FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT UNDER SECTION 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 1997 Commission file number 1-9645
CLEAR CHANNEL COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Texas 74-1787539
(State of Incorporation) (I.R.S. Employer Identification No.)
200 Concord Plaza, Suite 600
San Antonio, Texas 78216-6940
(210) 822-2828
(Address and telephone number
of principal executive offices)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes __x__ No _____
Indicate the number of shares outstanding of each class of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at November 4, 1997
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Common Stock, $.10 par value 98,069,477
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
INDEX
Page No.
- - - - - - -
Part I -- Financial Information
Item 1. Unaudited Financial Statements
Consolidated Balance Sheets at September 30, 1997
and December 31, 1996 3
Consolidated Statements of Operations for the three
and nine months ended September 30, 1997 and 1996 5
Consolidated Statements of Cash Flows for the nine months ended
September 30, 1997 and 1996 6
Notes to Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 11
Part II -- Other Information
Item 6. Exhibits and reports on Form 8-K 15
(a) Exhibits
(b) Reports on Form 8-K
Signatures 15
Index to Exhibits 16
<PAGE>
PART I
Item 1. UNAUDITED FINANCIAL STATEMENTS
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
September 30, December 31,
1997 1996
(Unaudited) (*)
---------------- ---------------
Current Assets
Cash and cash equivalents $35,178,250 $16,700,752
Income tax receivable --- 3,092,693
Accounts receivable, less allowance of
$11,679,124 at September 30, 1997 and
$6,066,794 at December 31, 1996 126,755,753 79,182,580
Film rights - current 16,124,116 14,187,640
-------------- --------------
Total Current Assets 178,058,119 113,163,665
Property, Plant and Equipment
Land 23,158,968 12,235,273
Buildings 40,404,834 28,992,708
Transmitter and studio equipment 166,315,517 153,254,927
Furniture and other equipment 38,557,044 21,163,668
Leasehold improvements 5,416,710 5,322,365
Structures and site leases 449,848,520 ---
Construction in progress 59,754,863 4,284,361
-------------- --------------
783,456,456 225,253,302
Less accumulated depreciation (115,625,686) (77,415,597)
-------------- --------------
667,830,770 147,837,705
Intangible Assets
Network affiliation agreements 33,726,904 33,726,904
Licenses and goodwill 1,601,062,610 764,233,345
Covenants not-to-compete 24,591,932 22,991,932
Other intangible assets 13,001,733 8,711,977
---------------- ---------------
1,672,383,179 829,664,158
Less accumulated amortization (120,198,288) (78,645,708)
---------------- ---------------
1,552,184,891 751,018,450
Other Assets
Deferred tax asset 10,520,498 ---
Notes receivable - long-term --- 52,750,000
Film rights - net 16,181,912 13,436,589
Equity investments in, and advances
to, nonconsolidated affiliates 273,326,463 230,659,734
Other assets 65,759,487 10,807,633
Other investments 27,342,702 5,037,310
--------------- ---------------
Total Assets $2,791,204,842 $1,324,711,086
========== ==========
* From audited financial statements
See Notes to Consolidated Financial Statements
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
September 30, December 31,
1997 1996
(Unaudited) (*)
---------------- ---------------
Current Liabilities
Accounts payable $12,877,022 $9,864,401
Accrued interest 2,037,131 6,272,193
Accrued expenses 37,522,606 8,235,966
Income and other taxes 3,741,810 ---
Deferred income - current 1,380,000 1,300,000
Current portion of long-term debt 13,067,246 1,479,327
Current portion of film rights liability 16,989,409 16,309,787
-------------- -------------
Total Current Liabilities 87,615,224 43,461,674
Long-term debt 897,588,467 725,131,618
Film rights liability 17,857,139 13,797,015
Deferred income taxes 15,839,624 11,283,303
Deferred income - long-term 10,075,000 11,250,000
Other long-term liabilities 43,240,996 ---
Minority interests 21,112,991 6,356,885
Shareholders' Equity
Common stock 9,808,991 7,699,207
Additional paid-in capital 1,540,071,790 398,621,825
Retained earnings 147,356,170 106,054,794
Other 1,225,763 1,225,763
Cost of shares held in treasury (587,313) (170,998)
--------------- --------------
Total shareholders' equity 1,697,875,402 513,430,591
--------------- --------------
Total Liabilities and
Shareholders' Equity $2,791,204,842 $1,324,711,086
========== ==========
* From audited financial statements
See Notes to Consolidated Financial Statements
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30, September 30, September 30,
1997 1996 1997 1996
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Gross revenue $532,081,372 $269,735,560 $209,050,450 $107,189,144
Less agency commissions (62,905,862) (31,319,386) (24,942,861) (12,349,686)
----------- ----------- ----------- -----------
Net revenue 469,175,510 238,416,174 184,107,589 94,839,458
Operating expenses 266,541,810 135,401,285 99,809,426 53,408,934
Depreciation and amortization 80,215,911 32,364,748 31,545,616 13,022,189
----------- ----------- ----------- -----------
Operating income before corporate expenses 122,417,789 70,650,141 52,752,547 28,408,335
Corporate general and administrative expenses 13,698,590 5,647,710 5,827,718 2,170,128
----------- ----------- ----------- -----------
Operating income 108,719,199 65,002,431 46,924,829 26,238,207
Interest expense (51,804,260) (19,778,376) (19,489,677) (8,033,067)
Other income 7,640,910 665,802 2,441,954 479,345
----------- ----------- ----------- -----------
Income before income taxes 64,555,849 45,889,857 29,877,106 18,684,485
Income taxes (31,641,430) (17,426,852) (14,334,781) (7,260,782)
----------- ----------- ----------- -----------
Income before equity in net income (loss)
of, and other income from, nonconsolidated
affiliates 32,914,419 28,463,005 15,542,325 11,423,703
Equity in net income (loss) of, and other income
from, nonconsolidated affiliates 8,386,957 (6,627,898) 3,066,502 (8,375,072)
----------- ----------- ----------- -----------
Net income $41,301,376 $21,835,107 $18,608,827 $3,048,631
=========== =========== =========== ==========
Net income per common share $ .47 $ .30 $ .20 $ .04
=========== =========== =========== ===========
Weighted average common and common
share equivalents outstanding 87,564,348 73,557,856 93,521,902 78,240,998
=========== =========== =========== ===========
</TABLE>
See Notes to Consolidated Financial Statements
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Nine Months Ended
September 30, September 30,
1997 1996
-------------- -------------
Net Cash Flows Provided By
Operating Activities $120,196,718 $70,153,589
Cash flows from investing activities:
Decrease (Increase) in notes receivable 52,750,000 (53,262,466)
Purchase of broadcasting assets (120,731,460) (464,289,248)
Purchase of outdoor assets (467,516,456) ---
Proceeds from disposal of broadcasting
assets 300,068 14,108
(Increase) in equity investments in and
advances to nonconsolidated
affiliates-net (41,482,909) (140,399,742)
(Increase) in other investments (22,305,392) (516,386)
Purchases of property, plant and equipment (22,569,071) (14,986,565)
(Increase) in other intangible assets (4,289,756) (2,025,186)
(Increase) in other-net (20,484,086) (11,266,924)
------------- ------------
Net cash flows used in investing
activities (646,329,062) (686,732,409)
Cash flows from financing activities:
Proceeds from issuance of common stock 791,719,074 311,165,837
Payments on short-term debt (2,471,126) (262,939)
Payments on long-term debt (1,278,632,285) (316,900,000)
Exercise of stock options 2,736,598 220,225
Proceeds from long-term debt 1,031,257,581 634,875,000
------------- ------------
Net cash flows provided by
financing activities 544,609,842 629,098,123
------------- ------------
Net increase in cash and cash
equivalents 18,477,498 12,519,303
Cash and cash equivalents at beginning
of period 16,700,752 5,391,104
------------ ------------
Cash and cash equivalents at end of period $35,178,250 $17,910,407
========== ==========
See Notes to Consolidated Financial Statements
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
SCHEDULE RECONCILING NET INCOME TO NET CASH
FLOWS PROVIDED BY OPERATING ACTIVITIES
(UNAUDITED)
Nine Months Ended
September 30, September 30,
1997 1996
--------------- ---------------
Net income $41,301,376 $21,835,107
Reconciling items:
Depreciation 38,663,331 14,465,043
Amortization of intangibles 41,552,580 17,899,705
Amortization of film rights 12,395,896 10,533,301
Payments on film rights (12,846,175) (10,395,665)
Recognition of deferred income (1,095,000) ---
Deferred taxes 4,556,321 ---
(Gain) loss on disposal of assets 883,422 (23,627)
Equity in net income of nonconsolidated
affiliates (3,419,370) ---
Dividend and other payments 2,235,550 ---
Changes in operating assets and liabilities:
(Increase) Decrease accounts receivable (6,478,005) 1,982,898
Increase deferred income --- 12,915,000
(Decrease) Increase accounts payable (764,100) 1,910,176
(Decrease) Increase accrued interest (4,314,394) 2,726,435
(Decrease) Increase accrued expenses (3,231,856) 1,153,691
Increase (Decrease) accrued income and
other taxes 6,834,503 (4,848,475)
Increase other liabilities 4,213,327 ---
(Decrease) minority interest (290,688) ---
------------- -------------
Net cash flows provided by operating
activities $120,196,718 $70,153,589
========== ==========
See Notes to Consolidated Financial Statements
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1: PREPARATION OF INTERIM FINANCIAL STATEMENTS
The consolidated financial statements have been prepared by Clear Channel
Communications, Inc. (the "Company") pursuant to the rules and regulations of
the Securities and Exchange Commission ("SEC") and, in the opinion of
management, include all adjustments (consisting only of normal recurring
accruals and adjustments necessary for adoption of new accounting standards)
necessary to present fairly the results of the interim periods shown. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such SEC rules and regulations. Management
believes that the disclosures made are adequate to make the information
presented not misleading. The results for the interim periods are not
necessarily indicative of results for the full year. The financial statements
contained herein should be read in conjunction with the consolidated financial
statements and notes thereto included in the Company's 1996 Annual Report.
The consolidated financial statements include the accounts of the Company and
its subsidiaries, the majority of which are wholly-owned. Investments in
companies in which the Company owns 20 percent to 50 percent of the voting
common stock or otherwise exercises significant influence over operating and
financial policies of the company are accounted for under the equity method. All
significant intercompany transactions are eliminated in the consolidation
process. Certain reclassifications have been made to the 1996 consolidated
financial statements to conform with the 1997 presentation.
Note 2: RECENT ACCOUNTING PRONOUNCEMENTS
In February 1997, the Financial Accounting Standards Board issued Statement No.
128, Earnings Per Share, which is required to be adopted (but may not be adopted
early) for fiscal years ending after December 15, 1997, which is applicable to
the Company's fiscal year ended December 31, 1997. The impact is expected to
result in an immaterial change in earnings per share.
Also in February 1997, the Financial Accounting Standards Board issued Statement
No. 129, Disclosure of Information about Capital Structure, which is effective
for fiscal years ending after December 15, 1997. Statement 129 requires an
explanation, in summary form within the financial statements, of the pertinent
rights, privileges, and characteristics of the Company's various outstanding
securities.
In June 1997, the Financial Accounting Standards Board issued Statement No. 130,
Reporting Comprehensive Income, which is effective for fiscal years beginning
after December 15, 1997. This Statement establishes standards for reporting and
display of comprehensive income and its components in a full set of
general-purpose financial statements.
Also in June 1997, the Financial Accounting Standards Board issued Statement No.
131, Disclosures about Segments of an Enterprise and Related Information, which
is effective for fiscal years beginning after December 15, 1997. This Statement
establishes standards for the way that public business enterprises report
information about operating segments in annual financial statements and requires
that those enterprises report selected information about operating segments in
interim financial reports issued to shareholders.
Note 3: RECENT DEVELOPMENTS
The Company's affiliate, Heftel Broadcasting Corporation ("Heftel"), of which
the Company owned 63.2% of the outstanding common stock, merged with Tichenor
Media System, Inc. ("Tichenor") in February 1997 (the "Tichenor Merger") by
issuing to Tichenor shareholders approximately 5.6 million shares of Heftel
class A common stock. In the Tichenor Merger, all of the shares of Heftel class
A common stock owned by the Company were converted into shares of convertible
nonvoting Class B common stock of Heftel in order to comply with the
cross-interest policy of the Federal Communications Commission. In February
1997, Heftel also completed an equity offering of 4.8 million shares of its
class A common stock (the "Heftel Offering"). In conjunction with the Heftel
Offering, the Company sold 350,000 shares of Heftel class A common stock that it
owned, resulting in a gain on sale of investment securities of approximately
$6.2 million. The sale of these 350,000 shares, together with the effects of the
Tichenor merger and the Heftel Offering, decreased the Company's total ownership
in Heftel to approximately 32.3% of Heftel's aggregate outstanding Class A and
Class B common stock.
On April 10, 1997, the Company acquired approximately ninety-three percent (93%)
of the stock of Eller Media Corporation ("Eller"). Eller's operations include
approximately 50,000 outdoor advertising display faces in 15 major metropolitan
markets. As consideration for the stock acquired, the Company paid cash of
approximately $329 million and issued common stock of the Company in the
aggregate value of approximately $298 million. In addition, the Company issued
options on the Company's common stock with an aggregate value of approximately
$51 million in connection with the assumption of Eller's outstanding stock
options. In addition, the Company assumed approximately $417 million of Eller
long-term debt, which was refinanced at the closing date using the Company's
credit facility. This acquisition is being accounted for as a purchase with
resulting goodwill of approximately $655 million, which is being amortized over
25 years on a straight-line basis. This purchase price allocation is preliminary
and the results of operations of Eller are included in the Company's financial
statements since April 1, 1997.
The results of operations for the nine month periods ending September 30, 1997
includes the operations of Eller from the respective date of acquisition.
Assuming the acquisition had occurred at January 1, 1996, unaudited pro forma
consolidated results of operations for the nine months ended September 30, 1997
and 1996 would have been as follows:
Pro Forma (Unaudited)
Nine Months Ended September 30
In thousands (except per share amounts)
1997 1996
---- ----
Net revenue $525,818 $442,317
Net income $ 31,448 $ 7,035
Net income per share $ .36 $ .09
The pro forma information above is presented in response to applicable
accounting rules relating to business acquisitions and is not necessarily
indicative of the actual results that would have been achieved had Eller been
acquired at the beginning of 1996, nor is it indicative of future results of
operations.
On August 25, 1997, the Company and Paxson Communications Corp. ("Paxson")
entered into definitive agreements which, subject to the terms and conditions
thereof, provide for the acquisition by the Company of 43 of Paxson's radio
stations (three of which are subject to Paxson's acquisition thereof), six radio
news and sports networks, and approximately 350 outdoor advertising display
faces for approximately $629 million in cash, and the grant to the Company of
options to purchase two additional radio stations for approximately $3 million
in cash (the "Paxson Acquisition"). All of the radio stations and display faces
referred to above are located in Florida except for four radio stations located
in Tennessee. On October 1, 1997, the Company entered into Time Brokerage
Agreements ("TBA's") with Paxson regarding the 43 radio stations and consummated
the purchases of the radio news and sports networks and the outdoor advertising
display faces. In addition, the Company loaned to Paxson $398,050,000. This loan
matures on the day the acquisition is consummated or in six months after the
termination of the TBA's, which ever occurs first at an annual interest rate of
10%.
The consummation of the radio station purchases is subject to numerous
conditions, including regulatory approval of the Federal Communications
Commission ("FCC"). Waiver of the FCC's multiple ownership rules will be
required to permit the Company to acquire Paxson radio stations in Jacksonville,
Florida and Mobile, Alabama/Pensacola, Florida where the Company owns television
stations. Additionally, some divestitures of radio stations will likely be
required to obtain FCC approval if the Company exercises its option to purchase
the two additional radio stations referred to above.
On October 23, 1997, the Company entered into a definitive agreement to merge
with Universal Outdoor Holdings, Inc. (Universal). Universal's operations
include approximately 34,000 outdoor advertising display faces in 23 markets.
The merger is structured as an exchange of common stock pursuant to which; each
share of Universal common stock will be exchanged for .67 shares of the
Company's common stock or approximately 19,326,000 shares (the "Universal
Merger"). The Universal Merger is subject to certain closing conditions and
regulatory approvals. This merger is expected to close during 1998.
To facilitate the Eller acquisition and possible future acquisitions including
Paxson, the Company and its lenders amended the Company's credit facility on
April 10, 1997 to increase the total amount available under the line of credit
from $1.04 billion to $1.75 billion. On September 9, 1997, the Company filed a
shelf registration statement on Form S-3 covering a combined $1.5 billion of
debt securities, junior subordinated debt securities, preferred stock, common
stock, warrants, stock purchase contracts and stock purchase units (the "shelf
registration statement"). The shelf registration statement also covers preferred
securities which may be issued from time to time by the Company's three Delaware
statutory business trusts and guarantees of such preferred securities by the
Company.
On September 12, 1997, the Company completed its offering of eight million
shares of common stock under the shelf registration statement. The net proceeds
to the Company were $502,684,000 which was used to reduce the outstanding
balance under the credit facility. Also, on October 9, 1997 the Company
completed its offering of $300 million aggregate principal amount of 7.25%
Debentures due October 15, 2027, under the shelf registration statement. The net
proceeds to the Company were $292,689,000 which was used to reduce the
outstanding balance under the credit facility.
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Results of Operations
Comparison of Three and Nine Months Ended September 30, 1997 to Three and Nine
Months Ended September 30, 1996.
Consolidated net revenue for the three months ended September 30, 1997 increased
94% to $184,107,589 from $94,839,458 for the same quarter of 1996. Operating
expenses increased 87% to $99,809,426 from $53,408,934. Depreciation and
amortization increased 142% to $31,545,616 in the third quarter of 1997 from
$13,022,189 in the third quarter of 1996. Operating income before corporate
expenses increased 86% to $52,752,547 compared to $28,408,335 for the third
quarter of 1996. Interest expense increased 143% to $19,489,677 from $8,033,067
in the third quarter of 1996. Equity in net income (loss) from nonconsolidated
affiliates increased to $3,066,502 in the third quarter of 1997 from
$(8,375,072) in the third quarter of 1996. Net income increased 510% to
$18,608,827 or $.20 per share in the third quarter of 1997 from $3,048,631 or
$.04 per share in the third quarter of 1996.
Consolidated net revenue for the nine months ended September 30, 1997 increased
97% to $469,175,510 from $238,416,174 for the same period in 1996. Operating
expenses increased 97% to $266,541,810 from $135,401,285. Depreciation and
amortization increased 148% to $80,215,911 from $32,364,748. Operating income
before corporate expenses increased 73% to $122,417,789 compared to $70,650,141
for the first nine months of 1996. Interest expense increased 162% to
$51,804,260 from $19,778,376. Other income increased to $7,640,910 from
$665,802. Equity in net income (loss) of, and other income from, nonconsolidated
affiliates increased to $8,386,957 in the first nine months of 1997 from
$(6,627,898) for the comparable period in 1996. Net income increased 89% to
$41,301,376 or $.47 per share from $21,835,107 or $.30 per share in 1996.
The majority of the growth in net revenue and operating expenses for both the
quarter and the nine months ended September 30, 1997 was due to the acquisition
of 93% of the outstanding common stock of Eller on April 10, 1997 and the
acquisition of the following radio and television stations during 1996 and the
first nine months of 1997:
Acquisition Date Network or Station Location
1996 Acquisitions
February 14, 1996 WOOD-AM/FM, WBCT-FM Grand Rapids, MI
May 15, 1996 US Radio, Inc.(USR)
KHEY-AM/FM, KPRR-FM El Paso, TX
KJOJ-FM, KJOJ-AM Houston, TX
KMJX-FM, KDDK-FM Little Rock, AR
WHRK-FM, WDIA-AM Memphis, TN
WKKV-FM Milwaukee, WI
WJCD-FM, WOWI-FM Norfolk, VA
WQOK-FM, WZZU-FM Raleigh, NC
WRAW-AM, WRFY-FM Reading, PA
May 31, 1996 WENZ-FM Cleveland, OH
June 1, 1996 WTVR-AM/FM Richmond, VA
July 1, 1996 WPRI-TV Providence, RI
WNAC-TV Providence, RI
August 1, 1996 KEYI-FM, KFON-AM Austin, TX
August 1, 1996 Radio Equity Partners, LP (REP)
WARQ-FM, WWDM-FM Columbia, SC
WXRM-FM, WCKT-FM Ft. Myers/Naples, FL
WSJS-AM, WTQR-FM,
WXRA-FM Greensboro, NC
WNOE-FM, KLJZ-FM
(now KKND-FM) New Orleans, LA
WHYN-AM/FM Springfield, MA
KXXY-AM (now KEBC-AM),
KXXY-FM, KTST-FM Oklahoma City, OK
October 1, 1996 WHKW-AM (now WKJK-AM),
WWKY-AM, WTFX-FM Louisville, KY
WSVY-FM Norfolk, VA
October 11, 1996 WCUZ-AM/FM Grand Rapids, MI
November 27, 1996 WMYK-FM Norfolk, VA
December 3, 1996 Radio Equity Partners, LP (REP)
WRXQ-FM WEGR-FM,
WREC-AM Memphis, TN
WWBB-FM, WWRX-FM Providence, RI
December 16, 1996 KJMS-FM, KWAM-AM Memphis, TN
1997 Acquisitions
January 31, 1997 WZZU-FM Fuquay-Varina (Raleigh), NC
January 31, 1997 WQMF-FM and WHKW-FM Jeffersonville, IN (Louisville, KY)
February 5, 1997 KHOM-FM Houma (New Orleans), LA
February 5, 1997 KJOJ-AM Conroe (Houston), TX
February 28, 1997 WVTI-FM Holland (Grand Rapids), MI
March 14, 1997 Radio Enterprises (1)
WQBK-FM, WTMM-AM,
WQBJ-FM and WXCR-FM Albany, NY
March 31, 1997 WMIL-FM and WOKY-AM Milwaukee, WI
April 10, 1997 WKII-AM, WXRM-FM and WOLZ-FM Ft. Myers, FL
August 15, 1997 WMFX-FM and WOIC-AM Columbia, SC
August 20, 1997 WLAN-AM/FM Lancaster, PA
September 15, 1997 WDUR-AM, WFXC-FM and WFXK-FM Raleigh, NC
(1) These stations were purchased by the Company's 80%-owned subsidiary, Radio
Enterprises, Inc.
The majority of the increase in depreciation and amortization was primarily due
to the acquisition of the tangible and intangible assets associated with the
purchase of Eller and the above-mentioned radio and television acquisitions.
Interest expense increased primarily due to an increase in the average amount of
debt outstanding -- which resulted from the above-mentioned acquisitions, the
Company's funding in 1996 of the acquisition by Australian Radio Network ("ARN")
of additional radio stations and the Company's purchase in August 1996 of an
additional 41.8% interest in Heftel, which brought the Company's temporary
controlling interest at that time in Heftel to 63.2%. Other income for the nine
months increased primarily from the sale of 350,000 shares of Class A common
stock of Heftel by the Company in the first quarter of 1997, which resulted in a
$6.2 million gain. The majority of the increase in net income also was primarily
due to the factors stated above, but was partially offset by an increase in
corporate-related expenses.
Liquidity and Capital Resources
The major sources of capital for the Company have historically been cash flow
from operations and proceeds of long-term borrowing under the Company's bank
credit facilities, together with the funds supplied by the Company's initial
stock offering in April 1984 and subsequent stock offerings in July 1991,
October 1993, June 1996, May 1997 and September 1997. As of September 30, 1997,
the Company had $876,150,000 outstanding under its $1,750,000,000 revolving
long-term line of credit facility, a total of $9,575,000 in a guaranty to a
third party, and $21,254,293 in letters of credit, leaving $843,020,707
available for future borrowings under the credit facility. In addition, the
Company had $35,178,250 in unrestricted cash and cash equivalents on hand at
September 30, 1997. Funding for the acquisition of the radio stations, the cash
portion of the purchase price of Eller, the additional billboard faces and the
refinancing of the $417,000,000 long-term debt in the acquisition of Eller was
provided by cash flow from operations and the Company's credit facility as
amended on April 10, 1997 to increase the total amount available from
$1,040,000,000 to $1,750,000,000. The credit facility will convert to a reducing
revolving line of credit on the last business day of June 2000, with quarterly
reduction of the outstanding commitment to begin the last business day of
September 2000 and continue during the subsequent five year period, with the
entire balance to be repaid by the last business day of September 2005. The
Company believes that cash flow from operations as well as the proceeds from
securities offerings made by the Company from time to time will be sufficient to
make all required future interest and principal payments on the credit facility
and will be sufficient to fund all anticipated capital expenditures.
On May 14, 1997, the Company completed its offering of 5,093,790 shares of
common stock. The net proceeds to the Company were $288,443,000, which was used
to pay down the outstanding balance under the credit facility.
On September 12, 1997, the Company completed its offering of eight million
shares of common stock under the shelf registration statement. The net proceeds
to the Company were $502,684,000, which was used to reduce the outstanding
balance under the credit facility.
During October, the Company completed its offering of $300 million aggregate
principal amount of 7.25% Debentures due October 15, 2027 from its shelf
registration. The net proceeds to the Company were $292,689,000 which was used
to pay down the outstanding balance under the credit facility. In addition, in
connection with the first closing of the Paxson acquisition the Company loaned
to Paxson $398,050,000. This loan matures on the day the acquisition is
consummated or in six months after the termination of the TBA's, which ever
occurs first at an annual interest rate of 10%.
Future acquisitions of radio and televisions stations and other media-related
properties, including the acquisitions of certain radio stations from Paxson and
the Universal Merger, affected in connection with the implementation of the
Company's acquisition strategy are expected to be financed from increased
borrowings under the credit facility and cash from operations.
During the first nine months of the year, the Company made principal payments on
the credit facility totaling $861,150,000 and purchased capital equipment
totaling $22,569,000. In addition during 1997, the Company purchased the
following radio broadcasting and outdoor assets:
RADIO
<TABLE>
<CAPTION>
Station Location Acquisition Date Purchase Price
<S> <C> <C> <C>
WZZU-FM Fuquay-Varina (Raleigh), NC January 31, 1997 $ 6,582,000
WQMF-FM, WHKW-FM Jeffersonville, IN
(Louisville, KY) January 31, 1997 $13,500,000
KHOM-FM Houma (New Orleans), LA February 5, 1997 $ 6,854,000
KJOJ-AM Conroe (Houston), TX February 5, 1997 $ 984,000
WVTI-FM Holland (Grand Rapids), MI February 28, 1997 $ 4,100,000
WTMM-AM, WQBK-FM
WQBJ-FM, WXCR-FM (1) Albany, NY March 14, 1997 $ 7,500,000
WMIL-FM
WOKY-AM Milwaukee, WI March 31, 1997 $41,246,000
WKII-AM, WXRM-FM
WOLZ-FM Ft. Myers, FL April 10, 1997 $11,000,000
WMFX-FM, WOIC-AM Columbia, SC August 15, 1997 $ 5,466,000
WLAN-AM/FM Lancaster, PA August 20, 1997 $ 7,000,000
WDUR-AM, WFXC-FM,
WFXK-FM Raleigh, NC September 15, 1997 $16,500,000
</TABLE>
(1) The broadcasting assets of these stations were purchased by the Company's
80%-owned subsidiary, Radio Enterprises, Inc.
OUTDOOR
During the second quarter, the Company acquired approximately 93% of the
outstanding stock of Eller for total consideration of approximately
$678,000,000, consisting of approximately $329,000,000 in cash and 6,643,636
shares of the Company's common stock (approximately $298,000,000 in common stock
based on a price per share of $44.8625) and issued options on the Company's
common stock with an aggregate value of approximately $51,000,000. The Company
also indirectly assumed $417,000,000 of long-term debt from Eller and
immediately refinanced that long-term debt using the credit facility. Also,
during the second and third quarters the Company purchased additional billboard
faces in several markets for approximately $139,000,000.
Risks Regarding Forward Looking Statements
Except for the historical information, this report contains various
"forward-looking statements" which represent the Company's expectations or
beliefs concerning future events, including the future levels of cash flow from
operations. The Company cautions that these forward-looking statements involve a
number of risks and uncertainties and are subject to many variables which could
have an adverse effect upon the Company's financial performance. These variables
include economic conditions, the ability of the Company to integrate the
operations of Eller and Paxson, shifts in population and other demographics,
level of competition for advertising dollars, fluctuations in operating costs,
technological changes and innovations, changes in labor conditions, changes in
governmental regulations and policies, and certain other factors set forth in
the Company's SEC filings. Actual results in the future could differ materially
from those described in the forward-looking statements.
<PAGE>
Part II -- OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits. See Exhibit Index on Page 16
(b) Reports on Form 8-K
NONE
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CLEAR CHANNEL COMMUNICATIONS, INC.
Date November 6, 1997 /s/ L. Lowry Mays
L. Lowry Mays - Chairman and
Chief Executive Officer
Date November 6, 1997 /s/ Herbert W. Hill, Jr.
Herbert W. Hill, Jr.
Senior Vice President and
Chief Accounting Officer
<PAGE>
Index to Exhibits
4.2 -- Senior Indenture dated October 1, 1997, by and between Clear
Channel Communications and the Bank of New York as Trustee.
(u) 3.1 -- Current Articles of Incorporation of Registrant
(u) 3.2 -- Second Amended and Restated Bylaws of Registrant
(a) 4 -- Buy-Sell Agreement among Clear Channel Communications, Inc.,
L. Lowry Mays, B. J. McCombs, John M. Schaefer and
John W. Barger dated May 31, 1977.
(a) 10.1 -- Incentive Stock Option Plan of Clear Channel Communications,
Inc. as of January 1, 1984.
(b) 10.2 -- Television Asset Purchase Agreement dated January 27, 1992, by
and between Chase Broadcasting of Memphis, Inc. and
Clear Channel Television, Inc.
(b) 10.3 -- Radio Asset Purchase Agreement dated January 31, 1992, by and
between Noble Broadcasting of Connecticut, Inc. and
Clear Channel Radio, Inc.
(b) 10.4 -- Radio Asset Purchase Agreement dated April 19, 1992, by and
between Edens Broadcasting, Inc. and Clear Channel Radio, Inc.
(k) 10.5 -- Radio Asset Purchase Agreement dated January 31, 1993, by and
between KHFI Venture, LTD. and Clear Channel Radio, Inc.
(l) 10.6 -- Radio Asset Purchase Agreement dated December 28, 1992, by and
between Westinghouse Broadcasting Company, Inc. and
Clear Channel Radio, Inc.
(c) 10.7 -- Radio Asset Purchase Agreement dated December 23, 1992, by
and between Inter-Urban Broadcasting of New Orleans
Partnership and Snowden Broadcasting, Inc.
(d) 10.8 -- Television Asset Purchase Agreement dated August 19, 1993,
by and between Television Marketing Group of Memphis,
Inc. and Clear Channel Television, Inc.
(e) 10.9 -- Radio Asset Purchase Agreement April 1, 1993, by and Capital
Broadcasting of Virginia, Inc. and Clear Channel Radio, Inc.
(f) 10.10 -- Television Asset Purchase Agreement dated August 31, 1993, by
and between Nationwide Communications, Inc. and Clear
Channel Television, Inc.
(g) 10.11 -- Radio Asset Merger Agreement dated March 22, 1994, by and
between Metroplex Communications, Inc. and Clear Channel
Radio, Inc.
(h) 10.12 -- Radio Partnership Interest Purchase Agreement dated April 5,
1994, by and between Cook Inlet Communications, Inc. and WCC
Associates and Clear Channel Radio, Inc.
(i) 10.13 -- Television Asset Purchase Agreement dated September 12, 1994,
by and between Heritage Broadcasting Company of New York, Inc.
and Clear Channel Television, Inc. and Clear Channel Television
Licenses, Inc.
(j) 10.14 -- Radio Asset Purchase Agreement dated November 17, 1994, by and
between Noble Broadcast of Houston, Inc. and Clear
Channel Radio, Inc.
(k) 10.15 -- Australian Radio Network Shareholders Agreement dated February,
1995, by and between APN Broadcasting Investments Pty Ltd,
Australian Provincial Newspapers Holdings Limited, APN
Broadcasting Pty Ltd and Clear Channel Radio, Inc. and Clear
Channel Communications, Inc.
(m) 10.16 -- Clear Channel Communications, Inc. 1994 Incentive Stock Option
Plan.
(m) 10.17 -- Clear Channel Communications, Inc. 1994 Nonqualified Stock
Option Plan.
(m) 10.18 -- Clear Channel Communications, Inc. Directors' Nonqualified
Stock Option Plan.
(m )10.19 -- Option Agreement for Officer
(s) 10.20 -- Employment Agreement between Clear Channel Communications, Inc.
and L. Lowry Mays
(n) 10.21 -- Stock Purchase Agreement dated as of March 4, 1996 by and among
US Radio Stations, L.P., Blackstone USR Capital Partners
L.P., Blackstone USR Offshore Capital Partners L.P., Blackstone
Family Investment Partnership II L.P., BCP Radio L.P., BCP
Offshore Radio L.P., US Radio Inc., Clear Channel
Communications of Memphis, Inc. and Clear Channel
Communications, Inc.
(o) 10-22 -- Asset Purchase Agreement, dated as of May 9, 1996, by
and among REP New England G.P., REP Southeast G.P., REP Ft.
Myers G.P., REP Rhode Island G.P., REP Florida G.P., REP WHYN
G.P., REP WWBB G.P.,S.E. Licensee G.P., REP WCKT G.P. and RI
Licensee G.P., Radio Station Management, Inc., Clear Channel
Radio, Inc., and Clear Channel Radio Licenses, Inc.
(p) 10.23 -- Tender Offer between Clear Channel Radio, Inc. and Heftel
Broadcasting Corporation dated June 1, 1996
(p) 10.24 -- Stock Purchase Agreement between Clear Channel Radio, Inc. and
certain shareholders of Heftel Broadcasting Corporation dated
June 1, 1996.
(q) 10.25 -- Agreement and Plan of Merger Between Clear Channel
Communications, Inc. ("PARENT") and Tichenor Media System, Inc.
("TICHENOR") dated July 9, 1996.
(r) 10.26 -- Stock Purchase Agreement by and among Clear Channel
Communications, Inc., Eller Media Corporation and the
Stockholders of Eller Media Corporation dated February 25, 1997.
(s) 10.27 -- Amendment to Stock Purchase Agreement by and among Clear Channel
Communications, Inc., Eller Media Corporation and the
Stockholders of Eller Media Corporation dated April 10, 1997.
(s) 10.28 -- Registration Rights Agreement by and among Clear Channel
Communications, Inc. and the Stockholders of Eller Media
Corporation dated April 10, 1997.
(s) 10.29 -- Escrow Agreement by and among Clear Channel Communications,
Inc., Paul Meyer ("Stockholder Representative"), EM
Holdings LLC, and Chase Trust Company of California, dated
April 10, 1997.
(s) 10.30 -- Stockholders Agreement by and among Eller Media Corporation,
Clear Channel Communications, Inc. and EM Holdings LLC, dated
April 9, 1997.
(t) 10.31 -- Third Amended and Restated Credit Agreement by and
among Clear Channel Communications, Inc., NationsBank of Texas,
N.A., as administrative lender, the First National Bank of
Boston, as documentation agent, the Bank of Montreal and Toronto
Dominion (Texas), Inc., as co-syndication agents, and certain
other lenders dated April 10, 1997.
(v) 10.32 -- First Amendment to Third Amended and Restated Credit Agreement
by and among Clear Channel Communications, Inc., NationsBank of
Texas, N.A., as administrative lender, the First National Bank
of Boston, as documentation agent, the Bank of Montreal and
Toronto Dominion (Texas), Inc., as co-syndication agents, and
certain other lenders dated September 17, 1997.
(w) 10.33 -- Agreement and Plan of Merger dated as of October 23, 1997,
among Universal Outdoor Holdings, Inc., Clear Channel
Communications, Inc. and UH Merger Sub, Inc. Voting Agreement
dated as of October 23, 1997, by and among Clear Channel
Communications, Inc. and Daniel L. Simon. Voting Agreement
dated as of October 23, 1997, by and among Clear Channel
Communications, Inc. and Brian T. Clingen.
(x) 10.34 -- Asset Purchase Agreement by and among Paxson Communications
Corporation, Clear Channel Metroplex, Inc., Clear Channel
Metroplex Licenses, Inc., and Clear Channel Communications,
Inc., dated August 25, 1997.
(x) 10.35 -- Asset Purchase Agreement by and among Paxson Communications
Corporation, L. Paxson, Inc., Clear Channel Metroplex, Inc.,
Clear Channel Metroplex Licenses, Inc., and Clear Channel
Communications, Inc., dated August 25, 1997.
27 -- Financial Data Schedule
<PAGE>
(a) -- Incorporated by reference to the exhibits of the Registrant's
Registration Statement on Form S-1(Reg. No. 289161) dated
April 19, 1984.
(b) -- Incorporated by reference to the Registrant's Form 8-K dated
July 14, 1992.
(c) -- Incorporated by reference to the Registrant's Form 10-Q dated
May 12, 1993.
(d) -- Incorporated by reference to the Registrant's Form 8-K dated
September 2, 1993.
(e) -- Incorporated by reference to the Registrant's Form 10-Q dated
November 1, 1993.
(f) -- Incorporated by reference to the Registrant's Form 8-K dated
October 27, 1993.
(g) -- Incorporated by reference to the Registrant's Form 8-K dated
October 26, 1994.
(h) -- Incorporated by reference to the Registrant's Form 10-Q dated
November 14 1994.
(i) -- Incorporated by reference to the Registrant's Form 8-K dated
December 14, 1994.
(j) -- Incorporated by reference to the Registrant's Form 8-K dated
January 13, 1995.
(k) -- Incorporated by reference to the Registrant's Form 8-K dated
May 26, 1995.
(l) -- Incorporated by reference to the Registrant's Form 10-Q dated
November 14, 1995.
(m) -- Incorporated by reference to the Registrant's Form S-8 dated
November 20, 1995.
(n) -- Incorporated by reference to the Registrant's Form 8-K dated
May 4, 1996.
(o) -- Incorporated by reference to the Registrant's Form 8-K dated
June 5, 1996.
(p) -- Incorporated by reference to the Registrant's Form S-3 dated
June 14, 1996.
(q) -- Incorporated by reference to Heftel Broadcasting Corporation's
Amendment 2 to Form SC 14D1/A dated July 9, 1996.
(r) -- Incorporated by reference to the Registrant's Form 10-K dated
March 31, 1997.
(s) -- Incorporated by reference to the Registrant's Form 8-K dated
April 17, 1997.
(t) -- Incorporated by reference to the Registrant's Amendment No. 1 to
Form S-3 Reg. No. 333-25497 dated May 9, 1997.
(u) -- Incorporated by reference to the Registrant's Form S-3
Reg. No. 333-33371 dated August 11, 1997.
(v) -- Incorporated by reference to the Registrant's Form 8-K dated
October 14, 1997.
(w) -- Incorporated by reference to the Registrant's Form 8-K dated
November 3, 1997.
(x) -- Incorporated by reference to the Registrant's Amendment No. 1 to
Form S-3 Reg No. 333-33371 dated September 2, 1997.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 35,178
<SECURITIES> 0
<RECEIVABLES> 138,435
<ALLOWANCES> 11,679
<INVENTORY> 0
<CURRENT-ASSETS> 178,058
<PP&E> 783,456
<DEPRECIATION> 115,626
<TOTAL-ASSETS> 2,791,205
<CURRENT-LIABILITIES> 87,615
<BONDS> 897,588
0
0
<COMMON> 9,809
<OTHER-SE> 1,686,841
<TOTAL-LIABILITY-AND-EQUITY> 2,791,205
<SALES> 0
<TOTAL-REVENUES> 469,176
<CGS> 0
<TOTAL-COSTS> 266,542
<OTHER-EXPENSES> 13,699
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 51,804
<INCOME-PRETAX> 64,556
<INCOME-TAX> 31,641
<INCOME-CONTINUING> 41,301
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 41,301
<EPS-PRIMARY> .47
<EPS-DILUTED> .47
</TABLE>
(Conformed Copy)
============================================================
CLEAR CHANNEL COMMUNICATIONS, INC.
and
THE BANK OF NEW YORK
Trustee
SENIOR INDENTURE
Dated as of October 1, 1997
Providing for Issuance of Securities in Series
============================================================
<PAGE>
TABLE OF CONTENTS
Page
Recitals of the Company.... 1
Agreements of the Parties.. 1
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. Definitions.............................. 1
Act...................................... 2
Affiliate................................ 2
Authenticating Agent..................... 2
Board of Directors....................... 2
Board Resolution......................... 2
Business Day............................. 2
Commission............................... 2
Company.................................. 2
Company Request, Company Order and
Company Consent.......................... 2
Corporate Trust Office................... 2
Debt..................................... 3
Defaulted Interest....................... 3
Depositary............................... 3
Event of Default......................... 3
Funded Debt.............................. 3
Global Security.......................... 3
Holder................................... 3
Indenture, this Indenture................ 3
Interest................................. 4
Interest Payment Date.................... 4
Maturity................................. 4
Mortgage................................. 4
Officers' Certificate.................... 4
Opinion of Counsel....................... 4
Original Issue Discount Security......... 4
Outstanding.............................. 4
Paying Agent............................. 5
Permitted Mortgage....................... 5
Person................................... 6
Place of Payment......................... 6
Predecessor Securities................... 6
Principal Property....................... 6
Redemption Date.......................... 6
Redemption Price......................... 6
Regular Record Date...................... 6
Repayment Date........................... 6
<PAGE>
Contents, p. 2
Page
Repayment Price.......................... 6
Responsible Officer...................... 6
Restricted Subsidiary.................... 7
Security or Securities................... 7
Security Register........................ 7
Security Registrar....................... 7
Securityholder........................... 7
Special Record Date...................... 7
Stated Maturity.......................... 7
Subsidiary............................... 7
Trust Indenture Act or TIA............... 7
Trustee.................................. 7
U.S. Government Obligations.............. 7
Vice President........................... 8
Voting Stock............................. 8
Section 102. Compliance Certificates and Opinions..... 8
Section 103. Form of Documents Delivered to Trustee.. 8
Section 104. Acts of Securityholders.................. 9
Section 105. Notices, etc., to Trustee and Company.... 10
Section 106. Notices to Securityholders; Waiver....... 10
Section 107. Conflict with Trust Indenture Act........ 10
Section 108. Effect of Headings and Table of Contents. 11
Section 109. Successors and Assigns................... 11
Section 110. Separability Clause...................... 11
Section 111. Benefits of Indenture.................... 11
Section 112. Governing Law............................ 11
Section 113. Counterparts............................. 11
Section 114. Judgment Currency........................ 11
ARTICLE TWO
Security Forms
Section 201. Forms Generally........................... 12
Section 202. Forms of Securities....................... 12
Section 203. Form of Trustee's Certificate of
Authentication............................ 12
Section 204. Securities Issuable in the Form of a
Global Security........................... 12
<PAGE>
Contents, p. 3
Page
ARTICLE THREE
The Securities
Section 301. General Title; General Limitations; Issuable in
Series; Terms of Particular Series................ 14
Section 302. Denominations..................................... 16
Section 303. Execution, Authentication and Delivery and Dating. 16
Section 304. Temporary Securities.............................. 18
Section 305. Registration, Transfer and Exchange............... 18
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.. 19
Section 307. Payment of Interest; Interest Rights Preserved.... 20
Section 308. Persons Deemed Owners............................. 21
Section 309. Cancellation...................................... 21
Section 310. Computation of Interest........................... 21
Section 311. Medium-Term Securities............................ 21
Section 312. CUSIP Numbers..................................... 22
Section 313. Global Securities................................. 22
ARTICLE FOUR
Satisfaction and Discharge of Indenture;
Defeasance; Unclaimed Moneys
Section 401. Applicability of Article.......................... 23
Section 402. Satisfaction and Discharge of Indenture;
Defeasance........................................ 23
Section 403. Conditions of Defeasance.......................... 24
Section 404. Application of Trust Money........................ 25
Section 405. Repayment to Company.............................. 25
Section 406. Indemnity for U.S. Government Obligations......... 26
Section 407. Reinstatement..................................... 26
ARTICLE FIVE
Remedies
Section 501. Events of Default................................. 26
Section 502. Acceleration of Maturity; Rescission and Annulment 27
<PAGE>
Contents, p. 4
Page
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee............................ 28
Section 504. Trustee May File Proofs of Claim.................. 29
Section 505. Trustee May Enforce Claims Without Possession
of Securities..................................... 30
Section 506. Application of Money Collected.................... 30
Section 507. Limitation on Suits............................... 30
Section 508. Unconditional Right of Securityholders to Receive
Principal, Premium and Interest................... 31
Section 509. Restoration of Rights and Remedies................ 31
Section 510. Rights and Remedies Cumulative.................... 31
Section 511. Delay or Omission Not Waiver...................... 31
Section 512. Control by Securityholders........................ 31
Section 513. Waiver of Past Defaults........................... 32
Section 514. Undertaking for Costs............................. 32
Section 515. Waiver of Stay or Extension Laws.................. 32
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities............... 33
Section 602. Notice of Defaults................................ 34
Section 603. Certain Rights of Trustee......................... 34
Section 604. Not Responsible for Recitals or Issuance
of Securities..................................... 34
Section 605. May Hold Securities............................... 35
Section 606. Money Held in Trust............................... 35
Section 607. Compensation and Reimbursement.................... 35
Section 608. Disqualification; Conflicting Interests........... 35
Section 609. Corporate Trustee Required; Eligibility........... 36
Section 610. Resignation and Removal; Appointment of Successor. 36
Section 611. Acceptance of Appointment by Successor........... 37
<PAGE>
Contents, p. 5
Page
Section 612. Merger, Conversion, Consolidation or Succession
to Business....................................... 38
Section 613. Preferential Collection of Claims Against Company. 38
Section 614. Appointment of Authenticating Agent............... 41
ARTICLE SEVEN
Securityholders' Lists and Reports by Trustee and
Company
Section 701. Company to Furnish Trustee Names and Addresses
of Securityholders................................ 43
Section 702. Preservation of Information; Communications to
Securityholders................................... 43
Section 703. Reports by Trustee................................ 44
Section 704. Reports by Company................................ 45
ARTICLE EIGHT
Consolidation, Merger, Conveyance or Transfer
Section 801. Company May Consolidate, etc., only on
Certain Terms..................................... 46
Section 802. Successor Corporation Substituted................. 46
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of
Securityholders................................... 47
Section 902. Supplemental Indentures with Consent of
Securityholders................................... 48
Section 903. Execution of Supplemental Indentures.............. 48
Section 904. Effect of Supplemental Indentures................. 49
Section 905. Conformity with Trust Indenture Act............... 49
Section 906. Reference in Securities to Supplemental
Indentures........................................ 49
<PAGE>
Contents, p. 6
Page
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest........ 49
Section 1002. Maintenance of Office or Agency................... 49
Section 1003. Money for Security Payments to Be Held in Trust... 49
Section 1004. Statement as to Compliance........................ 51
Section 1005. Corporate Existence............................... 51
Section 1006. Limitation on Mortgages........................... 51
Section 1007. Limitation on Sale and Leaseback Transactions..... 52
Section 1008. Waiver of Certain Covenants....................... 52
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.......................... 52
Section 1102. Election to Redeem; Notice to Trustee............. 53
Section 1103. Selection by Trustee of Securities to Be Redeemed. 53
Section 1104. Notice of Redemption.............................. 53
Section 1105. Deposit of Redemption Price....................... 54
Section 1106. Securities Payable on Redemption Date............. 54
Section 1107. Securities Redeemed in Part....................... 54
Section 1108. Provisions with Respect to any Sinking Funds...... 55
<PAGE>
THIS SENIOR INDENTURE (the "Indenture") between CLEAR CHANNEL
COMMUNICATIONS, INC., a Texas corporation (hereinafter called the
"Company") having its principal office at 200 Concord Plaza, Suite 600,
San Antonio, Texas 78216, and THE BANK OF NEW YORK, a New York banking
corporation, trustee (hereinafter called the "Trustee"), is made and
entered into as of this 1st day of October 1997.
Recitals of the Company
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance of its Securities, notes, bonds or
other evidences of indebtedness, to be issued in one or more fully registered
series.
All things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
Agreements of the Parties
To set forth or to provide for the establishment of the terms
and conditions upon which the Securities are and are to be authenticated, issued
and delivered, and in consideration of the premises and the purchase of
Securities by the Holders thereof, it is mutually covenanted and agreed as
follows, for the equal and proportionate benefit of all Holders of the
Securities or of a series thereof, as the case may be:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions. For all purposes of this
Indenture and of any indenture supplemental hereto, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article, and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act or by Commission rule under the Trust Indenture Act,
either directly or by reference therein, have the meanings assigned to
them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with
respect to any computation required or permitted hereunder shall mean
such accounting principles as are generally accepted in the United
States of America at the date of such computation;
<PAGE>
(4) all references in this instrument to designated
"Articles", "Sections" and other subdivisions are to the designated
Articles, Sections and other subdivisions of this instrument as
originally executed. The words "herein", "hereof" and "hereunder" and
other words of similar import refer to this Indenture as a whole and
not to any particular Article, Section or other subdivision; and
(5) "including" and words of similar import shall be deemed to
be followed by "without limitation".
Certain terms, used principally in Article Six, are defined in
that Article.
"Act", when used with respect to any Securityholder, has the
meaning specified in Section 104.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the
Trustee to authenticate Securities under Section 614.
"Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee. 3
"Business Day" means each day which is neither a Saturday,
Sunday or other day on which banking institutions in the pertinent Place or
Places of Payment are authorized or required by law or executive order to be
closed.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934, or, if at any time after the execution of this instrument such Commission
is not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties on such date.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor corporation.
"Company Request", "Company Order" and "Company Consent" mean,
respectively, a written request, order or consent signed in the name of the
Company by its Chairman of the Board, President or a Vice President, and by its
Treasurer, an Assistant Treasurer, Controller, an Assistant Controller,
Secretary or an Assistant Secretary, and delivered to the Trustee.
<PAGE>
"Corporate Trust Office" means the principal office of the
Trustee in New York, New York at which at any particular time its corporate
trust business shall be principally administered, which office at the date
hereof is located at 101 Barclay Street, 21st Floor, New York, New York 10286,
except that with respect to the presentation of Securities for payment or for
registration of transfer and exchange, such term shall mean the office or the
agency of the Trustee in said city at which at any particular time its corporate
agency business shall be conducted, which office at the date hereof is located
at 101 Barclay Street, 21st Floor, New York, New York 10286.
"Debt" means indebtedness for money borrowed.
"Defaulted Interest" has the meaning specified in Section 307.
"Depositary" means, unless otherwise specified by the Company
pursuant to either Section 204 or 301, with respect to Securities of any series
issuable or issued as a Global Security, The Depository Trust Company, New York,
New York, or any successor thereto registered as a clearing agency under the
Securities Exchange Act of 1934, as amended, or other applicable statute or
regulation.
"Event of Default" has the meaning specified in Article Five.
"Funded Debt" of any person means all indebtedness for
borrowed money created, incurred, assumed or guaranteed in any manner by such
person, and all indebtedness, contingent or otherwise, incurred or assumed by
such person in connection with the acquisition of any business, property or
asset, which in each case matures more than one year after, or which by its
terms is renewable or extendible or payable out of the proceeds of similar
indebtedness incurred pursuant to the terms of any revolving credit agreement or
any similar agreement at the option of such person for a period ending more than
one year after the date as of which Funded Debt is being determined; provided,
however, that Funded Debt shall not include (i) any indebtedness for the
payment, redemption or satisfaction of which money (or evidences of
indebtedness, if permitted under the instrument creating or evidencing such
indebtedness) in the necessary amount shall have been irrevocably deposited in
trust with a trustee or proper depository either on or before the maturity or
redemption date thereof or (ii) any indebtedness of such person to any of its
Subsidiaries or of any Subsidiary to such person or any other Subsidiary or
(iii) any indebtedness incurred in connection with the financing of operating,
construction or acquisition projects, provided that the recourse for such
indebtedness is limited to the assets of such projects.
"Global Security" means with respect to any series of
Securities issued hereunder, a Security which is executed by the Company and
authenticated and delivered by the Trustee to the Depositary or pursuant to the
Depositary's instruction, all in accordance with this Indenture and an indenture
supplemental hereto, if any, or Board Resolution and pursuant to a Company
Request, which shall be registered in the name of the Depositary or its nominee
and which shall represent, and shall be denominated in an amount equal to the
aggregate principal amount of, all of the Outstanding Securities of such series
or any portion thereof, in either case having the same terms, including, without
limitation, the same original issue date, date or dates on which principal is
due, and interest rate or method of determining interest.
"Holder", when used with respect to any Security, means a
Securityholder.
"Indenture" or "this Indenture" means this instrument as
originally executed or as it may from time to time be supplemented or amended by
one or more indentures supplemental hereto entered into pursuant to the
applicable provisions hereof and shall include the terms of particular series of
Securities established as contemplated by Section 301.
<PAGE>
"Interest", when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date", when used with respect to any series
of Securities, means the Stated Maturity of any installment of interest on those
Securities.
"Maturity", when used with respect to any Securities, means
the date on which the principal of any such Security becomes due and payable as
therein or herein provided, whether on a Repayment Date, at the Stated Maturity
or by declaration of acceleration, call for redemption or otherwise.
"Mortgage" means any mortgage, pledge, lien, encumbrance,
charge or security interest of any kind.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, the President or a Vice President, and by the Treasurer,
an Assistant Treasurer, the Controller, an Assistant Controller, the Secretary
or an Assistant Secretary of the Company, and delivered to the Trustee. Wherever
this Indenture requires that an Officers' Certificate be signed also by an
engineer or an accountant or other expert, such engineer, accountant or other
expert (except as otherwise expressly provided in this Indenture) may be in the
employ of the Company, and shall be acceptable to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who
may (except as otherwise expressly provided in this Indenture) be an employee of
or of counsel to the Company. Such counsel shall be acceptable to the Trustee,
whose acceptance shall not be unreasonably withheld.
"Original Issue Discount Security" means (i) any Security
which provides for an amount less than the principal amount thereof to be due
and payable upon a declaration of acceleration of the Maturity thereof, and (ii)
any other Security deemed an Original Issue Discount Security for United States
Federal income tax purposes.
"Outstanding", when used with respect to Securities or
Securities of any series, means, as of the date of determination, all such
Securities theretofore authenticated and delivered under this Indenture,
except: 6
(i) such Securities theretofore canceled by the Trustee
or delivered to the Trustee for cancellation;
(ii) such Securities for whose payment or redemption money in
the necessary amount has been theretofore deposited with the Trustee or
any Paying Agent in trust for the Holders of such Securities; provided
that, if such Securities are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and
(iii) such Securities in exchange for or in lieu of which
other Securities have been authenticated and delivered pursuant to this
Indenture, or which shall have been paid pursuant to the terms of
Section 306 (except with respect to any such Security as to which proof
satisfactory to the Trustee is presented that such Security is held by
a person in whose hands such Security is a legal, valid and binding
obligation of the Company).
<PAGE>
In determining whether the Holders of the requisite principal amount of such
Securities Outstanding have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, (i) the principal amount of any Original
Issue Discount Security that shall be deemed to be Outstanding shall be the
amount of the principal thereof that would be due and payable as of the date of
the taking of such action upon a declaration of acceleration of the Maturity
thereof and (ii) Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor shall be
disregarded and deemed not to be Outstanding. In determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Securities which a Responsible
Officer assigned to the corporate trust department of the Trustee knows to be
owned by the Company or any other obligor upon the Securities or any Affiliate
of the Company or such other obligor shall be so disregarded. Securities so
owned which have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Trustee the pledgee's right
to act as owner with respect to such Securities and that the pledgee is not the
Company or any other obligor upon the Securities or any Affiliate of the Company
or such other obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of (and premium, if any) or interest on any Securities on
behalf of the Company.
"Permitted Mortgage" means (i) any Mortgage upon property
owned or leased by a corporation existing at the time such corporation becomes a
Restricted Subsidiary, (ii) any Mortgage upon property existing at the time of
the acquisition thereof or to secure payment of any part of the purchase price
thereof or any Debt incurred to finance the purchase thereof, (iii) any Mortgage
upon property to secure any part of the cost of development, construction,
alteration, repair or improvement of such property, or Debt incurred to finance
such cost, (iv) any Mortgage securing Debt of a Restricted Subsidiary owing to
the Company or to another Restricted Subsidiary, (v) any Mortgage existing on
the date of this Indenture, (vi) Mortgages on property of the Company or a
Restricted Subsidiary in favor of the United States of America or any State or
political subdivision thereof, or in favor of any other country or any political
subdivision thereof, to secure payment pursuant to any contract or statute or to
secure any indebtedness incurred for the purpose of financing all or part of the
purchase price or the cost of construction or improvement of the property
subject to such Mortgages; (vii) Mortgages on any property subsequently acquired
by the Company or any Restricted Subsidiary, contemporaneously with such
acquisition or within 120 days thereafter, to secure or provide for the payment
of any part of the purchase price of such property, or Mortgages assumed by the
Company or any Restricted Subsidiary upon any property subsequently acquired by
the Company or any Restricted Subsidiary which were existing at the time of such
acquisition, provided that the amount of any Indebtedness secured by any such
Mortgage created or assumed does not exceed the cost to the Company or
Restricted Subsidiary, as the case may be, of the property covered by such
Mortgage; and (viii) any extension, renewal or replacement, in whole or in part,
of any Mortgage referred to in the foregoing clauses (i) through (vii);
provided, however, that the principal amount of Debt secured thereby shall not
exceed the principal amount of Debt so secured at the time of such extension,
renewal or replacement and provided, further, that such Mortgage shall be
limited to all or such part of the property which secured the Mortgage so
extended, renewal or replaced.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
<PAGE>
"Place of Payment" means with respect to any series of
Securities issued hereunder the city or political subdivision so designated with
respect to the series of Securities in question in accordance with the
provisions of Section 301.
"Predecessor Securities" of any particular Security means
every previous Security evidencing all or a portion of the same debt as that
evidenced by such particular Security; and, for the purposes of this definition,
any Security authenticated and delivered under Section 306 in lieu of a lost,
destroyed or stolen Security shall be deemed to evidence the same debt as the
lost, destroyed or stolen Security.
"Principal Property" means any radio broadcasting, television
broadcasting or outdoor advertising property located in the United States owned
or leased by the Company or any Subsidiary, unless, in the opinion of the Board
of Directors of the Company, of such properties are not in the aggregate of
material importance to the total business conducted by the Company and its
Subsidiaries as an entirety.
"Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to
be redeemed, means the price specified in the Security at which it is to be
redeemed pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Security
on any Interest Payment Date means the date specified in such Security as the
Regular Record Date.
"Repayment Date", when used with respect to any Security to be
repaid, means the date fixed for such repayment pursuant to such Security.
"Repayment Price", when used with respect to any Security to
be repaid, means the price at which it is to be repaid pursuant to such
Security.
"Responsible Officer", when used with respect to the Trustee,
means the chairman or vice-chairman of the board of directors, the chairman or
vice-chairman of the executive committee of the board of directors, the
president, any vice president, the secretary, any assistant secretary, the
treasurer, any assistant treasurer, the cashier, any assistant cashier, any
senior trust officer or trust officer, the controller and any assistant
controller or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his knowledge of and familiarity with
the particular subject.
"Restricted Subsidiary" means each Subsidiary as of the date
of this Indenture and each Subsidiary thereafter created or acquired, unless
expressly excluded by resolution of the Board of Directors before, or within 120
days following, such creation or acquisition.
"Sale-Leaseback Transaction" shall have the meaning specified
in Section 1007.
"Security" or "Securities" means any note or notes, bond or
bonds, debenture or debentures, or any other evidences of indebtedness, as the
case may be, of any series authenticated and delivered from time to time under
this Indenture.
<PAGE>
"Security Register" shall have the meaning specified in
Section 305.
"Security Registrar" means the Person who keeps the Security
Register specified in Section 305.
"Securityholder" means a Person in whose name a Security is
registered in the Security Register.
"Special Record Date" for the payment of any Defaulted
Interest (as defined in Section 307) means a date fixed by the Trustee pursuant
to Section 307.
"Stated Maturity" when used with respect to any Security or
any installment of principal thereof or interest thereon means the date
specified in such Security as the fixed date on which the principal of such
Security or such installment of principal or interest is due and payable.
"Subsidiary" of any specified corporation means any
corporation of which a majority of the outstanding Voting Stock is owned,
directly or indirectly, by the specified corporation or by one or more of its
Subsidiaries, or both.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939, as amended by the Trust Indenture Reform Act of 1990, as in force at
the date as of which this instrument was executed except as provided in Section
905.
"Trustee" means the Person named as the Trustee in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean and include each Person who is then a Trustee hereunder.
If at any time there is more than one such Person, "Trustee" as used with
respect to the Securities of any series shall mean the Trustee with respect to
Securities of that series.
"U.S. Government Obligations" means securities that are (x)
direct obligations of the United States of America for the payment of which its
full faith and credit is pledged or (y) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof.
"Vice President" when used with respect to the Company or the
Trustee means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president", including,
without limitation, an assistant vice president.
"Voting Stock", as applied to the stock of any corporation,
means stock of any class or classes (however designated) having by the terms
thereof ordinary voting power to elect a majority of the members of the board of
directors (or other governing body) of such corporation other than stock having
such power only by reason of the happening of a contingency.
<PAGE>
Section 102. Compliance Certificates and Opinions. Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent, if any, provided
for in this Indenture relating to the proposed action have been complied with
and an Opinion of Counsel stating that in the opinion of such Counsel all such
conditions precedent, if any, have been complied with, except that in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (except for the written
statement required by Section 1004) shall include
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(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 each such individual,
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 complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to the other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
<PAGE>
Section 104. Acts of Securityholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Securityholders or Securityholders of any
series may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Securityholders in person or by an
agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee, and, where it is hereby expressly required, to the
Company. If any Securities are denominated in coin or currency other than that
of the United States, then for the purposes of determining whether the Holders
of the requisite principal amount of Securities have taken any action as herein
described, the principal amount of such Securities shall be deemed to be that
amount of United States dollars that could be obtained for such principal amount
on the basis of the spot rate of exchange into United States dollars for the
currency in which such Securities are denominated (as evidenced to the Trustee
by an Officers' Certificate) as of the date the taking of such action by the
Holders of such requisite principal amount is evidenced to the Trustee as
provided in the immediately preceding sentence. Such instrument or instruments
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Securityholders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Section 601) conclusive in favor of the Trustee and the Company,
if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness to such
execution or by the certificate of any notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by an officer of a corporation or a member of a partnership, on
behalf of such corporation or partnership, such certificate or affidavit shall
also constitute sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of the person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient.
(c) The ownership of Securities shall be proved by the
Security Register.
(d) If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other action, the
Company may, at its option, by Board Resolution, fix in advance a record date
for the determination of Holders entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other action, but the
Company shall have no obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent, waiver or other
action may be given before or after the record date, but only the Holders of
record at the close of business on the record date shall be deemed to be Holders
for the purposes of determining whether Holders of the requisite proportion of
Securities Outstanding have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other action, and
for that purpose the Securities Outstanding shall be computed as of the record
date; provided that no such authorization, agreement or consent by the Holders
on the record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after the
record date.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Security shall bind the
Holder of every Security issued upon the transfer thereof or in exchange
therefor or in lieu thereof, in respect of anything done or suffered to be done
by the Trustee or the Company in reliance thereon whether or not notation of
such action is made upon such Security.
<PAGE>
Section 105. Notices, etc., to Trustee and Company. Any
request, demand, authorization, direction, notice, consent, waiver or Act of
Securityholders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(1) the Trustee by any Securityholder or by the Company shall
be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office,
or
(2) the Company by the Trustee or by any Securityholder shall
be sufficient for every purpose hereunder (except as provided in
Section 501(4) or, in the case of a request for repayment, as specified
in the Security carrying the right to repayment) if in writing and
mailed, first-class postage prepaid, to the Company addressed to it at
the address of its principal office specified in the first paragraph of
this instrument or at any other address previously furnished in writing
to the Trustee by the Company.
Section 106. Notices to Securityholders; Waiver. Where this
Indenture or any Security provides for notice to Securityholders of any event,
such notice shall be sufficiently given (unless otherwise herein or in such
Security expressly provided) if in writing and mailed, first-class postage
prepaid, to each Securityholder affected by such event, at his address as it
appears in the Security Register, not later than the latest date, and not
earlier than the earliest date, prescribed for the giving of such notice. In any
case where notice to Securityholders is given by mail, neither the failure to
mail such notice, nor any defect in any notice so mailed, to any particular
Securityholder shall affect the sufficiency of such notice with respect to other
Securityholders. Where this Indenture or any Security provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Securityholders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
In case, by reason of the suspension of regular mail service
as a result of a strike, work stoppage or otherwise, it shall be impractical to
mail notice of any event to any Securityholder when such notice is required to
be given pursuant to any provision of this Indenture, then any method of
notification as shall be satisfactory to the Trustee and the Company shall be
deemed to be a sufficient giving of such notice.
Section 107. Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with the duties imposed by any
of Sections 310 to 317, inclusive, of the Trust Indenture Act through the
operation of Section 318(c) thereof, such imposed duties shall control.
Section 108. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns. All covenants and
agreements in this Indenture by the Company shall bind its successors and
assigns, whether so expressed or not.
Section 110. Separability Clause. In case any provision in
this Indenture or in the Securities shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
<PAGE>
Section 111. Benefits of Indenture. Nothing in this Indenture
or in any Securities, express or implied, shall give to any Person, other than
the parties hereto and their successors hereunder, any Authenticating Agent or
Paying Agent, the Security Registrar and the Holders of Securities (or such of
them as may be affected thereby), any benefit or any legal or equitable right,
remedy or claim under this Indenture.
Section 112. Governing Law. This Indenture shall be
construed in accordance with and governed by the laws of the State of New York.
Section 113. Counterparts. This instrument may be
executed in any number of counterparts, each of which so executed shall be
deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument.
Section 114. Judgment Currency. The Company agrees, to the
fullest extent that it may effectively do so under applicable law, that (a) if
for the purpose of obtaining judgment in any court it is necessary to convert
the sum due in respect of the principal of, or premium or interest, if any, on
the Securities of any series (the "Required Currency") into a currency in which
a judgment will be rendered (the "Judgment Currency"), the rate of exchange used
shall be the rate at which in accordance with normal banking procedures the
Trustee could purchase in the City of New York the Required Currency with the
Judgment Currency on the New York Banking Day (as defined below) preceding that
on which final unappealable judgment is given and (b) its obligations under this
Indenture to make payments in the Required Currency (i)shall not be discharged
or satisfied by any tender, or any recovery pursuant to any judgment (whether or
not entered in accordance with subsection (a)), in any currency other than the
Required Currency, except to the extent that such tender or recovery shall
result in the actual receipt, by the payee, of the full amount of the Required
Currency expressed to be payable in respect of such payments, (ii) shall be
enforceable as an alternative or additional cause of action for the purpose of
recovering in the Required Currency the amount, if any, by which such actual
receipt shall fall short of the full amount of the Required Currency so
expressed to be payable and (iii) shall not be affected by judgment being
obtained for any other sum due under this Indenture. For purposes of the
foregoing, "New York Banking Day" means any day except a Saturday, Sunday or a
legal holiday in the City of New York or a day on which banking institutions in
the City of New York are authorized or required by law or executive order to
close.
ARTICLE TWO
Security Forms
Section 201. Forms Generally. The Securities shall have such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon,
as may be required to comply with applicable laws or regulations or with the
rules of any securities exchange, or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution of the Securities. Any portion of the text of any Security may be set
forth on the reverse thereof, with an appropriate reference thereto on the face
of the Security.
<PAGE>
The definitive Securities shall be printed, lithographed or
engraved or produced by any combination of these methods on steel engraved
borders or may be produced in any other manner, all as determined by the
officers executing such Securities, as evidenced by their execution of such
Securities, subject, with respect to the Securities of any series, to the rules
of any securities exchange on which such Securities are listed.
Section 202. Forms of Securities. Each Security shall be in
one of the forms approved from time to time by or pursuant to a Board
Resolution, or established in one or more indentures supplemental hereto. Prior
to the delivery of a Security to the Trustee for authentication in any form
approved by or pursuant to a Board Resolution, the Company shall deliver to the
Trustee the Board Resolution by or pursuant to which such form of Security has
been approved, which Board Resolution shall have attached thereto a true and
correct copy of the form of Security which has been approved thereby or, if a
Board Resolution authorizes a specific officer or officers to approve a form of
Security, a certificate of such officer or officers approving the form of
Security attached thereto. Any form of Security approved by or pursuant to a
Board Resolution must be acceptable as to form to the Trustee, such acceptance
to be evidenced by the Trustee's authentication of Securities in that form or a
certificate signed by a Responsible Officer of the Trustee and delivered to the
Company.
Section 203. Form of Trustee's Certificate of Authentication.
The form of Trustee's Certificate of Authentication for any Security issued
pursuant to this Indenture shall be substantially as follows:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee,
Dated:_________________ By:_________________________________________
Authorized Signatory
Section 204. Securities Issuable in the Form of a Global
Security. (a) If the Company shall establish pursuant to Sections 202 and 301
that the Securities of a particular series are to be issued in whole or in part
in the form of one or more Global Securities, then the Company shall execute and
the Trustee or its agent shall, in accordance with Section 303 and the Company
Request delivered to the Trustee or its agent thereunder, authenticate and
deliver, such Global Security or Securities, which (i) shall represent, and
shall be denominated in an amount equal to the aggregate principal amount of,
the Outstanding Securities of such series to be represented by such Global
Security or Securities, or such portion thereof as the Company shall specify in
a Company Request, (ii) shall be registered in the name of the Depositary for
such Global Security or Securities or its nominee, (iii) shall be delivered by
the Trustee or its agent to the Depositary or pursuant to the Depositary's
instruction and (iv) shall bear a legend substantially to the following effect:
"Unless and until it is exchanged in whole or in part for the individual
Securities represented hereby, this Global 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."
<PAGE>
(b) Notwithstanding any other provisions of this Section 204
or of Section 305, and subject to the provisions of paragraph (c) below, unless
the terms of a Global Security expressly permit such Global Security to be
exchanged in whole or in part for individual Securities, a Global Security may
be transferred, in whole but not in part and in the manner provided in Section
305, only to a nominee of the Depositary for such Global Security, or to the
Depositary, or a successor Depositary for such Global Security selected or
approved by the Company, or to a nominee of such successor Depositary.
(c) (i) If at any time the Depositary for a Global Security
notifies the Company that it is unwilling or unable to continue as Depositary
for such Global Security or if at any time the Depositary for the Securities for
such series ceases to be a clearing agency registered under the Securities
Exchange Act of 1934, as amended, or other applicable statute or regulation, the
Company shall appoint a successor Depositary with respect to such Global
Security. If a successor Depositary for such Global Security is not appointed by
the Company within 90 days after the Company receives such notice or becomes
aware of such ineligibility, the Company will execute, and the Trustee or its
agent, upon receipt of a Company Request for the authentication and delivery of
individual Securities of such series in exchange for such Global Security, will
authenticate and deliver, individual Securities of such series of like tenor and
terms in an aggregate principal amount equal to the principal amount of the
Global Security in exchange for such Global Security.
(ii) The Company may at any time and in its sole discretion
determine that the Securities of any series or portion thereof issued or
issuable in the form of one or more Global Securities shall no longer be
represented by such Global Security or Securities. In such event the Company
will execute, and the Trustee, upon receipt of a Company Request for the
authentication and delivery of individual Securities of such series in exchange
in whole or in part for such Global Security, will authenticate and deliver
individual Securities of such series of like tenor and terms in definitive form
in an aggregate principal amount equal to the principal amount of such Global
Security or Securities representing such series or portion thereof in exchange
for such Global Security or Securities.
(iii) If specified by the Company pursuant to Sections 202 and
301 with respect to Securities issued or issuable in the form of a Global
Security, the Depositary for such Global Security may surrender such Global
Security in exchange in whole or in part for individual Securities of such
series of like tenor and terms in definitive form on such terms as are
acceptable to the Company and such Depositary. Thereupon the Company shall
execute, and the Trustee or its agent shall authenticate and deliver, without
service charge, (1) to each Person specified by such Depositary a new Security
or Securities of the same series of like tenor and terms and of any authorized
denomination as requested by such Person in aggregate principal amount equal to
and in exchange for such Person's beneficial interest in the Global Security;
and (2) to such Depositary a new Global Security of like tenor and terms and in
an authorized denomination equal to the difference, if any, between the
principal amount of the surrendered Global Security and the aggregate principal
amount of Securities delivered to the Holders thereof.
<PAGE>
(iv) In any exchange provided for in any of the preceding
three paragraphs, the Company will execute and the Trustee or its agent will
authenticate and deliver individual Securities in definitive registered form in
authorized denominations. Upon the exchange of the entire principal amount of a
Global Security for individual Securities, such Global Security shall be
canceled by the Trustee or its agent. Except as provided in the preceding
paragraph, Securities issued in exchange for a Global Security pursuant to this
Section shall be registered in such names and in such authorized denominations
as the Depositary for such Global Security, pursuant to instructions from its
direct or indirect participants or otherwise, shall instruct the Trustee or the
Security Registrar. The Trustee or the Security Registrar shall deliver such
Securities to the Persons in whose names such Securities are so registered.
ARTICLE THREE
The Securities
Section 301. General Title; General Limitations; Issuable in
Series; Terms of Particular Series. The aggregate principal amount of Securities
which may be authenticated and delivered and Outstanding under this Indenture is
not limited.
The Securities may be issued in one or more series up to an
aggregate principal amount of Securities as from time to time may be authorized
by the Board of Directors. All Securities of each series under this Indenture
shall in all respects be equally and ratably entitled to the benefits hereof
with respect to such series without preference, priority or distinction on
account of the actual time of the authentication and delivery or Stated Maturity
of the Securities of such series.
Each series of Securities shall be created either by or
pursuant to a Board Resolution or by or pursuant to an indenture supplemental
hereto. The Securities of each such series may bear such date or dates, be
payable at such place or places, have such Stated Maturity or Maturities, be
issuable at such premium over or discount from their face value, bear interest
at such rate or rates (which may be fixed or floating), from such date or dates,
payable in such installments and on such dates and at such place or places to
the Holders of Securities registered as such on such Regular Record Dates, or
may bear no interest, and may be redeemable or repayable at such Redemption
Price or Prices or Repayment Price or Prices, as the case may be, whether at the
option of the Holder or otherwise, and upon such terms, all as shall be provided
for in or pursuant to the Board Resolution or in or pursuant to the supplemental
indenture creating that series. There may also be established in or pursuant to
a Board Resolution or in or pursuant to a supplemental indenture prior to the
issuance of Securities of each such series, provision for:
(1) the exchange or conversion of the Securities of that
series, at the option of the Holders thereof, for or into new
Securities of a different series or other securities or other property
of the Company or another Person, including shares of capital stock of
the Company or any subsidiary of the Company or of any other Person or
securities directly or indirectly convertible into or exchangeable for
any such shares;
(2) a sinking or purchase fund or other analogous
obligation;
(3) if other than U.S. dollars, the currency or currencies or
units based on or related to currencies (including European Currency
Units) in which the Securities of such series shall be denominated and
in which payments of principal of, and any premium and interest on,
such Securities shall or may be payable;
(4) if the principal of (and premium, if any) or interest, if
any, on the Securities of such series are to be payable, at the
election of the Company or a holder thereof, in a currency or
currencies or units based on or related to currencies (including
European Currency Units) other than that in which the Securities are
stated to be payable, the period or periods within which, and the terms
and conditions upon which, such election may be made;
<PAGE>
(5) if the amount of payments of principal of (and premium, if
any) or interest, if any, on the Securities of such series may be
determined with reference to an index based on (i) a currency or
currencies or units based on or related to currencies (including
European Currency Units) other than that in which the Securities are
stated to be payable, (ii) changes in the price of one or more other
securities or groups or indexes of securities or (iii) changes in the
prices of one or more commodities or groups or indexes of commodities,
or any combination of the foregoing, the manner in which such amounts
shall be determined;
(6) if the aggregate principal amount of the Securities of
that series is to be limited, such limitations, and the maturity date
of the principal amount of the Securities of that series (which may be
fixed or extendible), and the rate or rates (which may be fixed or
floating) per annum at which the Securities of that series will bear
interest, if any, or the method of determining such rate or rates, and
the payment dates and record dates relating to such interest payments;
(7) the exchange of Securities of that series, at the option
of the Holders thereof, for other Securities of the same series of the
same aggregate principal amount of a different authorized kind or
different authorized denomination or denominations, or both;
(8) the appointment by the Trustee of an Authenticating Agent
in one or more places other than the location of the office of the
Trustee with power to act on behalf of the Trustee and subject to its
direction in the authentication and delivery of the Securities of any
one or more series in connection with such transactions as shall be
specified in the provisions of this Indenture or in or pursuant to the
Board Resolution or the supplemental indenture creating such series;
(9) the percentage of their principal amount at which such
Securities will be issued, and the portion of the principal amount of
Securities of the series, if other than the total principal amount
thereof, which shall be payable upon declaration of acceleration of the
Maturity thereof pursuant to Section 502 or provable in bankruptcy
pursuant to Section 504;
(10) any Event of Default with respect to the Securities of
such series, if not set forth herein and any additions, deletions or
other changes to the Events of Default set forth herein that shall be
applicable to the Securities of such series (including a provision
making any Event of Default set forth herein inapplicable to the
Securities of that series);
(11) any covenant solely for the benefit of the Securities of
such series and any additions, deletions or other changes to the
provisions of Article Ten or any definitions relating to such Article
that shall be applicable to the Securities of such series (including a
provision making any Section of such Article inapplicable to the
Securities of such series);
(12) the applicability of Section 402(b) of this
Indenture to the Securities of such series;
<PAGE>
(13) if the Securities of the series shall be issued in whole
or in part in the form of a Global Security or Global Securities, the
terms and conditions, if any, upon which such Global Security or Global
Securities may be exchanged in whole or in part for other individual
Securities; and the Depositary for such Global Security or Global
Securities (if other than the Depositary specified in Section 101
hereof);
(14) the subordination of the Securities of such series to any
other indebtedness of the Company, including without limitation, the
Securities of any other series; and
(15) any other terms of the series, which shall not be
inconsistent with the provisions of this Indenture, all upon such terms
as may be determined in or pursuant to a Board Resolution or in or
pursuant to a supplemental indenture with respect to such series. All
Securities of the same series shall be substantially identical in tenor
and effect, except as to denomination.
The form of the Securities of each series shall be established
pursuant to the provisions of this Indenture in or pursuant to the Board
Resolution or in or pursuant to the supplemental indenture creating such series.
The Securities of each series shall be distinguished from the Securities of each
other series in such manner, reasonably satisfactory to the Trustee, as the
Board of Directors may determine.
Unless otherwise provided with respect to Securities of a
particular series, the Securities of any series may only be issuable in
registered form, without coupons.
Any terms or provisions in respect of the Securities of any
series issued under this Indenture may be determined pursuant to this Section by
providing in a Board Resolution or supplemental indenture for the method by
which such terms or provisions shall be determined.
Section 302. Denominations. The Securities of each series
shall be issuable in such denominations and currency as shall be provided in the
provisions of this Indenture or in or pursuant to the Board Resolution or the
supplemental indenture creating such series. In the absence of any such
provisions with respect to the Securities of any series, the Securities of that
series shall be issuable only in fully registered form in denominations of
$1,000 and any integral multiple thereof.
Section 303. Execution, Authentication and Delivery and
Dating. The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its President, one of its Vice Presidents or its
Treasurer under its corporate seal reproduced thereon and attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities executed by the
Company to the Trustee for authentication; and the Trustee shall, upon Company
Order, authenticate and make available for delivery such Securities as in this
Indenture provided and not otherwise.
<PAGE>
Prior to any such authentication and delivery, the Trustee
shall be entitled to receive, in addition to any Officers' Certificate and
Opinion of Counsel required to be furnished to the Trustee pursuant to Section
102, and the Board Resolution and any certificate relating to the issuance of
the series of Securities required to be furnished pursuant to Section 202, an
Opinion of Counsel stating that:
(1) all instruments furnished to the Trustee conform to the
requirements of the Indenture and constitute sufficient authority
hereunder for the Trustee to authenticate and deliver such Securities;
(2) the form and terms (or in connection with the issuance of
medium-term Securities under Section 311, the manner of determining the
terms) of such Securities have been established in conformity with the
provisions of this Indenture;
(3) all laws and requirements with respect to the execution
and delivery by the Company of such Securities have been complied with,
the Company has the corporate power to issue such Securities and such
Securities have been duly authorized and delivered by the Company and,
assuming due authentication and delivery by the Trustee, constitute
legal, valid and binding obligations of the Company enforceable in
accordance with their terms (subject, as to enforcement of remedies, to
applicable bankruptcy, reorganization, insolvency, fraudulent
conveyance, moratorium or other laws and legal principles affecting
creditors' rights generally from time to time in effect and to general
equitable principles, whether applied in an action at law or in equity)
and entitled to the benefits of this Indenture, equally and ratably
with all other Securities, if any, of such series Outstanding; and
(4) such other matters as the Trustee may reasonably request;
and, if the authentication and delivery relates to a new series of Securities
created by an indenture supplemental hereto, also stating that all laws and
requirements with respect to the form and execution by the Company of the
supplemental indenture with respect to that series of Securities have been
complied with, the Company has corporate power to execute and deliver any such
supplemental indenture and has taken all necessary corporate action for those
purposes and any such supplemental indenture has been executed and delivered and
constitutes the legal, valid and binding obligation of the Company enforceable
in accordance with its terms (subject, as to enforcement of remedies, to
applicable bankruptcy, reorganization, insolvency, fraudulent conveyance,
moratorium or other laws and legal principles affecting creditors' rights
generally from time to time in effect and to general equitable principles,
whether applied in an action at law or in equity).
The Trustee shall not be required to authenticate such
Securities if the issue thereof will adversely affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture.
Unless otherwise provided in the form of Security for any
series, all Securities shall be dated the date of their authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein executed by the Trustee by manual signature of an authorized signatory,
and such certificate upon any Security shall be conclusive evidence, and the
only evidence, that such Security has been duly authenticated and delivered
hereunder.
<PAGE>
Section 304. Temporary Securities. Pending the preparation of
definitive Securities of any series, the Company may execute, and, upon receipt
of the documents required by Section 303, together with a Company Order, the
Trustee shall authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities may
determine, as evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company
will cause definitive Securities of such series to be prepared without
unreasonable delay. After the preparation of definitive Securities, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of the Company in a Place of Payment, without
charge to the Holder; and upon surrender for cancellation of any one or more
temporary Securities the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of such series of authorized denominations and of like
tenor and terms. Until so exchanged the temporary Securities of such series
shall in all respects be entitled to the same benefits under this Indenture as
definitive Securities of such series.
Section 305. Registration, Transfer and Exchange. The Company
shall keep or cause to be kept a register (herein sometimes referred to as the
"Security Register") in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Securities, or of
Securities of a particular series, and for transfers of Securities or of
Securities of such series. Any such register shall be in written form or in any
other form capable of being converted into written form within a reasonable
time. At all reasonable times the information contained in such register or
registers shall be available for inspection by the Trustee at the office or
agency to be maintained by the Company as provided in Section 1002.
Subject to Section 204, upon surrender for transfer of any
Security of any series at the office or agency of the Company in a Place of
Payment, the Company shall execute, and the Trustee shall authenticate and make
available for delivery, in the name of the designated transferee or transferees,
one or more new Securities of such series of any authorized denominations, of a
like aggregate principal amount and Stated Maturity and of like tenor and terms.
Subject to Section 204, at the option of the Holder,
Securities of any series may be exchanged for other Securities of such series of
any authorized denominations, of a like aggregate principal amount and Stated
Maturity and of like tenor and terms, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
make available for delivery, the Securities which the Securityholder making the
exchange is entitled to receive.
All Securities issued upon any transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such transfer or exchange.
Every Security presented or surrendered for transfer or
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Security Registrar duly executed, by the Holder thereof or
his attorney duly authorized in writing.
<PAGE>
Unless otherwise provided in the Security to be transferred or
exchanged, no service charge shall be made on any Securityholder for any
transfer or exchange of Securities, but the Company may (unless otherwise
provided in such Security) require payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection with any transfer
or exchange of Securities, other than exchanges pursuant to Section 304 or 906
not involving any transfer.
The Company shall not be required (i) to issue, transfer or
exchange any Security of any series during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of
Securities of such series selected for redemption under Section 1103 and ending
at the close of business on the date of such mailing, or (ii) to transfer or
exchange any Security so selected for redemption in whole or in part, except for
the portion of such Security not so selected for redemption.
None of the Company, the Trustee, any agent of the Trustee,
any Paying Agent or the Security Registrar will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests of a Global Security or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
The Company initially appoints the Trustee to act as Security
Registrar for the Securities on its behalf. The Company may at any time and from
time to time authorize any Person to act as Security Registrar in place of the
Trustee with respect to any series of Securities issued under this Indenture.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If (i) any mutilated Security is surrendered to the Trustee, or the Company and
the Trustee receive evidence to their satisfaction of the destruction, loss or
theft of any Security, and (ii) there is delivered to the Company and the
Trustee such security or indemnity as may be required by them to save each of
them harmless, then, in the absence of notice to the Company or the Trustee that
such Security has been acquired by a bona fide purchaser, the Company shall
execute and upon its request the Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Security, a new Security of like tenor, series, Stated Maturity and principal
amount, bearing a number not contemporaneously Outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of the same series duly issued hereunder.
<PAGE>
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
Section 307. Payment of Interest; Interest Rights Preserved.
Unless otherwise provided with respect to such Security pursuant to Section 301,
interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest.
Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the
registered Holder on the relevant Regular Record Date by virtue of his having
been such Holder; and, except as hereinafter provided, such Defaulted Interest
may be paid by the Company, at its election in each case, as provided in Clause
(1) or Clause (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names any such Securities (or their
respective Predecessor 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 in writing of the amount of Defaulted Interest
proposed to be paid on each such Security and the date of the proposed
payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest which shall be not more than
15 nor less than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify the Company 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 the Holder of each such Security 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 such Securities (or their respective Predecessor
Securities) are 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 such 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 of the proposed payment pursuant to this
Clause, such manner of payment shall be deemed practicable by the
Trustee.
If any installment of interest the Stated Maturity of which is
on or prior to the Redemption Date for any Security called for redemption
pursuant to Article Eleven is not paid or duly provided for on or prior to the
Redemption Date in accordance with the foregoing provisions of this Section,
such interest shall be payable as part of the Redemption Price of such
Securities.
<PAGE>
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon 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 308. Persons Deemed Owners. The Company, the Trustee
and any agent of the Company or the Trustee may treat the Person in whose name
any Security is registered in the Security Register as the owner of such
Security for the purpose of receiving payment of principal of (and premium, if
any), and (subject to Section 307) interest on, such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Section 309. Cancellation. All Securities surrendered for
payment, redemption, transfer, conversion or exchange or credit against a
sinking fund shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee and, if not already canceled, shall be promptly
canceled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all Securities
so delivered shall be promptly canceled by the Trustee. No Security shall be
authenticated in lieu of or in exchange for any Securities canceled as provided
in this Section, except as expressly permitted by this Indenture. The Trustee
shall return all canceled Securities to the Company.
Section 310. Computation of Interest. Unless otherwise
provided as contemplated in Section 301, interest on the Securities shall be
calculated on the basis of a 360-day year of twelve 30-day months.
Section 311. Medium-term Securities. Notwithstanding any
contrary provision herein, if all Securities of a series are not to be
originally issued at one time, it shall not be necessary for the Company to
deliver to the Trustee an Officers' Certificate, Board Resolution, supplemental
indenture, Opinion of Counsel or Company Request otherwise required pursuant to
Sections 202, 301 and 303 at or prior to the time of authentication of each
Security of such series if such documents are delivered to the Trustee or its
agent at or prior to the authentication upon original issuance of the first
Security of such series to be issued; provided that any subsequent request by
the Company to the Trustee to authenticate Securities of such series upon
original issuance shall constitute a representation and warranty by the Company
that as of the date of such request, the statements made in the Officers'
Certificate delivered pursuant to Section 102 shall be true and correct as if
made on such date.
An Officers' Certificate, supplemental indenture or Board
Resolution delivered by the Company to the Trustee in the circumstances set
forth in the preceding paragraph may provide that Securities which are the
subject thereof will be authenticated and delivered by the Trustee or its agent
on original issue from time to time upon the telephonic or written order of
persons designated in such Officers' Certificate, Board Resolution or
supplemental indenture (any such telephonic instructions to be confirmed
promptly in writing by such persons) and that such persons are authorized to
determine, consistent with such Officers' Certificate, supplemental indenture or
Board Resolution, such terms and conditions of said Securities as are specified
in such Officers' Certificate, supplemental indenture or Board Resolution.
<PAGE>
Section 312. 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.
Section 313. Global Securities. (a) Each Global Security
authenticated under this Indenture shall be registered in the name of the
Depositary designated by the Company for such Global Security or a nominee
thereof and delivered to such Depositary or a nominee thereof or custodian
therefor, and each such Global Security shall constitute a single Security for
all purposes of this Indenture.
(b) Notwithstanding any other provision of this Indenture, no
Global Security may be exchanged in whole or in part for Securities registered,
and no transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depositary for such Global Security or a
nominee thereof unless (i) such Depositary (A) has notified the Company that it
is unwilling or unable to continue as Depositary for such Global Security or (B)
has ceased to be a clearing agency registered as such under the Exchange Act or
announces an intention permanently to cease business or does in fact do so or
(ii) there shall have occurred and be continuing an Event of Default with
respect to such Global Security.
(c) If any Global Security is to be exchanged for other
Securities or canceled in whole, it shall be surrendered by or on behalf of the
Depositary or its nominee to the Trustee, as Security Registrar, for exchange or
cancellation, as provided in this Article Three. If any Global Security is to be
exchanged for other Securities or canceled in part, or if another Security is to
be exchanged in whole or in part for a beneficial interest in any Global
Security, in each case, as provided in Section 305, then either (i) such Global
Security shall be so surrendered for exchange or cancellation, as provided in
this Article Three or (ii) the principal amount thereof shall be reduced or
increased by an amount equal to the portion thereof to be so exchanged or
canceled, or equal to the principal amount of such other Security to be so
exchanged for a beneficial interest therein, as the case may be, by means of an
appropriate adjustment made on the records of the Trustee, as Security
Registrar, whereupon the Trustee, in accordance with the Applicable Procedures,
shall instruct the Depositary or its authorized representative to make a
corresponding adjustment to its records. Upon any such surrender or adjustment
of a Global Security, the Trustee shall, subject to Section 305 and as otherwise
provided in this Article Three, authenticate and deliver any Securities issuable
in exchange for such Global Security (or any portion thereof) to or upon the
order of, and registered in such names as may be directed by, the Depositary or
its authorized representative. Upon the request of the Trustee in connection
with the occurrence of any of the events specified in the preceding paragraph,
the Company shall promptly make available to the Trustee a reasonable supply of
Securities that are not in the form of Global Securities. The Trustee shall be
entitled to rely upon any order, direction or request of the Depositary or its
authorized representative which is given or made pursuant to this Article Three
if such order, direction or request is given or made in accordance with the
Applicable Procedures.
(d) Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global Security
or any portion thereof, whether pursuant to this Article Three or otherwise,
shall be authenticated and delivered in the form of, and shall be, a registered
Global Security, unless such Security is registered in the name of a Person
other than the Depositary for such Global Security or a nominee thereof, in
which case such Registered Security shall be authenticated and delivered in
definitive, fully registered form, without interest coupons.
<PAGE>
(e) The Depositary or its nominee, as registered owner of a
Global Security, shall be the Holder of such Global Security for all purposes
under the Indenture and the Registered Securities, and owners of beneficial
interests in a Global Security shall hold such interests pursuant to the
Applicable Procedures. Accordingly, any such owner's beneficial interest in a
Global Security will be shown only on, and the transfer of such interest shall
be effected only through, records maintained by the Depositary or its nominee or
its Agent Members and such owners of beneficial interests in a Global Security
will not be considered the owners or holders thereof.
ARTICLE FOUR
Satisfaction and Discharge of Indenture; Defeasance; Unclaimed Moneys
Section 401. Applicability of Article. If, pursuant to Section
301, provision is made for the defeasance of Securities of a series and if the
Securities of such series are denominated and payable only in Dollars (except as
provided pursuant to Section 301), then the provisions of this Article Four
relating to defeasance of Securities shall be applicable except as otherwise
specified pursuant to Section 301 for Securities of such series. Defeasance
provisions, if any, for Securities denominated in a Foreign Currency may be
specified pursuant to Section 301.
Section 402. Satisfaction and Discharge of Indenture;
Defeasance. (a) If at any time (i) the Company shall have delivered to the
Trustee for cancellation all Securities of any series theretofore authenticated
and delivered (other than (1) any Securities of such series which shall have
been destroyed, lost or stolen and which shall have been replaced or paid as
provided in Section 306 and (2) Securities for whose payment money has
theretofore been deposited in trust and thereafter repaid to the Company as
provided in Section 405) or (ii) all Securities of such series not theretofore
delivered to the Trustee for cancellation shall have become due and payable, or
are by their terms to become due and payable within one year or are to be called
for redemption within one year under arrangements satisfactory to the Trustee
for the giving of notice of redemption, and the Company shall deposit with the
Trustee as trust funds the entire amount in the Currency in which such
Securities are denominated (except as otherwise provided pursuant to Section
301) sufficient (in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to the
Trustee) without consideration of any reinvestment and after payment of all
taxes or other charges and assessments in respect thereof payable by the
Trustee, to pay at maturity or upon redemption all Securities of such series not
theretofore delivered to the Trustee for cancellation, including principal and
premium, if any, and interest due or to become due on such date of maturity or
redemption date, as the case may be, no default with respect to the Securities
has occurred and is continuing on the date of such deposit, such deposit does
not result in a breach or violation of, or constitute a default under, the
Indenture or any other agreement or instrument to which the Company is a party
and the Company delivers an Officers' Certificate and an Opinion of Counsel each
stating that such conditions have been complied with and if in either case the
Company shall also pay or cause to be paid all other sums payable hereunder by
the Company, then this Indenture shall cease to be of further effect (except as
to any surviving rights of registration of transfer or exchange of such
Securities herein expressly provided for and rights to receive payments of
principal of, and premium, if any, and interest on, such Securities) with
respect to the Securities of such series, and the Trustee, on demand of the
Company, shall execute proper instruments acknowledging satisfaction of and
discharging this Indenture.
<PAGE>
(b) Subject to Sections 402(c), 403 and 407, the Company at
any time may terminate, with respect to Securities of a particular series, (i)
all its obligations under the Securities of such series and this Indenture with
respect to the Securities of such series ("legal defeasance option") or (ii) its
obligations with respect to the Securities of such series under Section 1006 or
1007 and clause (3) of Section 801 ("covenant defeasance option"). The Company
may exercise its legal defeasance option notwithstanding its prior exercise of
its covenant defeasance option.
If the Company exercises its legal defeasance option, payment
of the Securities of the defeased series may not be accelerated because of an
Event of Default. If the Company exercises its covenant defeasance option,
payment of the Securities may not be accelerated because of an Event of Default
specified in Section 501(4) to the extent it relates to Section 1006 or 1007.
Upon satisfaction of the conditions set forth herein and upon
request of the Company, the Trustee shall acknowledge in writing the discharge
of those obligations that the Company terminates.
(c) Notwithstanding clause (a) above and the exercise of the
legal defeasance option in clause (b) above, the Company's obligations in
Sections 305, 306, 405, 406, 407, 607, 608, 701 and 1002 shall survive until the
Securities of the defeased series have been paid in full. Thereafter, the
Company's obligations in Sections 607, 405 and 406 shall survive.
Section 403. Conditions of Defeasance. The Company may
exercise its legal defeasance option or its covenant defeasance option with
respect to Securities of a particular series only if:
(1) the Company irrevocably deposits in trust with the Trustee
money or U.S. Government Obligations for the payment of principal of,
and premium, if any, and interest on, the Securities of such series to
maturity or redemption, as the case may be;
(2) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent public accountants expressing
their opinion that the payments of principal and interest when due and
without reinvestment on the deposited U.S. Government Obligations plus
any deposited money without investment will provide cash at such times
and in such amounts as will be sufficient to pay the principal,
premium, if any, and interest when due on all the Securities of such
series to maturity or redemption, as the case may be;
(3) 91 days pass after the deposit is made and during the
91-day period no Default specified in Section 501(5) or (6) with
respect to the Company occurs which is continuing at the end of the
period;
(4) no Default has occurred and is continuing on the date of
such deposit and after giving effect thereto;
(5) the deposit does not constitute a default under any other
agreement binding on the Company;
(6) the Company delivers to the Trustee an Opinion of Counsel
to the effect that the trust resulting from the deposit does not
constitute, or is qualified as, a regulated investment company under
the Investment Company Act of 1940;
<PAGE>
(7) in the event of the legal defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that
(i) the Company has received from 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 of Counsel shall confirm
that, the Holders of Securities of such series will not recognize
income, gain or loss for Federal income tax purposes as a result of
such defeasance and will be subject to Federal income tax on the same
amounts, in the same manner and at the same times as would have been
the case if such defeasance had not occurred;
(8) in the event of the covenant defeasance option, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of Securities of such series will not
recognize income, gain or loss for Federal income tax purposes as a
result of such covenant defeasance and will be subject to Federal
income tax on the same amounts, in the same manner and at the same
times as would have been the case if such covenant defeasance had not
occurred; and
(9) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent to the defeasance and discharge of the Securities of such
series as contemplated by this Article Four have been complied with.
Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of Securities of such series at a
future date in accordance with Article Four.
Section 404. Application of Trust Money. The Trustee shall
hold in trust money or U.S. Government Obligations deposited with it pursuant to
this Article Four. It shall apply the deposited money and the money from U.S.
Government Obligations through any paying agent and in accordance with this
Indenture to the payment of principal of, and premium, if any, and interest on,
the Securities of the defeased series.
Section 405. Repayment to Company. The Trustee and any paying
agent shall promptly turn over to the Company upon request any excess money or
securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee
and any paying agent shall pay to the Company upon request any money held by
them for the payment of principal, premium or interest that remains unclaimed
for two years, and, thereafter, Holders entitled to such money must look to the
Company for payment as general creditors and all liability of the Trustee or
such paying agent with respect to such money shall thereupon cease.
Section 406. Indemnity for U.S. Government Obligations. The Company shall
pay and shall indemnify the Trustee and the Holders against any tax, fee or
other charge imposed on or assessed against deposited U.S. Government
Obligations or the principal and interest received on such U.S. Government
Obligations.
<PAGE>
Section 407. Reinstatement. If the Trustee or any paying agent
is unable to apply any money or U.S. Government Obligations in accordance with
this Article Four by reason of any legal proceeding or by reason of any order or
judgment of any court or government authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Securities of the defeased series shall be revived and
reinstated as though no deposit had occurred pursuant to this Article Four until
such time as the Trustee or any paying agent is permitted to apply all such
money or U.S. Government Obligations in accordance with this Article Four.
ARTICLE FIVE
Remedies
Section 501. Events of Default. "Event of Default", wherever
used herein, means with respect to any series of Securities any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected 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), unless such event is either
inapplicable to a particular series or it is specifically deleted or modified in
the supplemental indenture creating such series of Securities or in the form of
Security for such series:
(1) default in the payment of any interest upon any Security
of that series when it becomes due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of (or premium, if
any, on) any Security of that series at its Maturity; or
(3) default in the payment of any sinking or purchase fund or
analogous obligation when the same becomes due by the terms of the
Securities of such series; or
(4) default in the performance of any covenant or warranty of
the Company in this Indenture in respect of the Securities of such
series (other than a covenant or warranty in respect of the Securities
of such series a default in the performance of which or the breach of
which is elsewhere in this Section specifically dealt with), all of
such covenants and warranties in the Indenture which are not expressly
stated to be for the benefit of a particular series of Securities being
deemed in respect of the Securities of all series for this purpose, and
continuance of such default or breach for a period of 90 days after
there has been given, by registered or certified mail, to the Company
by the Trustee or to the Company and the Trustee by the Holders of at
least 25% in principal amount of the Outstanding Securities of such
series, a written notice specifying such default or breach and
requiring it to be remedied and stating that such notice is a "Notice
of Default" hereunder; or
(5) the entry of an order for relief against the Company under
the Federal Bankruptcy Code by a court having jurisdiction in the
premises or a decree or order by a court having jurisdiction in the
premises adjudging the Company a bankrupt or insolvent under any other
applicable Federal or State law, or the entry of a decree or order
approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company
under the Federal Bankruptcy Code or any other applicable Federal or
State law, or appointing a receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of the Company or of any
substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or
order unstayed and in effect for a period of 60 consecutive days; or
<PAGE>
(6) the consent by the Company to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it of
a petition or answer or consent seeking reorganization or relief under
the Federal Bankruptcy Code or any other applicable Federal or State
law, or the consent by it to the filing of any such petition or to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator
(or other similar official) of the Company or of any substantial part
of its property, or the making by it of an assignment for the benefit
of creditors, or the admission by it in writing of its inability to pay
its debts generally as they become due, or the taking of corporate
action by the Company in furtherance of any such action; or
(7) any other Event of Default provided in the supplemental
indenture under which such series of Securities is issued or in the
form of Security for such series.
Section 502. Acceleration of Maturity; Rescission and
Annulment. If an Event of Default described in paragraph (1), (2), (3), (4) or
(7) (if the Event of Default under paragraph (4) or (7) is with respect to less
than all series of Securities then Outstanding) of Section 501 occurs and is
continuing with respect to any series, then and in each and every such case,
unless the principal of all the Securities of such series shall have already
become due and payable, either the Trustee or the Holders of not less than 25%
in aggregate principal amount of the Securities of such series then Outstanding
hereunder (each such series acting as a separate class), by notice in writing to
the Company (and to the Trustee if given by Holders), may declare the principal
amount (or, if the Securities of such series are Original Issue Discount
Securities, such portion of the principal amount as may be specified in the
terms of that series) of all the Securities of such series then Outstanding and
all accrued interest thereon to be due and payable immediately, and upon any
such declaration the same shall become and shall be immediately due and payable,
anything in this Indenture or in the Securities of such series contained to the
contrary notwithstanding. If an Event of Default described in paragraph (4) or
(7) (if the Event of Default under paragraph (4) or (7) is with respect to all
series of Securities then Outstanding), or (5) or (6) of Section 501 occurs and
is continuing, then and in each and every such case, unless the principal of all
the Securities shall have already become due and payable, either the Trustee or
the Holders of not less than 25% in aggregate principal amount of all the
Securities then Outstanding hereunder (treated as one class), by notice in
writing to the Company (and to the Trustee if given by Holders), may declare the
principal amount (or, if any Securities are Original Issue Discount Securities,
such portion of the principal amount as may be specified in the terms thereof)
of all the Securities then Outstanding and all accrued interest thereon, if any,
to be due and payable immediately, and upon any such declaration the same shall
become and shall be immediately due and payable, anything in this Indenture or
in the Securities contained to the contrary notwithstanding.
At any time after such a declaration of acceleration has been
made with respect to the Securities of any series and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter in this Article provided, the Holders of a majority in principal
amount of the Outstanding Securities of such series, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue installments of interest on the
Securities of such series,
(B) the principal of (and premium, if any, on) any
Securities of such series which have become due otherwise than
by such declaration of acceleration, and interest thereon at
the rate or rates prescribed therefor by the terms of the
Securities of such series, to the extent that payment of such
interest is lawful,
<PAGE>
(C) interest upon overdue installments of interest at
the rate or rates prescribed therefor by the terms of the
Securities of such series to the extent that payment of such
interest is lawful, and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel and all other amounts due the Trustee under Section
607;
and
(2) all Events of Default with respect to such series of
Securities, other than the nonpayment of the principal of the
Securities of such series which have become due solely by such
acceleration, have been cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee. The Company covenants that if
(1) default is made in the payment of any installment of
interest on any Security of any series when such interest becomes due
and payable, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof, or
(3) default is made in the payment of any sinking or purchase
fund or analogous obligation when the same becomes due by the terms of
the Securities of any series,
and any such default continues for any period of grace provided with respect to
the Securities of such series, the Company will, upon demand of the Trustee, pay
to it, for the benefit of the Holder of any such Security (or the Holders of any
such series in the case of Clause (3) above), the whole amount then due and
payable on any such Security (or on the Securities of any such series in the
case of Clause (3) above) for principal (and premium, if any) and interest, with
interest, to the extent that payment of such interest shall be legally
enforceable, upon the overdue principal (and premium, if any) and upon overdue
installments of interest, at such rate or rates as may be prescribed therefor by
the terms of any such Security (or of Securities of any such series in the case
of Clause (3) above); and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel and all other amounts due the Trustee under Section 607.
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, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, and may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Company or any other obligor upon the Securities of
such series and collect the money adjudged or decreed to be payable in the
manner provided by law out of the property of the Company or any other obligor
upon such Securities, wherever situated.
<PAGE>
If an Event of Default with respect to any series of
Securities occurs and is continuing, the Trustee may in its discretion proceed
to protect and enforce its rights and the rights of the Holders of Securities of
such series by such appropriate judicial proceedings as the Trustee shall deem
most effectual 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 504. 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 or interest) shall be entitled and
empowered, by intervention in such proceedings or otherwise,
(i) 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 and advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel and
all other amounts due the Trustee under Section 607) and of the
Securityholders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, liquidator, sequestrator (or other similar
official) in any such judicial proceeding is hereby authorized by each
Securityholder to make such payment to the Trustee and in the event that the
Trustee shall consent to the making of such payments directly to the
Securityholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 607.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Securityholder any plan or 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 Securityholder in
any such proceeding.
Section 505. Trustee May Enforce Claims Without Possession of
Securities. All rights of action and claims under this Indenture or the
Securities of any series may be prosecuted and enforced by the Trustee without
the possession of any of the Securities of such series 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, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agent and
counsel, be for the ratable benefit of the Holders of the Securities of the
series in respect of which such judgment has been recovered.
<PAGE>
Section 506. Application of Money Collected. Any money
collected by the Trustee with respect to a series of Securities pursuant to this
Article 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 (or premium, if any) or interest, upon presentation of the Securities
of such series and the notation thereon of the payment if only partially paid
and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 607.
SECOND: To the payment of the amounts then due and unpaid upon
the Securities of that series for principal (and premium, if any) and interest,
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 (and premium, if any) and
interest, respectively.
THIRD: To the Company.
Section 507. Limitation on Suits. No Holder of any Security of any
series shall have any right 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
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to Securities of
such series;
(2) the Holders of not less than 25% in aggregate principal
amount of the Outstanding Securities of such series 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;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) 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 of
such series;
it being understood and intended that no one or more Holders of Securities of
such series shall have any right in any manner whatever by virtue of, or by
availing of, any provision of this Indenture to affect, disturb or prejudice the
rights of any other Holders of Securities of such series, or to obtain or to
seek to obtain priority or preference over any other such Holders or to enforce
any right under this Indenture, except in the manner herein provided and for the
equal and proportionate benefit of all the Holders of all Securities of such
series.
Section 508. Unconditional Right of Securityholders to Receive
Principal, Premium and Interest. Notwithstanding any other provisions in 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 (subject to Section 307) interest on such Security on the respective Stated
Maturities expressed in such Security (or, in the case of redemption or
repayment, on the Redemption Date or Repayment Date, as the case may be) and to
institute suit for the enforcement of any such payment, and such right shall not
be impaired without the consent of such Holder.
<PAGE>
Section 509. Restoration of Rights and Remedies. If the
Trustee or any Securityholder has instituted any proceeding to enforce any right
or remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, then and in every such case the Company, the Trustee
and the Securityholders shall, subject to any determination in such proceeding,
be restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Trustee and the Securityholders shall
continue as though no such proceeding had been instituted.
Section 510. Rights and Remedies Cumulative. No right or
remedy herein conferred upon or reserved to the Trustee or to the
Securityholders 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 511. Delay or Omission Not Waiver. No delay or
omission of the Trustee or of any Holder of any Security to exercise any right
or remedy accruing upon any Event of Default shall impair any such right or
remedy or constitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Trustee
or to the Securityholders may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee or by the Securityholders, as the case
may be.
Section 512. Control by Securityholders. The Holders of a
majority in aggregate principal amount of the Outstanding Securities of any
series 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 on the Trustee with respect to the Securities of such series,
provided that
(1) the Trustee shall have the right to decline to follow any
such direction if the Trustee, being advised by counsel, determines
that the action so directed may not lawfully be taken or would conflict
with this Indenture or if the Trustee in good faith shall, by a
Responsible Officer, determine that the proceedings so directed would
involve it in personal liability or be unjustly prejudicial to the
Holders not taking part in such direction, and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
Section 513. Waiver of Past Defaults. The Holders of not less
than a majority in aggregate principal amount of the Outstanding Securities of
any series may on behalf of the Holders of all the Securities of such series
waive any past default hereunder with respect to such series and its
consequences, except a default not theretofore cured
(1) in the payment of the principal of (or premium, if any) or
interest on any Security of such series, or in the payment of any
sinking or purchase fund or analogous obligation with respect to the
Securities of such series, or
(2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of the
Holder of each Outstanding Security of such series.
<PAGE>
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
Section 514. 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 any court may in its discretion require, in any
suit for the enforcement of any right or remedy under this Indenture, or in any
suit against the Trustee for any action taken or omitted by it as Trustee, 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, 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 shall not apply to any
suit instituted by the Trustee, to any suit instituted by any Securityholder, or
group of Securityholders, holding in the aggregate more than 10% in principal
amount of the Outstanding Securities of any series to which the suit relates, or
to any suit instituted by any Securityholder for the enforcement of the payment
of the principal of (or premium, if any) or interest on any Security on or after
the respective Stated Maturities expressed in such Security (or, in the case of
redemption or repayment, on or after the Redemption Date or Repayment Date).
Section 515. Waiver of Stay or Extension Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and the Company (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any power herein
granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities. (a) Except during
the continuance of an Event of Default with respect to any series of
Securities,
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture with
respect to the Securities of such series, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may,
with respect to Securities of such series, 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; but 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
be under a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture.
<PAGE>
(b) In case an Event of Default with respect to any series of
Securities has occurred and is continuing, the Trustee shall exercise with
respect to the Securities of such series 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 such person's own affairs.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that
(1) this Subsection shall not be construed to limit the
effect of Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in principal amount of the
Outstanding Securities of any series relating to 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,
under this Indenture with respect to the Securities of such series; and
(4) 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 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.
(d) Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Trustee shall be subject to the provisions of
this Section.
Section 602. Notice of Defaults. Within 90 days after the
occurrence of any default hereunder with respect to Securities of any series,
the Trustee shall transmit by mail to all Securityholders of such series, as
their names and addresses appear in the Security Register, notice of such
default hereunder known to the Trustee, unless such default shall have been
cured or waived; provided, however, that, except in the case of a default in the
payment of the principal of (or premium, if any) or interest on any Security of
such series or in the payment of any sinking or purchase fund installment or
analogous obligation with respect to Securities of such series, the Trustee
shall be protected in withholding such notice if and so long as the board of
directors, the executive committee or a trust committee of directors and/or
Responsible Officers of the Trustee in good faith determine that the withholding
of such notice is in the interests of the Securityholders of such series; and
provided, further, that in the case of any default of the character specified in
Section 501(4) with respect to Securities of such series no such notice to
Securityholders of such series shall be given until at least 90 days after the
occurrence thereof. For the purpose of this Section, the term "default", with
respect to Securities of any series, means any event which is, or after notice
or lapse of time or both would become, an Event of Default with respect to
Securities of such series.
<PAGE>
Section 603. Certain Rights of Trustee. Except as otherwise
provided in Section 601:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture or
other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) 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;
(d) the Trustee may consult with counsel of its selection and
the written advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Securityholders pursuant to this Indenture, unless such
Securityholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be incurred by
it in compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, 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, and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys and the Trustee shall not be responsible for any misconduct
or negligence on the part of any agent or attorney appointed with due care by it
hereunder.
Section 604. Not Responsible for Recitals or Issuance of
Securities. The recitals contained herein and in the Securities, except the
certificates of authentication, shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Indenture or
of the Securities. The Trustee shall not be accountable for the use or
application by the Company of Securities or the proceeds thereof.
<PAGE>
Section 605. May Hold Securities. The Trustee, any Paying
Agent, the Security Registrar or any other agent of the Company, in its
individual or any other capacity, may become the owner or pledgee of Securities
and, subject to Sections 608 and 613, may otherwise deal with the Company with
the same rights it would have if it were not Trustee, Paying Agent, Security
Registrar or such other agent.
Section 606. Money Held in Trust. Money held by the Trustee in
trust hereunder need not be segregated from other funds except to the extent
required by law. The Trustee shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed with the Company.
Section 607. Compensation and Reimbursement. The Company agrees
(1) to pay to the Trustee from time to time such compensation
for all services rendered by it hereunder as the parties shall agree
from time to time (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an
express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance
as may be attributable to its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or
bad faith on its part, arising out of or in connection with the
acceptance or administration of this trust, including the 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.
As security for the performance of the obligations of the
Company under this Section the Trustee shall have a lien prior to the Securities
upon all property and funds held or collected by the Trustee as such, except
funds held in trust for the payment of principal of (and premium, if any) or
interest on particular Securities.
Section 608. Disqualification; Conflicting Interests. The
Trustee for the Securities of any series issued hereunder shall be subject to
the provisions of Section 310(b) of the Trust Indenture Act during the period of
time provided for therein. In determining whether the Trustee has a conflicting
interest as defined in Section 310(b) of the Trust Indenture Act with respect to
the Securities of any series, there shall be excluded for purposes of the
conflicting interest provisions of such Section 310(b) the Securities of every
other series issued under this Indenture (i) every series of securities issued
under the Indenture dated as of __________ __, 199_, between Clear Channel
Communications, Inc. and _________________, (ii) every series of securities
issued under the Indenture dated as of _________ __, 199_, between Clear Channel
Communications, Inc. and ____________. Nothing herein shall prevent the Trustee
from filing with the Commission the application referred to in the second to
last paragraph of Section 310(b) of the Trust Indenture Act.
<PAGE>
Section 609. Corporate Trustee Required; Eligibility. There
shall at all times be a Trustee hereunder with respect to each series of
Securities, which shall be a corporation organized and doing business under the
laws of the United States of America or of any State, authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000, and subject to supervision or examination by Federal or State
authority. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Trustee with respect to any series of Securities shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
Section 610. Resignation and Removal; Appointment of
Successor. (a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 611.
(b) The Trustee may resign with respect to any series of
Securities at any time by giving written notice thereof to the Company. If an
instrument of acceptance by a successor Trustee shall not have been delivered to
the Trustee within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(c) The Trustee may be removed with respect to any series of
Securities at any time by Act of the Holders of a majority in principal amount
of the Outstanding Securities of that series, delivered to the Trustee and to
the Company. If an instrument of acceptance by a successor Trustee shall not
have been delivered to the Trustee within 30 days after the giving of such
notice of removal, the removed Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 310(b) of
the Trust Indenture Act pursuant to Section 608(a) with respect to any
series of Securities after written request therefor by the Company or
by any Securityholder who has been a bona fide Holder of a Security of
that series for at least 6 months, or
(2) the Trustee shall cease to be eligible under Section 609
with respect to any series of Securities and shall fail to resign after
written request therefor by the Company or by any such Securityholder,
or
(3) the Trustee shall become incapable of acting with respect
to any series of Securities, or
(4) the Trustee shall be adjudged a bankrupt or insolvent or a
receiver of the Trustee or of its property shall be appointed or any
public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation,
<PAGE>
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, with respect to the series, or in the case of Clause (4), with respect
to all series, or (ii) subject to Section 514, any Securityholder who has been a
bona fide Holder of a Security of such series for at least 6 months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee with respect to the series, or, in the case of Clause (4),
with respect to all series.
(e) If the Trustee shall resign, be removed or become
incapable of acting with respect to any series of Securities, or if a vacancy
shall occur in the office of the Trustee with respect to any series of
Securities for any cause, the Company, by a Board Resolution, shall promptly
appoint a successor Trustee for that series of Securities. If, within one year
after such resignation, removal or incapacity, or the occurrence of such
vacancy, a successor Trustee with respect to such series of Securities shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment, become the successor Trustee with respect to such series
and supersede the successor Trustee appointed by the Company with respect to
such series. If no successor Trustee with respect to such series shall have been
so appointed by the Company or the Securityholders of such series and accepted
appointment in the manner hereinafter provided, any Securityholder who has been
a bona fide Holder of a Security of that series for at least 6 months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect
to such series.
(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to any series and each appointment of a
successor Trustee with respect to any series by mailing written notice of such
event by first-class mail, postage prepaid, to the Holders of Securities of that
series as their names and addresses appear in the Security Register. Each notice
shall include the name of the successor Trustee and the address of its principal
Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor. Every
successor Trustee appointed hereunder shall execute, acknowledge and deliver to
the Company and to the predecessor Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the predecessor Trustee
shall become effective with respect to any series as to which it is resigning or
being removed as Trustee, and such successor Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts and
duties of the predecessor Trustee with respect to any such series; but, on
request of the Company or the successor Trustee, such predecessor Trustee shall,
upon payment of its reasonable charges, if any, execute and deliver an
instrument transferring to such successor Trustee all the rights, powers and
trusts of the predecessor Trustee, and shall duly assign, transfer and deliver
to such successor Trustee all property and money held by such predecessor
Trustee hereunder with respect to all or any such series, subject nevertheless
to its lien, if any, provided for in Section 607. Upon request of any such
successor Trustee, the Company shall execute any and all instruments for more
fully and certainly vesting in and confirming to such successor Trustee all such
rights, powers and trusts.
<PAGE>
In case of the appointment hereunder of a successor Trustee
with respect to the Securities of one or more (but not all) series, the Company,
the predecessor Trustee and each successor Trustee with respect to the
Securities of any applicable series shall execute and deliver an indenture
supplemental hereto which shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the predecessor Trustee with respect to the Securities of any series as to
which the predecessor Trustee is not being succeeded shall continue to be vested
in the predecessor Trustee, and shall add to or change any of the provisions of
this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be Trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee.
No successor Trustee with respect to any series of Securities
shall accept its appointment unless at the time of such acceptance such
successor Trustee shall be qualified and eligible with respect to that series
under this Article.
Section 612. Merger, Conversion, Consolidation or Succession
to Business. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
Section 613. Preferential Collection of Claims Against
Company. (a) Subject to Subsection (b) of this Section, if the Trustee shall be
or shall become a creditor, directly or indirectly, secured or unsecured, of the
Company within 3 months prior to a default, as defined in Subsection (c) of this
Section, or subsequent to such a default, then, unless and until such default
shall be cured, the Trustee shall set apart and hold in a special account for
the benefit of the Trustee individually, the Holders of the Securities and the
holders of other indenture securities (as defined in Subsection (c) of this
Section):
(1) an amount equal to any and all reductions in the amount
due and owing upon any claim as such creditor in respect of principal
or interest, effected after the beginning of such 3-month period and
valid as against the Company and its other creditors, except any such
reduction resulting from the receipt or disposition of any property
described in paragraph (2) of this Subsection, or from the exercise of
any right of set-off which the Trustee could have exercised if a
petition in bankruptcy had been filed by or against the Company upon
the date of such default; and
(2) all property received by the Trustee in respect of any
claim as such creditor, either as security therefor, or in satisfaction
or composition thereof, or otherwise, after the beginning of such
3-month period, or an amount equal to the proceeds of any such
property, if disposed of, subject, however, to the rights, if any, of
the Company and its other creditors in such property or such proceeds.
Nothing herein contained, however, shall affect the right of the Trustee
(A) to retain for its own account (i) payments made
on account of any such claim by any Person (other than the
Company) who is liable thereon, and (ii) the proceeds of the
bona fide sale of any such claim by the Trustee to a third
person, and (iii) distributions made in cash, securities or
other property in respect of claims filed against the Company
in bankruptcy or receivership or in proceedings for
reorganization pursuant to the Federal Bankruptcy Act or
applicable State law;
<PAGE>
(B) to realize, for its own account, upon any
property held by it as security for any such claim, if such
property was so held prior to the beginning of such 3-month
period;
(C) to realize, for its own account, but only to the
extent of the claim hereinafter mentioned, upon any property
held by it as security for any such claim, if such claim was
created after the beginning of such 3-month period and such
property was received as security therefor simultaneously with
the creation thereof, and if the Trustee shall sustain the
burden of proving that at the time such property was so
received the Trustee had no reasonable cause to believe that a
default as defined in Subsection (c) of this Section would
occur within 3 months; or
(D) to receive payment on any claim referred to in
paragraph (B) or (C), against the release of any property held
as security for such claim as provided in paragraph (B) or
(C), as the case may be, to the extent of the fair value of
such property.
For the purposes of paragraphs (B), (C) and (D), property
substituted after the beginning of such 3-month period for property held as
security at the time of such substitution shall, to the extent of the fair value
of the property released, have the same status as the property released, and, to
the extent that any claim referred to in any of such paragraphs is created in
renewal of or in substitution for or for the purpose of repaying or refunding
any pre-existing claim of the Trustee as such creditor, such claim shall have
the same status as such pre-existing claim.
<PAGE>
If the Trustee shall be required to account, the funds and
property held in such special account and the proceeds thereof shall be
apportioned between the Trustee, the Securityholders and the holders of other
indenture securities in such manner that the Trustee, the Securityholders and
the holders of other indenture securities realize, as a result of payments from
such special account and payments of dividends on claims filed against the
Company in bankruptcy or receivership or in proceedings for reorganization
pursuant to the Federal Bankruptcy Act or applicable State law, the same
percentage of their respective claims, figured before crediting to the claim of
the Trustee anything on account of the receipt by it from the Company of the
funds and property in such special account and before crediting to the
respective claims of the Trustee and the Securityholders and the holders of
other indenture securities dividends on claims filed against the Company in
bankruptcy or receivership or in proceedings for reorganization pursuant to the
Federal Bankruptcy Act or applicable State law, but after crediting thereon
receipts on account of the indebtedness represented by their respective claims
from all sources other than from such dividends and from the funds and property
so held in such special account. As used in this paragraph, with respect to any
claim, the term "dividends" shall include any distribution with respect to such
claim, in bankruptcy or receivership or proceedings for reorganization pursuant
to the Federal Bankruptcy Act or applicable State law, whether such distribution
is made in cash, securities, or other property, but shall not include any such
distribution with respect to the secured portion, if any, of such claim. The
court in which such bankruptcy, receivership or proceedings for reorganization
is pending shall have jurisdiction (i) to apportion between the Trustee and the
Securityholders and the holders of other indenture securities in accordance with
the provisions of this paragraph, the funds and property held in such special
account and proceeds thereof, or (ii) in lieu of such apportionment, in whole or
in part, to give to the provisions of this paragraph due consideration in
determining the fairness of the distributions to be made to the Trustee and the
Securityholders and the holders of other indenture securities with respect to
their respective claims, in which event it shall not be necessary to liquidate
or to appraise the value of any securities or other property held in such
special account or as security for any such claim, or to make a specific
allocation of such distributions as between the secured and unsecured portions
of such claims, or otherwise to apply the provisions of this paragraph as a
mathematical formula.
Any Trustee which has resigned or been removed after the
beginning of such 3-month period shall be subject to the provisions of this
Subsection as though such resignation or removal had not occurred. If any
Trustee has resigned or been removed prior to the beginning of such 3-month
period, it shall be subject to the provisions of this Subsection if and only if
the following conditions exist:
(i) the receipt of property or reduction of claim,
which would have given rise to the obligation to account, if
such Trustee had continued as Trustee, occurred after the
beginning of such 3-month period; and
(ii) such receipt of property or reduction of claim
occurred within 3 months after such resignation or removal.
(b) There shall be excluded from the operation of Subsection
(a) of this Section a creditor relationship arising from
(1) the ownership or acquisition of securities issued under
any indenture, or any security or securities having a maturity of one
year or more at the time of acquisition by the Trustee;
(2) advances authorized by a receivership or bankruptcy court
of competent jurisdiction, or by this Indenture, for the purpose of
preserving any property which shall at any time be subject to the lien
of this Indenture or of discharging tax liens or other prior liens or
encumbrances thereon, if notice of such advances and of the
circumstances surrounding the making thereof is given to the
Securityholders at the time and in the manner provided in this
Indenture;
(3) disbursements made in the ordinary course of business in
the capacity of trustee under an indenture, transfer agent, registrar,
custodian, paying agent, fiscal agent or depositary, or other similar
capacity;
(4) an indebtedness created as a result of services rendered
or premises rented; or an indebtedness created as a result of goods or
securities sold in a cash transaction as defined in Subsection (c) of
this Section;
(5) the ownership of stock or of other securities of a
corporation organized under the provisions of Section 25(a) of the
Federal Reserve Act, as amended, which is directly or indirectly a
creditor of the Company; or
(6) the acquisition, ownership, acceptance or negotiation of
any drafts, bills of exchange, acceptances or obligations which fall
within the classification of self liquidating paper as defined in
Subsection (c) of this Section.
(c) For the purposes of this Section only:
<PAGE>
(1) The term "default" means any failure to make payment in
full of the principal of or interest on any of the Securities or upon
the other indenture securities when and as such principal or interest
becomes due and payable.
(2) The term "other indenture securities" means securities
upon which the Company is an obligor outstanding under any other
indenture (i) under which the Trustee is also trustee, (ii) which
contains provisions substantially similar to the provisions of this
Section, and (iii) under which a default exists at the time of the
apportionment of the funds and property held in such special account.
(3) The term "cash transaction" means any transaction in which
full payment for goods or securities sold is made within 7 days after
delivery of the goods or securities in currency or in checks or other
orders drawn upon banks or bankers and payable upon demand.
(4) The term "self-liquidating paper" means any draft, bill of
exchange, acceptance or obligation which is made, drawn, negotiated or
incurred by the Company for the purpose of financing the purchase,
processing, manufacturing, shipment, storage or sale of goods, wares or
merchandise and which is secured by documents evidencing title to,
possession of, or a lien upon, the goods, wares or merchandise or the
receivables or proceeds arising from the sale of the goods, wares or
merchandise previously constituting the security, provided the security
is received by the Trustee simultaneously with the creation of the
creditor relationship with the Company arising from the making,
drawing, negotiating or incurring of the draft, bill of exchange,
acceptance or obligation.
(5) The term "Company" means any obligor upon the Securities.
Section 614. Appointment of Authenticating Agent. At any time
when any of the Securities remain Outstanding the Trustee, with the approval of
the Company, may appoint an Authenticating Agent or Agents with respect to one
or more series of Securities which shall be authorized to act on behalf of the
Trustee to authenticate Securities of such series issued upon exchange,
registration of transfer or partial redemption thereof or pursuant to Section
306, and Securities so authenticated shall be entitled to the benefits of this
Indenture and shall be valid and obligatory for all purposes as if authenticated
by the Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be a corporation organized and doing business
under the laws of the United States of America, any State thereof or the
District of Columbia, authorized under such laws to act as an Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and,
if other than the Company itself, subject to supervision or examination by
Federal or State authority. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Authenticating Agent shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section, such Authenticating
Agent shall resign immediately in the manner and with the effect specified in
this Section.
<PAGE>
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and, if other than the Company, to the
Company. The Trustee may at any time terminate the agency of an Authenticating
Agent by giving written notice thereof to such Authenticating Agent and, if
other than the Company, to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee, with the approval of the Company, may
appoint a successor Authenticating Agent which shall be acceptable to the
Company and shall mail written notice of such appointment by first-class mail,
postage prepaid, to all Holders of Securities of the series with respect to
which such Authenticating Agent will serve, as their names and addresses appear
in the Security Register. Any successor Authenticating Agent upon acceptance of
its appointment hereunder shall become vested with all the rights, powers and
duties of its predecessor hereunder, with like effect as if originally named as
an Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent (other
than an Authenticating Agent appointed at the request of the Company from time
to time) reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 607.
If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternate certificate of authentication in the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By: ______________________________
As Authenticating Agent
Date: _______________ By:_______________________________
Authorized Signatory
<PAGE>
ARTICLE SEVEN
Securityholders' Lists and Reports by
Trustee and Company
Section 701. Company To Furnish Trustee Names and Addresses of
Securityholders. The Company will furnish or cause to be furnished to
the Trustee
(a) semi-annually, not more than 15 days after each Regular
Record Date, in each year in such form as the Trustee may reasonably
require, a list of the names and addresses of the Holders of Securities
of such series as of such date, and
(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a
list of similar form and content as of a date not more than 15 days
prior to the time such list is furnished,
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Section 702. Preservation of Information; Communications to
Securityholders. (a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders of Securities
contained in the most recent list furnished to the Trustee as provided in
Section 701 and the names and addresses of Holders of Securities received by the
Trustee in its capacity as Security Registrar. The Trustee may destroy any list
furnished to it as provided in Section 701 upon receipt of a new list so
furnished.
(b) If 3 or more Holders of Securities of any series
(hereinafter referred to as "applicants") apply in writing to the Trustee, and
furnish to the Trustee reasonable proof that each such applicant has owned a
Security of such series for a period of at least 6 months preceding the date of
such application, and such application states that the applicants desire to
communicate with other Holders of Securities of such series or with the Holders
of all Securities with respect to their rights under this Indenture or under
such Securities and is accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit, then the Trustee shall,
within 5 Business Days after the receipt of such application, at its election,
either
(i) afford such applicants access to the information preserved
at the time by the Trustee in accordance with Section 702(a), or
(ii) inform such applicants as to the approximate number of
Holders of Securities of such series or all Securities, as the case may
be, whose names and addresses appear in the information preserved at
the time by the Trustee in accordance with Section 702(a), and as to
the approximate cost of mailing to such Securityholders the form of
proxy or other communication, if any, specified in such application.
<PAGE>
If the Trustee shall elect not to afford such applicants
access to such information, the Trustee shall, upon the written request of such
applicants, mail to each Holder of a Security of such series or to all
Securityholders, as the case may be, whose names and addresses appear in the
information preserved at the time by the Trustee in accordance with Section
702(a), a copy of the form of proxy or other communication which is specified in
such request, with reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless, within 5 days after such tender, the
Trustee shall mail to such applicants and file with the Commission, together
with a copy of the material to be mailed, a written statement to the effect
that, in the opinion of the Trustee, such mailing would be contrary to the best
interests of the Holders of Securities of such series or all Securityholders, as
the case may be, or would be in violation of applicable law. Such written
statement shall specify the basis of such opinion. If the Commission, after
opportunity for a hearing upon the objections specified in the written statement
so filed, shall enter an order refusing to sustain any of such objections or if,
after the entry of an order sustaining one or more of such objections, the
Commission shall find, after notice and opportunity for hearing, that all the
objections so sustained have been met and shall enter an order so declaring, the
Trustee shall mail copies of such material to all Securityholders of such series
or all Securityholders, as the case may be, with reasonable promptness after the
entry of such order and the renewal of such tender; otherwise the Trustee shall
be relieved of any obligation or duty to such applicants respecting their
application.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor the
Trustee shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders of Securities in
accordance with Section 702(b), regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under Section 702(b).
Section 703. Reports by Trustee. (a) The term "reporting date"
as used in this Section means May 15 of each year. Within 60 days after the
reporting date in each year, beginning in 1998, the Trustee shall transmit by
mail to all Securityholders, as their names and addresses appear in the Security
Register, a brief report dated as of such reporting date with respect to any of
the following events which may have occurred during the 12 months preceding the
date of such report (but if no such event has occurred within such period no
report need be transmitted):
(1) any change to its eligibility under Section 609 and its
qualifications under Section 608;
(2) the creation of or any material change to a relationship
specified in Section 310(b)(1) through Section 310(b)(10) of the Trust
Indenture Act;
(3) the character and amount of any advances (and if the
Trustee elects so to state, the circumstances surrounding the making
thereof) made by the Trustee (as such) which remain unpaid on the date
of such report, and for the reimbursement of which it claims or may
claim a lien or charge, prior to that of Securities of any series, on
any property or funds held or collected by it as Trustee, except that
the Trustee shall not be required (but may elect) to report such
advances if such advances so remaining unpaid aggregate not more than
1/2 of 1% of the principal amount of the Securities of such series
outstanding on the date of such report;
(4) any change to the amount, interest rate and maturity date
of all other indebtedness owing by the Company (or by any other obligor
on the Securities) to the Trustee in its individual capacity, on the
date of such report, with a brief description of any property held as
collateral security therefor, except an indebtedness based upon a
creditor relationship arising in a manner described in Section
613(b)(2), (3), (4) or (6);
<PAGE>
(5) any change to the property and funds, if any, physically
in the possession of the Trustee as such on the date of such report;
(6) any additional issue of Securities which the Trustee has
not previously reported; and
(7) any action taken by the Trustee in the performance of its
duties hereunder which it has not previously reported and which in its
opinion materially affects the Securities, except action in respect of
a default, notice of which has been or is to be withheld by the Trustee
in accordance with Section 602.
(b) The Trustee shall transmit by mail to all Securityholders,
as their names and addresses appear in the Security Register, a brief report
with respect to the character and amount of any advances (and if the Trustee
elects so to state, the circumstances surrounding the making thereof) made by
the Trustee (as such) since the date of the last report transmitted pursuant to
Subsection (a) of this Section (or if no such report has yet been so
transmitted, since the date of execution of this instrument) for the
reimbursement of which it claims or may claim a lien or charge, prior to that of
the Securities of any series, on property or funds held or collected by it as
Trustee, and which it has not previously reported pursuant to this Subsection,
except that the Trustee shall not be required (but may elect) to report such
advances if such advances remaining unpaid at any time aggregate 10% or less of
the principal amount of the Securities Outstanding of such series at such time,
such report to be transmitted within 90 days after such time.
(c) A copy of each such report shall, at the time of such
transmission to Securityholders, be filed by the Trustee with each stock
exchange upon which the Securities are listed, and also with the Commission. The
Company will notify the Trustee when the Securities are listed on any stock
exchange.
Section 704. Reports by Company. The Company will
(1) file with the Trustee, within 15 days after the Company is
required to file the same with the Commission, copies of the annual
reports and of the information, documents and other reports (or copies
of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) which the Company may
be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934; or, if the
Company is not required to file information, documents or reports
pursuant to either of said Sections, then it will file with the Trustee
and the Commission, in accordance with rules and regulations prescribed
from time to time by the Commission, such of the supplementary and
periodic information, documents and reports which may be required
pursuant to Section 13 of the Securities Exchange Act of 1934 in
respect of a security listed and registered on a national securities
exchange as may be prescribed from time to time in such rules and
regulations;
(2) file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the
Commission, such additional information, documents and reports with
respect to compliance by the Company with the conditions and covenants
of this Indenture as may be required from time to time by such rules
and regulations; and
<PAGE>
(3) transmit by mail to all Securityholders, as their names
and addresses appear in the Security Register, within 30 days after the
filing thereof with the Trustee, such summaries of any information,
documents and reports required to be filed by the Company pursuant to
paragraphs (1) and (2) of this Section as may be required by rules and
regulations prescribed from time to time by the Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance or Transfer
Section 801. Company May Consolidate, etc., only on Certain
Terms. The Company shall not consolidate with or merge into any other
corporation or convey or transfer its properties and assets substantially as an
entirety to any Person, unless:
(1) the corporation formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance or
transfer the properties and assets of the Company substantially as an
entirety shall be a corporation organized and existing under the laws
of the United States of America or any State or the District of
Columbia, and shall expressly assume, by an indenture supplemental
hereto, executed and delivered to the Trustee, in form satisfactory to
the Trustee, the due and punctual payment of the principal of (and
premium, if any) and interest on all the Securities and the performance
of every covenant of this Indenture on the part of the Company to be
performed or observed;
(2) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time, or
both, would become an Event of Default, shall have happened and be
continuing; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance or transfer and such supplemental
indenture comply with this Article and that all conditions precedent
herein provided for relating to such transaction have been complied
with.
Section 802. Successor Corporation Substituted. Upon any
consolidation or merger, or any conveyance or transfer of the properties and
assets of the Company substantially as an entirety in accordance with Section
801, the successor corporation formed by such consolidation or into which the
Company is merged or to which such conveyance or transfer is made 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 as the Company herein. In the event of any such
conveyance or transfer, the Company as the predecessor corporation may be
dissolved, wound up or liquidated at any time thereafter.
ARTICLE NINE
Supplemental Indentures
<PAGE>
Section 901. Supplemental Indentures Without Consent of
Securityholders. Without the consent of the Holders of any Securities, the
Company, when authorized by a Board Resolution, 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 evidence the succession of another corporation to the
Company, and the assumption by any such successor of the covenants of
the Company herein and in the Securities contained; or
(2) to add to the covenants of the Company, or to surrender
any right or power herein conferred upon the Company, for the benefit
of the Holders of the Securities of any or all series (and if such
covenants or the surrender of such right or power are to be for the
benefit of less than all series of Securities, stating that such
covenants are expressly being included or such surrenders are expressly
being made solely for the benefit of one or more specified series); or
(3) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture; or
(4) to add to this Indenture such provisions as may be
expressly permitted by the TIA, excluding, however, the provisions
referred to in Section 316(a)(2) of the TIA as in effect at the date as
of which this instrument was executed or any corresponding provision in
any similar federal statute hereafter enacted; or
(5) to establish any form of Security, as provided in Article
Two, and to provide for the issuance of any series of Securities as
provided in Article Three and to set forth the terms thereof, and/or to
add to the rights of the Holders of the Securities of any series; or
(6) to evidence and provide for the acceptance of appointment
by another corporation as a successor Trustee hereunder with respect to
one or more series of Securities and to add to or change any of the
provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one
Trustee, pursuant to Section 611; or
(7) to add any additional Events of Default in respect of the
Securities of any or all series (and if such additional Events of
Default are to be in respect of less than all series of Securities,
stating that such Events of Default are expressly being included solely
for the benefit of one or more specified series); or
(8) to provide for the issuance of Securities in coupon as
well as fully registered form.
No supplemental indenture for the purposes identified in
Clauses (2), (3), (5) or (7) above may be entered into if to do so would
adversely affect the interest of the Holders of Securities of any series.
<PAGE>
Section 902. Supplemental Indentures with Consent of
Securityholders. With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture or indentures, by Act of said Holders delivered to the
Company and the Trustee, the Company, when authorized by a Board Resolution, and
the Trustee may 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 of modifying in any manner the rights
of the Holders of the Securities of each such series under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Security affected thereby,
(1) change the Maturity of the principal of, or the Stated
Maturity of any premium on, or any installment of interest on, any
Security, or reduce the principal amount thereof or the interest or any
premium thereon, or change the method of computing the amount of
principal thereof or interest thereon on any date or change any Place
of Payment where, or the coin or currency in which, any Security or any
premium or interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the
Maturity or the Stated Maturity, as the case may be, thereof (or, in
the case of redemption or repayment, on or after the Redemption Date or
the Repayment Date, as the case may be); or
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences, provided for in this Indenture; or
(3) modify any of the provisions of this Section or Section
513, except to increase any such percentage or to provide that certain
other provisions of this Indenture cannot be modified or waived without
the consent of the Holder of each Outstanding Security affected
thereby.
A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which has expressly been included
solely for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Securityholders under
this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
Section 903. Execution of Supplemental Indentures. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 601) shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee may, but shall not (except to the
extent required in the case of a supplemental indenture entered into under
Section 901(4) or 901(6)) be obligated to, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
<PAGE>
Section 904. Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article, this Indenture shall
be modified in accordance therewith, and such supplemental indenture shall form
a part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby to the extent provided therein.
Section 905. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall conform to the
requirements of the TIA as then in effect.
Section 906. Reference in Securities to Supplemental
Indentures. Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest. With
respect to each series of Securities, the Company will duly and punctually pay
the principal of (and premium, if any) and interest on such Securities in
accordance with their terms and this Indenture, and will duly comply with all
the other terms, agreements and conditions contained in, or made in the
Indenture for the benefit of, the Securities of such series.
Section 1002. Maintenance of Office or Agency. The Company
will maintain an office or agency in each Place of Payment where Securities may
be presented or surrendered for payment, where Securities may be surrendered for
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 will
give prompt written notice to the Trustee of the location, and of any change in
the location, of such office or agency. If at any time the Company shall fail to
maintain such office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the principal Corporate Trust Office of the Trustee, and the
Company hereby appoints the Trustee its agent to receive all such presentations,
surrenders, notices and demands.
Section 1003. Money for Security Payments to be Held in Trust.
If the Company shall at any time act as its own Paying Agent for any series of
Securities, it will, on or before each due date of the principal of (and
premium, if any) or interest on, any of the Securities of such series, segregate
and hold in trust for the benefit of the Persons entitled thereto a sum
sufficient to pay the principal (and premium, if any) or interest so becoming
due until such sums shall be paid to such Persons or otherwise disposed of as
herein provided, and will promptly notify the Trustee of its action or failure
to act.
Whenever the Company shall have one or more Paying Agents for
any series of Securities, it will, on or prior to each due date of the principal
of (and premium, if any) or interest on, any Securities of such series, deposit
with a Paying Agent a sum sufficient to pay the principal (and premium, if any)
or interest so becoming due, such sum to be held in trust for the benefit of the
Persons entitled to such principal (and premium, if any) or interest, and
(unless such Paying Agent is the Trustee) the Company will promptly notify the
Trustee of its action or failure so to act.
<PAGE>
The Company will cause each Paying Agent other than the
Trustee for any series of Securities to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will
(1) hold all sums held by it for the payment of principal of
(and premium, if any) or interest on Securities of such series in trust
for the benefit of the Persons entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or
any other obligor upon the Securities of such series) in the making of
any such payment of principal (and premium, if any) or interest on the
Securities of such series; and
(3) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture with respect to any series
of Securities or for any other purpose, pay, or by Company Order direct
any Paying Agent to pay, to the Trustee all sums held in trust by the
Company or such Paying Agent in respect of each and every series of
Securities as to which it seeks to discharge this Indenture or, if for
any other purpose, all sums so held in trust by the Company in respect
of all Securities, such sums to be held by the Trustee upon the same
trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability
with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of (and
premium, if any) or interest on any Security of any series 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 Company Request, or
(if then held by the Company) shall be discharged from such trust; and the
Holder of such Security shall thereafter, as an unsecured general creditor, look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease. The Trustee or such Paying
Agent, before being required to make any such repayment, may at the expense of
the Company mail to the Holders of the Securities as to which the money to be
repaid was held in trust, as their names and addresses appear in the Security
Register, a notice that such moneys remain unclaimed and that, after a date
specified in the notice, which shall not be less than 30 days from the date on
which the notice was first mailed to the Holders of the Securities as to which
the money to be repaid was held in trust, any unclaimed balance of such moneys
then remaining will be paid to the Company free of the trust formerly impressed
upon it.
The Company initially authorizes the Trustee to act as Paying
Agent for the Securities on its behalf. The Company may at any time and from
time to time authorize one or more Persons to act as Paying Agent in addition to
or in place of the Trustee with respect to any series of Securities issued under
this Indenture.
<PAGE>
Section 1004. Statement as to Compliance. The Company will
deliver to the Trustee, within 120 days after the end of each fiscal year, a
written statement signed by the principal executive officer, principal financial
officer or principal accounting officer of the Company, stating that
(1) a review of the activities of the Company during such year
and of the Company's performance under this Indenture and under the
terms of the Securities has been made under his supervision; and
(2) to the best of his knowledge, based on such review, the
Company has complied with all conditions and covenants under this
Indenture through such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known
to him and the nature and status thereof.
For purposes of this Section 1004, compliance shall be
determined without regard to any grace period or requirement of notice provided
pursuant to the terms of this Indenture.
Section 1005. Corporate Existence. Subject to Article Eight
the Company will do or cause to be done all things necessary to preserve and
keep in full force and effect its corporate existence.
Section 1006. Limitation on Mortgages. The Company will not,
nor will it permit any Restricted Subsidiary to, create, assume, incur or suffer
to exist (i) any Mortgage upon any stock or indebtedness of any Restricted
Subsidiary, whether owned on the date of this Indenture or hereafter acquired,
to secure any Debt of the Company or any other Person (other than the
Securities), and (ii) any Mortgage upon any Principal Property, whether owned or
leased on the date of this Indenture, or thereafter acquired, to secure any Debt
of the Company or any other person (other than the Securities) without in any
such case making effective provision whereby all of the Securities Outstanding
shall be directly secured equally and ratably with such Debt, excluding,
however, from the operation of the foregoing provisions of this Section 1006 any
Mortgage upon stock or indebtedness of any corporation existing at the time such
corporation becomes a Subsidiary, or existing upon stock or indebtedness of a
Subsidiary at the time of acquisition of such stock or indebtedness, and any
extension, renewal or replacement (or successive extensions, renewals or
replacements) in whole or in part of any such Mortgage; provided, however, that
the principal amount of Debt secured thereby shall not exceed the principal
amount of Debt so secured at the time of such extension, renewal or replacement;
and provided further, that such Mortgage shall be limited to all or such part of
the stock or indebtedness which secured the Mortgage so extended, renewed or
replaced.
Notwithstanding the foregoing, the Company may, and may permit
any Restricted Subsidiary to, create, assume, incur or suffer to exist (i) any
Permitted Mortgages and (ii) any Mortgage upon any Principal Property without
equally and ratably securing the Senior Debt Securities if the aggregate amount
of all Debt then outstanding secured by such Mortgage and all similar Mortgages
does not exceed 15% of the total consolidated stockholders' equity (including
preferred stock) of the Company as shown on the audited consolidated balance
sheet contained in the latest annual report to stockholders of the Company;
provided that Debt secured by Permitted Mortgages shall not be included in the
amount of such secured Debt.
<PAGE>
Section 1007. Limitation on Sale and Leaseback Transactions.
The Company will not, nor will it permit any Restricted Subsidiary to, enter
into any arrangement with any person providing for the leasing by the Company or
a Restricted Subsidiary as lessee of any Principal Property (except for
temporary leases for a term, including renewals, of not more than three years),
which property has been or is to be sold or transferred by the Company or such
Restricted Subsidiary to such person (herein referred to as a "Sale-Leaseback
Transaction"), unless (i) such Sale-Leaseback Transaction occurs within 120 days
from the date of acquisition of such Principal Property or the date of the
completion of construction or commencement of full operations on such Principal
Property, whichever is later, or (ii) the Company, within 120 days after such
Sale-Leaseback Transaction, applies or causes to be applied to the retirement of
Funded Debt of the Company or any Subsidiary (other than Funded Debt of the
Company which by its terms or the terms of the instrument pursuant to which it
was issued is subordinate in right of payment to the Senior Debt Securities) an
amount not less than the net proceeds of the sale of such Principal Property.
Notwithstanding the foregoing provisions, the Company may, and may permit any
Restricted Subsidiary to, effect any Sale-Leaseback Transaction involving any
Principal Property, provided that the net sale proceeds from such Sale-Leaseback
Transaction, together with all Debt secured by Mortgages other than Permitted
Mortgages, does not exceed 15% of the total consolidated stockholders' equity of
the Company as shown on the audited consolidated balance sheet contained in the
latest annual report to shareholders of the Company.
Section 1008. Waiver of Certain Covenants. The Company may
omit in respect of any series of Securities, in any particular instance, to
comply with any covenant or condition set forth in Section 1006, if before or
after the time for such compliance the Holders of at least a majority in
principal amount of the Securities at the time Outstanding of such series shall,
by Act of such Securityholders, either waive such compliance in such instance or
generally waive compliance with such covenant or condition, but no such waiver
shall extend to or affect such covenant or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such covenant or
condition shall remain in full force and effect.
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article. The Company may
reserve the right to redeem and pay before Stated Maturity all or any part of
the Securities of any series, either by optional redemption, sinking or purchase
fund or analogous obligation or otherwise, by provision therefor in the form of
Security for such series established and approved pursuant to Section 202 and on
such terms as are specified in such form or in the Board Resolution or indenture
supplemental hereto with respect to Securities of such series as provided in
Section 301. Redemption of Securities of any series shall be made in accordance
with the terms of such Securities and, to the extent that this Article does not
conflict with such terms, the succeeding Sections of this Article. 71
Section 1102. Election to Redeem; Notice to Trustee. The
election of the Company to redeem any Securities redeemable at the election of
the Company shall be evidenced by, or made pursuant to authority granted by, a
Board Resolution. In case of any redemption at the election of the Company of
any Securities of any series, the Company shall, at least 60 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Securities of such series to be redeemed.
<PAGE>
In the case of any redemption of Securities (i) prior to the
expiration of any restriction on such redemption provided in the terms of such
Securities or elsewhere in this Indenture, or (ii) pursuant to an election of
the Company which is subject to a condition specified in the terms of such
Securities, the Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with such restriction or condition.
Section 1103. Selection by Trustee of Securities to Be
Redeemed. If less than all the Securities of like tenor and terms of any series
are to be redeemed, the particular Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series not previously called for redemption, by
such method as the Trustee shall deem fair and appropriate and which may include
provision for the selection for redemption of portions of the principal of
Securities of such series of a denomination larger than the minimum authorized
denomination for Securities of that series. Unless otherwise provided in the
terms of a particular series of Securities, the portions of the principal of
Securities so selected for partial redemption shall be equal to the minimum
authorized denomination of the Securities of such series, or an integral
multiple thereof, and the principal amount which remains outstanding shall not
be less than the minimum authorized denomination for Securities of such series.
If less than all the Securities of unlike tenor and terms of a series are to be
redeemed, the particular Securities to be redeemed shall be selected by the
Company.
The Trustee shall promptly notify the Company 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.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Security redeemed or to be redeemed only in
part, to the portion of the principal of such Security which has been or is to
be redeemed.
Section 1104. Notice of Redemption. Notice of redemption shall
be given by first-class mail, postage prepaid, mailed not less than 30 nor more
than 60 days prior to the Redemption Date, to each holder of Securities to be
redeemed, at his address appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) if less than all Outstanding Securities of any series are
to be redeemed, the identification, including CUSIP numbers, (and, in
the case of partial redemption, the respective principal amounts) of
the Securities to be redeemed, from the Holder to whom the notice is
given;
(4) that on the Redemption Date the Redemption Price will
become due and payable upon each such Security, and that interest, if
any, thereon shall cease to accrue from and after said date;
<PAGE>
(5) the place where such Securities are to be surrendered for
payment of the Redemption Price, which shall be the office or agency of
the Company in the Place of Payment; and
(6) that the redemption is on account of a sinking or purchase
fund, or other analogous obligation, if that be the case.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company. Such
notice shall be deemed to have been given to each Holder if sent in accordance
with Section 105 hereof.
Section 1105. Deposit of Redemption Price. On or prior to
10:00 a.m. on any Redemption Date, the Company shall deposit with the Trustee or
with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 1003) an amount of money
sufficient to pay the Redemption Price of all the Securities which are to be
redeemed on that date.
Section 1106. Securities Payable on Redemption Date. Notice of
Redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified and from and after such date (unless the Company shall default
in the payment of the Redemption Price) such Securities shall cease to bear
interest. Upon surrender of such Securities for redemption in accordance with
the notice, such Securities shall be paid by the Company at the Redemption
Price. Installments of interest the Stated Maturity of which is on or prior to
the Redemption Date shall be payable to the Holders of such Securities
registered as such on the relevant Regular Record Dates according to their terms
and the provisions of Section 307.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal shall, until paid, bear
interest from the Redemption Date at the rate borne by the Security, or as
otherwise provided in such Security.
Section 1107. Securities Redeemed in Part. Any Security which
is to be redeemed only in part shall be surrendered at the office or agency of
the Company in the Place of Payment with respect to that series (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing) and the
Company shall execute and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or Securities of
the same series and Stated Maturity and of like tenor and terms, of any
authorized denomination as requested by such Holder in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
<PAGE>
Section 1108. Provisions with Respect to any Sinking Funds.
Unless the form or terms of any series of Securities shall provide otherwise, in
lieu of making all or any part of any mandatory sinking fund payment with
respect to such series of Securities in cash, the Company may at its option (1)
deliver to the Trustee for cancellation any Securities of such series
theretofore acquired by the Company, or (2) receive credit for any Securities of
such series (not previously so credited) acquired by the Company and theretofore
delivered to the Trustee for cancelation or redeemed by the Company other than
through the mandatory sinking fund, and if it does so then (i) Securities so
delivered or credited shall be credited at the applicable sinking fund
Redemption Price with respect to Securities of such series, and (ii) on or
before the 60th day next preceding each sinking fund Redemption Date with
respect to such series of Securities, the Company will deliver to the Trustee
(A) an Officers' Certificate specifying the portions of such sinking fund
payment to be satisfied by payment of cash and by delivery or credit of
Securities of such series acquired by the Company or so redeemed, and (B) such
Securities so acquired, to the extent not previously surrendered. Such Officers'
Certificate shall also state the basis for such credit and that the Securities
for which the Company elects to receive credit have not been previously so
credited and were not redeemed by the Company through operation of the mandatory
sinking fund, if any, provided with respect to such Securities and shall also
state that no Event of Default with respect to Securities of such series has
occurred and is continuing. All Securities so delivered to the Trustee shall be
canceled by the Trustee and no Securities shall be authenticated in lieu
thereof.
If the sinking fund payment or payments (mandatory or
optional) with respect to any series of Securities made in cash plus any unused
balance of any preceding sinking fund payments with respect to Securities of
such series made in cash shall exceed $50,000 (or a lesser sum if the Company
shall so request), unless otherwise provided by the terms of such series of
Securities, that cash shall be applied by the Trustee on the sinking fund
Redemption Date with respect to Securities of such series next following the
date of such payment to the redemption of Securities of such series at the
applicable sinking fund Redemption Price with respect to Securities of such
series, together with accrued interest, if any, to the date fixed for
redemption, with the effect provided in Section 1106. The Trustee shall select,
in the manner provided in Section 1103, for redemption on such sinking fund
Redemption Date a sufficient principal amount of Securities of such series to
utilize that cash and shall thereupon cause notice of redemption of the
Securities of such series for the sinking fund to be given in the manner
provided in Section 1104 (and with the effect provided in Section 1106) for the
redemption of Securities in part at the option of the Company. Any sinking fund
moneys not so applied or allocated by the Trustee to the redemption of
Securities of such series shall be added to the next cash sinking fund payment
with respect to Securities of such series received by the Trustee and, together
with such payment, shall be applied in accordance with the provisions of this
Section 1108. Any and all sinking fund moneys with respect to Securities of any
series held by the Trustee at the Maturity of Securities of such series, and not
held for the payment or redemption of particular Securities of such series,
shall be applied by the Trustee, together with other moneys, if necessary, to be
deposited sufficient for the purpose, to the payment of the principal of the
Securities of such series at Maturity.
On or before each sinking fund Redemption Date provided with
respect to Securities of any series, the Company shall pay to the Trustee in
cash a sum equal to all accrued interest, if any, to the date fixed for
redemption on Securities to be redeemed on such sinking fund Redemption Date
pursuant to this Section 1108.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
CLEAR CHANNEL COMMUNICATIONS, INC.,
by /s/ Randall Mays
Name: Randall Mays
Title: Executive Vice President
and Chief Financial Officer
THE BANK OF NEW YORK, as Trustee
by /s/ Denise Leonard
Name: Denise Leonard
Title: Assistant Treasurer
