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JACOR COMMUNICATIONS COMPANY
ISSUER,
AND
JACOR COMMUNICATIONS, INC.,
PARENT GUARANTOR
AND
UNCONDITIONALLY GUARANTEED BY THE SUBSIDIARY
GUARANTORS NAMED HEREIN
AND
THE BANK OF NEW YORK
TRUSTEE
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INDENTURE
Dated as of February 9, 1998
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$120,000,000
8% Senior Subordinated Notes due 2010
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TABLE OF CONTENTS
PAGE
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE. . . . . . . . . . . . . 1
SECTION 1.1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.2. Incorporation by Reference of TIA . . . . . . . . . . . . . . .23
SECTION 1.3. Rules of Construction . . . . . . . . . . . . . . . . . . . . .24
ARTICLE II
THE SECURITIES. . . . . . . . . . . . . . . . . . . .24
SECTION 2.1. Form and Dating . . . . . . . . . . . . . . . . . . . . . . . .24
SECTION 2.2. Execution and Authentication. . . . . . . . . . . . . . . . . .25
SECTION 2.3. Registrar and Paying Agent. . . . . . . . . . . . . . . . . . .26
SECTION 2.4. Paying Agent to Hold Assets in Trust. . . . . . . . . . . . . .27
SECTION 2.5. Securityholder Lists. . . . . . . . . . . . . . . . . . . . . .27
SECTION 2.6. Transfer and Exchange . . . . . . . . . . . . . . . . . . . . .27
SECTION 2.7. Replacement Securities. . . . . . . . . . . . . . . . . . . . .30
SECTION 2.8. Outstanding Securities. . . . . . . . . . . . . . . . . . . . .30
SECTION 2.9. Treasury Securities . . . . . . . . . . . . . . . . . . . . . .31
SECTION 2.10. Temporary Securities. . . . . . . . . . . . . . . . . . . . . .31
SECTION 2.11. Cancellation. . . . . . . . . . . . . . . . . . . . . . . . . .31
SECTION 2.12. Defaulted Interest. . . . . . . . . . . . . . . . . . . . . . .32
SECTION 2.13. CUSIP Numbers . . . . . . . . . . . . . . . . . . . . . . . . .33
ARTICLE III
REDEMPTION . . . . . . . . . . . . . . . . . . .33
SECTION 3.1. Right of Redemption . . . . . . . . . . . . . . . . . . . . . .34
SECTION 3.2. Notices to Trustee and Paying Agent . . . . . . . . . . . . . .34
SECTION 3.3. Selection of Securities to Be Redeemed. . . . . . . . . . . . .34
SECTION 3.4. Notice of Redemption. . . . . . . . . . . . . . . . . . . . . .34
SECTION 3.5. Effect of Notice of Redemption. . . . . . . . . . . . . . . . .36
SECTION 3.6. Deposit of Redemption Price . . . . . . . . . . . . . . . . . .36
SECTION 3.7. Securities Redeemed in Part . . . . . . . . . . . . . . . . . .36
ARTICLE IV
COVENANTS . . . . . . . . . . . . . . . . . . .37
SECTION 4.1. Payment of Securities . . . . . . . . . . . . . . . . . . . . .37
SECTION 4.2. Maintenance of Office or Agency . . . . . . . . . . . . . . . .37
SECTION 4.3. Limitation on Restricted Payments . . . . . . . . . . . . . . .38
i
SECTION 4.4. Corporate Existence . . . . . . . . . . . . . . . . . . . . . .38
SECTION 4.5. Payment of Taxes and Other Claims . . . . . . . . . . . . . . .39
SECTION 4.6. Maintenance of Properties and Insurance . . . . . . . . . . . .39
SECTION 4.7. Compliance Certificate; Notice of Default . . . . . . . . . . .40
SECTION 4.8. Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . .40
SECTION 4.9. Limitation on Status as Investment Company. . . . . . . . . . .41
SECTION 4.10. Limitation on Transactions with Affiliates. . . . . . . . . . .41
SECTION 4.11. Limitation on Incurrence of Additional Indebtedness and
Disqualified Capital Stock. . . . . . . . . . . . . . . . . . .42
SECTION 4.12. Limitations on Dividends and Other Payment Restrictions
Affecting Subsidiaries. . . . . . . . . . . . . . . . . . . . .42
SECTION 4.13. Limitations on Layering Indebtedness; Liens . . . . . . . . . .43
SECTION 4.14. Limitation on Sale of Assets and Subsidiary Stock . . . . . . .44
SECTION 4.15. Limitation on Asset Swaps . . . . . . . . . . . . . . . . . . .49
SECTION 4.16. Limitation on Lines of Business . . . . . . . . . . . . . . . .49
SECTION 4.17. Restriction on Sale and Issuance of Subsidiary Stock. . . . . .49
SECTION 4.18. Waiver of Stay, Extension or Usury Laws . . . . . . . . . . . .49
ARTICLE V
SUCCESSOR CORPORATION . . . . . . . . . . . . . . . .50
SECTION 5.1. Limitation on Merger, Sale or Consolidation . . . . . . . . . .50
SECTION 5.2. Successor Corporation Substituted . . . . . . . . . . . . . . .50
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES. . . . . . . . . . . . . . . . .51
SECTION 6.1. Events of Default . . . . . . . . . . . . . . . . . . . . . . .51
SECTION 6.2. Acceleration of Maturity Date; Rescission and Annulment . . . .52
SECTION 6.3. Collection of Indebtedness and Suits for Enforcement by
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . .54
SECTION 6.4. Trustee May File Proofs of Claim. . . . . . . . . . . . . . . .55
SECTION 6.5. Trustee May Enforce Claims Without Possession of
Securities. . . . . . . . . . . . . . . . . . . . . . . . . . .56
SECTION 6.6. Priorities. . . . . . . . . . . . . . . . . . . . . . . . . . .56
SECTION 6.7. Limitation on Suits . . . . . . . . . . . . . . . . . . . . . .57
SECTION 6.8. Unconditional Right of Holders to Receive Principal,
Premium and Interest. . . . . . . . . . . . . . . . . . . . . .57
SECTION 6.9. Rights and Remedies Cumulative. . . . . . . . . . . . . . . . .58
SECTION 6.10. Delay or Omission Not Waiver. . . . . . . . . . . . . . . . . .58
SECTION 6.11. Control by Holders. . . . . . . . . . . . . . . . . . . . . . .58
SECTION 6.12. Waiver of Past Default. . . . . . . . . . . . . . . . . . . . .59
ii
SECTION 6.13. Undertaking for Costs . . . . . . . . . . . . . . . . . . . . .59
SECTION 6.14. Restoration of Rights and Remedies. . . . . . . . . . . . . . .60
ARTICLE VII
TRUSTEE . . . . . . . . . . . . . . . . . . . .60
SECTION 7.1. Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . .60
SECTION 7.2. Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . .61
SECTION 7.3. Individual Rights of Trustee. . . . . . . . . . . . . . . . . .62
SECTION 7.4. Trustee's Disclaimer. . . . . . . . . . . . . . . . . . . . . .62
SECTION 7.5. Notice of Default . . . . . . . . . . . . . . . . . . . . . . .62
SECTION 7.6. Reports by Trustee to Holders . . . . . . . . . . . . . . . . .62
SECTION 7.7. Compensation and Indemnity. . . . . . . . . . . . . . . . . . .62
SECTION 7.8. Replacement of Trustee. . . . . . . . . . . . . . . . . . . . .65
SECTION 7.9. Successor Trustee by Merger, Etc. . . . . . . . . . . . . . . .66
SECTION 7.10. Eligibility; Disqualification . . . . . . . . . . . . . . . . .66
SECTION 7.11. Preferential Collection of Claims Against the Company . . . . .66
SECTION 8.1. Discharge; Option to Effect Legal Defeasance or
Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . .66
SECTION 8.2. Legal Defeasance and Discharge. . . . . . . . . . . . . . . . .67
SECTION 8.3. Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . .67
SECTION 8.4. Conditions to Legal or Covenant Defeasance. . . . . . . . . . .68
SECTION 8.5. Deposited Cash and U.S. Government Obligations to be
Held in Trust; Other Miscellaneous Provisions . . . . . . . . .70
SECTION 8.6. Repayment to the Company. . . . . . . . . . . . . . . . . . . .70
SECTION 8.7. Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . .71
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS . . . . . . . . . . . . . . .71
SECTION 9.1. Supplemental Indentures Without Consent of Holders. . . . . . .71
SECTION 9.2. Amendments, Supplemental Indentures and Waivers with
Consent of Holders. . . . . . . . . . . . . . . . . . . . . . .72
SECTION 9.3. Compliance with TIA.. . . . . . . . . . . . . . . . . . . . . .73
SECTION 9.4. Revocation and Effect of Consents . . . . . . . . . . . . . . .74
SECTION 9.5. Notation on or Exchange of Securities . . . . . . . . . . . . .74
SECTION 9.6. Trustee to Sign Amendments, Etc.. . . . . . . . . . . . . . . .75
ARTICLE X
SUBORDINATION . . . . . . . . . . . . . . . . . .75
SECTION 10.1. Securities Subordinated to Senior Debt. . . . . . . . . . . . .75
SECTION 10.2. No Payment on Securities in Certain Circumstances . . . . . . .75
iii
SECTION 10.3. Securities Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization. . . . . . . . . . .77
SECTION 10.4. Securityholders to Be Subrogated to Rights of Holders of
Senior Debt . . . . . . . . . . . . . . . . . . . . . . . . . .78
SECTION 10.5. Obligations of the Company and the Guarantors
Unconditional . . . . . . . . . . . . . . . . . . . . . . . . .79
SECTION 10.6. Trustee Entitled to Assume Payments Not Prohibited in Absence
of Notice . . . . . . . . . . . . . . . . . . . . . . . . . . .80
SECTION 10.7. Application by Trustee of Assets Deposited with It. . . . . . .80
SECTION 10.8. Subordination Rights Not Impaired by Acts or Omissions of the
Company, the Guarantors or Holders of Senior Debt . . . . . . .80
SECTION 10.9. Securityholders Authorize Trustee to Effectuate Subordination
of Securities . . . . . . . . . . . . . . . . . . . . . . . . .81
SECTION 10.10. Right of Trustee to Hold Senior Debt. . . . . . . . . . . . . .81
SECTION 10.11. Article X Not to Prevent Events of Default. . . . . . . . . . .81
SECTION 10.12. No Fiduciary Duty of Trustee to Holders of Senior Debt. . . . .82
ARTICLE XI
RIGHT TO REQUIRE REPURCHASE. . . . . . . . . . . . . . .82
SECTION 11.1. Repurchase of Securities at Option of the Holder Upon a Change
of Control. . . . . . . . . . . . . . . . . . . . . . . . . . .82
ARTICLE XII
GUARANTY. . . . . . . . . . . . . . . . . . . .85
SECTION 12.1. Guaranty. . . . . . . . . . . . . . . . . . . . . . . . . . . .85
SECTION 12.2. Execution and Delivery of Guaranty. . . . . . . . . . . . . . .87
SECTION 12.3. Subsidiary Guarantors . . . . . . . . . . . . . . . . . . . . .87
SECTION 12.4. Guarantor May Consolidate, Etc., on Certain Terms.. . . . . . .88
SECTION 12.5. Release of Guarantors.. . . . . . . . . . . . . . . . . . . . .89
SECTION 12.6. Certain Bankruptcy Events . . . . . . . . . . . . . . . . . . .90
ARTICLE XIII
MISCELLANEOUS. . . . . . . . . . . . . . . . . . .90
SECTION 13.1. TIA Controls. . . . . . . . . . . . . . . . . . . . . . . . . .91
SECTION 13.2. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . .91
SECTION 13.3. Communications by Holders with Other Holders. . . . . . . . . .91
SECTION 13.4. Certificate and Opinion as to Conditions Precedent. . . . . . .91
SECTION 13.5. Statements Required in Certificate or Opinion . . . . . . . . .92
SECTION 13.6. Rules by Trustee, Paying Agent, Registrar . . . . . . . . . . .92
SECTION 13.7. Non-Business Days . . . . . . . . . . . . . . . . . . . . . . .92
iv
SECTION 13.8. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . .93
SECTION 13.9. No Adverse Interpretation of Other Agreements . . . . . . . . .93
SECTION 13.10. No Recourse against Others. . . . . . . . . . . . . . . . . . .93
SECTION 13.11. Successors. . . . . . . . . . . . . . . . . . . . . . . . . . .94
SECTION 13.12. Duplicate Originals . . . . . . . . . . . . . . . . . . . . . .94
SECTION 13.13. Severability. . . . . . . . . . . . . . . . . . . . . . . . . .94
SECTION 13.14. Table of Contents, Headings, Etc. . . . . . . . . . . . . . . .94
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .95
Exhibit A
[FORM OF SECURITY] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .A-1
v
INDENTURE, dated as of February 9, 1998, by and among Jacor
Communications Company, a Florida corporation (the "Company"), Jacor
Communications, Inc., a Delaware corporation (the "Parent Guarantor"), the
Subsidiary Guarantors referred to below and The Bank of New York, a New York
banking corporation, as trustee (the "Trustee").
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. DEFINITIONS.
"ACCELERATION NOTICE" shall have the meaning specified in Section 6.2.
"ACCEPTANCE AMOUNT" shall have the meaning specified in Section 4.14.
"ACQUIRED INDEBTEDNESS" means Indebtedness or Disqualified Capital
Stock of any person existing at the time such person becomes a Subsidiary of the
Company, including by designation, or is merged or consolidated into or with
either of the Company or one of its Subsidiaries; provided, that such
Indebtedness was not incurred in anticipation of, or in connection with, and was
outstanding prior to such person becoming a Subsidiary of the Company.
"ACQUISITION" means the purchase or other acquisition of any person or
substantially all the assets of any person by any other person, whether by
purchase, merger, consolidation, or other transfer, and whether or not for
consideration.
"AFFILIATE" means any person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company. For
purposes of this definition, the term "control" means the power to direct the
management and policies of a person, directly or through one or more
intermediaries, whether through the ownership of voting securities, by contract,
or otherwise, PROVIDED, that, a Beneficial Owner of 10% or more of the total
voting power normally entitled to vote in the election of directors, managers or
trustees, as applicable, shall for such purposes be deemed to constitute
control.
"AFFILIATE TRANSACTION" shall have the meaning specified in Section
4.10.
"AGENT" means any authenticating agent, Registrar, Paying Agent or
transfer agent.
"ASSET SALE" shall have the meaning specified in Section 4.14.
1
"ASSET SALE DATE" shall have the meaning specified in Section 4.14.
"ASSET SALE OFFER" shall have the meaning specified in Section 4.14.
"ASSET SALE OFFER AMOUNT" shall have the meaning specified in Section
4.14.
"ASSET SALE OFFER PERIOD" shall have the meaning specified in Section
4.14.
"ASSET SALE OFFER PRICE" shall have the meaning specified in Section
4.14.
"ASSET SWAP" means the execution of a definitive agreement, subject
only to regulatory approval and other customary closing conditions, that the
Company in good faith believes will be satisfied, for a substantially concurrent
purchase and sale, or exchange, of Productive Assets between the Company or any
of its Subsidiaries and another person or group of affiliated persons; provided
that any amendment to or waiver of any closing condition which individually or
in the aggregate is material to the Asset Swap shall be deemed to be a new Asset
Swap.
"AVERAGE LIFE" means, as of the date of determination, with respect to
any security or instrument, the quotient obtained by dividing (i) the sum of (a)
the product of the number of years from the date of determination to the date or
dates of each successive scheduled principal (or redemption) payment of such
security or instrument and (b) the amount of each such respective principal (or
redemption) payment by (ii) the sum of all such principal (or redemption)
payments.
"BANKRUPTCY LAW" means Title 11, U.S. Code, or any similar Federal,
state or foreign law for the relief of debtors.
"BENEFICIAL OWNER" or "BENEFICIAL OWNER" for purposes of the
definition of Change of Control has the meaning attributed to it in Rules 13d-3
and 13d-5 under the Exchange Act (as in effect on the Issue Date) whether or not
applicable, except that a "person" shall be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time.
"BOARD OF DIRECTORS" means, with respect to any person, the Board of
Directors of such person or any committee of the Board of Directors of such
person authorized, with respect to any particular matter, to exercise the power
of the Board of Directors of such person.
"BOARD RESOLUTION" means, with respect to any person, a duly adopted
resolution of the Board of
2
Directors of such or the executive committee of such Board of Directors of
such person.
"BUSINESS DAY" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in New York, New York
are authorized or obligated by law or executive order to close.
"CAPITAL STOCK" means, with respect to any corporation, any and all
shares, interests, rights to purchase (other than convertible or exchangeable
Indebtedness), warrants, options, participations or other equivalents of or
interests (however designated) in stock issued by that corporation.
"CAPITAL LEASE" means a lease, the payments on which would be
capitalized for financial reporting purposes in accordance with GAAP.
"CAPITALIZED LEASE OBLIGATIONS" means rental obligations under a lease
that are required to be capitalized for financial reporting purposes in
accordance with GAAP, and the amount of Indebtedness represented by such
obligations shall be the capitalized amount of such obligations, as determined
in accordance with GAAP.
"CASH" or "CASH" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"CASH EQUIVALENT" means (i) securities issued directly or fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) or (ii) time deposits and
certificates of deposit with, and commercial paper issued by the parent
corporation of, any domestic commercial bank of recognized standing having
capital and surplus in excess of $500.0 million and commercial paper issued by
others rated at least A-2 or the equivalent thereof by Standard & Poor's
Corporation or at least P-2 or the equivalent thereof by Moody's Investors
Service, Inc. and in each case maturing within one year after the date of
acquisition.
"CHANGE OF CONTROL" means any transaction or series of transactions in
which any of the following occurs:
(a) any merger or consolidation of the Company with or into
any person or any sale, transfer or other conveyance, whether direct or
indirect, of all or substantially all of any of the assets of the Company, on a
consolidated basis, in one transaction or a series of related transactions, if,
immediately after giving effect to such transaction(s), any "person" or "group"
(as such terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
Act, whether or not applicable) (other than an Excluded Person) is or becomes
the "beneficial owner," directly or indirectly, of more than 50% of the
3
total voting power in the aggregate normally entitled to vote in election of
directors, managers, or trustees, as applicable, of the transferee(s) or
surviving entity or entities,
(b) any "person" or "group" (as such terms are used for
purposes of Sections 13(d) and 14(d) of the Exchange Act, whether or not
applicable) (other than an Excluded Person) is or becomes the "beneficial
owner," directly or indirectly, of more than 50% of the total voting power in
the aggregate of all classes of Capital Stock of the Company then outstanding
normally entitled to vote in elections of directors, or
(c) during any period of 12 consecutive months after the Issue
Date, individuals who at the beginning of any such 12-month period constituted
the Board of Directors of the Company (together with any new directors whose
election by such Board or whose nomination for election by the shareholders of
the Company was approved by a vote of a majority of the directors then still in
office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of the Company then in
office.
"CHANGE OF CONTROL OFFER" shall have the meaning specified in Section
11.1.
"CHANGE OF CONTROL OFFER PERIOD" shall have the meaning specified in
Section 11.1.
"CHANGE OF CONTROL PURCHASE DATE" shall have the meaning specified in
Section 11.1.
"CHANGE OF CONTROL PURCHASE PRICE" shall have the meaning specified in
Section 11.1.
"CHANGE OF CONTROL PUT DATE" shall have the meaning specified in
Section 11.1.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMISSION" means the SEC.
"COMMON STOCK OFFERING" means the offering by the Parent Guarantor of
its Common Stock par value $.01, on February 9, 1998.
"COMPANY" means the party named as the "Company" in the first
paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise
4
apply to any subsequent such successor or successors.
"CONSOLIDATED" or "CONSOLIDATED" means determined on a consolidated
basis in accordance with GAAP.
"CONSOLIDATED EBITDA" means, with respect to any person, for any
period, the Consolidated Net Income of such person for such period adjusted to
add thereto (to the extent deducted from net revenues in determining
Consolidated Net Income), without duplication, the sum of (i) Consolidated
income tax expense, (ii) Consolidated depreciation and amortization expense,
provided that consolidated depreciation and amortization of a Subsidiary that is
a less than wholly owned Subsidiary shall only be added to the extent of the
equity interest of the Company in such Subsidiary, (iii) other noncash charges
(including amortization of goodwill and other intangibles), (iv) Consolidated
Fixed Charges, and less the amount of all cash payments made by such person or
any of its Subsidiaries during such period to the extent such payments relate to
non-cash charges that were added back in determining Consolidated EBITDA for
such period or any prior period.
"CONSOLIDATED FIXED CHARGES" of any person means, for any period, the
aggregate amount (without duplication and determined in each case in accordance
with GAAP) of (a) interest expensed or capitalized, paid, accrued, or scheduled
to be paid or accrued (including, in accordance with the following sentence,
interest attributable to Capitalized Lease Obligations) of such person and its
Consolidated Subsidiaries during such period, including (i) original issue
discount and non-cash interest payments or accruals on any Indebtedness, (ii)
the interest portion of all deferred payment obligations, and (iii) all
commissions, discounts and other fees and charges owed with respect to bankers'
acceptances and letters of credit financings and currency and Interest Swap and
Hedging Obligations, in each case to the extent attributable to such period, and
(b) the amount of dividends accrued or payable (or guaranteed) by such person or
any of its Consolidated Subsidiaries in respect of Preferred Stock (other than
by Subsidiaries of such person to such person or such person's wholly owned
Subsidiaries). For purposes of this definition, (x) interest on a Capitalized
Lease Obligation shall be deemed to accrue at an interest rate reasonably
determined by the Company to be the rate of interest implicit in such
Capitalized Lease Obligation in accordance with GAAP and (y) interest expense
attributable to any Indebtedness represented by the guaranty by such person or a
Subsidiary of such person of an obligation of another person shall be deemed to
be the interest expense attributable to the Indebtedness guaranteed.
"CONSOLIDATED NET INCOME" means, with respect to any person for any
period, the net income (or loss) of such person and its Consolidated
Subsidiaries (determined on a consolidated basis in accordance with GAAP) for
such period, adjusted to exclude (only to the extent included in computing such
net income (or loss) and without duplication): (a) all gains or losses which are
either noncash or extraordinary (as determined in accordance with GAAP) or are
either unusual or nonrecurring (including any gain from the sale or other
5
disposition of assets outside the ordinary course of business or from the
issuance or sale of any capital stock), (b) the net income, if positive, of any
person, other than a wholly owned Consolidated Subsidiary, in which such person
or any of its Consolidated Subsidiaries has an interest, except to the extent of
the amount of any dividends or distributions actually paid in cash to such
person or a wholly owned Consolidated Subsidiary of such person during such
period, but in any case not in excess of such person's PRO RATA share of such
person's net income for such period, (c) the net income or loss of any person
acquired in a pooling of interests transaction for any period prior to the date
of such acquisition, (d) the net income, if positive, of any of such person's
Consolidated Subsidiaries to the extent that the declaration or payment of
dividends or similar distributions is not at the time permitted by operation of
the terms of its charter or bylaws or any other agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to such
Consolidated Subsidiary.
"CONSOLIDATED SUBSIDIARY" means, for any person, each Subsidiary of
such person (whether now existing or hereafter created or acquired) the
financial statements of which are consolidated for financial statement reporting
purposes with the financial statements of such person in accordance with GAAP.
"COVENANT DEFEASANCE" shall have the meaning specified in Section 8.3.
"CREDIT FACILITY" means the Credit Agreement dated as of June 12,
1996, as amended and restated as of February 14, 1996, and as further amended
and restated as of September 16, 1997, by and among The Chase Manhattan Bank (as
successor by Merger to Chemical Bank), as Administrative Agent, Banque Paribas,
as Documentation Agent, and Bank of America, Illinois, as Syndication Agent,
certain financial institutions from time to time party thereto, including any
related notes, guarantees, collateral documents, instruments, letters of credit,
reimbursement obligations and other agreements executed by or binding on the
Company, any of its Subsidiaries and/or the Parent Guarantor (or any successors
or assigns) in connection therewith (collectively, the "Related Documents"), as
such Credit Agreement and/or Related Documents may be amended, restated,
supplemented, renewed, replaced or otherwise modified from time to time whether
or not with the same agent, trustee, representative lenders or holders, and,
subject to the proviso to the next succeeding sentence, irrespective of any
changes in the terms and conditions thereof. Without limiting the generality of
the foregoing, the term "Credit Facility" shall include agreements in respect of
Interest Swap and Hedging Obligations with lenders (or affiliates thereof) party
to the Credit Facility and shall also include any amendment, amendment and
restatement, renewal, extension, restructuring, supplement or modification in
whole or in part to any Credit Facility and all refundings, refinancings and
replacements in whole or in part of any Credit Facility, including, without
limitation, any agreement or agreements (i) extending the maturity of any
Indebtedness incurred thereunder or contemplated thereby, (ii) adding or
deleting borrowers or guarantors thereunder, (iii) increasing the amount of
Indebtedness incurred thereunder or
6
available to be borrowed thereunder, provided that on the date such
Indebtedness is incurred it would be permitted by paragraph (f) under the
definition of Permitted Indebtedness, or (iv) otherwise altering the terms
and conditions thereof.
"CUSTODIAN" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"DEFAULT" means any event or condition that is, or after notice or
passage of time or both would be, an Event of Default.
"DEFAULTED INTEREST" shall have the meaning specified in Section 2.12.
"DEFINITIVE SECURITIES" means Securities that are in the form of
Security attached hereto as Exhibit A that does not include the paragraph and
schedule referred to in footnotes 1 and 2, respectively.
"DEPOSITARY" means, with respect to the Securities issuable or issued
in whole or in part in global form, the person specified in Section 2.3 as the
Depositary with respect to the Securities, until a successor shall have been
appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depositary" shall mean or include such successor.
"DISQUALIFIED CAPITAL STOCK" means (a) except as set forth in (b),
with respect to any person, Equity Interests of such person that, by its terms
or by the terms of any security into which it is convertible, exercisable or
exchangeable, is, or upon the happening of an event or the passage of time would
be, required to be redeemed or repurchased (including at the option of the
holder thereof) by such person or any of its Subsidiaries, in whole or in part,
on or prior to the Stated Maturity of the Securities, and (b) with respect to
any Subsidiary of such person (including with respect to any Subsidiary of the
Company), any Equity Interests other than any common equity with no preference,
privileges, or redemption or repayment provisions.
"DTC" shall have the meaning specified in Section 2.3.
"8 3/4% NOTES" means the 8 3/4% Senior Subordinated Notes due June 15,
2007 issued by the Company pursuant to an Indenture, dated as of June 11, 1997,
by and among Jacor Communications Company, Jacor Communications, Inc., as Parent
Guarantor, the Subsidiary Guarantors named therein and The Bank of New York, as
Trustee.
"EQUITY INTEREST" of any person means any shares, interests,
participations or other equivalents (however designated) in such person's
equity, and shall in any event include any Capital Stock issued by, or
partnership interests in, such person.
7
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute.
"EVENT OF DEFAULT" shall have the meaning specified in Section 6.1.
"EVENT OF LOSS" means, with respect to any property or asset, any (i)
loss, destruction or damage of such property or asset or (ii) any condemnation,
seizure or taking, by exercise of the power of eminent domain or otherwise, of
such property or asset, or confiscation or requisition of the use of such
property or asset.
"EXCESS PROCEEDS" shall have the meaning specified in Section 4.14.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated by the SEC thereunder.
"EXCLUDED PERSON" means Zell/Chilmark Fund L.P. and all Related
Persons of such person.
"EXEMPTED AFFILIATE TRANSACTION" means (a) customary employee
compensation arrangements approved by a majority of independent (as to such
transactions) members of the Board of Directors of the Company, (b) dividends
permitted under Section 4.3 of this Indenture payable, in form and amount, on a
PRO RATA basis to all holders of Common Stock of the Parent Guarantor, (c)
transactions solely between the Company and any of its Wholly owned Subsidiaries
or solely among Wholly owned Subsidiaries of the Company, and (d) payments to
Zell/Chilmark Fund L.P or its Affiliates for reasonable and customary fees and
expenses for financial advisory and investment banking services provided to the
Parent Guarantor and the Company, and (e) payments to the Parent Guarantor made
in accordance with the Tax Sharing Agreement.
"EXISTING ASSETS" means assets of the Company existing at the Issue
Date (other than cash, Cash Equivalents or inventory held for resale in the
ordinary course of business) and including proceeds of any sale of such assets
and assets acquired in whole or in part with proceeds from the sale from any
such assets.
"EXISTING INDEBTEDNESS" means, with respect to the Company,
Indebtedness existing or outstanding at the Issue Date.
"FAIR MARKET VALUE" or "FAIR MARKET VALUE" means, with respect to any
assets or properties, the amount at which such assets or properties would change
hands between a willing buyer and a willing seller, within a commercially
reasonable time, each having reasonable knowledge of the relevant facts, neither
being under a compulsion to sell or buy, as such amount is determined by (i) the
Board of Directors of either of the Company acting
8
in good faith or (ii) an appraisal or valuation firm of national or regional
standing selected by the Company, with experience in the appraisal or
valuation of properties or assets of the type for which Fair Market Value is
being determined.
"FINAL PUT DATE" shall have the meaning specified in Section 4.14.
"FUTURE SUBSIDIARY GUARANTOR" shall have the meaning specified in
Section 12.3.
"GAAP" means United States 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 approved by a significant segment of the
accounting profession as in effect on the Issue Date unless otherwise specified.
"GLOBAL SECURITY" means a Security that contains the paragraph and
schedule referred to in footnotes 1 and 2, respectively, in the form of Security
attached hereto as Exhibit A.
"GUARANTOR" means (i) the Parent Guarantor identified in the following
sentence and (ii) any Subsidiary Guarantors that are or become Guarantors
pursuant to the terms of this Indenture, but excluding any Persons whose
guarantees have been released pursuant to the terms of this Indenture. The
Parent Guarantor is Jacor Communications, Inc., a Delaware corporation.
"GUARANTY" shall have the meaning provided in Section 12.1.
"HOLDER" or "SECURITYHOLDER" means the person in whose name a Security
is registered on the Registrar's books.
"INCUR" or "INCUR" shall have the meaning specified in Section 4.11.
"INCURRENCE DATE" shall have the meaning specified in Section 4.11.
"INDEBTEDNESS" of any person means, without duplication, (a) all
liabilities and obligations, contingent or otherwise, of such any person, (i) in
respect of borrowed money (whether or not the recourse of the lender is to the
whole of the assets of such person or only to a portion thereof), (ii) evidenced
by bonds, notes, debentures or similar instruments, (iii) representing the
balance deferred and unpaid of the purchase price of any property or services,
except those incurred in the ordinary course of its business that would
constitute ordinarily a trade payable to trade creditors, (iv) evidenced by
bankers' acceptances or similar
9
instruments issued or accepted by banks, (v) relating to any Capitalized
Lease Obligation, or (vi) evidenced by a letter of credit or a reimbursement
obligation of such person with respect to any letter of credit; (b) all net
obligations of such person under Interest Swap and Hedging Obligations; (c)
all liabilities and obligations of others of the kind described in the
preceding clause (a) or (b) that such person has guaranteed or that is
otherwise its legal liability or which are secured by any assets or property
of such person and all obligations to purchase, redeem or acquire any Equity
Interests; and (d) all Disqualified Capital Stock of such person (valued at
the greater of its voluntary or involuntary maximum fixed repurchase price
plus accrued and unpaid dividends). For purposes hereof, the "maximum fixed
repurchase price" of any Disqualified Capital Stock which does not have a
fixed repurchase price shall be calculated in accordance with the terms of
such Disqualified Capital Stock as if such Disqualified Capital Stock were
purchased on any date on which Indebtedness shall be required to be
determined pursuant to this Indenture, and if such price is based upon, or
measured by, the Fair Market Value of such Disqualified Capital Stock, such
Fair Market Value to be determined in good faith by the board of directors of
the issuer (or managing general partner of the issuer) of such Disqualified
Capital Stock.
"INDENTURE" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"INTEREST PAYMENT DATE" means the stated due date of an installment of
interest on the Securities.
"INTEREST SWAP AND HEDGING OBLIGATION" means any obligation of any
person pursuant to any interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate exchange agreement,
currency exchange agreement or any other agreement or arrangement designed to
protect against fluctuations in interest rates or currency values, including,
without limitation, any arrangement whereby, directly or indirectly, such person
is entitled to receive from time to time periodic payments calculated by
applying either a fixed or floating rate of interest on a stated notional amount
in exchange for periodic payments made by such person calculated by applying a
fixed or floating rate of interest on the same notional amount.
"INVESTMENT" by any person in any other person means (without
duplication) (a) the acquisition (whether by purchase, merger, consolidation or
otherwise) by such person (whether for cash, property, services, securities or
otherwise) of capital stock, bonds, notes, debentures, partnership or other
ownership interests or other securities, including any options or warrants, of
such other person or any agreement to make any such acquisition; (b) the making
by such person of any deposit with, or advance, loan or other extension of
credit to, such other person (including the purchase of property from another
person subject to an understanding or agreement, contingent or otherwise, to
resell such property to such other person) or any commitment to make any such
advance, loan or extension (but excluding
10
accounts receivable or deposits arising in the ordinary course of business);
(c) other than guarantees of Indebtedness of the Company or any Guarantors to
the extent permitted by the covenant "Limitation on Incurrence of Additional
Indebtedness and Disqualified Capital Stock" or the definition of Permitted
Indebtedness, the entering into by such person of any guarantee of, or other
credit support or contingent obligation with respect to, Indebtedness or
other liability of such other person (other than the endorsement of
instruments for deposit or collection in the ordinary course of business);
and (d) the making of any capital contribution by such person to such other
person.
"ISSUE DATE" means the date of first issuance of the Securities under
this Indenture.
"JACOR" means Jacor Communications, Inc., a Delaware corporation.
"JUNIOR SECURITY" means any Qualified Capital Stock and any
Indebtedness of the Company or a Guarantor, as applicable, that is subordinated
in right of payment to Senior Debt at least to the same extent as the Securities
or the Guarantees, as applicable, and has no scheduled installment of principal
due, by redemption, sinking fund payment or otherwise, on or prior to the Stated
Maturity of the Securities; provided, that in the case of subordination in
respect of Senior Debt under the Credit Facility, "Junior Security" shall mean
any Qualified Capital Stock and any Indebtedness of the Company or the
Guarantors, as applicable, that (i) has a final maturity date occurring after
the final maturity date of, all Senior Debt outstanding under the Credit
Facility on the date of issuance of such Qualified Capital Stock or
Indebtedness, (ii) is unsecured, (iii) has an Average Life longer than the
security for which such Qualified Capital Stock or Indebtedness is being
exchanged and (iv) by their terms or by law are subordinated to Senior Debt
outstanding under the Credit Facility on the date of issuance of such Qualified
Capital Stock or Indebtedness at least to the same extent as the Securities.
"LEGAL DEFEASANCE" shall have the meaning specified in Section 8.2.
"LEVERAGE RATIO" of any person on any date of determination (the
"Transaction Date") means the ratio, on a PRO FORMA basis, of (a) the sum of the
aggregate outstanding amount of Indebtedness and Disqualified Capital Stock of
such person and its Subsidiaries as of the date of calculation on a consolidated
basis in accordance with GAAP to (b) the aggregate amount of Consolidated EBITDA
of such person attributable to continuing operations and business (exclusive of
amounts attributable to operations and businesses permanently discontinued or
disposed of) for the Reference Period; PROVIDED, that for purposes of such
calculation, (i) Acquisitions which occurred during the Reference Period or
subsequent to the Reference Period and on or prior to the Transaction Date shall
be assumed to have occurred on the first day of the Reference Period, (ii)
transactions giving rise to the need to calculate the Leverage Ratio shall be
assumed to have occurred on the first
11
day of the Reference Period, (iii) the incurrence of any Indebtedness or
issuance of any Disqualified Capital Stock during the Reference Period or
subsequent to the Reference Period and on or prior to the Transaction Date
(and the application of the proceeds therefrom to the extent used to
refinance or retire other Indebtedness) shall be assumed to have occurred on
the first day of such Reference Period and (iv) the Consolidated Fixed
Charges of such person attributable to interest on any Indebtedness or
dividends on any Disqualified Capital Stock bearing a floating interest (or
dividend) rate shall be computed on a PRO FORMA basis as if the average rate
in effect from the beginning of the Reference Period to the Transaction Date
had been the applicable rate for the entire period, unless such person or any
of its Subsidiaries is a party to an Interest Swap or Hedging Obligation
(which shall remain in effect for the 12-month period immediately following
the Transaction Date) that has the effect of fixing the interest rate on the
date of computation, in which case such rate (whether higher or lower) shall
be used.
"LIEN" means any mortgage, charge, pledge, lien (statutory or
otherwise), privilege, security interest, or other encumbrance upon or with
respect to any property of any kind, real or personal, movable or immovable, now
owned or hereafter acquired.
LYONS OFFERING" means the offering of Liquid-TM- Yield Option Notes
due 2018 by the Parent Guarantor pursuant to an Indenture, dated as of February
9, 1998, by and between Jacor Communications, Inc. and the Bank of New York, as
trustee.
"MATURITY DATE" means, when used with respect to the Securities, the
date specified on such Security as the fixed date on which the final installment
of principal of such Security is due and payable (in the absence of any
acceleration thereof pursuant to the provisions of this Indenture regarding
acceleration of Indebtedness or any Change of Control Offer or Asset Sale
Offer).
"NET CASH PROCEEDS" means the aggregate amount of cash or Cash
Equivalents received by the Company in the case of a sale of Qualified Capital
Stock and by the Company and its Subsidiaries in respect of an Asset Sale or an
Event of Loss plus, in the case of an issuance of Qualified Capital Stock of the
Company upon any exercise, exchange or conversion of securities (including
options, warrants, rights and convertible or exchangeable debt) of the Company
that were issued for cash on or after the Issue Date, the amount of cash
originally received by the Company upon the issuance of such securities
(including options, warrants, rights and convertible or exchangeable debt) less,
in each case, the sum of all payments, fees, commissions and (in the case of
Asset Sales, reasonable and customary), expenses (including, without limitation,
the fees and expenses of legal counsel and investment banking fees and expenses)
incurred in connection with such Asset Sale, Event of Loss or sale of Qualified
Capital Stock, and, in the case of an Asset Sale only, less an amount (estimated
reasonably and in good faith by the Company or the amount actually incurred, if
greater) of income, franchise, sales and other applicable taxes required to be
paid
12
by the Company or any of its Subsidiaries in connection with such Asset Sale.
"9 3/4% NOTES" means the 9 3/4% Senior Subordinated Notes due December
15, 2006 issued by the Company pursuant to an Indenture, dated as of December
17, 1996, by and among Jacor Communications Company, Jacor Communications, Inc.,
as Parent Guarantor, the Subsidiary Guarantors named therein and The Bank of New
York, as Trustee.
"NON-GUARANTOR SUBSIDIARY" means any Subsidiary that is not a
Guarantor.
"NOTICE OF DEFAULT" shall have the meaning specified in Section
6.1(3).
"OBLIGATION" means any principal, premium or interest payment, or
monetary penalty, or damages, due by the Company or any Guarantor under the
terms of the Securities or the Indenture.
"OFFICER" means, with respect to the Company or the Guarantors, the
Chief Executive Officer, the President, any Senior Vice President, the Chief
Financial Officer, the Treasurer, the Controller, or the Secretary of the
Company or Guarantor (as applicable).
"OFFICERS' CERTIFICATE" means, with respect to the Company or the
Guarantors, a certificate signed by two Officers or by an Officer and an
Assistant Secretary of the Company or the Guarantors (as applicable) and
otherwise complying with the requirements of Sections 13.4 and 13.5, and
delivered to the Trustee or an Agent, as applicable.
"OPINION OF COUNSEL" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee (which may include counsel to the Trustee
or the Company including an employee of the Company) or an Agent, as applicable,
complying with the requirements of Sections 13.4 and 13.5, and delivered to the
Trustee or an Agent, as applicable.
"OUTSTANDING" as used with reference to the Securities shall have the
meaning specified in Section 2.8 hereof.
"PARENT" or "PARENT" of any person means a corporation which at the
date of determination owns, directly or indirectly, a majority of the Voting
Stock of such person or of a Parent of such person.
"PARENT GUARANTOR" means Jacor Communications, Inc., a Delaware
corporation.
"PAYING AGENT" has the meaning specified in Section 2.3.
13
"PAYMENT DEFAULT" has the meaning specified in Section 10.2.
"PAYMENT NOTICE" shall have the meaning set out in Section 10.2.
"PERMITTED INDEBTEDNESS" means any of the following:
(a) the Company and its Subsidiaries may incur Indebtedness
solely in respect of bankers acceptances, letters of credit and performance
bonds (to the extent that such incurrence does not result in the incurrence of
any obligation to repay any obligation relating to borrowed money of others),
all in the ordinary course of business in accordance with customary industry
practices, in amounts and for the purposes customary in the Company's industry;
provided, that the aggregate principal amount outstanding of such Indebtedness
(including any Indebtedness issued to refinance, refund or replace such
Indebtedness) shall at no time exceed $25.0 million;
(b) the Company may incur Indebtedness to any Wholly owned
Subsidiary Guarantor, and any Wholly owned Subsidiary Guarantor may incur
Indebtedness to any other Wholly owned Subsidiary Guarantor or to the Company;
provided, that in the case of Indebtedness of the Company, such obligations
shall be unsecured and subordinated in all respects to the Company's obligations
pursuant to the Securities and the date of any event that causes such Subsidiary
Guarantor to no longer be a Wholly owned Subsidiary shall be an Incurrence Date;
(c) the Company and the Guarantors may incur Indebtedness
evidenced by the Securities and the Guarantees and represented by this Indenture
up to the amounts specified therein as of the date hereof;
(d) the Company and the Guarantors, as applicable, may incur
Refinancing Indebtedness with respect to any Indebtedness or Disqualified
Capital Stock, as applicable, which Indebtedness was incurred pursuant to the
Leverage Ratio in Section 4.11 hereof or clause (c) of this definition;
(e) the Company and its Subsidiaries may incur Indebtedness in
an aggregate amount outstanding at any time (including any Indebtedness issued
to refinance, replace, or refund such Indebtedness) of up to $10.0 million;
(f) the Company and the Guarantors may incur Indebtedness
incurred pursuant to the Credit Facility up to an aggregate principal amount
outstanding (including any Indebtedness issued to refinance, refund or replace
such Indebtedness in whole or in part) at any time of $1.15 billion, plus
accrued interest and additional expense and reimbursement obligations with
respect thereto and such additional amounts as may be deemed to be outstanding
in the form of Interest Swap and Hedging Obligations with lenders
14
(or affiliates thereof) party to the Credit Facility, minus the amount of any
such Indebtedness retired with Net Cash Proceeds from any Asset Sale;
(g) the Company and the Guarantors may incur Indebtedness
under Interest Swap and Hedging Obligations that do not increase the
Indebtedness of the Company other than as a result of fluctuations in interest
or foreign currency exchange rates provided that such Interest Swap and Hedging
Obligations are incurred for the purpose of providing interest rate protection
with respect to Indebtedness permitted under this Indenture or to provide
currency exchange protection in connection with revenues generated in currencies
other than U.S. dollars;
(h) Subsidiaries may incur Acquired Indebtedness if the
Company at the time of such incurrence could incur such Indebtedness pursuant to
the Leverage Ratio in Section 4.11; and
(i) the Company and its Subsidiaries may incur Indebtedness
existing on the Issue Date.
"PERMITTED INVESTMENT" means:
(a) Investments in any of the Securities, the 10 1/8% Notes,
the 9 3/4% Notes and the 8 3/4% Notes;
(b) Cash Equivalents;
(c) intercompany loans to the extent permitted under clause
(b) of the definition of "Permitted Indebtedness" and intercompany security
agreements relating thereto;
(d) loans, advances or investments in existence on the Issue
Date;
(e) Investments in a person substantially all of whose assets
are of a type generally used in a Related Business (an "Acquired Person") if, as
a result of such Investments, (i) the Acquired Person immediately thereupon is
or becomes a Subsidiary of the Company, or (ii) the Acquired Person immediately
thereupon either (1) is merged or consolidated with or into the Company or any
of its Subsidiaries and the surviving person is the Company or a Subsidiary of
the Company or (2) transfers or conveys all or substantially all of its assets,
or is liquidated into, the Company or any of its Subsidiaries;
(f) Investments in a person with whom the Company or any of
its Subsidiaries have entered into, (i) local marketing agreements or time
brokerage agreements pursuant to which the Company or any one of its
Subsidiaries will program substantial
15
portions of the broadcast day on such person's radio broadcast station(s) and
will sell advertising time during such program segments for its own account
provided, that, the Company or a Subsidiary must commence such programming
within 60 days of entering into such agreement or (ii) joint sales agreements
pursuant to which the Company or any of its Subsidiaries will sell
substantially all of the advertising time for such person's radio broadcast
station(s) provided, that, the Company or a Subsidiary must commence such
programing within 60 days of entering into such agreement;
(g) Investments that are in persons which will have the
purpose of furthering the operations of the Company and its Subsidiaries not to
exceed $25.0 million; and
(h) demand deposit accounts maintained in the ordinary course
of business.
"PERMITTED LIEN" means:
(a) Liens existing on the Issue Date;
(b) Liens imposed by governmental authorities for taxes,
assessments or other charges or levies not yet subject to penalty or which are
being contested in good faith and by appropriate proceedings, if adequate
reserves with respect thereto are maintained on the books of the Company in
accordance with GAAP as of the date of determination;
(c) statutory liens of carriers, warehousemen, mechanics,
materialmen, landlords, repairmen or other like Liens arising by operation of
law in the ordinary course of business provided that (i) the underlying
obligations are not overdue for a period of more than 60 days, or (ii) such
Liens are being contested in good faith and by appropriate proceedings and
adequate reserves with respect thereto are maintained on the books of the
Company in accordance with GAAP as of the date of determination;
(d) Liens securing the performance of bids, trade contracts
(other than borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the
ordinary course of business and deposits made in the ordinary course of business
to secure obligations of public utilities;
(e) easements, rights-of-way, zoning, building restrictions,
reservations, encroachments, exceptions, covenants, similar restrictions and
other similar encumbrances or title defects which, singly or in the aggregate,
do not in any case materially detract from the value of the property, subject
thereto (as such property is used by the Company or any of its Subsidiaries) or
interfere with the ordinary conduct of the business
16
of the Company or any of its Subsidiaries;
(f) Liens arising by operation of law in connection with
judgments, provided, that the execution or other enforcement of such Liens is
effectively stayed and that the claims secured thereby are being contested in
good faith by appropriate proceedings;
(g) pledges or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance and
other types of social security legislation;
(h) Liens securing Indebtedness of a person existing at the
time such person becomes a Subsidiary or is merged with or into the Company or a
Subsidiary or Liens securing Indebtedness incurred in connection with an
Acquisition, provided that such Liens were in existence prior to the date of
such acquisition, merger or consolidation, were not incurred in anticipation
thereof, and do not extend to any other assets;
(i) leases or subleases granted to other persons in the
ordinary course of business not materially interfering with the conduct of the
business of the Company or any of its Subsidiaries or materially detracting from
the value of the relative assets of the Company or any of its Subsidiaries;
(j) Liens arising from precautionary Uniform Commercial Code
financing statement filings regarding operating leases entered into by the
Company or any of its Subsidiaries in the ordinary course of business;
(k) Liens securing Refinancing Indebtedness incurred to
refinance any Indebtedness that was previously so secured in a manner no more
adverse to the Holders of the Securities than the terms of the Liens securing
such refinanced Indebtedness provided that the Indebtedness secured is not
increased and the lien is not extended to any additional assets or property;
(l) Liens in favor of the Administrative Agent pursuant to the
Credit Facility; and
(m) Liens on property of a Subsidiary of the Company provided
that such Liens secure only obligations owing by such Subsidiary to the Company
or another Subsidiary of the Company.
"PERSON" or "PERSON" means any corporation, individual, limited
liability company, joint stock company, joint venture, partnership,
unincorporated association, governmental regulatory entity, country, state or
political subdivision thereof, trust, municipality or other entity.
17
"PLAN OF LIQUIDATION" means a plan that provides for, contemplates or
the effectuation of which is preceded or accompanied by (whether or not
substantially contemporaneously) (i) the sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company otherwise
than as an entirety or substantially as an entirety and (ii) the distribution
of all or substantially all of the proceeds of such sale, lease, conveyance or
other disposition and all or substantially all of the remaining assets of the
Company to holders of Capital Stock of the Company.
"PREFERRED STOCK" as applied to the Capital Stock of any corporation,
means Capital Stock ranking prior to the shares of any other class of Capital
Stock of said corporation as to the payment of dividends or the distribution of
assets on any voluntary or involuntary liquidation.
"PRESENT SUBSIDIARY GUARANTORS" means Broadcast Finance, Inc.; Cine
Films, Inc.; Cine Guarantors, Inc.; Cine Guarantors II, Inc.; Cine Guarantors
II, Ltd.; Cine Mobile Systems Int'l. N.V.; Cine Movil S.A. de C.V.; Citicasters
Co.; GACC-N26LB, Inc.; Great American Merchandising Group, Inc.; Great American
Television Productions, Inc.; Inmobilaria Radial, S.A. de C.V.; Jacor
Broadcasting Corporation; Jacor Broadcasting of Atlanta, Inc.; Jacor
Broadcasting of Charleston, Inc.; Jacor Broadcasting of Colorado, Inc.; Jacor
Broadcasting of Florida, Inc.; Jacor Broadcasting of Denver, Inc.; Jacor
Broadcasting of Kansas City, Inc.; Jacor Broadcasting of Las Vegas, Inc.; Jacor
Broadcasting of Las Vegas II; Jacor Broadcasting of Louisville, Inc.; Jacor
Broadcasting of Louisville II, Inc.; Jacor Broadcasting of Salt Lake City, Inc.;
Jacor Broadcasting of Salt Lake City II, Inc.; Jacor Broadcasting of St. Louis,
Inc.; Jacor Broadcasting of San Diego, Inc.; Jacor Broadcasting of Sarasota,
Inc.; Jacor Broadcasting of Tampa Bay, Inc.; Jacor Broadcasting of Toledo, Inc.;
Jacor Broadcasting of Youngstown, Inc.; Jacor Cable, Inc., Jacor Licensee of
Charleston, Inc.; Jacor Licensee of Kansas City, Inc., Jacor Licensee of Las
Vegas, Inc.; Jacor Licensee of Las Vegas II, Inc.; Jacor Licensee of Louisville,
Inc.; Jacor Licensee of Louisville II, Inc.; Jacor Licensee of Salt Lake City,
Inc.; Jacor Licensee of Salt Lake City II, Inc.; Jacor/Premiere Holding, Inc.;
JBSL, Inc.; Location Productions, Inc.; Location Productions II, Inc.;
Multiverse Acquisition Corp.; Noble Broadcast Center, Inc.; Noble Broadcast
Group, Inc.; Noble Broadcast Holdings, Inc.; Noble Broadcast Licenses, Inc.;
Noble Broadcast of San Diego, Inc.; Nobro, S.C.; Nova Marketing Group, Inc.; NSN
Network Services, Ltd.; Premiere Radio Networks, Inc.; Radio-Active Media, Inc.;
Sports Radio Broadcasting, Inc.; Sports Radio, Inc.; The Sy Fischer Company
Agency, Inc.;VTTV Productions; and WHOK, Inc. each a direct or indirect
subsidiary of the Company or any successor entity, whether by merger,
consolidation, change of name or otherwise.
"PRO RATA PORTION" shall have the meaning specified in Section 12.1.
"PRODUCTIVE ASSETS" means assets of a kind used or usable by the
Company and its Subsidiaries in a Related Business.
18
"PROPERTY" means any right or interest in or to property or assets of
any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"PUBLIC OFFERING" means a firm commitment underwritten primary
offering of Capital Stock of the Parent Guarantor or the Company.
"QUALIFIED CAPITAL STOCK" means any Capital Stock of the Company that
is not Disqualified Capital Stock.
"QUALIFIED EXCHANGE" means any legal defeasance, redemption,
retirement, repurchase or other acquisition of Capital Stock or Indebtedness of
the Company issued on or after the Issue Date with the Net Cash Proceeds
received by the Company from the substantially concurrent sale of Qualified
Capital Stock or any exchange of Qualified Capital Stock for any Capital Stock
or Indebtedness issued on or after the Issue Date.
"RECORD DATE" means a Record Date specified in the Securities whether
or not such Record Date is a Business Day.
"REDEMPTION DATE," when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to Article III of
this Indenture and Paragraph 5 in the form of Security.
"REDEMPTION PRICE," when used with respect to any Security to be
redeemed, means the redemption price for such redemption pursuant to Paragraph 5
in the form of Security, which shall include, without duplication, in each case,
accrued and unpaid interest to the Redemption Date (subject to the provisions of
Section 3.5).
"REFERENCE PERIOD" with regard to any Person means the four full
fiscal quarters (or such lesser period during which such person has been in
existence) ended immediately preceding any date upon which any determination is
to be made pursuant to the terms of the Securities or this Indenture.
"REFINANCING INDEBTEDNESS" means Indebtedness or Disqualified Capital
Stock (a) issued in exchange for, or the proceeds from the issuance and sale of
which are used substantially concurrently to repay, redeem, defease, refund,
refinance, discharge or otherwise retire for value, in whole or in part, or (b)
constituting an amendment, modification or supplement to, or a deferral or
renewal of ((a) and (b) above are, collectively, a "Refinancing"), any
Indebtedness or Disqualified Capital Stock in a principal amount or, in the case
of Disqualified Capital Stock, liquidation preference, not to exceed (after
deduction of reasonable and customary fees and expenses incurred in connection
with the Refinancing) the lesser of (i) the principal amount or, in the case of
Disqualified Capital Stock, liquidation preference, of the Indebtedness or
Disqualified Capital Stock so Refinanced and (ii) if such
19
Indebtedness being Refinanced was issued with an original issue discount, the
accredited value thereof (as determined in accordance with GAAP) at the time
of such Refinancing; provided, that (A) such Refinancing Indebtedness of any
Subsidiary of the Company shall only be used to Refinance outstanding
Indebtedness or Disqualified Capital Stock of such Subsidiary, (B) such
Refinancing Indebtedness shall (x) not have an Average Life shorter than the
Indebtedness or Disqualified Capital Stock to be so refinanced at the time of
such Refinancing and (y) in all respects, be no less subordinated or junior,
if applicable, to the rights of Holders of the Securities than was the
Indebtedness or Disqualified Capital Stock to be refinanced and (C) such
Refinancing Indebtedness shall have no installment of principal (or
redemption payment) scheduled to come due earlier than the scheduled maturity
of any installment of principal of the Indebtedness or Disqualified Capital
Stock to be so refinanced which was scheduled to come due prior to the Stated
Maturity.
"REGISTRAR" shall have the meaning specified in Section 2.3.
"RELATED BUSINESS" means the business conducted (or proposed to be
conducted) by the Company and its Subsidiaries as of the Issue Date and any and
all businesses that in the good faith judgment of the Board of Directors of the
Company are materially related businesses.
"RELATED PERSON" means any person who controls, is controlled by or is
under common control with an Excluded Person; PROVIDED that for purposes of this
definition "control" means the beneficial ownership of more than 50% of the
total voting power of a person normally entitled to vote in the election of
directors, managers or trustees, as applicable of a person.
"REPRESENTATIVE" means Chase Manhattan Bank in its capacity as
Administrative Agent for lenders pursuant to the New Credit Facility, and not in
its individual capacity as a lender, and any successor Administrative Agent
appointed pursuant to the Credit Facility.
"REQUIRED LENDERS" means lenders under the Credit Facility whose PRO
RATA shares (as defined therein), pursuant to the Credit Facility, are in the
aggregate at least 66 2/3%.
"RESTRICTED INVESTMENT" means, in one or a series of related
transactions any Investment other than investments in Permitted Investments;
provided, however, that a merger of another person with or into the Company or a
Subsidiary Guarantor shall not be deemed to be a Restricted Investment so long
as the surviving entity is the Company or a direct Wholly owned Subsidiary
Guarantor.
"RESTRICTED PAYMENT" means with respect to any person, (a) the
declaration
20
or payment of any dividend or other distribution in respect of Equity
Interests of such person or any parent or Subsidiary of such person, (b) any
payment on account of the purchase, redemption or other acquisition or
retirement for value of Equity Interests of such person or any Subsidiary or
parent of such person, (c) other than with the proceeds from the
substantially concurrent sale of, or in exchange for, Refinancing
Indebtedness any purchase, redemption, or other acquisition or retirement for
value of, any payment in respect of any amendment of the terms of or any
defeasance of, any Subordinated Indebtedness, directly or indirectly, by such
person or a parent or Subsidiary of such person prior to the scheduled
maturity, any scheduled repayment of principal, or scheduled sinking fund
payment, as the case may be, of such Indebtedness and (d) any Restricted
Investment by such person; provided, however, that the term "Restricted
Payment" does not include (i) any dividend, distribution or other payment on
or with respect to Capital Stock of an issuer to the extent payable solely in
shares of Qualified Capital Stock of such issuer; (ii) any dividend,
distribution or other payment to the Company, or to any Wholly owned
Subsidiary Guarantor, by any of the Subsidiaries of the Company; or (iii)
loans or advances to any Guarantor the proceeds of which are used by such
Subsidiary Guarantor in a Related Business activity of such Subsidiary
Guarantor.
"SEC" means the Securities and Exchange Commission.
"SECURITIES" means the 8% Senior Subordinated Notes due 2010 issued
under this Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"SECURITIES CUSTODIAN" means the Registrar, as custodian with respect
to the Securities in global form, or any successor entity thereto.
"SECURITYHOLDER" or "HOLDER" means any person in whose name a Security
is registered on the Registrar's books.
"SENIOR DEBT" of the Company or any Guarantor means Indebtedness
(including any monetary obligation in respect of the Credit Facility, and
interest, whether or not such interest is allowed or allowable, accruing on
Indebtedness incurred pursuant to the Credit Facility at the contracted-for rate
whether accruing on, before or after the commencement of any proceeding under
any bankruptcy, insolvency or similar law) of the Company or such Guarantor
arising under the Credit Facility or that, by the terms of the instrument
creating or evidencing such Indebtedness, is expressly designated Senior Debt
and made senior in right of payment to the Securities or the applicable
Guaranty; provided, that in no event shall Senior Debt include (a) Indebtedness
to any Subsidiary of the Company or any officer, director or employee of the
Company or any Subsidiary of the Company, (b)
21
Indebtedness incurred in violation of the terms of this Indenture, (c)
Indebtedness to trade creditors, (d) Disqualified Capital Stock and (e) any
liability for taxes owed or owing by the Company or such Guarantor.
"SIGNIFICANT SUBSIDIARY" shall have the meaning provided under
Regulation S-X of the Securities Act, in effect on the Issue Date.
"SPECIAL RECORD DATE" for payment of any Defaulted Interest means a
date fixed by the Paying Agent pursuant to Section 2.12.
"STATED MATURITY," when used with respect to any Security, means
February 15, 2010.
"SUBORDINATED INDEBTEDNESS" means Indebtedness of the Company or a
Guarantor that is subordinated in right of payment to the Securities or such
Guaranty, as applicable, in any respect or has a stated maturity on or after the
Stated Maturity.
"SUBSIDIARY" with respect to any person, means (i) a corporation a
majority of whose Capital Stock with voting power, under ordinary circumstances,
to elect directors is at the time, directly or indirectly, owned by such person,
by such person and one or more Subsidiaries of such person or by one or more
Subsidiaries of such person, (ii) any other person (other than a corporation) in
which such person, one or more Subsidiaries of such person, or such person and
one or more Subsidiaries of such person, directly or indirectly, at the date of
determination thereof has at least majority ownership interest, or (iii) a
partnership in which such person or a Subsidiary of such person is, at the time,
a general partner and in which such person, directly or indirectly, at the date
of determination thereof has at least a majority ownership interest.
"SUBSIDIARY GUARANTORS" means (i) the Present Subsidiary Guarantors
and (ii) Future Subsidiary Guarantors that become Subsidiary Guarantors pursuant
to the terms of this Indenture, but excluding any Persons whose guarantees have
been released pursuant to the terms of this Indenture.
"TAX SHARING AGREEMENT" means any agreements between the Company and
the Parent Guarantor pursuant to which the Company may make payments to the
Parent Guarantor with respect to the Company's Federal, state, or local income
or franchise tax liabilities where the Company is included in a consolidated,
unitary or combined return filed by the Parent Guarantor; PROVIDED, HOWEVER,
that the payment by the Company under such agreement may not exceed the
liability of the Company for such taxes if it had filed its income tax returns
as a separate company.
"10 1/8% NOTES" means the 10 1/8% Senior Subordinated Notes due
June 15,
22
2006 issued by JCAC, Inc. (predecessor to the Company) pursuant to an Indenture,
dated as of June 12, 1996, by and among JCAC, Inc., Jacor Communications Inc.,
as Initial Guarantor, and First Trust of Illinois, National Association, as
Trustee
"TIA" means the Trust Indenture Act of 1939, as amended, (15 U.S. Code
Sections 77aaa-77bbbb) as in effect on the date of the execution of this
Indenture, except as provided in Section 9.3.
"TRANSFER INSTRUMENTS" shall have the meaning specified in Section
12.2.
"TRUSTEE" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"TRUST OFFICER" means any officer within the corporate trust
department (or any successor group) of the Trustee or any other officer of the
Trustee customarily performing functions similar to those performed by the
Persons who at that time shall be such officers, and also means, with respect to
a particular corporate trust matter, any other officer of the Trustee to whom
such trust matter is referred because of his knowledge of and familiarity with
the particular subject.
"U.S. GOVERNMENT OBLIGATIONS" means direct non-callable obligations
of, or noncallable obligations guaranteed by, the United States of America for
the payment of which obligation or guarantee the full faith and credit of the
United States of America is pledged.
"VOTING STOCK" means, with respect to any specified person, capital
stock with voting power, under ordinary circumstances, to elect directors of
such Person.
"WHOLLY OWNED SUBSIDIARY" means a Subsidiary all the Equity Interests
of which are owned by the Company or one or more Wholly owned Subsidiaries of
the Company.
SECTION 1.2. INCORPORATION BY REFERENCE OF TIA.
Whenever this Indenture refers to a provision of the TIA, such
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:
"COMMISSION" means the SEC.
"INDENTURE SECURITIES" means the Securities.
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"INDENTURE SECURITYHOLDER" means a Holder or a Securityholder.
"INDENTURE TO BE QUALIFIED" means this Indenture.
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee.
"OBLIGOR" on the indenture securities means the Company, each
Guarantor and any other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them thereby.
SECTION 1.3. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the
plural include the singular;
(5) provisions apply to successive events and transactions;
(6) "herein," "hereof" and other words of similar import refer
to this Indenture as a whole and not to any particular Article, Section or other
subdivision; and
(7) references to Sections or Articles means reference to such
Section or Article in this Indenture, unless stated otherwise.
ARTICLE II
THE SECURITIES
SECTION 2.1. FORM AND DATING.
The Securities and the Trustee's certificate of authentication, in
respect
24
thereof, shall be substantially in the form of Exhibit A hereto, which
Exhibit is part of this Indenture. The Securities may have notations,
legends or endorsements required by law, stock exchange rule or usage. The
Company shall approve the form of the Securities and any notation, legend or
endorsement on them. Any such notations, legends or endorsements not
contained in the form of Security attached as Exhibit A hereto shall be
delivered in writing to the Trustee. Each Security shall be dated the date
of its authentication.
The terms and provisions contained in the forms of Securities shall
constitute, and are hereby expressly made, a part of this Indenture and, to the
extent applicable, 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.
SECTION 2.2. EXECUTION AND AUTHENTICATION.
Two Officers shall sign, or one Officer shall sign and one Officer
shall attest to, the Security for the Company by manual or facsimile signature.
The Company's seal, if any, shall be impressed, affixed, imprinted or reproduced
on the Securities and may be in facsimile form.
If an Officer whose signature is on a Security was an Officer at the
time of such execution but no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless and the
Company shall nevertheless be bound by the terms of the Securities and this
Indenture.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security but
such signature shall be conclusive evidence that the Security has been
authenticated pursuant to the terms of this Indenture.
The Trustee shall authenticate or cause to be authenticated Securities
for original issue in the aggregate principal amount of up to $120,000,000 upon
a written order of the Company in the form of an Officers' Certificate. The
Officers' Certificate shall specify the amount of Securities to be authenticated
and the date on which the Securities are to be authenticated. The aggregate
principal amount of Securities outstanding at any time may not exceed
$120,000,000, except as provided in Section 2.7. Upon the written order of the
Company in the form of an Officers' Certificate, the Trustee shall authenticate
Securities in substitution of Securities originally issued to reflect any name
changes of the Company.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An
25
authenticating agent has the same rights as an Agent to deal with the
Company, any Affiliate of the Company, or any of its Subsidiaries.
Securities shall be issuable only in fully registered form, without
coupons, in denominations of $1,000 and integral multiples thereof.
SECTION 2.3. REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency in the Borough of
Manhattan, The City of New York, where Securities may be presented for
registration of transfer or exchange ("Registrar") and an office or agency of
the Company where Securities may be presented for payment ("Paying Agent") and
where notices and demands to or upon the Company in respect of the Securities
may be served. The Company may act as Registrar or Paying Agent, except that,
for the purposes of Articles III, VIII, XI, and Section 4.14 and as otherwise
specified in this Indenture, neither the Company nor any Affiliate of the
Company shall act as Paying Agent. The Registrar shall keep a register of the
Securities and of their transfer and exchange. The Company may have 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 hereby initially appoints the Trustee as Registrar
and Paying Agent, and by its acknowledgment and acceptance on the signature page
hereto, the Trustee hereby agrees so to act.
The Company shall enter into an appropriate written agency agreement
with any Agent (including the Paying Agent) not a party to this Indenture, which
agreement shall implement the provisions of this Indenture that relate to such
Agent, and shall furnish a copy of each such agreement to the Trustee. The
Company shall promptly notify the Trustee in writing of the name and address of
any such Agent. If the Company fails to maintain a Registrar or Paying Agent,
the Trustee shall act as such.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Securities.
The Company initially appoints the Registrar to act as Securities
Custodian with respect to the Global Securities.
Upon the occurrence of an Event of Default described in Section 6.1(4)
or (6), the Trustee shall, or upon the occurrence of any other Event of Default
by notice to the Company, the Registrar and the Paying Agent, the Trustee may,
assume the duties and obligations of the Registrar and the Paying Agent
hereunder.
26
SECTION 2.4. PAYING AGENT TO HOLD ASSETS IN TRUST.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that such Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all assets held by the Paying Agent for the payment of
principal of, premium, if any, or interest on, the Securities (whether such
assets have been distributed to it by the Company or any other obligor on the
Securities), and shall notify the Trustee in writing of any Default in making
any such payment. If a Subsidiary of the Company acts as Paying Agent, it shall
segregate such assets and hold them as a separate trust fund for the benefit of
the Holders or the Trustee. The Company at any time may require a Paying Agent
to distribute all assets held by it to the Trustee and account for any assets
disbursed and the Trustee may at any time during the continuance of any payment
Default or any Event of Default, upon written request to a Paying Agent, require
such Paying Agent to distribute all assets held by it to the Trustee and to
account for any assets distributed. Upon distribution to the Trustee of all
assets that shall have been delivered by the Company to the Paying Agent, the
Paying Agent (if other than the Company) shall have no further liability for
such assets.
SECTION 2.5. SECURITYHOLDER LISTS.
The Registrar shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders and shall otherwise comply with TIA Section 312(a). If the Trustee or
any Paying Agent is not the Registrar, the Company shall furnish to the Trustee
on or before the third Business Day preceding each Interest Payment Date and at
such other times as the Trustee or any such Paying Agent may request in writing
a list in such form and as of such date as the Trustee or any such Paying Agent
reasonably may require of the names and addresses of Holders and the Company
shall otherwise comply with TIA Section 312(a).
SECTION 2.6. TRANSFER AND EXCHANGE.
(a) TRANSFER AND EXCHANGE OF DEFINITIVE SECURITIES. When
Definitive Securities are presented to the Registrar with a request:
(x) to register the transfer of such Definitive Securities;
or
(y) to exchange such Definitive Securities for an equal
principal amount of Definitive Securities of other authorized denominations; the
Registrar shall register the transfer or make the exchange as requested if its
reasonable requirements for such transaction are met; PROVIDED, HOWEVER, that
the Definitive Securities surrendered for registration of transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in
form reasonably satisfactory to the Company and the Registrar duly
27
executed by the Holder thereof or his attorney duly authorized in writing.
(b) RESTRICTIONS ON TRANSFER OF A DEFINITIVE SECURITY FOR A
BENEFICIAL INTEREST IN A GLOBAL SECURITY. A Definitive Security may not be
exchanged for a beneficial interest in a Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the Registrar
of a Definitive Security, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Registrar, together with
written instructions of the Holder directing the Registrar to make, or to direct
the Securities Custodian to make, an endorsement on the Global Security to
reflect an increase in the aggregate principal amount of the Securities
represented by the Global Security, then the Registrar shall cancel such
Definitive Security and cause, or direct the Securities Custodian to cause, in
accordance with the standing instructions and procedures existing between the
Depositary and the Securities Custodian, the aggregate principal amount of
Securities represented by the Global Security to be increased accordingly. If
no Global Securities are then outstanding, the Company shall issue and the
Trustee shall authenticate a new Global Security in the appropriate principal
amount.
(c) TRANSFER AND EXCHANGE OF GLOBAL SECURITIES. The transfer
and exchange of Global Securities or beneficial interests therein shall be
effected through the Depositary, in accordance with this Indenture and the
procedures of the Depositary therefor.
(d) TRANSFER OF A BENEFICIAL INTEREST IN A GLOBAL SECURITY FOR
A DEFINITIVE SECURITY.
(i) Any Person having a beneficial interest in a
Global Security may upon request exchange such beneficial interest for a
Definitive Security. Upon receipt by the Registrar of written instructions
or such other form of instructions as is customary for the Depositary from
the Depositary or its nominee on behalf of any Person having a beneficial
interest in a Global Security, and, if such beneficial interest is being
transferred to the Person designated by the Depositary as being the
beneficial owner, a certification from such person to that effect (in
substantially the form set forth on the reverse of the Security)(all of
which may be submitted by facsimile), then the Registrar or the Securities
Custodian, at the direction of the Trustee, will cause, in accordance with
the standing instructions and procedures existing between the Depositary
and the Securities Custodian, the aggregate principal amount of the Global
Security to be reduced and, following such reduction, the Company will
execute and the Trustee's authenticating agent will authenticate and
deliver to the transferee a Definitive Security.
(ii) Definitive Securities issued in exchange for a
beneficial interest in a Global Security pursuant to this Section 2.6(d)
shall be registered in such names and in such authorized denominations as
the Depositary,
28
pursuant to instructions from its direct or indirect participants or
otherwise, shall instruct the Registrar. The Registrar shall deliver
such Definitive Securities to the persons in whose names such Securities
are so registered.
(e) RESTRICTIONS ON TRANSFER AND EXCHANGE OF GLOBAL
SECURITIES. Notwithstanding any other provisions of this Indenture (other than
the provisions set forth in subsection (f) of this Section 2.6), a Global
Security may not be transferred as a whole except 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.
(f) AUTHENTICATION OF DEFINITIVE SECURITIES IN ABSENCE OF
DEPOSITARY. If at any time:
(i) the Depositary for the Securities notifies the
Company that the Depositary is unwilling or unable to continue as
Depositary for the Global Securities and a successor Depositary for the
Global Securities is not appointed by the Company within 90 days after
delivery of such notice; or
(ii) the Company, in its sole discretion, notifies
the Trustee and the Registrar in writing that it elects to cause the
issuance of Definitive Securities under this Indenture,
then the Company will execute, and the Trustee, upon receipt of an Officers'
Certificate requesting the authentication and delivery of Definitive Securities,
will, or its authenticating agent will, authenticate and deliver Definitive
Securities, in an aggregate principal amount equal to the principal amount of
the Global Securities, in exchange for such Global Securities.
(g) CANCELLATION AND/OR ADJUSTMENT OF GLOBAL SECURITY. At
such time as all beneficial interests in a Global Security have either been
exchanged for Definitive Securities, redeemed, repurchased or cancelled, such
Global Security shall be returned to or retained and cancelled by the Registrar.
At any time prior to such cancellation, if any beneficial interest in a Global
Security is exchanged for Definitive Securities, redeemed, repurchased or
cancelled, the principal amount of Securities represented by such Global
Security shall be reduced and an endorsement shall be made on such Global
Security, by the Registrar or the Securities Custodian, at the direction of the
Registrar, to reflect such reduction.
(h) OBLIGATIONS WITH RESPECT TO TRANSFERS AND EXCHANGES OF
SECURITIES.
29
(i) To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee or any authenticating
agent of the Trustee shall authenticate Definitive Securities and Global
Securities at the Registrar's request.
(ii) No service charge shall be made to a Holder for
any registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any transfer tax, assessments, or
similar governmental charge payable in connection therewith (other than any
such transfer taxes, assessments, or similar governmental charge payable
upon exchanges or transfers pursuant to Section 2.10, 3.7, 4.14(8), 9.5, or
11.1 (final paragraph)).
(iii) The Registrar shall not be required to
register the transfer of or exchange (a) any Definitive Security selected
for redemption in whole or in part pursuant to Article III, except the
unredeemed portion of any Definitive Security being redeemed in part, or
(b) any Security for a period beginning 15 Business Days before the mailing
of a notice of an offer to repurchase pursuant to Article XI or Section
4.14 hereof or redemption of Securities pursuant to Article III hereof and
ending at the close of business on the day of such mailing.
SECTION 2.7. REPLACEMENT SECURITIES.
If a mutilated Security is surrendered to the Registrar or if the
Holder of a Security claims and submits an affidavit or other evidence,
satisfactory to the Registrar, to the Registrar to the effect that the Security
has been lost, destroyed or wrongfully taken, the Company shall issue and the
Trustee or any authenticating agent of the Trustee shall authenticate a
replacement Security if the Registrar's requirements are met. Such Holder must
provide an indemnity bond or other indemnity, sufficient in the judgment of both
the Company and the Registrar, to protect the Company, the Trustee or any Agent
from any loss which any of them may suffer if a Security is replaced. In the
case of any lost Security that will become due and payable within 30 days, the
Company can choose to pay such Security rather than replacing such Security.
The Company may charge such Holder for its reasonable, out-of-pocket expenses in
replacing a Security.
Every replacement Security is an additional obligation of the Company.
SECTION 2.8. OUTSTANDING SECURITIES.
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee (including any Security represented by a
Global Security) except those cancelled by the Registrar, those delivered to
the Registrar for cancellation, those reductions in the interest in a Global
Security effected by the Registrar hereunder, those
30
paid pursuant to Section 2.7 and those described in this Section 2.8 as not
outstanding. A Security does not cease to be outstanding because the Company
or an Affiliate of the Company holds the Security, except as provided in
Section 2.9.
If a Security is replaced pursuant to Section 2.7 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Registrar receives proof satisfactory to it that the replaced
Security is held by a BONA FIDE purchaser. A mutilated Security ceases to be
outstanding upon surrender of such Security and replacement thereof pursuant to
Section 2.7.
If on a Redemption Date or the Maturity Date the Paying Agent (other
than the Company or an Affiliate of the Company) holds Cash or U.S. Government
Obligations sufficient to pay all of the principal and interest and premium, if
any, due on the Securities payable on that date and payment of the Securities
called for redemption is not otherwise prohibited, then on and after that date
such Securities cease to be outstanding and interest on them ceases to accrue.
SECTION 2.9. TREASURY SECURITIES.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, amendment, supplement, waiver or
consent, Securities owned by the Company or Affiliates of the Company shall be
disregarded, except that, for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, amendment, supplement,
waiver or consent, only Securities that a Trust Officer of the Trustee actually
knows are so owned shall be disregarded.
SECTION 2.10. TEMPORARY SECURITIES.
Until Definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of Definitive Securities but may
have variations that the Company reasonably and in good faith consider
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall, upon receipt of a written order of the
Company in the form of an Officers' Certificate, authenticate Definitive
Securities in exchange for temporary Securities. Until so exchanged, the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as permanent Securities authenticated and delivered
hereunder.
SECTION 2.11. CANCELLATION.
The Company at any time may deliver Securities to the Registrar for
cancellation. The Trustee and the Paying Agent shall forward to the Registrar
any Securities
31
surrendered to them for registration of transfer, exchange or payment. The
Registrar, or at the direction of the Registrar, the Trustee or the Paying
Agent (other than the Company or an Affiliate of the Company), and no one
else, shall cancel and, return to the Company all Securities surrendered for
registration of transfer, exchange, payment or cancellation. Subject to
Section 2.7, the Company may not issue new Securities to replace Securities
that have been paid or delivered to the Registrar for cancellation. No
Securities shall be authenticated in lieu of or in exchange for any
Securities cancelled as provided in this Section 2.11, except as expressly
permitted in the form of Securities and as permitted by this Indenture.
SECTION 2.12. DEFAULTED INTEREST.
Any interest on any Security which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date plus, to the extent
lawful, any interest payable on the defaulted interest at the rate and in the
manner provided in Section 4.1 hereof and the Security (herein called "Defaulted
Interest") shall forthwith cease to be payable to the registered holder on the
relevant Record Date, and such Defaulted Interest may be paid by the Company, at
its election in each case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the persons in whose names the Securities are registered at the
close of business on a Special Record Date for the payment of such
Defaulted Interest, which shall be fixed in the following manner. The
Company shall notify the Trustee and the Paying Agent in writing of the
amount of Defaulted Interest proposed to be paid on each Security and the
date of the proposed payment, and at the same time the Company shall
deposit with the Paying Agent an amount of Cash equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or shall
make arrangements satisfactory to the Paying Agent for such deposit prior
to the date of the proposed payment, such Cash when deposited to be held in
trust for the benefit of the persons entitled to such Defaulted Interest as
provided in this clause (1). Thereupon the Paying Agent shall fix a
Special Record Date for the payment of such Defaulted Interest which shall
be not more than 15 days and not less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the Paying
Agent of the notice of the proposed payment. The Paying Agent shall
promptly notify the Company and the Trustee of such Special Record Date
and, in the name and at the expense of the Company, shall cause notice of
the proposed payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to each Holder at his
address as it appears in the Security register not less than 10 days prior
to such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been mailed
as aforesaid, such Defaulted Interest shall be paid to the persons in whose
names the Securities (or their respective predecessor Securities) are
32
registered on such Special Record Date and shall no longer be payable
pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted Interest in
any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the
Company to the Trustee and the Paying Agent of the proposed payment
pursuant to this clause, such manner shall be deemed practicable by the
Trustee and the Paying Agent.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
SECTION 2.13. CUSIP NUMBERS.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; PROVIDED that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company will promptly notify
the Trustee of any change in the "CUSIP" numbers.
ARTICLE III
REDEMPTION
SECTION 3.1. RIGHT OF REDEMPTION.
Redemption of Securities, as permitted by the provisions of this
Indenture, shall be made in accordance with such provisions and this Article
III. The Company will not have the right to redeem any Securities prior to
February 15, 2003. On or after February 15, 2003, the Company will have the
right to redeem all or any part of the Securities pursuant to Paragraph 5
thereof, in each case (subject to the right of Holders of record on a Record
Date to receive interest due on an Interest Payment Date that is on or prior to
such Redemption Date, and subject to the provisions set forth in Section 3.5),
including accrued and unpaid interest to the Redemption Date.
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SECTION 3.2. NOTICES TO TRUSTEE AND PAYING AGENT.
If the Company elects to redeem Securities pursuant to Paragraph 5 of
the Securities, it shall notify the Trustee and the Paying Agent in writing of
the Redemption Date and the principal amount of Securities to be redeemed and
whether it wants the Paying Agent to give notice of redemption to the Holders.
If the Company elects to reduce the principal amount of Securities to
be redeemed pursuant to Paragraph 5 of the Securities by crediting against any
such redemption Securities it has not previously delivered to the Trustee and
the Paying Agent for cancellation, it shall so notify the Trustee, in the form
of an Officers' Certificate, and the Paying Agent of the amount of the reduction
and deliver such Securities with such notice.
The Company shall give each notice to the Trustee and the Paying Agent
provided for in this Section 3.2 at least 45 days before the Redemption Date
(unless a shorter notice shall be satisfactory to the Trustee and the Paying
Agent). Any such notice may be cancelled at any time prior to notice of such
redemption being mailed to any Holder and shall thereby be void and of no
effect.
SECTION 3.3. SELECTION OF SECURITIES TO BE REDEEMED.
If less than all of the Securities are to be redeemed pursuant to
Paragraph 5 thereof, the Trustee shall select the Securities to be redeemed by
lot or by such other method as the Trustee shall determine to be appropriate and
fair.
The Trustee shall make the selection from the Securities outstanding
and not previously called for redemption and shall promptly notify the Company
and the Paying Agent in writing of the Securities selected for redemption and,
in the case of any Security selected for partial redemption, the principal
amount thereof to be redeemed. Securities in denominations of $1,000 may be
redeemed only in whole. The Trustee may select for redemption portions (equal
to $1,000 or any integral multiple thereof) of the principal of Securities that
have denominations larger than $1,000. Provisions of this Indenture that apply
to Securities called for redemption also apply to portions of Securities called
for redemption.
SECTION 3.4. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first class mail, postage
prepaid, to the Trustee, the Paying Agent and each Holder whose Securities are
to be redeemed. At the Company's request, the Paying Agent shall give the
notice of redemption in the Company's
34
name and at the Company's expense. Each notice for redemption shall identify
the Securities to be redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price, including the amount of accrued and
unpaid interest to be paid upon such redemption;
(3) the name, address and telephone number of the Paying
Agent;
(4) that Securities called for redemption must be surrendered
to the Paying Agent at the address specified in such notice to collect the
Redemption Price;
(5) that, unless the Company defaults in its obligation to
deposit with the Paying Agent Cash, or U.S. Government Obligations which
through the scheduled payment of principal and interest in respect thereof
in accordance with their terms will provide, not later than one day before
the due date of any payment, Cash in an amount to fund the Redemption
Price, in accordance with Section 3.6 hereof or such redemption payment is
otherwise prohibited, interest on Securities called for redemption ceases
to accrue on and after the Redemption Date and the only remaining right of
the Holders of such Securities is to receive payment of the Redemption
Price, including accrued and unpaid interest to the Redemption Date, upon
surrender to the Paying Agent of the Securities called for redemption and
to be redeemed;
(6) if any Security is being redeemed in part, the portion of
the principal amount, equal to $1,000 or any integral multiple thereof, of
such Security to be redeemed and that, after the Redemption Date, and upon
surrender of such Security, a new Security or Securities in aggregate
principal amount equal to the unredeemed portion thereof will be issued;
(7) if less than all the Securities are to be redeemed, the
identification of the particular Securities (or portion thereof) to be
redeemed, as well as the aggregate principal amount of such Securities to
be redeemed and the aggregate principal amount of Securities to be
outstanding after such partial redemption;
(8) the CUSIP number of the Securities to be redeemed; and
(9) that the notice is being sent pursuant to this Section 3.4
and pursuant to the optional redemption provisions of Paragraph 5 of the
Securities.
35
SECTION 3.5. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.4,
Securities called for redemption become due and payable on the Redemption Date
and at the Redemption Price, including accrued and unpaid interest to the
Redemption Date. Upon surrender to the Paying Agent, such Securities called for
redemption shall be paid at the Redemption Price, including interest, if any,
accrued and unpaid to the Redemption Date; PROVIDED that if the Redemption Date
is after a regular Record Date and on or prior to the Interest Payment Date to
which such Record Date relates, the accrued interest shall be payable to the
Holder of the redeemed Securities registered on the relevant Record Date; and
PROVIDED, FURTHER, that if a Redemption Date is a non-Business Day, payment
shall be made on the next succeeding Business Day and no interest shall accrue
for the period from such Redemption Date to such succeeding Business Day.
SECTION 3.6. DEPOSIT OF REDEMPTION PRICE.
On or prior to 10:00 a.m., New York City time, on the Redemption Date,
the Company shall deposit with the Paying Agent (other than the Company or an
Affiliate of the Company) Cash or U.S. Government Obligations sufficient to pay
the Redemption Price of, including accrued and unpaid interest on, all
Securities to be redeemed on such Redemption Date (other than Securities or
portions thereof called for redemption on that date that have been delivered by
the Company to the Registrar for cancellation). The Paying Agent shall promptly
return to the Company any Cash or U.S. Government Obligations so deposited which
is not required for that purpose upon the written request of the Company.
If the Company complies with the preceding paragraph and the other
provisions of this Article III and payment of the Securities called for
redemption is not otherwise prohibited, interest on the Securities to be
redeemed will cease to accrue on the applicable Redemption Date, whether or not
such Securities are presented for payment. Notwithstanding anything herein to
the contrary, if any Security surrendered for redemption in the manner provided
in the Securities shall not be so paid upon surrender for redemption because of
the failure of the Company to comply with the preceding paragraph, interest
shall continue to accrue and be paid from the Redemption Date until such payment
is made on the unpaid principal, and, to the extent lawful, on any interest not
paid on such unpaid principal, in each case at the rate and in the manner
provided in Section 4.1 hereof and the Security.
SECTION 3.7. SECURITIES REDEEMED IN PART.
Upon surrender of a Security that is to be redeemed in part, the
Company shall execute and the Trustee shall authenticate and deliver to the
Holder, without service charge to the Holder, a new Security or Securities equal
in principal amount to the unredeemed portion of the Security surrendered.
36
ARTICLE IV
COVENANTS
SECTION 4.1. PAYMENT OF SECURITIES.
The Company shall pay the principal of and interest and premium, if
applicable, on the Securities on the dates and in the manner provided herein and
in the Securities. An installment of principal of or interest and premium, if
applicable, on the Securities shall be considered paid on the date it is due if
the Trustee or Paying Agent (other than the Company, a Subsidiary of the Company
or an Affiliate of the Company) holds for the benefit of the Holders, on or
before 10:00 a.m. New York City time on that date, Cash deposited and designated
for and sufficient to pay the installment.
The Company shall pay interest on overdue principal and on overdue
installments of interest at the rate specified in the Securities compounded
semi-annually, to the extent lawful.
SECTION 4.2. MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain in the Borough of Manhattan, The City of
New York, an office or agency where Securities may be presented or surrendered
for payment, where Securities may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. The Company shall give prompt
written notice to the Trustee and the Paying Agent 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 and the Paying Agent with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 13.2.
The Company may also from time to time designate one or more other
offices or agencies where the Securities 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 and the Paying Agent of any such
designation or rescission and of any change in the location of any such other
office or agency. The Company hereby initially designates the principal
corporate trust office of the Paying Agent as such office.
37
SECTION 4.3. LIMITATION ON RESTRICTED PAYMENTS.
On and after the Issue Date the Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly, make any Restricted
Payment, if, after giving effect to such Restricted Payment on a PRO FORMA
basis, (1) a Default or an Event of Default shall have occurred and be
continuing, (2) the Company is not permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Leverage Ratio in Section 4.11, or (3)
the aggregate amount of all Restricted Payments made by the Company and its
Subsidiaries, including after giving effect to such proposed Restricted Payment,
from and after the Issue Date, would exceed the sum of (a)(x) 100% of the
aggregate Consolidated EBITDA of the Company and its Consolidated Subsidiaries
for the period (taken as one accounting period), commencing on the first day of
the first full fiscal quarter commencing after the Issue Date, to and including
the last day of the fiscal quarter ended immediately prior to the date of each
such calculation (or, in the event Consolidated EBITDA for such period is a
deficit, then minus 100% of such deficit) less (y) 1.4 times Consolidated Fixed
Charges for the same period plus (b) the aggregate Net Cash Proceeds received by
the Company from the Common Stock Offering and the LYONs Offering, plus (c) the
aggregate Net Cash Proceeds received by the Company from the sale of its
Qualified Capital Stock (other than (i) to a Subsidiary of the Company and (ii)
to the extent applied in connection with a Qualified Exchange), after the Issue
Date.
The foregoing clauses (2) and (3) of the immediately preceding
paragraph, however, will not prohibit (w) payments to the Parent Guarantor to
reimburse the Parent Guarantor for reasonable and necessary corporate and
administrative expenses, (x) Restricted Investments, PROVIDED, that, after
giving PRO FORMA effect to such Restricted Investment, the aggregate amount of
all such Restricted Investments made on or after the Issue Date that are
outstanding (after giving effect to any such Restricted Investments that are
returned to the Company or the Subsidiary Guarantor that made such prior
Restricted Investment, without restriction, in cash on or prior to the date of
any such calculation) at any time does not exceed $25.0 million, (y) a Qualified
Exchange and (z) the payment of any dividend on Qualified Capital Stock within
60 days after the date of its declaration if such dividend could have been made
on the date of such declaration in compliance with the foregoing provisions.
The full amount of any Restricted Payment made pursuant to the foregoing clauses
(x) and (z) of the immediately preceding sentence, however, will be deducted in
the calculation of the aggregate amount of Restricted Payments available to be
made pursuant to clause (3) of the immediately preceding paragraph.
SECTION 4.4. CORPORATE EXISTENCE.
Subject to Article V, the Company and the Guarantors shall do or cause
to be done all things necessary to preserve and keep in full force and effect
their respective corporate existence in accordance with the respective
organizational documents of each of
38
them (as the same may be amended from time to time) and the rights (charter
and statutory) and corporate franchises of the Company and the Guarantors;
PROVIDED, HOWEVER, nothing in this Section will prohibit the Company or any
Guarantor from engaging in any transaction permitted under Section 12.4 or
Section 12.5 hereof and PROVIDED FURTHER that neither the Company nor any
Guarantor shall be required to preserve any right or franchise if (a) the
Board of Directors of the Company shall determine that the preservation
thereof is no longer desirable in the conduct of the business of such entity
and (b) the loss thereof is not disadvantageous in any material respect to
the Holders.
SECTION 4.5. PAYMENT OF TAXES AND OTHER CLAIMS.
Except with respect to immaterial items, the Company and the
Guarantors shall, and shall cause each of their Subsidiaries to, pay or
discharge or cause to be paid or discharged, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges (including
withholding taxes and any penalties, interest and additions to taxes) levied or
imposed upon the Company and the Guarantors or any of their Subsidiaries or any
of their respective properties and assets; and (ii) all lawful claims, whether
for labor, materials, supplies, services or anything else, which have become due
and payable and which by law have or may become a Lien upon the property and
assets of the Company and the Guarantors or any of their Subsidiaries; PROVIDED,
HOWEVER, that neither the Company nor any of the Guarantors shall be required to
pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate proceedings and for which disputed amounts adequate
reserves have been established in accordance with GAAP.
SECTION 4.6. MAINTENANCE OF PROPERTIES AND INSURANCE.
The Company and the Guarantors shall cause all material properties
used or useful to the conduct of their business and the business of each of
their Subsidiaries to be maintained and kept in good condition, repair and
working order (reasonable wear and tear excepted) and supplied with all
necessary equipment and shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in their reasonable
judgment may be necessary, so that the business carried on in connection
therewith may be properly conducted at all times; PROVIDED, HOWEVER, that
nothing in this Section 4.6 shall prevent the Company or any Guarantor from
discontinuing any operation or maintenance of any of such properties, or
disposing of any of them, if such discontinuance or disposal is (a), in the
judgment of the Board of Directors of the Company, desirable in the conduct of
the business of such entity and (b) not disadvantageous in any material respect
to the Holders.
The Company and the Guarantors shall provide, or cause to be provided,
for themselves and each of their Subsidiaries, insurance (including appropriate
self-insurance)
39
against loss or damage of the kinds that, in the reasonable, good faith
opinion of the Company is adequate and appropriate for the conduct of the
business of the Company, the Guarantors and such Subsidiaries.
SECTION 4.7. COMPLIANCE CERTIFICATE; NOTICE OF DEFAULT.
(a) The Company shall deliver to the Trustee within 120 days
after the end of each fiscal year (beginning with the fiscal year ending
December 31, 1997) an Officers' Certificate, one of the signers of which shall
be the principal executive, principal financial or principal accounting officer
of the Company, complying with Section 314(a)(4) of the TIA and stating that a
review of its activities and the activities of its Subsidiaries, if any, 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 (without regard to
notice requirements or grace periods) and further stating, as to each such
Officer signing such certificate, whether or not the signer knows of any failure
by the Company or any Guarantor to comply with any conditions or covenants in
this Indenture and, if such signer does know of such a failure to comply, the
certificate shall describe such failure with particularity. The Officers'
Certificate shall also notify the Trustee should the relevant fiscal year end on
any date other than the current fiscal year end date.
(b) The Company shall, so long as any of the Securities are
outstanding, deliver to the Trustee, promptly upon 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. The Trustee shall not be deemed to have knowledge of any
Default or any Event of Default unless one of its Trust Officers receives
written notice thereof from the Company or any of the Holders.
SECTION 4.8. REPORTS.
For so long as the Parent Guarantor or any successor thereto is
subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act
and the Company is a wholly owned Subsidiary of the Parent Guarantor, the
Company shall deliver to the Trustee, and to each Holder, the Parent Guarantor's
annual and quarterly reports pursuant to Section 13 or 15(d) of the Exchange
Act, within 15 days after such reports have been filed with the Commission;
PROVIDED, HOWEVER; in the event either (i) the Parent Guarantor or a successor
as set forth above is no longer subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act or (ii) the Company is no longer a
wholly owned Subsidiary of the Parent Guarantor or a successor as set forth
above, then whether or not the Company is subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, the Company shall
deliver to the Trustee and, to each Holder, within 15 days after it is or
would have been (if it were subject to such reporting obligations) required
to file such with the
40
Commission, annual and quarterly financial statements substantially
equivalent to financial statements that would have been included in reports
filed with the Commission, if the Company were subject to the requirements of
Section 13 or 15(d) of the Exchange Act, including, with respect to annual
information only, a report thereon by the Company's certified independent
accountants as such would be required in such reports to the Commission, and,
in each case, together with a management's discussion and analysis of
financial condition and results of operations which would be so required and,
to the extent permitted by the Exchange Act or the Commission (if it were
subject to such reporting obligations), file with the Commission the annual,
quarterly and other reports which it is or would have been required to file
with the Commission.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
SECTION 4.9. LIMITATION ON STATUS AS INVESTMENT COMPANY.
Neither the Company nor any Subsidiary shall become an "investment
company" (as that term is defined in the Investment Company Act of 1940, as
amended), or otherwise become subject to regulation under the Investment Company
Act.
SECTION 4.10. LIMITATION ON TRANSACTIONS WITH AFFILIATES.
After the Issue Date, the Company shall not, and shall not permit any
of its Subsidiaries to, enter into any contract, agreement, arrangement or
transaction with any Affiliate (an "Affiliate Transaction") or any series of
related Affiliate Transactions (other than Exempted Affiliate Transactions)
(i) unless it is determined that the terms of such Affiliate Transaction are
fair and reasonable to the Company, and no less favorable to the Company than
could have been obtained in an arm's length transaction with a non-Affiliate
and, (ii) if involving consideration to either party in excess of $10.0 million,
unless such Affiliate Transaction(s) is evidenced by (A) an Officers'
Certificate addressed and delivered to the Trustee certifying that such
Affiliate Transaction(s) has been approved by a majority of the members of the
Board of Directors of the Company that are disinterested in such transaction or,
(B) in the event there are no members of the Board of Directors of the Company
who are disinterested in such transaction, then so long as the Company is a
wholly owned Subsidiary of the Parent Guarantor, an Officers' Certificate
addressed and delivered to the Trustee certifying that such Affiliate
Transaction(s) have been approved by a majority of the members of the Board of
Directors of the Parent Guarantor that are disinterested in such transaction and
(iii) if involving consideration to either party in excess of $25.0 million,
unless in addition the Company, prior to the consummation thereof, obtains a
written
41
favorable opinion as to the fairness of such transaction to the Company
from a financial point of view from an independent investment banking firm of
national reputation.
SECTION 4.11. LIMITATION ON INCURRENCE OF ADDITIONAL INDEBTEDNESS
AND DISQUALIFIED CAPITAL STOCK.
Except as set forth below, neither the Company nor any of the
Company's Subsidiaries shall, directly or indirectly, issue, assume, guaranty,
incur, become directly or indirectly liable with respect to (including as a
result of an Acquisition), or otherwise become responsible for, contingently or
otherwise (individually and collectively, to "incur" or, as appropriate, an
"incurrence"), any Indebtedness or any Disqualified Capital Stock (including
Acquired Indebtedness) other than Permitted Indebtedness. Notwithstanding the
foregoing limitations, the Company may incur, and the Subsidiaries may
guarantee, Indebtedness and Disqualified Capital Stock in addition to Permitted
Indebtedness: if (i) no Default or Event of Default shall have occurred and be
continuing at the time of, or would occur after giving effect on a PRO FORMA
basis to, such incurrence of Indebtedness or Disqualified Capital Stock and
(ii) on the date of such incurrence (the "Incurrence Date"), the Leverage Ratio
of the Company for the Reference Period immediately preceding the Incurrence
Date, after giving effect on a PRO FORMA basis to such incurrence of such
Indebtedness or Disqualified Capital Stock and, to the extent set forth in
the definition of Leverage Ratio, the use of proceeds thereof, would be less
than 7.0 to 1.
Indebtedness or Disqualified Capital Stock of any person which is
outstanding at the time such person becomes a Subsidiary of the Company
(including upon designation of any subsidiary or other person as a Subsidiary)
or is merged with or into or consolidated with the Company or a Subsidiary of
the Company shall be deemed to have been Incurred at the time such Person
becomes such a Subsidiary of the Company or is merged with or into or
consolidated with the Company or a Subsidiary of the Company, as applicable.
SECTION 4.12. LIMITATIONS ON DIVIDENDS AND OTHER PAYMENT
RESTRICTIONS AFFECTING SUBSIDIARIES.
Neither the Company nor any of its Wholly Owned Subsidiaries shall
permit any of their Subsidiaries that are Wholly Owned Subsidiaries to, create,
assume or suffer to exist any consensual restriction on the ability of any such
Subsidiary of the Company to pay dividends or make other distributions to or on
behalf of, or to pay any obligation to or on behalf of, or otherwise to transfer
assets or property to or on behalf of, or make or pay loans or advances to or on
behalf of, the Company or any Wholly Owned Subsidiary of the Company, except (a)
restrictions imposed by the Securities or this Indenture, (b) restrictions
imposed by applicable law, (c) existing restrictions under Indebtedness
outstanding on the Issue Date, (d) restrictions under any Acquired Indebtedness
not incurred in violation of this Indenture or any agreement relating to any
property, asset, or business acquired by the
42
Company or any of its Subsidiaries, which restrictions in each case existed
at the time of acquisition, were not put in place in connection with or in
anticipation of such acquisition and are not applicable to any person, other
than the person acquired, or to any property, asset or business, other than
the property, assets and business so acquired, (e) any such restriction or
requirement imposed by Indebtedness incurred under paragraph (f) under the
definition of Permitted Indebtedness, provided such restriction or
requirement is no more restrictive than that imposed by the Credit Facility
as of the Issue Date, (f) restrictions with respect solely to a Subsidiary of
the Company imposed pursuant to a binding agreement which has been entered
into for the sale or disposition of all or substantially all of the Equity
Interests or assets of such Subsidiary, provided such restrictions apply
solely to the Equity Interests or assets of such Subsidiary which are being
sold, and (g) in connection with and pursuant to permitted Refinancings,
replacements of restrictions imposed pursuant to clauses (a), (c) or (d) of
this paragraph that are not more restrictive than those being replaced and do
not apply to any other person or assets than those that would have been
covered by the restrictions in the Indebtedness so refinanced.
Notwithstanding the foregoing, neither (a) customary provisions restricting
subletting or assignment of any lease entered into in the ordinary course of
business, consistent with industry practice, or other standard non-assignment
clauses in contracts entered into in the ordinary course of business, (b)
Capital Leases or agreements governing purchase money Indebtedness which
contain restrictions of the type referred to above with respect to the
property covered thereby, nor (c) Liens permitted under the terms hereof on
assets securing Senior Debt incurred pursuant to the Leverage Ratio in
Section 4.11 or permitted pursuant to the definition of Permitted
Indebtedness, shall in and of themselves be considered a restriction on the
ability of the applicable Subsidiary to transfer such agreement or assets, as
the case may be.
SECTION 4.13. LIMITATIONS ON LAYERING INDEBTEDNESS; LIENS.
The Company and its Subsidiaries shall not, and shall not permit any
of their Subsidiaries to, directly or indirectly, incur, or, other than with
respect to the 8 3/4% Notes, the 9 3/4% Notes and the 10 1/8% Notes, suffer to
exist (a) any Indebtedness that is subordinate in right of payment to any other
Indebtedness of the Company or a Guarantor unless, by its terms, such
Indebtedness (i) has a maturity date subsequent to the Stated Maturity of the
Securities and an Average Life longer than that of the Securities and (ii) is
subordinate in right of payment to, or ranks PARI PASSU with, the Securities or
the Guarantees, as applicable, or (b) other than Permitted Liens, any Lien upon
any of properties or assets, whether now owned or hereafter acquired, or upon
any income or profits therefrom securing Indebtedness other than (1) Liens
securing Senior Debt incurred pursuant to the Leverage Ratio in accordance with
Section 4.11 and (2) Liens securing Senior Debt incurred as permitted pursuant
to the definition of Permitted Indebtedness.
43
SECTION 4.14. LIMITATION ON SALE OF ASSETS AND SUBSIDIARY STOCK.
The Company and its Subsidiaries shall not, and shall not permit any
of their Subsidiaries to, in one or a series of related transactions, sell,
transfer, or otherwise dispose of, any of its property, business or assets,
including by merger or consolidation (in the case of a Guarantor or a Subsidiary
of the Company), and including any sale or other transfer or issuance of any
Equity Interests of any direct or indirect Subsidiary of the Company, whether by
the Company or a direct or indirect Subsidiary thereof (an "Asset Sale"), unless
(1) within 450 days after the date of such Asset Sale, the Net Cash Proceeds
therefrom (the "Asset Sale Offer Amount") are (a) applied to the optional
redemption of the Securities in accordance with the terms hereof and the
Securities or to the repurchase of the Securities pursuant to an irrevocable,
unconditional cash offer (the "Asset Sale Offer") to repurchase Securities at a
purchase price (the "Asset Sale Offer Price") of 100% of principal amount, plus
accrued interest to the date of payment, (b) invested in assets and property
(other than notes, bonds, obligations and securities) which in the good faith
reasonable judgment of the Board of the Company will immediately constitute or
be a part of a Related Business of the Company or a Subsidiary (if it continues
to be a Subsidiary) immediately following such transaction or (c) used to
permanently retire or reduce Senior Debt or Indebtedness permitted pursuant to
paragraphs (d), (e) or (f) under the definition of Permitted Indebtedness
(including that in the case of a revolver or similar arrangement that makes
credit available, such commitment is so permanently reduced by such amount),
(2) with respect to any Asset Sale or related series of Asset Sales involving
securities, property or assets with an aggregate fair market value in excess of
$2.5 million, at least 75% of the consideration for such Asset Sale or series of
related Asset Sales (excluding the amount of (A) any Indebtedness (other than
the Securities) that is required to be repaid or assumed (and is either repaid
or assumed by the transferee of the related assets) by virtue of such Asset Sale
and which is secured by a Lien on the property or asset sold and (B) property
received by the Company or any such Subsidiary from the transferee that within
90 days of such Asset Sale is converted into cash or Cash Equivalents) consists
of cash or Cash Equivalents (other than in the case of an Asset Swap or where
the Company is exchanging all or substantially all the assets of one or more
Related Businesses operated by the Company or its Subsidiaries (including by way
of the transfer of capital stock) for all or substantially all the assets
(including by way of the transfer of capital stock) constituting one or more
Related Businesses operated by another person, in which event the foregoing
requirement with respect to the receipt of cash or Cash Equivalents shall not
apply), (3) no Default or Event of Default shall have occurred and be continuing
at the time of, or would occur after giving effect, on a PRO FORMA basis, to,
such Asset Sale, and (4) the Board of the Company determines in good faith that
the Company or such Subsidiary, as applicable, receives fair market value for
such Asset Sale.
Notwithstanding the foregoing provisions of the first paragraph of
this covenant, with respect to an Asset Sale Offer, the Company shall not
commence an Asset
44
Sale Offer for the Securities until such time as an Asset Sale Offer for the
10 1/8% Notes, the 9 3/4% Notes and the 8 3/4% Notes, in each case, if
required, has been completed. To the extent that any Excess Proceeds remain
after expiration of an Asset Sale Offer Period for the 10 1/8% Notes and the
9 3/4% Notes and the 8 3/4% Notes, the Company shall use the remaining Net Cash
Proceeds, to the extent "Excess Proceeds" (as defined herein) exceeds
$5,000,000, to commence an Asset Sale Offer for the Securities; PROVIDED,
that this paragraph shall be of no further force and effect (i) with respect
to the 10 1/8 Notes, upon the earlier of (w) the maturity of the 10 1/8% Notes,
(x) the date upon which defeasance of the 10 1/8% Notes becomes effective,
(y) the date on which there are no longer any 10 1/8% Notes outstanding in
accordance with the terms of the indenture governing the 10 1/8% Notes and
(z) the date on which the Limitation on Sale of Assets and Subsidiary Stock
covenant no longer applies in accordance with the terms of the indenture
governing the 10 1/8% Notes, (ii) with respect to the 9 3/4% Notes, upon the
earlier of (w) the maturity of the 9 3/4% Notes, (x) the date upon which
defeasance of the 9 3/4% Notes becomes effective, (y) the date on which there
are no longer any 9 3/4% Notes outstanding in accordance with the terms of
the indenture governing the 9 3/4% Notes and (z) the date on which the
Limitation of Sale of Assets and Subsidiary Stock covenant no longer applies
in accordance with the terms of the indenture governing the 9 3/4% Notes and
(iii) with respect to the 8 3/4% Notes, upon the earlier of (w) the maturity
of the 8 3/4% Notes, (x) the date upon which defeasance of the 8 3/4% Notes
becomes effective, (y) the date on which there are no longer any 8 3/4% Notes
outstanding in accordance with the terms of the indenture governing the 8 3/4%
Notes and (z) the date on which the Limitation of Sale of Assets and
Subsidiary Stock covenant no longer applies in accordance with the terms of
the indenture governing the 8 3/4% Notes.
In addition, notwithstanding the foregoing provisions of the first
paragraph of this covenant:
(i) the Company and its Subsidiaries may convey,
sell, lease, transfer, assign or otherwise dispose of assets pursuant to an
in accordance with the provisions of Section 5.1;
(ii) the Company and its Subsidiaries may sell or
dispose of inventory or damaged, worn out or other obsolete property in the
ordinary course of business so long as such property is no longer necessary
for the proper conduct of the business of the Company or such Subsidiary,
as applicable; and
(iii) any of the Company's Subsidiaries may convey,
sell, transfer, assign or otherwise dispose of assets to, or merge with or
into, the Company or any of its Wholly owned Subsidiary Guarantors.
The Company shall accumulate all Net Cash Proceeds (including any cash
as and when received from the proceeds of any property which itself was acquired
in
45
consideration of an Asset Sale), and the aggregate amount of such accumulated
Net Cash Proceeds not used for the purposes permitted and within the time
provided by this Section 4.14 is referred to as the "Excess Proceeds."
For purposes of this Section 4.14, "Excess Proceeds Date" means each
date on which the Excess Proceeds exceeds $5,000,000. Not later than ten
Business Days after each Excess Proceeds Date, the Company will commence an
Asset Sale Offer, to the Holders to purchase, on a PRO RATA basis, for Cash,
Securities having a principal amount equal to the Excess Proceeds Amount at the
Asset Sale Offer Price, equal to 100% of principal amount, plus accrued but
unpaid interest to, and including, the date (the "Purchase Date"), the
Securities tendered are purchased and paid for in accordance with this
Section 4.14. The Asset Sale Offer shall remain open for twenty Business
Days, except to the extent that a longer period is required by applicable
law, but in any case not more than sixty Business Days after such Excess
Proceeds Date. Notice of an Asset Sale Offer will be sent on or before the
commencement of any Asset Sale Offer, by first-class mail, by the Company to
each Holder at its registered address, with a copy to the Trustee. The
notice to the Holders will contain all information, instructions and
materials required by applicable law or otherwise material to such Holders'
decision to tender Securities pursuant to the Asset Sale Offer. The notice,
which (to the extent consistent with this Indenture) shall govern the terms
of the Asset Sale Offer, shall state:
(1) that the Asset Sale Offer is being made pursuant
to such notice and this Section 4.14;
(2) the Asset Sale Offer Amount, the Asset Sale
Offer Price (including the amount of accrued and unpaid
interest), the Final Put Date (as defined below), and the
Purchase Date, which Purchase Date shall be on or prior to 60
Business Days following the Excess Proceeds Date;
(3) that any Security or portion thereof not
tendered or accepted for payment will continue to accrue
interest;
(4) that, unless the Company defaults in depositing
Cash with the Paying Agent in accordance with the immediately
following paragraph of this Section 4.14 or such payment is
otherwise prevented, any Security, or portion thereof, accepted
for payment pursuant to the
46
Asset Sale Offer shall cease to accrue interest after the Purchase
Date;
(5) that Holders electing to have a Security, or
portion thereof, purchased pursuant to an Asset Sale Offer will
be required to surrender the Security, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the
Security completed, to the Paying Agent (which may not for
purposes of this Section 4.14, notwithstanding anything in this
Indenture to the contrary, be the Company or any Affiliate of the
Company) at the address specified in the notice prior to the
close of business on the earlier of (a) the third Business Day
prior to the Purchase Date and (b) the third Business Day
following the expiration of the Asset Sale Offer (such earlier
date being the "Final Put Date");
(6) that Holders will be entitled to withdraw their
elections, in whole or in part, if the Paying Agent (which may
not for purposes of this Section 4.14, notwithstanding any other
provision of this Indenture, be the Company or any Affiliate of
the Company) receives, up to the close of business on the Final
Put Date, a facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Securities the
Holder is withdrawing and a statement that such Holder is
withdrawing his election to have such principal amount of
Securities purchased;
(7) that if Securities in a principal amount in
excess of the principal amount of Securities to be acquired
pursuant to the Asset Sale Offer are tendered and not withdrawn,
the Trustee shall select the Securities to be purchased on a PRO
RATA basis (with such adjustments as may be deemed appropriate by
the Company so that only Securities in denominations of $1,000 or
integral multiples of $1,000 shall be acquired);
47
(8) that Holders whose Securities were purchased
only in part will be issued new Securities equal in principal
amount to the unpurchased portion of the Securities surrendered;
and
(9) a brief description of the circumstances and
relevant facts regarding such Asset Sales.
On or before a Purchase Date, the Company shall, to the extent lawful,
(i) accept for payment Securities or portions thereof properly tendered pursuant
to the Asset Sale Offer on or before the Final Put Date (on a PRO RATA basis if
required pursuant to paragraph (7) of this Section 4.14), (ii) deposit with the
Paying Agent Cash sufficient to pay the Asset Sale Offer Price for all
Securities or portions thereof so tendered and accepted and (iii) deliver to the
Paying Agent Securities so accepted together with an Officers' Certificate
stating the Securities or portions thereof being purchased by the Company. The
Paying Agent shall on each Purchase Date mail or deliver to Holders of
Securities so accepted payment in an amount equal to the Asset Sale Offer Price
for such Securities, and the Trustee shall promptly authenticate and mail or
deliver to such Holders a new Security equal in principal amount to any
unpurchased portion of the Security surrendered; PROVIDED that if the Purchase
Date is after a regular Record Date and on or prior to the Interest Payment Date
to which such Record Date relates, the accrued interest shall be payable to the
Holder of the purchased Securities registered on the relevant Record Date. Any
Security not so accepted shall be promptly mailed or delivered by the Company to
the Holder thereof.
All Net Cash Proceeds from an Event of Loss shall be applied to the
restoration, repair or replacement of the asset so affected or invested, used
for prepayment of Senior Debt, or used to repurchase Securities, all within the
period and as otherwise provided above in clauses 1(a), 1(b) or 1(c) of the
first paragraph of this covenant.
In addition to the foregoing, the Company will not, and will not
permit any of its Subsidiaries to, directly or indirectly make any Asset Sale of
any of the Equity Interests of any Subsidiary except pursuant to an Asset Sale
of all the Equity Interests of such Subsidiary.
Any such Asset Sale Offer shall comply with all applicable laws, rules
and regulations, including Regulation 14E of the Exchange Act and the rules and
regulations thereunder and all other applicable Federal and State securities
laws, if applicable, and any provisions of this Indenture that conflict with
such laws shall be deemed to be superseded by the provisions of such laws.
48
If the amount required to be paid by the Company in order to acquire
all Securities duly tendered by Holders (and not withdrawn) pursuant to an Asset
Sale Offer (the "Acceptance Amount"), made pursuant to the second paragraph of
this Section 4.14 is less than the Asset Sale Offer Amount, the excess of the
Asset Sale Offer Amount over the Acceptance Amount may be used by the Company
for general corporate purposes without restriction, unless otherwise restricted
by the other provisions of this Indenture. Upon consummation of any Asset Sale
Offer made in accordance with the terms of this Indenture, the Accumulated
Amount will be reduced to zero irrespective of the amount of Securities tendered
pursuant to the Asset Sale Offer.
Notwithstanding the foregoing provisions of clause (1)(b) in the first
paragraph of this Section 4.14, the Company may invest in a controlling interest
in the Capital Stock of an entity engaged in a Related Business; PROVIDED, that
concurrently with such an Investment, such entity becomes a Subsidiary
Guarantor.
SECTION 4.15. LIMITATION ON ASSET SWAPS.
Neither the Company nor any of its Subsidiaries shall, and shall not
permit any of their Subsidiaries to, in one or a series of related transactions,
directly or indirectly, engage in any Asset Swaps, unless: (i) at the time of
entering into the agreement to swap assets and immediately after giving effect
to the proposed Asset Swap, no Default or Event of Default shall have occurred
and be continuing or would occur as a consequence thereof; (ii) the Company
would, after giving PRO FORMA effect to the proposed Asset Swap, have been
permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Leverage Ratio; (iii) the respective fair market values of the assets being
purchased and sold by the Company or any of its Subsidiaries (as determined in
good faith by the management of the Company or, if such Asset Swap includes
consideration in excess of $2.5 million by the Board of Directors of the
Company, as evidenced by a Board Resolution) are substantially the same at the
time of entering into the agreement to swap assets; and (iv) at the time of the
consummation of the proposed Asset Swap, the percentage of any decline in the
fair market value (determined as aforesaid) of the asset or assets being
acquired by the Company and its Subsidiaries shall not be significantly greater
than the percentage of any decline in the fair market value (determined as
aforesaid) of the assets being disposed of by the Company or its Subsidiaries,
calculated from the time the agreement to swap assets was entered into.
SECTION 4.16. LIMITATION ON LINES OF BUSINESS.
The Company and its Subsidiaries shall not, and shall not permit any
of their Subsidiaries to, directly or indirectly, engage to any substantial
extent in any line or lines of business activity other than that which, in the
reasonable good faith judgment of the Board of Directors of the Company is a
Related Business.
49
SECTION 4.17. RESTRICTION ON SALE AND ISSUANCE OF SUBSIDIARY STOCK.
Neither the Company nor the Guarantors shall sell, or permit any of
their Subsidiaries to issue or sell, any Equity Interests of any Subsidiary of
the Company to any person other than the Company or a Wholly owned Subsidiary of
the Company, except for Equity Interests with no preferences or special rights
or privileges and with no redemption or prepayment provisions.
SECTION 4.18. WAIVER OF STAY, EXTENSION OR USURY LAWS.
Each of the Company and the Guarantors covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law which would prohibit or forgive the
Company or any Guarantor from paying all or any portion of the principal of,
premium of, or interest on the Securities as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture; and (to the extent that it may
lawfully do so) each of the Company and the Guarantors hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee or any
Paying Agent, but will suffer and permit the execution of every such power as
though no such law had been enacted.
ARTICLE V
SUCCESSOR CORPORATION
SECTION 5.1. LIMITATION ON MERGER, SALE OR CONSOLIDATION.
(a) The Company will not, directly or indirectly, consolidate
with or merge with or into another person or sell, lease, convey or transfer all
or substantially all of its assets (computed on a consolidated basis), whether
in a single transaction or a series of related transactions, to another person
or group of affiliated persons or adopt a Plan of Liquidation, unless (i) either
(a) the Company is the continuing entity or (b) the resulting, surviving or
transferee entity or in the case of a Plan of Liquidation, the entity which
receives the greatest value from such Plan of Liquidation is a corporation
organized under the laws of the United States, any state thereof or the District
of Columbia and expressly assumes by supplemental indenture all of the
obligations of the Company in connection with the Securities and this Indenture;
(ii) no Default or Event of Default shall exist or shall occur immediately after
giving effect on a PRO FORMA basis to such transaction; and (iii) immediately
after giving effect to such transaction on a PRO FORMA basis, the consolidated
resulting, surviving or transferee entity or, in the case of a Plan of
Liquidation, the entity which receives the greatest value from such Plan of
Liquidation would immediately
50
thereafter be permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Leverage Ratio set forth in Section 4.11.
(b) For purposes of clause (a), the sale, lease, conveyance,
assignment, transfer, or other disposition of all or substantially all of the
properties and assets of one or more Subsidiaries of the Company, which
properties and assets, if held by the Company instead of such Subsidiaries,
would constitute all or substantially all of the properties and assets of the
Company on a consolidated basis, shall be deemed to be the transfer of all or
substantially all of the properties and assets of the Company.
SECTION 5.2. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger or any transfer of all or
substantially all of the assets of the Company or consummation of a Plan of
Liquidation in accordance with Section 5.1 hereof, the successor corporation
formed by such consolidation or into which the Company is merged or to which
such transfer is made or, in the case of a Plan of Liquidation, the entity which
receives the greatest value from such Plan of Liquidation shall succeed to, and
be substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor corporation had been
named herein as the Company, and when a successor corporation duly assumes all
of the obligations of the Company pursuant hereto and pursuant to the
Securities, the Company shall be released from such obligations under the
Securities and this Indenture except with respect to any obligations that arise
from or are related to, such transaction.
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES
SECTION 6.1. EVENTS OF DEFAULT.
"Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be caused voluntarily or involuntarily or effected, without limitation, by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) failure by the Company to pay any installment of interest
upon the Securities as and when the same becomes due and payable, and the
continuance of any such failure for a period of 30 days;
(2) failure by the Company to pay all or any part of the
principal of or premium, if any, on the Securities when and as the same
becomes due and payable
51
at maturity, upon redemption, by acceleration, or otherwise, including,
without limitation, default in the payment of the Change of Control
Purchase Price in accordance with Article XI or the Asset Sale Offer
Price in accordance with Section 4.14, or otherwise;
(3) failure by the Company or any Guarantor to observe or
perform any other covenant or agreement contained in the Securities or
this Indenture and, subject to certain exceptions, the continuance of such
failure for a period of 60 days after written notice is given to the
Company by the Trustee or to the Company and the Trustee by the Holders of
at least 25% in aggregate principal amount of the Securities outstanding,
specifying such default or breach, requiring it to be remedied and stating
that such notice is a "Notice of Default" hereunder;
(4) decree, judgment, or order by a court of competent
jurisdiction shall have been entered adjudicating the Company or any of its
Significant Subsidiaries as bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization of the Company or any of its
Significant Subsidiaries under any bankruptcy or similar law, and such
decree or order shall have continued undischarged and unstayed for a period
of 60 consecutive days; or a decree, judgment or order of a court of
competent jurisdiction appointing a receiver, liquidator, trustee, or
assignee in bankruptcy or insolvency for the Company, any of its
Significant Subsidiaries, or any substantial part of the property of any
such Person, or for the winding up or liquidation of the affairs of any
such Person, shall have been entered, and such decree, judgment, or order
shall have remained in force undischarged and unstayed for a period of 60
days;
(5) default in any issue of Indebtedness of the Company or any
of its Subsidiaries with an aggregate principal amount in excess of $5.0
million, in either case (a) resulting from the failure to pay principal at
final maturity, or (b) as a result of which the maturity of such
Indebtedness has been accelerated prior to its stated maturity;
(6) the Company or any of its Significant Subsidiaries shall
institute proceedings to be adjudicated a voluntary bankrupt, or shall
consent to the filing of a bankruptcy proceeding against it, or shall file
a petition or answer or consent seeking reorganization under any bankruptcy
or similar law or similar statute, or shall consent to the filing of any
such petition, or shall consent to the appointment of a Custodian,
receiver, liquidator, trustee, or assignee in bankruptcy or insolvency of
it or any substantial part of its assets or property, or shall make a
general assignment for the benefit of creditors, or shall admit in writing
its inability to pay its debts generally as they become due, fail generally
to pay its debts as they become due, or take any corporate action in
furtherance of any of the foregoing; or
52
(7) final unsatisfied judgments not covered by insurance
aggregating in excess of $5.0 million at any one time shall be rendered
against the Company or any of its Subsidiaries and not stayed, bonded or
discharged for a period (during which execution shall not be effectively
stayed) of 60 days (or, in the case of any such final judgment which
provides for payment over time, which shall so remain unstayed, unbonded or
undischarged beyond any applicable payment date provided therein).
SECTION 6.2. ACCELERATION OF MATURITY DATE; RESCISSION AND
ANNULMENT.
If an Event of Default occurs and is continuing (other than an Event
of Default specified in Section 6.1(4) or (6) relating to the Company or its
Significant Subsidiaries) then in every such case, unless the principal of all
of the Securities shall have already become due and payable, either the Trustee
or the Holders of 25% in aggregate principal amount of the Securities
outstanding, by a notice in writing to the Company (and to the Trustee if given
by Holders) (an "Acceleration Notice"), may declare all of the principal and
accrued interest thereon to be due and payable immediately; provided, however,
that if any Senior Debt is outstanding pursuant to the New Credit Facility upon
a declaration of such acceleration, such principal and interest shall be due and
payable upon the earlier of (x) the third Business Day after the sending to the
Company and the Representative of such written notice, unless such Event of
Default is cured or waived prior to such date and (y) the date of acceleration
of any Senior Debt under the New Credit Facility. In the event a declaration of
acceleration resulting from an Event of Default described in Section 6.1(5)
above has occurred and is continuing, such declaration of acceleration shall be
automatically annulled if such default is cured or waived or the holders of the
Indebtedness which is the subject of such default have rescinded their
declaration of acceleration in respect of such Indebtedness within five days
thereof and the Trustee has received written notice or such cure, wavier or
rescission and no other Event of Default described in Section 6.1(5) above has
occurred that has not been cured or waived within five days of the declaration
of such acceleration in respect of such Indebtedness. If an Event of Default
specified in Section 6.1(4) or (6) above, relating to the Company or any
Significant Subsidiary occurs, all principal and accrued interest thereon will
be immediately due and payable on all outstanding Securities without any
declaration or other act on the part of Trustee or the Holders.
At any time after such a declaration of acceleration being made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter provided in this Article VI, the Holders of not less
than a majority in aggregate principal amount of then outstanding Securities, by
written notice to the Company and the Trustee, may rescind, on behalf of all
Holders, any such declaration of acceleration if:
53
(1) the Company has paid or deposited with the Trustee Cash
sufficient to pay
(A) all overdue interest on all
Securities,
(B) the principal of (and premium, if
any, applicable to) any Securities which would become due
other than by reason of such declaration of acceleration,
and interest thereon at the rate borne by the Securities,
(C) to the extent that payment of
such interest is lawful, interest upon overdue interest at
the rate borne by the Securities,
(D) all sums paid or advanced by the
Trustee hereunder and the compensation, expenses,
disbursements and advances of the Trustee and its agents and
counsel, and any other amounts due the Trustee under Section
7.7, and
(2) all Events of Default, other than the non-payment of the
principal of, premium, if any, and interest on Securities which have become
due solely by such declaration of acceleration, have been cured or waived
as provided in Section 6.12, including, if applicable, any Event of Default
relating to the covenants contained in Section 11.1.
Notwithstanding the previous sentence of this Section 6.2, no waiver shall be
effective against any Holder for any Event of Default or event which with notice
or lapse of time or both would be an Event of Default with respect to (i) any
covenant or provision which cannot be modified or amended without the consent of
the Holder of each outstanding Security affected thereby, unless all such
affected Holders agree, in writing, to waive such Event of Default or other
event and (ii) any provision requiring supermajority approval to amend, unless
such default has been waived by such a supermajority. No such waiver shall cure
or waive any subsequent default or impair any right consequent thereon.
54
SECTION 6.3. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT
BY TRUSTEE.
The Company covenants that if an Event of Default in payment of
principal, premium, or interest specified in clause (1) or (2) of Section 6.1
occurs and is continuing, the Company shall, upon demand of the Trustee, pay to
it, for the benefit of the Holders of such Securities, the whole amount then due
and payable on such Securities for principal, premium (if any) and interest,
and, to the extent that payment of such interest shall be legally enforceable,
interest on any overdue principal (and premium, if any) and on any overdue
interest, at the rate borne by the Securities, and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including compensation to, and expenses, disbursements and advances
of the Trustee and its agents and counsel and all other amounts due the Trustee
under Section 7.7.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust in favor of the
Holders, may institute a judicial proceeding for the collection of the sums so
due and unpaid, may prosecute such proceeding to judgment or final decree and
may enforce the same against the Company or any other obligor upon the
Securities and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of the Company or any other obligor
upon the Securities, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effective to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 6.4. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal and premium, if any, or
interest) shall be entitled and empowered, by intervention in such proceeding or
otherwise to take any and all actions under the TIA, including
55
(1) to file and prove a claim for the whole amount of
principal (and premium, if any) and interest owing and unpaid in respect of
the Securities and to file such 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 and its agent and counsel and all
other amounts due the Trustee under Section 7.7) and of the Holders allowed
in such judicial proceeding, and
(2) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official 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 it for the reasonable compensation, expenses,
disbursements and advances of the Trustee and its agents and counsel, and any
other amounts due the Trustee under Section 7.7.
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 Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 6.5. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
SECURITIES.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust in favor of the Holders, and any recovery of
judgment shall, after provision for the payment of compensation to, and
expenses, disbursements and advances of the Trustee, its agents and counsel and
all other amounts due the Trustee under Section 7.7, be for the ratable benefit
of the Holders of the Securities in respect of which such judgment has been
recovered.
SECTION 6.6. PRIORITIES.
Any money collected by the Trustee pursuant to this Article VI shall
be applied in the following order, at the date or dates fixed by the Trustee
and, in case of the distribution of such money on account of principal, premium
(if any) or interest, upon
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presentation of the Securities and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:
FIRST: To the Trustee in payment of all amounts due pursuant to
Section 7.7;
SECOND: To the Holders in payment of the amounts then due and unpaid
for principal of, premium (if any) and interest on, the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due and
payable on such Securities for principal, premium (if any) and interest,
respectively; and
THIRD: To the Company or such other Person as may be lawfully
entitled thereto, the remainder, if any.
The Trustee may, but shall not be obligated to, fix a record date and
payment date for any payment to the Holders under this Section 6.6.
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SECTION 6.7. LIMITATION ON SUITS.
No Holder of any Security shall have any right to order or direct the
Trustee to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(A) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(B) the Holders of not less than 25% in aggregate principal
amount of then outstanding Securities shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(C) such Holder or Holders have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities to be incurred or reasonably probable to be incurred in
compliance with such request;
(D) the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute any such
proceeding; and
(E) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority in aggregate principal amount of the outstanding Securities;
it being understood and intended that no one or more Holders shall have any
right in any manner whatsoever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
SECTION 6.8. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
PREMIUM AND INTEREST.
Notwithstanding any other provision of this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of, and premium (if any) and interest on, such
Security on the Maturity Dates of such payments as expressed in such Security
(in the case of redemption, the Redemption Price on the applicable Redemption
Date, in the case of the Change of Control Payment, on the applicable Change of
Control Payment Date, and in the case of the Asset Sale Offer Price, on the
Purchase Date) and to institute suit for the enforcement of any such payment
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after such respective dates, and such rights shall not be impaired without the
consent of such Holder.
SECTION 6.9. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in Section 2.7, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.10. DELAY OR OMISSION NOT WAIVER.
No delay or omission by the Trustee or by any Holder of any Security
to exercise any right or remedy arising upon any Event of Default shall impair
the exercise of any such right or remedy or constitute a waiver of any such
Event of Default. Every right and remedy given by this Article VI or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
SECTION 6.11. CONTROL BY HOLDERS.
The Holder or Holders of a majority in aggregate principal amount of
then outstanding Securities shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred upon the Trustee, PROVIDED, that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture or involve the Trustee in personal liability,
(2) the Trustee shall not determine that the action so
directed would be unjustly prejudicial to the Holders not taking part in
such direction, and
(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
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SECTION 6.12. WAIVER OF PAST DEFAULT.
Subject to Section 6.8, and prior to the declaration of acceleration
of the maturity of the Securities, the Holder or Holders of not less than a
majority in aggregate principal amount of the outstanding Securities may, on
behalf of all Holders, waive any past default hereunder and its consequences,
except a default
(A) in the payment of the principal of, premium, if any, or
interest on, any Security as specified in clauses (a) and (b) of Section
6.1 and not yet cured,
(B) in respect of a covenant or provision hereof which, under
Article IX, cannot be modified or amended without the consent of the Holder
of each outstanding Security affected, or
(C) in respect of any provision hereof which, under Article IX,
cannot be modified, amended or waived without the consent of the Holders of
a supermajority of the aggregate principal amount of the Securities at the
time outstanding; PROVIDED, that any such waiver may be effected with the
consent of the Holders of a supermajority of the aggregate principal amount
of the Securities then outstanding.
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 the exercise of any right arising therefrom.
SECTION 6.13. UNDERTAKING FOR COSTS.
All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that 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, suffered or omitted to be taken by it
as Trustee, any court may in its discretion require the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such
party litigant; but the provisions of this Section 6.13 shall not apply to any
suit instituted by the Company, to any suit instituted by the Trustee, to any
suit instituted by any Holder, or group of Holders, holding in the aggregate
more than 10% in aggregate principal amount of the outstanding Securities, or to
any suit instituted by any Holder for enforcement of the payment of principal
of, or premium
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(if any) or interest on, any Security on or after the respective Maturity
Date expressed in such Security (including, in the case of redemption, on or
after the Redemption Date).
SECTION 6.14. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every case, subject to any
determination in such proceeding, the Company, the Guarantors, the Trustee and
the Holders shall be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of the Trustee and
the Holders shall continue as though no such proceeding had been instituted.
ARTICLE VII
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture
and covenants and agrees to perform the same, as herein expressed, subject to
the terms hereof.
SECTION 7.1. 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 their exercise as a
prudent Person would exercise or use under the circumstances in the conduct of
his own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties as are
specifically set forth in this Indenture and no others, and no covenants or
obligations shall be implied in or read into this Indenture which are
adverse to the Trustee, and
(2) 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,
in the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall examine the certificates and opinions to determine whether or
not they conform to the requirements of this Indenture.
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(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b)
of this Section 7.1,
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts, and
(3) 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 6.11.
(d) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or to take or omit to take any
action under this Indenture or at the request, order or direction of the Holders
or in the exercise of any of its rights or powers if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b), (c), (d) and (f) of this
Section 7.1.
(f) The Trustee shall not be liable for interest on any assets
received by it except as the Trustee may agree in writing with the Company.
Assets held in trust by the Trustee need not be segregated from other assets
except to the extent required by law.
SECTION 7.2. RIGHTS OF TRUSTEE.
Subject to Section 7.1:
(a) The Trustee may rely on 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
consult with counsel of its selection and may require an Officers' Certificate
or an Opinion of Counsel, which shall conform to Sections 13.4 and 13.5. The
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on such certificate or advice of counsel.
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(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 which it believes to be authorized or within its
rights or powers conferred upon it by this Indenture, nor for any action
permitted to be taken or omitted hereunder by any Agent.
(e) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may
see fit.
(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, order or
direction of any of the Holders, pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
(g) Unless otherwise specifically provided for in this
Indenture, any demand, request, direction or notice from the Company or any
Guarantor shall be sufficient if signed by an Officer of the Company or such
Guarantor, as applicable.
(h) The Trustee shall have no duty to inquire as to the
performance of the Company's or any Guarantor's covenants in Article IV hereof
or as to the performance by any Agent of its duties hereunder. In addition, the
Trustee shall not be deemed to have knowledge of any Default or Event of Default
except any Default or Event of Default of which the Trustee shall have received
written notification or with respect to which a Trust Officer shall have actual
knowledge.
(i) Whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad faith on
its part, rely upon an Officers' Certificate.
SECTION 7.3. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company, any
Guarantor, any of their Subsidiaries, or their respective Affiliates with the
same rights it would have if it were not
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Trustee. Any Agent may do the same with like rights. However, the Trustee
must comply with Sections 7.10 and 7.11.
SECTION 7.4. TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities and it shall not be accountable for the
Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement in the Securities, other than the Trustee's
certificate of authentication (if executed by the Trustee), or the use or
application of any funds received by a Paying Agent other than the Trustee.
SECTION 7.5. NOTICE OF DEFAULT.
If a Default or an Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to each Securityholder notice of
the uncured Default or Event of Default within 90 days after such Default or
Event of Default occurs. Except in the case of a Default or an Event of Default
in payment of principal (or premium, if any) of, or interest on, any Security
(including the payment of the Change of Control Purchase Price on the Change of
Control Payment Date, the payment of the Redemption Price on the Redemption Date
and the payment of the Offer Price on the Purchase Date), the Trustee may
withhold the notice if and so long as a Trust Officer in good faith determines
that withholding the notice is in the interest of the Securityholders.
SECTION 7.6. REPORTS BY TRUSTEE TO HOLDERS.
Within 60 days after each May 15, beginning with the May 15 following
the date of this Indenture, the Trustee shall, if required by law, mail to each
Securityholder a brief report dated as of such May 15 that complies with TIA
Section 313(a). The Trustee also shall comply with TIA Sections 313(b) and
313(c).
The Company shall promptly notify the Trustee in writing if the
Securities become listed on any stock exchange or automatic quotation system and
any delisting thereof.
A copy of each report at the time of its mailing to Securityholders
shall be mailed to the Company and filed with the SEC and each stock exchange,
if any, on which the Securities are listed.
SECTION 7.7. COMPENSATION AND INDEMNITY.
The Company and the Guarantors jointly and severally agree to pay to
the Trustee from time to time such compensation as shall be agreed upon in
writing between the
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Company and the Trustee for its services. The Trustee's compensation shall
not be limited by any law on compensation of a trustee of an express trust.
The Company and the Guarantors shall reimburse the Trustee upon request for
all reasonable out-of-pocket disbursements, expenses and advances incurred or
made by it in accordance with this Indenture. Such expenses shall include
the reasonable compensation, disbursements and expenses of the Trustee's
agents, accountants, experts and counsel.
The Company and the Guarantors jointly and severally agree to
indemnify the Trustee (in its capacity as Trustee) and each of its officers and
each of them, directors, attorneys-in-fact and agents for, and hold it harmless
against, any and all claim, demand, damage, expense (including but not limited
to reasonable compensation, disbursements and expenses of the Trustee's agents
and counsel), loss or liability incurred by it without negligence or bad faith
on the part of the Trustee, arising out of or in connection with the acceptance
or administration of this trust and its rights or duties hereunder including the
reasonable costs and expenses of defending itself against any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder. The Trustee shall notify the Company promptly of any claim asserted
against the Trustee for which it may seek indemnity. The Company and the
Guarantors shall defend the claim and the Trustee shall provide reasonable
cooperation at the Company's and the Guarantors' expense in the defense. The
Trustee may have separate counsel and the Company and the Guarantors shall pay
the reasonable fees and expenses of such counsel. The Company and the
Guarantors need not pay for any settlement made without their written consent.
The Company and the Guarantors need not reimburse any expense or indemnify
against any loss or liability to the extent incurred by the Trustee through its
negligence, bad faith or willful misconduct.
To secure the Company's and the Guarantors' payment obligations in
this Section 7.7, the Trustee shall have a lien prior to the Securities on all
assets held or collected by the Trustee, in its capacity as Trustee, except
assets held in trust to pay principal and premium, if any, of or interest on
particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(4) or (6) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
The Company's and the Guarantors' obligations under this Section 7.7
and any lien arising hereunder shall survive the resignation or removal of the
Trustee, the discharge of the Company's and the Guarantors' obligations pursuant
to Article VIII of this Indenture and any rejection or termination of this
Indenture under any Bankruptcy Law.
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SECTION 7.8. REPLACEMENT OF TRUSTEE.
The Trustee may resign by so notifying the Company in writing. The
Holder or Holders of a majority in aggregate principal amount of the outstanding
Securities may remove the Trustee by so notifying the Company and the Trustee in
writing and may appoint a successor trustee with the Company's consent. The
Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged bankrupt or insolvent;
(c) a receiver, Custodian, or other 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 Holder
or Holders of a majority in aggregate principal amount of the Securities may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that
and provided that all sums owing to the retiring Trustee provided for in Section
7.7 have been paid, the retiring Trustee shall transfer all property held by it
as trustee to the successor Trustee, subject to the lien provided in Section
7.7, 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. A successor Trustee shall mail notice of its
succession to each Holder.
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
Holder or Holders of at least 10% in aggregate principal amount of the
outstanding Securities may petition, at the expense of the Company, any court of
competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
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Notwithstanding replacement of the Trustee pursuant to this Section
7.8, the Company and the Guarantors' obligations under Section 7.7 shall
continue for the benefit of the retiring Trustee.
SECTION 7.9. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
The Trustee shall at all times satisfy the requirements of TIA Section
310(a)(1), (2) and (5). The Trustee shall have a combined capital and surplus
of at least $25,000,000 as set forth in its most recent published annual report
of condition. The Trustee shall comply with TIA Section 310(b).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE
COMPANY.
The Trustee shall comply with 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.
ARTICLE VIII
DISCHARGE; LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.1. DISCHARGE; OPTION TO EFFECT LEGAL DEFEASANCE OR
COVENANT DEFEASANCE.
This Indenture shall cease to be of further effect (except that the
Company's and the Guarantors' obligations under Section 7.7 and the Trustee's
and the Paying Agent's obligations under Sections 8.6 and 8.7 shall survive)
when all outstanding Securities theretofore authenticated and issued have been
delivered (other than destroyed, lost or stolen Securities that have been
replaced or paid) to the Trustee for cancellation and the Company or the
Guarantors have paid all sums payable hereunder. In addition, the Company may,
at its option and at any time, elect to have Section 8.2 or may, at any time,
elect to have Section 8.3 applied to all outstanding Securities upon compliance
with the conditions set forth below in this Article VIII.
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SECTION 8.2. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.1 of the option applicable
to this Section 8.2, the Company and the Guarantors shall be deemed to have been
discharged from their respective obligations with respect to all outstanding
Securities on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, such Legal Defeasance
means that the Company shall be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Securities, which shall thereafter
be deemed to be "outstanding" only for the purposes of Section 8.5 and the other
Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all its other obligations under such Securities 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 which shall
survive until otherwise terminated or discharged hereunder: (a) the rights of
Holders of outstanding Securities to receive solely from the trust fund
described in Section 8.4, and as more fully set forth in such section, payments
in respect of the principal of, premium, if any, and interest on such Securities
when such payments are due, (b) the Company's obligations with respect to such
Securities under Sections 2.4, 2.6, 2.7, 2.10 and 4.2, (c) the rights, powers,
trusts, duties and immunities of the Trustee hereunder and the Company's and the
Guarantors' obligation in connection therewith and (d) this Article VIII. Upon
Legal Defeasance as provided herein, the Guaranty of each Guarantor shall be
fully released and discharged and the Trustee shall promptly execute and deliver
to the Company any documents reasonably requested by the Company to evidence or
effect the foregoing. Subject to compliance with this Article VIII, the Company
may exercise its option under this Section 8.2 notwithstanding the prior
exercise of its option under Section 8.3 with respect to the Securities.
SECTION 8.3. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.1 of the option applicable
to this Section 8.3, the Company and the Guarantors shall be released from their
respective obligations under the covenants contained in Sections 4.3, 4.5, 4.6,
4.7, 4.8, 4.9, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16 and 4.17, Article V,
Article XI and Article XII with respect to the outstanding Securities on and
after the date the conditions set forth below are satisfied (hereinafter,
"Covenant Defeasance"), and the Securities 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. For this purpose, such Covenant Defeasance means that, with respect
to the outstanding Securities, the Company need not 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
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covenant to any other provision herein or in any other document (and Section
6.1(3) shall not apply to any such covenant), but, except as specified above,
the remainder of this Indenture and such Securities shall be unaffected thereby.
In addition, upon the Company's exercise under Section 8.1 of the option
applicable to this Section 8.3, Sections 6.1(3) through 6.1(7) shall not
constitute Events of Default. Upon Covenant Defeasance, as provided herein, the
Guaranty of each Guarantor shall be fully released and discharged and the
Trustee shall promptly execute and deliver to the Company any documents
reasonably requested by the Company to evidence or effect the foregoing.
SECTION 8.4. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.2 or Section 8.3 to the outstanding Securities:
(a) The Company shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee satisfactory to the Trustee
satisfying the requirements of Section 7.10 who shall agree to comply with the
provisions of this Article VIII applicable to it) as trust funds in trust for
the purpose of making the following payments, specifically pledged as security
for, and dedicated solely to, the benefit of the Holders of such Securities, (a)
Cash in an amount, or (b) U.S. Government Obligations which through the
scheduled payment of principal and interest in respect thereof in accordance
with their terms will provide, not later than one day before the due date of any
payment, Cash in an amount, or (c) a combination thereof, in such amounts, as in
each case will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge and which shall be applied by the
Paying Agent (or other qualifying trustee) to pay and discharge the principal
of, premium, if any, and interest on the outstanding Securities on the Stated
Maturity or on the applicable Redemption Date, as the case may be, of such
principal or installment of principal, premium, if any, or interest; PROVIDED
that the Paying Agent shall have been irrevocably instructed to apply such Cash
and the proceeds of such U.S. Government Obligations to said payments with
respect to the Securities. The Paying Agent shall promptly advise the Trustee
in writing of any Cash or U.S. Government Obligations deposited pursuant to this
Section 8.4;
(b) In the case of an election under Section 8.2, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that (i) the Company have
received from, or there has been published by, the Internal Revenue Service a
ruling or (ii) 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 shall confirm that, the Holders of the outstanding
Securities will not recognize income, gain or loss for Federal income tax
purposes as a result of such Legal Defeasance and will be subject to Federal
income tax on
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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 8.3, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
to the effect that the Holders of the outstanding Securities 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 in the same
amount, 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 with respect to the
Securities shall have occurred and be continuing on the date of such deposit or,
in so far as Section 6.1(4) or Section 6.1(6) is concerned, at any time in the
period ending on the 91st day after the date of such deposit (it being
understood that this condition is a condition subsequent which shall not be
deemed satisfied until the expiration of such period, but in the case of
Covenant Defeasance, the covenants which are defeased under Section 8.3 will
cease to be in effect unless an Event of Default under Section 6.1(4) or Section
6.1(6) occurs during such period);
(e) Such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under, this
Indenture or any other material agreement or instrument to which the Company,
the Guarantors, or any of their Subsidiaries is a party or by which any of them
is bound;
(f) In the case of an election under either Section 8.2 or
8.3, the Company shall have delivered to the Trustee an Officers' Certificate
stating that the deposit made by the Company pursuant to its election under
Section 8.2 or 8.3 was not made by the Company with the intent of preferring the
Holders over other creditors of the Company or with the intent of defeating,
hindering, delaying or defrauding creditors of the Company or others;
(g) The Company shall have delivered to the Trustee an
Officers' Certificate stating that the conditions precedent provided for have
been complied with; and
(h) The Company shall have delivered to the Trustee an Opinion
of Counsel stating that the conditions set out in Section 8.4(a)(with respect to
the validity and perfection of the security interest), (b), (c) and (e) above.
(i) The Company or the Parent Guarantor shall have delivered
to the Trustee any required consent of the lenders under the Credit Facility to
such defeasance or covenant defeasance, as the case may be.
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SECTION 8.5. DEPOSITED CASH AND U.S. GOVERNMENT OBLIGATIONS TO BE
HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.6, all Cash and U.S. Government Obligations
(including the proceeds thereof) deposited with the Paying Agent (or other
qualifying trustee, collectively for purposes of this Section 8.5, the "Paying
Agent") pursuant to Section 8.4 in respect of the outstanding Securities shall
be held in trust and applied by the Paying Agent, in accordance with the
provisions of such Securities and this Indenture, to the payment, either
directly or through any other Paying Agent as the Trustee may determine, to the
Holders of such Securities of all sums due and to become due thereon in respect
of principal, premium, 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 U.S. Government Obligations
deposited pursuant to Section 8.4 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 Outstanding Securities.
SECTION 8.6. REPAYMENT TO THE COMPANY.
Anything in this Article VIII to the contrary notwithstanding, the
Trustee or the Paying Agent shall deliver or pay to the Company from time to
time upon the written request of the Company any Cash or U.S. Government
Obligations held by it as provided in Section 8.4 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 8.4(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.
Any Cash and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of, premium, if any, or
interest on any Security and remaining unclaimed for two years after such
principal, and premium, if any, or interest has become due and payable shall be
paid to the Company on its request; and the Holder of such Security 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 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 (i) be published once, in the NEW YORK TIMES and THE WALL
STREET JOURNAL (national edition), or (ii) mail to each such Holder, notice that
such money remains unclaimed and that, after a date specified therein, which
shall
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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 8.7. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any Cash or U.S.
Government Obligations in accordance with Section 8.2 or 8.3, 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 and the Guarantors' obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 8.2 or 8.3 until such time as the Trustee or Paying Agent is
permitted to apply such money in accordance with Section 8.2 and 8.3, as the
case may be; PROVIDED, HOWEVER, that, if the Company makes any payment of
principal of, premium, if any, or interest on any Security following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Securities to receive such payment from the Cash and U.S.
Government Obligations held by the Trustee or Paying Agent.
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.1. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holder, the Company or any Guarantor, when
authorized by Board Resolutions, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:
(1) to cure any ambiguity, defect, or inconsistency, or make
any other provisions with respect to matters or questions arising under
this Indenture which shall not be inconsistent with the provisions of this
Indenture, provided such action pursuant to this clause shall not adversely
affect the interests of any Holder in any respect;
(2) to add to the covenants of the Company or the Guarantors
for the benefit of the Holders, or to surrender any right or power herein
conferred upon the Company or the Guarantors;
(3) to provide for additional collateral for or additional
Guarantors of the Securities;
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(4) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the obligations of the
Company, herein and in the Securities in accordance with Article V;
(5) to comply with the TIA;
(6) to evidence the succession of another corporation to any
Guarantor and assumption by any such successor of the Guaranty of such
Guarantor (as set forth in Section 12.4) in accordance with Article XIII;
(7) to evidence the release of any Guarantor in accordance
with Article XII;
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities; or
SECTION 9.2. AMENDMENTS, SUPPLEMENTAL INDENTURES AND WAIVERS WITH
CONSENT OF HOLDERS.
Subject to Section 6.8, with the consent of the Holders of not less
than a majority in aggregate principal amount of then outstanding Securities,
by written act of said Holders delivered to the Company and the Trustee, the
Company or any Guarantor, when authorized by Board Resolutions, and the
Trustee may amend or supplement this Indenture or the Securities or enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or the Securities or of modifying in any manner
the rights of the Holders under this Indenture or the Securities. Subject to
Section 6.8, the Holder or Holders of not less than a majority in aggregate
principal amount of then outstanding Securities may waive compliance by the
Company or any Guarantor with any provision of this Indenture or the
Securities. Notwithstanding any of the above, however, no such amendment,
supplemental indenture or waiver shall without the consent of the Holders of
not less than 75% of the aggregate principal amounts of Securities at the
time outstanding alter the terms or provisions of Section 11.1 or Section
11.2 in a manner adverse to the Holders; and no such amendment, supplemental
indenture or waiver shall, without the consent of the Holder of each
outstanding Security affected thereby:
(1) change the Stated Maturity on any Security, or reduce the
principal amount thereof or the rate (or extend the time for payment) of
interest thereon or any premium payable upon the redemption thereof, or
change the place of payment where, or the coin or currency in which, any
Security or any premium or the interest thereon is payable, or impair the
right to institute suit for the enforcement of any such payment on or after
the Stated Maturity thereof (or in the case of
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redemption, on or after the Redemption Date), or reduce the Change of
Control Purchase Price or the Asset Sale Offer Price or alter the
provisions (including the defined terms used herein) regarding the right
of the Company to redeem the Securities in a manner adverse the Holders; or
(2) reduce the percentage in principal amount of the
outstanding Securities, the consent of whose Holders is required for any
such amendment, supplemental indenture or wavier provided for in this
Indenture; or
(3) modify any of the waiver provisions, except to increase
any required percentage or to provide that certain other provision of this
Indenture cannot be modified or waived without the consent of the Holder of
each outstanding Note affected thereby.
Notwithstanding any of the above, however, no such amendment,
supplemental indenture or waiver shall without the consent of the Representative
on behalf of the Required Lenders amend, waive or otherwise modify the terms or
provisions of Article X in a manner adverse to the Lenders (as defined in the
New Credit Facility).
It shall not be necessary for the consent of the Holders under this
Section 9.2 to approve the particular form of any proposed amendment, supplement
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 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 supplemental indenture or waiver.
After an amendment, supplement or waiver under this Section 9.2 or
Section 9.4 becomes effective, it shall bind each Holder.
In connection with any amendment, supplement or waiver under this
Article IX, the Company may, but shall not be obligated to, offer to any Holder
who consents to such amendment, supplement or waiver, or to all Holders,
consideration for such Holder's consent to such amendment, supplement or waiver.
SECTION 9.3. COMPLIANCE WITH TIA.
Every amendment, waiver or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
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SECTION 9.4. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of his Security by written notice to the
Company or the Person designated by the Company as the Person to whom consents
should be sent if such revocation is received by the Company or such Person
before the date on which the Trustee receives an Officers' Certificate
certifying that the Holders of the requisite principal amount of Securities have
consented (and not theretofore revoked such consent) to the amendment,
supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which record date shall be the date so fixed by the
Company notwithstanding the provisions of the TIA. If a record date is fixed,
then notwithstanding the last sentence of the immediately preceding paragraph,
those Persons who were Holders at such record date, and only those Persons (or
their duly designated proxies), shall be entitled to revoke any consent
previously given, whether or not such Persons continue to be Holders after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(1) through (3) of Section 9.2, in which case, the amendment, supplement or
waiver shall bind only each Holder of a Security who has consented to it and
every subsequent Holder of a Security or portion of a Security that evidences
the same debt as the consenting Holder's Security; PROVIDED, that any such
waiver shall not impair or affect the right of any Holder to receive payment of
principal and premium of and interest on a Security, on or after the respective
dates set for such amounts to become due and payable expressed in such Security,
or to bring suit for the enforcement of any such payment on or after such
respective dates.
SECTION 9.5. NOTATION ON OR EXCHANGE OF SECURITIES.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the
Registrar or require the Holder to put an appropriate notation on the Security.
The Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Security shall issue and the
Trustee shall authenticate a new Security that reflects the changed terms. Any
75
failure to make the appropriate notation or to issue a new Security shall not
affect the validity of such amendment, supplement or waiver.
SECTION 9.6. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article IX; PROVIDED, that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
any amendment, supplement or waiver authorized pursuant to this Article IX is
authorized or permitted by this Indenture.
ARTICLE X
SUBORDINATION
SECTION 10.1. SECURITIES SUBORDINATED TO SENIOR DEBT.
The Company and the Guarantors and each Holder, by its acceptance of
Securities, agree that (a) the payment of the principal of and interest on the
Securities and (b) any other payment in respect of the Securities, including on
account of the acquisition or redemption of the Securities by the Company or the
Guarantors (including, without limitation, pursuant to Article III or Section
4.1, 4.14, 11.1, 11.2 or Article XII is expressly made and shall be subordinated
in right of payment, to the extent and in the manner provided in this Article X,
to the prior payment in full in Cash of all existing and future Senior Debt of
the Company and the Guarantors and that these subordination provisions are for
the benefit of the holders of Senior Debt.
This Article X shall constitute a continuing offer to all Persons who,
in reliance upon such provisions, become holders of, or continue to hold, Senior
Debt, and such provisions are made for the benefit of the holders of Senior
Debt, and such holders are made obligees hereunder and any one or more of them
may enforce such provisions.
SECTION 10.2. NO PAYMENT ON SECURITIES IN CERTAIN CIRCUMSTANCES.
(a) No payment (including any payment which may be payable to
any Holder by reason of the subordination of any other indebtedness or other
obligations to, or guarantee of, the Securities) or distribution (by set-off or
otherwise) shall be made by or on behalf of the Company or a Guarantor, as
applicable, on account of the Securities, including the principal of, premium,
if any, or interest on the Securities (including any repurchases of Securities)
or any other amounts with respect thereto or on account of the
76
redemption provisions of the Securities for cash or property (other than
Junior Securities), (i) upon the maturity of any Senior Debt of the Company
or such Guarantor by lapse of time, acceleration (unless waived) or
otherwise, unless and until all principal of, premium, if any, and the
interest on, and all other amounts with respect to, such Senior Debt shall
first be paid in full in Cash or otherwise to the extent each of the holders
of Senior Debt accept satisfaction of amounts due to such holder by
settlement in other than Cash, or (ii) in the event of default in payment of
any principal of, or premium, if any, or interest on, or any other amounts
with respect to, Senior Debt of the Company or such Guarantor when the same
becomes due and payable, whether at maturity or at a date fixed for
prepayment or by declaration or otherwise (each of the foregoing, a "Payment
Default") unless and until such Payment Default has been cured or waived or
otherwise has ceased to exist.
(b) Upon (i) the happening of a default (other than a Payment
Default) that permits the holders of Senior Debt (or a percentage thereof) to
declare such Senior Debt to be due and payable and (ii) written notice of such
default given to the Company and the Trustee by the Representative under the
Credit Facility or by the holders of an aggregate of at least $25.0 million
principal amount outstanding of any other Senior Debt or their representative at
such holders' direction (a "Payment Notice"), then, unless and until such
default has been cured or waived or otherwise has ceased to exist, no payment
(including any payment which may be payable to any Holder by reason of the
subordination of any other indebtedness or other obligations to, or guarantee
of, the Securities) or distribution (by set-off or otherwise) may be made by or
on behalf of the Company or any Guarantor which is an obligor under such Senior
Debt on account of the principal of, premium, if any, or interest on the
Securities (including any repurchases of any of the Securities), or any other
amount with respect thereto, or on account of the redemption provision of the
Securities, in any such case, other than payments made with Junior Securities.
Notwithstanding the foregoing, unless the Senior Debt in respect of which such
default exists has been declared due and payable in its entirety within 179 days
after the Payment Notice is delivered as set forth above (such period being
hereinafter referred to as the "Payment Blockage Period") (and such declaration
has not been rescinded or waived), at the end of the Payment Blockage Period
(and assuming that no Payment Default Exists), unless Section 10.3 shall be
applicable the Company and the Guarantors shall not be prohibited by the
subordination provisions from paying all sums then due and not paid to the
Holders of the Securities during the Payment Blockage Period due to the
foregoing prohibitions and to resume all other payments as and when due on the
Securities. Any number of Payment Notices may be given; PROVIDED, HOWEVER; that
(i) not more than one Payment Notice shall be given within a period of any 360
consecutive days, and (ii) no default that existed upon the date of delivery of
such Payment Notice (whether or not such event of default is on the same issue
of Senior Debt) shall be made the basis for the commencement of any other
Payment Blockage Period.
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(c) In furtherance of the provisions of Section 10.1, in
the event that, notwithstanding the foregoing provisions of this Section
10.2, any payment or distribution of assets in respect of the Securities,
including principal of or interest on the Securities or to defease or acquire
any of the Securities (including repurchases of Securities pursuant to
Section 4.14, 11.1 or 11.2) for Cash, property or securities (excluding
payments made with Junior Securities), or on account of the redemption
provisions of the Securities, shall be made by the Company or any of the
Guarantors and received by the Trustee, by any Holder or by any Paying Agent
(or, if the Company is acting as the Paying Agent, money for any such payment
shall be segregated and held in trust), at a time when such payment or
distribution was prohibited by the provisions of this Section 10.2, then,
unless such payment or distribution is no longer prohibited by this Section
10.2, such payment or distribution (subject to the provisions of Section
10.7) shall be received and held in trust by the Trustee or such Holder or
Paying Agent for the benefit of the holders of Senior Debt of the Company or
such Guarantor, and shall be paid or delivered by the Trustee or such Holders
or such Paying Agent, as the case may be, to the holders of Senior Debt of
the Company or such Guarantor remaining unpaid or their representative or
representatives, or to the trustee or trustees under any indenture pursuant
to which any instruments evidencing such Senior Debt of the Company or such
Guarantor may have been issued, ratably according to the aggregate amounts
unpaid on account of such Senior Debt held or represented by each, for
application to the payment of all Senior Debt in full in Cash or otherwise to
the extent each of the holders of such Senior Debt accept satisfaction of
amounts due by settlement in other than Cash after giving effect to all
concurrent payments and distributions to or for the holders of such Senior
Debt.
SECTION 10.3. SECURITIES SUBORDINATED TO PRIOR PAYMENT OF ALL
SENIOR DEBT ON DISSOLUTION, LIQUIDATION OR REORGANIZATION.
Upon any distribution of assets of the Company or any Guarantor or
upon any dissolution, winding up, total or partial liquidation or
reorganization of the Company or any Guarantor, whether voluntary or
involuntary, in bankruptcy, insolvency, receivership or a similar proceeding
or upon assignment for the benefit of creditors or any marshalling of assets
or liabilities:
(a) the holders of all Senior Debt of the Company or such
Guarantor, as applicable, shall first be entitled to receive payments in full
of all amounts of Senior Debt in Cash or otherwise to the extent each of such
holders accepts satisfaction of amounts due by settlement in other than Cash
or before the Holders are entitled to receive any payment (including any
payment which may be payable to any Holder by reason of the subordination of
any other indebtedness or other obligations to, or guarantee of, the
Securities) or distribution on account of the principal of, premium, if any,
and any interest on, or other amounts with respect to, the Securities (other
than Junior Securities);
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(b) any payment or distribution of assets of the Company or
such Guarantor of any kind or character from any source, whether in cash,
property or securities (other than Junior Securities), to which the Holders
or the Trustee on behalf of the Holders would be entitled (by set-off or
otherwise) except for the provisions of this Article X, shall be paid by the
liquidating Trustee or agent or other person making such a payment or
distribution, directly to the holders of such Senior Debt or their
representative to the extent necessary to make payment in full on all such
Senior Debt remaining unpaid, after giving effect to all concurrent payments
or distributions to the holders of such Senior Debt; and
(c) in the event that, notwithstanding the foregoing, any
payment or distribution of assets of the Company or any Guarantor (other than
the Junior Securities), shall be received by the Trustee or the Holders at a
time when such payment or distribution shall be prohibited by the foregoing
provisions, such payment or distribution shall be held in trust for the
benefit of the holders of such Senior Debt, and shall be paid or delivered by
the Trustee or such Holders, as the case may be, to the holders of such
Senior Debt remaining unpaid or to their representative or representatives,
or to the trustee or trustees under any indenture pursuant to which any
instruments evidencing any of such Senior Debt held or represented by each,
for application to the payment of all such Senior Debt may have been issued,
ratably according to the aggregate principal amounts remaining unpaid on
account of such Senior Debt remaining unpaid, to the extent necessary to pay
all such Senior Debt in full in Cash or otherwise to the extent each of the
holders of such Senior Debt accept satisfaction of amounts due by settlement
in other than Cash after giving effect to any concurrent payment or
distribution to the holders of such Senior Debt.
SECTION 10.4. SECURITYHOLDERS TO BE SUBROGATED TO RIGHTS OF HOLDERS
OF SENIOR DEBT.
Subject to the payment in full in Cash of all Senior Debt of the
Company or any Guarantor as provided herein, the Holders of Securities shall
be subrogated to the rights of the holders of such Senior Debt to receive
payments or distributions of assets of the Company applicable to the Senior
Debt until all amounts owing on the Securities shall be paid in full, and for
the purpose of such subrogation no such payments or distributions to the
holders of such Senior Debt by or on behalf of the Company or any Guarantor,
or by or on behalf of the Holders by virtue of this Article X, which
otherwise would have been made to the Holders shall, as between the Company
or any Guarantor and the Holders, be deemed to be payment by the Company or
any Guarantor or on account of such Senior Debt, it being understood that the
provisions of this Article X are and are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand, and the holders
of such Senior Debt, on the other hand.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article X shall have been
applied, pursuant to the
79
provisions of this Article X, to the payment of amounts payable under Senior
Debt of the Company or any Guarantor, then the Holders shall be entitled to
receive from the holders of such Senior Debt any payments or distributions
received by such holders of Senior Debt in excess of the amount sufficient to
pay all amounts payable under or in respect of such Senior Debt in full in
Cash or otherwise to the extent each of such holders accepts satisfaction of
amounts due by settlement in other than Cash.
SECTION 10.5. OBLIGATIONS OF THE COMPANY AND THE GUARANTORS
UNCONDITIONAL.
Nothing contained in this Article X or elsewhere in this Indenture
or in the Securities is intended to or shall impair, as between the Company
and any Guarantors and the Holders, the obligation of each such Person, which
is absolute and unconditional, to pay to the Holders the principal of,
premium, if any, and interest on the Securities as and when the same shall
become due and payable in accordance with their terms, or is intended to or
shall affect the relative rights of the Holders and creditors of the Company
and the Guarantors other than the holders of the Senior Debt, nor shall
anything herein or therein prevent the Trustee or any Holder from exercising
all remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article X, of the
holders of Senior Debt in respect of Cash, property or securities of the
Company and the Guarantors received upon the exercise of any such remedy.
Notwithstanding anything to the contrary in this Article X or elsewhere in
this Indenture or in the Securities, upon any distribution of assets of the
Company and the Guarantors referred to in this Article X, the Trustee,
subject to the provisions of Sections 7.1 and 7.2, and the Holders shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction in which such dissolution, winding up, liquidation or
reorganization proceedings are pending, or a certificate of the liquidating
Trustee or agent or other Person making any distribution to the Trustee or to
the Holders for the purpose of ascertaining the Persons entitled to
participate in such distribution, the holders of the Senior Debt and other
Indebtedness of the Company or any Guarantor, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article X so long as such court has been
apprised of the provisions of, or the order, decree or certificate makes
reference to, the provisions of this Article X. Nothing in this Section 10.5
shall apply to the claims of, or payments to, the Trustee under or pursuant
to Section 7.7.
Subject to the provisions of Section 7.1, the Trustee shall be
entitled to rely on the delivery to it of a written notice by a person
representing himself to be a holder of Senior Debt (or a trustee or agent on
behalf of such holder) to establish that such notice has been given by a
holder of Senior Debt (or a trustee or agent on behalf of any such holder).
In the event that the Trustee determines in good faith that further evidence
is required with respect to the right of a person as a holder of Senior Debt
to participate in any payment or
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distribution pursuant to this Article X, the Trustee may request such person
to furnish evidence to the reasonable satisfaction of the Trustee as to the
amount of Senior Debt held by such person, the extent to which such person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such person under this Article X, and if such
evidence is not furnished, the Trustee may defer any payment which it may be
required to make for the benefit of such person pursuant to the terms of this
Indenture pending judicial determination as to the rights of such person to
receive such payment.
SECTION 10.6. TRUSTEE ENTITLED TO ASSUME PAYMENTS NOT PROHIBITED
IN ABSENCE OF NOTICE.
The Trustee shall not at any time be charged with knowledge of the
existence of any facts which would prohibit the making of any payment to or
by the Trustee unless and until the Trustee or any Paying Agent shall have
received, no later than one Business Day prior to such payment, written
notice thereof from the Company or from one or more holders of Senior Debt or
from any representative therefor and, prior to the receipt of any such
written notice, the Trustee, subject to the provisions of Sections 7.1 and
7.2, shall be entitled in all respects conclusively to assume that no such
fact exists.
SECTION 10.7. APPLICATION BY TRUSTEE OF ASSETS DEPOSITED WITH IT.
Amounts deposited in trust with the Trustee pursuant to and in
accordance with Article VIII shall be for the sole benefit of Securityholders
and, to the extent (i) the making of such deposit by the Company shall not be
in contravention of any term or provision of the Credit Facility and (ii)
allocated for the payment of Securities, shall not be subject to the
subordination provisions of this Article X. Otherwise, any deposit of assets
with the Trustee or the Agent (whether or not in trust) for the payment of
principal of or interest on any Securities shall be subject to the provisions
of Sections 10.1, 10.2, 10.3 and 10.4.
SECTION 10.8. SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR
OMISSIONS OF THE COMPANY, THE GUARANTORS OR HOLDERS OF SENIOR DEBT.
No right of any present or future holders of any Senior Debt to
enforce subordination provisions contained in this Article X shall at any
time in any way be prejudiced or impaired by any act or failure to act on the
part of the Company or any Guarantor or by any act or failure to act, in good
faith, by any such holder, or by any noncompliance by the Company or any
Guarantor with the terms of this Indenture, regardless of any knowledge
thereof which any such holder may have or be otherwise charged with. The
holders of Senior Debt may at any time and from time to time without the
consent of or notice to the Trustee or the Holders of the Securities without
incurring any responsibility to the Holders extend, renew, modify or amend
the terms of the Senior Debt or any security
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therefor and release, sell or exchange such security and otherwise deal
freely with the Company and the Guarantors and any person liable in any
manner for the collection of Senior Debt, all without affecting the
subordination provisions or liabilities or obligations of the parties to this
Indenture or the Holders or to the holders of the Senior Debt.
SECTION 10.9. SECURITYHOLDERS AUTHORIZE TRUSTEE TO EFFECTUATE
SUBORDINATION OF SECURITIES.
Each Holder of the Securities by his acceptance thereof authorizes
and expressly directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provisions contained
in this Article X and to protect the rights of the Holders pursuant to this
Indenture, and appoints the Trustee his attorney-in-fact for such purpose,
including, in the event of any dissolution, winding up, liquidation or
reorganization of the Company or any Guarantor (whether in bankruptcy,
insolvency or receivership proceedings or upon an assignment for the benefit
of creditors or any other marshalling of assets and liabilities of the
Company or any Guarantor), the immediate filing of a claim for the unpaid
balance of his Securities in the form required in said proceedings and cause
said claim to be approved. If the Trustee does not file a proper claim or
proof of debt in the form required in such proceeding prior to 30 days before
the expiration of the time to file such claim or claims, then the holders of
the Senior Debt or their representative are or is hereby authorized to have
the right to file and are or is hereby authorized to file an appropriate
claim for and on behalf of the Holders of said Securities. Nothing herein
contained shall be deemed to authorize the Trustee or the holders of Senior
Debt or their representative to authorize or consent to or accept or adopt on
behalf of any Securityholder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any
Holder thereof, or to authorize the Trustee or the holders of Senior Debt or
their representative to vote in respect of the claim of any Securityholder in
any such proceeding.
SECTION 10.10. RIGHT OF TRUSTEE TO HOLD SENIOR DEBT.
The Trustee shall be entitled to all of the rights set forth in
this Article X in respect of any Senior Debt at any time held by it to the
same extent as any other holder of Senior Debt, and nothing in this Indenture
shall be construed to deprive the Trustee of any of its rights as such holder.
SECTION 10.11. ARTICLE X NOT TO PREVENT EVENTS OF DEFAULT.
The failure to make a payment on account of principal of, premium,
if any, or interest on the Securities by reason of any provision of this
Article X shall not be construed as preventing the occurrence of a Default or
an Event of Default under Section 6.1
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or in any way prevent the Holders from exercising any right hereunder other
than the right to receive payment on the Securities.
SECTION 10.12. NO FIDUCIARY DUTY OF TRUSTEE TO HOLDERS OF SENIOR
DEBT.
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt, and shall not be liable to any such holders (other
than for its willful misconduct or negligence) if it shall in good faith
mistakenly pay over or distribute to the Holders of Securities or the
Company, any Guarantor or any other Person, cash, property or securities to
which any holders of Senior Debt shall be entitled by virtue of this Article
X or otherwise. Nothing in this Section 10.12 shall affect the obligation of
any other such Person to hold such payment for the benefit of, and to pay
such payment over to, the holders of Senior Debt or their representative.
With respect to the holders of Senior Debt, the Trustee undertakes to perform
or to observe only such of its covenants or obligations as are specifically
set forth in this Article X and no implied covenants or obligations with
respect to holders of Senior Debt shall be read into this Indenture against
the Trustee.
ARTICLE XI
68 RIGHT TO REQUIRE REPURCHASE
SECTION 11.1. REPURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON
A CHANGE OF CONTROL.
(a) In the event that a Change of Control has occurred, each
Holder shall have the right, at such Holder's option, pursuant to an irrevocable
and unconditional offer by the Company (the "Change of Control Offer"), to
require the Company to repurchase all or any part of such Holder's Securities
(PROVIDED, that the principal amount of such Securities at maturity must be
$1,000 or an integral multiple thereof) on a date (the "Change of Control
Purchase Date") that is no later than 35 Business Days after the Occurrence of
such Change of Control, at a cash price (the "Change of Control Purchase Price")
equal to 101% of the principal amount thereof, together with accrued and unpaid
interest, if any, to the Change of Control Purchase Date.
(b) In the event of a Change of Control, the Company shall be
required to commence a Change of Control Offer as follows:
(1) the Change of Control Offer shall commence within 10
Business Days following the occurrence of the Change of Control;
(2) the Change of Control Offer shall remain open for 20
Business Days, except to the extent that a longer period is required by
applicable law, but in
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any case not more than 35 Business Days following commencement (the "Change
of Control Offer Period");
(3) upon the expiration of a Change of Control Offer, the
Company shall promptly purchase all of the properly tendered Securities at
the Change of Control Purchase Price;
(4) if the Change of Control Payment Date is on or after a
Record Date and on or before the related interest payment date, any accrued
interest will be paid to the Person in whose name a Security is registered
at the close of business on such Record Date, and no additional interest
will be payable to Securityholders who tender Securities pursuant to the
Change of Control Offer;
(5) the Company shall provide the Trustee and the Paying Agent
with notice of the Change of Control Offer at least three Business Days
before the commencement of any Change of Control Offer; and
(6) on or before the commencement of any Change of Control
Offer, the Company or the Registrar (upon the request and at the expense of
the Company) shall send, by first-class mail, a notice to each of the
Securityholders, which (to the extent consistent with this Indenture) shall
govern the terms of the Change of Control Offer and shall state:
(i) the Change of Control Offer is being made
pursuant to such notice and this Section 11.1 and that all Securities, or
portions thereof, tendered will be accepted for payment;
(ii) the Change of Control Purchase Price (including
the amount of accrued and unpaid interest, subject to clause (b)(4) above),
the Change of Control Purchase Date and the Change of Control Put Date (as
defined below);
(iii) that any Security, or portion thereof, not
tendered or accepted for payment will continue to accrue interest;
(iv) that, unless the Company defaults in depositing
Cash with the Paying Agent in accordance with the last paragraph of this
Section 11.1 or such payment is prevented, any Security, or portion
thereof, accepted for payment pursuant to the Change of Control Offer shall
cease to accrue interest after the Change of Control Purchase Date;
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(v) that Holders electing to have a Security, or
portion thereof, purchased pursuant to a Change of Control Offer will be
required to surrender the Security, with the form entitled "Option of
Holder to Elect Purchase" on the reverse of the Security completed, to the
Paying Agent (which may not for purposes of this Section 11.1,
notwithstanding anything in this Indenture to the contrary, be the Company
or any Affiliate of the Company) at the address specified in the notice
prior to the close of business on the earlier of (a) the third Business Day
prior to the Change of Control Payment Date and (b) the third Business Day
following the expiration of the Change of Control Offer (such earlier date
being the "Change of Control Put Date");
(vi) that Holders will be entitled to withdraw their
election, in whole or in part, if the Paying Agent (which may not for
purposes of this Section 11.1, notwithstanding anything in this Indenture
to the contrary, be the Company or any Affiliate of the Company) receives,
up to the close of business on the Change of Control Put Date, a facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Securities the Holder is withdrawing and a statement that
such Holder is withdrawing his election to have such principal amount of
Securities purchased; and
(vii) a brief description of the events resulting in
such Change of Control.
Any such Change of Control Offer shall comply with all applicable
provisions of Federal and state laws, including those regulating tender offers,
if applicable, and any provisions of this Indenture which conflict with such
laws shall be deemed to be superseded by the provisions of such laws.
On or before the Change of Control Purchase Date, the Company shall
(i) accept for payment Securities or portions thereof properly tendered pursuant
to the Change of Control Offer on or before the Change of Control Put Date, (ii)
deposit with the Paying Agent Cash sufficient to pay the Change of Control
Purchase Price for all Securities or portions thereof so tendered and (iii)
deliver to the Registrar Securities so accepted together with an Officers'
Certificate listing the aggregate principal amount of the Securities or portions
thereof being purchased by the Company. The Paying Agent shall on the Change of
Control Purchase Date or promptly thereafter mail to Holders of Securities so
accepted payment in an amount equal to the Change of Control Purchase Price for
such Securities, and the Trustee or its authenticating agent shall promptly
authenticate and the Registrar shall mail or deliver (or cause to be transferred
by book entry) to such Holders a new Security equal in principal amount to any
unpurchased portion of the Security surrendered; provided, however, that each
such new Security will be in a principal amount of $1,000 or an integral
multiple thereof. Any Securities not so accepted shall be promptly mailed or
delivered by
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the Company to the Holder thereof. The Company will publicly announce the
results of the Change of Control Offer on or as soon as practicable after the
consummation thereof.
ARTICLE XII
GUARANTY
SECTION 12.1. GUARANTY.
(a) In consideration of good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, each of the
Guarantors hereby irrevocably and unconditionally guarantees (the
"Guaranty"), jointly and severally, to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and enforceability of
this Indenture, the Securities or the obligations of the Company under this
Indenture or the Securities, that: (w) the principal and premium (if any) of
and interest on the Securities will be paid in full when due, whether at the
Maturity Date or Interest Payment Date, by acceleration, call for redemption,
upon a Change of Control Offer, upon an Asset Sale Offer or otherwise; (x)
all other obligations of the Company to the Holders or the Trustee under this
Indenture or the Securities will be promptly paid in full or performed, all
in accordance with the terms of this Indenture and the Securities; and (y) in
case of any extension of time of payment or renewal of any Securities or any
of such other obligations, they will be paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at maturity,
by acceleration, call for redemption, upon a Change of Control Offer, upon an
Asset Sale Offer or otherwise. Failing payment when due of any amount so
guaranteed for whatever reason, each Guarantor shall be jointly and severally
obligated to pay the same before failure so to pay becomes an Event of
Default. If the Company or a Guarantor defaults in the payment of the
principal of, premium, if any, or interest on, the Securities when and as the
same shall become due, whether upon maturity, acceleration, call for
redemption, upon a Change of Control Offer, upon an Asset Sale Offer or
otherwise, without the necessity of action by the Trustee or any Holder, each
Guarantor shall be required, jointly and severally, to promptly make such
payment in full.
(b) Each Guarantor hereby agrees that its obligations with
regard to this Guaranty shall be unconditional, irrespective of the validity,
regularity or enforceability of the Securities or this Indenture, the absence
of any action to enforce the same, any delays in obtaining or realizing upon
or failures to obtain or realize upon collateral, the recovery of any
judgment against the Company, any action to enforce the same or any other
circumstances that might otherwise constitute a legal or equitable discharge
or defense of a guarantor (except as provided in Sections 12.4 and 12.5).
Each Guarantor hereby waives diligence, presentment, demand of payment,
filing of claims with a court in the event of insolvency or bankruptcy of the
Company, any right to require a proceeding first against the
86
Company or right to require the prior disposition of the assets of the
Company to meet its obligations, protest, notice and all demands whatsoever
and covenants that this Guaranty will not be discharged (except to the extent
released pursuant to Section 12.4 or 12.5) except by complete performance of
the obligations contained in the Securities and this Indenture.
(c) If any Holder or the Trustee is required by any court
or otherwise to return to either the Company or any Guarantor, or any
Custodian, trustee, or similar official acting in relation to the Company or
such Guarantor, any amount paid by either the Company or such Guarantor to
the Trustee or such Holder, this Guaranty, to the extent theretofore
discharged, shall be reinstated in full force and effect (except to the
extent released pursuant to Section 12.4 or 12.5). Each Guarantor agrees
that it will not be entitled to any right of subrogation in relation to the
Holders in respect of any obligations guaranteed hereby until payment in full
of all obligations guaranteed hereby. Each Guarantor further agrees that, as
between such Guarantor, on the one hand, and the Holders and the Trustee, on
the other hand, (i) the maturity of the obligations guaranteed hereby may be
accelerated as provided in Section 6.2 for the purposes of this Guaranty,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration as to the Company of the obligations guaranteed hereby, and (ii)
in the event of any declaration of acceleration of those obligations as
provided in Section 6.2, those obligations (whether or not due and payable)
will forthwith become due and payable by each of the Guarantors for the
purpose of this Guaranty.
(d) Each Guarantor and by its acceptance of a Security
issued hereunder each Holder hereby confirms that it is the intention of all
such parties that the guarantee by such Guarantor set forth in Section
12.1(a) not constitute a fraudulent transfer or conveyance for purpose of any
Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar Federal or state law. To effectuate the
foregoing intention, the Holders and such Guarantor hereby irrevocably agree
that the obligations of such Guarantor under its guarantee set forth in
Section 12.1(a) shall be limited to the maximum amount as will, after giving
effect to all other contingent and fixed liabilities of such Guarantor and
after giving effect to any collections from or payments made by or on behalf
of any other Guarantor in respect of the obligations of such other Guarantor
under its guarantee or pursuant to the following paragraph of this Section
12.1(d), result in the obligations of such Guarantor under such guarantee not
constituting such a fraudulent transfer or conveyance.
Each Guarantor that makes any payment or distribution under Section
12.1(a) shall be entitled to a contribution from each other Guarantor equal
to its Pro Rata Portion of such payment or distribution. For purposes of the
foregoing, the "Pro Rata Portion" of any Guarantor means the percentage of
the net assets of all Guarantors held by such Guarantor, determined in
accordance with GAAP.
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(e) It is the intention of each Guarantor and the Company
that the obligations of each Guarantor hereunder shall be joint and several
and in, but not in excess of, the maximum amount permitted by applicable law.
Accordingly, if the obligations in respect of the Guaranty would be annulled,
avoided or subordinated to the creditors of any Guarantor by a court of
competent jurisdiction in a proceeding actually pending before such court as
a result of a determination both that such Guaranty was made without fair
consideration and, immediately after giving effect thereto, such Guarantor
was insolvent or unable to pay its debts as they mature or left with an
unreasonably small capital, then the obligations of such Guarantor under such
Guaranty shall be reduced by such court if and to the extent such reduction
would result in the avoidance of such annulment, avoidance or subordination;
PROVIDED, HOWEVER, that any reduction pursuant to this paragraph shall be
made in the smallest amount as is strictly necessary to reach such result.
For purposes of this paragraph, "fair consideration", "insolvency", "unable
to pay its debts as they mature," "unreasonably small capital" and the
effective times of reductions, if any, required by this paragraph shall be
determined in accordance with applicable law.
SECTION 12.2. EXECUTION AND DELIVERY OF GUARANTY.
Each Guarantor shall be deemed to have signed on each Security
issued hereunder the notation of guarantee set forth on the form of the
Securities attached hereto as Exhibit A to the same extent as if the
signature of such Guarantor appeared on such Security. The delivery of any
Security by the Trustee, after the authentication thereof hereunder, shall
constitute due delivery of the guaranty set forth in Section 12.1 on behalf
of each Guarantor. The notation of a guaranty set forth on any Security shall
be null and void and of no further effect with respect to the guaranty of any
Guarantor which, pursuant to Section 12.4 or Section 12.5, is released from
such guaranty.
SECTION 12.3. SUBSIDIARY GUARANTORS.
(i) All present Subsidiaries of the Company and their Subsidiaries
and (ii) all future Subsidiaries of the Company and their Subsidiaries, which
are not prohibited from becoming guarantors by law or by the terms of any
Acquired Indebtedness or any agreement (other than an agreement entered into
in connection with the transaction resulting in such person becoming a
Subsidiary of the Company or its Subsidiaries) to which such Subsidiary is a
party ("Future Subsidiary Guarantors"), jointly and severally, will guaranty
irrevocably and unconditionally all principal, premium, if any, and interest
on the Securities on a senior subordinated basis; PROVIDED, HOWEVER, that
upon any change in the law, Acquired Indebtedness or any agreement (whether
by expiration, termination or otherwise) which no longer prohibits a
Subsidiary of the Company from becoming a Subsidiary Guarantor, such
Subsidiary shall immediately thereafter become a Subsidiary Guarantor;
PROVIDED, FURTHER, in the event that any Subsidiary of the Company or their
Subsidiaries becomes a guarantor
88
of any other Indebtedness of the Company or any of its Subsidiaries or any of
their Subsidiaries, such Subsidiary shall immediately thereafter become a
Subsidiary Guarantor.
SECTION 12.4. GUARANTOR MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
(a) Nothing contained in this Indenture or in any of the
Securities shall prevent any consolidation or merger of a Guarantor with or into
the Company or any other Guarantor. Upon any such consolidation or merger, the
guarantees (as set forth in Section 12.1) of the Guarantor which is not the
survivor of the merger or consolidation, and of any Subsidiary of such Guarantor
that is also a Guarantor, shall be released and shall no longer have any force
or effect.
(b) Nothing contained in this Indenture shall prevent any sale
or conveyance of assets of any Guarantor (whether or not constituting all or
substantially all of the assets of such Guarantor) to any Person, provided that
the Company shall comply with the provisions of Section 4.14 and 4.17, and
provided further that, in the event that all or substantially all of the assets
of a Guarantor are sold or conveyed, the guarantees of such Guarantor (as set
forth in Section 12.1) shall be released and shall no longer have any force or
effect.
(c) Except as provided in Section 12.4(a) or Section 12.5,
each Guarantor shall not, directly or indirectly, consolidate with or merge with
or into another Person, unless (i) either (a) the Guarantor is the continuing
entity or (b) the resulting or surviving entity is a corporation organized under
the laws of the United States, any state thereof or the District of Columbia and
expressly assumes by supplemental indenture all of the obligations of the
Guarantor in connection with the Securities and this Indenture; (ii) no Default
or Event of Default would occur as a consequence of (after giving effect, on a
PRO FORMA basis, to) such transaction; and (iii) the Guarantor has delivered to
the Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation or merger and if a supplemental indenture is required,
such supplemental indenture comply with this Indenture and that all conditions
precedent herein relating to such transaction have been satisfied.
(d) Upon any consolidation or merger of a Guarantor in
accordance with Section 12.4 hereof, the successor corporation formed by such
consolidation or into which the Guarantor is merged shall succeed to, and be
substituted for, and may exercise every right and power of, the Guarantor under
this Indenture with the same effect as if such successor corporation had been
named herein as the Guarantor, and when a successor corporation duly assumes all
of the obligations of the Guarantor pursuant hereto and pursuant to the
Securities, the Guarantor shall be released from such obligations.
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SECTION 12.5. RELEASE OF GUARANTORS.
(a) Without any further notice or action being required by
any Person, any Guarantor, and each Subsidiary of such Guarantor that is also
a Guarantor, shall be fully and conditionally released and discharged from
all obligations under its guarantee and this Indenture, upon (i) the sale or
other disposition of all or substantially all of the assets or properties of
such Guarantor, or 50% or more of the Equity Interests of any such Guarantor
to Persons other than the Company and their Subsidiaries or (ii) the
consolidation or merger of any such Guarantor with any Person other than the
Company or a Subsidiary of the Company, if, as a result of such consolidation
or merger, Persons other than the Company and their Subsidiaries beneficially
own more than 50% of the capital stock of such Guarantor, PROVIDED that, in
either such case, the Net Cash Proceeds of such sale, disposition, merger or
consolidation are applied in accordance with Section 4.14 of this Indenture;
or (iii) a Legal Defeasance or Covenant Defeasance, as set forth in Article
VIII.
(b) The releases and discharges set forth in Section
12.5(a) shall be effective (i) in the case of releases and discharges
effected pursuant to clause (i) or (ii) of Section 12.5(a) by virtue of a
sale, disposition, consolidation or merger, on the date of consummation
thereof and (ii) in the case of releases and discharges effected pursuant to
clause (iii) of Section 12.5(a), upon the date of Covenant Defeasance or
Legal Defeasance, as applicable. At the written request of the Company, the
Trustee shall promptly execute and deliver appropriate instruments in forms
reasonably acceptable to the Company evidencing and further implementing any
releases and discharges pursuant to the foregoing provisions. If the Company
desires the instruments evidencing or implementing any releases or discharges
to be executed prior to the effectiveness of such releases and discharges as
set forth above, such instruments may be made conditional upon the occurrence
of the events necessary to cause the effectiveness of such releases and
discharges, as specified in the first sentence of this Section 12.5.
(c) Notwithstanding the foregoing provisions of this
Article XII, (i) any Guarantor whose guarantee would otherwise be released
pursuant to the provisions of this Section 12.5 may elect, by written notice
to the Trustee, to maintain such guarantee in effect notwithstanding the
event or events that otherwise would cause the release of such guarantee
(which election to maintain such guarantee in effect may be conditional or
for a limited period of time), and (ii) any Subsidiary of the Company which
is not a Guarantor may elect, by written notice to the Trustee, to become a
Guarantor (which election may be conditional or for a limited period of
time).
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SECTION 12.6. CERTAIN BANKRUPTCY EVENTS.
Each Guarantor hereby covenants and agrees, to the fullest extent that
it may do so under applicable law, that in the event of the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Company, such
Guarantor shall not file (or join in any filing of), or otherwise seek to
participate in the filing of, any motion or request seeking to stay or to
prohibit (even temporarily) execution on the Guaranty and hereby waives and
agrees not to take the benefit of any such stay of execution, whether under
Section 362 or 105 of the Bankruptcy Law or otherwise.
ARTICLE XIII
MISCELLANEOUS
SECTION 13.1. TIA CONTROLS.
If any provision of this Indenture limits, qualifies, or conflicts
with the duties imposed by operation of the TIA, the imposed duties, upon
qualification of this Indenture under the TIA, shall control.
SECTION 13.2. NOTICES.
Any notices or other communications to the Company or any Guarantor,
Paying Agent, Registrar, Securities Custodian, transfer agent or the Trustee
required or permitted hereunder shall be in writing, and shall be sufficiently
given if made by hand delivery, by telecopier or registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:
if to the Company or any Guarantor:
Jacor Communications Company
50 East RiverCenter Boulevard, 12th Floor
Covington, KY 41011
Attention: Treasurer
Telephone: (606) 655-2267
Telecopy: (606) 655-9345
if to the Trustee:
The Bank of New York
91
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee
Administration
Telephone: (212) 815-5741
Telecopy: (212) 815-5915
Any party by notice to each other party may designate additional or
different addresses as shall be furnished in writing by such party. Any notice
or communication to any party shall be deemed to have been given or made as of
the date so delivered, if personally delivered; when receipt is acknowledged, if
telecopied; and five Business Days after mailing if sent by registered or
certified mail, postage prepaid (except that a notice of change of address shall
not be deemed to have been given until actually received by the addressee).
Any notice or communication mailed to a Securityholder shall be mailed
to him by first class mail or other equivalent means at his address as it
appears on the registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 13.3. COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS.
Securityholders may communicate pursuant to TIA Section 312(b) with
other Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other Person shall
have the protection of TIA Section 312(c).
SECTION 13.4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company or any Guarantor to the
Trustee to take any action under this Indenture, such Person shall furnish to
the Trustee:
(1) an Officers' Certificate (in form and substance reasonably
satisfactory to the Trustee) stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been met; and
92
(2) an Opinion of Counsel (in form and substance reasonably
satisfactory to the Trustee), stating that, in the opinion of such counsel,
all such conditions precedent have been met; PROVIDED, HOWEVER, that in the
case of any such request or application as to which the furnishing of
particular documents is specifically required by any provision of this
Indenture, no additional certificate or opinion need be furnished under
this Section 13.4.
SECTION 13.5. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) 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;
(3) a statement that, in the opinion of such Person, he 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 met; and
(4) a statement as to whether or not, in the opinion of each
such Person, such condition or covenant has been met; PROVIDED, HOWEVER,
that with respect to matters of fact an Opinion of Counsel may rely on an
Officers' Certificate or certificates of public officials.
SECTION 13.6. RULES BY TRUSTEE, PAYING AGENT, REGISTRAR.
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Paying Agent or Registrar may make reasonable rules for
its functions.
SECTION 13.7. NON-BUSINESS DAYS.
If a payment date is not a Business Day at such place, payment may be
made at such place on the next succeeding day that is a Business Day, and no
interest shall accrue for the intervening period.
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SECTION 13.8. GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS
MADE AND PERFORMED WITHIN THE STATE OF NEW YORK. EACH OF THE COMPANY AND THE
GUARANTORS HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE AND
THE SECURITIES, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS.
EACH OF THE COMPANY AND THE GUARANTORS IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION WHICH THEY MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE TRUSTEE OR ANY SECURITYHOLDER TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL
PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE COMPANY AND THE GUARANTORS IN ANY
OTHER JURISDICTION.
SECTION 13.9. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any Guarantor or any of their respective
Subsidiaries. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
SECTION 13.10. NO RECOURSE AGAINST OTHERS.
No direct or indirect stockholder, partner, employee, officer or
director, as such, past, present or future of the Company, the Guarantors or any
successor entity, shall have any personal liability in respect of the
obligations of the Company or the Guarantors under the Securities or this
Indenture by reason of his or its status as such stockholder, partner, employee,
officer or director. Each Securityholder by accepting a Security waives and
releases all such liability. Such waiver and release are part of the
consideration for the issuance of the Securities.
94
SECTION 13.11. SUCCESSORS.
All agreements of the Company and the Guarantors in this Indenture and
the Securities shall bind its successor. All agreements of the Trustee in this
Indenture shall bind its successor.
SECTION 13.12. DUPLICATE ORIGINALS.
All parties may sign any number of copies or counterparts of this
Indenture. Each signed copy or counterpart shall be an original, but all of
them together shall represent the same agreement.
SECTION 13.13. SEVERABILITY.
In case any one or more of the provisions in this Indenture or in the
Securities shall be held invalid, illegal or unenforceable, in any respect for
any reason, the validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions shall not in any way be
affected or impaired thereby, it being intended that all of the provisions
hereof shall be enforceable to the full extent permitted by law.
SECTION 13.14. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and headings of the
Articles and the Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions hereof.
95
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first written above.
JACOR COMMUNICATIONS COMPANY
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
and Chief Financial Officer
PARENT GUARANTOR
JACOR COMMUNICATIONS, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
and Chief Financial Officer
SUBSIDIARY GUARANTORS:
BROADCAST FINANCE, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
CINE FILMS, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
CINE GUARANTORS, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
CINE GUARANTORS II, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
CINE GUARANTORS II, LTD.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
CINE MOBILE SYSTEMS INT'L N.V.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
CINE MOVIL S.A. DE C.V.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
CITICASTERS CO.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
GACC-N26LB, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
GREAT AMERICAN MERCHANDISING GROUP, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
GREAT AMERICAN TELEVISION PRODUCTIONS,
INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
INMOBILARIA RADIAL, S.A. DE C.V.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Treasurer
JACOR BROADCASTING CORPORATION
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF ATLANTA, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF CHARLESTON, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF COLORADO, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF DENVER, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF FLORIDA, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF KANSAS CITY, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF LAS VEGAS, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF LAS VEGAS II
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF LOUISVILLE, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF LOUISVILLE II, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF SALT LAKE CITY,
INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF SALT LAKE CITY II,
INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF ST. LOUIS, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF SAN DIEGO, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF SARASOTA, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF TAMPA BAY, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF TOLEDO, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR BROADCASTING OF YOUNGSTOWN, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR CABLE, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR LICENSEE OF CHARLESTON, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR LICENSEE OF KANSAS CITY, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR LICENSEE OF LAS VEGAS, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR LICENSEE OF LAS VEGAS II, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR LICENSEE OF LOUISVILLE, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR LICENSEE OF LOUISVILLE II, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR LICENSEE OF SALT LAKE CITY, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR LICENSEE OF SALT LAKE CITY II, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JACOR/PREMIERE HOLDING, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
JBSL, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
LOCATION PRODUCTIONS, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
LOCATION PRODUCTIONS II, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
MULTIVENSE ACQUISITION CORP.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
NOBLE BROADCAST CENTER, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
NOBLE BROADCAST GROUP, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
NOBLE BROADCAST HOLDINGS, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
NOBLE BROADCAST LICENSES, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
NOBLE BROADCAST OF SAN DIEGO, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
NOBRO, S.C.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Treasurer
NOVA MARKETING GROUP, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
NSN NETWORK SERVICES, LTD.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
PREMIERE RADIO NETWORKS, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
RADIO-ACTIVE MEDIA, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
SPORTS RADIO BROADCASTING, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
SPORTS RADIO, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
THE SY FISCHER COMPANY AGENCY, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
VTTV PRODUCTIONS
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
WHOK, INC.
By: /s/ R. Christopher Weber
-----------------------------------
Name: R. Christopher Weber
Title: Senior Vice President
THE BANK OF NEW YORK, as Trustee
By: /s/ Lucille Firrincieli
-----------------------------------
Name: Lucille Firrincieli
Title: Assistant Vice President
Exhibit A
[FORM OF SECURITY]
JACOR COMMUNICATIONS COMPANY
8% SENIOR SUBORDINATED NOTE
DUE 2010
CUSIP: 469856 AE 8
No. $_________________
Jacor Communications Company, a Florida corporation (hereinafter
called the "Company" which term includes any successors under the Indenture
hereinafter referred to), for value received, hereby promises to pay to _______,
or registered assigns, the principal sum of _____ Dollars, on February 15, 2010.
Interest Payment February 15 and August 15; commencing August 15,
1998.
Record Dates: February 1 and August 1.
Reference is made to the further provisions of this Security on the
reverse side, which will, for all purposes, have the same effect as if set forth
at this place.
IN WITNESS WHEREOF, the Company has caused this Instrument to be duly
executed under its corporate seal.
Dated:
Jacor Communications Company,
a Florida corporation
By:
---------------------------------------------------
Name:
Title:
Attest:
-------------------
Secretary
A-1
FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities described in the within-mentioned
Indenture.
THE BANK OF NEW YORK
as Trustee
By:
---------------------------------
Authorized Signatory
Dated:
A-2
JACOR COMMUNICATIONS COMPANY
8% SENIOR SUBORDINATED NOTE
DUE 2010
Unless and until it is exchanged in whole or in part for Securities in
definitive form, this Security 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 their 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 requested by an authorized representative of
DTC (and any payment is made to Cede & Co. or such other entity as is 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.(1)
1. INTEREST.
Jacor Communications Company, a Florida corporation (hereinafter
called the "Company," which term includes any successors under the Indenture
hereinafter referred to), promises to pay interest on the principal amount of
this Security at the rate of 8% per annum from the date of issuance until
maturity. To the extent it is lawful, the Company promises to pay interest on
any interest payment due but unpaid on such principal amount at a rate of 8% per
annum compounded semi-annually.
The Company will pay interest semi-annually on February 15 and
February 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"), commencing February
15, 1998. Interest on the Securities will accrue from the most recent date to
which interest has been paid or, if no interest has been paid on the Securities,
from the date of issuance. Interest will be computed on the basis of a 360-day
year consisting of twelve 30-day months.
- ------------------------------
(1) This paragraph should only be added if the Security is issued in global
form.
A-3
2. METHOD OF PAYMENT.
The Company shall pay interest on the Securities (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on June 1 and December 1 immediately preceding the Interest Payment Date.
Holders must surrender Securities to a Paying Agent to collect principal
payments. Except as provided below, the Company shall pay principal and
interest in such coin or currency of the United States of America as at the time
of payment shall be legal tender for payment of public and private debts
("Cash"). The Securities will be payable as to principal, premium 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 principal, premium and interest 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 of and interest and premium on all Global Securities and all other
Securities the Holders of which shall have provided written wire transfer
instructions to the Company or the Paying Agent at least 15 days prior to the
date for payment.
3. PAYING AGENT AND REGISTRAR.
Initially, The Bank of New York will act as Paying Agent and
Registrar. The Company may change any Paying Agent, Registrar or co-Registrar
without notice to the Holders. The Company or any of its Subsidiaries may,
subject to certain exceptions, act as Paying Agent, Registrar or co-Registrar.
4. INDENTURE.
The Company issued the Securities under an Indenture, dated as of
February 9, 1998 (the "Indenture"), among the Company, Jacor Communications,
Inc., a Delaware corporation (the "Parent Guarantor"), the Subsidiary Guarantors
named therein (the "Subsidiary Guarantors" together with the Parent Guarantor,
the "Guarantors"), and The Bank of New York (the "Trustee" which term includes
any successor Trustee under the Indenture). Capitalized terms herein are used
as defined in the Indenture unless otherwise defined herein. The terms of the
Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act, as in effect on the date of
the Indenture. The Securities are subject to all such terms, and Holders of
Securities are referred to the Indenture and said Act for a statement of them.
The Securities are senior subordinated obligations of the Company limited in
aggregate principal amount to $120,000,000. The Securities are, to the extent
and in the manner provided in the Indenture, subordinate and subject in right of
payment to the prior payment in full of all Senior Debt of the Company,
A-4
whether outstanding on the date of the Indenture or thereafter created,
incurred, assumed or guaranteed. Each Holder of this Security, by accepting
the same, (a) agrees to and shall be bound by such provisions, (b) authorizes
and directs the Trustee on his behalf to take such action as may be provided
in the Indenture and (c) appoints the Trustee his attorney-in-fact for such
purpose. The Securities are guaranteed on a senior subordinated basis by the
Guarantors.
5. REDEMPTION.
The Securities may be redeemed, in whole or in part, at any time on or
after February 15, 2003, at the option of the Company, at the Redemption Price
(expressed as a percentage of principal amount) set forth below with respect to
the indicated Redemption Date, in each case (subject to the right of Holders of
record on a Record Date that is on or prior to such Redemption Date to receive
interest due on the Interest Payment Date to which such Record Date relates),
plus any accrued but unpaid interest to the Redemption Date. The Securities may
not be so redeemed prior to February 15, 2003.
If redeemed during
the 12-month period
commencing February 15, Redemption Price
----------------------- ----------------
2003 . . . . . . . . . . . . 104.000%
2004 . . . . . . . . . . . . 103.200%
2005 . . . . . . . . . . . . 102.400%
2006 . . . . . . . . . . . . 101.600%
2007 . . . . . . . . . . . . 100.800%
2008 and thereafter. . . . . 100.000%
Any such redemption will comply with Article III of the Indenture.
6. NOTICE OF REDEMPTION.
Notice of redemption will be sent by first class mail, at least 30 days
and not more than 60 days prior to the Redemption Date to the Holder of each
Security to be redeemed at such Holder's last address as then shown upon the
registry books of the Registrar. Securities may be redeemed in part in
multiples of $1,000 only.
Except as set forth in the Indenture, from and after any Redemption Date,
if monies for the redemption of the Securities called for redemption shall have
been deposited with the Paying Agent on such Redemption Date and payment of the
Securities called for redemption is not otherwise prohibited, the Securities
called for
A-5
redemption will cease to bear interest and the only right of the Holders of
such Securities will be to receive payment of the Redemption Price.
7. DENOMINATIONS; TRANSFER; EXCHANGE.
The Securities are in registered form, without coupons, in denominations
of $1,000 and integral multiples of $1,000. A Holder may register the transfer
of, or exchange Securities in accordance with, the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not register the transfer of or exchange any
Securities (a) selected for redemption except the unredeemed portion of any
Security being redeemed in part or (b) for a period beginning 15 Business Days
before the mailing of a notice of an offer to repurchase or redemption and
ending at the close of business on the day of such mailing.
8. PERSONS DEEMED OWNERS.
The registered Holder of a Security may be treated as the owner of it for
all purposes.
9. UNCLAIMED MONEY.
If money for the payment of principal or interest remains unclaimed for
two years, the Trustee and the Paying Agent(s) will pay the money back to the
Company at their written request. After that, all liability of the Trustee and
such Paying Agent(s) with respect to such money shall cease.
10. DISCHARGE PRIOR TO REDEMPTION OR MATURITY.
Except as set forth in the Indenture, if the Company irrevocably deposits
with the Trustee, in trust, for the benefit of the Holders, Cash, U.S.
Government Obligations 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 of, premium, if any, and interest on the
Securities to redemption or maturity and comply with the other provisions of the
Indenture relating thereto, the Company will be discharged from certain
provisions of the Indenture and the Securities (including the restrictive
covenants described in paragraph 12 below, but excluding their obligation to pay
the principal of and interest on the Securities). Upon satisfaction of certain
additional conditions set forth in the Indenture, the Company may elect to have
its obligations discharged with respect to outstanding Securities.
A-6
11. AMENDMENT; SUPPLEMENT; WAIVER.
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented with the written consent of the Holders of at least a
majority in aggregate principal amount of the Securities then outstanding, and
any existing Default or Event of Default or compliance with any provision may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding. An amendment, supplement or waiver
with respect to Section 11.1 (Change of Control Offer) in a manner adverse to
the Holders, requires not less than 75% of the aggregate principal amount of the
Securities then outstanding. Without notice to or consent of any Holder, the
parties thereto may under certain circumstances amend or supplement the
Indenture or the Securities to, among other things, cure any ambiguity, defect
or inconsistency, or make any other change that does not adversely affect the
rights of any Holder of a Security.
12. RESTRICTIVE COVENANTS.
The Indenture imposes certain limitations on the ability of the Company
and the Guarantors to, among other things, incur additional Indebtedness and
Disqualified Equity Interests, pay dividends or make certain other restricted
payments, enter into certain transactions with Affiliates, incur Liens, sell
assets, merge or consolidate with any other Person or transfer (by lease,
assignment or otherwise) substantially all of the properties and assets of the
Company. The limitations are subject to a number of important qualifications
and exceptions. The Company must periodically report to the Trustee on
compliance with such limitations.
13. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be required to
offer to purchase on the Change of Control Purchase Date all outstanding
Securities at a purchase price equal to 101% of the principal amount thereof,
together with accrued interest to the Change of Control Purchase Date. Holders
of Securities will receive a Change of Control Offer from the Company prior to
any related Change of Control Purchase Date and may elect to have such
Securities purchased by completing the form entitled "Option of Holder to Elect
Purchase" appearing below.
(b) The Indenture imposes certain limitations on the ability of the
Company, the Guarantors or any of their respective Subsidiaries to sell
assets. In the event the proceeds from a permitted Asset Sale exceed certain
amounts, as specified in the Indenture, the Company will be required to use
the proceeds of such Asset Sale in the manner required by the Indenture,
including (i) to reinvest such proceeds in its
A-7
business, (ii) to repay Senior Debt, (iii) to make an offer to purchase the
10 1/8% Notes, (iv) to make an offer to purchase the 9 3/4% Notes, (v) to make
an offer to purchase the 8 3/4% Notes, or (vi) to make an offer to purchase a
certain amount of each Holder's Securities at 100% of the principal amount
thereof, plus accrued interest, if any, to the purchase date.
14. NOTATION OF GUARANTY.
As set forth more fully in the Indenture, the Persons constituting
Guarantors from time to time, in accordance with the provisions of the
Indenture, unconditionally and jointly and severally guarantee, in accordance
with Section 12.1 of the Indenture, to the Holder and to the Trustee and its
successors and assigns, that (i) the principal of and interest on the Security
will be paid, whether at the Maturity Date or Interest Payment Dates, by
acceleration, call for redemption upon a Change of Control Offer, upon an Asset
Sale Offer or otherwise, and all other obligations of the Company to the Holder
or the Trustee under the Indenture or this Security will be promptly paid in
full or performed, all in accordance with the terms of the Indenture and this
Security, and (ii) in the case of any extension of payment or renewal of this
Security or any of such other obligations, they will be paid in full when due or
performed in accordance with the terms of such extension or renewal, whether at
the Maturity Date, as so extended, by acceleration, call for redemption, upon a
Change of Control Offer, upon an Asset Sale Offer or otherwise. Such guarantees
shall cease to apply, and shall be null and void, with respect to any Guarantor
who, pursuant to Article XII of the Indenture, is released from its guarantees,
or whose guarantees otherwise cease to be applicable pursuant to the terms of
the Indenture.
15. SUCCESSORS.
When a successor assumes all the obligations of its predecessor under the
Securities and the Indenture, the predecessor will be released from those
obligations.
16. DEFAULTS AND REMEDIES.
If an Event of Default occurs and is continuing (other than an Event of
Default relating to certain events of bankruptcy, insolvency or reorganization),
then in every such case, unless the principal of all of the Securities shall
have already become due and payable, either the Trustee or the Holders of 25% in
aggregate principal amount of Securities then outstanding may declare all the
Securities to be due and payable immediately in the manner and with the effect
provided in the Indenture. Holders of Securities may not enforce the Indenture
or the Securities except as provided in the Indenture. The Trustee may require
indemnity satisfactory to it before it enforces the Indenture or the Securities.
Subject to certain limitations, Holders of a
A-8
majority in aggregate principal amount of the Securities then outstanding may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of Securities notice of any continuing Default or Event
of Default (except a Default in payment of principal or interest), if it
determines that withholding notice is in their interest.
17. TRUSTEE OR AGENT DEALINGS WITH THE COMPANY.
The Trustee and each Agent under the Indenture, 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 and such Agent.
18. NO RECOURSE AGAINST OTHERS.
No direct or indirect stockholder, partner, employee, officer or
director, as such, past, present or future, of the Company, the Guarantors or
any successor entity shall have any personal liability in respect of the
obligations of the Company or the Guarantors under the Securities or the
Indenture by reason of his or its status as such stockholder, partner, employee,
officer or director. Each Holder of a Security by accepting a Security waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
19. AUTHENTICATION.
This Security shall not be valid until the Trustee or authenticating
agent signs the certificate of authentication on the other side of this
Security.
20. ABBREVIATIONS AND DEFINED TERMS.
Customary abbreviations may be used in the name of a Holder of a Security
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).
21. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to be
printed on the Securities as a convenience to the Holders of the Securities. No
representation is made as to the accuracy of such numbers as printed on the
Securities and reliance may be placed only on the other identification numbers
printed hereon.
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22. ADDITIONAL RIGHTS OF HOLDERS OF SECURITIES.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Jacor Communications Company
50 East RiverCenter Boulevard
12th Floor
Covington, Kentucky 41011
Attn: Corporate Secretary
23. GOVERNING LAW
The Indenture and the Securities shall be governed by and construed in
accordance with the internal laws of the State of New York.
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FORM OF ASSIGNMENT
I or we assign this Security to
- ----------------------------------------------------------
- ----------------------------------------------------------
- ----------------------------------------------------------
(Print or type name, address and zip code of assignee)
Please insert Social Security or other identifying number of assignee
- -------------------------
and irrevocably appoint __________ agent to transfer this Security on the books
of the Company. The agent may substitute another to act for him.
Dated: Signed:
---------- ------------------------------
- ----------------------------------------------------------
(Sign exactly as name appears on
the other side of this Security)
Signature Guaranty*
- -----------------------
*NOTICE: The Signature must be guaranteed by an Institution which is a
member of one of the following recognized signature Guarantee Programs:
(I) The Securities Transfer Agent Medallion Program (STAMP); (ii) The New
York Stock Exchange Medallion Program (MNSP); (iii) The Stock Exchange
Medallion Program (SEMP) or (iv) in such other guarantee program acceptable
to the Trustee.
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.14 or Article XI of the Indenture, check the appropriate
box: / / Section 4.14 / /Section 11.1
If you want to elect to have only part of this Security purchased by the
Company pursuant to Section 4.14 or Article XI of the Indenture, as the case may
be, state the amount you want to be purchased: $________
Date: Signature:
---------------- ------------------------
(Sign exactly as your name
appears on the other side of
this Security)
Signature Guaranty**
- -----------------------
**NOTICE: The Signature must be guaranteed by an Institution which is a
member of one of the following recognized signature Guarantee Programs:
(I) The Securities Transfer Agent Medallion Program (STAMP); (ii) The New
York Stock Exchange Medallion Program (MNSP); (iii) The Stock Exchange
Medallion Program (SEMP) or (iv) in such other guarantee program acceptable
to the Trustee.
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SCHEDULE OF EXCHANGES OF DEFINITIVE SECURITIES***
The following exchanges of a part of this Global Security for Definitive
Securities have been made:
Amount of Amount of Principal Amount Signature of
decrease in increase in of this Global authorized Signatory of
Principal Amount Principal Amount of Security following Trustee or
Date of of this Global this Global such decrease (or Securities
Exchange Security Security increase) Custodian
- ----------------------------------------------------------------------------------------------------------------------------------
----------------------------
*** This schedule should only be added if the Security is issued in
global form.
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CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF
SECURITIES
Re: 8% SENIOR SUBORDINATED NOTES DUE 2010 OF JACOR COMMUNICATIONS COMPANY
This Certificate relates to $______ principal amount of Securities held in
(check applicable box) _____ book-entry or ______ definitive form by _____ (the
"Transferor").
The Transferor (check applicable box):
/ / has requested the Registrar by written order to deliver in exchange
for its beneficial interest in the Global Security held by the Depositary a
Security or Securities in definitive, registered form of authorized
denominations and an aggregate principal amount equal to its beneficial interest
in such Global Security (or the portion thereof indicated above); or
/ / has requested the Registrar by written order to exchange or register
the transfer of a Security or Securities.
-------------------------------------
[INSERT NAME OF TRANSFEROR]
By:
----------------------------------
Date:
---------------------------------
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