the several Initial
Purchasers set
forth in or made pursuant to this Agreement will remain in full
force and
effect, regardless of any investigation, or statement as to the
results thereof,
made by or on behalf of any Initial Purchaser, the Company or any
of their
respective representatives, officers or directors or any
controlling person, and
will survive delivery of and payment for the Offered Securities. If
this
Agreement is terminated pursuant to Section 8 or if for any reason
the purchase
of the Offered Securities by the Initial Purchasers is not
consummated, the
Company shall remain responsible for the expenses to be paid or
reimbursed by it
pursuant to Section 5 and the respective obligations of the Company
and the
Initial Purchasers pursuant to Section 7 shall remain in effect If
the purchase
of the Offered Securities by the Initial Purchasers is not
consummated for any
reason other than solely because of the termination of this
Agreement pursuant
to Section 8 or the occurrence of any event specified in clause
(iii), (iv),
(vi), (vii) or (viii) of Section 6(b), the Company will reimburse
the Initial
Purchasers for all out-of-pocket expenses (including fees and
disbursements of
counsel) reasonably incurred by them in connection with the
offering of the
Offered Securities.
10.
Notices. All communications hereunder will be in writing and, if
sent
to the Initial Purchasers, will be mailed, delivered or telegraphed
and
confirmed to the Initial Purchasers, c/o Credit Suisse First Boston
LLC, Eleven
Madison Avenue, New York, N.Y. 10010-3629, Attention: Transactions
Advisory
Group, or, if sent to the Company, will be mailed, delivered or
telegraphed and
confirmed to it at Network Communications, Inc., 2305 Newpoint
Parkway,
Lawrenceville, G.A. 30043, Attention: Susan Deese; provided,
however, that any
notice to an Initial Purchaser pursuant to Section 7 will be
mailed, delivered
or telegraphed and confirmed to such Initial Purchaser.
11.
Successors. This Agreement will inure to the benefit of and be
binding
upon the parties hereto and their respective successors and the
controlling
persons referred to in Section 7, and no other person will have any
right or
obligation hereunder, except that holders of Offered Securities
shall be
entitled to enforce the agreements for their benefit contained in
the second and
third sentences of Section 5(b) hereof against the Company as if
such holders
were parties thereto.
12.
Representation of Initial Purchasers. You will act for the
several
Initial Purchasers in connection with this purchase, and any action
under this
Agreement taken by you by CSFB will be binding upon all the Initial
Purchasers.
13.
Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but
all such
counterparts shall together constitute one and the same
Agreement.
14
<PAGE>
14.
Absence of Fiduciary Relationship. The Company acknowledges and
agrees
that:
(a) The Initial Purchasers have been retained solely to act as
initial
purchasers in connection with the sale of the Offered Securities
and that
no
fiduciary, advisory or agency relationship between the Company and
the
Initial Purchasers has been created in respect of any of the
transactions
contemplated by this Agreement, irrespective of whether the
Initial
Purchasers have advised or are advising the Company on other
matters;
(b) The price of the Offered Securities set forth in this
Agreement
was
established by the Company following discussions and
arms-length
negotiations with the Initial Purchasers and the Company is capable
of
evaluating and understanding and understands and accepts the terms,
risks
and
conditions of the transactions contemplated by this Agreement;
(c) It has been advised that the Initial Purchasers and their
affiliates are engaged in a broad range of transactions which may
involve
interests that differ from those of the Company and that the
Initial
Purchasers have no obligation to disclose such interests and
transactions
to
the Company by virtue of any fiduciary, advisory or agency
relationship;
and
(d) It waives, to the fullest extent permitted by law, any claims
it
may
have against the Initial Purchasers for breach of fiduciary duty
or
alleged breach of fiduciary duty and agrees that the Initial
Purchasers
shall have no liability (whether direct or indirect) to the Company
in
respect of such a fiduciary duty claim or to any person asserting
a
fiduciary duty claim on behalf of or in right of the Company,
including
stockholders, employees or creditors of the Company.
15.
APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES
OF CONFLICTS OF LAWS.
The
Company hereby submits to the non-exclusive jurisdiction of the
Federal
and state courts in the Borough of Manhattan in The City of New
York in any suit
or proceeding arising out of or relating to this Agreement or the
transactions
contemplated hereby.
<PAGE>
If the foregoing is in accordance with the Initial Purchasers'
understanding of
our agreement, kindly sign and return to the Company one of the
counterparts
hereof, whereupon it will become a binding agreement between the
Company and the
several Initial Purchasers in accordance with its terms.
Very truly yours,
NETWORK COMMUNICATIONS, INC.
By /s/ Gerard Parker
-------------------------------------
Name: Gerard Parker
Title: Chief Financial Officer
The foregoing Purchase Agreement is hereby confirmed and accepted
as of the date
first above written.
CREDIT SUISSE FIRST BOSTON LLC
TD SECURITIES (USA) LLC
By: CREDIT SUISSE FIRST BOSTON LLC
By /s/ Robert Kobre
----------------------------------
Name: Robert Kobre
Title: Managing Director
16
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT OF
INITIAL PURCHASER
OFFERED SECURITIES
-----------------
-------------------
<S>
<C>
Credit Suisse First Boston LLC.......
$140,000,000
TID Securities (USA) LLC..............
35,000,000
------------
TOTAL.............................
$175,000,000
============
</TABLE>
17
<PAGE>
SCHEDULE B
SUBSIDIARIES OF THE COMPANY
Network Publications Canada, Inc.
NCID,LLC
NCID (Austin) LLC
NCID (Seattle), LLC
NCID (Vegas), LLC
NCID (West Palm), LLC
18
<PAGE>
EXHIBIT A
FORM OF K&E OPINION
19
<PAGE>
K&E DRAFT DATED 11/23/05
November 30, 2005
CREDIT SUISSE FIRST BOSTON LLC,
TD SECURITIES (USA) LLC,
c/o Credit Suisse First Boston LLC
Eleven Madison
Avenue,
New York, N.Y.
10010-3629
Ladies and Gentlemen:
We have acted as special legal counsel to Network Communications,
Inc., a
Georgia corporation (the "Company"). This letter is being delivered
in response
to the requirement in Section 6(c) of the Purchase Agreement, dated
November 22,
2005 (the "Purchase Agreement"), among Credit Suisse First Boston
LLC and TD
Securities (USA) LLC, (the "Initial Purchasers") and the Company
relating to the
sale by the Company of $175,000,000 in aggregate principal amount
of the
Company's Senior Notes due 2013 (the "Securities") to be issued
under the
Indenture dated as of November 30, 2005 (the "Indenture") between
the Company
and Wells Fargo Bank, N.A., as trustee (the "Trustee").
The
Purchase Agreement, the Indenture, the Registration Rights
Agreement
(as defined below) and the Securities are collectively referred to
herein as the
"Transaction Documents." The Senior Notes due 2013 contemplated by
the
Registration Rights Agreement to be offered to holders of
Securities in exchange
for the Securities are referred to herein as the "Exchange
Securities." The
offer to exchange the Securities for the Exchange Securities as
contemplated by
the Registration Rights Agreement is referred to herein as the
"Exchange Offer."
The agreements listed on Schedule A hereto are collectively
referred to herein
as the "Specified Contracts" which term does not include any
agreements attached
as exhibits, schedules or attachments to or are otherwise referred
to in
agreements listed on Schedule A, but are not directly listed on
Schedule A.
In
connection with the preparation of this letter, we have among
other
things read:
(a)
the Offering Circular,
dated November 22, 2005, relating to the
offering and sale of the Securities (the "Offering Circular");
(b)
an executed copy of
the Purchase Agreement;
(c)
an executed copy of
the Indenture;
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(d)
an executed copy of
the Registration Rights Agreement, dated as of
November 30, 2005 between the Company and the Initial Purchasers
(the
Registration Rights Agreement");
(e)
a specimen certificate
of the Securities;
(f)
a copy of the
resolutions adopted by the Board of Directors of the
Company dated November 22, 2005;
(g)
copies of all
certificates and other documents delivered in connection
with the sale of the Securities on the date hereof and the
consummation of the other transactions contemplated by the
Purchase
Agreement;
(h)
copies of the
Specified Contracts; and
(i)
such other records,
certificates and documents as we have deemed
necessary or appropriate in order to deliver the opinions set
forth
herein.
Subject to the assumptions, qualifications, exclusions and
other
limitations which are identified in this letter, we advise you
that:
1. Assuming the
due authorization, execution and delivery thereof by the
Company and the Initial Purchasers, the Registration Rights
Agreement is a
valid and binding obligation of the Company, enforceable in
accordance with
its
terms.
2. Assuming the
due authorization, execution and delivery thereof by the
Company and the Trustee, the Indenture is a valid and binding
obligation of
the
Company, enforceable in accordance with its terms.
3. Assuming that
the Company's Board of Directors has adopted by requisite
vote
the resolutions necessary to authorize the Company's execution,
delivery and performance of the Transaction Documents to which the
Company
is a
party, when the Securities are paid for by the Initial Purchasers
in
accordance with the terms of the Purchase Agreement (assuming the
due
authentication and delivery of the Securities by the Trustee in
accordance
with
the Indenture), the Securities will constitute valid and
binding
obligations of the Company, enforceable against the Company in
accordance
with their terms and
entitled to the benefits of the Indenture.
4. Assuming that
the Company's Board of Directors has adopted by requisite
vote
the resolutions necessary to authorize the Exchange Securities,
when
the
Exchange Securities have been duly executed and delivered by
the
Company in accordance with the terms of the Registration Rights
Agreement,
the
Exchange Offer and the Indenture (assuming the
<PAGE>
due
authentication and delivery of the Exchange Securities by the
Trustee
in
accordance with the Indenture), the Exchange Securities will
constitute
the
valid and binding obligations of the Company, enforceable against
the
Company in accordance with their terms and entitled to the benefits
of the
Indenture.
5. The
Securities and the Indenture conform in all material respects to
the
descriptions thereof contained in the Offering Circular under the
heading
"Description of Notes."
6. The
statements in the Offering Circular under the heading "Certain
Material
United States Federal Income Tax Considerations" to the extent that
such
information summarizes laws, governmental rules or regulations,
fairly
summarizes in all material respects, such laws, rules and
regulations.
7. No consent,
approval, authorization or order of, or filing with, any court
or
governmental authority is required for the issuance and sale by
the
Company of the Securities to the Initial Purchasers or the
consummation by
the
Company of the other transactions contemplated by the
Transaction
Documents, except (i) such as may be required under the securities
or blue
sky
laws of the various states (and the rules and regulations
thereunder),
as
to which we express no opinion in this paragraph and (ii) solely
with
respect to the issuance of the Exchange Securities, such as may be
required
under the Securities Act of 1933, as amended (the "Securities
Act"), the
Exchange Act of 1934, as amended (the "Exchange Act"), the Trust
Indenture
Act
of 1939, as amended (the "TIA"), as to which we express no opinion
in
this
paragraph.
8. The
execution, delivery and performance by the Company of the T
