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Exhibit 4.1
EMMIS ESCROW CORPORATION
12-1/2% SENIOR DISCOUNT NOTES DUE 2011
INDENTURE
Dated as of March 27, 2001
The Bank of Nova Scotia Trust Company of New York
Trustee
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CROSS-REFERENCE TABLE
Trust Indenture
Act Section Indenture Section
310 (a)(1) ......................................................... 7.10
(a)(2) ......................................................... 7.10
(a)(3) ......................................................... N.A.
(a)(4) ......................................................... N.A.
(a)(5) ......................................................... 7.10
(b) ............................................................ 7.10
(c) ............................................................ N.A.
311 (a) ............................................................ 7.11
(b) ............................................................ 7.11
(c) ............................................................ N.A.
312 (a) ............................................................ 2.05
(b) ............................................................ 12.03
(c) ............................................................ 12.03
313 (a) ............................................................ 7.06
(b)(1) ......................................................... 10.02
(b)(2) ......................................................... 7.07
(c) ............................................................ 7.06; 12.02
(d) ............................................................ 7.06
314 (a) ............................................................ 4.03; 12.05
(c)(1) ......................................................... 12.04
(c)(2) ......................................................... 12.04
(c)(3) ......................................................... N.A.
(d) ............................................................ N.A.
(e) ............................................................ 11.05
(f) ............................................................ N.A.
315 (a) ............................................................ 7.01
(b) ............................................................ 7.05, 12.02
(c) ............................................................ 7.01
(d) ............................................................ 7.01
(e) ............................................................ 6.11
316 (a) (last sentence) ............................................ 2.09
(a)(1)(A) ...................................................... 6.05
(a)(1)(B) ...................................................... 6.04
(a)(2) ......................................................... N.A.
(b) ............................................................ 6.07
(c) ............................................................ 2.12
317 (a)(1) ......................................................... 6.08
(a)(2) ......................................................... 6.09
(b) ............................................................ 2.04
318 (a) ............................................................ 12.01
(b) ............................................................ N.A.
(c) ............................................................ 12.01
N.A. means not applicable.
* This Cross-Reference Table is not part of this Indenture.
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TABLE OF CONTENTS
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ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions ....................................................... 1
Section 1.02. Other Definitions ................................................. 24
Section 1.03. Incorporation by Reference of Trust Indenture Act ................. 25
Section 1.04. Rules of Construction ............................................. 25
ARTICLE 2 THE NOTES
Section 2.01. Form and Dating ................................................... 26
Section 2.02. Execution and Authentication ...................................... 27
Section 2.03. Registrar and Paying Agent ........................................ 28
Section 2.04. Paying Agent to Hold Money in Trust ............................... 28
Section 2.05. Holder Lists ...................................................... 28
Section 2.06. Transfer and Exchange ............................................. 29
Section 2.07. Replacement Notes ................................................. 44
Section 2.08. Outstanding Notes ................................................. 44
Section 2.09. Treasury Notes .................................................... 45
Section 2.10. Temporary Notes ................................................... 45
Section 2.11. Cancellation ...................................................... 45
Section 2.12. Defaulted Interest ................................................ 45
Section 2.13. The Investment Company Act ........................................ 46
ARTICLE 3 REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee ................................................ 46
Section 3.02. Selection of Notes to Be Redeemed ................................. 46
Section 3.03. Notice of Redemption .............................................. 47
Section 3.04. Effect of Notice of Redemption .................................... 47
Section 3.05. Deposit of Redemption Price ....................................... 48
Section 3.06. Notes Redeemed in Part ............................................ 48
Section 3.07. Optional Redemption ............................................... 48
Section 3.08. Mandatory Redemption .............................................. 49
Section 3.09. Offer to Purchase by Application of Excess Proceeds ............... 49
Section 3.10. Mandatory Exchange ................................................ 51
ARTICLE 4 COVENANTS
Section 4.01. Payment of Notes .................................................. 52
Section 4.02. Maintenance of Office or Agency ................................... 52
Section 4.03. Reports ........................................................... 53
Section 4.04. Compliance Certificate ............................................ 53
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Section 4.05. Taxes ............................................................. 54
Section 4.06. Stay, Extension and Usury Laws .................................... 54
Section 4.07. Restricted Payments ............................................... 54
Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries .... 58
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Stock ........ 60
Section 4.10. Asset Sales ....................................................... 62
Section 4.11. Transactions with Affiliates ...................................... 64
Section 4.12. Liens ............................................................. 66
Section 4.13. Corporate Existence ............................................... 66
Section 4.14. Offer to Repurchase Upon Change of Control ........................ 66
Section 4.15. Limitation on Issuances and Sales of Equity Interests in Wholly
Owned Subsidiaries .............................................. 67
Section 4.16. Calculation of Original Issue Discount ............................ 68
ARTICLE 5 SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets .......................... 68
Section 5.02. Successor Corporation Substituted ................................. 69
ARTICLE 6 DEFAULTS AND REMEDIES
Section 6.01. Events of Default ................................................. 69
Section 6.02. Acceleration ...................................................... 71
Section 6.03. Other Remedies .................................................... 72
Section 6.04. Waiver of Past Defaults ........................................... 72
Section 6.05. Control by Majority ............................................... 72
Section 6.06. Limitation on Suits ............................................... 73
Section 6.07. Rights of Holders of Notes to Receive Payment ..................... 73
Section 6.08. Collection Suit by Trustee ........................................ 73
Section 6.09. Trustee May File Proofs of Claim .................................. 74
Section 6.10. Priorities ........................................................ 74
Section 6.11. Undertaking for Costs ............................................. 75
ARTICLE 7 TRUSTEE
Section 7.01. Duties of Trustee ................................................. 75
Section 7.02. Rights of Trustee ................................................. 76
Section 7.03. Individual Rights of Trustee ...................................... 76
Section 7.04. Trustee's Disclaimer .............................................. 77
Section 7.05. Notice of Defaults ................................................ 77
Section 7.06. Reports by Trustee to Holders of the Notes ........................ 77
Section 7.07. Compensation and Indemnity ........................................ 77
Section 7.08. Replacement of Trustee ............................................ 78
Section 7.09. Successor Trustee by Merger, etc .................................. 79
Section 7.10. Eligibility; Disqualification ..................................... 79
Section 7.11. Preferential Collection of Claims Against Company ................. 80
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ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance ......... 80
Section 8.02. Legal Defeasance and Discharge ................................... 80
Section 8.03. Covenant Defeasance .............................................. 81
Section 8.04. Conditions to Legal or Covenant Defeasance ....................... 81
Section 8.05. Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions ................................. 82
Section 8.06. Repayment to Company ............................................. 83
Section 8.07. Reinstatement .................................................... 83
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes .............................. 84
Section 9.02. With Consent of Holders of Notes ................................. 84
Section 9.03. Compliance with Trust Indenture Act .............................. 86
Section 9.04. Revocation and Effect of Consents ................................ 86
Section 9.05. Notation on or Exchange of Notes ................................. 86
Section 9.06. Trustee to Sign Amendments, etc .................................. 87
ARTICLE 10 MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls ..................................... 87
Section 10.02. Notices .......................................................... 87
Section 10.03. Communication by Holders of Notes with Other Holders of Notes .... 88
Section 10.04. Certificate and Opinion as to Conditions Precedent ............... 88
Section 10.05. Statements Required in Certificate or Opinion .................... 89
Section 10.06. Rules by Trustee and Agents ...................................... 89
Section 10.07. No Personal Liability of Directors, Officers, Employees and
Stockholders ................................................... 89
Section 10.08. Governing Law .................................................... 89
Section 10.09. No Adverse Interpretation of Other Agreements .................... 90
Section 10.10. Successors ....................................................... 90
Section 10.11. Severability ..................................................... 90
Section 10.12. Counterpart Originals ............................................ 90
Section 10.13. Table of Contents, Headings, etc ................................. 90
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EXHIBITS
Exhibit A1 FORM OF NOTE
Exhibit A2 FORM OF REGULATION S TEMPORARY GLOBAL NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Exhibit E ADDITIONAL PROVISIONS RELATING TO SECTION 3(C)(7)
UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED
Exhibit E1 FORM OF DTC NOTICE TO INVESTORS
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INDENTURE dated as of March 27, 2001 between Emmis Escrow
Corporation, an Indiana corporation (the "Company"), and The Bank of Nova Scotia
Trust Company of New York, a New York trust company, as trustee (the "Trustee").
The Company and the Trustee agree as follows for the benefit
of each other and for the equal and ratable benefit of the Holders of the 12-1/2
% Senior Discount Notes due 2011 (the "Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions.
"144A Global Note" means a global note substantially in the
form of Exhibit A1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name
of, the Depositary or its nominee that will be issued in a denomination equal to
the outstanding principal amount at maturity of the Notes sold in reliance on
Rule 144A.
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness or Disqualified Stock of any other Person
existing at the time such other Person is merged with or into or became a
Subsidiary of such specified Person, including, without limitation, Indebtedness
incurred in connection with, or in contemplation of, such other Person merging
with or into or becoming a Subsidiary of such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset
acquired by such specified Person.
"Accreted Value" means, as of any date of determination, prior
to March 15, 2006 with respect to any Note, the sum of (a) the initial offering
price to investors of such Note and (b) the portion of the excess of the
principal amount of such Note over the initial offering price (which shall be
calculated by discounting the aggregate principal amount at maturity of such
Note at a rate of 12.5% per annum, compounded semi-annually on each March 15 and
September 15 from March 15, 2006 to the date of issuance) which shall have been
accreted thereon through such date, such amount to be so accreted on a daily
basis at a rate of 12.5% per annum of the initial offering price of such Note,
compounded semi-annually each March 15 and September 15 from the date of
issuance of the Notes through the date of determination, computed on the basis
of a 360-day year of twelve 30-day months.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with"), as used with respect to any
Person, shall mean the possession, directly or indirectly, of the power to
direct or cause the
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direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise provided that
beneficial ownership of 10% or more of the Voting Stock of a Person shall be
deemed to be control. For purposes of this definition, the terms "controlling,"
"controlled by" and "under common control with" shall have correlative meanings.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Annex to Articles" the annex to Emmis' Articles of
Incorporation governing the Exchangeable Preferred Stock to be filed with the
Secretary of State of Indiana.
"Applicable Premium" means, with respect to Note on any
Redemption Date (as defined in Section 3.07 herein), the greater of:
(1) 1.0% of the Accreted Value of the Note; or
(2) the excess of:
(a) the present value at such Redemption Date of the
redemption price of the Note at March 15, 2006 (such
redemption price being set forth in the table in Section 3.07
herein), computed using a discount rate equal to the Treasury
Rate as of such Redemption Date plus 50 basis points; over
(b) the Accreted Value of the Note.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Clearstream that apply to such
transfer or exchange.
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of any
assets or rights, other than sales of inventory in the ordinary course of
business; provided that the sale, conveyance or other disposition of all or
substantially all of the assets of the Company and its Restricted Subsidiaries
taken as a whole shall be governed by the provisions of Sections 4.14 and 5.01
of this Indenture and not by the provisions of Section 4.10 of this Indenture;
and
(2) the issuance of Equity Interests by any of the Company's
Restricted Subsidiaries or the sale of Equity Interests in any, of its
Subsidiaries.
Notwithstanding the preceding, the following items shall not
be deemed to be Asset Sales:
(1) any single transaction or series of related transactions
that: (a) involves assets having a fair market value of less than $1.0
million; or (b) results in net proceeds to the Company and its Restricted
Subsidiaries of less than $1.0 million;
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(2) a transfer of assets between or among the Company and any
of its Restricted Subsidiaries;
(3) an issuance of Equity Interests by a Restricted Subsidiary
to the Company or to another Restricted Subsidiary;
(4) a transfer by the Company of assets in a transaction that
qualifies as a charitable contribution or donation and which does not exceed
$2.0 million in the aggregate; and
(5) a Restricted Payment or Permitted Investment that is
permitted by Section 4.07 of this Indenture.
"Attributable Debt" in respect of a sale and leaseback
transaction means, at the time of determination, the present value of the
obligation of the lessee for net rental payments during the remaining term of
the lease included in such sale and leaseback transaction including any period
for which such lease has been extended or may, at the option of the lessor, be
extended. Such present value shall be calculated using a discount rate equal to
the rate of interest implicit in such transaction, determined in accordance with
GAAP.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
federal or state law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in
Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person" (as that term is used in Section
13(d)(3) of the Exchange Act), such "person" shall be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire by
conversion or exercise of other securities, whether such right is currently
exercisable or is exercisable only upon the occurrence of a subsequent
condition. The terms "Beneficially Owns" and "Beneficially Owned" shall have a
corresponding meaning.
"Board of Directors" means the Board of Directors of the
Company, or any authorized committee of the Board of Directors.
"Broker-Dealer" means any broker or dealer registered under
the Exchange Act.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at such time be required to be capitalized on a balance
sheet in accordance with GAAP.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
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(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and
(4) any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"Cash Equivalents" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or instrumentality thereof
(provided that the full faith and credit of the United States is pledged in
support thereof) having maturities of not more than six months from the date of
acquisition;
(3) certificates of deposit and eurodollar time deposits with
maturities of six months or less from the date of acquisition, bankers'
acceptances with maturities not exceeding six months and overnight bank
deposits, in each case with any lender party to the Credit Agreement or with any
domestic commercial bank having capital and surplus in excess of $500.0 million
and a Thompson Bank Watch Rating of "B" or better;
(4) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (2) and (3)
above entered into with any financial institution meeting the qualifications
specified in clause (3) above;
(5) commercial paper or marketable direct obligations issued
by any state of the United States of America or any political subdivision of any
such state or any public instrumentality thereof, in each case, having one the
two highest ratings obtainable from Moody's Investors Service, Inc. or Standard
& Poor's Ratings Group and in each case maturing within one year after the date
of acquisition; and
(6) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (1) - (5) of this
definition.
"Change of Control" means the occurrence of any of the
following:
(1) the sale, lease, transfer, conveyance or other disposition
(other than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company and its
Restricted Subsidiaries, taken as a whole to any "person" (as such term is used
in Section 13(d)(3) of the Exchange Act) other than a Principal or a Related
Party of a Principal;
(2) the adoption of a plan relating to the liquidation or
dissolution of the Company;
(3) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as defined above), other than
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the Principals and their Related Parties and disregarding any holding company
whose principal asset is capital stock of the Company, becomes the Beneficial
Owner, directly or indirectly, of more than 50% of the Voting Stock of the
Company, measured by voting power rather than number of shares; or
(4) the first day on which a majority of the members of the
Board of Directors of the Company are not Continuing Directors.
"Clearstream" means Clearstream Banking, S.A.
"Company" means Emmis Escrow Corporation, a wholly-owned,
direct subsidiary of Escrow Holdings, and any and all successors thereto.
"Consolidated EBITDA" means, with respect to any Person for
any period, the Consolidated Net Income of such Person for such period plus:
(1) an amount equal to any extraordinary loss on an after tax
basis plus any loss realized in connection with an Asset Sale or any refinancing
of a Credit Facility on an after tax basis, to the extent such losses were
deducted in computing such Consolidated Net Income; plus
(2) provision for taxes based on income or profits of such
Person and its Restricted Subsidiaries for such period, to the extent that such
provision for taxes was deducted in computing such Consolidated Net Income; plus
(3) consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued and whether or
not capitalized (including, without limitation, amortization of debt issuance
costs and original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component of all
payments associated with Capital Lease Obligations, imputed interest with
respect to Attributable Debt, commissions, consent fees, premiums, prepayment
penalties, discounts and other fees and charges incurred in respect of letter of
credit or bankers' acceptance financings, and net payments, if any, pursuant to
Hedging Obligations), to the extent that any such expense was deducted in
computing such Consolidated Net Income; plus
(4) depreciation, amortization (including amortization of
goodwill and other intangibles but excluding amortization of prepaid cash
expenses that were paid in a prior period) and other non-cash expenses
(excluding any such non-cash expense to the extent that it represents an accrual
of or reserve for cash expenses in any future period or amortization of a
prepaid cash expense that was paid in a prior period) of such Person and its
Restricted Subsidiaries for such period to the extent that such depreciation,
amortization and other non-cash expenses were deducted in computing such
Consolidated Net Income; plus
(5) all one-time cash compensation payments in connection
with employment agreements (or replacement therefor) as in effect on the date of
this Indenture; minus
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(6) non-cash items increasing such Consolidated Net Income
for such period, other than items that were accrued in the ordinary course of
business, in each case, on a consolidated basis and determined in accordance
with GAAP.
Notwithstanding the preceding, the provision for taxes based
on the income or profits of, and the depreciation and amortization and other
non-cash charges of, a Restricted Subsidiary of the Company shall be added to
Consolidated Net Income to compute Consolidated EBITDA of the Company only to
the extent that a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Restricted Subsidiary
without prior approval (that has not been obtained), pursuant to the terms of
its charter and all judgments, decrees, orders, statutes, rules and governmental
regulations applicable to that Subsidiary or its stockholders.
"Consolidated Indebtedness" means, with respect to any Person
as of any date of determination, the sum, without duplication, of:
(1) the total amount of Indebtedness of such Person and its
Restricted Subsidiaries; plus
(2) the total amount of Indebtedness of any other Person, to
the extent that such Indebtedness has been Guaranteed by the referent Person or
one or more of its Restricted Subsidiaries; plus
(3) the aggregate liquidation value of all Disqualified
Stock of such Person and all preferred stock of Restricted Subsidiaries of such
Person, in each case, determined on a consolidated basis in accordance with
GAAP.
"Consolidated Net Income" means, with respect to any Person
for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that:
(1) the Net Income or loss of any Person other than the
Company that is not a Restricted Subsidiary or that is accounted for by the
equity method of accounting shall be included only to the extent of the amount
of dividends or distributions paid in cash to the referent Person or a
Restricted Subsidiary thereof;
(2) the Net Income of any Restricted Subsidiary shall be
excluded to the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that Net Income is not at the
date of determination permitted without any prior governmental approval (that
has not been obtained) or, directly or indirectly, by operation of the terms of
its charter or any judgment, decree, order, statute, rule or governmental
regulation applicable to that Restricted Subsidiary or its stockholders;
(3) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition shall
be excluded;
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(4) the cumulative effect of a change in accounting principles
shall be excluded; and
(5) the Net Income or loss of any Unrestricted Subsidiary
shall be excluded whether or not distributed to the specified Person or one of
its Subsidiaries.
"Consolidated Net Worth" means, with respect to any Person
as of any date, the sum of:
(1) the consolidated equity of the common stockholders of such
Person and its consolidated Subsidiaries as of such date; plus
(2) the respective amounts reported on such Person's balance
sheet as of such date with respect to any series of preferred stock (other than
Disqualified Stock) that by its terms is not entitled to the payment of
dividends unless such dividends may be declared and paid only out of net
earnings in respect of the year of such declaration and payment, but only to the
extent of any cash received by such Person upon issuance of such preferred
stock.
"Continuing Directors" means, as of any date of determination,
any member of the Board of Directors of the Company who:
(1) was a member of such Board of Directors on the date of
this Indenture;
(2) was nominated for election or elected to such Board of
Directors with the approval of a majority of the Continuing Directors who were
members of such Board at the time of such nomination or election; or
(3) is a designee of a Principal or was nominated by a
Principal.
"Credit Agreement" means the Fourth Amended and Restated
Revolving Credit and Term Loan Agreement, dated as of December 29, 2000, as
amended, among Emmis Communications Corporation, the lenders named therein,
Toronto Dominion (Texas), Inc., as Administrative Agent, Fleet National Bank, as
Documentation Agent, First Union National Bank, as Syndication Agent, and Credit
Suisse First Boston Corporation, as co-document agent, as amended, restated,
modified, renewed, refunded, replaced or refinanced in whole or in part from
time to time.
"Credit Facilities" means one or more debt facilities
(including, without limitation, the Credit Agreement) or commercial paper
facilities with banks or other institutional lenders providing for revolving
credit loans, term loans, receivables financing (including through the sale of
receivables to such lenders or to special purpose entities formed to borrow from
such lenders against such receivables) or letters of credit, in each case, as
amended, restated, modified, renewed, refunded, replaced or refinanced in whole
or in part from time to time.
"Custodian" means the Trustee, as custodian with respect to
the Notes in global form, or any successor entity thereto.
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"Debenture Exchange Date" means the date on which Emmis (or
Emmis Holdings) exchanges all but not less than all of the Exchangeable
Preferred Stock for exchange debentures.
"Default" means any event that is, or with the passage of time
or the giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the
name of the Holder thereof and issued in accordance with Section 2.06 hereof,
substantially in the form of Exhibit A1 hereto except that such Note shall not
bear the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as the Depositary with respect to the Notes, and any and all successors
thereto appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Disqualified Stock" means any Capital Stock that, by its
terms (or by the terms of any security into which it is convertible, or for
which it is exchangeable, in each case at the option of the holder thereof), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
holder thereof, in whole or in part, on or prior to the date that is 91 days
after the date on which the Notes mature. Notwithstanding the preceding
sentence, any Capital Stock that would constitute Disqualified Stock solely
because the holders thereof have the right to require the Company to repurchase
such Capital Stock upon the occurrence of a change of control or an asset sale
shall not constitute Disqualified Stock if the terms of such Capital Stock
provide that the Company may not repurchase or redeem any such Capital Stock
pursuant to such provisions unless such repurchase or redemption complies with
Section 4.07 of this Indenture.
"Dividend Payment Date" means each of March 15 and September
15 of each year on which dates the dividends on the Exchangeable Preferred Stock
will be payable semi-annually in arrears, commencing on September 15, 2006.
"Domestic Restricted Subsidiary" means any Restricted
Subsidiary organized under or incorporated in any State of the United States or
the District of Columbia and has its principal place of business in the United
States.
"Emmis" means Emmis Communications Corporation, an Indiana
corporation.
"Emmis Holdings" means Emmis Holdings Corp., an Indiana
corporation that will acquire all of the capital stock of Emmis in connection
with the Holding Company Merger.
"Equity Interests" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).
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"Equity Offering" means any sale of Equity Interests of the
Company (excluding sales made to any Restricted Subsidiary and excluding sales
of Disqualified Stock) (a) to the public pursuant to an effective registration
statement under the Securities Act or (b) in a private placement of Equity
Interests of the Company pursuant to an exemption from the registration
requirements of the Securities Act.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and the regulations promulgated thereunder.
"Escrow Account" means the Escrow Account for the deposit of a
portion of the net proceeds from the sale of the Notes under the Escrow
Agreement.
"Escrow Agreement" means the Escrow and Disbursement
Agreement, dated as of the date of this Indenture, by and between the Company
and State Street Bank and Trust Company, a Massachusetts trust company, as
escrow agent.
"Escrow Corp. Merger" means the merger transaction involving
the Company, Escrow Holdings and Emmis (or Emmis Holdings) pursuant to the
Escrow Corp. Merger Agreement.
"Escrow Corp. Merger Agreement" means an Agreement and Plan of
Merger with respect to the Escrow Corp. Merger, dated as of the Closing Date.
"Escrow Holdings" means Emmis Escrow Holding Corporation, an
Indiana corporation and a wholly-owned, direct subsidiary of Emmis.
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Indenture" means an indenture under which Emmis (or
Emmis Holdings) will issue the exchange debentures.
"Exchangeable Preferred Stock" means (i) the 13-1/4% Senior
Exchangeable Preferred Stock due 2011 of Emmis (or Emmis Holdings) issued on the
Stock Issue Date, (ii) any and all additional fully-paid and non-assessable
shares of 13-1/4% Senior Exchangeable Preferred Stock due 2011 of Emmis (or
Emmis Holdings) issued after the Stock Issue Date as payment of dividends and
(iii) any and all shares of New Preferred Stock.
"Exchange Offer" means the exchange and issuance by Escrow
Corp. of New Notes, which shall be registered pursuant to a Registration
Statement, in an amount equal to the aggregate principal amount at maturity of
all Notes that are tendered by the holders thereof.
"Exchange Offer Registration Statement" means the Registration
Statement relating to the Exchange Offer, including the related Prospectus.
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"Existing Indebtedness" means Indebtedness of the Company and
its Subsidiaries (other than Indebtedness under the Credit Agreement) in
existence on the date of this Indenture, until such amounts are repaid.
"Fixed Charges" means, with respect to any Person for any
period, the sum, without duplication, of:
(1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued, including,
without limitation, amortization of debt issuance costs and original issue
discount, non-cash interest payments, the interest component of any deferred
payment obligations, the interest component of all payments associated with
Capital Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net payments, if any, pursuant
to Hedging Obligations; plus
(2) the consolidated interest of such Person and its
Restricted Subsidiaries that was capitalized during such period; plus
(3) any interest expense on Indebtedness of another Person
that is Guaranteed by such Person or one of its Restricted Subsidiaries or
secured by a Lien on assets, of such Person or one of its Restricted
Subsidiaries, whether or not such Guarantee or Lien is called upon and limited
to the amount of such Guarantee or the fair market value of such property
secured by such Lien, as the case may be.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect on the date hereof.
"Global Notes" means, individually and collectively, each of
the Restricted Global Notes and the Unrestricted Global Notes, substantially in
the form of Exhibit A hereto issued in accordance with Section 2.01,
2.06(b)(iv), 2.06(d)(ii) or 2.06(f) hereof.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"Government Securities" means direct obligations of, or
obligations guaranteed by, the United States of America, and the payment for
which the United States pledges its full faith and credit.
"Guarantee" means a guarantee other than by endorsement of
negotiable instruments for collection in the ordinary course of business, direct
or indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.
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"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under: (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements; and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates or currency exchange rates.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means the global Note substantially in the
form of Exhibit A1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee that will be issued in a denomination equal to
the outstanding principal amount at maturity of the Notes sold to Institutional
Accredited Investors.
"Indebtedness" means, without duplication, with respect to any
specified Person, any indebtedness of such Person, whether or not contingent, in
respect of:
(1) borrowed money;
(2) evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement
agreements in respect thereof);
(3) banker's acceptances;
(4) representing Capital Lease Obligations;
(5) the balance deferred and unpaid of the purchase price
of any property; or
(6) representing any Hedging Obligations,
except any such balance that constitutes an accrued expense or trade payable, if
and to the extent any of the foregoing indebtedness (other than letters of
credit and Hedging Obligations) would appear as a liability upon a balance sheet
of such Person prepared in accordance with GAAP, as well as all Indebtedness of
others secured by a Lien on any asset of such Person whether or not such
Indebtedness is assumed by such Person (the amount of such Indebtedness as of
any date being deemed to be the lesser of the value of such property or assets
as of such date or the principal amount of such Indebtedness of such other
Person so secured) and, to the extent not otherwise included, the Guarantee by
such Person of any Indebtedness of any other Person. The amount of any
Indebtedness outstanding as of any date shall be (i) the accreted value thereof,
in the case of any Indebtedness issued with original issue discount, and (ii)
the principal amount thereof, together with any interest thereon that is more
than 30 days past due, in the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented
from time to time.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
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"Institutional Accredited Investor" means an institution that
is an "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under
the Securities Act, who are not also QIBs.
"Investments" means, with respect to any Person, all
investments by such Person in other Persons (including Affiliates) in the forms
of direct or indirect loans (including guarantees of Indebtedness or other
obligations), advances or capital contributions (excluding commission, travel
and similar advances to officers and employees made in the ordinary course of
business), purchases or other acquisitions for consideration of Indebtedness,
Equity Interests or other securities, together with all items that are or would
be classified as investments on a balance sheet prepared in accordance with
GAAP. If the Company or any Restricted Subsidiary of the Company sells or
otherwise disposes of any Equity Interests of any direct or indirect Restricted
Subsidiary of the Company such that, after giving effect to any such sale or
disposition, such Person is no longer a Restricted Subsidiary of the Company,
the Company shall be deemed to have made an Investment on the date of any such
sale or disposition equal to the fair market value of the Equity Interests of
such Restricted Subsidiary not sold or disposed of in an amount determined as
provided in the final paragraph of Section 4.07 of this Indenture.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the City of New York or at a place of payment are
authorized by law, regulation or executive order to remain closed. If a payment
date is a Legal Holiday at a place of payment, payment may be made at that place
on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue on such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Notes for use by such
Holders in connection with the Exchange Offer.
"Leverage Ratio" means, with respect to any specified Person
on any date of determination (the "Calculation Date"), the ratio, on a pro forma
basis, of (1) the sum of the aggregate outstanding amount of Indebtedness and
Disqualified Stock of such Person and its Restricted Subsidiaries as of the
Calculation Date determined on a consolidated basis in accordance with GAAP to
(2) the Consolidated EBITDA of such Person and its Restricted Subsidiaries
attributable to continuing operations and businesses (exclusive of amounts
attributable to operations and businesses permanently discontinued or disposed
of) for the Reference Period. For purposes of calculating the Leverage Ratio:
(1) acquisitions that have been made by the specified Person
or any of its Restricted Subsidiaries, including through mergers or
consolidations and including any related financing transactions, during the
Reference Period or subsequent to such Reference Period and on or prior to the
Calculation Date shall be deemed to have occurred on the first day of such
Reference Period and Consolidated EBITDA for such Reference Period shall be
calculated without giving effect to clause (3) of the proviso set forth in the
definition of Consolidated Net Income; and
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(2) transactions giving rise to the need to calculate the
Leverage Ratio shall be assumed to have occurred on the first day of the
four-quarter reference period.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law, including any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to sell or give a
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction.
"Liquidated Damages" means all liquidated damages then owing
pursuant to Section 5 of the Registration Rights Agreement.
"Marketable Securities" means publicly traded debt or equity
securities that are listed for trading on a national securities exchange and
that were issued by a corporation with debt securities are rated at least "AAA-"
from S&P or "Aaa3" from Moody's.
"Moody's" means Moody's Investors Service, Inc.
"Net Income" means, with respect to any Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however:
(1) any gain or loss, together with any related provision
for taxes on such gain or loss, realized in connection with (a) any Asset Sale
(including, without limitation, dispositions pursuant to sale and leaseback
transactions) or (b) the disposition of any securities by such Person or any of
its Restricted Subsidiaries or the extinguishment of any Indebtedness of such
Person or any of its Restricted Subsidiaries; and
(2) any extraordinary gain or loss, together with any related
provision for taxes on such extraordinary gain or loss.
"Net Proceeds" means the aggregate cash proceeds received by
the Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of:
(1) the direct costs relating to such Asset Sale (including,
without limitation, legal, accounting and investment banking fees, and sales
commissions) and any relocation expenses incurred as a result thereof;
(2) taxes paid or payable as a result thereof (after taking
into account any available tax credits or deductions and any tax sharing
arrangements);
(3) amounts required to be applied to the repayment of
Indebtedness (other than Indebtedness under a Credit Facility) secured by a Lien
on the asset or assets that were the subject of such Asset Sale;
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(4) all distributions and other payments required to be made
to minority interest holders in Restricted Subsidiaries as a result of such
Asset Sale;
(5) the deduction of appropriate amounts provided by the
seller as a reserve in accordance with GAAP against any liabilities associated
with the assets disposed of in such Asset Sale and retained by the Company or
any Restricted Subsidiary after such Asset Sale; and
(6) without duplication, any reserves that the Company's
Board of Directors determines in good faith should be made in respect of the
sale price of such asset or assets for post closing adjustments; provided that
in the case of any reversal of any reserve referred to in clause (5) or (6)
above, the amount so reserved shall be deemed to be Net Proceeds from an Asset
Sale as of the date of such reversal.
"New Exchange Debentures" means the Company's subordinated
exchange debentures due 2011 issued pursuant to the Exchange Indenture (i) in
the Exchange Offer or (ii) in connection with a resale of exchange debentures in
reliance on a Shelf Registration Statement.
"New Notes" means the Company's Senior Discount Notes due 2011
issued pursuant to this Indenture (i) in the Exchange Offer or (ii) in
connection with a resale of Notes in reliance on a Shelf Registration Statement.
"New Preferred Stock" means the Company's Exchangeable
Preferred Stock due 2011 issued pursuant to the Annex to Articles (i) in an
exchange offer or (ii) in connection with a resale of Exchangeable Preferred
Stock in reliance on a Shelf Registration Statement.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company nor any of its
Restricted Subsidiaries (a) provides credit support of any kind (including any
undertaking, agreement or instrument that would constitute Indebtedness), (b) is
directly or indirectly liable (as a guarantor or otherwise), or (c) constitutes
the lender;
(2) no default with respect to which (including any rights
that the holders thereof may have to take enforcement action against an
Unrestricted Subsidiary) would permit (upon notice, lapse of time or both) any
holder of any other Indebtedness of the Company or any of its Restricted
Subsidiaries to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its stated maturity; and
(3) as to which the lenders have been notified in writing
that they will not have any recourse to the assets of the Company or the stock
or assets of any of its Restricted Subsidiaries (except that this clause (3)
will not apply to any Indebtedness incurred by the Company and its Subsidiaries
prior to the date of this Indenture).
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Notes" has the meaning assigned to it in the preamble to this
Indenture.
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"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering" means the offering of $370.0 million in aggregate
principal amount at maturity of the Notes pursuant to the Company's Offering
Circular, dated March 21, 2001.
"Officer" means, with respect to any Person, the Chairman of
the Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer,
the Controller, the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf
of the Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Company, that meets the requirements of
Section 10.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
10.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Participant" means, with respect to the Depositary, Euroclear
or Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Permitted Business" means any business conducted by the
Company, its Restricted Subsidiaries on the date of this Indenture and any other
business related, ancillary or complementary to any such business.
"Permitted Investments" means:
(1) any Investment in the Company or in a Restricted
Subsidiary of the Company;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Restricted Subsidiary
of the Company in a Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary of the
Company; or
(b) such Person is merged, consolidated or amalgamated
with or into, or transfers or conveys substantially
all of its assets to, or is liquidated into, the
Company or a Restricted Subsidiary of the Company;
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(4) any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.10 of this Indenture;
(5) any acquisition of assets solely in exchange for the
issuance of Equity Interests (other than Disqualified Stock) of the Company;
(6) other Investments in any Person having an aggregate fair
market value (measured on the date each such Investment was made and without
giving effect to subsequent changes in value), when taken together with all
other Investments made pursuant to this clause (6) since the date of this
Indenture, not to exceed $15 million in the aggregate;
(7) Investments in Permitted Joint Ventures, provided that,
at the time of and immediately after giving pro forma effect to such Investment
(and any related transaction or series of transactions), the Leverage Ratio
under clause (C) of the first paragraph of Section 4.09 would be less than or
equal to such Leverage Ratio immediately prior to such Investment;
(8) any purchase, redemption, defeasance or other acquisition
of Indebtedness of the Company or any Restricted Subsidiary using the proceeds
of Permitted Refinancing Indebtedness incurred under paragraph (5) of the
definition of Permitted Debt;
(9) agreements relating to the Indebtedness incurred under
paragraph (7) of the definition of Permitted Debt;
(10) Investments in securities of trade creditors or customers
received pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such trade creditors or customers in good faith
settlement of delinquent obligations of such trade creditors or customers;
(11) guarantees of Indebtedness otherwise permitted to be
incurred by this Indenture, Annex to Articles or the Exchange Indenture, as the
case may be;
(12) Investments in the form of Productive Assets received in
connection with an Asset Sale;
(13) commission, travel, payroll, entertainment, relocation
and similar advances made to officers and employees of the Company or any
Restricted Subsidiary made in the ordinary course of business; and
(14) any Investment in the form of loans or advances to
employees of the Company not to exceed $3.0 million in aggregate principal
amount at any one time outstanding.
"Permitted Joint Ventures" means a corporation, partnership or
other entity (other than a Subsidiary) engaged in one or more Permitted
Businesses in respect of which the Company or a Restricted Subsidiary (a)
beneficially owns at least 20% of the Equity Interests of such entity and (b)
either is a party to an agreement empowering one or more parties to such
agreement (which may or may not be the Company or a Subsidiary), or is a member
of a group
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that, pursuant to the constituent documents of the applicable corporation,
partnership or other entity, has the power, to direct the policies, management
and affairs of such entity.
"Permitted Liens" means:
(1) Liens securing Indebtedness of the Company under one or
more Credit Facilities that was permitted by the terms of this Indenture, as
appropriate, to be incurred;
(2) Liens securing any Indebtedness of any of the Company's
Restricted Subsidiaries that was permitted by the terms of this Indenture, as
appropriate, to be incurred;
(3) Liens in favor of the Company;
(4) Liens existing on the date of this Indenture;
(5) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded, provided
that any reserve or other appropriate provision as shall be required in
conformity with GAAP shall have been made therefor;
(6) Liens securing Indebtedness of the type permitted to be
incurred under clause (4) of Section 4.09 of this Indenture;
(7) Liens incurred in the ordinary course of business of the
Company or any Restricted Subsidiary of the Company with respect to obligations
that do not exceed $5.0 million at any one time outstanding and that (a) are not
incurred in connection with the borrowing of money or the obtaining of advances
or credit (other than trade credit in the ordinary course of business) and (b)
do not in the aggregate materially detract from the value of the property or
materially impair the use thereof in the operation of business by the Company or
such Restricted Subsidiary;
(8) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen and other Liens
imposed by law incurred in the ordinary course of business in connection
therewith, or to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations (other than obligations for
the payment of borrowed money);
(9) Liens incurred or deposits made in the ordinary course
of business in connection with workers' compensation, unemployment insurance and
other types of social security, including any Liens securing letters of credit
issued in the ordinary course of business in connection therewith, or to secure
the performance of tenders, statutory obligations, surety and appeal bonds,
bids, leases, government contracts, performance and return-of-money bonds and
other similar obligations (exclusive of obligations for the payment of borrowed
money);
(10) judgment Liens not giving rise to an Event of Default;
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(11) easements, rights-of-way, zoning restrictions and other
similar charges or encumbrances in respect of real property not interfering in
any material respect with the ordinary conduct of the business of the Company or
any of its Restricted Subsidiaries;
(12) Liens upon specific items of inventory or other goods
and proceeds of any Person securing such Person's obligations in respect of
bankers' acceptances issued or created for the account of such Person to
facilitate the purchase, shipment or storage of such inventory or other goods;
(13) Liens securing reimbursement obligations with respect
to commercial letters of credit which encumber documents and other property
relating to such letters of credit and products and proceeds thereof;
(14) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual, or warranty requirements of the
Company or any of its Restricted Subsidiaries, including rights of offset and
set-off;
(15) any lease or sublease to a third party;
(16) Liens placed upon assets of a Restricted Subsidiary of
the Company not organized under the laws of the United States or any subdivision
thereof to service the Indebtedness of such Restricted Subsidiary that is
other-wise permitted under the Indenture;
(17) Liens on property existing at the time of acquisition
thereof by the Company or any Restricted Subsidiary of the Company, provided
that such Liens were not incurred in connection with, or in contemplation of,
such acquisition;
(18) Liens on materials, inventory or consumables and the
proceeds therefrom securing trade payables relating to such materials, inventory
or consumables;
(19) Liens in favor of customs and revenues authorities
arising as a matter of law to secure payment of customs duties in connection
with the importation of goods;
(20) Liens created under the Escrow Agreement; and
(21) any extension, renewal or replacement, in whole or in
part, of any Lien described in the foregoing clauses (1) through (20) provided
that the Lien so extended, renewed or replaced does not extend to any additional
property or assets.
"Permitted Refinancing Indebtedness" means any Indebtedness of
the Company or any of its Restricted Subsidiaries or Disqualified Stock of the
Company issued in exchange for, or the net proceeds of which are used to extend,
refinance, renew, replace, defease or refund other Indebtedness or Disqualified
Stock of the Company or any of its Restricted Subsidiaries (other than
intercompany Indebtedness); provided that:
(1) the principal amount, initial accreted value or
liquidation preference, if applicable, of such Permitted Refinancing
Indebtedness does not exceed the principal amount of
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(or accreted value, if applicable), plus accrued interest on, the Indebtedness
(or the liquidation preference of the Disqualified Stock) so extended,
refinanced, renewed, replaced, defeased or refunded (plus the amount of
expenses, consent fees and prepayment premiums incurred in connection
therewith);
(2) such Permitted Refinancing Indebtedness has a final
maturity date later than the final maturity date of, and has a Weighted Average
Life to Maturity equal to or greater than the Weighted Average Life to Maturity
of, the Indebtedness or Disqualified Stock being extended, refinanced, renewed,
replaced, defeased or refunded;
(3) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the Notes,
such Permitted Refinancing Indebtedness is subordinated in right of payment to,
the Notes on terms at least as favorable to the Holders as those contained in
the documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by the Company or by
the Restricted Subsidiary who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization or government or agency or political
subdivision thereof (including any subdivision or ongoing business of any such
entity or substantially all of the assets of any such entity, subdivision or
business).
"Principals" means Jeffrey H. Smulyan.
"Private Placement Legend" means the legend set forth in
Section 2.06(g)(i) to be placed on all Notes issued under this Indenture except
where otherwise permitted by the provisions of this Indenture.
"Productive Assets" means assets (including Equity Interests)
that are used or usable by the Company and/or a Restricted Subsidiary in
Permitted Businesses; provided that for any Equity Interests to qualify as
Productive Assets, they must, after giving pro forma effect to the transaction
in which they were acquired, be Equity Interests of a Restricted Subsidiary.
"Prospectus" means the prospectus included in a Registration
Statement at the time such Registration Statement is declared effective, as
amended or supplemented by any prospectus supplement and by all other amendments
thereto, including post-effective amendments, and all material incorporated by
reference into such Prospectus.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Reference Period" means, with regard to any Person, the four
full fiscal quarters (or such lesser period during which such Person has been in
existence) ended immediately
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preceding any date upon which any determination or calculation is to be made
pursuant to the terms of this Indenture.
"Registration Rights Agreement" means the registration rights
agreement to be entered into by the Company on or before the date of this
Indenture relating to the registration of the issuance and sale to the public of
the Notes or the New Notes with the Commission.
"Registration Statement" means any registration statement of
the Company relating to an offering of New Notes that is filed pursuant to the
provisions of the Registration Rights Agreement, and includes the Prospectus
included therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and material incorporated by
reference therein.
"Related Party" with respect to any Principal means:
(1) any controlling stockholder, 80% (or more) owned
Subsidiary of such Principal;
(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, members, partners, owners or Persons beneficially
holding an 80% or more controlling interest of which consist of such Principal
and/or such other Persons referred to in the immediately preceding clause (1);
or
(3) a spouse, lineal descendants and ascendants, heirs,
executors or other legal representatives and any trusts or other entities
established by or for the benefit of any of the foregoing or established by any
of the foregoing for charitable purposes, or any other person or entity in which
the foregoing persons or entities exercise control.
"Regulation S" means Regulation S promulgated under the
Securities Act.
"Regulation S Global Note" means a Regulation S Temporary
Global Note or Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent Global
Note in the form of Exhibit A1 hereto bearing the Global Note Legend and the
Private Placement Legend and deposited with or on behalf of and registered in
the name of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary Global
Note in the form of Exhibit A2 hereto bearing the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee, issued in a denomination equal to the outstanding principal amount
at maturity of the Notes initially sold in reliance on Rule 903 of Regulation S.
"Reorganization" means either (i) the transfer of all of
Emmis' assets and liabilities (including indebtedness under its credit facility
and outstanding senior subordinated
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notes) to a newly-formed subsidiary (the "Asset Drop-Down") or (ii) a merger
whereby a new holding company, Emmis Holdings, will acquire all of the capital
stock of Emmis, and the stockholders of Emmis will become stockholders of Emmis
Holdings (the "Holding Company Merger").
"Responsible Officer," when used with respect to the Trustee,
means any officer within the Corporate Trust Administration of the Trustee (or
any successor group of the Trustee) or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing
the Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the
Private Placement Legend.
"Restricted Investment" means any Investment other than a
Permitted Investment.
"Restricted Period" means the 40-day restricted period as
defined in Regulation S.
"Restricted Subsidiary" of a Person means any Subsidiary of
the referent Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities
Act.
"Rule 144A" means Rule 144A promulgated under the Securities
Act.
"Rule 903" means Rule 903 promulgated under the Securities
Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
"S&P" means Standard & Poor's Corporation.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Subordinated Notes Indenture" means that certain
Indenture, dated as of February 12, 1999, governing the Emmis' 8% Senior
Subordinated Notes due 2009.
"Shelf Registration Statement" means the Shelf Registration
Statement as defined in the Registration Rights Agreement.
"Significant Subsidiary" means, with respect to any Person,
any Restricted Subsidiary of such Person that would be a "significant
subsidiary" of such Person as defined in
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Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Act, as such
Regulation is in effect on the date hereof.
"Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which such
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.
"Stock Issue Date" means the date on which Emmis (or Emmis
Holdings) issues the Exchangeable Preferred Stock in exchange for all of the
then outstanding Notes issued by Emmis Escrow Corporation.
"Subsidiary" means, with respect to any Person:
(1) any corporation, association or other business entity of
which more than 50% of the total voting power of shares of Capital Stock
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by such Person or one or more of the other
Subsidiaries of that Person (or a combination thereof); and
(2) any partnership (a) the sole general partner or the
managing general partner of which is such Person or a Subsidiary of such Person
or (b) the only general partners of which are such Person or one or more
Subsidiaries of such Person (or any combination thereof).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date on which this Indenture is
qualified under the TIA.
"Treasury Rate" means, as of any Redemption Date, the yield to
maturity as of such Redemption Date of United States Treasury Securities with a
constant maturity (as compiled and published in the most recent Federal Reserve
Statistical Release H.15 (519) that has become publicly available at lease two
Business Days prior to the Redemption Date (or, if such Statistical Release is
no longer published, any publicly available source of similar market data) most
nearly equal to the period from the Redemption Date to March 15, 2006; provided,
however, that if the period from the Redemption Date to March 15, 2006 is less
than one year, the weekly average yield on actually traded United States
Treasury securities adjusted to a constant maturity of one year shall be used.
"Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
"Unrestricted Definitive Note" means one or more Definitive
Notes that do not bear and are not required to bear the Private Placement
Legend.
"Unrestricted Global Note" means a permanent global Note
substantially in the form of Exhibit A1 attached hereto that bears the Global
Note Legend and that has the "Schedule
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of Exchanges of Interests in the Global Note" attached thereto, and that is
deposited with or on behalf of and registered in the name of the Depositary,
representing a series of Notes that do not bear the Private Placement Legend.
"Unrestricted Subsidiary" means (i) following the
Reorganization and the Escrow Corp. Merger, Game Warden Wildlife Journal
Magazine, LLC (an Indiana limited liability company), Country Sampler Stores,
LLC (an Illinois limited liability company), Radio Hungaria Co., Ltd. (a
Hungarian corporation) and (ii) any Subsidiary of the Company that is designated
by the Board of Directors as an Unrestricted Subsidiary pursuant to a Board
Resolution; but only to the extent that such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the Company
unless the terms of any such agreement, contract, arrangement or understanding
are no less favorable to the Company or such Restricted Subsidiary than those
that might be obtained at the time from Persons who are not Affiliates of the
Company;
(3) is a Person with respect to which neither the Company
nor any of its Restricted Subsidiaries has any direct or indirect obligation (x)
to subscribe for additional Equity Interests or (y) to maintain or preserve such
Person's financial condition or to cause such Person to achieve any specified
levels of operating results;
(4) has not guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Company or any of its
Restricted Subsidiaries; and
(5) has at least one director on its board of directors that
is not a director or executive officer of the Company or any of its Restricted
Subsidiaries and has at least one executive officer that is not a director or
executive officer of the Company or any of its Restricted Subsidiaries.
Any such designation by the Board of Directors shall be evidenced to the Trustee
by filing with the Trustee a certified copy of the Board Resolution giving
effect to such designation and an Officers' Certificate certifying that such
designation complied with the foregoing conditions and was permitted by Section
4.07 of this Indenture. If, at any time, any Unrestricted Subsidiary would fail
to meet the foregoing requirements as an Unrestricted Subsidiary, it shall
thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture
and any Indebtedness of such Subsidiary shall be deemed to be incurred by a
Restricted Subsidiary of the Company as of such date (and, if such Indebtedness
is not permitted to be incurred as of such date under Section 4.09 of this
Indenture, the Company shall be in default of such covenant). The Board of
Directors of the Company may at any time designate any Unrestricted Subsidiary
to be a Restricted Subsidiary; provided that such designation shall be deemed to
be an incurrence of Indebtedness by a Restricted Subsidiary of the Company of
any outstanding Indebtedness of such Unrestricted Subsidiary and such
designation shall only be permitted if (i) such Indebtedness is permitted under
Section 4.09 of this Indenture, calculated on a pro forma basis as if such
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designation had occurred at the beginning of the Reference Period, and (ii) no
Default would occur or be in existence following such designation.
"U.S. Person" means a U.S. person as defined in Rule 902(o)
under the Securities Act.
"Voting Stock" of any Person as of any date means the Capital
Stock of such Person that is at the time entitled to vote in the election of the
Board of Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness or series or class of preferred stock at any date, the number of
years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the
amount of each then remaining installment, sinking fund, serial maturity or
other required payments of principal or liquidation preference, including
payment at final maturity, in respect thereof, by (b) the number of years
(calculated to the nearest one-twelfth) that will elapse between such date and
the making of such payment; by
(2) the then outstanding principal amount or liquidation
preference of such Indebtedness or series or class of preferred stock.
"Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
shall at the time be owned by such Person and/or by one or more Wholly Owned
Restricted Subsidiaries of such Person.
Section 1.02. Other Definitions.
Defined in
Term Section
---- -------
"Affiliate Transaction".............................................. 4.11
"Asset Sale Offer"................................................... 3.09
"Authentication Order"............................................... 2.02
"Change of Control Offer"............................................ 4.14
"Change of Control Payment".......................................... 4.14
"Change of Control Payment Date"..................................... 4.14
"Covenant Defeasance"................................................ 8.03
"Event of Default"................................................... 6.01
"Excess Proceeds".................................................... 4.10
"incur".............................................................. 4.09
"Legal Defeasance"................................................... 8.02
"Offer Amount"....................................................... 3.09
"Offer Period"....................................................... 3.09
"Paying Agent"....................................................... 2.03
"Permitted Debt"..................................................... 4.09
"Purchase Date"...................................................... 3.09
"Registrar".......................................................... 2.03
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Defined in
Term Section
---- -------
"Restricted Payments"................................................ 4.07
Section 1.03. Incorporation by Reference of Trust Indenture
Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee; and
"obligor" on the Notes means the Company and any successor
obligor upon the Notes.
All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the
plural include the singular;
(e) provisions apply to successive events and transactions;
and
(f) references to sections of or rules under the Securities
Act shall be deemed to include substitute, replacement or successor sections or
rules adopted by the SEC from time to time.
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ARTICLE 2
THE NOTES
Section 2.01. Form and Dating.
(a) General. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto. The Notes
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Each Note shall be dated the date of its authentication. The Notes
shall be in denominations of $1,000 of principal amount at maturity and integral
multiples thereof.
The terms and provisions contained in the Notes shall
constitute, and are hereby expressly made, a part of this Indenture and the
Company and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions of
this Indenture, the provisions of this Indenture shall govern and be
controlling.
(b) Global Notes. Notes issued in global form shall be
substantially in the form of Exhibits A1 or A2 attached hereto (including the
Global Note Legend thereon and the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Notes issued in definitive form shall be
substantially in the form of Exhibit A1 attached hereto (but without the Global
Note Legend thereon and without the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Each Global Note shall represent such of the
outstanding Notes as shall be specified therein and each shall provide that it
shall represent the aggregate principal amount at maturity of outstanding Notes
from time to time endorsed thereon and that the aggregate principal amount at
maturity of outstanding Notes represented thereby may from time to time be
reduced or increased, as appropriate, to reflect exchanges and redemptions. Any
endorsement of a Global Note to reflect the amount of any increase or decrease
in the aggregate principal amount at maturity of outstanding Notes represented
thereby shall be made by the Trustee or the Custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder thereof as required
by Section 2.06 hereof.
(c) Temporary Global Notes. Notes offered and sold in reliance
on Regulation S shall be issued initially in the form of the Regulation S
Temporary Global Note, which shall be deposited on behalf of the purchasers of
the Notes represented thereby with the Trustee, at its New York office, as
custodian for the Depositary, and registered in the name of the Depositary or
the nominee of the Depositary for the accounts of designated agents holding on
behalf of Euroclear or Clearstream, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The Restricted Period
shall be terminated upon the receipt by the Trustee of (i) a written certificate
from the Depositary, together with copies of certificates from Euroclear and
Clearstream certifying that they have received certification of non-United
States beneficial ownership of 100% of the aggregate principal amount of the
Regulation S Temporary Global Note (except to the extent of any beneficial
owners thereof who acquired an interest therein during the Restricted Period
pursuant to another exemption from registration under the Securities Act and who
will take delivery of a beneficial ownership interest in a 144A Global Note or
an IAI Global Note bearing a Private Placement Legend, all as contemplated by
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Section 2.06(a)(ii) hereof), and (ii) an Officers' Certificate from the Company.
Following the termination of the Restricted Period, beneficial interests in the
Regulation S Temporary Global Note shall be exchanged for beneficial interests
in Regulation S Permanent Global Notes pursuant to the Applicable Procedures.
Simultaneously with the authentication of Regulation S Permanent Global Notes,
the Trustee shall cancel the Regulation S Temporary Global Note. The aggregate
principal amount of the Regulation S Temporary Global Note and the Regulation S
Permanent Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary or its
nominee, as the case may be, in connection with transfers of interest as
hereinafter provided.
(d) Euroclear and Clearstream Procedures Applicable. The
provisions of the "Operating Procedures of the Euroclear System" and "Terms and
Conditions Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream Banking" and "Customer Handbook" of Clearstream shall be applicable
to transfers of beneficial interests in the Regulation S Temporary Global Note
and the Regulation S Permanent Global Notes that are held by Participants
through Euroclear or Clearstream.
(e) Sections 2.01(c) and (d) shall not apply and Regulation S
Temporary Global Notes and Regulation S Permanent Global Notes shall not be
issued until no Person (a "3(c)(7) Issuer") claiming to be exempt from
registration as an "investment company" under Section 3(c)(7) of the Investment
Company Act of 1940 is an obligor under the Notes.
Section 2.02. Execution and Authentication.
An Officer shall sign the Notes for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid.
A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed
by an Officer (an "Authentication Order"), authenticate Notes for original issue
up to the aggregate principal amount at maturity stated in paragraph 4 of the
Notes. The aggregate principal amount at maturity of Notes outstanding at any
time may not exceed such amount except as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
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Section 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency where Notes may
be presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Custodian with respect to the Global
Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal, premium or Liquidated Damages, if any, or interest on the
Notes, and will notify the Trustee of any default by the Company in making any
such payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Paying Agent for the Notes.
Section 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA Section 312(a). If
the Trustee is not the Registrar, the Company shall furnish to the Trustee at
least seven Business Days before each interest payment date and at such other
times as the Trustee may request in writing, a list in such form and as of such
date as the Trustee may reasonably require of the names and addresses of the
Holders of Notes and the Company shall otherwise comply with TIA Section 312(a).
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Section 2.06. Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may
not be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. All Global Notes
will be exchanged by the Company for Definitive Notes if (i) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or
unable to continue to act as Depositary or that it is no longer a clearing
agency registered under the Exchange Act and, in either case, a successor
Depositary is not appointed by the Company within 120 days after the date of
such notice from the Depositary or (ii) the Company in its sole discretion
determines that the Global Notes (in whole but not in part) should be exchanged
for Definitive Notes and delivers a written notice to such effect to the
Trustee; provided that in no event shall the Regulation S Temporary Global Note
be exchanged by the Company for Definitive Notes prior to (x) the expiration of
the Restricted Period and (y) the receipt by the Registrar of any certificates
required pursuant to Rule 903(c)(3)(ii)(B) under the Securities Act. Upon the
occurrence of either of the preceding events in (i) or (ii) above, Definitive
Notes shall be issued in such names as the Depositary shall instruct the
Trustee. Global Notes also may be exchanged or replaced, in whole or in part, as
provided in Sections 2.07 and 2.10 hereof. Every Note authenticated and
delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be
authenticated and delivered in the form of, and shall be, a Global Note. A
Global Note may not be exchanged for another Note other than as provided in this
Section 2.06(a); however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the
Global Notes. The transfer and exchange of beneficial interests in the Global
Notes shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial interests
in the Restricted Global Notes shall be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act. Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global
Note. Beneficial interests in any Restricted Global Note may be
transferred to Persons who take delivery thereof in the form of a
beneficial interest in the same Restricted Global Note in accordance
with the transfer restrictions set forth in the Private Placement
Legend; provided, however, that prior to the expiration of the
Restricted Period, transfers of beneficial interests in the Temporary
Regulation S Global Note may not be made to a U.S. Person or for the
account or benefit of a U.S. Person other than an initial purchaser of
the Notes pursuant to the Purchase Agreement dated as of March 13, 2001
among the Company and the several initial purchasers named therein
(each, an "Initial Purchaser"). Beneficial interests in any
Unrestricted Global Note may be transferred to Persons who take
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note.
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No written orders or instructions shall be required to be delivered to
the Registrar to effect the transfers described in this Section
2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all transfers and
exchanges of beneficial interests that are not subject to Section
2.06(b)(i) above, the transferor of such beneficial interest must
deliver to the Registrar either (A) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
credit or cause to be credited a beneficial interest in another Global
Note in an amount equal to the beneficial interest to be transferred or
exchanged and (2) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant account to
be credited with such increase or (B) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
cause to be issued a Definitive Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions
given by the Depositary to the Registrar containing information
regarding the Person in whose name such Definitive Note shall be
registered to effect the transfer or exchange referred to in (1) above;
provided that in no event shall Definitive Notes be issued upon the
transfer or exchange of beneficial interests in the Regulation S
Temporary Global Note prior to (x) the expiration of the Restricted
Period and (y) the receipt by the Registrar of any certificates
required pursuant to Rule 903 under the Securities Act. Upon
consummation of an Exchange Offer by the Company in accordance with
Section 2.06(f) hereof, the requirements of this Section 2.06(b)(ii)
shall be deemed to have been satisfied upon receipt by the Registrar of
the instructions contained in the Letter of Transmittal delivered by
the Holder of such beneficial interests in the Restricted Global Notes.
Upon satisfaction of all of the requirements for transfer or exchange
of beneficial interests in Global Notes contained in this Indenture and
the Notes or otherwise applicable under the Securities Act, the Trustee
shall adjust the principal amount of the relevant Global Note(s)
pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another
Restricted Global Note. A beneficial interest in any Restricted Global
Note may be transferred to a Person who takes delivery thereof in the
form of a beneficial interest in another Restricted Global Note if the
transfer complies with the requirements of Section 2.06(b)(ii) above
and the Registrar receives the following:
(A) if the transferee will take delivery in the
form of a beneficial interest in the 144A Global Note, then
the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (1)
thereof;
(B) if the transferee will take delivery in the
form of a beneficial interest in the Regulation S Temporary
Global Note or Regulation S Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (2) thereof; and
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(C) if the transferee will take delivery in the
form of a beneficial interest in the IAI Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications and certificates and
Opinion of Counsel required by item (3) thereof, if
applicable.
(iv) Transfer and Exchange of Beneficial Interests in
a Restricted Global Note for Beneficial Interests in the Unrestricted
Global Note. A beneficial interest in any Restricted Global Note may be
exchanged by any holder thereof for a beneficial interest in an
Unrestricted Global Note or transferred to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note if the exchange or transfer complies with the requirements of
Section 2.06(b)(ii) above and:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the
Registration Rights Agreement and the holder of the beneficial
interest to be transferred, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution
of the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial
interest in a Restricted Global Note proposes to
exchange such beneficial interest for a beneficial
interest in an Unrestricted Global Note, a certificate
from such holder in the form of Exhibit C hereto,
including the certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial
interest in a Restricted Global Note proposes to
transfer such beneficial interest to a Person who shall
take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note, a certificate
from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer
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contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the
Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been
issued, the Company shall issue and, upon receipt of an Authentication
Order in accordance with Section 2.02 hereof, the Trustee shall
authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the aggregate principal amount of beneficial
interests transferred pursuant to subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for
Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes. If any holder of a beneficial interest in
a Restricted Global Note proposes to exchange such beneficial interest
for a Restricted Definitive Note or to transfer such beneficial
interest to a Person who takes delivery thereof in the form of a
Restricted Definitive Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the holder of such beneficial interest in
a Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate from
such holder in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A under the
Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (1)
thereof;
(C) if such beneficial interest is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities Act,
a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (2) thereof;
(D) if such beneficial interest is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144
under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (3)(a) thereof;
(E) if such beneficial interest is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of
the Securities Act other than those listed in subparagraphs
(B) through (D) above, a certificate to the effect set forth
in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable;
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(F) if such beneficial interest is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or
(G) if such beneficial interest is being
transferred pursuant to an effective registration statement
under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to Section
2.06(h) hereof, and the Company shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive
Note issued in exchange for a beneficial interest in a Restricted
Global Note pursuant to this Section 2.06(c) shall be registered in
such name or names and in such authorized denomination or denominations
as the holder of such beneficial interest shall instruct the Registrar
through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes
to the Persons in whose names such Notes are so registered. Any
Definitive Note issued in exchange for a beneficial interest in a
Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear
the Private Placement Legend and shall be subject to all restrictions
on transfer contained therein.
(ii) Beneficial Interests in Regulation S Temporary
Global Note to Definitive Notes. Notwithstanding Sections 2.06(c)(i)(A)
and (C) hereof, a beneficial interest in the Regulation S Temporary
Global Note may not be exchanged for a Definitive Note or transferred
to a Person who takes delivery thereof in the form of a Definitive Note
prior to (x) the expiration of the Restricted Period and (y) the
receipt by the Registrar of any certificates required pursuant to Rule
903(c)(3)(ii)(B) under the Securities Act, except in the case of a
transfer pursuant to an exemption from the registration requirements of
the Securities Act other than Rule 903 or Rule 904.
(iii) Beneficial Interests in Restricted Global Notes
to Unrestricted Definitive Notes. A holder of a beneficial interest in
a Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the
Registration Rights Agreement and the holder of such
beneficial interest, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution
of the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement;
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(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial
interest in a Restricted Global Note proposes to
exchange such beneficial interest for a Definitive Note
that does not bear the Private Placement Legend, a
certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(b)
thereof; or
(2) if the holder of such beneficial
interest in a Restricted Global Note proposes to
transfer such beneficial interest to a Person who shall
take delivery thereof in the form of a Definitive Note
that does not bear the Private Placement Legend, a
certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(iv) Beneficial Interests in Unrestricted Global Notes
to Unrestricted Definitive Notes. If any holder of a beneficial
interest in an Unrestricted Global Note proposes to exchange such
beneficial interest for a Definitive Note or to transfer such
beneficial interest to a Person who takes delivery thereof in the form
of a Definitive Note, then, upon satisfaction of the conditions set
forth in Section 2.06(b)(ii) hereof, the Trustee shall cause the
aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(h) hereof, and the Company shall
execute and the Trustee shall authenticate and deliver to the Person
designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c)(iv) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct
the Registrar through instructions from the Depositary and the
Participant or Indirect Participant. The Trustee shall deliver such
Definitive Notes to the Persons in whose names such Notes are so
registered. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(iii) shall not bear the
Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) Restricted Definitive Notes to Beneficial Interests
in Restricted Global Notes. If any Holder of a Restricted Definitive
Note proposes to exchange such Note for
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a beneficial interest in a Restricted Global Note or to transfer such
Restricted Definitive Note to a Person who takes delivery thereof in
the form of a beneficial interest in a Restricted Global Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive
Note proposes to exchange such Note for a beneficial interest
in a Restricted Global Note, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications in
item (2)(b) thereof;
(B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A under the
Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (1)
thereof;
(C) if such Restricted Definitive Note is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities Act,
a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144
under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (3)(a) thereof;
(E) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of
the Securities Act other than those listed in subparagraphs
(B) through (D) above, a certificate to the effect set forth
in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable;
(F) if such Restricted Definitive Note is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being
transferred pursuant to an effective registration statement
under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or
cause to be increased the aggregate principal amount of, in the case of
clause (A) above, the appropriate Restricted Global Note, in the case
of clause (B) above, the 144A Global Note, in the case of clause (C)
above, the Regulation S Global Note, and, in all other cases, the IAI
Global Note.
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(ii) Restricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A Holder of a Restricted
Definitive Note may exchange such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Restricted Definitive Note to
a Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note only if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the
Registration Rights Agreement and the Holder, in the case of
an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is
not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Definitive
Notes proposes to exchange such Notes for a beneficial
interest in the Unrestricted Global Note, a certificate
from such Holder in the form of Exhibit C hereto,
including the certifications in item (1)(c) thereof; or
(2) if the Holder of such Definitive
Notes proposes to transfer such Notes to a Person who
shall take delivery thereof in the form of a beneficial
interest in the Unrestricted Global Note, a certificate
from such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in this
Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A Holder of an Unrestricted
Definitive Note may exchange such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Definitive Notes to a
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43
Person who takes delivery thereof in the form of a beneficial interest
in an Unrestricted Global Note at any time. Upon receipt of a request
for such an exchange or transfer, the Trustee shall cancel the
applicable Unrestricted Definitive Note and increase or cause to be
increased the aggregate principal amount of one of the Unrestricted
Global Notes.
If any such exchange or transfer from a Definitive Note to a beneficial
interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or
(iii) above at a time when an Unrestricted Global Note has not yet been
issued, the Company shall issue and, upon receipt of an Authentication
Order in accordance with Section 2.02 hereof, the Trustee shall
authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of Definitive Notes so
transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such Holder's compliance
with the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(i) Restricted Definitive Notes to Restricted
Definitive Notes. Any Restricted Definitive Note may be transferred to
and registered in the name of Persons who take delivery thereof in the
form of a Restricted Definitive Note if the Registrar receives the
following:
(A) if the transfer will be made pursuant to
Rule 144A under the Securities Act, then the transferor must
deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof;
(B) if the transfer will be made pursuant to
Rule 903 or Rule 904, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and
(C) if the transfer will be made pursuant to any
other exemption from the registration requirements of the
Securities Act, then the transferor must deliver a certificate
in the form of Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted
Definitive Notes. Any Restricted Definitive Note may be exchanged by
the Holder thereof for an Unrestricted Definitive Note or transferred
to a Person or Persons who take delivery thereof in the form of an
Unrestricted Definitive Note if:
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(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the
Registration Rights Agreement and the Holder, in the case of
an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is
not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to
the Shelf Registration Statement in accordance with the
Registration Rights Agreement;
(C) any such transfer is effected by a
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights
Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted
Definitive Notes proposes to exchange such Notes for an
Unrestricted Definitive Note, a certificate from such
Holder in the form of Exhibit C hereto, including the
certifications in item (1)(d) thereof; or
(2) if the Holder of such Restricted
Definitive Notes proposes to transfer such Notes to a
Person who shall take delivery thereof in the form of
an Unrestricted Definitive Note, a certificate from
such Holder in the form of Exhibit B hereto, including
the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Company to the effect that such
exchange or transfer is in compliance with the Securities Act
and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted
Definitive Notes. A Holder of Unrestricted Definitive Notes may
transfer such Notes to a Person who takes delivery thereof in the form
of an Unrestricted Definitive Note. Upon receipt of a request to
register such a transfer, the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer
in accordance with the Registration Rights Agreement, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section 2.02,
the Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons that
certify in the applicable Letters of Transmittal that (x) they are not
broker-dealers, (y) they are not participating in a distribution of the Exchange
Notes and (z) they are not affiliates (as defined
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45
in Rule 144) of the Company, and accepted for exchange in the Exchange Offer and
(ii) Definitive Notes in an aggregate principal amount equal to the principal
amount of the Restricted Definitive Notes accepted for exchange in the Exchange
Offer. Concurrently with the issuance of such Notes, the Trustee shall cause the
aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company shall execute and the Trustee shall
authenticate and deliver to the Persons designated by the Holders of Definitive
Notes so accepted Definitive Notes in the appropriate principal amount.
(g) Legends. The following legends shall appear on the face of
all Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B)
below, each Global Note and each Definitive Note (and all
Notes issued in exchange therefor or substitution thereof)
shall bear the legend in substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), [AND THE ISSUER HAS NOT
BEEN REGISTERED UNDER THE UNITED STATES INVESTMENT COMPANY ACT OF 1940,
AS AMENDED (THE "INVESTMENT COMPANY ACT")][to be included only in the
Notes for so long as a 3(c)(7) Issuer is an obligor under the Notes],
AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY
ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (A
"QIB");
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS
SECURITY (OR ANY INTEREST HEREIN) EXCEPT (A) TO THE COMPANY OR ANY OF
ITS SUBSIDIARIES, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES
IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE ACT, (D) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO
THE COMPANY) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION;
AND [to be issued while a 3(c)(7) Issuer is an obligor under the Notes]
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[The following shall be used in lieu of the preceding legend
once no 3(c)(7) Issuer is an obligor under the Notes:]
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS
SECURITY EXCEPT (A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN COMPLIANCE WITH RULE 144A
UNDER THE ACT, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION
IN COMPLIANCE WITH RULE 904 UNDER THE ACT, (D) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE ACT (IF
AVAILABLE), (E) TO AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO
THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE REGISTRATION OF TRANSFER OF THIS NOTE (THE
FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH
TRANSFER IS IN RESPECT OF AN ACCRETED VALUE OR AGGREGATE PRINCIPAL
AMOUNT OF NOTES AT THE TIME OF TRANSFER OF LESS THAN $250,000, AN
OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN
COMPLIANCE WITH THE ACT OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT AND, IN EACH CASE, IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS; AND
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND
"U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION
S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS
SECURITY IN VIOLATION OF THE FOREGOING RESTRICTIONS.
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS
SECURITY OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND.
Each Note will also contain a legend to the following effect
for so long as a 3(c)(7) Issuer is an obligor under the Notes:
"THIS NOTE (AND ANY INTEREST HEREIN) MAY BE PURCHASED SOLELY
BY INVESTORS WHO DEMONSTRATE TO THE ISSUER'S SATISFACTION THAT THEY
MEET THE DEFINITION OF A "QUALIFIED PURCHASER" OR A "KNOWLEDGEABLE
EMPLOYEE" FOR THE PURPOSE OF SECTION 3(C)(7) OF THE INVESTMENT COMPANY
ACT OF 1940, AS AMENDED, AND THE RULES THEREUNDER."
(B) Notwithstanding the foregoing, any Global
Note or Definitive Note issued pursuant to subparagraphs
(b)(iv), (c)(iii), (c)(iv), (d)(ii), (d)(iii),
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(e)(ii), (e)(iii) or (f) of this Section 2.06 (and all Notes
issued in exchange therefor or substitution thereof) shall not
bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a
legend in substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR
THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT
(I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE
REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS
GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT
TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE
MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO
SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF EMMIS ESCROW CORPORATION."
(iii) Regulation S Temporary Global Note Legend. The
Regulation S Temporary Global Note shall bear a legend in substantially
the following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL
NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE
FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS
DEFINED HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS
OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON."
(iv) ERISA Legend. Each Global Note and each Definitive
Note (and all Notes issued in exchange therefor or substitution
thereof) shall bear the legend in substantially the following form:
PRIOR TO THE ESCROW CORP. MERGER OR THE EXCHANGE OF THE NOTES
FOR THE EXCHANGEABLE PREFERRED STOCK, EACH PURCHASER
REPRESENTS AND COVENANTS THAT IT IS NOT AND WILL NOT BECOME,
AND IS NOT ACQUIRING THE SECURITIES WITH THE ASSETS OF OR FOR
OR ON BEHALF OF, AND WILL NOT SELL OR OTHERWISE TRANSFER THE
SECURITIES TO ANY "EMPLOYEE BENEFIT PLAN" (AS DEFINED IN
SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA")) SUBJECT TO TITLE I OF ERISA, ANY
"PLAN" SUBJECT TO SECTION 4975 OF THE CODE OR ANY ENTITY WHOSE
UNDERLYING ASSETS INCLUDE THE ASSETS OF ANY SUCH EMPLOYEE
BENEFIT
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PLAN OR PLAN (ANY SUCH EMPLOYEE BENEFIT PLAN, PLAN OR ENTITY,
A "PLAN"). AT AND FOLLOWING THE ESCROW CORP. MERGER, EACH
PURCHASER REPRESENTS AND COVENANTS THAT IT IS NOT AND WILL NOT
BECOME, AND IS NOT ACQUIRING THE SECURITIES WITH THE ASSETS
OF, OR FOR OR ON BEHALF OF, AND WILL NOT SELL OR OTHERWISE
TRANSFER THE SECURITIES TO ANY PLAN EXCEPT TO THE EXTENT THAT
THE ACQUISITION AND HOLDING OF THE SECURITIES IS EXEMPT FROM
THE PROHIBITED TRANSACTION PROVISIONS OF ERISA AND THE CODE BY
REASON OF: (A) PROHIBITED TRANSACTION CLASS EXEMPTION 91-38
ISSUED BY THE DEPARTMENT OF LABOR; (B) PROHIBITED TRANSACTION
CLASS EXEMPTION 90-1 ISSUED BY THE DEPARTMENT OF LABOR; (C)
PROHIBITED TRANSACTION CLASS EXEMPTION 84-14 ISSUED BY THE
DEPARTMENT OF LABOR; (D) PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 ISSUED BY THE DEPARTMENT OF LABOR; OR (E)
PROHIBITED TRANSACTION CLASS EXEMPTION 96-23 ISSUED BY THE
DEPARTMENT OF LABOR.
(h) Cancellation and/or Adjustment of Global Notes. At such
time as all beneficial interests in a particular Global Note have been exchanged
for Definitive Notes or a particular Global Note has been redeemed, repurchased
or canceled in whole and not in part, each such Global Note shall be returned to
or retained and canceled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof
in the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount at maturity of Notes represented by such Global Note
shall be reduced accordingly and an endorsement shall be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee to
reflect such reduction; and if the beneficial interest is being exchanged for or
transferred to a Person who will take delivery thereof in the form of a
beneficial interest in another Global Note, such other Global Note shall be
increased accordingly and an endorsement shall be made on such Global Note by
the Trustee or by the Depositary at the direction of the Trustee to reflect such
increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges,
the Company shall execute and the Trustee shall authenticate Global
Notes and Definitive Notes upon the Company's order or at the
Registrar's request.
(ii) No service charge shall be made to a holder of a
beneficial interest in a Global Note or to a Holder of a Definitive
Note for any registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than
any such transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Sections 2.10, 3.06, 3.09, 4.10, 4.14
and 9.05 hereof).
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(iii) The Registrar shall not be required to register
the transfer of or exchange any Note selected for redemption in whole
or in part, except the unredeemed portion of any Note being redeemed in
part.
(iv) All Global Notes and Definitive Notes issued upon
any registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as
the Global Notes or Definitive Notes surrendered upon such registration
of transfer or exchange.
(v) The Company shall not be required (A) to issue, to
register the transfer of or to exchange any Notes during a period
beginning at the opening of business 15 days before the day of any
selection of Notes for redemption under Section 3.02 hereof and ending
at the close of business on the day of selection, (B) to register the
transfer of or to exchange any Note so selected for redemption in whole
or in part, except the unredeemed portion of any Note being redeemed in
part or (C) to register the transfer of or to exchange a Note between a
record date and the next succeeding Interest Payment Date.
(vi) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Company may deem
and treat the Person in whose name any Note is registered as the
absolute owner of such Note for the purpose of receiving payment of
principal of and interest on such Notes and for all other purposes, and
none of the Trustee, any Agent or the Company shall be affected by
notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and
Definitive Notes in accordance with the provisions of Section 2.02
hereof.
(viii) All certifications, certificates and Opinions of
Counsel required to be submitted to the Registrar pursuant to this
Section 2.06 to effect a registration of transfer or exchange may be
submitted by facsimile.
(ix) For so long as any 3(c)(7) Issuer is an obligor
under the Notes, no transfer of a Note or a beneficial interest in a
Note may occur unless the Registrar has received a statement to the
effect that the transferor reasonably believes that the transferee is
both a QIB and a Qualified Purchaser (as defined in Section 2(i) of
Exhibit E hereto).
(x) Prior to the Escrow Corp. Merger or the exchange of
the Notes for the Exchangeable Preferred Stock, transferee shall be
deemed to represent and covenant that it is not and will not become,
and is not acquiring the securities with the assets of or for or on
behalf of, and will not sell or otherwise transfer the securities to
any "employee benefit plan" (as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) subject
to Title I of ERISA, any "plan" subject to Section 4975 of the Code or
any entity whose underlying assets include the assets of any such
employee benefit plan or plan (any such employee benefit plan, plan or
entity, a "Plan").
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(xi) At and following the Escrow Corp. Merger, each
transferee shall be deemed to represent and covenant that it is not and
will not become, and is not acquiring the securities with the assets
of, or for or on behalf of, and will not sell or otherwise transfer the
securities to any Plan except to the extent that the acquisition and
holding of the securities is exempt from the prohibited transaction
provisions of ERISA and the Code by reason of: (A) Prohibited
Transaction Class Exemption 91-38 issued by the Department of Labor;
(B) Prohibited Transaction Class Exemption 90-1 issued by the
Department of Labor; (C) Prohibited Transaction Class Exemption 84-14
issued by the Department of Labor; (D) Prohibited Transaction Class
Exemption 95-60 issued by the Department of Labor; or (E) Prohibited
Transaction Class Exemption 96-23 issued by the Department of Labor.
Section 2.07. Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the
Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and the Trustee,
upon receipt of an Authentication Order, shall authenticate a replacement Note
if the Trustee's requirements are met. If required by the Trustee or the
Company, an indemnity bond must be supplied by the Holder that is sufficient in
the judgment of the Trustee and the Company to protect the Company, the Trustee,
any Agent and any authenticating agent from any loss that any of them may suffer
if a Note is replaced. The Company may charge for its expenses in replacing a
Note.
Every replacement Note is an additional obligation of the
Company and shall be entitled to all of the benefits of this Indenture equally
and proportionately with all other Notes duly issued hereunder.
Section 2.08. Outstanding Notes.
The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those canceled by it, those delivered to
it for cancellation, those reductions in the interest in a Global Note effected
by the Trustee in accordance with the provisions hereof, and those described in
this Section as not outstanding. Except as set forth in Section 2.09 hereof, a
Note does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note; however, Notes held by the Company or a Subsidiary of
the Company shall not be deemed to be outstanding for purposes of Section
3.07(b) hereof.
If a Note is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Note is held by a bona fide purchaser.
If the principal amount or Accreted Value of any Note is
considered paid under Section 4.01 hereof, it ceases to be outstanding and
interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or
an Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on
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that date, then on and after that date such Notes shall be deemed to be no
longer outstanding and shall cease to accrue interest.
Section 2.09. Treasury Notes.
In determining whether the Holders of the required principal
amount or Accreted Value of Notes have concurred in any direction, waiver or
consent, Notes owned by the Company, or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Company, shall be considered as though not outstanding, except that for the
purposes of determining whether the Trustee shall be protected in relying on any
such direction, waiver or consent, only Notes that the Trustee knows are so
owned shall be so disregarded.
Section 2.10. Temporary Notes.
Until certificates representing Notes are ready for delivery,
the Company may prepare and the Trustee, upon receipt of an Authentication
Order, shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of Definitive Notes but may have variations that the
Company considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Company shall prepare
and the Trustee shall authenticate Definitive Notes in exchange for temporary
Notes.
Holders of temporary Notes shall be entitled to all of the
benefits of this Indenture.
Section 2.11. Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall destroy
canceled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Notes shall be delivered
to the Company. The Company may not issue new Notes to replace Notes that it has
paid or that have been delivered to the Trustee for cancellation.
Section 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the Notes,
it shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment. The Company shall fix or cause to be fixed
each such special record date and payment date, provided that no such special
record date shall be less than 10 days prior to the related payment date for
such defaulted interest. At least 15 days before the special record date, the
Company (or, upon the written request of the Company, the Trustee in the name
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and at the expense of the Company) shall mail or cause to be mailed to Holders a
notice that states the special record date, the related payment date and the
amount of such interest to be paid.
Section 2.13. Investment Company Act.
For so long as a 3(c)(7) Issuer is an obligor under the Notes,
the provisions set forth on Exhibit E hereof relating to certain requirements
under Section 3(c)(7) of the Investment Company Act of 1940, as amended, shall
apply and be of full force and effect. Upon the completion of the Escrow Corp.
Merger, such that a 3(c)(7) Issuer is no longer an obligor under the Notes, the
provisions set forth on Exhibit E hereof shall automatically terminate.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 30 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth (i) the clause of this Indenture pursuant to
which the redemption shall occur, (ii) the redemption date, (iii) the principal
amount at maturity of Notes to be redeemed and (iv) the redemption price.
Section 3.02. Selection of Notes to Be Redeemed.
If less than all of the Notes are to be redeemed or purchased
in an offer to purchase at any time, the Trustee shall select the Notes to be
redeemed or purchased among the Holders of the Notes in compliance with the
requirements of the principal national securities exchange, if any, on which the
Notes are listed or, if the Notes are not so listed, on a pro rata basis, by lot
or in accordance with any other method the Trustee considers fair and
appropriate. In the event of partial redemption by lot, the particular Notes to
be redeemed shall be selected, unless otherwise provided herein, not less than
30 nor more than 60 days prior to the redemption date by the Trustee from the
outstanding Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of
the Notes selected for redemption and, in the case of any Note selected for
partial redemption, the principal amount at maturity thereof to be redeemed.
Notes and portions of Notes selected shall be in amounts of $1,000 aggregate
principal amount at maturity or whole multiples of $1,000 aggregate principal
amount at maturity; except that if all of the Notes of a Holder are to be
redeemed, the entire outstanding amount of Notes held by such Holder, even if
not a multiple of $1,000 aggregate principal amount at maturity, shall be
redeemed. Except as provided in the preceding sentence, provisions of this
Indenture that apply to Notes called for redemption also apply to portions of
Notes called for redemption.
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Section 3.03. Notice of Redemption.
Subject to the provisions of Section 3.09 hereof, at least 30 days
but not more than 60 days before a redemption date, the Company shall mail or
cause to be mailed, by first class mail, a notice of redemption to each Holder
whose Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the
principal amount at maturity of such Note to be redeemed and that, after the
redemption date upon surrender of such Note, a new Note or Notes in principal
amount at maturity equal to the unredeemed portion shall be issued upon
cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption shall cease to accrete or
accrue interest on and after the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.
Section 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
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Section 3.05. Deposit of Redemption Price.
One Business Day prior to the redemption date, the Company shall
deposit with the Trustee or with the Paying Agent money sufficient to pay the
redemption price of and accrued interest on all Notes to be redeemed on that
date. The Trustee or the Paying Agent shall promptly return to the Company any
money deposited with the Trustee or the Paying Agent by the Company in excess of
the amounts necessary to pay the redemption price of, and accrued interest on,
all Notes to be redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, the Notes or the portions of Notes
called for redemption shall cease to accrete or accrue interest. If a Note is
redeemed on or after an interest record date but on or prior to the related
interest payment date, then any accrued and unpaid interest shall be paid to the
Person in whose name such Note was registered at the close of business on such
record date. If any Note called for redemption shall not be so paid upon
surrender for redemption because of the failure of the Company to comply with
the preceding paragraph, interest shall be paid on the unpaid principal, from
the redemption date until such principal is paid, and to the extent lawful on
any interest not paid on such unpaid principal, in each case at the rate
provided in the Notes and in Section 4.01 hereof.
Section 3.06. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount at maturity to the unredeemed portion of the Note surrendered.
Section 3.07. Optional Redemption.
(a) Except as set forth in clause (b) of this Section 3.07, the
Company shall not have the option to redeem the Notes pursuant to this Section
3.07 prior to March 15, 2006. Thereafter, the Company shall have the option to
redeem the Notes, in whole or in part, at the redemption prices (expressed as
percentages of principal amount) set forth below plus accrued and unpaid
interest and Liquidated Damages thereon, if any, to the applicable redemption
date, if redeemed during the twelve-month period beginning on March 15 of the
years indicated below:
Year Percentage
---- ----------
2006.................................................. 106.250%
2007.................................................. 104.167%
2008.................................................. 102.083%
2009 and thereafter................................... 100.000%
(b) Notwithstanding the provisions of clause (a) of this Section
3.07, at any time prior to March 15, 2004 the Company may on any one or more
occasions redeem Notes with the net cash proceeds of one or more Equity
Offerings at a redemption price equal to
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112.5% of the Accreted Value thereof plus Liquidated Damages thereon, if any, to
the redemption date; provided that at least 65% in aggregate principal amount at
maturity of the Notes originally issued under this Indenture remains outstanding
immediately after the occurrence of such redemption (excluding Notes held by the
Company and its Subsidiaries) and that such redemption occurs within 90 days
after the date of the closing of such Equity Offering.
At any time prior to March 15, 2006, the Company may also redeem all
or a part of the Notes upon not less than 30 nor more than 60 days notice mailed
by first class mail to each Holder's registered address, at a redemption price
equal to 100% of the Accreted Value thereof plus the Applicable Premium as of,
and Liquidated Damages, if any, to the date of redemption (the "Redemption
Date").
(c) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.06 hereof.
Section 3.08. Mandatory Redemption.
The Company shall not be required to make mandatory redemption or
sinking fund payments with respect to the Notes.
Section 3.09. Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.10 hereof, the Company
shall be required to commence an offer to all Holders to purchase Notes (an
"Asset Sale Offer"), it shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20 Business
Days following its commencement and no longer, except to the extent that a
longer period is required by applicable law (the "Offer Period"). No later than
five Business Days after the termination of the Offer Period (the "Purchase
Date"), the Company shall purchase the principal amount at maturity of Notes
required to be purchased pursuant to Section 4.10 hereof (the "Offer Amount")
or, if less than the Offer Amount has been tendered, all Notes tendered in
response to the Asset Sale Offer. Payment for any Notes so purchased shall be
made in the same manner as interest payments are made.
If the Purchase Date is on or after an interest record date and on
or before the related interest payment date, any accrued and unpaid interest
shall be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company shall
send, by first class mail, a notice to the Trustee and each of the Holders, with
a copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The Asset Sale Offer shall be made to all Holders. The notice, which
shall govern the terms of the Asset Sale Offer, shall state:
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(a) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.10 hereof and the length of time the Asset Sale Offer shall
remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall
continue to accrete or accrue interest;
(d) that, unless the Company defaults in making such payment, any
Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrete or accrue interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer may elect to have Notes purchased in integral multiples of
$1,000 of principal amount at maturity only;
(f) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Company, a depositary, if appointed by
the Company, or a Paying Agent at the address specified in the notice at least
three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, any Depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Company shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount at maturity to the unpurchased
portion of the Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by the Company in accordance
with the terms of this Section 3.09. The Company, the Depositary or the Paying
Agent, as the case may be, shall promptly (but in any case not later than five
days after the Purchase Date) mail or deliver to each tendering Holder an amount
equal to the purchase price of the Notes tendered by such Holder and accepted by
the Company for purchase, and the Company shall promptly issue a new Note, and
the Trustee, upon written request from the Company shall authenticate and mail
or
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deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
shall publicly announce the results of the Asset Sale Offer on the Purchase
Date.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the provisions
of Sections 3.01 through 3.06 hereof.
Section 3.10. Mandatory Exchange
(a) In the event that the Reorganization has not been completed
within 120 days following the date of the issuance of the Notes, all and not
less than all of the Notes then outstanding shall be mandatorily converted into
shares of Exchangeable Preferred Stock.
Upon any exchange pursuant to the preceding paragraph, and subject
to the next sentence of this paragraph, holders of the outstanding Notes will be
entitled to receive $1.00 of the aggregate liquidation preference of
Exchangeable Preferred Stock for each $1.00 in Accreted Value thereof. The
Exchangeable Preferred Stock shall be issued with a liquidation preference of
$1,000 per share, provided that Emmis (or Emmis Holdings) may pay cash in lieu
of issuing a share of Exchangeable Preferred Stock having a liquidation
preference amount less than $1,000.
The terms of the Exchangeable Preferred Stock are set forth in the
Annex to Articles.
(b) Emmis (or Emmis Holdings) or its representative shall send
notice of the exchange by first class mail, postage prepaid, to each Holder at
its registered address. In addition to any information required by law or by the
applicable rules of any exchange upon which notes may be listed or admitted to
trading, the notice shall state:
(1) the Stock Issue Date;
(2) the place or places where the original certificates are to
be surrendered for exchange, including any procedures applicable to exchanges to
be accomplished through book-entry transfers; and
(3) that the Notes to be exchanged will cease to accrete and
interest, if any, will cease to accrue thereon, on the Stock Issue Date.
(c) If the notice of the exchange has been properly given, and if,
on or before the Stock Issue Date, the shares of Exchangeable Preferred Stock
have been deposited with the transfer agent, then on and after the close of
business on the Stock Issue Date:
(1) the Notes to be exchanged shall no longer be considered
outstanding; and
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(2) all rights of the holders as noteholders of the Company
shall cease, except their right to receive upon surrender of their certificates
the shares of Exchangeable Preferred Stock.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
The Company shall pay or cause to be paid the principal or Accreted
Value of, premium, if any, and interest on the Notes on the dates and in the
manner provided in the Notes. Principal or Accreted Value, premium, if any, and
interest shall be considered paid on the date due if the Paying Agent, if other
than the Company or a Subsidiary thereof, holds as of 10:00 a.m. New York City
Time on the due date money deposited by the Company in immediately available
funds and designated for and sufficient to pay all principal or Accreted Value,
premium, if any, and interest then due. The Company shall pay all Liquidated
Damages, if any, in the same manner on the dates and in the amounts set forth in
the Registration Rights Agreement.
The Company shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal at the rate equal
to 1% per annum in excess of the then applicable interest rate on the Notes to
the extent lawful; it shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace period) at the same
rate to the extent lawful.
Section 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, the City of
New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
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The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03.
Section 4.03. Reports.
(a) Whether or not required by the SEC, so long as any Notes are
outstanding, the Company shall furnish to the Holders of Notes, within the time
periods specified in the SEC's rules and regulations: (i) all quarterly and
annual financial information that would be required to be contained in a filing
with the SEC on Forms 10-Q and 10-K if the Company were required to file such
forms, including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and, with respect to the annual information only, a
report on the annual financial statements by the Company's certified independent
accountants; and (ii) all current reports that would be required to be filed
with the SEC on Form 8-K if the Company were required to file such reports. In
addition, following the consummation of the Exchange Offer, whether or not
required by the SEC, the Company shall file a copy of all of the information and
reports referred to in clauses (i) and (ii) above with the SEC for public
availability within the time periods specified in the SEC's rules and
regulations (unless the SEC will not accept such a filing) and make such
information available to securities analysts and prospective investors upon
request. The Company shall at all times comply with TIA Section 314(a). Until
the Escrow Corp. Merger has been completed, the reports of Emmis on Forms 10-Q,
10-K and 8-K shall be deemed to satisfy the requirements of this Section
4.03(a).
(b) For so long as any Notes remain outstanding and (i) the
Commission does not accept the filings provided for in paragraph (a) of this
Section or (ii) such filings provided for in paragraph (a) of this Section do
not contain the information required to be delivered upon request pursuant to
Rule 144A(d)(4) under the Securities Act, the Company shall furnish to the
Holders and to securities analysts and prospective investors, upon their
request, the information required to be delivered pursuant to Rule 144(A)(d)(4)
under the Securities Act.
Section 4.04. Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 90 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Company and its Subsidiaries during the preceding fiscal
year has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company is taking or proposes to take with respect thereto.
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(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a) above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article Four or Article Five hereof or, if any such violation
has occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company is taking or proposes to take with
respect thereto.
Section 4.05. Taxes.
The Company shall pay, and shall cause each of its Subsidiaries to
pay, prior to delinquency, all material taxes, assessments, and governmental
levies except such as are contested in good faith and by appropriate proceedings
or where the failure to effect such payment is not adverse in any material
respect to the Holders of the Notes.
Section 4.06. Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so)
that it shall not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay, extension or usury law
wherever enacted, now or at any time hereafter in force, that may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, and covenants that it shall not, by resort to any such law,
hinder, delay or impede the execution of any power herein granted to the
Trustee, but shall suffer and permit the execution of every such power as though
no such law has been enacted.
Section 4.07. Restricted Payments.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(1) declare or pay any dividend or make any other payment or
distribution on account of the Company's or any of its Restricted Subsidiaries'
Equity Interests (including, without limitation, any payment in connection with
any merger or consolidation involving the Company or any of its Restricted
Subsidiaries) or to the direct or indirect holders of the Company's or any of
its Restricted Subsidiaries' Equity Interests in their capacity as such (other
than dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of the Company or to the Company or a Restricted Subsidiary
of the Company).
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(2) purchase, redeem or otherwise acquire or retire for value
(including without limitation, in connection with any merger or consolidation
involving the Company) any Equity Interests of the Company or any direct or
indirect parent of the Company (other than any such Equity Interests owned by
the Company or any Restricted Subsidiary of the Company and other than the
Exchangeable Preferred Stock),
(3) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness of the Company
that is subordinated to the Notes in right of payment, except a payment of
interest or the payment of principal at Stated Maturity thereof, or
(4) make any Restricted Investment (all such payments and other
actions set forth in clauses (1) through (4) above being collectively referred
to as "Restricted Payments");
unless, at the time of and after giving effect to such Restricted Payment:
(1) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(2) the Company would, at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted Payment had been
made at the beginning of the applicable four-quarter period, have been permitted
to incur at least $1.00 of additional Indebtedness pursuant to clause (C) of the
Leverage Ratio test set forth in the first paragraph of Section 4.09 of this
Indenture; and
(3) such Restricted Payment, together with the aggregate amount of
all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the date of this Indenture (excluding Restricted Payments
permitted by clauses (2), (5), (6), (7) and (8) of the next succeeding
paragraph), is less than the sum, without duplication, of:
(a) (i) the aggregate Consolidated EBITDA of the Company for
the period (taken as one accounting period) from the beginning of the
first fiscal quarter commencing after February 12, 1999 to the end of the
Company's most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, in
the event aggregate Consolidated EBITDA for such period is a deficit, then
minus such deficit) less (ii) 1.4 times the aggregate Fixed Charges of the
Company for the same period; plus
(b) the aggregate net cash proceeds and the fair value,
determined in good faith by the Board of Directors, of any non-cash
consideration, in each case, received by the Company since February 12,
1999 as a contribution to its common equity capital or from the issue or
sale of Equity Interests of the Company (other than Disqualified Stock) or
from the issue or sale of convertible or exchangeable Disqualified Stock
or convertible or exchangeable debt securities, of the Company that have
been converted into or exchanged for such Equity Interests (other than
Equity Interests (or Disqualified Stock or debt securities) sold to a
Subsidiary of the Company); plus
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(c) to the extent that any Restricted Investment that was made
after February 12, 1999 is sold for cash or otherwise liquidated or repaid
for cash, the cash return of capital with respect to such Restricted
Investment (less the cost of disposition, if any); plus
(d) if any Unrestricted Subsidiary (A) is redesignated as a
Restricted Subsidiary, the fair market value of such redesignated
Subsidiary (as determined in good faith by the Board of Directors) as of
the date of its redesignation or (B) pays any cash dividends or cash
distributions to the Company or any of its Restricted Subsidiaries, 100%
of any such cash dividends or cash distributions made after February 12,
1999; plus
(e) without, duplication of any of the foregoing, the
aggregate amount returned in cash on or with respect to Restricted
Investments made subsequent to February 12, 1999, whether through interest
payments, principal payments, dividends or other distributions or
payments: plus
(f) $10.0 million.
So long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, the preceding provisions shall not
prohibit:
(1) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration such payment would have
complied with the provisions of this Indenture;
(2) the making of any Investment or the redemption, repurchase,
retirement, defeasance or other acquisition of any Equity Interests of the
Company in exchange for, or out of the proceeds of the sale (other than to a
Subsidiary of the Company) of, any Equity Interests of the Company (other than
any Disqualified Stock); provided that, in each such case, the amount of any
such net cash proceeds that are so utilized shall be excluded from clause (3)(b)
of the preceding paragraph;
(3) the payment of any dividend by a Restricted Subsidiary of the
Company to the holders of its common Equity Interests on a pro rata basis;
(4) the repurchase, redemption or other acquisition or retirement
for value of any Equity Interests of the Company or any Restricted Subsidiary of
the Company held by any former member of the Company's (or any of its Restricted
Subsidiaries') management pursuant to any management equity subscription
agreement or stock option agreement in effect as of the date of this Indenture;
provided that the aggregate price paid for all such repurchased, redeemed,
acquired or retired Equity Interests shall not exceed $1.0 million in any
twelve-month period;
(5) the exchange of the Notes for Exchangeable Preferred Stock in
accordance with the Indenture and the Annex to Articles;
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(6) the repurchase of Equity Interests of the Company deemed to
occur upon the exercise of stock options if such Equity Interests represent a
portion of the exercise price of such options;
(7) the redemption, repurchase, retirement, defeasance or other
acquisition of any subordinated Indebtedness of the Company or of any Equity
Interests of the Company or any Restricted Subsidiary in exchange for, or out of
the proceeds of the sale (other than to a Subsidiary of the Company) of, any
Equity Interests of the Company (other than any Disqualified Stock): provided
that, in each such case, the amount of any such net cash proceeds that are
utilized for any such redemption, repurchase, retirement, defeasance or other
acquisition shall be excluded from clause (3)(b) of the preceding paragraph;
(8) the defeasance, redemption, repurchase or other acquisition of
subordinated Indebtedness of the Company with the net cash proceeds from an
incurrence of Permitted Refinancing Indebtedness;
(9) the repurchase, redemption or other acquisition or retirement
for value of any Equity Interests of the Company in an amount not to exceed
$25.0 million under this clause (9).
In determining whether any payment is permitted by the foregoing
covenant, the Company may allocate or reallocate, among clauses (1) through (9)
of the preceding paragraph or among such clauses and the first paragraph of this
covenant, all or any portion of such payment and all or any portion of any
payment previously allocated; provided that, after giving effect to such
allocation or reallocation, all such payments (or allocated portions of such
payments) would be permitted under the various provisions of this covenant.
The Board of Directors may designate any Restricted Subsidiary to be
an Unrestricted Subsidiary if such designation would not cause a Default or an
Event of Default. For purposes of making such determination, all outstanding
Investments by the Company and its Restricted Subsidiaries (except to the extent
repaid in cash) in the Subsidiary so designated will be deemed to be Restricted
Payments at the time of such designation and will reduce the amount available
for Restricted Payments under the first paragraph of this covenant. All such
outstanding Investments will be deemed to constitute Investments in an amount
equal to the fair market value of such Investments at the time of such
designation. Such designation will only be permitted if such Restricted Payment
would be permitted at such time and if such Restricted Subsidiary otherwise
meets the definition of an Unrestricted Subsidiary. The Board of Directors may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary if such
designation would not cause a Default or Event of Default.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or the applicable
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The fair market value of any property, assets or Investments required by this
covenant to be determined shall be determined by the Board of Directors whose
resolution with respect thereto shall be delivered to the Trustee.
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In making the computations required by this covenant:
(1) the Company may use audited financial statements for the
portions of the relevant period for which audited financial statements are
available on the date of determination and unaudited financial statements and
other current financial data based on the books and records of the Company for
the remaining portion of such period; and
(2) the Company may rely in good faith on the financial statements
and other financial data derived from its books and records that are available
on the date of determination.
If the Company makes a Restricted Payment that, at the time of the
making of such Restricted Payment, would in the good faith determination of the
Company be permitted under the requirements of this Indenture, such Restricted
Payment will be deemed to have been made in compliance with this Indenture
notwithstanding any subsequent adjustments made in good faith to the Company's
financial statements for any period which adjustments affect any of the
financial data used to make the calculations with respect to such Restricted
Payment.
Notwithstanding the foregoing, this Section 4.07 shall not prohibit
the Company from completing the Escrow Corp. Merger or the Reorganization.
Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary to
(1) pay dividends or make any other distributions to the Company or
any of its Restricted Subsidiaries on its Capital Stock or with respect to any
other interest or participation in, or measured by, its profits;
(2) pay any indebtedness owed to the Company or any of its
Restricted Subsidiaries;
(3) make loans or advances to the Company or any of its Restricted
Subsidiaries; or
(4) transfer any of its properties or assets to the Company or any
of its Restricted Subsidiaries.
However, the foregoing restrictions shall not apply to encumbrances
or restrictions existing under or by reason of:
(1) Existing Indebtedness or Indebtedness under the Credit
Facilities, in each case as in effect on the date of this Indenture, and any
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings thereof, provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are no more restrictive, taken as a whole, with
respect to such
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dividend and other payment restrictions than those contained in the Existing
Indebtedness or in the Credit Facilities, in each case as in effect on the date
of this Indenture;
(2) encumbrances and restrictions applicable to any Unrestricted
Subsidiary, as the same are in effect as of the date on which such Subsidiary
becomes a Restricted Subsidiary, and as the same may be amended, modified,
restated, renewed, increased, supplemented, refunded, replaced or refinanced;
provided that such amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacement or refinancings are no more restrictive,
taken as a whole, with respect to such dividend and other payment restrictions
than those contained in the applicable series of Indebtedness of such Subsidiary
as in effect on the date on which such Subsidiary becomes a Restricted
Subsidiary;
(3) any Indebtedness (incurred in compliance with the covenants
under Section 4.09) or any agreement pursuant to which such Indebtedness is
issued if the encumbrance or restriction applies only in the event of a payment
default or default with respect to a financial covenant contained in such
Indebtedness or agreement and such encumbrance or restriction is not materially
more disadvantageous to the holders of the Notes than is customary in comparable
financings (as determined by the Company) or if such encumbrance or restriction
is no more restrictive than those in the Credit Facilities or the Senior
Subordinated Notes Indenture on the date hereof (or, alternatively in the case
of the Senior Subordinated Notes Indenture, on its date);
(4) this indenture and the Notes;
(5) applicable law;
(6) any instrument governing Indebtedness or Capital Stock of a
Person acquired by the Company or any of its Restricted Subsidiaries as in
effect at the time of such acquisition (except to the extent such Indebtedness
was incurred in connection with or in contemplation of such acquisition), which
encumbrance or restriction is not applicable to any Person, or the properties or
assets of any Person, other than the Person, or the property or assets of the
Person, so acquired, provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be incurred;
(7) customary non-assignment provisions in leases or licenses
entered into in the ordinary course of business;
(8) any agreement for the sale or other disposition of a Restricted
Subsidiary that restricts distributions by that Restricted Subsidiary pending
its sale or other disposition;
(9) Permitted Refinancing Indebtedness, provided that the
restrictions contained in the agreements governing such Permitted Refinancing
Indebtedness are no more restrictive, taken as a whole, than those contained in
the agreements governing the Indebtedness being refinanced;
(10) Liens permitted to be incurred pursuant to the provisions of
Section 4.12 of this Indenture that limit the right of the debtor to transfer
the assets subject to such Liens;
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(11) provisions with respect to the disposition or distribution of
assets or property in joint venture agreements and other similar agreements; and
(12) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business.
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred
Stock.
The Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable, contingently or otherwise, with respect to
(collectively, "incur") any Indebtedness (including Acquired Debt), and the
Company shall not issue any Disqualified Stock and shall not permit any of its
Restricted Subsidiaries to issue any shares of preferred stock, provided,
however, that (A) any Restricted Subsidiary may incur Indebtedness (including
Acquired Debt), if the Leverage Ratio of the Restricted Subsidiaries of the
Company, taken as a whole, for the Reference Period immediately preceding the
date on which such additional Indebtedness is incurred or such Disqualified
Stock is issued would not have been greater than 7.0 to 1, (B) the Company may
incur Indebtedness, that is pari passu in right of payment with the Notes
(including Acquired Debt), if the Leverage Ratio of the Company for the
Reference Period immediately preceding the date on which such additional
Indebtedness is incurred is issued would not have been greater than 7.5 to 1 (it
being understood that this clause (B) shall not prohibit or restrict the Company
from guaranteeing any Indebtedness of any Restricted Subsidiary that was
otherwise permitted to be incurred by the terms of this Indenture), and (C) the
Company may incur Indebtedness that is junior in right of payment to the Notes
(including Acquired Debt) and may issue Disqualified Stock, if the Leverage
Ratio of the Company for the Reference Period immediately preceding the date on
which such additional Indebtedness is incurred or such Disqualified Stock is
issued would not have been greater than 8.0 to 1, in the case of each of (A),
(B) or (C) above, determined on a pro forma basis (after giving pro forma effect
to such incurrence or issuance and to the application of the net proceeds
therefrom) and in accordance with the definition of Leverage Ratio.
The provisions of the first paragraph of this covenant shall not
apply to the incurrence of any of the following items of Indebtedness or
preferred stock (collectively, "Permitted Debt"):
(1) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness under the Credit Facilities; provided that the
aggregate amount of all Indebtedness of the Company and the Restricted
Subsidiaries outstanding under the Credit Facilities after giving effect to such
incurrence does not exceed an amount equal to $750.0 million less the aggregate
amount of all Net Proceeds of Asset Sales applied by the Company or any of its
Restricted Subsidiaries since the date of this Indenture to repay Indebtedness
under the Credit Facilities pursuant to Section 4.10 of this Indenture;
(2) the incurrence by the Company and its Restricted Subsidiaries of
the Existing Indebtedness;
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(3) the issuance by the Company of the Notes and the New Notes, the
issuance of the Exchangeable Preferred Stock in exchange for the Notes or the
issuance of the New Preferred Stock in exchange for the New Notes;
(4) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage
financings or purchase money obligations, in each case, incurred for the purpose
of financing all or any part of the purchase price or cost of construction or
improvement of property, plant or equipment used in the business of the Company
or such Restricted Subsidiary, in an aggregate principal amount not to exceed
$5.0 million at any time outstanding;
(5) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net
proceeds of which are used to refund, refinance or replace, Indebtedness of the
Company or any of its Restricted Subsidiaries or Disqualified Stock of the
Company (other than intercompany Indebtedness) that was permitted by this
Indenture to be incurred under the first paragraph hereof or clauses (2), (3),
(4), (8), (9) or (11) of this paragraph;
(6) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Company and any
of its Restricted Subsidiaries; provided, that: (A) any subsequent issuance or
transfer of Equity Interests that results in any such Indebtedness being held by
a Person other than the Company or a Restricted Subsidiary and (B) any sale or
other transfer of any such Indebtedness to a Person that is not either the
Company or a Restricted Subsidiary shall be deemed, in each case, to constitute
an incurrence of such Indebtedness by the Company or such Restricted Subsidiary,
as the case may be;
(7) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing
or hedging foreign currency risk or interest rate risk with respect to any
Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(8) the guarantee by the Company or any of its Restricted
Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the
Company that was permitted to be incurred by another provision of this
Indenture;
(9) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal amount (or
accreted value, as applicable) at any time outstanding, including all Permitted
Refinancing Indebtedness incurred to refund, refinance or replace any
Indebtedness incurred pursuant to this clause (9), not to exceed $25.0 million;
(10) the incurrence by the Company's Unrestricted Subsidiaries of
Non-Recourse Debt; provided, however, that if any such Indebtedness ceases to be
Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to
constitute an incurrence of Indebtedness by a Restricted Subsidiary of the
Company that was not permitted by this clause (10);
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(11) the accrual of interest, accretion or amortization of original
issue discount, the payment of interest on any Indebtedness in the form of
additional Indebtedness with the same terms (provided, in each such case, that
the amount thereof is included in Fixed Charges of the Company as accrued), and
the payment of dividends on Disqualified Stock in the form of additional shares
of the same class of Disqualified Stock; and
(12) the incurrence by the Company or any of its Restricted
Subsidiaries Indebtedness of up to an aggregate principal amount of $250.0
million of Indebtedness under the Credit Facilities for the purpose of acquiring
Permitted Businesses.
For purposes of determining compliance with this covenant, in the
event that an item of Indebtedness or Disqualified Stock meets the criteria of
more than one of the categories of Permitted Debt described in clauses (1)
through (12) above or is entitled to be incurred pursuant to the first paragraph
of this covenant, the Company shall, in its sole discretion, classify (or later
reclassify in whole or in part) such item of Indebtedness or Disqualified Stock
in any manner that complies with this covenant.
Accrual of interest or dividends, accretion or amortization of
original issue discount and the payment of interest or dividends in the form of
additional Indebtedness or Disqualified Stock will not be deemed to be an
incurrence of Indebtedness or Disqualified Stock for purposes of this covenant.
Notwithstanding the foregoing, this Section 4.09 shall not prohibit
the Company from completing the Escrow Corp. Merger or the Reorganization.
Section 4.10. Asset Sales.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(1) the Company (or the Restricted Subsidiary, as the case may be)
receives consideration at the time of such Asset Sale at least equal to the fair
market value of the assets or Equity Interests issued or sold or otherwise
disposed of;
(2) such fair market value is determined by the Company's Board of
Directors and evidenced by a resolution of the Board of Directors set forth in
an Officers' Certificate delivered to the Trustee; and
(3) at least 75% of the consideration therefor received by the
Company or such Restricted Subsidiary is in the form of cash. For purposes of
this provision, each of the following shall be deemed to be cash:
(a) any liabilities (as shown on the Company's or such
Restricted Subsidiary's most recent balance sheet), of the Company
or any Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes in
right of payment) that are assumed by the transferee
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of any such assets pursuant to a customary novation agreement that
releases the Company or such Restricted Subsidiary from further
liability; and
(b) any securities, notes or other obligations received by the
Company or any such Restricted Subsidiary from such transferee that
are converted by the Company or such Restricted Subsidiary into cash
within 30 days after receipt (to the extent of the cash received in
that conversion).
Within 360 days after the receipt of any Net Proceeds from an Asset
Sale, the Company and any Restricted Subsidiary may apply such Net Proceeds at
its option:
(1) to repay senior Indebtedness of the Company and any Indebtedness
of any Restricted Subsidiary;
(2) to acquire all or substantially all of the assets of, or a
majority of the Voting Stock of, another Permitted Business that is owned by the
Company;
(3) to make a capital expenditure, or
(4) to acquire other assets that are used or useful in a Permitted
Business that is owned by the Company.
Pending the final application of any such Net Proceeds, the Company may
temporarily reduce revolving credit borrowings or otherwise invest such Net
Proceeds in any manner that is not prohibited by this Indenture.
Notwithstanding the two immediately preceding paragraphs, the
Company and its Restricted Subsidiaries will be permitted to consummate an Asset
Sale without complying with such paragraphs to the extent (i) at least 75% of
the consideration for such Asset Sale constitutes Productive Assets, cash, Cash
Equivalents and/or Marketable Securities and (ii) such Asset Sale is for fair
market value (as determined in good faith by the Board of Directors and
certified to in an Officers' Certificate); provided that any cash consideration
not constituting Productive Assets received by the Company or any of its
Restricted Subsidiaries in connection with any Asset Sale permitted to be
consummated under this paragraph shall be subject to the provisions of the
preceding paragraphs.
Any Net Proceeds from Asset Sales that are not applied or invested
as provided in the preceding paragraph will constitute Excess Proceeds. When the
aggregate amount of Excess Proceeds exceeds $5.0 million, the Company shall make
an Asset Sale Offer to all holders of the Notes and all holders of other
Indebtedness that is pari passu with the Notes containing provisions similar to
those set forth in this Indenture with respect to offers to purchase or redeem
with the proceeds of sales of assets to purchase the maximum principal amount of
the Notes and such other pari passu Indebtedness that may be purchased out of
the Excess Proceeds. To the extent that any Indebtedness of any Subsidiary
requires that Subsidiary to make an offer similar to an Asset Sale Offer, the
Company and such Subsidiary may make simultaneous offers, with the offer to the
noteholders being limited to proceeds not used to repurchase the Indebtedness of
such Subsidiary. The offer price in any Asset Sale Offer will be equal to 100%
of aggregate
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principal amount at maturity of the Notes to be repurchased, plus accrued and
unpaid dividends and Liquidated Damages thereon, if any, to the date of purchase
(or, in the case of purchases of Notes prior to March 15, 2006 at 100% of the
Accreted Value thereof, plus Liquidated Damages thereon, if any, to the date of
purchase), and will be payable in cash. If any Excess Proceeds remain after
consummation of an Asset Sale Offer, the Company may use such Excess Proceeds
for any purpose not otherwise prohibited by this Indenture. If the aggregate
principal amount at maturity of the Notes and such other pari passu Indebtedness
tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the
Trustee shall select the Notes and such other pari passu Indebtedness to be
purchased on a pro rata basis. Upon completion of each Asset Sale Offer, the
amount of Excess Proceeds shall be reset at zero.
The Asset Sale provisions described above will be applicable whether
or not any other provisions of this Indenture are applicable. The Company shall
comply, to the extent applicable, with the requirements of Section 14(e) of the
Exchange Act and any other securities laws or regulations applicable to any
Asset Sale Offer. To the extent that the provisions of any such securities laws
or securities regulations conflict with the provisions of the covenant described
above, the Company shall comply with the applicable securities laws and
regulations and will not be deemed to have breached its obligations under the
covenant described above by virtue thereof.
Notwithstanding the foregoing, the Company shall not be required to
repurchase any Notes pursuant to this Section 4.10 unless such repurchase
complies with the restricted payments covenants contained in the other
Indebtedness of the Company and its Subsidiaries.
The Escrow Corp. Merger, the Reorganization or a merger with an
Affiliate incorporated for the purpose of reincorporating the Company in another
jurisdiction and/or for the purpose of forming a holding company shall not
constitute an "Asset Sale."
Section 4.11. Transactions with Affiliates.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless:
(1) such Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary than those that
would have been obtained in a comparable transaction by the Company or such
Restricted Subsidiary with an unrelated Person; and
(2) the Company delivers to the Trustee:
(a) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $5.0 million, a resolution of the Board of Directors set
forth in an Officers'
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Certificate certifying that such Affiliate Transaction complies with
clause (1) above and that such Affiliate Transaction has been
approved by a majority of the disinterested members of the Board of
Directors; and
(b) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $10.0 million, an opinion as to the fairness to the
Holders of the financial terms of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or
investment banking firm of national standing.
The following items shall not be deemed to be Affiliate Transactions
and therefore will not be subject to the provisions of the prior paragraph:
(1) any employment or indemnification arrangements or transactions
relating to benefit plans with any employee, consultant or director of the
Company or a Restricted Subsidiary that is entered into by the Company or any of
its Restricted Subsidiaries in the ordinary course of business and consistent
with past practice of the Company or such Restricted Subsidiary;
(2) transactions between or among the Company and/or its Restricted
Subsidiaries;
(3) payment of reasonable directors fees to Persons who are not
otherwise Affiliates of the Company;
(4) Restricted Payments that are permitted by Section 4.07 of this
Indenture;
(5) any tax sharing agreement or administrative service agreement
between the Company or any Restricted Subsidiary and any of its Affiliates
approved by a majority of the independent Directors;
(6) transactions and payments contemplated by any agreement in
effect on the date of this Indenture or any amendment thereto in any replacement
agreement therefor, so long as any such amendment or replacement agreement,
taken as a whole, is not more disadvantageous to the Company or such Restricted
Subsidiary as the original agreement as in effect on the date of this Indenture;
(7) loans and advances to employees of the Company or any Restricted
Subsidiary in the ordinary course of business; and
(8) the Escrow Corp. Merger, the Reorganization and the issuance of
the Exchangeable Preferred Stock in exchange for the Notes and any merger with
an Affiliate incorporated for the purpose of reincorporating the Company in
another jurisdiction and/or for the purpose of forming a holding company.
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Section 4.12. Liens.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien on any asset now owned or hereafter acquired, or any income or
profits therefrom or assign or convey any right to receive income therefrom,
except Permitted Liens, unless all payments due under this Indenture and the
Notes are secured on an equal and ratable basis with the obligations so secured
until such time as such obligations are no longer secured by a Lien.
Section 4.13. Corporate Existence.
Subject to Article Five hereof, the Company shall do or cause to be
done all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each
of its Restricted Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Restricted Subsidiary and (ii) the rights (charter and statutory), licenses
and franchises of the Company and its Restricted Subsidiaries; provided,
however, that the Company shall not be required to preserve any such right,
license or franchise, or the corporate, partnership or other existence of any of
its Restricted Subsidiaries, if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and its Restricted Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders of the Notes.
Section 4.14. Offer to Repurchase Upon Change of Control.
If a Change of Control occurs, each Holder of the Notes will have
the right to require the Company to repurchase all or any part of such holder's
Notes pursuant to the offer described below (the "Change of Control Offer"). In
the Change of Control Offer, the Company shall offer a payment in cash equal to
101% of the aggregate principal amount of the Notes repurchased plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the date of purchase
(or if such a Change of Control Offer is made prior to March 15, 2006 at 101% of
the Accreted Value of the Notes on the date of purchase, plus Liquidated Damages
on them, if any, to the date of purchase) (the "Change of Control Payment") .
Within 30 days following any Change of Control, the Company shall mail a notice
to each holder describing the transaction or transactions that constitute the
Change of Control and offering to repurchase the Notes on the date specified in
such notice, which date shall be no earlier than 30 days and no later than 60
days from the date such notice is mailed (the "Change of Control Payment Date"),
pursuant to the procedures required by this Indenture and described in such
notice.
On the Change of Control Payment Date, the Company shall, to the
extent lawful:
(1) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer;
(2) deposit with the Paying Agent an amount equal to the Change of
Control Payment in respect of all Notes or portions thereof so tendered; and
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(3) deliver or cause to be delivered to the Trustee the Notes so
accepted together with an Officers' Certificate stating the aggregate principal
amount at maturity of the Notes or portions thereof being purchased by the
Company.
The Company shall promptly mail to each Holder of the Notes so
tendered the Change of Control Payment for such Notes, and the Trustee will
promptly authenticate and mail (or cause to be transferred by book entry) to
each holder a new certificate representing the Notes equal in principal amount
at maturity to any unpurchased portion of the Notes surrendered, if any.
The Company shall not be required to make a Change of Control Offer
upon a Change of Control if a third party makes the Change of Control Offer in
the manner, at the times and otherwise in compliance with the requirements set
forth in this Indenture applicable to a Change of Control Offer made by the
Company and purchases all Notes validly tendered and not withdrawn under such
Change of Control Offer. The provisions under this Indenture relative to the
Company's obligation to make an offer to repurchase the Notes as a result of a
Change of Control may be waived or modified with the written consent of the
holders of a majority in principal amount at maturity of the Notes then
outstanding.
The Escrow Corp. Merger, the Reorganization, or a merger with an
Affiliate incorporated for the purpose of reincorporating the Company in another
jurisdiction and/or for the purpose of forming a holding company shall not
constitute a "Change of Control."
The provisions of this Section 4.14 shall be applicable regardless
of whether or not any other provisions of this Indenture are applicable. Except
to the extent of the provisions of this Section 4.14, this Indenture does
provide for the right of the Holders of the Notes to require that the Company
repurchase or redeem the Notes in the event of a takeover, recapitalization or
similar transaction.
Section 4.15. Limitation on Issuances and Sales of Equity Interests
in Wholly Owned Subsidiaries.
The Company:
(1) will not, and will not permit any Restricted Subsidiary of the
Company to, transfer, convey, sell, lease or otherwise dispose of any Equity
Interests in any Restricted Subsidiary of the Company to any Person (other than
the Company or a Wholly Owned Restricted Subsidiary of the Company); and
(2) will not permit any Restricted Subsidiary of the Company to
issue any of its Equity Interests (other than, if necessary, shares of its
Capital Stock constituting directors' qualifying shares) to any Person other
than to the Company or a Wholly Owned Restricted Subsidiary of the Company.
unless, in each such case: (a) as a result of such transfer, conveyance, sale
lease or other disposition or issuance such Restricted Subsidiary no longer
constitutes a Subsidiary and (b) the
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cash Net Proceeds from such transfer, conveyance, sale, lease or other
disposition or issuance are applied in accordance with the provisions of Section
4.14.
Section 4.16. Calculation of Original Issue Discount.
The Company shall file with the Trustee promptly at the end of each
calendar year (i) a written notice specifying the amount of original issue
discount (including daily rates and accrual periods) accrued on the outstanding
Notes as of the end of such year and (ii) such other specific information
relating to such original issue discount as may then be relevant under the
Internal Revenue Code of 1986, as amended from time to time.
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets.
The Company may not consolidate or merge with or into (whether or
not Company is the surviving corporation), or sell, assign, transfer, lease,
convey, or otherwise dispose of all or substantially all of its properties or
assets in one or more related transactions, to another corporation, Person or
entity unless:
(1) the Company is the surviving corporation or the entity or the
Person formed by or surviving any such consolidation or merger (if other than
the Company) or to which such sale, assignment, transfer, lease, conveyance or
other disposition shall have been made is a corporation organized or existing
under the laws of the United States, any state thereof or the District of
Columbia;
(2) the entity or Person formed by or surviving any such
consolidation or merger (if other than the Company) or the entity or Person to
which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made assumes all the obligations of the Company under the Notes
and this Indenture pursuant to a supplemental indenture in a form reasonably
satisfactory to the Trustee;
(3) immediately after such transaction no Default exists; and
(4) the Company or the entity or Person formed by or surviving any
such consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made
(a) will have a Consolidated Net Worth immediately after the
transaction equal to or greater than the Consolidated Net Worth of
the Company immediately preceding the transaction; and
(b) will, at the time of such transaction and after giving pro
forma effect thereto as if such transaction had occurred at the
beginning of the applicable four-quarter period, be permitted to
incur at least $1.00 of additional Indebtedness
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pursuant to clause (C) of the Leverage Ratio test set forth in the
first paragraph of Section 4.09.
Notwithstanding the foregoing, the Company may consummate the Escrow
Corp. Merger or the Reorganization, or merge with an Affiliate incorporated for
the purpose of reincorporating the Company in another jurisdiction and/or for
the purpose of forming a holding company without complying with paragraphs 3 and
4 of this Section 5.01.
This Section 5.01 will not apply to a sale, assignment, transfer,
conveyance or other disposition of assets between or among the Company and any
of its Wholly Owned Restricted Subsidiaries.
Section 5.02. Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in accordance with Section 5.01 hereof, the successor corporation
formed by such consolidation or into or with which the Company is merged or to
which such sale, assignment, transfer, lease, conveyance or other disposition is
made shall succeed to, and be substituted for (so that from and after the date
of such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" or "Emmis" shall refer
instead to the successor corporation and not to the Company), and may exercise
every right and power of the Company under this Indenture with the same effect
as if such successor Person had been named as the Company herein; provided,
however, that the predecessor Company shall not be relieved from the obligation
to pay the principal of and interest on the Notes except in the case of a
consolidation, merger or sale, assignment, transfer, lease, conveyance or other
disposition of all of the Company's assets that meets the requirements of
Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(a) the Company defaults in the payment when due of interest on, or
Liquidated Damages with respect to, the Notes, and such default continues for a
period of 30 days;
(b) the Company defaults in the payment when due of principal or
Accreted Value of or premium, if any, on the Notes when the same becomes due and
payable at maturity, upon redemption (including in connection with an offer to
purchase) or otherwise;
(c) the Company or any of its Subsidiaries fails, for 30 days after
notice to the Company by the Trustee or the Holders of at least 25% in aggregate
principal amount at maturity of the Notes then outstanding voting as a single
class, to comply with Sections 5.01 or 5.02 of
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this Indenture or to consummate a Change of Control Offer or Asset Sale Offer in
accordance with Sections 4.10 and 4.14 of this Indenture;
(d) the Company or any of its Restricted Subsidiaries fails to
observe or perform any other covenant, representation, warranty or other
agreement in this Indenture or the Notes for 60 days after notice to the Company
by the Trustee or the Holders of at least 25% in aggregate principal amount at
maturity of the Notes then outstanding voting as a single class;
(e) a default occurs under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or evidenced
any Indebtedness for money borrowed by the Company or any of its Significant
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
Significant Subsidiaries), whether such Indebtedness or guarantee now exists, or
is created after the date of this Indenture, which default (i) is caused by a
failure to pay principal of or premium, if any, or interest on such Indebtedness
prior to the expiration of the grace period provided in such Indebtedness on the
date of such default (a "Payment Default"), and (ii) results in the acceleration
of such Indebtedness prior to its express maturity and, in each case, the
principal amount of any such Indebtedness, together with the principal amount of
any other such Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $20.0 million or more;
(f) a final judgment or final judgments for the payment of money are
entered by a court or courts of competent jurisdiction against the Company or
any of its Significant Subsidiaries and such judgment or judgments remain
undischarged for a period (during which execution shall not be effectively
stayed) of 60 days, provided that the aggregate of all such undischarged
judgments exceeds $5.0 million;
(g) the Company or any of its Restricted Subsidiaries that is a
Significant Subsidiary or any group of Restricted Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary pursuant to or within the
meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it
in an involuntary case,
(iii) consents to the appointment of a custodian of it or for
all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) generally is not paying its debts as they become due; or
(h) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
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(i) is for relief against the Company or any of its Restricted
Subsidiaries that is a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary in an involuntary case;
(ii) appoints a custodian of the Company or any of its
Restricted Subsidiaries that is a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary or for all or substantially all of the property of
the Company or any of its Restricted Subsidiaries that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken as a whole,
would constitute a Significant Subsidiary; or
(iii) orders the liquidation of the Company or any of its
Restricted Subsidiaries;
and the order or decree remains unstayed and in effect for 60 consecutive days.
Section 6.02. Acceleration.
If any Event of Default (other than an Event of Default specified in
clause (g) or (h) of Section 6.01 hereof with respect to the Company, any
Restricted Subsidiary that is a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken together, would constitute a Significant
Subsidiary) occurs and is continuing, the Trustee or the Holders of at least 25%
in principal amount at maturity of the then outstanding Notes may declare all
the Notes to be due and payable immediately. Upon any such declaration, the
aggregate principal amount plus accrued and unpaid interest thereon, if any (or
if such declaration occurs prior to March 15, 2006, the Accreted Value), of the
Notes shall become due and payable immediately. Notwithstanding the foregoing,
if an Event of Default specified in clause (g) or (h) of Section 6.01 hereof
occurs with respect to the Company, any of its Restricted Subsidiaries that is a
Significant Subsidiary or any group of Restricted Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary, the aggregate principal amount
plus accrued and unpaid interest if any (or if such declaration occurs prior to
March 15, 2006, the Accreted Value) of all outstanding Notes shall be due and
payable immediately without further action or notice. The Holders of a majority
in aggregate principal amount at maturity of the then outstanding Notes by
written notice to the Trustee may on behalf of all of the Holders rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal, interest or premium that has become due solely because of the
acceleration) have been cured or waived.
If an Event of Default occurs on or after March 15, 2006 by reason
of any willful action (or inaction) taken (or not taken) by or on behalf of the
Company with the intention of avoiding payment of the premium that the Company
would have had to pay if the Company then had elected to redeem the Notes
pursuant to Section 3.07 hereof, then, upon acceleration of the Notes, an
equivalent premium shall also become and be immediately due and payable, to the
extent permitted by law, anything in this Indenture or in the Notes to the
contrary notwithstanding. If an Event of Default occurs prior to March 15, 2006
by reason of any willful action (or inaction) taken (or not taken) by or on
behalf of the Company with the intention of
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avoiding the prohibition on redemption of the Notes prior to such date, then,
upon acceleration of the Notes, an additional premium shall also become and be
immediately due and payable in an amount, for each of the years beginning on
March 15 of the years set forth below, as set forth below (expressed as a
percentage of the Accreted Value of the Notes on the date of payment that would
otherwise be due but for the provisions of this sentence):
YEAR PERCENTAGE
---- ----------
2001.................................................. 116.667%
2002.................................................. 114.583%
2003.................................................. 112.500%
2004.................................................. 110.416%
2005.................................................. 108.333%
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal or Accreted
Value, premium and Liquidated Damages, if any, and interest on the Notes or to
enforce the performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04. Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount at
maturity of the then outstanding Notes by notice to the Trustee may on behalf of
the Holders of all of the Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of the principal (or, if prior to March 15, 2006, the Accreted
Value) of, premium and Liquidated Damages, if any, or interest on, the Notes
(including in connection with an offer to purchase) (provided, however, that the
Holders of a majority in aggregate principal amount at maturity of the then
outstanding Notes may rescind an acceleration and its consequences, including
any related payment default that resulted from such acceleration). Upon any such
waiver, such Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
Section 6.05. Control by Majority.
Holders of a majority in principal amount at maturity of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the
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Trustee may refuse to follow any direction that conflicts with law or this
Indenture that the Trustee determines may be unduly prejudicial to the rights of
other Holders of Notes or that may involve the Trustee in personal liability.
Section 6.06. Limitation on Suits.
A Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount at maturity of
the then outstanding Notes make a written request to the Trustee to pursue the
remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount at maturity of the then outstanding Notes do not give the Trustee a
direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the
rights of another Holder of a Note or to obtain a preference or priority over
another Holder of a Note.
Section 6.07. Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture but subject to
Section 3.10, the right of any Holder of a Note to receive payment of principal
(or, if prior to March 15, 2006, the Accreted Value), premium and Liquidated
Damages, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a) or (b) occurs
and is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Company for the whole amount of
principal (or, if prior to March 15, 2006, the Accreted Value) of, premium and
Liquidated Damages, if any, and interest remaining unpaid on the Notes (if after
March 15, 2006) and interest on overdue principal (or Accreted Value if prior to
March 15, 2006) and, to the extent lawful, interest and such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
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Section 6.09. Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07 hereof, including payment of all compensation,
expenses and liabilities incurred, and all advances made, by the Trustee
and the costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the
Notes for principal (or, if prior to March 15, 2006, the Accreted Value),
premium and Liquidated Damages, if any, and interest, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Notes for principal (or, if prior to March 15, 2006, the
Accreted Value), premium and Liquidated Damages, if any, and interest,
respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment
to Holders of Notes pursuant to this Section 6.10.
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Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder of a
Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount at maturity of the then outstanding Notes.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by
the express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b)
of this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05 hereof.
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(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or incur any liability. The Trustee shall be under
no obligation to exercise any of its rights and powers under this Indenture at
the request of any Holders, unless such Holders shall have offered to the
Trustee security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
Section 7.02. Rights of Trustee.
(a) The Trustee may conclusively rely upon any document believed by
it to be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel at the Company's expense or
both. The Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on such Officers' Certificate or Opinion of Counsel.
The Trustee may consult with counsel and the written advice of such counsel or
any Opinion of Counsel shall be full and complete authorization and protection
from liability in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
security or indemnity satisfactory to it against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company
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with the same rights it would have if it were not Trustee. However, in the event
that the Trustee acquires any conflicting interest it must eliminate such
conflict within 90 days, apply to the SEC for permission to continue as trustee
or resign. Any Agent may do the same with like rights and duties. The Trustee is
also subject to Sections 7.10 and 7.11 hereof.
Section 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to Holders of Notes a notice of
the Default or Event of Default within 90 days after it occurs. Except in the
case of a Default or Event of Default in payment of principal (or, if prior to
March 15, 2006, the Accreted Value) of, premium or Liquidated Damages, if any,
or interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of the Holders of the Notes.
Section 7.06. Reports by Trustee to Holders of the Notes.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA Section 313(a) (but if no event described
in TIA Section 313(a) has occurred within the twelve months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with TIA Section 313(b)(2). The Trustee shall also transmit by mail all reports
as required by TIA Section 313(c).
A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Notes are listed in accordance with TIA Section 313(d).
The Company shall promptly notify the Trustee when the Notes are listed on any
stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses
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shall include the reasonable compensation, disbursements and expenses of the
Trustee's agents and counsel.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, including the
costs and expenses of enforcing this Indenture against the Company (including
this Section 7.07) and defending itself against any claim (whether asserted by
the Company or any Holder or any other person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense may be attributable to its
negligence or bad faith. The Trustee shall notify the Company promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Company shall not relieve the Company of its obligations hereunder. The Company
shall defend the claim and the Trustee shall cooperate in the defense. The
Trustee may have separate counsel and the Company shall pay the reasonable fees
and expenses of such counsel. The Company need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld.
The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal (or, if
prior to March 15, 2006, the Accreted Value) and interest on particular Notes.
Such Lien shall survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(g) or (h) hereof occurs, the expenses and
the compensation for the services (including the fees and expenses of its agents
and counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA Section
313(b)(2) to the extent applicable.
Section 7.08. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of a majority
in principal amount at maturity of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company may
remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
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(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount at maturity of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of at least 10% in principal amount at maturity of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
Section 7.10. Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus
(together with its parent) of at least $100.0 million as set forth in its most
recent published annual report of condition.
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This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant
Defeasance.
The Company may, at the option of its Board of Directors evidenced
by a resolution set forth in an Officers' Certificate, at any time, elect to
have either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article Eight.
Section 8.02. Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Notes to receive solely from the trust fund described in Section
8.04 hereof, and as more fully set forth in such Section, payments in respect of
the principal (or, if prior to March 15, 2006, the Accreted Value) of, premium
and Liquidated Damages, if any, and interest on such Notes when such payments
are due, (b) the Company's obligations with respect to such Notes concerning
issuing temporary Notes, registration of Notes, mutilated, destroyed, lost or
stolen Notes and the maintenance of an office or agency for payment and money
for security payments held in trust, (c) the rights, powers, trusts, duties and
immunities of the Trustee hereunder and the Company's obligations in connection
therewith and (d) this Article Eight. Subject to compliance with this Section
8.02, the Company may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03 hereof.
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Section 8.03. Covenant Defeasance.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be released from their
obligations under the covenants contained in Sections 4.03, 4.07, 4.08, 4.09,
4.10, 4.11, 4.12, 4.13, 4.14 and 4.15 hereof and clauses (3) and (4) of Section
5.01 hereof with respect to the outstanding Notes on and after the date the
conditions set forth in Section 8.04 are satisfied (hereinafter, "Covenant
Defeasance"), and the Notes shall thereafter be deemed not "outstanding" for the
purposes of any direction, waiver, consent or declaration or act of Holders (and
the consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Company may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document and such omission to
comply shall not constitute a Default or an Event of Default under Section 6.01
hereof, but, except as specified above, the remainder of this Indenture and such
Notes shall be unaffected thereby. In addition, upon the Company's exercise
under Section 8.01 hereof of the option applicable to this Section 8.03 hereof,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
Sections 6.01(c) through 6.01(f) hereof shall not constitute Events of Default.
Section 8.04. Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, cash in United States dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal (or, if prior to March 15, 2006, the Accreted
Value) of, premium and Liquidated Damages, if any, and interest on the
outstanding Notes on the stated date for payment thereof or on the applicable
redemption date, as the case may be, and the Company must specify whether the
Notes are being defeased to maturity or to a particular redemption date;
(b) in the case of an election under Section 8.02 hereof except
where the Notes have been called for redemption, the Company shall have
delivered to the Trustee an Opinion of Counsel in the United States reasonably
acceptable to the Trustee confirming that (A) the Company has received from, or
there has been published by, the Internal Revenue Service a ruling or (B) since
the date of this Indenture, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based thereon such
Opinion of Counsel shall confirm that, the Holders of the outstanding Notes will
not recognize income, gain or loss for
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federal income tax purposes as a result of such Legal Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Legal Defeasance had not
occurred;
(c) in the case of an election under Section 8.03 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Covenant Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be
continuing either: (a) on the date of such deposit (other than a Default or
Event of Default resulting from the incurrence of Indebtedness all or a portion
of the proceeds of which will be used to defease the Notes pursuant to this
Article Eight concurrently with such incurrence); or (b) insofar as Sections
6.01(g) or 6.01(h) hereof is concerned, at any time in the period ending on the
91st day after the date of deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not result in
a breach or violation of, or constitute a default under, any material agreement
or instrument (other than this Indenture) to which the Company or any of its
Restricted Subsidiaries is a party or by which the Company or any of its
Restricted Subsidiaries is bound, including without limitation the Credit
Facilities;
(f) except where the Notes have been called for redemption, the
Company shall have delivered to the Trustee an Opinion of Counsel to the effect
that on the 91st day following the deposit, the trust funds will not be subject
to the effect of any applicable bankruptcy, insolvency, reorganization or
similar laws affecting creditors' rights generally;
(g) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders of Notes over any other creditors of the Company or
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company; and
(h) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
Section 8.05. Deposited Money and Government Securities to be Held
in Trust; Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through
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any Paying Agent (including the Company acting as Paying Agent) as the Trustee
may determine, to the Holders of such Notes of all sums due and to become due
thereon in respect of principal (or, if prior to March 15, 2006, the Accreted
Value), premium and Liquidated Damages, if any, and interest, but such money
need not be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 hereof or the principal
and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article Eight to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.04(a) hereof), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
Section 8.06. Repayment to Company.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal (or, if prior to
March 15, 2006, the Accreted Value) of, premium and Liquidated Damages, if any,
or interest on any Note and remaining unclaimed for two years after such
principal, and premium and Liquidated Damages, if any, or interest has become
due and payable shall be paid to the Company on its request (unless an abandoned
property law designates another person) or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Note shall thereafter look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in the New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
Section 8.07. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
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permitted to apply all such money in accordance with Section 8.02 or 8.03
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal (or, if prior to March 15, 2006, the Accreted Value) of,
premium or Liquidated Damages, if any, or interest on any Note following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the money held by the
Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, the Company and the
Trustee may amend or supplement this Indenture or the Notes without the consent
of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place
of certificated Notes or to alter the provisions of Article Two hereof
(including the related definitions) in a manner that does not materially
adversely affect any Holder;
(c) to provide for the assumption of the Company's obligations to
the Holders of the Notes by a successor to the Company pursuant to Article Five
hereof;
(d) to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights hereunder of any Holder of the Notes; or
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Company in the execution of any
amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02. With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture (including Section 3.09, 4.10 and
4.14 hereof), the Notes with the consent of the Holders of at least a majority
in principal amount at maturity of the Notes then outstanding voting as a single
class (including consents obtained in connection with a tender offer or exchange
offer for, or purchase of, the Notes), and, subject to Sections 6.04 and 6.07
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hereof, any existing Default or Event of Default (other than a Default or Event
of Default in the payment of the principal (or, if prior to March 15, 2006, the
Accreted Value) of, premium, if any, or interest or Liquidated Damages, if any,
on the Notes, except a payment default resulting from an acceleration that has
been rescinded) or compliance with any provision of this Indenture or the Notes
may be waived with the consent of the Holders of a majority in principal amount
at maturity of the then outstanding Notes voting as a single class (including
consents obtained in connection with a tender offer or exchange offer for, or
purchase of, the Notes). Section 2.08 hereof shall determine which Notes are
considered to be "outstanding" for purposes of this Section 9.02.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee shall
join with the Company in the execution of such amended or supplemental Indenture
unless such amended or supplemental Indenture directly affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but shall not be obligated to, enter into
such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes
under this Section 9.02 to approve the particular form of any proposed amendment
or waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount at maturity of the Notes then outstanding
voting as a single class may waive compliance in a particular instance by the
Company with any provision of this Indenture or the Notes. However, without the
consent of each Holder affected, an amendment or waiver under this Section 9.02
may not (with respect to any Notes held by a non-consenting Holder):
(a) reduce the principal amount at maturity of Notes whose Holders
must consent to an amendment, supplement or waiver;
(b) reduce the principal amount at maturity of or change the fixed
maturity of any Note or alter or waive any of the provisions with respect to the
redemption of the Notes except as provided above with respect to Sections 4.10
and 4.14 hereof or amend or modify the calculation of Accreted Value so as to
reduce the amount of the Accreted Value of the Notes;
(c) reduce the rate of or change the time for payment of interest,
including default interest, on any Note;
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(d) waive a Default or Event of Default in the payment of principal
(or, if prior to March 15, 2006, the Accreted Value) of or premium or Liquidated
Damages, if any, or interest on the Notes (except a rescission of acceleration
of the Notes by the Holders of at least a majority in aggregate principal amount
at maturity of the then outstanding Notes and a waiver of the payment default
that resulted from such acceleration);
(e) make any Note payable in money other than that stated in the
Notes;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of principal (or, if prior to March 15, 2006, the Accreted Value) of, or
premium, if any, or interest or Liquidated Damages, if any, on the Notes;
(g) waive a redemption payment with respect to any Note (other than
a payment required by Sections 4.10 or 4.14 hereof); or
(h) make any change in the foregoing amendment and waiver
provisions.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall
be set forth in an amended or supplemental Indenture that complies with the TIA
as then in effect.
Section 9.04. Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
is not made on any Note. However, any such Holder of a Note or subsequent Holder
of a Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05. Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment, supplement or waiver.
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Section 9.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article Nine if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Company may not sign an amendment or supplemental Indenture until the Board
of Directors approves it. In executing any amended or supplemental indenture,
the Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
shall be fully protected in relying upon, in addition to the documents required
by Section 10.04 hereof, an Officers' Certificate and an Opinion of Counsel
stating that the execution of such amended or supplemental indenture is
authorized or permitted by this Indenture.
ARTICLE 10
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA Section 318(c), the imposed duties shall control.
Section 10.02. Notices.
Any notice or communication by the Company or the Trustee to the
others is duly given if in writing and delivered in Person or mailed by first
class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
If to the Company:
Emmis Communications Corporation
One Emmis Plaza
40 Monument Circle
Suite 700
Indianapolis, IN 46204
Telecopier No.: (317) 631-3750
Attention: Chief Financial Officer
With a copy to:
Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, NY 10019-6064
Telecopier No.: (212) 492-0025
Attention: John Kennedy
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If to the Trustee:
The Bank of Nova Scotia Trust Company of New York
One Liberty Plaza, 23rd Floor
New York, NY 10006
Telecopier No.: (212) 225-5436
Attention: Corporate Trust Administration
The Company or the Trustee, by notice to the others, may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next day delivery to its address shown on the register
kept by the Registrar. Any notice or communication shall also be so mailed to
any Person described in TIA Section 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it shall
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
Section 10.03. Communication by Holders of Notes with Other Holders
of Notes.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c).
Section 10.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to
take any action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
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(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
Section 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of
TIA Section 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
Section 10.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting
of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 10.07. No Personal Liability of Directors, Officers,
Employees and Stockholders.
No past, present or future director, officer, employee, incorporator
or stockholder of the Company as such, shall have any liability for any
obligations of the Company under the Notes or this Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.
Section 10.08. Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED
TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
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Section 10.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture,
loan or debt agreement of the Company or its Subsidiaries or of any other
Person. Any such indenture, loan or debt agreement may not be used to interpret
this Indenture.
Section 10.10. Successors.
All agreements of the Company in this Indenture and the Notes shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors.
Section 10.11. Severability.
In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 10.12. Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
Section 10.13. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
Signatures on following page
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SIGNATURES
Dated as of March 27, 2001
EMMIS ESCROW CORPORATION
BY:
--------------------------------------
Name: J. Scott Enright
Title: Vice President and Associate General
Counsel
THE BANK OF NOVA SCOTIA TRUST COMPANY OF
NEW YORK
BY:
--------------------------------------
Name:
Title:
98
EXHIBIT A1
[Face of Note]
CUSIP/CINS ____________
12-1/2% Senior Discount Notes due 2011
No. ___ $____________
EMMIS ESCROW CORPORATION
promises to pay to Cede & Co. or registered assigns, the principal sum of ______
Dollars on ____________, 2011.
Interest Payment Dates: March 15 and September 15 commencing September 15, 2006
Record Dates: March 1 and September 1
Dated: _________, 2001
EMMIS ESCROW CORPORATION
BY:
-----------------------------------------
NAME:
TITLE:
This is one of the Notes referred to
in the within-mentioned Indenture:
THE BANK OF NOVA SCOTIA TRUST COMPANY OF NEW YORK,
as Trustee
By:
-----------------------------------------
Authorized Signatory
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EXHIBIT A1
[Back of Note]
12-1/2% Senior Discount Notes due 2011
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
[Insert the ERISA Legend, if applicable, pursuant to the provisions of the
Indenture]
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Emmis Escrow Corporation, an Indiana corporation (the
"Company"), promises to pay interest on the principal amount of this Note at
12-1/2% per annum from March 15, 2006 until maturity and shall pay the
Liquidated Damages payable pursuant to Section 5 of the Registration Rights
Agreement referred to below. No interest will accrue on the Notes prior to March
15, 2006. Instead the Accreted Value of each Note will increase (representing
amortization of original issue discount) between the date of original issuance
and March 15, 2006, at a rate of 12-1/2% calculated on a semi-annual bond
equivalent basis using a 360-day year comprised of twelve 30-day months, such
that the Accreted Value on March 15, 2006 will be equal to the full principal
amount at maturity of the Notes. Beginning on March 15, 2006, interest on the
Notes will accrue at a rate of 12-1/2% per annum. The Company will pay interest
and Liquidated Damages semi-annually in arrears on March 15 and September 15 of
each year, or if any such day is not a Business Day, on the next succeeding
Business Day (each an "Interest Payment Date"). Interest on the Notes will
accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from March 15, 2006; provided that if there is no
existing Default in the payment of interest, and if this Note is authenticated
between a record date referred to on the face hereof and the next succeeding
Interest Payment Date, interest shall accrue from such next succeeding Interest
Payment Date; provided, further, that the first Interest Payment Date shall be
September 15, 2006. The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal (or,
if prior to March 15, 2006, the Accreted Value) and premium, if any, from time
to time on demand at a rate that is 1% per annum in excess of the rate then in
effect; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace periods) from time to
time on demand at the same rate to the extent lawful. Interest will be computed
on the basis of a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages to the Persons who are
registered Holders of Notes at the close of business on the March 1 or September
1 preceding the Interest Payment Date, even if such Notes are canceled after
such record date and on or before such Interest Payment Date, except as provided
in Section 2.12 of the Indenture with respect to defaulted interest. The Notes
will be payable as to principal (or, if prior to March 15, 2006, the Accreted
Value), premium and Liquidated Damages, if any, and interest at the office or
agency of the Company maintained for such purpose within or without the City and
State of New York, or, at the option of the
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EXHIBIT A1
Company, payment of interest and Liquidated Damages may be made by check mailed
to the Holders at their addresses set forth in the register of Holders, and
provided that payment by wire transfer of immediately available funds will be
required with respect to principal (or, if prior to March 15, 2006, the Accreted
Value) of and interest, premium and Liquidated Damages on, all Global Notes and
all other Notes the Holders of which shall have provided wire transfer
instructions to the Company or the Paying Agent. Such payment shall be in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, The Bank of Nova Scotia Trust
Company of New York, the Trustee under the Indenture, will act as Paying Agent
and Registrar. The Company may change any Paying Agent or Registrar without
notice to any Holder. The Company or any of its Subsidiaries may act in any such
capacity.
4. INDENTURE. The Company issued the Notes under an Indenture dated as
of March 27, 2001 ("Indenture") between the Company and the Trustee. The terms
of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S.
Code Sections 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling. The Notes are obligations of the Company limited to $370,000,000 in
aggregate principal amount at maturity.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraphs (b) and (c) of this Paragraph
5, the Company shall not have the option to redeem the Notes prior to March 15,
2006. Thereafter, the Company shall have the option to redeem the Notes, in
whole or in part, upon not less than 30 nor more than 60 days' notice, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest and Liquidated Damages thereon, if any, to the
applicable redemption date, if redeemed during the twelve-month period beginning
on March 15 of the years indicated below:
Year Percentage
2006................................................. 106.250%
2007................................................. 104.167%
2008................................................. 102.083%
2009 and thereafter.................................. 100.000%
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, at any time prior to March 15, 2004, the Company may on one or more
occasions redeem Notes with the net cash proceeds of one or more Equity
Offerings at a redemption price equal to 112.5% of the Accreted Value thereof
plus Liquidated Damages thereon, if any; provided that at least 65% in aggregate
principal amount at maturity of the Notes originally issued under the Indenture
remain outstanding immediately after the occurrence of such redemption
(excluding
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EXHIBIT A1
Notes held by the Company and its Subsidiaries) and that such redemption occurs
within 90 days after the date of the closing of such Equity Offering.
(c) At any time prior to March 15, 2006, the Company may also redeem
all or a part of the Notes upon not less than 30 nor more than 60 days notice
mailed by first class mail to each Holder's registered address, at a redemption
price equal to 100% of the Accreted Value thereof plus the Applicable Premium as
of, and Liquidated Damages, if any, to the date of redemption.
(d) Any redemption pursuant to this subparagraph 5 shall be made
pursuant to the provisions of Section 3.01 through 3.06 of the Indenture.
6. MANDATORY REDEMPTION AND EXCHANGE.
(a) Except as set forth in paragraph 7 below, the Company shall not be
required to make mandatory redemption or sinking fund payments with respect to
the Notes.
(b) In the event that the Reorganization has not been completed by July
25, 2001, all and not less than all of the Notes then outstanding shall be
mandatorily exchanged into shares of Exchangeable Preferred Stock.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be required to
make an offer (a "Change of Control Offer") to repurchase all or any part (equal
to $1,000 or an integral multiple thereof) of each Holder's Notes at a purchase
price equal to 101% of the aggregate principal amount at maturity thereof plus
accrued and unpaid interest and Liquidated Damages thereon, if any, to the date
of purchase (or if such a Change of Control Offer is prior to March 15, 2006 at
101% of the Accreted Value thereof plus Liquidated Damages thereon, if any, to
the date of purchase) (the "Change of Control Payment") . Within 30 days
following any Change of Control, the Company shall mail a notice to each Holder
setting forth the procedures governing the Change of Control Offer as required
by the Indenture.
(b) If the Company or a Subsidiary consummates any Asset Sales, within
five days of each date on which the aggregate amount of Excess Proceeds exceeds
$5.0 million, the Company shall commence an offer to all Holders of Notes (an
"Asset Sale Offer") pursuant to Section 3.09 of the Indenture to purchase the
maximum principal amount at maturity of Notes and pari passu Indebtedness that
may be purchased out of the Excess Proceeds at an offer price in cash in an
amount equal to 100% of the principal amount at maturity thereof plus accrued
and unpaid interest and Liquidated Damages thereon, if any, to the date fixed
for the closing of such offer (or, in the case of purchases of Notes prior to
March 15, 2006, at 100% of the Accreted Value thereof, plus Liquidated Damages
thereon, if any, to the date of purchase) in accordance with the procedures set
forth in the Indenture. To the extent that the aggregate amount at maturity or
Accreted Value (as applicable) of the Notes tendered pursuant to an Asset Sale
Offer is less than the Excess Proceeds, the Company (or such Subsidiary) may use
such deficiency for any purpose not otherwise prohibited by the Indenture. If
the aggregate principal amount at
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EXHIBIT A1
maturity or Accreted Value (as applicable) of Notes and other such pari passu
indebtedness surrendered by Holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes to be purchased on a pro rata
basis. Notwithstanding the foregoing, the Company shall not be required to
repurchase any Notes pursuant to this paragraph 7(b) unless such repurchase
complies with the restricted payments covenants contained in the other
Indebtedness of the Company and its Subsidiaries. Holders of Notes that are the
subject of an offer to purchase will receive an Asset Sale Offer from the
Company prior to any related purchase date and may elect to have such Notes
purchased by completing the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Notes.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at least
30 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address. Notes in denominations
larger than $1,000 of principal amount at maturity may be redeemed in part but
only in whole multiples of $1,000 of principal amount at maturity, unless all of
the Notes held by a Holder are to be redeemed. On and after the Redemption Date,
the Notes or portions thereof called for redemption cease to accrete and
interest ceases to accrue thereon.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 of principal amount at maturity and
integral multiples of $1,000 of principal amount at maturity. The transfer of
Notes may be registered and Notes may be exchanged as provided in the Indenture.
The Registrar and the Trustee may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and the Company may
require a Holder to pay any taxes and fees required by law or permitted by the
Indenture. The Company need not exchange or register the transfer of any Note or
portion of a Note selected for redemption, except for the unredeemed portion of
any Note being redeemed in part. Also, the Company need not exchange or register
the transfer of any Notes for a period of 15 days before a selection of Notes to
be redeemed or during the period between a record date and the corresponding
Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount at maturity of the then
outstanding Notes voting as a single class, and any existing default or
compliance with any provision of the Indenture or the Notes may be waived with
the consent of the Holders of a majority in principal amount at maturity of the
then outstanding Notes voting as a single class. Without the consent of any
Holder of a Note, the Indenture or the Notes may be amended or supplemented to
cure any ambiguity, defect or inconsistency, to provide for uncertificated Notes
in addition to or in place of certificated Notes, to provide for the assumption
of the Company's to Holders of the Notes in case of a merger or consolidation,
to make any change that would provide any additional rights or benefits to the
Holders of the Notes or that does not adversely affect the legal rights under
the Indenture of any such Holder and to comply with the requirements of the SEC
in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act.
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EXHIBIT A1
12. DEFAULTS AND REMEDIES. Events of Default include: (i) default for
30 days in the payment when due of interest or Liquidated Damages on the Notes;
(ii) default in payment when due of principal (or, if prior to March 15, 2006,
the Accreted Value) of or premium, if any, on the Notes when the same becomes
due and payable at maturity, upon redemption (including in connection with an
offer to purchase) or otherwise; (iii) failure by the Company or any of its
Subsidiaries for, 30 days after notice to the Company by the Trustee or the
Holders of at least 25% in aggregate principal amount at maturity of the Notes
then outstanding voting as a single class, to comply with Sections 5.01 or 5.02
of the Indenture or to consummate a Change of Control Offer or Asset Sale Offer
in accordance with Sections 4.10 and 4.14 of the Indenture; (iv) failure by the
Company for 60 days after notice to the Company by the Trustee or the Holders of
at least 25% in principal amount at maturity of the Notes then outstanding
voting as a single class to comply with certain other agreements in the
Indenture, the Notes; (v) default under certain other agreements relating to
Indebtedness of the Company which default results in the acceleration of such
Indebtedness prior to its express maturity; (vi) certain final judgments for the
payment of money that remain undischarged for a period of 60 days; and (vii)
certain events of bankruptcy or insolvency with respect to the Company or any of
its Significant Subsidiaries. If any Event of Default occurs and is continuing,
the Trustee or the Holders of at least 25% in principal amount at maturity of
the then outstanding Notes may declare all the Notes to be due and payable.
Notwithstanding the foregoing, in the case of an Event of Default arising from
certain events of bankruptcy or insolvency, all outstanding Notes will become
due and payable without further action or notice. Holders may not enforce the
Indenture or the Notes except as provided in the Indenture. Subject to certain
limitations, Holders of a majority in principal amount at maturity of the then
outstanding Notes may direct the Trustee in its exercise of any trust or power.
The Trustee may withhold from Holders of the Notes notice of any continuing
Default or Event of Default (except a Default or Event of Default relating to
the payment of principal (or, if prior to March 15, 2006, the Accreted Value),
premium or Liquidated Damages, if any, or interest) if it determines that
withholding notice is in their interest. The Holders of a majority in aggregate
principal amount at maturity of the Notes then outstanding by notice to the
Trustee may on behalf of the Holders of all of the Notes waive any existing
Default or Event of Default and its consequences under the Indenture except a
continuing Default or Event of Default in the payment of interest on, or the
principal (or, if prior to March 15, 2006, the Accreted Value) of, the Notes.
The Company is required to deliver to the Trustee annually a statement regarding
compliance with the Indenture, and the Company is required upon becoming aware
of any Default or Event of Default, to deliver to the Trustee a statement
specifying such Default or Event of Default.
13. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes or the Indenture or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes.
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15. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
16. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the Registration Rights
Agreement.
18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Emmis Escrow Corporation
One Emmis Plaza
40 Monument Circle, Suite 700
Indianapolis, IN 46204
Attention: Chief Financial Officer
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ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:
----------------------------------
(Insert assignee's legal name)
- --------------------------------------------------------------------------------
(Insert assignee's Soc. Sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
--------------------------------------------------------
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date:
-------------------
Your Signature:
--------------------------------
(Sign exactly as your name
appears on the face of this Note)
Signature Guarantee*:
--------------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
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EXHIBIT A1
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.14 of the Indenture, check the appropriate box
below:
[ ] Section 4.10 [ ] Section 4.14
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased:
$
-------------
Date:
--------------------
Your Signature:
-------------------------------------
(Sign exactly as your name
appears on the face of this Note)
Tax Identification No.:
-----------------------------
Signature Guarantee*:
------------------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
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EXHIBIT A1
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note, have
been made:
Principal Amount Signature of
Amount of decrease in Amount of increase in of this Global Note authorized officer of
Principal Amount Principal Amount following such decrease Trustee or Note
Date of Exchange of this Global Note of this Global Note (or increase) Custodian
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EXHIBIT A2
* This schedule should be included only if the Note is issued in global form.
[Face of Regulation S Temporary Global Note]
CUSIP/CINS __________
12-1/2% Senior Discount Notes due 2011
No. __ $______________
EMMIS ESCROW CORPORATION
promises to pay to Cede & Co. or registered assigns, the principal sum of ______
_________________________________ Dollars on____________, 2011.
Interest Payment Dates: March 15 and September 15 commencing September 15, 2006
Record Dates: March 1 and September 1
Dated: _________, 2001
EMMIS ESCROW CORPORATION
BY:
___________________________________________
NAME:
TITLE:
This is one of the Notes referred to
in the within-mentioned Indenture:
THE BANK OF NOVA SCOTIA TRUST COMPANY OF NEW YORK,
as Trustee
By: __________________________________
Authorized Signatory
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EXHIBIT A2
Back of Regulation S Temporary Global Note
12-1/2% Senior Discount Notes due 2011
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE NOTE
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE NOTE EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
RELYING ON THE EXEMPTION PROVIDED BY RULE 144A UNDER THE SECURITIES ACT. THE
HOLDER OF THE NOTE EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) SUCH NOTE MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) (a) TO A
PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS
DEFINED IN OF RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A FOREIGN PERSON
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT
OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT (AND BASED UPON AN
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OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR (3)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE
WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT
HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE NOTE EVIDENCED HEREBY OF THE
RESALE RESTRICTIONS SET FORTH IN (1) ABOVE.
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Emmis Escrow Corporation, an Indiana corporation (the
"Company"), promises to pay interest on the principal amount of this Note at
12-1/2% per annum from March 15, 2006 until maturity and shall pay the
Liquidated Damages payable pursuant to Section 5 of the Registration Rights
Agreement referred to below. No interest will accrue on the Notes prior to March
15, 2006. Instead the Accreted Value of each Note will increase (representing
amortization of original issue discount) between the date of original issuance
and March 15, 2006, at a rate of 12-1/2% calculated on a semi-annual bond
equivalent basis using a 360-day year comprised of twelve 30-day months, such
that the Accreted Value on March 15, 2006 will be equal to the full principal
amount at maturity of the Notes. Beginning on March 15, 2006, interest on the
Notes will accrue at a rate of 12-1/2% per annum. The Company will pay interest
and Liquidated Damages semi-annually in arrears on March 15 and September 15 of
each year, or if any such day is not a Business Day, on the next succeeding
Business Day (each an "Interest Payment Date"). Interest on the Notes will
accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from March 15, 2006; provided that if there is no
existing Default in the payment of interest, and if this Note is authenticated
between a record date referred to on the face hereof and the next succeeding
Interest Payment Date, interest shall accrue from such next succeeding Interest
Payment Date; provided, further, that the first Interest Payment Date shall be
September 15, 2006. The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal (or,
if prior to March 15, 2006, the Accreted Value) and premium, if any, from time
to time on demand at a rate that is 1% per annum in excess of the rate then in
effect; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace periods) from time to
time on demand at the same rate to the extent lawful. Interest will be computed
on the basis of a 360-day year of twelve 30-day months.
Until this Regulation S Temporary Global Note is exchanged for one or
more Regulation S Permanent Global Notes, the Holder hereof shall not be
entitled to receive payments of interest hereon; until so exchanged in full,
this Regulation S Temporary Global Note shall in all other respects be entitled
to the same benefits as other Senior Discount Notes under the Indenture.
2. METHOD OF PAYMENT. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages to the Persons who are
registered Holders of Notes at the close of business on the March 1 or September
1 preceding the Interest Payment Date, even if
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EXHIBIT A2
such Notes are canceled after such record date and on or before such Interest
Payment Date, except as provided in Section 2.12 of the Indenture with respect
to defaulted interest. The Notes will be payable as to principal (or, if prior
to March 15, 2006, the Accreted Value), premium and Liquidated Damages, if any,
and interest at the office or agency of the Company maintained for such purpose
within or without the City and State of New York, or, at the option of the
Company, payment of interest and Liquidated Damages may be made by check mailed
to the Holders at their addresses set forth in the register of Holders, and
provided that payment by wire transfer of immediately available funds will be
required with respect to principal (or, if prior to March 15, 2006, the Accreted
Value) of and interest, premium and Liquidated Damages on, all Global Notes and
all other Notes the Holders of which shall have provided wire transfer
instructions to the Company or the Paying Agent. Such payment shall be in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. PAYING AGENT AND REGISTRAR. Initially,
The Bank of Nova Scotia Trust Company of New York, the Trustee under the
Indenture, will act as Paying Agent and Registrar. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company or any of
its Subsidiaries may act in any such capacity.
4. INDENTURE. The Company issued the Notes under an Indenture dated as
of March 27, 2001 ("Indenture") between the Company and the Trustee. The terms
of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S.
Code Sections 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling. The Notes are obligations of the Company limited to $370,000,000 in
aggregate principal amount at maturity.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraphs (b) and (c) of this Paragraph
5, the Company shall not have the option to redeem the Notes prior to March 15,
2006. Thereafter, the Company shall have the option to redeem the Notes, in
whole or in part, upon not less than 30 nor more than 60 days' notice, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest and Liquidated Damages thereon, if any, to the
applicable redemption date, if redeemed during the twelve-month period beginning
on March 15 of the years indicated below:
Year Percentage
2006..................................................... 106.250%
2007..................................................... 104.167%
2008..................................................... 102.083%
2009 and thereafter...................................... 100.000%
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EXHIBIT A2
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, at any time prior to March 15, 2004, the Company may on one or more
occasions redeem Notes with the net cash proceeds of one or more Equity
Offerings at a redemption price equal to 112.5% of the Accreted Value thereof
plus Liquidated Damages thereon, if any; provided that at least 65% in aggregate
principal amount at maturity of the Notes originally issued under the Indenture
remain outstanding immediately after the occurrence of such redemption
(excluding Notes held by the Company and its Subsidiaries) and that such
redemption occurs within 90 days after the date of the closing of such Equity
Offering.
(c) At any time prior to March 15, 2006, the Company may also redeem
all or a part of the Notes upon not less than 30 nor more than 60 days notice
mailed by first class mail to each Holder's registered address, at a redemption
price equal to 100% of the Accreted Value thereof plus the Applicable Premium as
of, and Liquidated Damages, if any, to the date of redemption.
(d) Any redemption pursuant to this subparagraph 5 shall be made
pursuant to the provisions of Section 3.01 through 3.06 of the Indenture.
6. MANDATORY REDEMPTION AND EXCHANGE.
(a) Except as set forth in paragraph 7 below, the Company shall not be
required to make mandatory redemption or sinking fund payments with respect to
the Notes.
(b) In the event that the Reorganization has not been completed by July
25, 2001, all and not less than all of the Notes then outstanding shall be
mandatorily exchanged into shares of Exchangeable Preferred Stock.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be required to
make an offer (a "Change of Control Offer") to repurchase all or any part (equal
to $1,000 or an integral multiple thereof) of each Holder's Notes at a purchase
price equal to 101% of the aggregate principal amount at maturity thereof plus
accrued and unpaid interest and Liquidated Damages thereon, if any, to the date
of purchase (or if such a Change of Control Offer is prior to March 15, 2006 at
101% of the Accreted Value thereof plus Liquidated Damages thereon, if any, to
the date of purchase) (the "Change of Control Payment") . Within 30 days
following any Change of Control, the Company shall mail a notice to each Holder
setting forth the procedures governing the Change of Control Offer as required
by the Indenture.
(b) If the Company or a Subsidiary consummates any Asset Sales, within
five days of each date on which the aggregate amount of Excess Proceeds exceeds
$5.0 million, the Company shall commence an offer to all Holders of Notes (an
"Asset Sale Offer") pursuant to Section 3.09 of the Indenture to purchase the
maximum principal amount at maturity of Notes and pari passu indebtedness that
may be purchased out of the Excess Proceeds at an offer price in cash in an
amount equal to 100% of the principal amount at maturity thereof plus accrued
and unpaid interest and Liquidated Damages thereon, if any, to the date fixed
for the closing of such
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EXHIBIT A2
offer (or, in the case of purchases of Notes prior to March 15, 2006, at 100% of
the Accreted Value thereof, plus Liquidated Damages thereon, if any, to the date
of purchase) in accordance with the procedures set forth in the Indenture. To
the extent that the aggregate amount at maturity or Accreted Value (as
applicable) of the Notes tendered pursuant to an Asset Sale Offer is less than
the Excess Proceeds, the Company (or such Subsidiary) may use such deficiency
for any purpose not otherwise prohibited by the Indenture. If the aggregate
principal amount at maturity or Accreted Value (as applicable) of Notes and
other such pari passu indebtedness surrendered by Holders thereof exceeds the
amount of Excess Proceeds, the Trustee shall select the Notes to be purchased on
a pro rata basis. Notwithstanding the foregoing, the Company shall not be
required to repurchase any Notes pursuant to this paragraph 7(b) unless such
repurchase complies with the restricted payments covenants contained in the
other Indebtedness of the Company and its Subsidiaries. Holders of Notes that
are the subject of an offer to purchase will receive an Asset Sale Offer from
the Company prior to any related purchase date and may elect to have such Notes
purchased by completing the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Notes.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at least
30 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address. Notes in denominations
larger than $1,000 of principal amount at maturity may be redeemed in part but
only in whole multiples of $1,000 of principal amount at maturity, unless all of
the Notes held by a Holder are to be redeemed. On and after the Redemption Date,
the Notes or portions thereof called for redemption cease to accrete and
interest ceases to accrue thereon.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 of principal amount at maturity and
integral multiples of $1,000 of principal amount at maturity. The transfer of
Notes may be registered and Notes may be exchanged as provided in the Indenture.
The Registrar and the Trustee may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and the Company may
require a Holder to pay any taxes and fees required by law or permitted by the
Indenture. The Company need not exchange or register the transfer of any Note or
portion of a Note selected for redemption, except for the unredeemed portion of
any Note being redeemed in part. Also, the Company need not exchange or register
the transfer of any Notes for a period of 15 days before a selection of Notes to
be redeemed or during the period between a record date and the corresponding
Interest Payment Date.
This Regulation S Temporary Global Note is exchangeable in whole or in
part for one or more Global Notes only (i) on or after the termination of the
40-day restricted period (as defined in Regulation S) and (ii) upon presentation
of certificates (accompanied by an Opinion of Counsel, if applicable) required
by Article Two of the Indenture. Upon exchange of this Regulation S Temporary
Global Note for one or more Global Notes, the Trustee shall cancel this
Regulation S Temporary Global Note.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
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EXHIBIT A2
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount at maturity of the then
outstanding Notes voting as a single class, and any existing default or
compliance with any provision of the Indenture or the Notes may be waived with
the consent of the Holders of a majority in principal amount at maturity of the
then outstanding Notes voting as a single class. Without the consent of any
Holder of a Note, the Indenture or the Notes may be amended or supplemented to
cure any ambiguity, defect or inconsistency, to provide for uncertificated Notes
in addition to or in place of certificated Notes, to provide for the assumption
of the Company's obligations to Holders of the Notes in case of a merger or
consolidation, to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights under the Indenture of any such Holder, to comply with the requirements
of the SEC in order to effect or maintain the qualification of the Indenture
under the Trust Indenture Act.
12. DEFAULTS AND REMEDIES. Events of Default include: (i) default for
30 days in the payment when due of interest or Liquidated Damages on the Notes;
(ii) default in payment when due of principal (or, if prior to March 15, 2006,
the Accreted Value) of or premium, if any, on the Notes when the same becomes
due and payable at maturity, upon redemption (including in connection with an
offer to purchase) or otherwise, (iii) failure by the Company or any of its
Subsidiaries for, for 30 days after notice to the Company by the Trustee or the
Holders of at least 25% in aggregate principal amount at maturity of the Notes
then outstanding voting as a single class, to comply with Sections 5.01 or 5.02
of the Indenture or to consummate a Change of Control Offer or Asset Sale Offer
in accordance with Sections 4.10 and 4.14 of the Indenture; (iv) failure by the
Company for 60 days after notice to the Company by the Trustee or the Holders of
at least 25% in principal amount at maturity of the Notes then outstanding to
comply with certain other agreements in the Indenture or the Notes; (v) default
under certain other agreements relating to Indebtedness of the Company which
default results in the acceleration of such Indebtedness prior to its express
maturity; (vi) certain final judgments for the payment of money that remain
undischarged for a period of 60 days; and (vii) certain events of bankruptcy or
insolvency with respect to the Company or any of its Significant Subsidiaries.
If any Event of Default occurs and is continuing, the Trustee or the Holders of
at least 25% in principal amount at maturity of the then outstanding Notes may
declare all the Notes to be due and payable. Notwithstanding the foregoing, in
the case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes will become due and payable without further
action or notice. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture. Subject to certain limitations, Holders of a majority
in principal amount at maturity of the then outstanding Notes may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of the Notes notice of any continuing Default or Event of Default
(except a Default or Event of Default relating to the payment of principal (or,
if prior to March 15, 2006, the Accreted Value), premium or Liquidated Damages,
if any, or interest) if it determines that withholding notice is in their
interest. The Holders of a majority in aggregate principal amount at maturity of
the Notes then outstanding by notice to the Trustee may on behalf of the Holders
of all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of Default
in the payment of interest on, or the principal (or, if prior to March 15, 2006,
the Accreted Value) of, the Notes.
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EXHIBIT A2
The Company is required to deliver to the Trustee annually a statement regarding
compliance with the Indenture, and the Company is required upon becoming aware
of any Default or Event of Default, to deliver to the Trustee a statement
specifying such Default or Event of Default.
13. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes, the Notes
Guaranteeor the Indenture or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
15. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
16. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the Registration Rights
Agreement.
18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Emmis Escrow Corporation
One Emmis Plaza
40 Monument Circle, Suite 700
Indianapolis, IN 46204
Attention: Chief Financial Officer
A2-8
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EXHIBIT A2
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:
----------------------------------
(Insert assignee's legal name)
- --------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
--------------------------------------------------------
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date:
--------------------------
Your Signature:
------------------------------
(Sign exactly as your name
appears on the face of this Note)
Signature Guarantee*:
------------------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A2-9
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EXHIBIT A2
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.14 of the Indenture, check the appropriate box
below:
[ ] Section 4.10 [ ] Section 4.14
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased:
$
-----------------------------------
Date:
--------------------------
Your Signature:
-------------------------------
(Sign exactly as your name
appears on the face of this Note)
Tax Identification No.:
------------------------
Signature Guarantee*:
------------------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
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EXHIBIT A2
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary Global
Note for an interest in another Global Note, or of other Restricted Global Notes
for an interest in this Regulation S Temporary Global Note, have been made:
Principal Amount
Amount of decrease in Amount of increase in of this Signature of
Principal Amount Principal Amount Global Note authorized officer of
of of following such decrease Trustee or Note
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- ---------------- ---------------- ------------- ---------
A2-11
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EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
[Company address block]
[Registrar address block]
Re: [fill in full title of securities]
Reference is hereby made to the Indenture, dated as of March 27, 2001
(the "Indenture"), between Emmis Escrow Corporation (the "Company"), as issuer,
and The Bank of Nova Scotia Trust Company of New York, as trustee. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Indenture.
___________________ (the "Transferor") owns and proposes to transfer
the Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to ___________________________ (the "Transferee"), as further specified in Annex
A hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN THE 144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO RULE 144A. The Transfer
is being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Definitive Note and
in the Indenture and the Securities Act.
2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN THE REGULATION S GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO REGULATION S.
The Transfer is being effected pursuant to and in accordance with Rule 903 or
Rule 904 under the Securities Act and, accordingly, the Transferor hereby
further certifies that (i) the Transfer is not being made to a person in the
United States and (x) at the time the buy order was originated, the Transferee
was outside the United States or such Transferor and any Person acting on its
behalf reasonably believed and believes that the Transferee was outside the
United States or (y) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention
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of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the
Securities Act, (iii) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act and (iv) if the proposed
transfer is being made prior to the expiration of the Restricted Period, the
transfer is not being made to a U.S. Person or for the account or benefit of a
U.S. Person (other than an Initial Purchaser). Upon consummation of the proposed
transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will be subject to the restrictions on
Transfer enumerated in the Private Placement Legend printed on the Regulation S
Global Note and/or the Definitive Note and in the Indenture and the Securities
Act. [May not be checked while a 3(c)(7) Issuer is an obligor under the Notes]
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE IAI GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO ANY
PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a)[ ] such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;
or
(b)[ ] such Transfer is being effected to the Company or a
subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an
effective registration statement under the Securities Act and in
compliance with the prospectus delivery requirements of the Securities
Act.
or
(d) [ ] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or
Rule 904, and the Transferor hereby further certifies that it has not
engaged in any general solicitation within the meaning of Regulation D
under the Securities Act and the Transfer complies with the transfer
restrictions applicable to beneficial interests in a Restricted Global
Note or Restricted Definitive Notes and the requirements of the
exemption claimed, which certification is supported by (1) a
certificate executed by the Transferee in the form of Exhibit D to the
Indenture and (2) an Opinion of Counsel provided by the Transferor or
the Transferee (a copy of which the Transferor has attached to this
certification), to the effect that such Transfer is in compliance with
the Securities Act. Upon consummation of the proposed transfer in
accordance with the terms of the Indenture, the transferred beneficial
interest or
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Definitive Note will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the IAI Global
Note and/or the Definitive Notes and in the Indenture and the
Securities Act.
4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
being effected pursuant to and in accordancE with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer
is being effected pursuant to and in accordaNce with Rule 903 or Rule 904 under
the Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture. [May not be
checked while a 3(c)(7) Issuer is an obligor under the Notes]
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
5. CHECK FOR ALL TRANSFERS.
(a) [ ] The Transferor reasonably believes the Transferee is a
"qualified purchaser" (as defined in the United States Investment Company Act of
1940, hereinafter referred to as the "Investment Company Act")(a "Qualified
Purchaser"), a company each of whose beneficial owners is a Qualified Purchaser,
a "knowledgeable employee" with respect to the Issuer within the meaning of Rule
3c-5 under the Investment Company(a "Knowledgeable Employee") or a
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company owned exclusively by Knowledgeable Employees. [To be included only for
so long as a 3(c)(7) Issuer is an obligor under the Notes.]
(b) [ ] Prior to the Escrow Corp. Merger or the exchange of the Notes
for the exchangeable preferred stock, the Transferor reasonably believes that
the Transferee is not, and is not acquiring the securities with the assets of or
for or on behalf of, and will not sell or otherwise transfer the securities to
any "employee benefit plan" (as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) subject to Title I
of ERISA, any "plan" subject to Section 4975 of the Code or any entity whose
underlying assets include the assets of any such employee benefit plan or plan
(any such employee benefit plan, plan or entity, a "Plan").
(c) [ ] At and following the Escrow Corp. Merger, the Transferor
reasonably believes that the Transferee is not and will not become, and is not
acquiring the securities with the assets of, or for or on behalf of, and will
not sell or otherwise transfer the securities to any Plan except to the extent
that the acquisition and holding of the securities is exempt from the prohibited
transaction provisions of ERISA and the Code by reason of: (A) Prohibited
Transaction Class Exemption 91-38 issued by the Department of Labor; (B)
Prohibited Transaction Class Exemption 90-1 issued by the Department of Labor;
(C) Prohibited Transaction Class Exemption 84-14 issued by the Department of
Labor; (D) Prohibited Transaction Class Exemption 95-60 issued by the Department
of Labor; or (E) Prohibited Transaction Class Exemption 96-23 issued by the
Department of Labor.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
Date:
-------------------------
----------------------------------------------
[Insert Name of Transferor]
By:
----------------------------------------------
Name:
Title:
Signature Guarantee*:
------------------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
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ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP ____________), or
(ii) [ ] Regulation S Global Note (CUSIP ____________), or
(iii) [ ] IAI Global Note (CUSIP _____________); or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP ____________), or
(ii) [ ] Regulation S Global Note (CUSIP ____________), or
(iii) [ ] IAI Global Note (CUSIP _____________); or
(iv) [ ] Unrestricted Global Note (CUSIP ____________); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
124
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
[Company address block]
[Registrar address block]
Re: [fill in full title of securities]
(CUSIP ____________)
Reference is hereby made to the Indenture, dated as of March
27, 2001 (the "Indenture"), between Emmis Escrow Corporation, as issuer (the
"Company"), and The Bank of Nova Scotia Trust Company of New York, as trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
__________________________ (the "Owner") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $____________ in such Note[s] or interests (the "Exchange").
In connection with the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR
BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Global Notes and pursuant to and in accordance with the United States Securities
Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
beneficial interest in an Unrestricted Global Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
(b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive Note
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the Definitive Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
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(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE
TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE
TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR
BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for a
Restricted Definitive Note with an equal principal amount, the Owner hereby
certifies that the Restricted Definitive Note is being acquired for the Owner's
own account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Definitive Note and in
the Indenture and the Securities Act.
(b) CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CHECK ONE] [ ] 144A Global Note, [ ] Regulation S Global Note, [ ] IAI Global
Note with an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer and (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Notes and pursuant to
and in accordance with the Securities Act, and in compliance with any applicable
blue sky securities laws of any state of the United States. Upon consummation of
the proposed Exchange in accordance with the terms of the Indenture, the
beneficial interest issued will be subject to the restrictions on transfer
enumerated
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in the Private Placement Legend printed on the relevant Restricted Global Note
and in the Indenture and the Securities Act.
3. CHECK FOR ALL TRANSFERS.
(a) [ ] The Transferor reasonably believes the Transferee is a
"qualified purchaser" (as defined in the United States Investment Company Act of
1940, hereinafter referred to as the "Investment Company Act") (a "Qualified
Purchaser"), a company each of whose beneficial owners is a Qualified Purchaser,
a "knowledgeable employee" with respect to the Issuer within the meaning of Rule
3c-5 under the Investment Company (a "Knowledgeable Employee") or a company
owned exclusively by Knowledgeable Employees. [To be included only for so long
as a 3(c)(7) Issuer is an obligor under the Notes.]
(b) [ ] Prior to the Escrow Corp. Merger or the exchange of
the Notes for the exchangeable preferred stock, the Transferor reasonably
believes that the Transferee is not, and is not acquiring the securities with
the assets of or for or on behalf of, and will not sell or otherwise transfer
the securities to any "employee benefit plan" (as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")) subject
to Title I of ERISA, any "plan" subject to Section 4975 of the Code or any
entity whose underlying assets include the assets of any such employee benefit
plan or plan (any such employee benefit plan, plan or entity, a "Plan").
(c) [ ] At and following the Escrow Corp. Merger, the
Transferor reasonably believes that the Transferee is not and will not become,
and is not acquiring the securities with the assets of, or for or on behalf of,
and will not sell or otherwise transfer the securities to any Plan except to the
extent that the acquisition and holding of the securities is exempt from the
prohibited transaction provisions of ERISA and the Code by reason of: (A)
Prohibited Transaction Class Exemption 91-38 issued by the Department of Labor;
(B) Prohibited Transaction Class Exemption 90-1 issued by the Department of
Labor; (C) Prohibited Transaction Class Exemption 84-14 issued by the Department
of Labor; (D) Prohibited Transaction Class Exemption 95-60 issued by the
Department of Labor; or (E) Prohibited Transaction Class Exemption 96-23 issued
by the Department of Labor.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
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Date:___________________
_______________________________________
[Insert Name of Transferor]
By: ___________________________________
Name:
Title:
Signature Guarantee*: ___________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
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FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
[Company address block]
[Registrar address block]
Re: [fill in full title of securities]
Reference is hereby made to the Indenture, dated as of March
27, 2001 (the "Indenture"), between Emmis Escrow Corporation, as issuer (the
"Company") and The Bank of Nova Scotia Trust Company of New York, as trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
In connection with our proposed purchase of $____________
aggregate principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or
any interest therein is subject to certain restrictions and conditions set forth
in the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not
been registered under the Securities Act, and that the Notes and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell the Notes or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) to a person who the Seller reasonably believes is a "qualified
institutional buyer" purchasing for its own account or for the account of a
qualified institutional buyer meeting the requirements of Rule 144A, (C) in a
transaction meeting the requirements of Rule 144 under the Securities Act, (D)
in accordance with another exemption from the registration requirements of the
Securities Act (and based upon an opinion of counsel acceptable to the Company)
or (E) pursuant to an effective registration statement and, in each case, in
accordance with the applicable securities laws of any state of the United States
or any other applicable jurisdiction, and we further agree to provide to any
person purchasing the Definitive Note or beneficial interest in a Global Note
from us in a transaction meeting the requirements of clauses (A) through (E) of
this paragraph a notice advising such purchaser that resales thereof are
restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal
129
opinions and other information as you and the Company may reasonably require to
confirm that the proposed sale complies with the foregoing restrictions. We
further understand that the Notes purchased by us will bear a legend to the
foregoing effect.
4. We are an institutional "accredited investor" (as defined
in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Notes, and
we and any accounts for which we are acting are each able to bear the economic
risk of our or its investment.
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
6. We understand that so long as a 3(c)(7) Issuer is an
obligor under the Notes, the Notes (and any interest therein) may be purchased
solely by investors who demonstrate to the Company's satisfaction that they meet
the definition of a "qualified purchaser" or a "knowledgeable employee" for the
purpose of Section 3(c)(7) of the Investment Company Act of 1940 and the rules
thereunder.
7. (a) Prior to the Escrow Corp. Merger or the exchange of the
Notes for the exchangeable preferred stock, we are not and will not become, and
are not acquiring the securities with the assets of or for or on behalf of, and
will not sell or otherwise transfer the securities to any "employee benefit
plan" (as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA")) subject to Title I of ERISA, any "plan" subject
to Section 4975 of the Code or any entity whose underlying assets include the
assets of any such employee benefit plan or plan (any such employee benefit
plan, plan or entity, a "Plan").
(b) At and following the Escrow Corp. Merger, we are not
and will not become, and are not acquiring the securities with the assets of, or
for or on behalf of, and will not sell or otherwise transfer the securities to
any Plan except to the extent that the acquisition and holding of the securities
is exempt from the prohibited transaction provisions of ERISA and the Code by
reason of: (A) Prohibited Transaction Class Exemption 91-38 issued by the
Department of Labor; (B) Prohibited Transaction Class Exemption 90-1 issued by
the Department of Labor; (C) Prohibited Transaction Class Exemption 84-14 issued
by the Department of Labor; (D) Prohibited Transaction Class Exemption 95-60
issued by the Department of Labor; or (E) Prohibited Transaction Class Exemption
96-23 issued by the Department of Labor.
You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby.
Date: _____________________
__________________________________________
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[Insert Name of Accredited Investor]
By: ______________________________________
Name:
Title:
Signature Guarantee*: _____________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
131
Exhibit E
ADDITIONAL PROVISIONS RELATING TO SECTION 3(C)(7)
UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED
The following provisions shall apply for so long as a 3(c)(7)
Issuer is an obligor under the Notes:
1. DTC Notice to Investors. The Company shall (a) request of
the Depository, and cooperate with the Depository to ensure, that the
Depository's security description and delivery order include a "3(c)(7) marker"
and confirm that the Depository's Reference Directory contains an accurate
description of the restrictions on the holding and transfer of the Notes due to
the Company's reliance on the exclusion to registration provided by Section
3(c)(7) of the Investment Company Act, (b) request of the Depository, and
cooperate with the Depository to ensure, that the Depository send to its
participants in connection with the initial offering of the Notes a notice
substantially in the form attached as Exhibit E-1 hereto, (c) request of the
Depository, and cooperate with the Depository to ensure, that the Depository's
Reference Directory include each class of Notes (and the applicable CUSIP
numbers for the Notes) in the listing of 3(c)(7) issues together with an
attached description of the limitations as to the distribution, purchase, sale
and holding of the Notes and (d) at least five Business Days prior to the date
upon which the Annual Report shall be delivered by the Company, the Company
shall obtain from DTC a list (the "DTC List") of all participants that are
holding an interest in the Notes as of such date.
2. Deemed Representations of Holders. Each holder of Notes or
beneficial interests therein will be deemed to have represented and agreed with
the Company as follows:
(i) The holder is a QIB and a qualified purchaser within
the meaning of Section 2(a)(51)(A) of the Investment Company Act (a
"Qualified Purchaser"), (B) the holder is not a broker-dealer that owns
and invests on a discretionary basis less than $25,000,000 in
securities of issuers that are not affiliated persons of the dealer,
(C) the holder is purchasing the Notes for its own account or for the
account of another Qualified Purchaser that is also a QIB as to which
the holder exercises sole investment discretion, (D) the holder and any
such account is acquiring the Notes as principal for its own account
for investment and not for sale in connection with any distribution
thereof, (E) the holder and any such account was not formed solely for
the purpose of investing in the Notes (except when each beneficial
owner of the holder or any such account is a Qualified Purchaser), (F)
to the extent the holder (or any account for which it is purchasing the
Notes) is a private investment company formed before April 30, 1996,
the holder and each such account has received the necessary consent
from its beneficial owners, (G) the holder and any such account is not
a pension, profit sharing or other retirement trust fund or plan in
which the partners, beneficiaries or participants, as applicable, may
designate the particular investments to be made, (H) the holder agrees
that it and each such account shall not hold such Notes for the benefit
of any other Person and shall be the sole beneficial owner thereof for
all purposes and that it shall not sell participation interests in the
Notes or enter into any other arrangement pursuant to which any other
Person shall be entitled to a beneficial interest in the distributions
on the Notes, (I) the Notes purchased directly or indirectly by the
holder or any account for which it is
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purchasing the Notes constitute an investment of no more than 40% of
the holder's and each such account's assets (except when each
beneficial owner of the holder and each such account is a Qualified
Purchaser), (J) the holder will provide notice of the transfer
restrictions set forth in this Indenture (including the exhibits
hereto) to any transferee of the Notes and (K) the holder understands
and agrees that any purported transfer of the Notes to a holder that
does not comply with the requirements of this Indenture shall be null
and void ab initio.
(ii) The holder understands that the Notes have not been and
will not be registered under the Securities Act, and may be reoffered,
resold or pledged or otherwise transferred only (A) to a person whom
the purchaser reasonably believes is a QIB purchasing for its own
account or for the account of a QIB as to which the purchaser exercises
sole investment discretion in a transaction meeting the requirements of
Rule 144A and (B) in accordance with all applicable securities laws of
the states of the United States. The holder also understands that the
Company has not been registered under the Investment Company Act.
3. Certain Transactions Void; Company Right to Force Sale or
Redemption.
(i) Notwithstanding anything to the contrary elsewhere in this
Indenture, any transfer of a beneficial interest in any Notes to a
person that is not both a Qualified Institutional Buyer and a Qualified
Purchaser shall be null and void and any such purported transfer of
which the Company or the Trustee shall have notice may be disregarded
by the Company and the Trustee for all purposes. The Trustee shall hold
any funds conveyed by the intended transferee of such interest in such
Rule 144A Global Note in trust for the transferor and shall promptly
reconvey such funds to such Person in accordance with the written
instructions thereof delivered to the Trustee at its address listed in
Section 10.02.
(ii) If any person that is not both a Qualified Institutional
Buyer and a Qualified Purchaser (any such person, a "Non-Permitted
Holder") shall become the owner of a beneficial interest in any Global
Note, or the Company or the Trustee on its behalf shall, promptly after
discovery that such person is a Non-Permitted Holder by the Company or
the Trustee (and notice by the Trustee to the Company, if the Trustee
makes the discovery), send notice to such Non-Permitted Holder
demanding that such Non-Permitted Holder transfer its interest to a
Person that is not a Non-Permitted Holder within thirty (30) days of
the date of such notice. If such Non-Permitted Holder fails to so
transfer its Notes, the Company shall have the right, without further
notice to the Non-Permitted Holder, either (i) to redeem such Notes at
a redemption price equal to the principal amount thereof plus accrued
interest thereon or (ii) to sell such Notes or such Non-Permitted
Holder's interest in such Notes to a purchaser selected by the Company
that is a not a Non-Permitted Holder on such terms as the Company may
choose. The Company, or the Trustee acting on behalf of the Company,
may select the purchaser by soliciting one or more bids from one or
more brokers or other market professionals that regularly deal in
securities similar to the Notes, and selling such Notes to the highest
such bidder. However, the Company or the Trustee may select a purchaser
by any other means
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133
determined by it in its sole discretion. The Holder of each Note, the
Non-Permitted Holder and each other Person in the chain of title from
the Holder to the Non-Permitted Holder, by its acceptance of an
interest in the Notes, agrees to cooperate with the Company and the
Trustee to effect such transfers. The proceeds of any such forced sale,
net of any commissions, expenses and taxes due in connection with such
sale shall be remitted to the Non-Permitted Holder. The terms and
conditions of any sale under this subsection shall be determined in the
sole discretion of the Company, and the Company shall not be liable to
any Person having an interest in the Notes sold as a result of any such
sale or the exercise of such discretion.
4. CUSIP Numbers. The Company shall (i) request of Standard
& Poor's, and shall cooperate with Standard & Poor's, to ensure that all CUSIP
numbers identifying the Notes shall have a "fixed field" attached thereto that
contains "3c7" and "144A" indicators and (ii) take steps to cause the initial
purchasers to require that all "confirms" of trades of the Notes contain CUSIP
numbers with such "fixed field" identifiers.
5. Bloomberg and other Third-Party Vendor Screens. The Company
shall cause the Bloomberg screen or screens containing information about the
Notes to include the following language: (i) the "Note Box" on the bottom of
"Security Display" page describing the Notes shall state: "Iss'd Under
144A/3(c)(7)", (ii) the "Security Display" page shall have the flashing red
indicator "See Other Available Information," and (iii) the indicator shall link
to the "Additional Security Information" page, which shall state that the Notes
"are being offered in reliance on the exemption from registration under Rule
144A of the Securities Act of 1933, as amended (the "Securities Act") to persons
who are both (x) qualified institutional buyers (as defined in Rule 144A under
the Securities Act) and (y) qualified purchasers (as defined under Section
3(c)(7) under the Investment Company Act of 1940)." The Company shall require
that any other third-party vendor screens containing information about the Notes
include substantially similar language to clauses (i) through (iii) above.
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EXHIBIT E-1
EXAMPLE OF THE "IMPORTANT NOTICE" FOR A
PROPOSED RULE 144A/SECTION 3(C)(7) ISSUE
THAT DTC WILL SEND TO ITS PARTICIPANTS
IF IT IS ASKED TO DO SO
THE DEPOSITORY TRUST COMPANY
IMPORTANT
B#: [number]
DATE: [date]
TO: ALL PARTICIPANTS
FROM: [name], [title], Underwriting Department
ATTENTION: [Managing Partner/Officer, Cashier, Operations, Data Processing and
Underwriting Managers]
SUBJECT: Section 3(c)(7) restrictions for [Issuer name] [title of security]
(A) CUSIP Number [CUSIP number]
(B) Security Description [issuer name] [title of security]
(C) Offer Amount $[amount]
(D) Lead Initial Purchaser [name of managing underwriter]
(E) Paying Agent [name of paying agent]
(F) Closing Date [closing date]
Special Instructions: See Attached Important Instructions from the Issuer.
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135
[ISSUER LETTERHEAD]
[This is the form letter that the Company should send to DTC which
DTC will send to its participants in an "Important Notice"]
[Title of Security]
[CUSIP No. of Security]
The Issuer and the lead [Initial Purchaser(s)/Distributor(s)/
Agent(s)] are putting Participants on notice that they are required to follow
these purchase and transfer restrictions with regard to the above-referenced
security.
In order to qualify for the exemption provided by Section
3(c)(7) under the Investment Company Act of 1940, as amended (the "Investment
Company Act"), and the exemption provided by Rule 144A under the Securities Act
of 1993, as amended (the "Securities Act"), offers, sales and resales of the
[insert title of securities] (the "Securities") may only be made in minimum
denominations of $________ to "qualified institutional buyers" ("QIBs") within
the meaning of Rule 144A that are also "qualified purchasers" ("QPs") within the
meaning of Section 2(a)(51)(A) of the Investment Company Act. Each purchaser of
Securities (A) represents to and agrees with the Issuer and the [Initial
Purchaser(s)/Distributor(s)/ Agents(s)] that (i) the purchaser is a QIB who is a
QP (a "QIB/QP"); (ii) the purchaser is not a broker-dealer which owns and
invests on a discretionary basis less than $25 million in securities of
unaffiliated issuers; (iii) the purchaser is not a pension, profit sharing or
other retirement trust fund or plan in which the partners, beneficiaries or
participants, as applicable, may designate the particular investments to be
made; (iv) the QIB/QP is acting for its own account or the account of another
QIB/QP; (v) the purchaser was not formed for the specific purpose of investing
in the Securities (except when each beneficial owner of the purchaser and each
such account is a qualified purchaser for purposes of Section 3(c)(7) of the
Investment Company Act), (vi) the purchaser and each account for which it is
purchasing will hold and transfer at least the minimum denomination of
securities, and (vii) the purchaser will provide notice of the transfer
restrictions to any subsequent transferees and (B) acknowledges that the Issuer
has not been registered under the Investment Company Act and the Securities have
not been registered under the Securities Act and represents to and agrees with
the Issuer and the [Initial Purchaser(s)/Distributor(s)/Agent(s)] that, for so
long as the Securities are outstanding, it will not offer, resell, pledge or
otherwise transfer the Securities in the United States or to a Person except to
a QIB that is also a QP in a transaction meeting the requirements of Rule 144A.
Each purchaser further understands that the Securities will bear a legend with
respect to such transfer restrictions. See "Notice to Investors" in the [insert
title of private offering memorandum].
The charter, bylaws, organizational documents or securities
issuance documents of the Issuer provide that the Issuer will have the right to
(i) require any holder of Securities who is determined not to be both a QIB and
a QP to sell the Securities to a QIB that is also a QP or (ii) redeem or resell
any Securities held by such a holder on specified terms. In addition, the Issuer
has the right to refuse to register or otherwise honor a transfer of Securities
to a proposed transferee that is a Person who is not both a QIB and a QP.
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The restrictions on transfer required by the Issuer (outlined
above) will be reflected under the notation "3c7" in upcoming editions of DTC's
Reference Directory.
Any questions or comments regarding this subject may be directed to [Issuer
contact person] (___) ____-_____.
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