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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): February 9, 1998
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SFX BROADCASTING, INC.
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(Exact name of registrant as specified in charter)
Delaware 0-22486 13-3649750
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(State or Other Jurisdiction (Commission File No.) (IRS Employer
of Incorporation) Identification No.)
650 Madison Avenue, 16th Floor, New York, New York 10022
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 838-3100
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150 E. 58th Street, 19th Floor, New York, NY 10155
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
Amendment to Merger Agreement
On February 9, 1998, SFX Broadcasting, Inc. (the "Company") entered
into Amendment No. 1 to the Agreement and Plan of Merger, dated as of February
9, 1998, by and among the Company, SBI Holding Corporation and SBI Radio
Acquisition Corporation, to effect certain minor and technical amendments and
to amend certain provisions relating to the working capital adjustment
contained in the Agreement and Plan of Merger among the same parties, dated
August 24, 1997. The Agreement and Plan of Merger provides for, among other
things, the spin-off of all of the capital stock of SFX Entertainment, Inc., a
wholly owned subsidiary of the Company ("Entertainment") to the stockholders of
the Company on a pro-rata basis (the "Spin-Off").
Completion of Consent Solicitations by the Company
The solicitations of consents by the Company pursuant to the Consent
Solicitation Statements dated January 7, 1998, as supplemented on January 28,
1998, copies of which were previously distributed to holders of the Company's
outstanding 10 3/4% Senior Subordinated Notes due 2006 (the "Notes") and
holders of the Company's 12 5/8% Series E Cumulative Exchangeable Preferred
Stock due October 31, 2006 (the "Shares"), were completed on February 3,
1998. The consent solicitations sought the consent of (i) holders of the Notes
to certain proposed amendments to the indenture pursuant to which the Notes
were issued and (ii) holders of the Shares to certain proposed amendments to
the Certificates of Designations in respect of the Shares.
On February 2, 1998, the Company executed the Supplemental Indenture
setting forth the amendments in respect of the Notes. On February 10, 1998, the
Company filed the Certificate of Designations setting forth the amendments in
respect of the Shares. On February 11, 1998, the Company delivered the balance
of the consent fees to those holders of the Notes and the Shares who delivered
consents prior to the expiration of the consent solicitations. Partial payment
of the consent fees was made on February 4, 1998. A copy of the press release
announcing the completion of the consent solicitations is attached hereto as
an exhibit.
Private Placement by SFX Entertainment
On February 11, 1998, Entertainment completed the private placement of
$350 million in 9 1/8% Senior Subordinated Notes due 2008 (the "Offering").
The Entertainment Notes are general unsecured obligations of Entertainment,
subordinate in right of payment to all existing and future Senior Debt (as
defined in the Indenture governing the Entertainment Notes) of Entertainment.
The Entertainment Notes are guaranteed on a senior subordinated basis by the
Guarantors (as defined in the Indenture governing the Notes). The terms of the
Entertainment Notes are set forth in the Indenture filed as Exhibit 10.2
hereto.
The sale of securities offered in the Offering was not registered
under the Securities Act of 1933, as amended, and may not be offered or sold in
the United States absent registration or an applicable exemption from
registration requirements. The information contained in this Current Report on
Form 8-K does not constitute an offer to sell or a solicitation of an offer to
buy the securities offered in the Offering.
Additional Information Regarding SFX Entertainment
To ensure that the market is provided with substantially the same
disclosure as that contained in the registration statement of Entertainment
with respect to the Spin-Off (on Form S-1 (File No. 333-43287) and filed
herewith as Exhibit 99.1), certain information set forth in such registration
statement, including the prospectus and financial information, is incorporated
herein by reference. The information in the registration statement is
preliminary and is subject to completion and amendment.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
Exhibits
10.1 Amendment No. 1 to Agreement and Plan of Merger, dated February 9,
1998, by and among SFX Broadcasting, Inc., SBI Holding Corporation and
SBI Radio Acquisition Corporation.
10.2 Indenture, dated February 11, 1998, by and among SFX Entertainment,
Inc. ("Entertainment"), certain of its subsidiaries and The Chase
Manhattan Bank.
10.3 Registration Rights Agreement, dated February 11, 1998, by and among
Entertainment, certain of its subsidiaries as Guarantors, and Lehman
Brothers, Inc., Goldman Sachs & Co., BNY Capital Markets, Inc. and ING
Barings.
23.1 Consent of Ernst & Young, LLP.
23.2 Consent of Arthur Andersen LLP.
23.3 Consent of Price Waterhouse LLP.
99.1 Registration Statement of Entertainment on Form S-1, as amended (File
No. 333-43287), (incorporated herein by reference).
99.2 Press release issued by SFX Entertainment Inc., dated February 9,
1998.
99.3 Press release issued by SFX Broadcasting Inc., dated February 13,
1998.
99.4 Press release issued by SFX Broadcasting Inc., dated February 13,
1998
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereto duly authorized.
SFX BROADCASTING, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: General Counsel, Executive
Vice President and Secretary
Date: February 17, 1998
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AMENDMENT NO. 1
TO
AGREEMENT AND PLAN OF MERGER
AMONG
SBI HOLDING CORPORATION,
SBI RADIO ACQUISITION CORPORATION
AND
SFX BROADCASTING, INC.
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AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER dated as of February
9, 1998, among SBI Holding Corporation, a Delaware corporation ("Parent"), SBI
Radio Acquisition Corporation, a Delaware corporation and a wholly owned
subsidiary of Parent ("Sub"), and SFX Broadcasting, Inc., a Delaware
corporation (the "Company").
WHEREAS, Parent, Sub and the Company have entered into an Agreement
and Plan of Merger, dated as of August 24, 1997 (the "Merger Agreement"),
pursuant to which, among other things, the parties agreed to the merger of Sub
with and into the Company (the "Merger"), upon the terms and subject to the
conditions set forth in the Merger Agreement;
WHEREAS, the parties to the Merger Agreement desire to amend certain
terms and conditions thereof, as set forth herein; and
WHEREAS, capitalized terms used herein have the meanings ascribed to
them in the Merger Agreement;
NOW, THEREFORE, the parties to the Merger Agreement further agree as
follows:
1. Section 1.02 of the Merger Agreement is hereby amended to delete the words
"January 2, 1998" and to insert the words "the date that is fifteen (15)
business days after the Merger Approval (as defined in Section 6.01(a)) is
obtained so long as the Merger Approval is obtained on or before April 24,
1998" in lieu thereof.
2. Section 2.02(a) of the Merger Agreement is hereby amended to delete the
words "bank or trust Company" and to insert the words "bank or trust company"
in lieu thereof.
3. Section 2.03(a)(iv) of the Merger Agreement is hereby amended to delete the
words "the Company" and to insert the word "MMR" in lieu thereof.
4. Section 3.01(d)(4) of the Merger Agreement is hereby amended to delete the
words "a certificate of amendment" and to insert the words "one or more
certificates of amendment" in lieu thereof.
5. The first sentence of Section 3.01(k) of the Merger Agreement is hereby
amended and restated in its entirety as follows:
"The affirmative vote of the holders of a majority of the voting power
of all outstanding shares of Common Stock voting as a single class,
and the affirmative vote of the holders of a majority of the voting
power of all outstanding shares of Class A Common Stock, Series D
Preferred Stock and/or Series E Preferred Stock, each voting as a
separate class, at the Stockholders Meeting or by written consent in
lieu thereof are the only votes of holders of any class or series of
the Company's capital stock necessary to approve or adopt the
Amendments."
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6. Section 3.01(s) of the Merger Agreement is hereby amended to delete the
words "Stockholder Meeting" and to insert the words "Stockholders Meeting" in
lieu thereof.
7. The last sentence of Section 4.01(a) of the Merger Agreement is hereby
amended and restated in its entirety as follows:
"Notwithstanding anything herein to the contrary, the Company and its
Subsidiaries may engage in any of the transactions contemplated by
Section 5.07, including, without limitation, any (x) acquisitions by
any of the Delsener/Slater Group, whether or not the performance of
any obligations under the agreements related to such acquisitions are
guaranteed by the Company (provided that any such guarantee shall
terminate as of or before the Effective Time), (y) financing related
to the Delsener/Slater Group and/or such acquisitions (including,
without limitation, any incurrence of indebtedness), whether or not
incurred or guaranteed by the Company (provided that any such
guarantee shall terminate as of or before the Effective Time), and (z)
issuance of shares of Delsener/Slater Holdings common stock."
8. Section 4.01(a)(ii) of the Company Disclosure Schedule is hereby amended by
the addition of the following:
"The Company may transfer the option related to the Meadow Shares (as
defined in Section 5.07(i) upon such terms and conditions as
reasonably acceptable to Parent, which consent shall not be
unreasonably withheld."
9. The first sentence of Section 4.03(a) of the Merger Agreement is hereby
amended and restated in its entirety as follows:
"The Company will, as soon as practicable following the date of this
Agreement, (i) duly call, give notice of, convene and hold a meeting
of its stockholders (the "Stockholders Meeting") for the purpose of
obtaining Stockholder Approval of (A) the Amendments to Sections 5.1,
5.2 and 5.6 of the Company's Restated Certificate of Incorporation and
(B) this Agreement and the Merger and (ii) will commence one or more
solicitations of written consents in lieu of a meeting for the purpose
of obtaining the Stockholder Approval of the Amendments not referenced
in item (i) above."
10. Item (b) of the first paragraph of Section 5.07 of the Merger Agreement is
hereby amended to insert the words ", to the holders of Series D Preferred
Stock and (if the Company so elects) to the holders of interests in the
Company's Director Deferred Stock Purchase Plan" immediately following the
words "distribute pro rata to the holders of Common Stock".
11. The penultimate sentence of the first paragraph of Section 5.07 of the
Merger Agreement is hereby amended and restated to delete the words "document
the contractual relationship between
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Delsener/Slater and the Company" and to insert the words "document the
contractual relationship between Delsener/Slater Holdings and the Company" in
lieu thereof.
12. Section 5.07(f)(iii) of the Merger Agreement is hereby amended and restated
in its entirety as follows:
"(iii) The Company shall, or shall cause its Subsidiaries to, as
applicable, contribute, transfer or convey to Delsener/Slater
Holdings, prior to the Spin Off (or at such time contemplated by
Section 5.07(h)), the assets described in Section 5.07(f)(iii) of the
Company Disclosure Schedule, and Delsener/Slater Holdings shall assume
all of the Company's and such Subsidiaries' obligations under such
agreements to the extent set forth on such schedule."
13. Section 5.07(h) of the Merger Agreement is hereby amended by inserting the
words "; provided, however, that the Delsener/Slater Group may solicit and
contract for the employment, effective no earlier than the Effective Time, of
Spin Off Employees" immediately following the words "not currently engaged in
the Entertainment Business".
14. Item (v) of the paragraph that immediately follows Section 5.07(i)(iv) of
the Merger Agreement is hereby amended to delete the words "permitted by
Section 4.01(a)(viii)" and to insert the words "permitted by Section
4.01(a)(vii)" in lieu thereof.
15. The paragraph that immediately follows Section 5.07(i)(iv) of the Merger
Agreement is hereby amended to insert the following at the end of the
paragraph:
", and (xii) be reduced by the amount of the Series E Premium (as
defined below).
The term "Series E Premium" shall mean the difference between (i) the
Average Trading Price times 142,032 and (ii) 14,203,200. The term
"Average Trading Price" shall mean the highest of the following
averages: (i) the average of the last sales price of the Series E
Preferred Stock during the 15 consecutive business days ending on the
Closing Date, or (ii) the average of the last sales price of the
Series E Preferred Stock during the 15 consecutive business days
immediately preceding February 9, 1998.
16. Section 5.07(k) of the Merger Agreement is hereby amended to insert the
words "place deposits on and" immediately prior to the words "consummate such
acquisitions and capital improvements."
17. Section 6.01(a) of the Merger Agreement is hereby amended and restated in
its entirety as follows:
"(a) Merger Approval. The Stockholder Approval shall have been
obtained with respect to (i) the approval and adoption of this
Agreement and the
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Merger and (ii) the Amendments that modify Sections 5.1 and 5.6 of the
Company's Restated Certificate of Incorporation (collectively, the
"Merger Approval")."
18. Section 6.03 of the Merger Agreement is hereby amended by the addition of
the following paragraph (c) thereto:
"(c) Grace Period If Stockholder Approval Is Not Obtained for
Other Amendments. If the Stockholder Approval of the Amendments other
than those contained in Sections 5.1 and 5.6 of the Company's Restated
Certificate of Incorporation is not obtained by the date the Merger
Approval is obtained at the Stockholders Meeting, then at least
forty-five (45) days shall have passed from such date; provided,
however, that if such forty-five day period would end after May 14,
1998, such period shall be deemed to end on May 14, 1998."
19. Section 7.01(b)(i) of the Merger Agreement is hereby amended and restated
in its entirety as follows:
"(i) (A) if, upon a vote at a duly held Stockholders Meeting or
any adjournment thereof at which the Merger Approval shall have been
voted upon, any portion of the Merger Approval shall not have been
obtained or (B) unless (1) prohibited by an event described in either
clause (iii) or (v) of this Section 7.01(b) or (2) resulting from any
act or omission of Parent or Sub or their Affiliates, as of the day
immediately prior to the Termination Date either (x) no Stockholders
Meeting shall have been held or (y) if held no vote shall have been
taken in respect of the Merger Approval;"
20. Section 7.01(c) of the Merger Agreement is hereby amended to delete the
words "Stockholder Approval," and to insert "Merger Approval," in lieu thereof.
21. Annex A to the Merger Agreement is hereby amended and restated in its
entirety as set forth on Annex A hereto.
22. Pursuant to Section 4.01(a) of the Merger Agreement, Buyer hereby consents
to, and waives the application of any representations, warranties and covenants
of the Merger Agreement otherwise prohibiting, the solicitation of consents of
the holders of 2006 Notes and Series E Preferred Stock as described in the two
consent solicitations of the Company dated January 7, 1998, as amended,
relating thereto.
23. Except to the extent expressly set forth in this Amendment No. 1 to
Agreement and Plan of Merger, no terms and conditions of the Merger Agreement
are amended or modified hereby, and all such terms and conditions shall remain
in full force and effect.
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IN WITNESS WHEREOF, Parent, Sub and the Company have caused this
Amendment No. 1 to the Merger Agreement to be signed by their respective
officers thereunto duly authorized, all as of the date first written above.
SBI HOLDING CORPORATION
By: /s/ Eric Neuman
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Name: Eric Neuman
Title: Vice President
SBI RADIO ACQUISITION CORPORATION
By: /s/ Eric Neuman
-------------------------------
Name: Eric Neuman
Title: Vice President
SFX BROADCASTING, INC.
By: /s/ Robert F.X. Sillerman
-------------------------------
Name: Robert F.X. Sillerman
Title: Executive Chairman
<PAGE>
ANNEX A
FORM OF AMENDMENTS TO THE
CORPORATION'S CERTIFICATE OF INCORPORATION
Section 5.1 of the Corporation's Restated Certificate of Incorporation
shall be amended to read in its entirety as follows (except for the section
heading, underlined language is new):
5.1 Identical Rights. Except as herein otherwise expressly
provided in this Restated Certificate of Incorporation, including,
without limitation, in connection with any transactions excepted from
Sections 5.2 or 5.6 hereof, all Common Shares shall be identical and
shall entitle the holders thereof to the same rights and privileges.
Section 5.2(a) of the Corporation's Restated Certificate of
Incorporation shall be amended to read in its entirety as follows (except for
the section heading, underlined language is new):
5.2. Dividends. (a) When, as, and if dividends are declared
by the Corporation's Board of Directors (the "Board of Directors"),
whether payable in cash, in property, or in securities of the
Corporation, the holders of Common Shares shall be entitled to share
equally in and to receive, in accordance with the number of Common
Shares held by each such holder, all such dividends, except that if
dividends are declared that are payable in Common Shares, such stock
dividends shall be payable at the same rate on each class of Common
Shares and shall be payable only in Class A Shares to holders of Class
A Shares, in Class B Shares to holders of Class B Shares and in Class
C Shares to holders of Class C Shares, and except that the holders of
the Class A Shares shall receive shares of class A common stock of SFX
Live Entertainment, Inc. in the Spin Off (as defined in the Agreement
and Plan of Merger, dated as of August 24, 1997, as it may be amended
from time to time, among SBI Holding Corporation, SBI Radio
Acquisition Corporation and the Corporation) having rights, powers and
privileges similar to the Class A Shares, and the holders of the Class
B Shares shall receive shares of class B common stock of SFX Live
Entertainment, Inc. in the Spin Off having rights, powers and
privileges similar to the Class B Shares.
Section 5.6 of the Corporation's Restated Certificate of Incorporation
shall be amended to read in its entirety as follows (except for the section
heading, underlined language is new):
5.6 Consideration on Merger, Consolidation, etc. In any
merger, consolidation, or business combination, the consideration to
be received per share by the holders of Class A Shares, Class B Shares
and Class C Shares must be identical for each class of stock, except
that in any such transaction in which shares of
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common stock are to be distributed, such shares may differ as to
voting rights to the extent that voting rights now differ among the
Class A Shares, the Class B Shares and the Class C Shares, except
that, in connection with the transactions contemplated by the
Agreement and Plan of Merger, dated as of August 24, 1997, as it may
be amended from time to time (the "Merger Agreement"), among SBI
Holding Corporation, SBI Radio Acquisition Corporation and the
Corporation, each Class A Share shall receive the Class A Common Stock
Merger Consideration (as such term is defined in the Merger Agreement)
and each Class B Share shall receive the Class B Common Stock Merger
Consideration (as such term is defined in the Merger Agreement), and
except that the provisions of this Section 5.6 (other than this
exception to such provisions) shall not be applicable to any other
consideration to be received or which may be deemed to be received by
the holders of the Common Shares (including the holders of Class B
Shares) pursuant to (i) the Spin Off or the Alternate Transaction (as
such terms are defined in the Merger Agreement), (ii) any of the
agreements contemplated by the Merger Agreement, including, without
limitation, the Consulting, Non-Compete and Termination Agreement
among SBI Holding Corporation, the Corporation and Robert F.X.
Sillerman and the Stockholder Agreement among SBI Holding Corporation,
SBI Acquisition Corporation, the Corporation and Robert F.X. Sillerman
or (iii) the employment agreements, as presently in force or as
amended or entered into from time to time, of Robert F.X.
Sillerman and Michael G. Ferrel.
Section 4(x) of the of the Corporation's Certificate of Designations,
Preferences and Relative, Participating, Optional and other Special Rights of
Preferred Stock and Qualifications, Limitations and Restrictions Thereof of
6 1/2% Series D Cumulative Convertible Exchangeable Preferred Stock Due May 31,
2007 as contained in the Corporation's Restated Certificate of Incorporation
shall be amended to read in its entirety as follows (underlined language is
new):
(x) The Corporation shall not pay any dividend or make any
distribution to, or on behalf of, the holders of any class or series
of Common Stock unless the holders of Class A Common Stock share
therein on an equal share for share basis, except that the holders of
Class A Common Stock shall receive shares of class A common stock of
SFX Live Entertainment, Inc. in the Spin Off (as defined in the
Agreement and Plan of Merger, dated as of August 24, 1997, as it may
be amended from time to time, among SBI Holding Corporation, SBI Radio
Acquisition Corporation and the Corporation) having rights, powers and
privileges similar to the Class A Common Stock, and the holders of
Class B Common Stock shall receive shares of class B common stock of
SFX Live Entertainment, Inc. in the Spin Off having rights, powers and
privileges similar to the Class B Common Stock.
The Corporation's Certificate of Designations, Preferences and
Relative, Participating, Optional and other Special Rights of Preferred Stock
and Qualifications, Limitations and Restrictions Thereof of 12 5/8% Series E
Cumulative Exchangeable Preferred Stock Due October 31,
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2006 as contained in the Corporation's Restated Certificate of Incorporation
shall be amended to read in the indicated sections as follows (except for the
section headings, underlined language is new; deletions are indicated by a
caret (^)):
1. Certain Definitions.
. . .
Acquisition Agreements. The term "Acquisition Agreements"
shall mean the acquisition agreements relating to the Pending
Acquisitions (as defined in the Consent Solicitation of the
Corporation dated January 7, 1998, as supplemented by Supplement No. 1
thereto dated January 28, 1998) as they may be amended from time to
time and all transactions and agreements specifically contemplated
thereby or by instruments referred to therein.
. . .
Class A Common Stock. The term "Class A Common Stock" shall
mean the Corporation's Class A Common Stock, par value $.01 per share.
Class B Common Stock. The term "Class B Common Stock" shall
mean the Corporation's Class B Common Stock, par value $.01 per share.
. . .
Consolidated Cash Flow. The term "Consolidated Cash Flow"
shall mean, with respect to any Person for any period, the
Consolidated Net Income of such Person for such period plus (i) an
amount equal to any extraordinary loss plus any net loss realized in
connection with an Asset Sale by such Person or any of its
Subsidiaries during such period (to the extent such losses were
deducted in computing such Consolidated Net Income), plus (ii)
provision for taxes based on income or profits of such Person and its
Subsidiaries for such period, to the extent that such provision for
taxes was included in computing such Consolidated Net Income, plus
(iii) Consolidated Interest Expense of such Person for such period, to
the extent any such Consolidated Interest Expense was deducted in
computing such Consolidated Net Income, plus (iv) depreciation,
amortization (including amortization of goodwill and other intangibles
but excluding amortization of prepaid cash expenses that were paid in
a prior period) and other non-cash charges (excluding any such
non-cash charge to the extent that it represents an accrual of or
reserve for cash charges in any future period) of such Person and its
Subsidiaries for such period to the extent that such depreciation,
amortization and other non-cash charges were deducted in computing
such Consolidated Net Income, plus (v) the Specified Charges (as
defined in the Corporation's Consent Solicitation Statement relating
to
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the Series E Preferred Stock dated January 7, 1998, as supplemented by
Supplement No. 1 thereto dated January 28, 1998, relating to the
Series E Preferred Stock), plus (vi) to the extent that such
Consolidated Net Income was reduced thereby (a) amortization of the
expenses incurred in connection with the Consulting, Non-Compete and
Termination Agreement among the Corporation, SBI Holding Corporation
and Robert F.X. Sillerman dated as of August 24, 1997, (b) consent
fees and expenses directly related to the Consent Solicitations, (c)
legal and other costs associated with pending or threatened litigation
in connection with the SBI Merger and (d) other unusual and
nonrecurring charges paid or accrued in 1997 or 1998 (including, but
not limited to, legal, accounting, investment banking, severance and
termination fees) relating to the SBI Merger, the Spin-Off, the
Pending Acquisitions or transactions related thereto less (vii) all
non-cash items increasing Consolidated Net Income for such period
(excluding any such non-cash income to the extent it represents an
accrual of cash income in any future period), in each case, on a
consolidated basis and determined in accordance with GAAP.
. . .
"Consent Solicitations" means the consent solicitations of
the Company made pursuant to the Consent Solicitation Statements dated
January 7, 1998, as supplemented by Supplement No. 1 thereto dated
January 28, 1998, to the holders of the Company's 10 3/4% Senior
Subordinated Notes due 2006 and to the holders of Series E Preferred
Stock and the related Information Statement.
. . .
Entertainment Companies. The term "Entertainment Companies"
shall mean SFX Entertainment and any and all of its direct and
indirect Subsidiaries.
. . .
Meadows Repurchase. The term "Meadows Repurchase" shall mean
the redemption by the Corporation of up to 250,838 shares of Class A
Common Stock for $33.00 per share, pursuant to the Agreement of
Merger, dated February 12, 1997, by and among the Corporation,
NOC-Acquisition Corp., CAPCO Acquisition Corp., QN Acquisition Corp.,
Nederlander of Connecticut, Inc., Connecticut Amphitheater Development
Corporation, QN Corp., Connecticut Performing Arts, Inc. and
Connecticut Performing Arts Partners and the Stockholders of
Nederlander of Connecticut, Inc., Connecticut Amphitheater Development
Corporation and QN Corp. listed on the signature page thereto.
Merger Agreement. The term "Merger Agreement" shall mean the
Agreement and Plan of Merger dated as of August 24, 1997, as it may be
amended from time to
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time, among the Corporation, SBI Holding Corporation and SBI Radio
Acquisition Corporation and all transactions and agreements
specifically contemplated thereby or by instruments referred to
therein.
. . .
SBI Merger. The term "SBI Merger" shall mean a merger of SBI
Radio Acquisition Corporation into the Corporation pursuant to the
Merger Agreement.
. . .
SFX Entertainment. The term "SFX Entertainment" shall mean
SFX Entertainment, Inc., a subsidiary of the Corporation, newly formed
in Delaware, to which the Corporation will contribute cash and all of
the capital stock of SFX Concerts, Inc. (formerly known as
Delsener/Slater Enterprises, Inc) that the Corporation directly or
indirectly owns.
. . .
Spin-Off. The term "Spin-Off" shall mean the distribution of
SFX Entertainment common stock pro rata to the holders of Class A
Common Stock and the Class B Common Stock (and the transfer to an
escrow account for delivery to the holders of certain warrants to
receive Class A Common Stock) or other disposition pursuant to, or as
permitted by, the Merger Agreement of all of the capital stock and
assets of the Entertainment Companies.
Spin-Off Transactions. The term "Spin-Off Transactions" shall
mean the Spin-Off, the Pending Acquisitions and the Merger Agreement
as it relates to the transactions described or referred to under the
"Proposed Amendments" and "Spin-Off" section of the Consent
Solicitation Statement of the Corporation dated January 7, 1998, as
supplemented by Supplement No. 1 thereto dated January 28, 1998,
relating to this Certificate of Designations.
Subsidiary. The term "Subsidiary" shall mean, with respect to
any person, (i) any corporation, association or other business entity
of which more than 50% of the total voting power of shares of Voting
Stock thereof is at the time owned or controlled, directly or
indirectly, by such person or one or more of the other Subsidiaries of
that person (or a combination thereof) and (ii) any partnership (a)
the sole general partner or the managing general partner of which is
such person or a Subsidiary of such person or (b) the only general
partners of which are such person or of one or more Subsidiaries of
such person (or any combination thereof); however, with respect to the
Corporation, "Subsidiary" does not include the Entertainment
Companies.
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. . .
8. Certain Covenants
(a) Restricted Payments. The Corporation shall not, and shall
not permit any of its Subsidiaries to, directly or indirectly: (i)
declare or pay any dividend or make any other payment or distribution
on account of the Corporation's Parity Securities or Junior Securities
(including, without limitation, any payment in connection with any
merger or consolidation involving the Corporation) or to the direct or
indirect holders of the Corporation's Parity Securities or Junior
Securities in their capacity as such (other than dividends or
distributions payable in Capital Stock (other than Disqualified Stock)
of the Corporation); (ii) purchase, redeem or otherwise acquire or
retire for value any Parity Securities or Junior Securities of the
Corporation; (iii) make any payment on, or purchase, redeem, defease
or otherwise acquire or retire for value any Junior Securities, except
payments of the Liquidation Preference thereof at final maturity; or
(iv) make any Restricted Investment (all such payments and other
actions set forth in clauses (i) through (iv) above being collectively
referred to as "Restricted Payments"), unless, at the time of and
after giving effect to such Restricted Payment:
(a) no Voting Rights Triggering Event shall have
occurred and be continuing or would occur as a consequence
thereof, and
(b) the Corporation would, at the time of such
Restricted Payment and after giving pro forma effect thereto
as if such Restricted Payment had been made at the beginning
of the applicable four-quarter period, have been permitted to
incur at least $1.00 of additional Indebtedness (other than
Permitted Debt) pursuant to the Debt to Cash Flow Ratio test
set forth below under Section 8(b) hereof; and
(c) such Restricted Payment, together with the
aggregate amount of all other Restricted Payments declared or
made after the Initial Issue Date (other than Restricted
Payments permitted by clauses (2), (5), (6) ^, (10), (13) or
(14) of the following paragraph) shall not exceed, at the
date of determination, the sum of (1) an amount equal to the
Corporation's Consolidated Cash Flow from the Initial Issue
Date to the end of the Corporation's most recently ended full
fiscal quarter for which internal financial statements are
available, taken as a single accounting period, less the
product of 1.4 times the Corporation's Consolidated Interest
Expense from the Initial Issue Date to the end of the
Corporation's most recently ended full fiscal quarter for
which internal financial statements are available, taken as a
single accounting period, plus (2) an amount equal to the net
cash proceeds received by the Corporation from the issue or
sale after the Initial
<PAGE>
Issue Date of Equity Interests of the Corporation (other than
(i) sales of Disqualified Stock and (ii) Equity Interests
sold to any of the Corporation's Subsidiaries) or of debt
securities or Disqualified Stock (other than the Series D
Preferred Stock) of the Corporation issued after the Initial
Issue Date that have been converted into such Equity
Interests plus (3) to the extent that any Restricted
Investment that was made after the Initial Issue Date is sold
for cash or otherwise liquidated or repaid for cash, the
lesser of (A) the cash return of capital with respect to such
Restricted Investment (less the cost of disposition, if any)
and (B) the initial amount of such Restricted Investment.
If no Voting Rights Triggering Event shall have occurred and
be continuing as a result thereof, the foregoing provisions will not
prohibit: (1) the payment of any dividend within 60 days after the
date of declaration thereof, if at said date of declaration such
payment would have complied with the provisions of this Certificate of
Designations; (2) the redemption, repurchase, retirement or other
acquisition of any Equity interests of the Corporation in exchange
for, or out of the proceeds of, the substantially concurrent sale
(other than to a Subsidiary of the Corporation) of other Equity
Interests of the Corporation (other than any Disqualified Stock);
provided that the amount of any such net cash proceeds that are
utilized for any such redemption, repurchase, retirement or other
acquisition shall be excluded from clause (c)(2) of the preceding
paragraph; (3) cash payments made in respect of fractional shares of
Capital Stock not to exceed $100,000 in the aggregate in any fiscal
year; (4) the payment of dividends on the shares of Series D Preferred
Stock in accordance with the terms thereof as in effect on the Initial
Issue Date; (5) the issuance of Series D Exchange Notes in exchange
for the Series D Preferred Stock; provided that such issuance is
permitted by Section 8(b) hereof; (6) the issuance of Exchange
Debentures in exchange for the Series E Preferred Stock; provided that
such issuance is permitted by Section 8(b) hereof; (7) in the event
that the Corporation elects to issue the Series D Exchange Notes in
exchange for the Series D Preferred Stock, cash payments made in lieu
of the issuance of Series D Exchange Notes having a face amount less
than $50 and any cash payments representing accrued and unpaid
dividends in respect thereof, not to exceed $100,000 in the aggregate
in any fiscal year; (8) in the event that the Corporation elects to
issue Exchange Debentures in exchange for Series E Preferred Stock,
cash payments made in lieu of the issuance of Exchange Debentures
having a face amount less than $1,000 and any cash payments
representing accrued and unpaid dividends in respect thereof, not to
exceed $100,000 in the aggregate in any fiscal year; (9) payments made
by the Corporation to SCMC for facilities maintenance and other
services and reimbursements pursuant to the Shared Facilities
Agreement, as amended from time to time, to the extent that such
payments do not exceed the amount of payments which would have been
due if calculated in accordance with the terms of the Shared
Facilities Agreement as in effect on the Initial Issue Date; (10)
payments by the Corporation pursuant to the Management Termination
Agreements in accordance with the terms thereof as in
<PAGE>
effect on the Initial Issue Date; (11) the redemption by the
Corporation of its Series C Preferred Stock in accordance with the
terms thereof as in effect on the Initial Issue Date; ^ (12) the
redemption by the Corporation of its Series B Preferred Stock in
accordance with the terms thereof as in effect on the Initial Issue
Date; provided that payments made by the Corporation to redeem the
Series B Preferred Stock shall not exceed $1.0 million in any fiscal
year or $2.0 million in the aggregate since the Initial Issue Date;
(13) the Spin-Off Transactions; and (14) the Meadows Repurchase.
The amount of all Restricted Payments (other than cash) shall
be the Fair Market Value (evidenced by a resolution of the Board of
Directors set forth in an Officers' Certificate delivered to the Board
of Directors) on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred by the Corporation or such
Subsidiary, as the case may be, pursuant to the Restricted Payment.
Not later than the date of making any Restricted Payment, the
Corporation shall deliver to the Board of Directors an Officers'
Certificate stating that such Restricted Payment is permitted and
setting forth the basis upon which the calculations required by this
covenant were computed, which calculations may be based upon the
Corporation's latest available financial statements.
. . .
(d) Transactions with Affiliates. The Corporation shall not,
and shall not permit any of its Subsidiaries to, make any payment to,
or sell, lease, transfer or otherwise dispose of any of its properties
or assets to, or purchase any property or assets from, or enter into
or make or amend any contract, agreement, understanding, loan, advance
or guarantee with, or for the benefit of, any Affiliate (each of the
foregoing, an "Affiliate Transaction"), unless (i) such Affiliate
Transaction is on terms that are no less favorable to the Corporation
or the relevant Subsidiary than those that would have been obtained in
a comparable transaction by the Corporation or such Subsidiary with an
unrelated Person and (ii) the Corporation delivers to the Holders (a)
with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$1.0 million, a resolution of the Board of Directors set forth in an
Officers' Certificate certifying that such Affiliate Transaction
complies with clause (i) above and that such Affiliate Transaction has
been approved by a majority of the members of the Board of Directors
that are disinterested as to such Affiliate Transaction and (b) with
respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $5.0
million, an opinion as to the fairness to the Holders of such
Affiliate Transaction from a financial point of view issued by an
accounting, appraisal or investment banking firm of national standing;
provided that (1) transactions between or among the Corporation and/or
its Wholly-Owned Subsidiaries, (2) the redemption or repurchase of the
Existing MMR Indebtedness, (3) transactions and agreements
specifically contemplated by the Termination and
<PAGE>
Assignment Agreement between the Corporation and SCMC as in effect on
the Initial Issue Date, (4) payments required by the terms of the
joint lease among the Corporation, SCMC and the landlord thereunder
for the Corporation's corporate headquarters located at 650 Madison
Avenue, New York, New York and any agreements directly related
thereto, in each case, as the same are in effect on the Initial Issue
Date, (5) payments made by the Corporation to SCMC for the facilities
maintenance and other services and reimbursements pursuant to the
Shared Facilities Agreement, (6) payments and other transactions by
the Corporation pursuant to the Management Termination Agreements, ^
(7) any Restricted Payments that are permitted by Section 8(a) hereof
and any Permitted Investments, (8) the transactions and agreements
specifically contemplated by the Merger Agreement, the Acquisition
Agreements or by instruments referred to in any such agreements and
(9) any Spin-Off Transaction, in each case, shall not be deemed to be
Affiliate Transactions.
. . .
(h) Waiver Relating to Certain Transactions. [DELETED IN ITS
ENTIRETY]
The Corporation reserves the right to make any changes to this Form of
Amendments as may be necessary to effectuate the purpose hereof.
<PAGE>
EXECUTION COPY
===============================================================================
SFX ENTERTAINMENT, INC.
9-1/8% SENIOR SUBORDINATED NOTES DUE 2008
------------------------------------
INDENTURE
Dated as of February 11, 1998
-------------------------------
-------------------------------
THE CHASE MANHATTAN BANK
-------------------------------
Trustee
===============================================================================
<PAGE>
CROSS-REFERENCE TABLE*
Trust Indenture Act Section Indenture Section
310 (a)(1)..........................................................7.10
(a)(2) .............................................................7.10
(a)(3) ............................................................N.A.
(a)(4)..............................................................N.A.
(a)(5)..............................................................7.10
(i)(b)..............................................................7.10
(ii)(c).............................................................N.A.
311(a)..............................................................7.11
(b) ...............................................................7.11
(iii)(c)............................................................N.A.
312 (a).............................................................2.05
(b) ...............................................................12.03
(iv)(c).............................................................12.03
313(a)..............................................................7.06
(b)(2)..............................................................7.07
(v)(c)..............................................................7.06; 12.02
(vi)(d).............................................................7.06
314(a)..............................................................4.03; 12.02
(c)(1)..............................................................12.04
(c)(2)..............................................................12.04
(c)(3)..............................................................N.A.
(vii)(e)............................................................11.05
(f) ..............................................................NA
315 (a).............................................................7.01
(b) ..............................................................7.05, 12.02
(A)(c)..............................................................7.01
(d) ..............................................................7.01
(e) ..............................................................6.11
316 (a)(last sentence)..............................................2.09
(a)(1)(A)...........................................................6.05
(a)(1)(B)...........................................................6.04
(a)(2)..............................................................N.A.
(b) ..............................................................6.07
(B)(c)..............................................................2.12
317 (a)(1)..........................................................6.08
(a)(2)..............................................................6.09
(b) ..............................................................2.04
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
<PAGE>
TABLE OF CONTENTS
-----------------
Page
----
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE........................1
Section 1.01. Definitions.............................................1
Section 1.02. Other Definitions......................................15
Section 1.03. Incorporation by Reference of Trust Indenture Act......16
Section 1.04. Rules of Construction..................................17
ARTICLE 2. THE NOTES........................................................17
Section 2.01. Form and Dating........................................17
Section 2.02. Execution and Authentication...........................18
Section 2.03. Registrar and Paying Agent.............................19
Section 2.04. Paying Agent to Hold Money in Trust....................19
Section 2.05. Holder Lists...........................................19
Section 2.06. Transfer and Exchange..................................20
Section 2.07. Replacement Notes......................................32
Section 2.08. Outstanding Notes......................................32
Section 2.09. Treasury Notes.........................................33
Section 2.10. Temporary Notes........................................33
Section 2.11. Cancellation...........................................33
Section 2.12. Defaulted Interest.....................................33
ARTICLE 3. REDEMPTION AND PREPAYMENT........................................34
Section 3.01. Notices to Trustee.....................................34
Section 3.02. Selection of Notes to Be Redeemed......................34
Section 3.03. Notice of Redemption...................................34
Section 3.04. Effect of Notice of Redemption.........................35
Section 3.06. Notes Redeemed in Part.................................36
Section 3.07. Optional Redemption....................................36
Section 3.08. Mandatory Redemption...................................36
Section 3.09. Offer to Purchase by Application of Excess Proceeds....37
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<PAGE>
ARTICLE 4. COVENANTS........................................................38
Section 4.01. Payment of Notes.......................................38
Section 4.02. Maintenance of Office or Agency........................39
Section 4.03. Reports................................................39
Section 4.04. Compliance Certificate.................................40
Section 4.05. Taxes..................................................40
Section 4.07. Restricted Payments....................................41
Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries.........................................43
Section 4.09. Incurrence of Indebtedness and Issuance of
Preferred Stock......................................44
Section 4.10. Asset Sales............................................45
Section 4.11. Transactions with Affiliates...........................47
Section 4.12. Liens..................................................47
Section 4.14. Corporate Existence....................................48
Section 4.15. Offer to Repurchase Upon Change of Control.............48
Section 4.16. No Senior Subordinated Debt............................49
Section 4.17. Issuances and Sales of Equity Interests in
Restricted Subsidiaries..............................49
Section 4.18. Limitation on Sale and Leaseback Transactions..........49
Section 4.19. Payments for Consent...................................50
Section 4.20. Additional Subsidiary Guarantees.......................50
ARTICLE 5. SUCCESSORS.......................................................50
Section 5.01. Merger, Consolidation, or Sale of Assets...............50
Section 5.02. Successor Corporation Substituted......................51
ARTICLE 6. DEFAULTS AND REMEDIES............................................51
Section 6.01. Events of Default......................................51
Section 6.02. Acceleration...........................................53
Section 6.03. Other Remedies.........................................54
Section 6.04. Waiver of Past Defaults................................54
Section 6.05. Control by Majority....................................54
Section 6.07. Rights of Holders of Notes to Receive Payment..........55
Section 6.08. Collection Suit by Trustee.............................55
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<PAGE>
Section 6.09. Trustee May File Proofs of Claim.......................55
Section 6.10. Priorities.............................................56
Section 6.11. Undertaking for Costs..................................56
Section 6.12. No Personal Liability of Directors, Officers,
Employees and Stockholders...........................56
ARTICLE 7. TRUSTEE..........................................................56
Section 7.01. Duties of Trustee......................................56
Section 7.02. Rights of Trustee......................................57
Section 7.03. Individual Rights of Trustee...........................58
Section 7.04. Trustee's Disclaimer...................................58
Section 7.05. Notice of Defaults.....................................58
Section 7.06. Reports by Trustee to Holders of the Notes.............59
Section 7.07. Compensation and Indemnity.............................59
Section 7.08. Replacement of Trustee.................................60
Section 7.09. Successor Trustee by Merger, etc.......................61
Section 7.10. Eligibility; Disqualification..........................61
Section 7.11. Preferential Collection of Claims Against Company......61
ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE.........................61
Section 8.01. Option to Effect Legal Defeasance or Covenant
Defeasance...........................................61
Section 8.02. Legal Defeasance and Discharge.........................61
Section 8.03. Covenant Defeasance....................................62
Section 8.04. Conditions to Legal or Covenant Defeasance.............62
Section 8.05. Deposited Money and Government Securities to be
Held in Trust; Other Miscellaneous Provisions........63
Section 8.06. Repayment to Company...................................64
Section 8.07. Reinstatement..........................................64
ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER.................................65
Section 9.01. Without Consent of Holders of Notes....................65
Section 9.02. With Consent of Holders of Notes.......................65
Section 9.03. Compliance with Trust Indenture Act....................67
Section 9.04. Revocation and Effect of Consents......................67
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<PAGE>
Section 9.05. Notation on or Exchange of Notes.......................67
Section 9.06. Trustee to Sign Amendments, etc........................67
ARTICLE 10. SUBORDINATION...................................................68
Section 10.01. Agreement to Subordinate................................68
Section 10.02. Certain Definitions.....................................68
Section 10.03. Liquidation; Dissolution; Bankruptcy....................68
Section 10.04. Default on Designated Senior Debt.......................69
Section 10.05. Acceleration of Securities..............................70
Section 10.06. When Distribution Must Be Paid Over.....................70
Section 10.07. Notice by Company.......................................70
Section 10.08. Subrogation.............................................70
Section 10.09. Relative Rights.........................................71
Section 10.10. Subordination May Not Be Impaired by Company............71
Section 10.11. Distribution or Notice to Representative................71
Section 10.12. Rights of Trustee and Paying Agent......................71
Section 10.13. Authorization to Effect Subordination...................72
Section 10.14. Amendments..............................................72
ARTICLE 11. SUBSIDIARY GUARANTEES...........................................72
Section 11.01. Guarantee...............................................72
Section 11.02. Subordination of Subsidiary Guarantee...................73
Section 11.03. Limitation on Guarantor Liability.......................73
Section 11.04. Execution and Delivery of Note Guarantee................73
Section 11.05. Guarantors May Consolidate, etc., on Certain Terms......74
Section 11.06. Releases Following Sale of Assets.......................75
ARTICLE 12. MISCELLANEOUS...................................................75
Section 12.01. Trust Indenture Act Controls............................75
Section 12.02. Notices.................................................75
Section 12.03. Communication by Holders of Notes with Other
Holders of Notes......................................77
Section 12.04. Certificate and Opinion as to Conditions Precedent......77
- iv -
<PAGE>
Section 12.05. Statements Required in Certificate or Opinion...........77
Section 12.06. Rules by Trustee and Agents.............................77
Section 12.07. No Personal Liability of Directors, Officers,
Employees and Stockholders............................77
Section 12.08. Governing Law...........................................78
Section 12.09. No Adverse Interpretation of Other Agreements...........78
Section 12.10. Successors..............................................78
Section 12.11. Severability............................................78
Section 12.12. Counterpart Originals...................................78
Section 12.13. Table of Contents, Headings, etc........................78
EXHIBITS
Exhibit A1 FORM OF NOTE
Exhibit A2 FORM OF REGULATION S TEMPORARY GLOBAL NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED
INVESTOR
Exhibit E FORM OF SUBSIDIARY GUARANTEE
Exhibit F FORM OF SUPPLEMENTAL INDENTURE
SCHEDULES
Schedule I Schedule of Guarantors
- v -
<PAGE>
INDENTURE dated as of February 11, 1998 among SFX Entertainment, Inc.,
a Delaware corporation (the "Company"), Atlanta Concerts, Inc., Ardee Festivals
N.J., Inc., Ardee Productions, Ltd., Beach Concerts, Inc., BGP Acquisition,
LLC, Broadway Concerts, Inc., Connecticut Amphitheater Development Corp.,
Connecticut Concerts, Incorporated, Connecticut Performing Arts, Inc.,
Connecticut Performing Arts Partners, Conn Ticketing Company, Contemporary
Group Acquisition Corp., Deer Creek Amphitheater Concerts, Inc., Deer Creek
Amphitheater Concerts, LP, Delsener/Slater Enterprises, Ltd., Dumb Deal, Inc.,
Exit 116 Revisited, Inc., FPI Concerts, Inc., In House Tickets, Inc., Irving
Plaza Concerts, Inc., Murat Center Concerts, Inc., Murat Center Concerts, LP,
NOC, Inc., Northeast Ticketing Company, Polaris Amphitheater Concerts, Inc., QN
Corp., SFX Broadcasting of the Midwest, Inc., SFX Concerts, Inc., SFX Network
Group, LLC, Southeast Ticketing Company, Sunshine Concerts, LLC, Sunshine
Designs, Inc., Sunshine Designs, LP, Suntex Acquisition, Inc., Suntex
Acquisition, LP, Westbury Music Fair, LLC (collectively, the "Guarantors") and
The Chase Manhattan Bank, as trustee (the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders of
the 9-1/8% Series A Senior Subordinated Notes due 2008 (the "Series A Notes")
and the 9-1/8% Series B Senior Subordinated Notes due 2008 (the "Series B
Notes" and, together with the Series A Notes, the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"144A Global Note" means a global note in the form of Exhibit A1
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of, and registered in the name of, the Depositary
or its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall
mean the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the Voting Stock of a Person shall be
deemed to be control.
"Acquired Businesses" means each of the businesses to be acquired by
the Company pursuant to the Pending Acquisitions.
"Agent" means any Registrar, Paying Agent or co-registrar.
<PAGE>
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Cedel that apply to such transfer
or exchange.
"Asset Sale" means (i) the sale, lease, conveyance or other
disposition of any assets or rights (including, without limitation, by way of a
sale and leaseback), excluding sales of services and ancillary products in the
ordinary course of business consistent with past practices (provided that the
sale, lease, conveyance or other disposition of all or substantially all of the
assets of the Company and its Restricted Subsidiaries taken as a whole will be
governed by the provisions of Section 4.15 hereof and/or the provisions of
Section 5.01 hereof and not by the provisions of Section 4.10 hereof) and (ii)
the issue or sale by the Company or any of its Subsidiaries of Equity Interests
of any of the Company's Subsidiaries, in the case of either clause (i) or (ii),
whether in a single transaction or a series of related transactions (a) that
have a fair market value in excess of $5.0 million or (b) for net proceeds in
excess of $5.0 million. Notwithstanding the foregoing: (i) a transfer of assets
by the Company to a Wholly Owned Restricted Subsidiary or by a Wholly Owned
Restricted Subsidiary to the Company or to another Wholly Owned Restricted
Subsidiary, (ii) an issuance of Equity Interests by a Wholly Owned Restricted
Subsidiary to the Company or to another Wholly Owned Restricted Subsidiary,
(iii) the transfer of obsolete equipment in the ordinary course of business,
(iv) the sale and leaseback of any assets within 90 days of the acquisition of
such assets and (v) a Restricted Payment that is permitted by Section 4.07
hereof will not be deemed to be Asset Sales.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value (discounted at the rate
of interest implicit in such transaction, determined in accordance with GAAP)
of the obligation of the lessee for net rental payments during the remaining
term of the lease included in such sale and leaseback transaction (including
any period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company, or
any authorized committee of the Board of Directors.
"Broadcasting" means SFX Broadcasting, Inc., a Delaware corporation.
"Broadcasting Buyer" means SBI Holding Co.
"Broadcasting Merger" means the merger of SBI Radio Acquisition
Corporation with and into SFX Broadcasting, Inc., pursuant to which
Broadcasting will become a subsidiary of SBI Holding Co.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital
lease that would at such time be required to be capitalized on a balance sheet
in accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership or limited
liability company, partnership or
- 2 -
<PAGE>
membership interests (whether general or limited) and (iv) any other interest
or participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more than six months from the date of acquisition, (iii) certificates of
deposit and eurodollar time deposits with maturities of six months or less from
the date of acquisition, bankers' acceptances with maturities not exceeding six
months and overnight bank deposits, in each case with any domestic commercial
bank having capital and surplus in excess of $500.0 million and a Thompson Bank
Watch Rating of "B" or better, (iv) repurchase obligations with a term of not
more than seven days for underlying securities of the types described in
clauses (ii) and (iii) above entered into with any financial institution
meeting the qualifications specified in clause (iii) above and (v) commercial
paper having the highest rating obtainable from Moody's Investors Service, Inc.
or Standard & Poor's Corporation and in each case maturing within six months
after the date of acquisition and (vi) money market funds at least 95% of the
assets of which constitute Cash Equivalents of the kinds described in clauses
(i) - (v) of this definition.
"Cedel" means Cedel Bank, SA.
"Change of Control" means the occurrence of any of the following: (i)
the sale, lease, transfer, conveyance or other disposition (other than the
Spin-Off or by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company and its
Subsidiaries taken as a whole to any "person" (as such term is used in Section
13(d)(3) of the Exchange Act) other than the Principal or a Related Party of
the Principal, (ii) the adoption of a plan relating to the liquidation or
dissolution of the Company, (iii) the consummation of any transaction
(including, without limitation, any merger or consolidation) the result of
which is that any "person" (as defined above), other than the Principal and his
Related Parties, becomes the "beneficial owner" (as such term is defined in
Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that a person shall be
deemed to have "beneficial ownership" of all securities that such person has
the right to acquire, whether such right is currently exercisable or is
exercisable only upon the occurrence of a subsequent condition), directly or
indirectly, of Voting Stock of the Company having more than 35% of the combined
voting power of all classes of Voting Stock of the Company then outstanding or
(iv) the first day on which a majority of the members of the Board of Directors
of the Company are not Continuing Directors.
"Company" means SFX Entertainment, Inc., a Delaware corporation, and
any and all successors thereto.
"Compensation Committee" means a committee of at least two members of
the board of directors of the Company, a majority of whom are (i) independent
directors elected by the holders of Class A Common Stock of the Company and
(ii) not interested in the particular transactions being approved.
"Consolidated Cash Flow" means, with respect to any Person
for any period, the Consolidated Net Income of such Person for such period
plus, without duplication, (i) an amount equal to any extraordinary loss plus
any net loss realized in connection with an Asset Sale, to the extent such
losses were deducted in computing such Consolidated Net Income, plus (ii)
provision for taxes based on income or profits of such Person and its
Restricted Subsidiaries for such period, to the extent that such provision for
taxes was deducted in computing such Consolidated Net Income, plus (iii)
consolidated interest expense of such Person and its Restricted Subsidiaries
for such period, whether paid or accrued and whether or not capitalized
(including, without limitation, amortization of debt issuance costs and
original issue discount, non-cash interest payments,
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<PAGE>
the interest component of any deferred payment obligations, the interest
component of all payments associated with Capital Lease Obligations, imputed
interest with respect to Attributable Debt, commissions, discounts and other
fees and charges incurred in respect of letter of credit or bankers' acceptance
financings, and net payments (if any) pursuant to Hedging Obligations), to the
extent that any such expense was deducted in computing such Consolidated Net
Income, plus (iv) depreciation expense for such period, to the extent the same
was deducted in computing such Consolidated Net Income, plus (v) all
amortization expense and other non-cash expenses (excluding any such non-cash
expense to the extent that it represents an accrual of or reserve for cash
expenses in any future period) for such period, to the extent the same was
deducted in computing such Consolidated Net Income, plus (vi) unusual and
nonrecurring charges paid or accrued in 1997 or 1998 (including, but not
limited to, legal, accounting, investment banking, severance, termination,
non-compete and consent fees) relating to the Merger Agreement, the Spin-Off,
the Pending Acquisitions and transactions related thereto, minus (vii) non-cash
items increasing such Consolidated Net Income for such period, minus (viii)
except to the extent already deducted in computing Consolidated Net Income for
such period, preproduction expenses and investments in theatrical productions
incurred or made during such period by the Company or any Restricted Subsidiary
as set forth in the Company's Consolidated Statement of Cash Flows, plus (ix)
any cash return of capital paid to the Company or a Restricted Subsidiary
during such period associated with a preproduction expense or investment in
theatrical productions to the extent the same was deducted pursuant to clause
(viii) above in computing Consolidated Cash Flow for such period or a prior
period, in each case, on a consolidated basis and determined in accordance with
GAAP.
"Consolidated Indebtedness" means, with respect to any Person as of
any date of determination, the sum, without duplication, of (i) the total
amount of Indebtedness and Attributable Debt of such Person and its Restricted
Subsidiaries, plus (ii) the total amount of Indebtedness and Attributable Debt
of any other Person, to the extent that such Indebtedness or Attributable Debt
has been guaranteed by the referent Person or by one or more of its Restricted
Subsidiaries or is secured by a Lien on assets of the referent Person or any of
its Restricted Subsidiaries, plus (iii) the aggregate liquidation value of all
Disqualified Stock of such Person and all preferred stock of Restricted
Subsidiaries of such Person, in each case, determined on a consolidated basis
in accordance with GAAP.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that (i) the Net Income (but not loss) of any Person that
is not a Restricted Subsidiary or that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends or
distributions paid in cash to the referent Person or a Restricted Subsidiary
thereof, (ii) the Net Income of any Restricted Subsidiary shall be excluded to
the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that Net Income is not at the
date of determination permitted without any prior governmental approval (that
has not been obtained) or, directly or indirectly, by operation of the terms of
its charter or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulation applicable to that Restricted Subsidiary or its
stockholders, (iii) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition
shall be excluded, (iv) the cumulative effect of a change in accounting
principles shall be excluded and (v) the Net Income (but not loss) of any
Unrestricted Subsidiary shall be excluded, whether or not distributed to the
Company or one of its Restricted Subsidiaries.
"Contemporary Agreement" means the agreement by the Company to acquire
The Contemporary Group, dated as of December 12, 1997, and the agreements
related thereto, each as in effect on the date hereof.
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"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date hereof or (ii) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 12.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Credit Facility" or "Credit Facilities" means one or more debt
facilities (including, without limitation, the Senior Credit Facility) or
commercial paper facilities with banks or other institutional lenders providing
for revolving credit loans, term loans, receivables financing (including
through the sale of receivables to such lenders or to special purpose entities
formed to borrow from such lenders against such receivables) or letters of
credit, in each case, as amended, restated, modified, renewed, refunded,
replaced or refinanced in whole or in part from time to time. Indebtedness
under Credit Facilities outstanding on the date on which Notes are first issued
and authenticated under this Indenture shall be deemed to have been incurred on
such date in reliance on the exception provided by clause (i) of the definition
of Permitted Debt.
"Custodian" means the Trustee, as custodian with respect to the Notes
in global form, or any successor entity thereto.
"Debt to Cash Flow Ratio" means, with respect to any Person as of any
date of determination (the "Calculation Date"), the ratio of (a) the
Consolidated Indebtedness of such Person as of such date to (b) the
Consolidated Cash Flow of such Person for the four most recent full fiscal
quarters ending immediately prior to such date for which internal financial
statements are available, determined on a pro forma basis after giving effect
to all acquisitions and dispositions of assets made by such Person and its
Restricted Subsidiaries from the beginning of such four-quarter period through
and including such date of determination (including any related financing
transactions) as if such acquisitions and dispositions had occurred at the
beginning of such four-quarter period. For purposes of making the computation
referred to above, (i) acquisitions that have been made by such Person or any
of its Restricted Subsidiaries, including through mergers or consolidations and
including any related financing transactions, during the four-quarter reference
period or subsequent to such reference period and on or prior to the
Calculation Date shall be deemed to have occurred on the first day of the
four-quarter reference period and Consolidated Cash Flow for such reference
period shall be calculated without giving effect to clause (iii) of the proviso
set forth in the definition of Consolidated Net Income and (ii) the
Consolidated Cash Flow attributable to discontinued operations, as determined
in accordance with GAAP, and operations or businesses disposed of by the
Company or any of its Restricted Subsidiaries prior to the Calculation Date,
shall be excluded.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06 hereof, in the
form of Exhibit A1 hereto except that such Note shall not bear the Global Note
Legend and shall not have the "Schedule of Exchanges of Interests in the Global
Note" attached thereto.
"Delsener/Slater Employment Agreements" means (i) the employment
agreement dated January 2, 1997, among Broadcasting, Delsener/Slater
Enterprises, Inc. and Mitch Slater and (ii) the
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employment agreement dated January 2, 1997 among Broadcasting, Delsener/Slater
Enterprises, Inc. and Ron Delsener, in each case as in effect on the date
hereof.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable at the option of the holder thereof), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the date that is 91 days after the date on
which the Notes mature, provided, however, that any Capital Stock that would
constitute Disqualified Stock solely because the holders thereof have the right
to require the Company to repurchase such Capital Stock upon the occurrence of
a Change of Control or an Asset Sale shall not constitute Disqualified Stock if
the terms of such Capital Stock provide that the Company may not repurchase or
redeem any such Capital Stock pursuant to such provisions unless such
repurchase or redemption complies with Section 4.07 hereof.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the Notes issued in the Exchange Offer pursuant
to Section 2.06(f) hereof.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Existing Indebtedness" means Indebtedness in existence on the date
hereof (other than Indebtedness under Credit Facilities), until such
Indebtedness is repaid.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect from time to time.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes, in the form of
Exhibits A1 and A2 hereto issued in accordance with Section 2.01, 2.06(b)(iv),
2.06(d)(ii) or 2.06(f) hereof.
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"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, by way of a pledge of
assets or through letters of credit and reimbursement agreements in respect
thereof), of all or any part of any Indebtedness.
"Guarantor" means each of the Company's current and future domestic
Restricted Subsidiaries that executes a Subsidiary Guarantee in accordance with
the provisions of this Indenture, and its respective successors and assigns.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means the global Note in the form of Exhibit A-1
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold to Institutional Accredited Investors.
"Indebtedness" means, with respect to any Person, without duplication,
(i) any indebtedness of such Person, whether or not contingent, in respect of
borrowed money or evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof) or
banker's acceptances or representing Capital Lease Obligations or the balance
deferred and unpaid of the purchase price of any property or representing any
Hedging Obligations, except any such balance that constitutes an accrued
expense or trade payable, if and to the extent any of the foregoing
indebtedness (other than letters of credit and Hedging Obligations) would
appear as a liability upon a balance sheet of such Person prepared in
accordance with GAAP, (ii) all indebtedness of others secured by a Lien on any
asset of such Person (whether or not such indebtedness is assumed by such
Person) and (iii) to the extent not otherwise included, the guarantee by such
Person of any indebtedness of any other Person. The amount of any Indebtedness
outstanding as of any date shall be (i) the accreted value thereof, in the case
of any Indebtedness issued with original issue discount, and (ii) the principal
amount thereof, together with any interest thereon that is more than 30 days
past due, in the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
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"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business),
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
If the Company or any Subsidiary of the Company sells or otherwise disposes of
any Equity Interests of any direct or indirect Subsidiary of the Company such
that, after giving effect to any such sale or disposition, such Person is no
longer a Subsidiary of the Company, the Company shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the fair market
value of the Equity Interests of such Subsidiary not sold or disposed of in an
amount determined as provided in the third paragraph of Section 4.07 hereof.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
on such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be prepared
by the Company and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease
in the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement
under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
"Liquidated Damages" means all liquidated damages then owing pursuant
to Section 5 of the Registration Rights Agreement.
"Meadows Repurchase" means the transfer by Broadcasting to the Company
of an option to repurchase, and the purchase by the Company, of up to 250,838
shares of Class A Common Stock of Broadcasting for $33.00 per share, pursuant
to an option granted in connection with the Agreement of Merger, dated February
12, 1997, by and among Broadcasting, NOC Acquisition Corp., CAPCO Acquisition
Corp., QN Acquisition Corp., Nederlander of Connecticut, Inc., Connecticut
Amphitheater Development Corporation, QN Corp., Connecticut Performing Arts.
Inc. and Connecticut Performing Arts Partners and the stockholders of
Nederlander of Connecticut, Inc., Connecticut Amphitheater Development
Corporation and QN Corp. listed on the signature pages thereto and the transfer
of such stock to Broadcasting prior to the Broadcasting Merger.
"Merger Agreement" means the Agreement and Plan of Merger dated as of
August 24, 1997, that provides for the Broadcasting Merger and all transactions
and agreements specifically contemplated thereby or by instruments referred to
therein, each as in effect on the date hereof.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (i) any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized in connection with (a) any Asset Sale (including, without
limitation, dispositions pursuant to sale and leaseback transactions) or (b)
the disposition of any securities by such Person or any of its
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Restricted Subsidiaries or the extinguishment of any Indebtedness of such
Person or any of its Restricted Subsidiaries and (ii) any extraordinary gain
(but not loss), together with any related provision for taxes on such
extraordinary gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
the direct costs relating to such Asset Sale (including, without limitation,
legal, accounting and investment banking fees, and sales commissions) and any
relocation expenses incurred as a result thereof, taxes paid or payable as a
result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements), amounts required to be applied to
the repayment of Indebtedness secured by a Lien on the asset or assets that
were the subject of such Asset Sale and any reserve for adjustment in respect
of the sale price of such asset or assets established in accordance with GAAP.
"Non-Guarantor Subsidiaries" means Walnut Creek Amphitheater
Partnership and Coral Sky Amphitheater Partnership.
"Non-Recourse Debt" means Indebtedness: (i) as to which neither the
Company nor any of its Restricted Subsidiaries (a) provides credit support of
any kind (including any undertaking, agreement or instrument that would
constitute Indebtedness), (b) is directly or indirectly liable (as a guarantor
or otherwise) or (c) constitutes the lender; (ii) no default with respect to
which (including any rights that the holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness (other than
the Notes being offered hereby) of the Company or any of its Restricted
Subsidiaries to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its stated maturity; and
(iii) as to which the lenders have been notified in writing that they will not
have any recourse to the stock or assets of the Company or any of its
Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Notes" has the meaning assigned to it in the preamble to this
Indenture.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering" means the offering of the Notes by the Company.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, the treasurer, the
controller or the principal accounting officer of the Company, that meets the
requirements of Section 12.05 hereof.
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"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
12.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Pace Agreement" means the agreement by the Company to acquire PACE
Entertainment Corporation (including the Agreements relating to the Sony
Acquisition and the Blockbuster Acquisition to acquire a 100% interest in
Pavilion Partners), dated December 12, 1997 and the agreements related thereto,
each as in effect on the date hereof.
"Pace Acquisition Facility" means the agreement by the Company,
pursuant to the Pace Agreement, to provide to PACE Entertainment Corporation up
to an aggregate of $25.0 million to be used to fund certain acquisitions, as in
effect on the date hereof.
"Participant" means, with respect to the Depositary, Euroclear or
Cedel, a Person who has an account with the Depositary, Euroclear or Cedel,
respectively (and, with respect to The Depository Trust Company, shall include
Euroclear and Cedel).
"Participating Broker-Dealer" has the meaning set forth in the
Registration Rights Agreement.
"Pending Acquisitions" means the acquisition by the Company of (i)
PACE Entertainment Corporation, pursuant to the Pace Agreement, (ii) The
Contemporary Group, pursuant to the Contemporary Agreement, (iii) BG Presents,
pursuant to an agreement dated December 11, 1997, (iv) The Network Magazine
Group and SJS Entertainment, each pursuant to an agreement dated December 10,
1997, and (v) Concert/Southern Promotions, pursuant to an agreement dated
December 15, 1997, in each case as in effect on the date hereof and including
the transactions and agreements specifically related thereto.
"Permitted Business" means the live entertainment business and any
business reasonably similar, complementary, ancillary or related thereto,
including the Pending Acquisitions.
"Permitted Investments" means (i) any Investment in the Company or in
a Guarantor; (ii) any Investment in Cash Equivalents; (iii) any Investment by
the Company or any Restricted Subsidiary of the Company in a Person engaged in
a Permitted Business, if (a) as a result of, or concurrently with, such
Investment such Person becomes a Guarantor or (b) as a result of, or
concurrently with, such Investment such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, the Company or a Guarantor; or (c) the
Company or a Guarantor has entered into a binding agreement to acquire such
Person or all or substantially all of the assets of such Person, which
agreement is in effect on the date of such Investment, and such Person becomes
a Guarantor or such transaction is consummated, in each case within 180 days of
the date of such Investment; (iv) any Restricted Investment made as a result of
the receipt of non-cash consideration from an Asset Sale that was made pursuant
to and in compliance with Section 4.10 hereof; (v) any obligations or shares of
Capital Stock received in connection with or as a result of a bankruptcy,
workout or reorganization of the issuer of such obligations or shares of
Capital Stock; (vi) any Investment received involuntarily; (vii) any
acquisition of assets solely in exchange for the issuance of Equity Interests
(other than Disqualified Stock) of the Company; (viii) any Investment made
under the Pace Acquisition Facility pursuant to the Pace Agreement as in effect
on the date hereof; (ix) Investments owned by any of the Acquired Businesses as
of the date such Acquired Business is acquired; (x) other Investments in
Persons engaged in Permitted Businesses (measured on the date each such
Investment was made and without giving effect to subsequent changes in value),
when taken together with all
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other Investments made pursuant to this clause (x) that are at the time
outstanding, not to exceed 5% of Total Tangible Assets; (xi) the consummation
of the Pending Acquisitions; (xii) the Meadows Repurchase and the Series E
Preferred Repurchase; provided that the Company receives either (x) a cash
payment from Broadcasting or Broadcasting Buyer or an Affiliate thereof at or
prior to the date of the Broadcasting Merger at least equal to the aggregate
amount expended by the Company in the Meadows Repurchase and the Series E
Preferred Repurchase less $3.0 million or (y) an increase in favor of the
Company in the Working Capital Adjustment (including the avoidance of a
decrease) contemplated by the Merger Agreement in an amount at least equal to
the aggregate amount expended by the Company in the Meadows Repurchase and the
Series E Preferred Repurchase less $3.0 million or (z) any combination thereof
adding up to an amount at least equal to the aggregate amount expended by the
Company in the Meadows Repurchase and the Series E Preferred Repurchase less
$3.0 million; and (xiii) other Investments in any Person (measured on the date
each such Investment was made and without giving effect to subsequent changes
in value), when taken together with all other Investments made pursuant to this
clause (xiii) that are at the time outstanding, not to exceed $4.0 million.
"Permitted Liens" means (i) Liens securing Senior Debt that was
permitted by the terms hereof to be incurred; (ii) Liens in favor of the
Company or any of its Restricted Subsidiaries; (iii) Liens on property of a
Person existing at the time such Person is merged into or consolidated with the
Company or any Restricted Subsidiary of the Company; provided that such Liens
were not incurred in contemplation of such merger or consolidation and do not
extend to any assets other than those of the Person merged into or consolidated
with the Company; (iv) Liens on property existing at the time of acquisition
thereof by the Company or any Restricted Subsidiary of the Company, provided
that such Liens were in existence prior to the contemplation of such
acquisition; (v) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of a like nature
incurred in the ordinary course of business; (vi) Liens existing on the date
hereof; (vii) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded, provided
that any reserve or other appropriate provision as shall be required in
conformity with GAAP shall have been made therefore; and (viii) Liens incurred
in the ordinary course of business of the Company or any Restricted Subsidiary
of the Company with respect to obligations that do not exceed $2.0 million at
any one time outstanding.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries or any Disqualified Stock of the
Company issued in exchange for, or the net proceeds of which are used to
extend, refinance, renew, replace, defease or refund other Indebtedness of the
Company or any of its Restricted Subsidiaries; provided that: (i) the principal
amount (or accreted value or liquidation preference, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount of (or
accreted value, if applicable), plus accrued interest on, the Indebtedness so
extended, refinanced, renewed, replaced, defeased or refunded (plus the amount
of reasonable expenses incurred in connection therewith); (ii) such Permitted
Refinancing Indebtedness has a final maturity date later than the final
maturity date of, and has a Weighted Average Life to Maturity equal to or
greater than the Weighted Average Life to Maturity of, the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; (iii) if the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded is pari passu with the Notes, such Permitted Refinancing Indebtedness
is pari passu with or subordinated in right of payment to the Notes or is
Disqualified Stock; (iv) if the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded is subordinated in right of payment to
the Notes, such Permitted Refinancing Indebtedness is subordinated in right of
payment to the Notes on terms at least as favorable to the Holders of Notes as
those contained in the documentation governing the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded or is Disqualified Stock;
and (v) such Indebtedness is incurred either
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by the Company or by the Restricted Subsidiary that is the obligor on the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded, or such Disqualified Stock is issued by the Company, as applicable.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization
or government or agency or political subdivision thereof (including any
subdivision or ongoing business of any such entity or substantially all of the
assets of any such entity, subdivision or business).
"Principal" means Robert F.X. Sillerman.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of February 11, 1998, by and among the Company and the
other parties named on the signature pages thereof, as such agreement may be
amended, modified or supplemented from time to time.
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Regulation S Global Note" means a global Note bearing the Private
Placement Legend and deposited with or on behalf of the Depositary and
registered in the name of the Depositary or its nominee, issued in a
denomination equal to the outstanding principal amount of the Notes initially
sold in reliance on Rule 903 of Regulation S.
"Regulation S Permanent Global Note" means a permanent global Note in
the form of Exhibit A1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary global Note in
the form of Exhibit A2 hereto bearing the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee, issued in a denomination equal to the outstanding principal amount
of the Notes initially sold in reliance on Rule 903 of Regulation S.
"Related Party" with respect to the Principal means (i) any spouse or
immediate family member of the Principal or (ii) any trust, corporation,
partnership or other entity, the beneficiaries, stockholders, partners, owners
or Persons beneficially holding an 80% or more controlling interest of which
consist of the Principal and/or such other Persons referred to in the
immediately preceding clause (i).
"Responsible Officer," when used with respect to the Trustee, means
any officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
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"Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day restricted period as defined in
Regulation S.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Credit Facility" collectively means that certain credit and
guarantee agreement to be entered into by and among the Company, the
Guarantors, the lenders party thereto, The Bank of New York, as Administrative
Agent, Lehman Commercial Paper Inc. and Goldman Sachs Credit Partners L.P.,
each as Co-Documentation Agents, and each other Loan Document as defined in
such credit and guarantee agreement, as contemplated by that certain commitment
letter by and among the Company, The Bank of New York, BNY Capital Markets,
Inc., Lehman Commercial Paper Inc. and Goldman Sachs Credit Partners L.P., each
as amended, restated, modified, renewed, refunded, replaced or refinanced in
whole or in part from time to time.
"Series E Preferred Repurchase" means the purchase by the Company of
up to $14.2 million in liquidation preference of 12-5/8% Series E Cumulative
Exchangeable Preferred Stock due October 31, 2006 of Broadcasting and the
dividend or other transfer of such stock to Broadcasting prior to the
Broadcasting Merger.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in the Registration Rights Agreement.
"Significant Subsidiary" means any Restricted Subsidiary that would be
a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation
S-X, promulgated pursuant to the Securities Act, as such Regulation is in
effect on the date hereof.
"Spin-Off" means the distribution of the common stock of the Company
pro rata to the holders of SFX Broadcasting, Inc. or other disposition pursuant
to, or as permitted by, the Merger Agreement of all the capital stock and
assets of the Company and its Subsidiaries.
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"Spin-Off Transaction" means the Spin-Off, the Merger Agreement and
related transactions described or referred to in the Offering Memorandum of the
Company dated February 5, 1998.
"Stated Maturity" means, with respect to any installment of interest
or principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations
to repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a
combination thereof).
"Subsidiary Guarantee" means the Guarantee by each Guarantor of the
Company's payment obligations under this Indenture and the Notes, executed
pursuant to the provisions of this Indenture.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA.
"Total Tangible Assets" means, as of any date, (i) the total
consolidated assets of the Company and its Restricted Subsidiaries, as set
forth on the Company's most recently available internal consolidated balance
sheet, minus (ii) the total consolidated intangible assets of the Company and
its Restricted Subsidiaries, as set forth on such consolidated balance sheet.
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"Unrestricted Global Note" means a permanent global Note in the form
of Exhibit A1 attached hereto that bears the Global Note Legend and that has
the "Schedule of Exchanges of Interests in the Global Note" attached thereto,
and that is deposited with or on behalf of and registered in the name of the
Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Definitive Note" means one or more Definitive Notes that
do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Subsidiary" means (i) any Subsidiary that is designated
by the Board of Directors as an Unrestricted Subsidiary pursuant to a
resolution of the Board of Directors, but only to the extent that such
Subsidiary: (a) has no Indebtedness other than Non-Recourse Debt; (b) is not
party to any agreement, contract, arrangement or understanding with the Company
or any Restricted Subsidiary unless the terms of any such agreement, contract,
arrangement or understanding are no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time from
Persons who are not Affiliates of the Company; (c) is a Person with respect to
which neither the Company nor any of its Restricted Subsidiaries has any direct
or indirect obligation (1) to subscribe for additional Equity Interests or (2)
to maintain or preserve such Person's financial condition or to cause such
Person to achieve any specified levels of operating results; (d) has not
guaranteed or otherwise directly or indirectly provided credit support for any
Indebtedness of the Company or any of its Restricted Subsidiaries; and (e) has
at least one director on its board
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of directors that is not a director or executive officer of the Company or any
of its Restricted Subsidiaries and has at least one executive officer that is
not a director or executive officer of the Company or any of its Restricted
Subsidiaries.
"U.S. Person" means a U.S. person as defined in Rule 902(o) under the
Securities Act.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board
of Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse
between such date and the making of such payment, by (ii) the then outstanding
principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person and one or more Wholly Owned Restricted
Subsidiaries of such Person.
"Working Capital Adjustment" shall have the meaning assigned to such
term in the Merger Agreement.
SECTION 1.02. OTHER DEFINITIONS.
Defined in
Term Section
"Affiliate Transaction".......................................4.11
"Asset Sale Offer"............................................4.10
"Authentication Order"........................................2.02
"Change of Control Offer".....................................4.15
"Change of Control Payment"...................................4.15
"Change of Control Payment Date"..............................4.15
"Covenant Defeasance".........................................8.03
"Designated Senior Debt".....................................10.02
"DTC".........................................................2.03
"Event of Default"............................................6.01
"Excess Proceeds".............................................4.10
"incur".......................................................4.09
"Legal Defeasance"............................................8.02
"Notice of Default"...........................................6.01
"Offer Amount"................................................3.09
"Offer Period"................................................3.09
"Paying Agent"................................................2.03
"Payment Blockage Notice"....................................10.04
"Payment Default".............................................6.01
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"Permitted Debt"..............................................4.09
"Permitted Junior Securities"................................10.02
"Purchase Date"...............................................3.09
"Registrar"...................................................2.03
"Representative".............................................10.01
"Restricted Payments".........................................4.07
"Senior Debt"................................................10.01
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes and the Subsidiary Guarantees means the Company
and the Guarantors, respectively, and any successor obligor upon the Notes and
the Subsidiary Guarantees, respectively.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the
TIA have the meanings so assigned to them.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) provisions apply to successive events and transactions; and
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(6) references to sections of or rules under the Securities Act
shall be deemed to include substitute, replacement of successor sections or
rules adopted by the SEC from time to time.
ARTICLE 2.
THE NOTES
SECTION 2.01. FORM AND DATING.
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture and the Company, the
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions
of this Indenture, the provisions of this Indenture shall govern and be
controlling.
(b) Global Notes.
Notes issued in global form shall be substantially in the form of
Exhibits A1 or A2 attached hereto (including the Global Note Legend thereon and
the "Schedule of Exchanges of Interests in the Global Note" attached thereto).
Notes issued in definitive form shall be substantially in the form of Exhibit
A1 attached hereto (but without the Global Note Legend thereon and without the
"Schedule of Exchanges of Interests in the Global Note" attached thereto). Each
Global Note shall represent such of the outstanding Notes as shall be specified
therein and each shall provide that it shall represent the aggregate principal
amount of outstanding Notes from time to time endorsed thereon and that the
aggregate principal amount of outstanding Notes represented thereby may from
time to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the aggregate principal amount of outstanding Notes
represented thereby shall be made by the Trustee or the Note Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
(c) Temporary Global Notes.
Notes offered and sold in reliance on Regulation S shall be issued
initially in the form of the Regulation S Temporary Global Note, which shall be
deposited on behalf of the purchasers of the Notes represented thereby with the
Trustee, at its New York office, as custodian for the Depositary, and
registered in the name of the Depositary or the nominee of the Depositary for
the accounts of designated agents holding on behalf of Euroclear or Cedel Bank,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided. The Restricted Period shall be terminated upon the receipt by the
Trustee of (i) a written certificate from the Depositary, together with copies
of certificates from Euroclear and Cedel Bank certifying that they have
received certification of non-United States beneficial ownership of 100% of the
aggregate principal amount of the Regulation S Temporary Global Note (except to
the extent of any beneficial owners thereof who acquired an interest therein
during the Restricted Period pursuant to another exemption from registration
under the Securities Act and who will take delivery of a beneficial ownership
interest in a 144A
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Global Note or an IAI Global Note bearing a Private Placement Legend, all as
contemplated by Section 2.06(a)(ii) hereof), and (ii) an Officers' Certificate
from the Company. Following the termination of the Restricted Period,
beneficial interests in the Regulation S Temporary Global Note shall be
exchanged for beneficial interests in Regulation S Permanent Global Notes
pursuant to the Applicable Procedures. Simultaneously with the authentication
of Regulation S Permanent Global Notes, the Trustee shall cancel the Regulation
S Temporary Global Note. The aggregate principal amount of the Regulation S
Temporary Global Note and the Regulation S Permanent Global Notes may from time
to time be increased or decreased by adjustments made on the records of the
Trustee and the Depositary or its nominee, as the case may be, in connection
with transfers of interest as hereinafter provided.
(d) Euroclear and Cedel Procedures Applicable.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms
and Conditions of Cedel Bank" and "Customer Handbook" of Cedel Bank shall be
applicable to transfers of beneficial interests in the Regulation S Temporary
Global Note and the Regulation S Permanent Global Notes that are held by
Participants through Euroclear or Cedel Bank.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
Two Officers shall sign the Notes for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Note has
been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by two
Officers (an "Authentication Order"), authenticate Notes for original issue up
to the aggregate principal amount stated in paragraph 4 of the Notes. The
aggregate principal amount of Notes outstanding at any time may not exceed such
amount except as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
SECTION 2.03. REGISTRAR AND PAYING AGENT
The Company shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and
exchange. The Company may appoint one or more co-registrars and one or more
additional paying agents. The term "Registrar" includes any co-registrar and
the term "Paying Agent" includes any additional paying agent. The Company may
change any Paying Agent or Registrar without notice to any Holder. The Company
shall notify the Trustee in writing of the name and address of any Agent not a
party to this Indenture. If the
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Company fails to appoint or maintain another entity as Registrar or Paying
Agent, the Trustee shall act as such. The Company or any of its Subsidiaries
may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Note Custodian with respect to the Global Notes.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium or Liquidated Damages, if any, or interest on the Notes, and
will notify the Trustee of any default by the Company in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate
trust fund for the benefit of the Holders all money held by it as Paying Agent.
Upon any bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Paying Agent for the Notes.
SECTION 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes and the Company shall otherwise comply with TIA ss. 312(a).
SECTION 2.06. TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Global Notes.
A Global Note may not be transferred as a whole except by the
Depositary to a nominee of the Depositary, by a nominee of the Depositary to
the Depositary or to another nominee of the Depositary, or by the Depositary or
any such nominee to a successor Depositary or a nominee of such successor
Depositary. All Global Notes will be exchanged by the Company for Definitive
Notes if (i) the Company delivers to the Trustee notice from the Depositary
that it is unwilling or unable to continue to act as Depositary or that it is
no longer a clearing agency registered under the Exchange Act and, in either
case, a successor Depositary is not appointed by the Company within 120 days
after the date of such notice from the Depositary or (ii) the Company in its
sole discretion determines that the Global Notes (in whole but not in part)
should be exchanged for Definitive Notes and delivers a written notice to such
effect to the Trustee; provided that in no event shall the Regulation S
Temporary Global Note be exchanged by the Company for Definitive Notes prior to
(x) the expiration of the Restricted Period and (y) the receipt by the
Registrar of any certificates required pursuant to Rule 903(c)(3)(ii)(B) under
the Securities Act. Upon the occurrence of either of the preceding events in
(i) or (ii) above, Definitive Notes shall be issued in such names as the
Depositary shall instruct the Trustee.
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Global Notes also may be exchanged or replaced, in whole or in part, as
provided in Sections 2.07 and 2.10 hereof. Every Note authenticated and
delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be
authenticated and delivered in the form of, and shall be, a Global Note. A
Global Note may not be exchanged for another Note other than as provided in
this Section 2.06(a), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes.
The transfer and exchange of beneficial interests in the Global Notes
shall be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.
Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well
as one or more of the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however,
that prior to the expiration of the Restricted Period, transfers of
beneficial interests in the Temporary Regulation S Global Note may not be
made to a U.S. Person or for the account or benefit of a U.S. Person (other
than an Initial Purchaser). Beneficial interests in any Unrestricted Global
Note may be transferred to Persons who take delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note. No written orders or
instructions shall be required to be delivered to the Registrar to effect
the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of beneficial
interests that are not subject to Section 2.06(b)(i) above, the transferor
of such beneficial interest must deliver to the Registrar either (A) (1) a
written order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial interest in
another Global Note in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given in accordance with the
Applicable Procedures containing information regarding the Participant
account to be credited with such increase or (B) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to cause
to be issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged and (2) instructions given by the
Depositary to the Registrar containing information regarding the Person in
whose name such Definitive Note shall be registered to effect the transfer
or exchange referred to in (1) above; provided that in no event shall
Definitive Notes be issued upon the transfer or exchange of beneficial
interests in the Regulation S Temporary Global Note prior to (x) the
expiration of the Restricted Period and (y) the receipt by the Registrar of
any certificates required pursuant to Rule 903 under the Securities Act.
Upon consummation of an Exchange Offer by the Company in accordance with
Section 2.06(f) hereof, the requirements of this Section 2.06(b)(ii) shall
be deemed to have been satisfied upon receipt by the Registrar of the
instructions contained in the Letter of Transmittal delivered by the Holder
of such beneficial interests in the Restricted Global Notes. Upon
satisfaction of all of the requirements for transfer or exchange of
beneficial interests in Global Notes contained in this Indenture and the
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Notes or otherwise applicable under the Securities Act, the Trustee
shall adjust the principal amount of the relevant Global Note(s) pursuant
to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted Global
Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and each of the
Trustee and the Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transferee will take delivery in the form of a
beneficial interest in the Regulation S Temporary Global Note or the
Regulation S Global Note, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and
(C) if the transferee will take delivery in the form of a
beneficial interest in the IAI Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications and certificates and Opinion of Counsel required by
item (3) thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in the Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by any
holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note if the exchange or
transfer complies with the requirements of Section 2.06(b)(ii) above and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of the beneficial interest to be transferred, in the
case of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal or via the
Depositary's book-entry system that it is not (1) a broker-dealer, (2)
a Person participating in the distribution of the Exchange Notes or
(3) a Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) such transfer is effected pursuant to the Shelf Registration
Statement in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Participating Broker-Dealer
pursuant to the Exchange Offer Registration Statement in accordance
with the Registration Rights Agreement; or
(D) each of the Trustee and the Registrar receives the following:
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(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a Restricted
Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by each of the Trustee and the Registrar of the following
documentation:
(A) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note, a certificate from such holder in the form
of Exhibit C hereto, including the certifications in item (2)(a)
thereof;
(B) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903
or Rule 904 under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (2)
thereof;
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(D) if such beneficial interest is being transferred pursuant to
an exemption from the registration requirements of the Securities Act
in accordance with Rule 144 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in item (3)(a) thereof;
(E) if any such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those
listed in paragraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(F) if such beneficial interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (3)(b)
thereof; or
(G) if such beneficial interest is being transferred pursuant to
an effective registration statement under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof,
and the Company shall execute and the Trustee, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, shall
authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive Note
issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.06(c) shall be registered in such name or names
and in such authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Registrar through instructions from
the Depositary and the Participant or Indirect Participant. The Trustee
shall deliver such Definitive Notes to the Persons in whose names such
Notes are so registered. Any Definitive Note issued in exchange for a
beneficial interest in a Restricted Global Note pursuant to this Section
2.06(c)(i) shall bear the Private Placement Legend and shall be subject to
all restrictions on transfer contained therein.
(ii) Notwithstanding Sections 2.06(c)(i)(A) and (C) hereof, a
beneficial interest in the Regulation S Temporary Global Note may not be
exchanged for a Definitive Note or transferred to a Person who takes
delivery thereof in the form of a Definitive Note prior to (x) the
expiration of the Restricted Period and (y) the receipt by the Registrar of
any certificates required pursuant to Rule 903(c)(3)(ii)(B) under the
Securities Act, except in the case of a transfer pursuant to an exemption
from the registration requirements of the Securities Act other than Rule
903 or Rule 904.
(iii) Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. A holder of a beneficial interest in a Restricted Global
Note may exchange such beneficial interest for an Unrestricted Definitive
Note or may transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of such beneficial interest, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in
the applicable Letter of Transmittal that it is not (1) a
broker-
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<PAGE>
dealer, (2) a Person participating in the distribution of the
Exchange Notes or (3) a Person who is an affiliate (as defined in Rule
144) of the Company;
(B) such transfer is effected pursuant to the Shelf Registration
Statement in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Participating Broker-Dealer
pursuant to the Exchange Offer Registration Statement in accordance
with the Registration Rights Agreement; or
(D) the Trustee and the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest
for a Definitive Note that does not bear the Private Placement Legend,
a certificate from such holder in the form of Exhibit C hereto,
including the certifications in item (1)(b) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial interest
to a Person who shall take delivery thereof in the form of a
Definitive Note that does not bear the Private Placement Legend, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D),
if the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the Securities
Act.
(iv) Beneficial Interests in Unrestricted Global Notes to Unrestricted
Definitive Notes. If any holder of a beneficial interest in an Unrestricted
Global Note proposes to exchange such beneficial interest for a Definitive
Note or to transfer such beneficial interest to a Person who takes delivery
thereof in the form of a Definitive Note, then, upon satisfaction of the
conditions set forth in Section 2.06(b)(ii) hereof, the Trustee shall cause
the aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(h) hereof, and the Company shall
execute and the Trustee shall, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, authenticate and deliver to the Person
designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(iii) shall be registered in such
name or names and in such authorized denomination or denominations as the
holder of such beneficial interest shall instruct the Registrar through
instructions from the Depositary and the Participant or Indirect
Participant. The Trustee shall deliver such Definitive Notes to the Persons
in whose names such Notes are so registered. Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(iii)
shall not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
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(i) Restricted Definitive Notes to Beneficial Interests in Restricted
Global Notes. If any Holder of a Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global Note or
to transfer such Restricted Definitive Notes to a Person who takes delivery
thereof in the form of a beneficial interest in a Restricted Global Note,
then, upon receipt by each of the Trustee and the Registrar of the
following documentation:
(A) if the Holder of such Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global
Note, a certificate from such Holder in the form of Exhibit C hereto,
including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred to a
QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903
or Rule 904 under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (2)
thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if any such Restricted Definitive Note is being transferred
to an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other than
those listed in paragraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(F) if such Restricted Definitive Note is being transferred to
the Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
(G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase
or cause to be increased the aggregate principal amount of, in the
case of clause (A) above, the appropriate Restricted Global Note, in
the case of clause (B) above, the 144A Global Note, in the case of
clause (C) above, the Regulation S Global Note, and in all other
cases, the IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an
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<PAGE>
Unrestricted Global Note or transfer such Restricted Definitive Note
to a Person who takes delivery thereof in the form of a beneficial interest
in an Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in the
case of a transfer, certifies in the applicable Letter of Transmittal
that it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an affiliate
(as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf Registration
Statement in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Participating Broker-Dealer
pursuant to the Exchange Offer Registration Statement in accordance
with the Registration Rights Agreement; or
(D) each of the Trustee and the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the Unrestricted
Global Note, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item (1)(c)
thereof; or
(2) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery thereof
in the form of a beneficial interest in the Unrestricted Global
Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D),
if the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to
the Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with the
Securities Act.
Upon satisfaction of the conditions of any of the
subparagraphs in this Section 2.06(d)(ii), the Trustee shall
cancel the Definitive Notes and increase or cause to be increased
the aggregate principal amount of the Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note at any time. Upon receipt of a request for
such an exchange or transfer, the Trustee shall cancel the applicable
Unrestricted Definitive Note and increase or cause to be increased the
aggregate principal amount of one of the Unrestricted Global Notes.
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<PAGE>
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or
(iii) above at a time when an Unrestricted Global Note has not yet been issued,
the Company shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's
compliance with the provisions of this Section 2.06(e), the Registrar shall
register the transfer or exchange of Definitive Notes. Prior to such
registration of transfer or exchange, the requesting Holder shall present or
surrender to the Registrar the Definitive Notes duly endorsed or accompanied by
a written instruction of transfer in form satisfactory to the Registrar duly
executed by such Holder or by his attorney, duly authorized in writing. In
addition, the requesting Holder shall provide any additional certifications,
documents and information, as applicable, required pursuant to the following
provisions of this Section 2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive Notes. Any
Restricted Definitive Note may be transferred to and registered in the name
of Persons who take delivery thereof in the form of a Restricted Definitive
Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A under the
Securities Act, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item (1)
thereof;
(B) if the transfer will be made pursuant to Rule 903 or Rule
904, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2) thereof;
and
(C) if the transfer will be made pursuant to any other exemption
from the registration requirements of the Securities Act, then the
transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any
Restricted Definitive Note may be exchanged by the Holder thereof for an
Unrestricted Definitive Note or transferred to a Person or Persons who take
delivery thereof in the form of an Unrestricted Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in the
case of a transfer, certifies in the applicable Letter of Transmittal
that it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an affiliate
(as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
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<PAGE>
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) each of the Trustee and the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted Definitive Note, a
certificate from such Holder in the form of Exhibit C hereto,
including the certifications in item (1)(d) thereof; or
(2) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take delivery
thereof in the form of an Unrestricted Definitive Note, a certificate
from such Holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D),
if the Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Company to the effect that such exchange or transfer
is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the Securities
Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes.
A Holder of Unrestricted Definitive Notes may transfer such Notes to a
Person who takes delivery thereof in the form of an Unrestricted Definitive
Note. Upon receipt of a request to register such a transfer, the Registrar
shall register the Unrestricted Definitive Notes pursuant to the
instructions from the Holder thereof.
(f) Exchange Offer.
Upon the occurrence of the Exchange Offer in accordance with the
Registration Rights Agreement, the Company shall issue and, upon receipt of an
Authentication Order in accordance with Section 2.02, the Trustee shall
authenticate (i) one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of the beneficial interests in
the Restricted Global Notes tendered for acceptance by Persons that certify in
the applicable Letters of Transmittal that (x) they are not broker-dealers, (y)
they are not participating in a distribution of the Exchange Notes and (z) they
are not affiliates (as defined in Rule 144) of the Company, and accepted for
exchange in the Exchange Offer and (ii) Definitive Notes in an aggregate
principal amount equal to the principal amount of the Restricted Definitive
Notes accepted for exchange in the Exchange Offer. Concurrently with the
issuance of such Notes, the Trustee shall cause the aggregate principal amount
of the applicable Restricted Global Notes to be reduced accordingly, and the
Company shall execute and the Trustee shall, upon receipt of an Authentication
Order in accordance with Section 2.02, authenticate and deliver to the Persons
designated by the Holders of Definitive Notes so accepted Definitive Notes in
the appropriate principal amount.
(g) Legends.
The following legends shall appear on the face of all Global Notes and
Definitive Notes issued under this Indenture unless specifically stated
otherwise in the applicable provisions of this Indenture.
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<PAGE>
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each Global
Note and each Definitive Note (and all Notes issued in exchange
therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THE NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY HAS NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR ANY STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY
NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE.
BY ITS ACQUISITION HEREOF, THE HOLDER: REPRESENTS THAT (1) IT IS (A) A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) NOT A U.S. PERSON AND IS ACQUIRING THE NOTE
EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION; (2) AGREES THAT IT WILL
NOT RESELL OR OTHERWISE TRANSFER THE NOTE EVIDENCED HEREBY EXCEPT TO
(A) THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES
ACT, (C) AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH
TRANSFER, FURNISHES TO THE CHASE MANHATTAN BANK, AS TRUSTEE (OR A
SUCCESSOR TRUSTEE, AS APPLICABLE), A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON
TRANSFER OF THE NOTE EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE
OBTAINED FROM SUCH TRUSTEE OR A SUCCESSOR TRUSTEE, AS APPLICABLE), (D)
OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, AND, IN EACH CASE, IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR ANY OTHER
APPLICABLE JURISDICTION; AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THE NOTE EVIDENCED HEREBY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IF THE PROPOSED TRANSFER
IS PURSUANT TO CLAUSE (C), (D) OR (E) ABOVE, THE HOLDER MUST, PRIOR TO
SUCH TRANSFER, FURNISH TO THE CHASE MANHATTAN BANK, AS TRUSTEE (OR A
SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL OPINIONS
OR OTHER INFORMATION AS IT MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH
TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION,"
"UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY
REGULATION S UNDER THE SECURITIES ACT."
(B) Notwithstanding the foregoing, any Global Note or Definitive
Note issued pursuant to subparagraphs (b)(iv), (c)(ii), (c)(iii),
(d)(ii),
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<PAGE>
(d)(iii), (e)(ii), (e)(iii) or (f) to this Section 2.06 (and all
Notes issued in exchange therefor or substitution thereof) shall
not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO
ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY
MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.07
OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT
OF THE COMPANY."
(iii) Regulation S Temporary Global Note Legend. The Regulation S
Temporary Global Note shall bear a legend in substantially the
following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND
THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED
NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER
THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY
GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON."
(h) Cancellation and/or Adjustment of Global Notes.
At such time as all beneficial interests in a particular Global
Note have been exchanged for Definitive Notes or a particular Global
Note has been redeemed, repurchased or canceled in whole and not in
part, each such Global Note shall be returned to or retained and
canceled by the Trustee in accordance with Section 2.11 hereof. At any
time prior to such cancellation, if any beneficial interest in a
Global Note is exchanged for or transferred to a Person who will take
delivery thereof in the form of a beneficial interest in another
Global Note or for Definitive Notes, the principal amount of Notes
represented by such Global Note shall be reduced accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the
Depositary to reflect such reduction; and if the beneficial interest
is being exchanged for or transferred to a Person who will take
delivery thereof in the form of a beneficial interest in another
Global Note, such other Global Note shall be increased accordingly and
an endorsement shall be made on such Global Note by the Trustee or by
the Depositary to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Global Notes
and Definitive Notes upon the Company's order or at the Registrar's
request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable
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<PAGE>
in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchange or transfer pursuant to
Sections 2.10, 3.06, 3.09, 4.10, 4.15 and 9.05 hereof).
(iii) The Registrar shall not be required to register the
transfer of or exchange any Note selected for redemption in whole or
in part, except the unredeemed portion of any Note being redeemed in
part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as
the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange.
(v) The Company shall not be required (A) to issue, to
register the transfer of or to exchange any Notes during a period
beginning at the opening of business 15 days before the day of any
selection of Notes for redemption under Section 3.02 hereof and ending
at the close of business on the day of selection, (B) to register the
transfer of or to exchange any Note so selected for redemption in
whole or in part, except the unredeemed portion of any Note being
redeemed in part or (C) to register the transfer of or to exchange a
Note between a record date and the next succeeding Interest Payment
Date.
(vi) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Company may deem
and treat the Person in whose name any Note is registered as the
absolute owner of such Note for the purpose of receiving payment of
principal of and interest on such Notes and for all other purposes,
and none of the Trustee, any Agent or the Company shall be affected by
notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and
Definitive Notes in accordance with the provisions of Section 2.02
hereof.
(viii) All certifications, certificates and Opinions of
Counsel required to be submitted to the Registrar pursuant to this
Section 2.06 to effect a registration of transfer or exchange may be
submitted by facsimile.
SECTION 2.07. REPLACEMENT NOTES
If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge for its expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
SECTION 2.08. OUTSTANDING NOTES.
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The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. Except as set forth in Section 2.09 hereof, a Note
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note; however, Notes held by the Company or a Subsidiary of
the Company shall not be deemed to be outstanding for purposes of Section
3.07(b) hereof.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
SECTION 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company, shall be
considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that the Trustee knows are so owned
shall be so disregarded. The Company agrees to notify the Trustee of the
existence of any Notes owned by the Company, any Guarantor, or any Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Company or any Guarantor.
SECTION 2.10. TEMPORARY NOTES
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that the Company
considers appropriate for temporary Notes and as shall be reasonably acceptable
to the Trustee. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture.
SECTION 2.11. CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment.
The Trustee and no one else shall cancel all Notes surrendered for registration
of transfer, exchange, payment, replacement or cancellation and shall destroy
canceled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Notes shall be delivered
to the Company. The Company may not issue new Notes to replace Notes that it
has paid or that have been delivered to the Trustee for cancellation.
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<PAGE>
SECTION 2.12. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee
in writing of the amount of defaulted interest proposed to be paid on each Note
and the date of the proposed payment. The Company shall fix or cause to be
fixed each such special record date and payment date, provided that no such
special record date shall be less than 10 days prior to the related payment
date for such defaulted interest. At least 15 days before the special record
date, the Company (or, upon the written request of the Company, the Trustee in
the name and at the expense of the Company) shall mail or cause to be mailed to
Holders a notice that states the special record date, the related payment date
and the amount of such interest to be paid.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
SECTION 3.01. NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth (i) the clause of this Indenture pursuant
to which the redemption shall occur, (ii) the redemption date, (iii) the
principal amount of Notes to be redeemed, (iv) the redemption price, and (v)
the CUSIP numbers of the Notes to be redeemed.
If the Company is required to make an offer to purchase Notes pursuant
to the provisions of Section 3.09 or 4.15 hereof, it shall furnish to the
Trustee an Officers' Certificate setting forth (i) the Section of this
Indenture pursuant to which the purchase shall occur, (ii) the purchase date,
(iii) the principal amount of Notes to be purchased, (iv) the purchase price
and (v) a statement to the effect that (a) the Company or one of its
Subsidiaries has effected an Asset Sale and the conditions set forth in
Sections 3.09 and 4.10 have been satisfied or (b) a Change of Control has
occurred and the conditions set forth in Section 4.15 have been satisfied, as
applicable.
SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED
If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee shall select the Notes to be
redeemed or purchased among the Holders of the Notes in compliance with the
requirements of the principal national securities exchange, if any, on which
the Notes are listed or, if the Notes are not so listed, on a pro rata basis,
by lot or in accordance with any other method the Trustee considers fair and
appropriate. In the event of partial redemption by lot, the particular Notes to
be redeemed shall be selected, unless otherwise provided herein, not less than
30 nor more than 60 days prior to the redemption date by the Trustee from the
outstanding Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions
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of this Indenture that apply to Notes called for redemption also apply to
portions of Notes called for redemption.
SECTION 3.03. NOTICE OF REDEMPTION
Subject to the provisions of Section 3.09 hereof, at least 30 days but
not more than 60 days before a redemption date, the Company shall mail or cause
to be mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed, including the
CUSIP numbers, and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture pursuant
to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy of
the CUSIP number, if any, listed in such notice or printed on the Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that
the Company shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as
provided in the preceding paragraph.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE
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One Business Day prior to the redemption date, the Company shall
deposit with the Trustee or with the Paying Agent money sufficient to pay the
redemption price of and accrued interest on all Notes to be redeemed on that
date. The Trustee or the Paying Agent shall promptly return to the Company any
money deposited with the Trustee or the Paying Agent by the Company in excess
of the amounts necessary to pay the redemption price of, and accrued interest
on, all Notes to be redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption. If a Note is redeemed
on or after an interest record date but on or prior to the related interest
payment date, then any accrued and unpaid interest shall be paid to the Person
in whose name such Note was registered at the close of business on such record
date. If any Note called for redemption shall not be so paid upon surrender for
redemption because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal, from the redemption
date until such principal is paid, and to the extent lawful on any interest not
paid on such unpaid principal, in each case at the rate provided in the Notes
and in Section 4.01 hereof.
SECTION 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 3.07, the
Company shall not have the option to redeem the Notes pursuant to this Section
3.07 prior to February 1, 2003. Thereafter, the Company shall have the option
to redeem the Notes, in whole or in part, upon not less than 30 nor more than
60 days' notice, at the redemption prices (expressed as percentages of
principal amount) set forth below, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the applicable redemption date, if
redeemed during the twelve-month period beginning on February 1 of the years
indicated below:
YEAR PERCENTAGE
- ---- ----------
2003................................................... 104.563%
2004................................................... 103.042%
2005................................................... 101.521%
2006 and thereafter.................................... 100.000%
(b) Notwithstanding the foregoing, prior to February 1, 2001, the
Company may, on any one or more occasions, redeem up to 35% of the aggregate
principal amount of Notes originally issued in the Offering at a redemption
price of 109.125% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the redemption date, with
the net cash proceeds of an offering of common equity of the Company (other
than Disqualified Stock); provided that (i) at least 65% of the aggregate
principal amount of the Notes originally issued in the Offering remain
outstanding immediately after the occurrence of each such redemption (excluding
Notes held by the Company and its Subsidiaries) and (ii) each such redemption
shall occur within 75 days after the date of the closing of any such offering
of common equity of the Company.
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(c) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.06 hereof.
SECTION 3.08. MANDATORY REDEMPTION.
The Company shall not be required to make mandatory redemption
payments with respect to the Notes, except as set forth in Section 4.15.
SECTION 3.09. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
In the event that, pursuant to Section 4.10 hereof, the Company shall
be required to commence an Asset Sale Offer, it shall follow the procedures
specified below.
The Asset Sale Offer shall remain open for a period of 20 Business
Days following its commencement and no longer, except to the extent that a
longer period is required by applicable law (the "Offer Period"). No later than
five Business Days after the termination of the Offer Period (the "Purchase
Date"), the Company shall purchase the principal amount of Notes required to be
purchased pursuant to Section 4.10 hereof (the "Offer Amount") or, if less than
the Offer Amount has been tendered, all Notes tendered in response to the Asset
Sale Offer. Payment for any Notes so purchased shall be made in the same manner
as interest payments are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest shall
be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company shall send,
by first class mail, a notice to the Trustee and each of the Holders. The
notice shall contain all instructions and materials necessary to enable such
Holders to tender Notes pursuant to the Asset Sale Offer. The Asset Sale Offer
shall be made to all Holders. The notice, which shall govern the terms of the
Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to this Section 3.09
and Section 4.10 hereof and the length of time the Asset Sale Offer shall
remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue to
accrete or accrue interest;
(d) that, unless the Company defaults in making such payment, any Note
accepted for payment pursuant to the Asset Sale Offer shall cease to accrete or
accrue interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an Asset
Sale Offer may only elect to have all of such Note purchased and may not elect
to have only a portion of such Note purchased;
(f) that Holders electing to have a Note purchased pursuant to any Asset
Sale Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Company, a depositary, if appointed by
the Company, or a Paying Agent at the address specified in the notice at least
three days before the Purchase Date;
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(g) that Holders shall be entitled to withdraw their election if the
Company, the depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Company shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by the Company in
accordance with the terms of this Section 3.09. The Company, the Depositary or
the Paying Agent, as the case may be, shall promptly (but in any case not later
than five days after the Purchase Date) mail or deliver to each tendering
Holder an amount equal to the purchase price of the Notes tendered by such
Holder and accepted by the Company for purchase, and the Company shall promptly
issue a new Note, and the Trustee, upon written request from the Company shall
authenticate and mail or deliver such new Note to such Holder, in a principal
amount equal to any unpurchased portion of the Note surrendered. Any Note not
so accepted shall be promptly mailed or delivered by the Company to the Holder
thereof. The Company shall publicly announce the results of the Asset Sale
Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
ARTICLE 4.
COVENANTS
SECTION 4.01. PAYMENT OF NOTES.
The Company or a Guarantor shall pay or cause to be paid the principal
of, premium, if any, and interest and Liquidated Damages, if any, on the Notes
on the dates and in the manner provided in the Notes. Principal, premium, if
any, and interest and Liquidated Damages, if any, shall be considered paid on
the date due if the Paying Agent, if other than the Company or a Subsidiary
thereof, holds as of 10:00 a.m. Eastern Time on the due date money deposited by
the Company in immediately available funds and designated for and sufficient to
pay all principal, premium, if any, and interest and Liquidated Damages, if
any, then due. The Company shall pay all Liquidated Damages, if any, in the
same manner on the dates and in the amounts set forth in the Registration
Rights Agreement.
The Company or a Guarantor shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal at
the rate equal to 1% per annum in excess of the then applicable interest rate
on the Notes to the extent lawful; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest and Liquidated Damages (without regard to any
applicable grace period) at the same rate to the extent lawful.
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SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain in the Borough of Manhattan, the City of
New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may
be served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York for such purposes. The Company shall
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency. The
Company hereby designates the Corporate Trust Office of the Trustee as one such
office or agency of the Company in accordance with Section 2.03.
SECTION 4.03. REPORTS.
(a) Whether or not required by the rules and regulations of the SEC, so
long as any Notes are outstanding, the Company shall furnish to the Trustee and
the Holders of Notes (i) all quarterly and annual financial information that
would be required to be contained in a filing with the SEC on Forms 10-Q and
10-K if the Company were required to file such forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations" that
describes the financial condition and results of operations of the Company and
its consolidated Subsidiaries (showing in reasonable detail, either on the face
of the financial statements or in the footnotes thereto and in Management's
Discussion and Analysis of Financial Condition and Results of Operations, the
financial condition and results of operations of the Company and its Restricted
Subsidiaries separate from the financial information and results of operations
of the Unrestricted Subsidiaries of the Company) and, with respect to the
annual information only, a report thereon by the Company's certified
independent accountants and (ii) all current reports that would be required to
be filed with the SEC on Form 8-K if the Company were required to file such
reports, in each case, within the time periods specified in the SEC's rules and
regulations. In addition, following consummation of the Exchange Offer, whether
or not required by the rules and regulations of the SEC, the Company shall file
a copy of all such information and reports with the SEC for public availability
within the time periods specified in the SEC's rules and regulations (unless
the SEC will not accept such a filing) and make such information available to
securities analysts and prospective investors upon request. The Company shall
at all times comply with TIA ss. 314(a).
(b) For so long as any Notes remain outstanding, the Company and the
Guarantors shall furnish to the Holders and to securities analysts and
prospective investors, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
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SECTION 4.04. COMPLIANCE CERTIFICATE.
(a) The Company and each Guarantor (to the extent that such Guarantor is
so required under the TIA) shall deliver to the Trustee, within 90 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Company and its Subsidiaries during the preceding fiscal
year has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained
in this Indenture and is not in default in the performance or observance of any
of the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a) above shall be accompanied by
a written statement of the Company's independent public accountants (who shall
be a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article 4 or Article 5 hereof or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any
Default or Event of Default, an Officers' Certificate specifying such Default
or Event of Default and what action the Company is taking or proposes to take
with respect thereto.
SECTION 4.05. TAXES.
The Company shall pay, and shall cause each of its Subsidiaries to
pay, prior to delinquency, all material taxes, assessments, and governmental
levies except such as are contested in good faith and by appropriate
proceedings or where the failure to effect such payment is not adverse in any
material respect to the Holders of the Notes.
SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
The Company and each of the Guarantors covenants (to the extent that
it may lawfully do so) that it shall not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and the
Company and each of the Guarantors (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it shall not, by resort to any such law, hinder, delay or impede the
execution of any power herein
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granted to the Trustee, but shall suffer and permit the execution of every such
power as though no such law has been enacted.
SECTION 4.07. RESTRICTED PAYMENTS.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or
make any other payment or distribution on account of the Company's or any of
its Restricted Subsidiary's Equity Interests (including, without limitation,
any payment in connection with any merger or consolidation involving the
Company or any Restricted Subsidiary) or to any direct or indirect holders of
the Company's Equity Interests in their capacity as such (other than dividends
or distributions (a) payable in Equity Interests (other than Disqualified
Stock) of the Company or (b) to the Company or any Wholly Owned Restricted
Subsidiary of the Company); (ii) purchase, redeem or otherwise acquire or
retire for value (including, without limitation, in connection with any merger
or consolidation involving the Company) any Equity Interests of the Company or
any of its Restricted Subsidiaries or any direct or indirect parent of the
Company (other than any such Equity Interests owned by the Company or any
Restricted Subsidiary of the Company or Permitted Investments); (iii) make any
payment on or with respect to, or purchase, redeem, defease or otherwise
acquire or retire for value any Indebtedness of the Company or any Restricted
Subsidiary that is subordinated to the Notes or any guarantee of the Notes,
except a payment of interest or principal at Stated Maturity; or (iv) make any
Restricted Investment (all such payments and other actions set forth in clauses
(i) through (iv) above being collectively referred to as "Restricted
Payments"), unless, at the time of and after giving effect to such Restricted
Payment:
(a) no Default or Event of Default shall have occurred and be continuing
or would occur as a consequence thereof; and
(b) the Company would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the applicable four-quarter period, have been permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Debt to Cash
Flow Ratio test set forth in the first paragraph of Section 4.09 hereof, and
(c) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by the Company and its Restricted Subsidiaries
after the date hereof (excluding Restricted Payments permitted by clauses (ii),
(iii) and (vi) of the next succeeding paragraph), is less than the sum, without
duplication, of (i) 50% of the Consolidated Net Income of the Company for the
period (taken as one accounting period) from the beginning of the first fiscal
quarter commencing after the date hereof to the end of the Company's most
recently ended fiscal quarter for which internal financial statements are
available at the time of such Restricted Payment (or, if such Consolidated Net
Income for such period is a deficit, less 100% of such deficit), plus (ii) 100%
of the aggregate net cash proceeds received by the Company as a contribution to
its common equity capital or from the issue or sale since the date hereof of
Equity Interests of the Company (other than Disqualified Stock) or from the
issue or sale of Disqualified Stock or debt securities of the Company that have
been converted into such Equity Interests (other than Equity Interests (or
Disqualified Stock or convertible debt securities) sold to a Subsidiary of the
Company and other than Disqualified Stock or convertible debt securities that
have been converted into Disqualified Stock), plus (iii) 50% of any dividends
received by the Company or a Wholly Owned Restricted Subsidiary after the date
hereof from an Unrestricted Subsidiary of the Company, to the extent that such
dividends were not otherwise included in Consolidated Net Income of the Company
for such period, plus (iv) to the extent that any Restricted Investment that
was made after the date hereof is sold for cash or otherwise liquidated or
repaid for cash, the
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lesser of (A) the cash return of capital with respect to such Restricted
Investment (less the cost of disposition, if any) and (B) the initial amount of
such Restricted Investment.
The foregoing provisions will not prohibit (i) the payment of any
dividend within 60 days after the date of declaration thereof, if at the date
of declaration such payment would have complied with the provisions of this
Indenture; (ii) the redemption, repurchase, retirement, defeasance or other
acquisition of any Equity Interests of Company or subordinated Indebtedness of
the Company or any Guarantor in exchange for, or out of the net cash proceeds
of the substantially concurrent sale (other than to a Subsidiary of the
Company) of, other Equity Interests of the Company (other than any Disqualified
Stock); provided that the amount of any such net cash proceeds that are
utilized for any such redemption, repurchase, retirement, defeasance or other
acquisition shall be excluded from clause (c)(ii) of the preceding paragraph;
and, provided further, that no Default or Event of Default shall have occurred
and be continuing immediately after such transaction; (iii) the defeasance,
redemption, repurchase or other acquisition of subordinated Indebtedness with
the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness;
provided that no Default or Event of Default shall have occurred and be
continuing immediately after such transaction; (iv) the payment of any dividend
by a Restricted Subsidiary of the Company to the holders of Equity Interests on
a pro rata basis; (v) the repurchase, redemption or other acquisition or
retirement for value of any Equity Interests of the Company or any Restricted
Subsidiary of the Company held by any member of the Company's (or any of its
Restricted Subsidiaries') management or board of directors pursuant to any
management equity subscription agreement, stock option agreement or other
similar agreement; provided that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests shall not exceed
$250,000 in any twelve-month period and no Default or Event of Default shall
have occurred and be continuing immediately after such transaction; and (vi)
the repurchase, redemption or other acquisition or retirement for value or
payment made in respect of any Equity Interests of the Company or any
Restricted Subsidiary of the Company pursuant to any of the agreements relating
to the Pending Acquisitions, each as in effect on the date hereof; provided
that no Default or Event of Default shall have occurred and be continuing
immediately after such transaction.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The fair market value of any non-cash Restricted Payment shall be determined in
good faith by the Board of Directors whose resolution with respect thereto
shall be delivered to the Trustee. Not later than the date of making any
Restricted Payment, the Company shall deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which the calculations required by this Section 4.07 were
computed.
The Board of Directors may designate any Restricted Subsidiary to be
an Unrestricted Subsidiary if such designation would not cause a Default. For
purposes of making such determination, the aggregate fair market value of all
outstanding Investments by the Company and its Restricted Subsidiaries in the
Subsidiary so designated will be deemed to be a Restricted Payment at the time
of such designation and will reduce the amount available for Restricted
Payments under the first paragraph of this covenant. Such designation will only
be permitted if such Restricted Payment would be permitted at such time and if
such Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
Any such designation by the Board of Directors shall be evidenced to
the Trustee by filing with the Trustee a certified copy of the Board Resolution
giving effect to such designation and an Officers' Certificate certifying that
such designation complied with the foregoing conditions. If, at any time, any
Unrestricted Subsidiary would fail to meet the definition of an Unrestricted
Subsidiary, it shall thereafter cease
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to be an Unrestricted Subsidiary for purposes of this Indenture and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted
Subsidiary of the Company as of such date (and, if such Indebtedness is not
permitted to be incurred as of such date under Section 4.09 hereof, the Company
shall be in default).
The Board of Directors of the Company may at any time designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such
designation shall be deemed to be an incurrence of Indebtedness by a Restricted
Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted
Subsidiary and such designation shall only be permitted if (i) such
Indebtedness is permitted under Section 4.09 hereof, calculated on a pro forma
basis as if such designation had occurred at the beginning of the four-quarter
reference period and (ii) no Default or Event of Default would be in existence
immediately following such designation.
SECTION 4.08. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary to (a)(i) pay dividends or make any other distributions
to the Company or any of its Restricted Subsidiaries (A) on its Capital Stock
or (B) with respect to any other interest or participation in, or measured by,
its profits or (ii) pay any indebtedness owed to the Company or any of its
Restricted Subsidiaries, (b) make loans or advances to the Company or any of
its Restricted Subsidiaries or (c) transfer any of its properties or assets to
the Company or any of its Restricted Subsidiaries, except for such encumbrances
or restrictions existing under or by reasons of (i) Existing Indebtedness as in
effect on the date hereof, (ii) the Senior Credit Facility and any amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings thereof, and any other agreement governing or
relating to Senior Debt, provided that such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings and other agreements are no more restrictive with respect to such
dividend and other payment restrictions than those contained in the Senior
Credit Facility, (iii) this Indenture as in effect on the date hereof, the
Notes and the Subsidiary Guarantees, (iv) applicable law, (v) any instrument
governing Indebtedness or Capital Stock of a Person acquired by the Company or
any of its Restricted Subsidiaries as in effect at the time of such acquisition
(except to the extent such Indebtedness was incurred in connection with or in
anticipation of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person, or the property or assets of the Person, so acquired, provided
that, in the case of Indebtedness, such Indebtedness was permitted by the terms
of this Indenture to be incurred, (vi) by reason of customary non-assignment
provisions in leases entered into in the ordinary course of business and
consistent with past practices, (vii) purchase money obligations for property
acquired in the ordinary course of business that impose restrictions of the
nature described in clause (c) above on the property so acquired, (viii)
Permitted Refinancing Indebtedness, provided that the restrictions contained in
the agreements governing such Permitted Refinancing Indebtedness are no more
restrictive than those contained in the agreements governing the Indebtedness
being refinanced, (ix) secured Indebtedness otherwise permitted to be incurred
pursuant to the provisions of Section 4.12 hereof that limits the right of the
debtor to dispose of the assets securing such Indebtedness, (x) provisions with
respect to the disposition or distribution of assets or property in joint
venture agreements and other similar agreements entered into in the ordinary
course of business and (xi) restrictions on cash or other deposits or net worth
imposed by customers under contracts entered into in the ordinary course of
business.
SECTION 4.09. INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.
The Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, create, incur, issue, assume, guarantee or
otherwise become directly or indirectly liable, contingently or
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otherwise, with respect to (collectively, "incur") any Indebtedness (including
Acquired Debt) or issue any shares of Disqualified Stock and will not permit
any of its Subsidiaries to issue any shares of preferred stock; provided,
however, that, so long as no Default or Event of Default has occurred and is
continuing, the Company may incur Indebtedness (including Acquired Debt) or
issue shares of Disqualified Stock and the Guarantors may issue shares of
preferred stock if, in each case, the Company's Debt to Cash Flow Ratio at the
time of incurrence of such Indebtedness or the issuance of such Disqualified
Stock or preferred stock, as the case may be, after giving pro forma effect to
such incurrence or issuance as of such date and to the use of the proceeds
therefrom as if the same had occurred at the beginning of the most recently
ended four full fiscal quarter period of the Company for which internal
financial statements are available, would have been no greater than (a) 7.0 to
1.0, if such incurrence or issuance is prior to December 31, 1999 or (b) 6.0 to
1.0 thereafter.
The provisions of the first paragraph of this covenant will not apply
to the incurrence of any of the following (collectively, "Permitted Debt"):
(i) the incurrence by the Company (and the guarantee thereof by
Guarantors) of Indebtedness and Letters of Credit under one or more Credit
Facilities in an aggregate principal amount at any time outstanding not to
exceed $400.0 million (with letters of credit being deemed to have a
principal amount equal to the maximum potential liability of the Company
and the Guarantors thereunder), less the aggregate amount of all
repayments, optional or mandatory, of the principal of any term
Indebtedness under a Credit Facility that have been made since the date
hereof and less the aggregate amount of all commitment reductions of any
revolving Indebtedness under a Credit Facility pursuant to clause (i) of
the third paragraph of Section 4.10 hereof;
(ii) the incurrence by the Company and the guarantee thereof by the
Guarantors of Indebtedness represented by the Notes and the Subsidiary
Guarantees;
(iii) the incurrence by the Company and its Restricted Subsidiaries of
the Existing Indebtedness;
(iv) the incurrence by the Company or its Restricted Subsidiaries of
Indebtedness represented by Capital Lease Obligations, mortgage financings
or purchase money obligations, in each case incurred for the purpose of
financing all or any part of the purchase price or cost of construction or
improvement of property, plant or equipment used in the business of the
Company or such Restricted Subsidiary, in an aggregate amount not to exceed
$5.0 million at any time outstanding, including all Permitted Refinancing
Debt incurred pursuant to clause (v) below to refund, replace or refinance
any Indebtedness pursuant to this clause (iv);
(v) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the
net proceeds of which are used to refund, refinance or replace Indebtedness
(other than intercompany Indebtedness) that was permitted by this Indenture
to be incurred by the first paragraph of this Section 4.09, or by clauses
(ii), (iii), (iv), (v), (vii) or (x) of this paragraph;
(vi) the incurrence of Indebtedness between or among the Company and
any of its Restricted Subsidiaries; provided, however, that (a) if the
Company is the obligor on such Indebtedness, such Indebtedness is expressly
subordinated to the prior payment in full of all Obligations with respect
to the Notes and (b) any subsequent issuance or transfer of Equity
Interests
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that results in any such Indebtedness being held by a Person other
than the Company or a Restricted Subsidiary, and any sale or other transfer
of any such Indebtedness to a Person that is not either the Company or a
Restricted Subsidiary, shall be deemed, in each case, to constitute an
incurrence of such Indebtedness by the Company or such Restricted
Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred for the purpose of
fixing or hedging interest rate risk with respect to any floating rate
Indebtedness that is permitted by the terms of this Indenture to be
outstanding;
(viii) the guarantee by the Company or any of the Guarantors of
Indebtedness that was permitted to be incurred by another provision of this
Section 4.09;
(ix) the incurrence by the Company's Unrestricted Subsidiaries of
Non-Recourse Debt, provided, however, that if any such Indebtedness ceases
to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be
deemed to constitute an incurrence of Indebtedness by a Restricted
Subsidiary of the Company that was not permitted by this clause (ix);
(x) the issuance of preferred stock by the Company pursuant to the
Contemporary Agreement, as in effect on the date of this Indenture; and
(xi) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal amount at
any time outstanding, including all Permitted Refinancing Indebtedness
incurred pursuant to clause (v) above to refund, refinance or replace any
Indebtedness incurred pursuant to this clause (xi), not to exceed $10.0
million.
For purposes of determining compliance with this covenant, in the
event that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (i) through (xi) above or is
entitled to be incurred pursuant to the first paragraph of this covenant, the
Company shall, in its sole discretion, classify such item of Indebtedness in
any manner that complies with this Section 4.09 and such item of Indebtedness
will be treated as having been incurred pursuant to only one of such clauses or
pursuant to the first paragraph hereof. Accrual of interest, the accretion of
accreted value, the payment of interest on any Indebtedness in the form of
additional Indebtedness with the same terms and the payment of dividends on
Disqualified Stock in the form of additional shares of the same class of
Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an
issuance of Disqualified Stock for purposes of this covenant.
SECTION 4.10. ASSET SALES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless (i) the Company or such
Restricted Subsidiary, as the case may be, receives consideration at the time
of such Asset Sale at least equal to the fair market value (evidenced by a
resolution of the Board of Directors set forth in an Officers' Certificate
delivered to the Trustee) of the assets or Equity Interests issued or sold or
otherwise disposed of and (ii) at least 75% of the consideration therefor
received by the Company or such Restricted Subsidiary is in the form of cash or
Cash Equivalents; provided that the amount of (a) any liabilities (as shown on
the Company's or such Restricted Subsidiary's most recent balance sheet) of the
Company or such Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes or any guarantee
thereof) that are assumed by the transferee of any such assets pursuant to a
customary novation agreement that releases the Company or such Restricted
Subsidiary from
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further liability, (b) any securities, notes or other obligations received by
the Company or such Restricted Subsidiary from such transferee that are
immediately converted by the Company or such Restricted Subsidiary into cash
(to the extent of the cash received) and (c) escrowed cash that the Company
reasonably believes will be released from escrow within 365 days from the date
of consummation of such Asset Sale, in each case shall be deemed to be cash for
purposes of this provision.
Notwithstanding the immediately preceding paragraph, the Company and
its Restricted Subsidiaries will be permitted to consummate an Asset Sale
without complying with such paragraph if (i) the Company or the applicable
Restricted Subsidiary, as the case may be, receives consideration at the time
of such Asset Sale at least equal to the fair market value of the assets or
other property sold, issued or otherwise disposed of (as evidenced by a
resolution of the Company's Board of Directors set forth in an Officers'
Certificate delivered to the Trustee) and (ii) at least 75% of the
consideration for such Asset Sale constitutes a controlling interest in a
Permitted Business, long-term assets used or useful in a Permitted Business
and/or cash or Cash Equivalents; provided that any cash or Cash Equivalents
received by the Company or any of its Restricted Subsidiaries in connection
with any Asset Sale permitted to be consummated under this paragraph shall
constitute Net Proceeds subject to the provisions of the next succeeding
paragraph.
Within 365 days of the receipt of any Net Proceeds from an Asset Sale,
the Company may apply such Net Proceeds, at its option, (i) to repay Senior
Debt under a Credit Facility (and to correspondingly reduce commitments with
respect thereto in the case of revolving borrowings) or (ii) to the acquisition
of a controlling interest in a Permitted Business, the making of a capital
expenditure or the acquisition of other long-term assets, in each case, used or
useful in a Permitted Business. Pending the final application of any such Net
Proceeds, the Company may temporarily reduce Senior Debt or otherwise invest
such Net Proceeds in any manner that is not prohibited by this Indenture. Any
Net Proceeds from Asset Sales that are not applied or invested as provided in
the first sentence of this paragraph shall be deemed to constitute "Excess
Proceeds." When the aggregate amount of Excess Proceeds exceeds $10.0 million,
the Company shall be required to make an offer to all Holders of Notes and all
holders of other pari passu Indebtedness containing provisions similar to those
set forth in this Indenture with respect to offers to purchase or redeem such
other pari passu Indebtedness with the proceeds of sales of assets (an "Asset
Sale Offer") to purchase the maximum principal amount of Notes and such other
pari passu Indebtedness that may be purchased out of the Excess Proceeds at an
offer price in cash in an amount equal to 100% of the principal amount thereof,
plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the
date of purchase, in accordance with the procedures set forth in this Indenture
and in such other pari passu Indebtedness. To the extent that the aggregate
amount of Notes and such other pari passu Indebtedness tendered pursuant to an
Asset Sale Offer is less than the Excess Proceeds, the Company may use any
remaining Excess Proceeds for any purpose not otherwise prohibited by this
Indenture. If the aggregate principal amount of Notes and such other pari passu
Indebtedness surrendered by Holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis. Upon completion of an Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero.
SECTION 4.11. TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless
(i) such Affiliate Transaction is on terms that are no less favorable to the
Company or such Restricted Subsidiary than those that would have been obtained
in a comparable transaction by the Company or such Restricted Subsidiary with
an unrelated Person and (ii) the Company delivers to the Trustee
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(a) with respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $1.0 million, a
resolution of the Board of Directors set forth in an Officers' Certificate
certifying that such Affiliate Transaction complies with clause (i) above and
that such Affiliate Transaction has been approved by a majority of the members
of the Board of Directors that are disinterested as to such Affiliate
Transaction and (b) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in excess of
$5.0 million, an opinion as to the fairness to the Company of such Affiliate
Transaction from a financial point of view issued by an accounting, appraisal
or investment banking firm of national standing; provided that (1) any
employment agreement entered into by, and any compensation paid by, the Company
or any of its Restricted Subsidiaries, in each case, approved by the
Compensation Committee, (2) transactions between or among the Company and/or
its Restricted Subsidiaries, (3) fees and compensation paid to members of the
Board of Directors of the Company and of its Restricted Subsidiaries in their
capacity as such, to the extent such fees and compensation are reasonable,
customary and consistent with past practices and the issuance of shares of the
Company to the Directors who were holders of options or stock appreciation
rights in Broadcasting as of the Spin-Off record date, whether or not vested,
(4) fees and compensation paid to, and indemnity provided on behalf of,
officers, directors or employees of the Company or any of its Restricted
Subsidiaries, as determined by the Board of Directors of the Company or of any
such Restricted Subsidiary, to the extent such fees and compensation are
reasonable, customary and consistent with past practices, (5) the transactions
specifically contemplated by the Merger Agreement, the agreements relating to
the Pending Acquisitions or by instruments referred to in any such agreements,
in each case, as the same are in effect on the date hereof, (6) the Spin-Off
Transactions, (7) the transactions specifically contemplated by the
Delsener/Slater Employment Agreements, in each case as in effect on the date
hereof, (8) the Meadows Repurchase and the Series E Preferred Repurchase;
provided that the Company receives either (x) a cash payment from Broadcasting
or Broadcasting Buyer or an Affiliate thereof at or prior to the date of the
Broadcasting Merger at least equal to the aggregate amount expended by the
Company in the Meadows Repurchase and the Series E Preferred Repurchase less
$3.0 million or (y) an increase in favor of the Company in the Working Capital
Adjustment (including the avoidance of a decrease) contemplated by the Merger
Agreement in an amount at least equal to the aggregate amount expended by the
Company in the Meadows Repurchase and the Series E Preferred Repurchase less
$3.0 million or (z) any combination thereof adding up to an amount at least
equal to the aggregate amount expended by the Company in the Meadows Repurchase
and the Series E Preferred Repurchase less $3.0 million; and (9) any Restricted
Payment that is permitted by the provisions of Section 4.07 hereof, in each
case, shall not be deemed to be Affiliate Transactions.
SECTION 4.12. LIENS.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly create, incur, assume or suffer to
exist any Lien securing Indebtedness or trade payables on any asset now owned
or hereafter acquired, or any income or profits therefrom or assign or convey
any right to receive income therefrom, except Permitted Liens.
SECTION 4.13. BUSINESS ACTIVITIES.
The Company shall not, and shall not permit any Restricted Subsidiary
to, engage in any business other than Permitted Businesses, except to such
extent as would not be material to the Company and its Restricted Subsidiaries
taken as a whole.
SECTION 4.14. CORPORATE EXISTENCE.
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Subject to Article 5 hereof, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each
of its Subsidiaries, in accordance with the respective organizational documents
(as the same may be amended from time to time) of the Company or any such
Subsidiary and (ii) the rights (charter and statutory), licenses and franchises
of the Company and its Subsidiaries; provided, however, that the Company shall
not be required to preserve any such right, license or franchise, or the
corporate, partnership or other existence of any of its Subsidiaries, if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and its Subsidiaries,
taken as a whole, and that the loss thereof is not adverse in any material
respect to the Holders of the Notes.
SECTION 4.15. OFFER TO REPURCHASE UPON CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, the Company shall be
obligated to make an offer (a "Change of Control Offer") to each Holder of
Notes to repurchase all or any part (equal to $1,000 or an integral multiple
thereof) of such Holder's Notes at an offer price in cash equal to 101% of the
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the date of purchase (the "Change of Control
Payment"). Within ten days following a Change of Control, the Company will mail
a notice to the Trustee and each Holder describing the transaction or
transactions that constitute the Change of Control and offering to repurchase
Notes on the date specified in such notice, which date shall be no earlier than
30 days and no later than 60 days from the date such notice is mailed (the
"Change of Control Payment Date"), pursuant to the procedures required by this
Indenture and described in such notice. The Company will comply with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent such laws and regulations are
applicable in connection with the repurchase of the Notes as a result of a
Change of Control.
(b) On the Change of Control Payment Date, the Company will, to the extent
lawful, (i) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent an
amount equal to the Change of Control Payment in respect of all Notes or
portions thereof so tendered and (iii) deliver or cause to be delivered to the
Trustee the Notes so accepted together with an Officers' Certificate stating
the aggregate principal amount of Notes or portions thereof being purchased by
the Company. The Paying Agent will promptly mail to each Holder of Notes so
tendered the Change of Control Payment for such Notes, and the Trustee will
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; provided that each such new Note will be in a
principal amount of $1,000 or an integral multiple thereof. Prior to complying
with the provisions of this Section 4.15, but in any event within 90 days
following a Change of Control, the Company will either repay all outstanding
Senior Debt or obtain the requisite consents, if any, under all agreements
governing outstanding Senior Debt to permit the repurchase of Notes required by
this Section 4.15. The Company will publicly announce the results of the Change
of Control Offer on or as soon as practicable after the Change of Control
Payment Date.
The Change of Control provisions described above will be applicable
whether or not any other provisions of this Indenture are applicable.
(c) Notwithstanding anything to the contrary in this Section 4.15, the
Company shall not be required to make a Change of Control Offer upon a Change
of Control if a third party makes the Change of Control Offer in the manner, at
the times and otherwise in compliance with the requirements set forth in this
Section 4.15 and Section 3.09 hereof and purchases all Notes validly tendered
and not withdrawn under such Change of Control Offer.
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SECTION 4.16. NO SENIOR SUBORDINATED DEBT.
Notwithstanding the provisions of Section 4.09 hereof, (i) the Company
shall not directly or indirectly incur any Indebtedness that is subordinate or
junior in right of payment to any Senior Debt and senior in any respect in
right of payment to the Notes and (ii) no Guarantor shall incur any
Indebtedness that is subordinated or junior in right of payment to any
Guarantees of Senior Debt and senior in any respect in right of payment to the
Subsidiary Guarantees.
SECTION 4.17. ISSUANCES AND SALES OF EQUITY INTERESTS IN RESTRICTED
SUBSIDIARIES.
The Company (i) shall not, and shall not permit any Restricted
Subsidiary of the Company to, transfer, convey, sell, lease or otherwise
dispose of any Equity Interests in any Restricted Subsidiary of the Company to
any Person (other than the Company or a Restricted Subsidiary of the Company),
unless (a) such transfer, conveyance, sale, lease or other disposition is of
all the Equity Interests in such Restricted Subsidiary and (b) the cash Net
Proceeds, if any, from such transfer, conveyance, sale, lease or other
disposition are applied in accordance with Section 4.10 hereof, and (ii) will
not permit any Restricted Subsidiary of the Company to issue any of its Equity
Interests (other than, if necessary, shares of its Capital Stock constituting
directors' qualifying shares) to any Person other than to the Company or a
Restricted Subsidiary of the Company except as permitted pursuant to Section
4.09 hereof.
SECTION 4.18. LIMITATION ON SALE AND LEASEBACK TRANSACTIONS.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company and the Guarantors may enter into a sale and leaseback transaction
if (i) the Company or such Guarantor could have (a) incurred Indebtedness in an
amount equal to the Attributable Debt relating to such sale and leaseback
transaction pursuant to the Debt to Cash Flow Ratio test set forth in the first
paragraph of Section 4.09 hereof and (b) incurred a Lien to secure such
Indebtedness pursuant to Section 4.12 hereof, (ii) the gross cash proceeds of
such sale and leaseback transaction are at least equal to the fair market value
(as determined in good faith by the Board of Directors and set forth in an
Officers' Certificate delivered to the Trustee) of the property that is the
subject of such sale and leaseback transaction and (iii) the transfer of assets
in such sale and leaseback transaction is permitted by, and the proceeds of
such transaction are applied in compliance with Section 4.10 hereof.
SECTION 4.19. PAYMENTS FOR CONSENT.
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Notes for or as an inducement
to any consent, waiver or amendment of any of the terms or provisions of this
Indenture or the Notes unless such consideration is offered to be paid or is
paid to all Holders of the Notes that consent, waive or agree to amend in the
time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.
SECTION 4.20. ADDITIONAL SUBSIDIARY GUARANTEES.
If the Company or any of its Restricted Subsidiaries shall acquire or
create another domestic Restricted Subsidiary after the date of this Indenture
(other than the Non-Guarantor Subsidiaries), or any domestic Unrestricted
Subsidiary shall become a Restricted Subsidiary of the Company, then such
Subsidiary shall become a Guarantor by executing a Supplemental Indenture in
the form attached hereto as Exhibit F and
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deliver an Opinion of Counsel to the Trustee to the effect that such
Supplemental Indenture has been duly authorized, executed and delivered by such
Subsidiary and constitutes a valid and binding obligation of such Subsidiary,
enforceable against such Subsidiary in accordance with its terms (subject to
customary exceptions).
ARTICLE 5.
SUCCESSORS
SECTION 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.
The Company shall not consolidate or merge with or into (whether or
not the Company is the surviving corporation), or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all of its
properties or assets in one or more related transactions, to another
corporation, Person or entity unless (i) the Company is the surviving
corporation or the entity or the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made is a corporation organized or existing under the laws of the United
States, any state thereof or the District of Columbia; (ii) the entity or
Person formed by or surviving any such consolidation or merger (if other than
the Company) or the entity or Person to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made assumes all the
obligations of the Company under the Notes, the Indenture and the Registration
Rights Agreement pursuant to a supplemental indenture in a form reasonably
satisfactory to the Trustee; (iii) immediately after such transaction no
Default or Event of Default exists; and (iv) except in the case of a merger of
the Company with or into a Wholly Owned Restricted Subsidiary of the Company,
the Company or the entity or Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made will, both immediately prior to and immediately after giving pro forma
effect thereto as if such transaction had occurred at the beginning of the
applicable four-quarter period, be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Debt to Cash Flow Ratio test set forth
in Section 4.09 hereof.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the
assets of the Company in accordance with Section 5.01 hereof, the successor
corporation formed by such consolidation or into or with which the Company is
merged or to which such sale, assignment, transfer, lease, conveyance or other
disposition is made shall succeed to, and be substituted for (so that from and
after the date of such consolidation, merger, sale, lease, conveyance or other
disposition, the provisions of this Indenture referring to the "Company" shall
refer instead to the successor corporation and not to the Company), and may
exercise every right and power of the Company under this Indenture with the
same effect as if such successor Person had been named as the Company herein;
provided, however, that the predecessor Company shall not be relieved from the
obligation to pay the principal of and interest on the Notes except in the case
of a sale of all of the Company's assets that meets the requirements of Section
5.01 hereof.
ARTICLE 6.
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
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(a) the Company defaults for 30 days in the payment when due of interest
on, or Liquidated Damages, if any, with respect to, the Notes, whether or not
such payment is prohibited by the provisions of Article 10 hereof;
(b) the Company defaults in payment when due of the principal of or
premium, if any, on the Notes, whether or not such payment is prohibited by the
provisions of Article 10 hereof;
(c) the Company or any Restricted Subsidiary fails to comply with any of
the provisions of Section 4.15 or 5.01 hereof;
(d) the Company or any Restricted Subsidiary fails for 30 days after
written notice by the Trustee or the Holders of at least 25% in principal
amount of the then outstanding Notes to comply with the provisions of Section
3.09, 4.07, 4.09 or 4.10 hereof (such notice must specify the Default, demand
that it be remedied and state that the notice is a "Notice of Default");
(e) the Company or any Restricted Subsidiary fails for 60 days after
written notice by the Trustee or the Holders of at least 25% in principal
amount of the then outstanding Notes to comply with any of its other agreements
in this Indenture or the Notes (such notice must specify the Default, demand
that it be remedied and state that the notice is a "Notice of Default");
(f) the Company or any Restricted Subsidiary defaults under any
mortgage, indenture or instrument under which there may be issued or by which
there may be secured or evidenced any Indebtedness for money borrowed by the
Company or any of its Restricted Subsidiaries (or the payment of which is
guaranteed by the Company or any of its Restricted Subsidiaries), whether such
Indebtedness or guarantee now exists or is created after the date hereof, which
default (a) is caused by a failure to pay principal of or premium, if any, or
interest on such Indebtedness prior to the expiration of the grace period
provided in such Indebtedness on the date of such default (a "Payment Default")
or (b) results in the acceleration of such Indebtedness prior to its express
maturity and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness under which
there has been a Payment Default or the maturity of which has been so
accelerated, aggregates $10.0 million or more;
(g) the Company or any of its Restricted Subsidiaries fails to pay final
judgments aggregating in excess of $10.0 million, which judgments are not paid,
discharged or stayed for a period of 60 days;
(h) except as permitted by this Indenture, any Subsidiary Guarantee shall
be held in any judicial proceeding to be unenforceable or invalid or shall
cease for any reason to be in full force and effect or any Guarantor, or any
Person acting on behalf of any Guarantor, shall deny or disaffirm its
obligations under its Subsidiary Guarantee;
(i) the Company or any of the Company's Restricted Subsidiaries that
constitutes a Significant Subsidiary or any group of Restricted Subsidiaries of
the Company that, taken together, would constitute a Significant Subsidiary
pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an
involuntary case,
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(iii) consents to the appointment of a custodian of it or for all or
substantially all of its property,
(iv) makes a general assignment for the benefit of its creditors, or
(v) generally is not paying its debts as they become due; or
(j) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary in an involuntary case;
(ii) appoints a custodian of the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary or for all or substantially all of the
property of the Company or any of its Significant Subsidiaries or any group
of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary; or
(iii) orders the liquidation of the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive
days.
SECTION 6.02. ACCELERATION.
If any Event of Default (other than an Event of Default specified in
clause (i) or (j) of Section 6.01 hereof with respect to the Company, any
Significant Subsidiary or any group of Significant Subsidiaries that, taken as
a whole, would constitute a Significant Subsidiary) occurs and is continuing,
the Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes may declare all the Notes to be due and payable immediately.
Notwithstanding the foregoing, if an Event of Default specified in clause (i)
or (j) of Section 6.01 hereof occurs with respect to the Company, any
Restricted Subsidiary of the Company that constitutes a Significant Subsidiary
or any group of Restricted Subsidiaries of the Company that, taken together,
would constitute a Significant Subsidiary, all outstanding Notes will become
due and payable without further action or notice. Holders of the Notes may not
enforce this Indenture or the Notes except as provided in this Indenture.
Subject to certain limitations, Holders of a majority in principal amount of
the then outstanding Notes may direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of the Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest) if it determines that
withholding notice is in their interest.
If an Event of Default occurs on or after February 1, 2003 by reason
of any willful action (or inaction) taken (or not taken) by or on behalf of the
Company with the intention of avoiding payment of the premium that the Company
would have had to pay if the Company then had elected to redeem the Notes
pursuant to Section 3.07 hereof, then, upon acceleration of the Notes, an
equivalent premium shall also become and be immediately due and payable, to the
extent permitted by law, anything in this Indenture or in the Notes to the
contrary notwithstanding. If an Event of Default occurs prior to February 1,
2003 by reason of any willful action (or inaction) taken (or not taken) by or
on behalf of the Company with the intention of avoiding the prohibition on
redemption of the Notes prior to such date, then, upon acceleration of the
Notes, an additional premium shall also become and be immediately due and
payable in an amount, for each of the years
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beginning on February 1 of the years set forth below, as set forth below
(expressed as a percentage of the aggregate principal amount to the date of
payment that would otherwise be due but for the provisions of this sentence):
YEAR PERCENTAGE
- ---- ----------
1998................................................... 112.167%
1999................................................... 110.646%
2000................................................... 109.125%
2001................................................... 107.604%
2002................................................... 106.083%
The Holders of a majority in aggregate principal amount of the Notes
then outstanding by notice to the Trustee may on behalf of the Holders of all
of the Notes waive any existing Default or Event of Default and its
consequences under this Indenture except a continuing Default or Event of
Default in the payment of interest on, or the principal of, the Notes.
The Company is required to deliver to the Trustee annually a statement
regarding compliance with this Indenture, and the Company is required upon
becoming aware of any Default or Event of Default, to deliver to the Trustee a
statement specifying such Default or Event of Default.
SECTION 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision
of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
SECTION 6.04. WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the
Holders of all of the Notes waive an existing Default or Event of Default and
its consequences hereunder, except a continuing Default or Event of Default in
the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Notes (including in connection with an offer to purchase)
(provided, however, that the Holders of a majority in aggregate principal
amount of the then outstanding Notes may rescind an acceleration and its
consequences, including any related payment default that resulted from such
acceleration). Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.
SECTION 6.05. CONTROL BY MAJORITY.
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Holders of a majority in principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture that the Trustee determines may be unduly
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability.
SECTION 6.06. LIMITATION ON SUITS.
A Holder of a Note may pursue a remedy with respect to this Indenture
or the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights
of another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
SECTION 6.07. RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal, premium and Liquidated
Damages, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or
to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a) or (b) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Company for the whole amount of
principal of, premium and Liquidated Damages, if any, and interest remaining
unpaid on the Notes and interest on overdue principal and, to the extent
lawful, interest and such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable
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compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and the Holders of the Notes allowed in any judicial proceedings
relative to the Company (or any other obligor upon the Notes), its creditors or
its property and shall be entitled and empowered to collect, receive and
distribute any money or other property payable or deliverable on any such
claims and any custodian in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee, and in the event that the
Trustee shall consent to the making of such payments directly to the Holders,
to pay to the Trustee any amount due to it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel,
and any other amounts due the Trustee under Section 7.07 hereof. To the extent
that the payment of any such compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 7.07 hereof out of the estate in any such proceeding, shall be
denied for any reason, payment of the same shall be secured by a Lien on, and
shall be paid out of, any and all distributions, dividends, money, securities
and other properties that the Holders may be entitled to receive in such
proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium and Liquidated Damages, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium and Liquidated Damages, if any and
interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct. The Trustee may fix a record date and payment date
for any payment to Holders of Notes pursuant to this Section 6.10.
SECTION 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder of a
Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount of the then outstanding Notes.
SECTION 6.12. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES
AND STOCKHOLDERS
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No director, officer, employee or stockholder of the Company or any
Guarantor, as such, shall have any liability for any obligations of the Company
or any Guarantor under the Notes, the Subsidiary Guarantees, the Indenture or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder of Notes by accepting a Note waives and releases
all such liability. The waiver and release are part of the consideration for
issuance of the Notes. Such waiver may not be effective to waive liabilities
under the federal securities laws and it is the view of the SEC that such a
waiver is against public policy.
ARTICLE 7.
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture,
and use the same degree of care and skill in its exercise, as a prudent man
would exercise or use under the circumstances in the conduct of his own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the TIA and the Trustee need
perform only those duties that are specifically set forth in this
Indenture and no others, and no implied covenants or obligations shall be
read into this Indenture or the TIA against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liabilities for its own gross
negligent action, its own gross negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have offered to the Trustee
security and
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indemnity satisfactory to it against any loss, liability or expense that might
be incurred by it in compliance with such request or direction.
(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 7.02. RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon any document believed by it to
be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Company or any Guarantor shall be
sufficient if signed by an Officer of the Company or Guarantor issuing such
demand, request, direction or notice.
(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee or resign. Any Agent may do the same with
like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11
hereof.
SECTION 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
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Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes
or any other document in connection with the sale of the Notes or pursuant to
this Indenture other than its certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders of Notes a notice of
the Default or Event of Default within 90 days after it occurs. Except in the
case of a Default or Event of Default in payment of principal of, premium, if
any, or interest on any Note, the Trustee may withhold the notice if and so
long as a committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of the Holders of the Notes.
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA ss. 313(a) (but if no event described in
TIA ss. 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA
ss. 313(b)(2). The Trustee shall also transmit by mail all reports as required
by TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Notes are listed in accordance with TIA ss. 313(d). The
Company shall promptly notify the Trustee when the Notes are listed on any
stock exchange.
SECTION 7.07. COMPENSATION AND INDEMNITY.
The Company and the Guarantors shall pay to the Trustee from time to
time reasonable compensation for its acceptance of this Indenture and the
rendering by it of the services required hereunder. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Company and the Guarantors shall reimburse the Trustee promptly upon
request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses
shall include the reasonable compensation, disbursements and expenses of the
Trustee's agents and counsel.
The Company and the Guarantors shall indemnify the Trustee against any
and all losses, liabilities or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture (including, but not limited to, its duties under Section 9.06
hereof), including the costs and expenses of enforcing this Indenture against
the Company and the Guarantors (including this Section 7.07) and defending
itself against any claim (whether asserted by the Company and the Guarantors or
any Holder or any other person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent any
such loss, liability or expense may be attributable to its gross negligence or
bad faith. The Trustee shall notify the Company and the Guarantors promptly of
any claim for which it may seek indemnity.
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The obligations of the Company and the Guarantors under this Section
7.07 shall survive the satisfaction and discharge of this Indenture.
To secure the Company's and the Guarantors' payment obligations in
this Section, the Trustee shall have a Lien prior to the Notes on all money or
property held or collected by the Trustee, except that held in trust to pay
principal and interest on particular Notes. Such Lien shall survive the
satisfaction and discharge of this Indenture. Compensation, reimbursement and
indemnification of the Trustee under this Section 7.07 is not subordinated to
Senior Debt of the Company.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(i) or (j) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents
and counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to
the extent applicable.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of Notes of a
majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company may
remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office,
the Holders of a majority in principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Notes of at least 10% in principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note who has
been a Holder of a Note for at least six months, fails to comply with Section
7.10, such Holder of a Note may petition any court of competent jurisdiction
for the removal of the Trustee and the appointment of a successor Trustee.
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A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, provided
all sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.07 hereof. Notwithstanding replacement of the Trustee
pursuant to this Section 7.08, the Company's obligations under Section 7.07
hereof shall continue for the benefit of the retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall be the successor
Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or
state authorities and that has a combined capital and surplus of at least $50.0
million as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors evidenced by
a resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes and to
have each Guarantor's obligation discharged with respect to its Subsidiary
Guarantee on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance means
that the
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Company shall be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Notes, which shall thereafter be deemed to be
"outstanding" only for the purposes of Section 8.05 hereof and the other
Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all its other obligations under such Notes and this Indenture (and
the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging the same), except for the following provisions
which shall survive until otherwise terminated or discharged hereunder: (a) the
rights of Holders of outstanding Notes to receive solely from the trust fund
described in Section 8.04 hereof, and as more fully set forth in such Section,
payments in respect of the principal of and premium, interest and Liquidated
Damages, if any, on such Notes when such payments are due, (b) the Company's
obligations with respect to such Notes under Article 2 and Section 4.02 hereof,
(c) the rights, powers, trusts, duties and immunities of the Trustee hereunder
and the Company's obligations in connection therewith and (d) this Article 8.
Subject to compliance with this Article 8, the Company may exercise its option
under this Section 8.02 notwithstanding the prior exercise of its option under
Section 8.03 hereof.
SECTION 8.03. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and each Guarantor shall, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, be
released from their obligations under the covenants contained in Sections 4.07,
4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18, 4.19, 4.20, 5.01
and 11.01 hereof with respect to the outstanding Notes on and after the date
the conditions set forth in Section 8.04 are satisfied (hereinafter, "Covenant
Defeasance"), and the Notes shall thereafter be deemed not "outstanding" for
the purposes of any direction, waiver, consent or declaration or act of Holders
(and the consequences of any thereof) in connection with such covenants, but
shall continue to be deemed "outstanding" for all other purposes hereunder (it
being understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to
the outstanding Notes, the Company and each Guarantor may omit to comply with
and shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference
in any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a Default or an Event of Default
under Section 6.01 hereof, but, except as specified above, the remainder of
this Indenture and such Notes shall be unaffected thereby. In addition, upon
the Company's exercise under Section 8.01 hereof of the option applicable to
this Section 8.03 hereof, subject to the satisfaction of the conditions set
forth in Section 8.04 hereof, Sections 6.01(d) through 6.01(f) hereof shall not
constitute Events of Default.
SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust, for
the benefit of the Holders, cash in United States dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent
public accountants, to pay the principal of, premium and Liquidated Damages, if
any, and interest on the outstanding Notes on the stated date for payment
thereof or on the applicable redemption date, as the case may be, and the
Company must specify whether the Notes are being defeased to maturity or to a
particular redemption date;
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(b) in the case of an election under Section 8.02 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income
tax purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.03 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income
tax purposes as a result of such Covenant Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of
Default resulting from the incurrence of Indebtedness all or a portion of the
proceeds of which will be used to defease the Notes pursuant to this Article 8
concurrently with such incurrence) or insofar as Sections 6.01(i) or 6.01(j)
hereof is concerned, at any time in the period ending on the 91st day after the
date of deposit (or greater period of time in which any such deposit of trust
funds may remain subject to bankruptcy or insolvency laws insofar as those
apply to the deposit by the Company);
(e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any material agreement
or instrument (other than this Indenture) to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;
(f) the Company shall have delivered to the Trustee an Opinion of
Counsel (which may be subject to customary exceptions) to the effect that (A)
on the 91st day following the deposit (or greater period of time in which any
such deposit of trust funds may remain subject to bankruptcy or insolvency laws
insofar as those apply to the deposit by the Company), the trust funds will not
be subject to the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally and (B)
the trust funds will not be subject to the rights of holders of Indebtedness
other than the Notes;
(g) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the
intent of preferring the Holders over any other creditors of the Company or
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company or others; and
(h) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
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Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but
such money need not be segregated from other funds except to the extent
required by law.
The Company and the Guarantors shall pay and indemnify the Trustee
against any tax, fee or other charge imposed on or assessed against the cash or
non-callable Government Securities deposited pursuant to Section 8.04 hereof or
the principal and interest received in respect thereof other than any such tax,
fee or other charge which by law is for the account of the Holders of the
outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.04(a) hereof), are in excess of the amount thereof
that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.
SECTION 8.06. REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, premium, if any,
or interest on any Note and remaining unclaimed for two years after such
principal, and premium, if any, or interest has become due and payable shall be
paid to the Company on its request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as a
secured 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;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Company cause to be
published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
notification or publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
SECTION 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02
or 8.03 hereof, as the case may be, by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company's obligations under this Indenture and the
Notes shall be revived and reinstated as though no deposit had occurred
pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or
Paying Agent is permitted to apply all such money in accordance with Section
8.02 or 8.03 hereof, as the case may be; provided, however, that, if the
Company makes any payment of principal of, premium, if any, or interest on any
Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Notes to receive such payment
from the money held by the Trustee or Paying Agent.
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ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, the Company, a
Guarantor (with respect to a Subsidiary Guarantee or this Indenture to which it
is a party) and the Trustee may amend or supplement this Indenture, the
Subsidiary Guarantee or the Notes without the consent of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article 2 hereof (including
the related definitions) in a manner that does not materially adversely affect
any Holder;
(c) to provide for the assumption of the Company's or a Guarantor's
obligations to the Holders of the Notes by a successor to the Company or a
Guarantor pursuant to Article 5 or Article 11 hereof;
(d) to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the
legal rights hereunder of any Holder of the Notes;
(e) to comply with requirements of the SEC in order to effect or maintain
the qualification of this Indenture under the TIA;
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02 hereof, the Trustee shall join with the Company and
the Guarantors in the execution of any amended or supplemental Indenture
authorized or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into such amended or supplemental
Indenture that affects its own rights, duties or immunities under this
Indenture or otherwise.
SECTION 9.02. WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture (including Section 3.09, 4.10
and 4.15 hereof) , the Subsidiary Guarantees and the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the Notes then outstanding voting as a single class
(including consents obtained in connection with a tender offer or exchange
offer for, or purchase of, the Notes), and, subject to Sections 6.04 and 6.07
hereof, any existing Default or Event of Default (other than a Default or Event
of Default in the payment of the principal of, premium, if any, or interest on
the Notes, except a payment default resulting from an acceleration that has
been rescinded) or compliance with any provision of this Indenture, the
Subsidiary Guarantees or the Notes may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Notes voting
as a single class (including consents obtained in connection with a tender
offer or exchange offer for, or purchase of, the Notes). Section 2.08 hereof
shall determine which Notes are considered to be "outstanding" for purposes of
this Section 9.02.
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Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in
Section 7.02 hereof, the Trustee shall join with the Company in the execution
of such amended or supplemental Indenture unless such amended or supplemental
Indenture directly affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise, in which case the Trustee may in its discretion,
but shall not be obligated to, enter into such amended or supplemental
Indenture.
It shall not be necessary for the consent of the Holders of Notes
under this Section 9.02 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount of the Notes then outstanding voting as
a single class may waive compliance in a particular instance by the Company
with any provision of this Indenture or the Notes. However, without the consent
of each Holder affected, an amendment or waiver under this Section 9.02 may not
(with respect to any Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent to an
amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note or
alter or waive any of the provisions with respect to the redemption of the
Notes except as provided above with respect to Sections 3.09, 4.10 and 4.15
hereof;
(c) reduce the rate of or change the time for payment of interest on any
Note;
(d) waive a Default or Event of Default in the payment of principal of or
premium, interest or Liquidated Damages, if any, on the Notes (except a
rescission of acceleration of the Notes by the Holders of at least a majority
in aggregate principal amount of the then outstanding Notes and a waiver of the
payment default that resulted from such acceleration);
(e) make any Note payable in money other than that stated in the Notes;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of principal of or premium, interest or Liquidated Damages, if any, on the
Notes;
(g) waive a redemption payment with respect to any Note (other than a
payment required by one of the covenants described in Sections 4.10 and 4.15).
(h) release any Guarantor from its Subsidiary Guarantee; or
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(i) make any change in Section 6.04 or 6.07 hereof or in the foregoing
amendment and waiver provisions.
In addition, any amendment to the provisions of Article 10 of this
Indenture (which relate to subordination) will require the consent of the
Holders of at least 75% in aggregate principal amount of the Notes then
outstanding if such amendment would adversely affect the rights of Holders of
Notes.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes shall be
set forth in a amended or supplemental Indenture that complies with the TIA as
then in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment
becomes effective. An amendment, supplement or waiver becomes effective in
accordance with its terms and thereafter binds every Holder.
SECTION 9.05. NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Company may not sign an amendment or supplemental Indenture until the Board
of Directors approves it. In executing any amended or supplemental indenture,
the Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
shall be fully protected in relying upon, in addition to the documents required
by Section 12.04 hereof, an Officers' Certificate and an Opinion of Counsel
stating that (i) the execution of such amended or supplemental indenture is
authorized or permitted by this Indenture, (ii) such amended or supplemental
indenture complies with this Indenture and, (iii) in the event that such
amendment or supplemental indenture is being executed pursuant to Section 5.01
or 11.01 hereof, the surviving Person assumes the Obligations of this Indenture
and the Notes.
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ARTICLE 10.
SUBORDINATION
SECTION 10.01. AGREEMENT TO SUBORDINATE.
The Company and the Guarantors agree, and each Holder by accepting a
Note agrees, that the Indebtedness evidenced by the Notes is subordinated in
right of payment, to the extent and in the manner provided in this Article 10,
to the prior payment in full in cash or Cash Equivalents of all Senior Debt
(whether outstanding on the date hereof or hereafter created, incurred, assumed
or guaranteed), and that the subordination is for the benefit of the holders of
Senior Debt.
SECTION 10.02. CERTAIN DEFINITIONS.
"Designated Senior Debt" means (i) any Indebtedness outstanding under
the Senior Credit Facility and (ii) any other Senior Debt or Guarantor Senior
Debt permitted under this Indenture the principal amount of which is $25.0
million or more and that has been designated by the Company as "Designated
Senior Debt."
"Permitted Junior Securities" means Equity Interests in the Company or
debt securities of the Company or the relevant Guarantor that are subordinated
to all Senior Debt (and any debt securities issued in exchange for Senior Debt)
or Guarantor Senior Debt (and any debt securities issued in exchange for
Guarantor Senior Debt), as applicable, to substantially the same extent as, or
to a greater extent than, the Notes are subordinated to Senior Debt or the
Subsidiary Guarantees are subordinated to Guarantor Senior Debt, as applicable,
pursuant to this Indenture.
"Representative" means the indenture trustee or other trustee, agent
or representative for any Senior Debt.
"Senior Debt" means (i) all Indebtedness outstanding under Credit
Facilities and all Hedging Obligations with respect thereto, (ii) any other
Indebtedness of the Company or any Guarantor permitted to be incurred under the
terms of this Indenture, unless the instrument under which such Indebtedness is
incurred expressly provides that it is on a parity with or subordinated in
right of payment to the Notes or the Subsidiary Guarantees and (iii) all
Obligations of the Company or any Guarantor with respect to the foregoing.
Notwithstanding anything to the contrary in the foregoing, Senior Debt will not
include (a) any liability for federal, state, local or other taxes owed or
owing by the Company, (b) any Indebtedness of the Company or any Guarantor to
any of its Subsidiaries or other Affiliates, (c) any trade payables or (d) any
Indebtedness that is incurred in violation of this Indenture; provided that
Indebtedness under Credit Facilities will not cease to be Senior Debt if
borrowed based upon a written certificate from a purported officer of the
Company to the effect that such Indebtedness was permitted by this Indenture to
be incurred.
A distribution may consist of cash, securities or other property, by
set-off or otherwise.
SECTION 10.03. LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any distribution to creditors of the Company in a liquidation or
dissolution of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the
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Company or its property, in an assignment for the benefit of creditors or any
marshaling of the Company's assets and liabilities:
(1) holders of Senior Debt shall be entitled to receive payment in
full in cash or Cash Equivalents of all Obligations due in respect of such
Senior Debt (including interest after the commencement of any such proceeding
at the rate specified in the applicable Senior Debt) before Holders of the
Notes shall be entitled to receive any payment with respect to the Notes
(except that Holders may receive (i) Permitted Junior Securities and (ii)
payments and other distributions made from any defeasance trust created
pursuant to Section 8.01 hereof); and
(2) until all Obligations with respect to Senior Debt (as provided in
subsection (1) above) are paid in full in cash or Cash Equivalents, any
distribution to which the Holders of Notes would be entitled but for this
Article 10 shall be made to holders of Senior Debt (except that Holders of
Notes may receive (i) Permitted Junior Securities and (ii) payments and other
distributions made from any defeasance trust created pursuant to Section 8.01
hereof), as their interests may appear.
SECTION 10.04. DEFAULT ON DESIGNATED SENIOR DEBT.
The Company may not make any payment or distribution to the Trustee or
any Holder in respect of Obligations with respect to the Notes and may not
acquire from the Trustee or any Holder any Notes for cash or property (other
than (i) Permitted Junior Securities and (ii) payments and other distributions
made from any defeasance trust created pursuant to Section 8.01 hereof) until
all principal and other Obligations with respect to the Senior Debt have been
paid in full if:
(i) a default in the payment of any principal or other Obligations
with respect to Designated Senior Debt occurs and is continuing beyond any
applicable grace period in the agreement, indenture or other document
governing such Designated Senior Debt; or
(ii) a default, other than a payment default, on Designated Senior
Debt occurs and is continuing that then permits holders of the Designated
Senior Debt to accelerate its maturity and the Trustee receives a notice of
the default (a "Payment Blockage Notice") from a Person who may give it
pursuant to Section 10.12 hereof. If the Trustee receives any such Payment
Blockage Notice, no subsequent Payment Blockage Notice shall be effective
for purposes of this Section unless and until (i) at least 360 days shall
have elapsed since the effectiveness of the immediately prior Payment
Blockage Notice and (ii) all scheduled payments of principal, premium, if
any, and interest on the Securities that have come due have been paid in
full in cash. No nonpayment default that existed or was continuing on the
date of delivery of any Payment Blockage Notice to the Trustee shall be, or
be made, the basis for a subsequent Payment Blockage Notice.
The Company may and shall resume payments on and distributions in
respect of the Notes and may acquire them upon the earlier of:
(1) the date upon which the default is cured or waived, or
(2) in the case of a default referred to in Section 10.04(ii) hereof,
179 days after notice is received if the maturity of such Designated Senior
Debt has not been accelerated,
if this Article 10 otherwise permits the payment, distribution or
acquisition at the time of such payment or acquisition.
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SECTION 10.05. ACCELERATION OF SECURITIES.
If payment of the Securities is accelerated because of an Event of
Default, the Company shall promptly notify holders of Senior Debt of the
acceleration.
SECTION 10.06. WHEN DISTRIBUTION MUST BE PAID OVER.
In the event that the Trustee or any Holder receives any payment of
any Obligations with respect to the Notes at a time when the Trustee or such
Holder, as applicable, has actual knowledge that such payment is prohibited by
Section 10.04 hereof, such payment shall be held by the Trustee or such Holder,
in trust for the benefit of, and shall be paid forthwith over and delivered,
upon written request, to, the holders of Senior Debt as their interests may
appear or their Representative under the indenture or other agreement (if any)
pursuant to which Senior Debt may have been issued, as their respective
interests may appear, for application to the payment of all Obligations with
respect to Senior Debt remaining unpaid to the extent necessary to pay such
Obligations in full in accordance with their terms, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Debt.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform only such obligations on the part of the Trustee as are specifically
set forth in this Article 10, and no implied covenants or obligations with
respect to the holders of Senior Debt shall be read into this Indenture against
the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt, and shall not be liable to any such holders if the
Trustee shall pay over or distribute to or on behalf of Holders or the Company
or any other Person money or assets to which any holders of Senior Debt shall
be entitled by virtue of this Article 10, except if such payment is made as a
result of the willful misconduct or gross negligence of the Trustee.
SECTION 10.07. NOTICE BY COMPANY.
The Company shall promptly notify the Trustee and the Paying Agent of
any facts known to the Company that would cause a payment of any Obligations
with respect to the Notes to violate this Article 10, but failure to give such
notice shall not affect the subordination of the Notes to the Senior Debt as
provided in this Article 10.
SECTION 10.08. SUBROGATION.
After all Senior Debt is paid in full and until the Notes are paid in
full, Holders of Notes shall be subrogated (equally and ratably with all other
Indebtedness pari passu with the Notes) to the rights of holders of Senior Debt
to receive distributions applicable to Senior Debt to the extent that
distributions otherwise payable to the Holders of Notes have been applied to
the payment of Senior Debt. A distribution made under this Article 10 to
holders of Senior Debt that otherwise would have been made to Holders of Notes
is not, as between the Company and Holders, a payment by the Company on the
Notes.
SECTION 10.09. RELATIVE RIGHTS.
This Article 10 defines the relative rights of Holders of Notes and
holders of Senior Debt. Nothing in this Indenture shall:
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(1) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Notes in accordance with their terms;
(2) affect the relative rights of Holders of Notes and creditors of
the Company other than their rights in relation to holders of Senior Debt; or
(3) prevent the Trustee or any Holder of Notes from exercising its
available remedies upon a Default or Event of Default, subject to the rights of
holders and owners of Senior Debt to receive distributions and payments
otherwise payable to Holders of Notes.
If the Company fails because of this Article 10 to pay principal of or
interest on a Note on the due date, the failure is still a Default or Event of
Default.
SECTION 10.10. SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY.
No right of any holder of Senior Debt to enforce the subordination of
the Indebtedness evidenced by the Notes shall be impaired by any act or failure
to act by the Company or any Holder or by the failure of the Company or any
Holder to comply with this Indenture.
SECTION 10.11. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of
Senior Debt, the distribution may be made and the notice given to their
Representative.
Upon any payment or distribution of assets of the Company referred to
in this Article 10, the Trustee and the Holders of Notes shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such Representative or of the liquidating trustee or
agent or other Person making any distribution to the Trustee or to the Holders
of Notes for the purpose of ascertaining the Persons entitled to participate in
such distribution, the holders of the Senior Debt and other Indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article
10.
SECTION 10.12. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding the provisions of this Article 10 or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the Paying Agent may continue
to make payments on the Notes, unless the Trustee shall have received at its
Corporate Trust Office at least five Business Days prior to the date of such
payment written notice of facts that would cause the payment of any Obligations
with respect to the Notes to violate this Article 10. Only the Company or a
Representative may give the notice. Nothing in this Article 10 shall impair the
claims of, or payments to, the Trustee under or pursuant to Section 7.07
hereof.
The Trustee in its individual or any other capacity may hold Senior
Debt with the same rights it would have if it were not Trustee. Any Agent may
do the same with like rights.
SECTION 10.13. AUTHORIZATION TO EFFECT SUBORDINATION.
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Each Holder of Notes, by the Holder's acceptance thereof, authorizes
and directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article 10, and appoints the Trustee to act as such Holder's attorney-in-fact
for any and all such purposes. If the Trustee does not file a proper proof of
claim or proof of debt in the form required in any proceeding referred to in
Section 6.09 hereof at least 30 days before the expiration of the time to file
such claim, the Credit Agents are hereby authorized to file an appropriate
claim for and on behalf of the Holders of the Notes.
SECTION 10.14. AMENDMENTS.
The provisions of this Article 10 shall not be amended or modified
without the written consent of the holders of all Senior Debt.
ARTICLE 11.
SUBSIDIARY GUARANTEES
SECTION 11.01. GUARANTEE.
Subject to this Article 11, each of the Guarantors hereby, jointly and
severally, unconditionally guarantees to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of this Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that: (a) the principal
of and interest on the Notes will be promptly paid in full when due, whether at
maturity, by acceleration, redemption or otherwise, and interest on the overdue
principal of and interest on the Notes, if any, if lawful, and all other
obligations of the Company to the Holders or the Trustee hereunder or
thereunder will be promptly paid in full or performed, all in accordance with
the terms hereof and thereof; and (b) in case of any extension of time of
payment or renewal of any Notes or any of such other obligations, that same
will be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by acceleration
or otherwise. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors shall be jointly
and severally obligated to pay the same immediately. Each Guarantor agrees that
this is a guarantee of payment and not a guarantee of collection.
The Guarantors hereby agree that their obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of
the Notes or this Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute
a legal or equitable discharge or defense of a guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands
whatsoever and covenant that this Note Guarantee shall not be discharged except
by complete performance of the obligations contained in the Notes and this
Indenture.
If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Guarantors or any custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.
- 70 -
<PAGE>
Each Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6
hereof for the purposes of this Subsidiary Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any declaration of
acceleration of such obligations as provided in Article 6 hereof, such
obligations (whether or not due and payable) shall forthwith become due and
payable by the Guarantors for the purpose of this Subsidiary Guarantee. The
Guarantors shall have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights of
the Holders under the Guarantee.
SECTION 11.02. SUBORDINATION OF SUBSIDIARY GUARANTEE.
The Obligations of each Guarantor under its Subsidiary Guarantee
pursuant to this Article 11 shall be junior and subordinated to the Senior Debt
of such Guarantor on the same basis as the Notes are junior and subordinated to
Senior Debt of the Company. For the purposes of the foregoing sentence, the
Trustee and the Holders shall have the right to receive and/or retain payments
by any of the Guarantors only at such times as they may receive and/or retain
payments in respect of the Notes pursuant to this Indenture, including Article
10 hereof.
SECTION 11.03. LIMITATION ON GUARANTOR LIABILITY.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Subsidiary
Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance
for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or state law to the
extent applicable to any Subsidiary Guarantee. To effectuate the foregoing
intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree
that the obligations of such Guarantor under its Subsidiary Guarantee and this
Article 11 shall be limited to the maximum amount as will, after giving effect
to such maximum amount and all other contingent and fixed liabilities of such
Guarantor that are relevant under such laws, and after giving effect to any
collections from, rights to receive contribution from or payments made by or on
behalf of any other Guarantor in respect of the obligations of such other
Guarantor under this Article 11, result in the obligations of such Guarantor
under its Subsidiary Guarantee not constituting a fraudulent transfer or
conveyance.
SECTION 11.04. EXECUTION AND DELIVERY OF NOTE GUARANTEE.
To evidence its Subsidiary Guarantee set forth in Section 11.01, each
Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form included in Exhibit E shall be endorsed by an Officer
of such Guarantor on each Note authenticated and delivered by the Trustee and
that this Indenture shall be executed on behalf of such Guarantor by its
President or one of its Vice Presidents.
Each Guarantor hereby agrees that its Subsidiary Guarantee set forth
in Section 11.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Subsidiary a notation of such Subsidiary Guarantee.
If an Officer whose signature is on this Indenture or on the
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.
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<PAGE>
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Subsidiary Guarantee
set forth in this Indenture on behalf of the Guarantors.
In the event that the Company creates or acquires any new domestic
Restricted Subsidiaries subsequent to the date of this Indenture, if required
by Section 4.20 hereof, the Company shall cause such domestic Restricted
Subsidiaries to execute supplemental indentures to this Indenture in the form
included in Exhibit F and Subsidiary Guarantees in the form included in Exhibit
E in accordance with Section 4.20 hereof and this Article 11, to the extent
applicable.
SECTION 11.05. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
No Guarantor may consolidate with or merge with or into (whether or
not such Guarantor is the surviving Person) another corporation, Person or
entity whether or not affiliated with such Guarantor unless:
(a) subject to the provisions of Section 11.06 hereof, the Person formed
by or surviving any such consolidation or merger (if other than a Guarantor)
assumes all the obligations of such Guarantor pursuant to a supplemental
indenture in form and substance reasonably satisfactory to the Trustee, under
the Notes, the Indenture and the Registration Rights Agreement;
(b) immediately after giving effect to such transaction, no Default or
Event of Default exists; and
(c) the Company would be permitted by virtue of the Company's pro forma
Debt to Cash Flow Ratio, immediately after giving effect to such transaction,
to incur at least $1.00 of additional Indebtedness pursuant to the Debt to Cash
Flow Ratio test set forth in Section 4.09 hereof.
In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the
Subsidiary Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Guarantor, such successor Person shall succeed to and be
substituted for the Guarantor with the same effect as if it had been named
herein as a Guarantor. Such successor Person thereupon may cause to be signed
any or all of the Subsidiary Guarantees to be endorsed upon all of the Notes
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee. All the Subsidiary Guarantees so issued shall in
all respects have the same legal rank and benefit under this Indenture as the
Subsidiary Guarantees theretofore and thereafter issued in accordance with the
terms of this Indenture as though all of such Subsidiary Guarantees had been
issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes shall prevent any consolidation or merger of a Guarantor with or into the
Company or another Guarantor, or shall prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an entirety to the
Company or another Guarantor.
SECTION 11.06. RELEASES FOLLOWING SALE OF ASSETS.
In the event of a sale or other disposition of all of the assets of
any Guarantor, by way of merger, consolidation or otherwise, or a sale or other
disposition of all of the capital stock of any Guarantor, then such Guarantor
(in the event of a sale or other disposition, by way of merger, consolidation
or otherwise,
- 72 -
<PAGE>
of all of the capital stock of such Guarantor) or the corporation acquiring the
property (in the event of a sale or other disposition of all or substantially
all of the assets of such Guarantor) will be released and relieved of any
obligations under its Subsidiary Guarantee; provided that the Net Proceeds of
such sale or other disposition are applied in accordance with the applicable
provisions of this Indenture, including without limitation Section 4.10 hereof.
Upon delivery by the Company to the Trustee of an Officers' Certificate and an
Opinion of Counsel to the effect that such sale or other disposition was made
by the Company in accordance with the applicable provisions of this Indenture,
including without limitation Section 4.10 hereof, the Trustee shall execute any
documents reasonably required in order to evidence the release of any Guarantor
from its obligations under its Subsidiary Guarantee.
Any Guarantor not released from its obligations under its Subsidiary
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under this
Indenture as provided in this Article 11.
ARTICLE 12.
MISCELLANEOUS
SECTION 12.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by a provision of the TIA or another provision that would be
required or deemed under the TIA to be part of and govern this Indenture if
this Indenture were subject thereto, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the TIA that
may be so modified or excluded, the later provision shall be deemed to apply to
this Indenture as so modified or to be excluded, as the case may be.
SECTION 12.02. NOTICES.
Any notice or communication by the Company, any Guarantor or the
Trustee to the others is duly given if in writing and delivered in Person or
mailed by first class mail, telecopier or overnight air courier guaranteeing
next day delivery, to the others' address:
If to the Company and/or any Guarantor:
SFX Entertainment, Inc.
650 Madison Avenue
New York, New York 10022
Telecopier No.: (212) 753-3188
Attention: Howard J. Tytel, Esq.
With a copy to:
Baker & McKenzie
805 Third Avenue
New York, New York 10022
Telecopier No. (212) 751-5700
Attention: Howard Berkower, Esq.
If to the Trustee:
- 73 -
<PAGE>
The Chase Manhattan Bank
450 West 33rd Street
15th Floor
New York, New York 10001
Telecopier No.: (212) 946-8158
Attention: Ms. Francine Springer, Corporate Trust Department
The Company, any Guarantor or the Trustee, by notice to the others may
designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail or by overnight air courier guaranteeing next day delivery to its address
shown on the register kept by the Registrar. Any notice or communication shall
also be so mailed to any Person described in TIA ss. 313(c), to the extent
required by the TIA. Failure to mail a notice or communication to a Holder or
any defect in it shall not affect its sufficiency with respect to other
Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
SECTION 12.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company,
the Trustee, the Registrar and anyone else shall have the protection of TIA ss.
312(c).
SECTION 12.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 12.05
hereof) stating that, in the opinion of the signers, all conditions precedent
and covenants, if any, provided for in this Indenture relating to the proposed
action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory to
the Trustee (which shall include the statements set forth in Section 12.05
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
- 74 -
<PAGE>
SECTION 12.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA
ss. 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been satisfied.
SECTION 12.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
SECTION 12.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No past, present or future director, officer, employee, incorporator
or stockholder of the Company or any Guarantor, as such, shall have any
liability for any obligations of the Company or such Guarantor under the Notes,
the Subsidiary Guarantees, this Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes.
SECTION 12.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 12.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person.
Any such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 12.10. SUCCESSORS.
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<PAGE>
All agreements of the Company in this Indenture and the Notes shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors.
SECTION 12.11. SEVERABILITY.
In case any provision in this Indenture or in the Notes shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
SECTION 12.12. COUNTERPART ORIGINALS.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
SECTION 12.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
- 76 -
<PAGE>
SIGNATURES
Dated as of February 11, 1998
SFX ENTERTAINMENT, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: General Counsel, Executive
Vice President and Secretary
ATLANTA CONCERTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
ARDEE FESTIVALS N.J., INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
ARDEE PRODUCTIONS, LTD.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
BEACH CONCERTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
Indenture signature page - 1
<PAGE>
BGP ACQUISITION, LLC
By: SFX ENTERTAINMENT, INC.,
its managing member.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: General Counsel, Executive
Vice President and Secretary
BROADWAY CONCERTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONNECTICUT AMPHITHEATER DEVELOPMENT CORP.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONNECTICUT CONCERTS, INCORPORATED
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONNECTICUT PERFORMING ARTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
Indenture signature page - 2
<PAGE>
CONNECTICUT PERFORMING ARTS PARTNERS
By: NOC, INC. its general partner.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONN TICKETING COMPANY
By: NORTHEAST TICKETING COMPANY,
its general partner.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONTEMPORARY GROUP ACQUISITION CORP.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
DEER CREEK AMPHITHEATER CONCERTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
DEER CREEK AMPHITHEATER CONCERTS, LP
By: DEER CREEK AMPHITHEATER CONCERTS, INC.,
its general partner.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
Indenture signature page - 3
<PAGE>
DELSENER/SLATER ENTERPRISES, LTD.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
DUMB DEAL, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
EXIT 116 REVISITED, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
FPI CONCERTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
IN HOUSE TICKETS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
IRVING PLAZA CONCERTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Agent
Indenture signature page - 4
<PAGE>
MURAT CENTER CONCERTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
MURAT CENTER CONCERTS, LP
By: MURAT CENTER CONCERTS, INC.,
its managing partner.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
NOC, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
NORTHEAST TICKETING COMPANY
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
POLARIS AMPHITHEATER CONCERTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
Indenture signature page - 5
<PAGE>
QN CORP.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SFX BROADCASTING OF THE MIDWEST, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SFX CONCERTS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SFX NETWORK GROUP, LLC
By: SFX ENTERTAINMENT, INC.,
its managing member.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: General Counsel, Executive
Vice President and Secretary
SOUTHEAST TICKETING COMPANY
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
Indenture signature page - 6
<PAGE>
SUNSHINE CONCERTS, LLC
By: SFX BROADCASTING OF THE MIDWEST, INC.,
its managing member.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SUNSHINE DESIGNS, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SUNSHINE DESIGNS, LP
By: SUNSHINE DESIGNS, INC., its general
partner.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SUNTEX ACQUISITION, INC.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SUNTEX ACQUISITION, LP
By: SUNTEX ACQUISITION, INC., its general
partner.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
Indenture signature page - 7
<PAGE>
WESTBURY MUSIC FAIR, LLC
By: SFX ENTERTAINMENT, INC.,
its managing member.
By: /s/ Howard J. Tytel
-------------------------------------
Name: Howard J. Tytel
Title: General Counsel, Executive Vice
President and Secretary
THE CHASE MANHATTAN BANK
By: /s/ Francine Springer
-------------------------------------
Name: Francine Springer
Title: Assistant Vice President
Indenture signature page - 8
<PAGE>
EXHIBIT A1
(Face of Note)
[THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE
MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF THE COMPANY.]1
[THE NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY HAS NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT") OR ANY STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR
SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF,
THE HOLDER: REPRESENTS THAT (1) IT IS (A) A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) NOT A U.S. PERSON AND IS
ACQUIRING THE NOTE EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION; (2) AGREES THAT
IT WILL NOT RESELL OR OTHERWISE TRANSFER THE NOTE EVIDENCED HEREBY EXCEPT TO
(A) THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) A QUALIFIED INSTITUTIONAL BUYER
IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) AN INSTITUTIONAL
ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE CHASE
MANHATTAN BANK, AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE), A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE NOTE EVIDENCED HEREBY (THE FORM OF WHICH LETTER
CAN BE OBTAINED FROM SUCH TRUSTEE OR A SUCCESSOR TRUSTEE, AS APPLICABLE), (D)
OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT,
(E) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE) OR IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (F) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND, IN EACH CASE, IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR ANY OTHER
APPLICABLE JURISDICTION; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO
WHOM THE NOTE EVIDENCED HEREBY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. IF THE PROPOSED TRANSFER IS PURSUANT TO CLAUSE (C), (D)
OR (E) ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE CHASE
MANHATTAN BANK, AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS IT MAY REASONABLY
REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. AS USED
- --------
1 This paragraph should be included only if Note is issues in global form.
A1-1
<PAGE>
HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON"
HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.]2
CUSIP/CINS ___________
9-1/8% Series A Senior Subordinated Notes due 2008
No. ____ $_________
SFX ENTERTAINMENT, INC.
promises to pay to ______________________________________________________ or
registered assigns, the principal sum of
______________________________________________________Dollars on ___________,
2008.
Interest Payment Dates: ____________, and ____________.
Record Dates: ____________, and _______________.
Dated: _____________________, 1998
SFX ENTERTAINMENT, INC.
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
This is one of the Global Notes referred to in the within-mentioned Indenture:
The Chase Manhattan Bank,
as Trustee
By:
--------------------------
- ---------
2 This paragraph should be included only if applicable pursuant to terms of
the Indenture.
A1-2
<PAGE>
(Reverse face of Note)
9-1/8% Series A Senior Subordinated Notes due 2008
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. SFX Entertainment, a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note at
9-1/8% per annum from February 11, 1998 until maturity and shall pay the
Liquidated Damages payable pursuant to Section 5 of the Registration Rights
Agreement referred to below. The Company will pay interest and Liquidated
Damages semi-annually on February 1 and August 1 of each year, or if any such
day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest on the Notes will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from the date of issuance; provided that if there is no existing Default in the
payment of interest, and if this Note is authenticated between a record date
referred to on the face hereof and the next succeeding Interest Payment Date,
interest shall accrue from such next succeeding Interest Payment Date;
provided, further, that the first Interest Payment Date shall be August 1,
1998. The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any,
from time to time on demand at a rate that is 1% per annum in excess of the
rate then in effect; it shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue installments of interest
and Liquidated Damages (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages to the Persons who are
registered Holders of Notes at the close of business on the January 15 or July
15 next preceding the Interest Payment Date, even if such Notes are canceled
after such record date and on or before such Interest Payment Date, except as
provided in Section 2.12 of the Indenture with respect to defaulted interest.
The Notes will be payable as to principal, premium and Liquidated Damages, if
any, and interest at the office or agency of the Company maintained for such
purpose within or without the City and State of New York, or, at the option of
the Company, payment of interest and Liquidated Damages may be made by check
mailed to the Holders at their addresses set forth in the register of Holders,
and provided that payment by wire transfer of immediately available funds will
be required with respect to principal of and interest, premium and Liquidated
Damages on, all Global Notes and all other Notes the Holders of which shall
have provided wire transfer instructions to the Company or the Paying Agent.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.
3. PAYING AGENT AND REGISTRAR. Initially, The Chase Manhattan Bank,
the Trustee under the Indenture, will act as Paying Agent and Registrar. The
Company may change any Paying Agent or Registrar without notice to any Holder.
The Company or any of its Subsidiaries may act in any such capacity.
4. INDENTURE. The Company issued the Notes under an Indenture dated as
of February 11, 1998 ("Indenture") between the Company and the Trustee. The
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code ss.ss. 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. To the extent any provision of this Note conflicts
A1-3
<PAGE>
with the express provisions of the Indenture, the provisions of the indenture
shall govern and be controlling. The Notes are obligations of the Company
limited to $350.0 million in aggregate principal amount.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 5, the Company
shall not have the option to redeem the Notes pursuant to this Section 5 prior
to February 1, 2003. Thereafter, the Company shall have the option to redeem
the Notes, in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest and Liquidated Damages, if
any, thereon to the applicable redemption date, if redeemed during the
twelve-month period beginning on February 1 of the years indicated below:
YEAR PERCENTAGE
---- ----------
2003.............................................. 104.563%
2004.............................................. 103.042%
2005.............................................. 101.521%
2006 and thereafter............................... 100.000%
(b) Notwithstanding the foregoing, prior to February 1, 2001, the
Company may, on any one or more occasions, redeem up to 35% of the aggregate
principal amount of Notes originally issued in the Offering at a redemption
price of 109.125% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the redemption date, with
the net cash proceeds of an offering of common equity of the Company (other
than Disqualified Stock); provided that (i) at least 65% of the aggregate
principal amount of the Notes originally issued in the Offering remain
outstanding immediately after the occurrence of each such redemption (excluding
Notes held by the Company and its Subsidiaries) and (ii) each such redemption
shall occur within 75 days after the date of the closing of any such offering
of common equity of the Company.
6. MANDATORY REDEMPTION.
Except as set forth in paragraph 7 below, the Company shall not be
required to make mandatory redemption or sinking fund payments with respect to
the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be obligated to
make an offer (a "Change of Control Offer") to each Holder of Notes to
repurchase all or any part (equal to $1,000 or an integral multiple thereof) of
such Holder's Notes at an offer price in cash equal to 101% of the principal
amount thereof, plus accrued and unpaid interest and Liquidated Damages, if
any, thereon to the date of purchase (the "Change of Control Payment"). Within
ten days following a Change of Control, the Company will mail a notice to each
Holder describing the transaction or transactions that constitute the Change of
Control and offering to repurchase Notes on the date specified in such notice,
which date shall be no earlier than 30 days and no later than 60 days from the
date such notice is mailed (the "Change of Control Payment Date"), pursuant to
the procedures required by the Indenture and described in such notice.
(b) If the Company or a Subsidiary consummates any Asset Sales, when
the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company
shall be required to make an offer to all Holders of Notes and all holders of
other pari passu Indebtedness containing provisions similar to those
A1-4
<PAGE>
set forth in the Indenture with respect to offers to purchase or redeem such
other pari passu Indebtedness with the proceeds of sales of assets (an "Asset
Sale Offer") to purchase the maximum principal amount of Notes and such other
pari passu Indebtedness that may be purchased out of the Excess Proceeds at an
offer price in cash in an amount equal to 100% of the principal amount thereof,
plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the
date of purchase, in accordance with the procedures set forth in the Indenture
and in such other pari passu Indebtedness. To the extent that the aggregate
amount of Notes and such other pari passu Indebtedness tendered pursuant to an
Asset Sale Offer is less than the Excess Proceeds, the Company may use any
remaining Excess Proceeds for any purpose not otherwise prohibited by the
Indenture. If the aggregate principal amount of Notes and such other pari passu
Indebtedness surrendered by Holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis. Upon completion of an Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at least
30 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes
or portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000.
The transfer of Notes may be registered and Notes may be exchanged as provided
in the Indenture. The Registrar and the Trustee may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and
the Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a
record date and the corresponding Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture , the Subsidiary Guarantees or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Notes voting as a single class
(including without limitation, consents obtained in connection with a purchase
of, or tender offer or exchange offer for, Notes), and any existing default or
compliance with any provision of the Indenture, the Subsidiary Guarantees or
the Notes may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes voting as a single class
(including consents obtained in connection with a tender offer or exchange
offer for Notes). Without the consent of any Holder of Notes, the Indenture,
the Subsidiary Guarantees or the Notes may be amended or supplemented to cure
any ambiguity, defect or inconsistency, to provide for uncertificated Notes in
addition to or in place of certificated Notes, to provide for the assumption of
the Company's or any Guarantor's obligations to Holders of the Notes in the
case of a merger or consolidation or sale of substantially all of the Company's
assets, to make any change that would provide any additional rights or benefits
to the Holders of the Notes or that does not adversely affect the legal rights
under the Indenture of any such Holder or to comply with the requirements of
the SEC in order to effect or maintain the qualification of the Indenture under
the Trust Indenture Act.
A1-5
<PAGE>
12. DEFAULTS AND REMEDIES. Events of Default include: (a) the Company
defaults for 30 days in the payment when due of interest on, or Liquidated
Damages, if any, with respect to, the Notes, whether or not such payment is
prohibited by the provisions of Article 10 of the Indenture; (b) the Company
defaults in payment when due of the principal of or premium, if any, on the
Notes, whether or not such payment is prohibited by the provisions of Article
10 of the Indenture; (c) the Company or any Restricted Subsidiary fails to
comply with any of the provisions of Section 4.15 or 5.01 of the Indenture; (d)
the Company or any Restricted Subsidiary fails for 30 days after written notice
by the Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes to comply with the provisions of Section 3.09, 4.07, 4.09 or
4.10 of the Indenture; (e) the Company or any Restricted Subsidiary fails for
60 days after written notice by the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes to comply with any of its other
agreements in the Indenture or the Notes; (f) the Company or any Restricted
Subsidiary defaults under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of
its Restricted Subsidiaries), whether such Indebtedness or guarantee now exists
or is created after the date of the Indenture, which default (i) is caused by a
failure to pay principal of or premium, if any, or interest on such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default") or (ii) results
in the acceleration of such Indebtedness prior to its express maturity and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$10.0 million or more; (g) the Company or any of its Restricted Subsidiaries
fails to pay final judgments aggregating in excess of $10.0 million, which
judgments are not paid, discharged or stayed for a period of 60 days; (h)
except as permitted by the Indenture, any Subsidiary Guarantee shall be held in
any judicial proceeding to be unenforceable or invalid or shall cease for any
reason to be in full force and effect or any Guarantor, or any Person acting on
behalf of any Guarantor, shall deny or disaffirm its obligations under its
Subsidiary Guarantee; (i) certain events of bankruptcy or insolvency with
respect to the Company or any of the Company's Restricted Subsidiaries that
constitutes a Significant Subsidiary or any group of Restricted Subsidiaries of
the Company that, taken together, would constitute a Significant Subsidiary. If
any Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the then outstanding Notes may declare all the
Notes to be due and payable immediately. Notwithstanding the foregoing, in the
case of an Event of Default arising from certain events of bankruptcy or
insolvency, with respect to the Company, any Restricted Subsidiary of the
Company that constitutes a Significant Subsidiary or any group of Restricted
Subsidiaries of the Company that, taken together, would constitute a
Significant Subsidiary, all outstanding Notes will become due and payable
without further action or notice. Holders of the Notes may not enforce the
Indenture or the Notes except as provided in the Indenture. Subject to certain
limitations, Holders of a majority in principal amount of the then outstanding
Notes may direct the Trustee in its exercise of any trust or power. The Trustee
may withhold from Holders of the Notes notice of any continuing Default or
Event of Default (except a Default or Event of Default relating to the payment
of principal or interest) if it determines that withholding notice is in their
interest. In the case of any Event of Default occurring by reason of any
willful action (or inaction) taken (or not taken) by or on behalf of the
Company with the intention of avoiding payment of the premium that the Company
would have had to pay if the Company then had elected to redeem the Notes
pursuant to Section 3.07 of the Indenture, an equivalent premium shall also
become and be immediately due and payable to the extent permitted by law upon
the acceleration of the Notes. If an Event of Default occurs prior to February
1, 2003 by reason of any willful action (or inaction) taken (or not taken) by
or on behalf of the Company with the intention of avoiding the prohibition on
redemption of the Notes prior to such date, then the premium specified in the
Indenture shall also become immediately due and payable to the extent permitted
by law upon the acceleration of the Notes. The Holders of a majority in
aggregate principal amount of the Notes then outstanding by notice to the
Trustee
A1-6
<PAGE>
may on behalf of the Holders of all of the Notes waive any existing Default or
Event of Default and its consequences under the Indenture except a continuing
Default or Event of Default in the payment of interest on, or the principal of,
the Notes. The Company is required to deliver to the Trustee annually a
statement regarding compliance with the Indenture, and the Company is required
upon becoming aware of any Default or Event of Default, to deliver to the
Trustee a statement specifying such Default or Event of Default.
13. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder, of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes or the Indenture
or for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the
issuance of the Notes.
15. AUTHENTICATION. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
16. ABBREVIATIONS. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the A/B Exchange
Registration Rights Agreement dated as of February 11, 1998, between the
Company and the parties named on the signature pages thereof (the "Registration
Rights Agreement").
18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to:
SFX Entertainment, Inc.
650 Madison Avenue
New York, New York 10022
Attention: Howard J. Tytel, Esq.
A1-7
<PAGE>
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to
- -------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint _______________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date:
------------------------
Your Signature:
-------------------------
(Sign exactly as your name appears on
the face of this Note)
Tax Identification No:
------------------
SIGNATURE GUARANTEE:
----------------------------------------
Signatures must be guaranteed by an
"eligible guarantor institution" meeting
the requirements of the Registrar, which
requirements include membership or
participation in the Security Transfer
Agent Medallion Program ("STAMP") or
such other "signature guarantee program"
as may be determined by the Registrar in
addition to, or in substitution for,
STAMP, all in accordance with the
Securities Exchange Act of 1934, as
amended.
A1-8
<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the box below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased: $________
Date:
------------------------
Your Signature:
-------------------------
(Sign exactly as your name appears on
the face of this Note)
Tax Identification No:
------------------
SIGNATURE GUARANTEE:
----------------------------------------
Signatures must be guaranteed by an
"eligible guarantor institution" meeting
the requirements of the Registrar, which
requirements include membership or
participation in the Security Transfer
Agent Medallion Program ("STAMP") or
such other "signature guarantee program"
as may be determined by the Registrar in
addition to, or in substitution for,
STAMP, all in accordance with the
Securities Exchange Act of 1934, as
amended.
A1-9
<PAGE>
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in thi Global Note, have
been made:
<TABLE>
<CAPTION>
Amount of Amount of Principal Amount
decrease in increase in of this Global Signature of
Principal Amount Principal Amount Note following authorized officer
of this Global of this Global such decrease (or of Trustee or Note
Date of Exchange Note Note increase) Custodian
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
</TABLE>
A1-10
<PAGE>
EXHIBIT A2
(Face of Note)
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND
THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES,
ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR
THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE
ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON.
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE
MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF THE COMPANY.
THE NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY HAS NOT BEEN REGISTERED
UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY
STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT AS
SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER:
REPRESENTS THAT (1) IT IS (A) A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) OR (B) NOT A U.S. PERSON AND IS ACQUIRING
THE NOTE EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION; (2) AGREES THAT IT WILL
NOT RESELL OR OTHERWISE TRANSFER THE NOTE EVIDENCED HEREBY EXCEPT TO (A) THE
COMPANY OR ANY SUBSIDIARY THEREOF, (B) A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) AN INSTITUTIONAL
ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE CHASE
MANHATTAN BANK, AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE), A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE NOTE EVIDENCED HEREBY (THE FORM OF WHICH LETTER
CAN BE OBTAINED FROM SUCH TRUSTEE OR A SUCCESSOR TRUSTEE, AS APPLICABLE), (D)
OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT,
(E) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE) OR IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (F) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND, IN EACH CASE, IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR ANY OTHER
APPLICABLE JURISDICTION; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO
WHOM THE NOTE EVIDENCED HEREBY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. IF THE PROPOSED TRANSFER IS PURSUANT TO CLAUSE (C), (D)
OR (E) ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE CHASE
MANHATTAN BANK, AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
CERTIFICATIONS, LEGAL OPINIONS OR
A2-1
<PAGE>
OTHER INFORMATION AS IT MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS
BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN, THE TERMS
"OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
CUSIP/CINS ________
9-1/8% Series A Senior Subordinated Notes due 2008
No.__ $_______________
SFX ENTERTAINMENT, INC.
promises to pay to ____________________________________ or registered assigns,
the principal sum of _____________________________ Dollars on
_____________________, 2008.
Interest Payment Dates: ____________________, and ___________________.
Record Dates: _________, and _________________________-.
Dated: ___________________________, 1998
SFX ENTERTAINMENT, INC.
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
This is one of the Global
Notes referred to in the
within-mentioned Indenture:
The Chase Manhattan Bank,
as Trustee
By:
--------------------------
A2-2
<PAGE>
(Reverse face of Note)
9-1/8% Series A Senior Subordinated Notes due 2008
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. SFX Entertainment, Inc., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note at
9-1/8% per annum from February 11, 1998 until maturity and shall pay the
Liquidated Damages payable pursuant to Section 5 of the Registration Rights
Agreement referred to below. The Company will pay interest and Liquidated
Damages semi-annually on February 1 and August 1 of each year, or if any such
day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest on the Notes will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from the date of issuance; provided that if there is no existing Default in the
payment of interest, and if this Note is authenticated between a record date
referred to on the face hereof and the next succeeding Interest Payment Date,
interest shall accrue from such next succeeding Interest Payment Date;
provided, further, that the first Interest Payment Date shall be August 1,
1998. The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any,
from time to time on demand at a rate that is 1% per annum in excess of the
rate then in effect; it shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue installments of interest
and Liquidated Damages (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
Until this Regulation S Temporary Global Note is exchanged for one or
more Regulation S Permanent Global Notes, the Holder hereof shall not be
entitled to receive payments of interest hereon; until so exchanged in full,
this Regulation S Temporary Global Note shall in all other respects be entitled
to the same benefits as other Notes under the Indenture.
2. METHOD OF PAYMENT. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages to the Persons who are
registered Holders of Notes at the close of business on the January 15 or July
15 next preceding the Interest Payment Date, even if such Notes are canceled
after such record date and on or before such Interest Payment Date, except as
provided in Section 2.12 of the Indenture with respect to defaulted interest.
The Notes will be payable as to principal, premium, interest and Liquidated
Damages at the office or agency of the Company maintained for such purpose
within or without the City and State of New York, or, at the option of the
Company, payment of interest and Liquidated Damages may be made by check mailed
to the Holders at their addresses set forth in the register of Holders, and
provided that payment by wire transfer of funds will be required with respect
to principal of and interest, premium and Liquidated Damages on, all Global
Notes and all other Notes the Holders of which shall have provided wire
transfer instructions to the Company or the Paying Agent. Such payment shall be
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, The Chase Manhattan Bank,
the Trustee under the Indenture, will act as Paying Agent and Registrar. The
Company may change any Paying Agent or Registrar without notice to any Holder.
The Company or any of its Subsidiaries may act in any such capacity.
A2-3
<PAGE>
4. INDENTURE. The Company issued the Notes under an Indenture dated as
of February 11, 1998 ("Indenture") between the Company and the Trustee. The
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code ss.ss. 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. The Notes are obligations of the Company limited to $350.0 million in
aggregate principal amount.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 5, the Company
shall not have the option to redeem the Notes pursuant to this Section 5 prior
to February 1, 2003. Thereafter, the Company shall have the option to redeem
the Notes, in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest and Liquidated Damages, if
any, thereon to the applicable redemption date, if redeemed during the
twelve-month period beginning on February 1 of the years indicated below:
YEAR PERCENTAGE
---- ----------
2003.............................................. 104.563%
2004.............................................. 103.042%
2005.............................................. 101.521%
2006 and thereafter............................... 100.000%
(b) Notwithstanding the foregoing, prior to February 1, 2001, the
Company may, on any one or more occasions, redeem up to 35% of the aggregate
principal amount of Notes originally issued in the Offering at a redemption
price of 109.125% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the redemption date, with
the net cash proceeds of an offering of common equity of the Company (other
than Disqualified Stock); provided that (i) at least 65% of the aggregate
principal amount of the Notes originally issued in the Offering remain
outstanding immediately after the occurrence of each such redemption (excluding
Notes held by the Company and its Subsidiaries) and (ii) each such redemption
shall occur within 75 days after the date of the closing of any such offering
of common equity of the Company.
6. MANDATORY REDEMPTION.
Except as set forth in paragraph 7 below, the Company shall not be
required to make mandatory redemption payments with respect to the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be obligated to
make an offer (a "Change of Control Offer") to each Holder of Notes to
repurchase all or any part (equal to $1,000 or an integral multiple thereof) of
such Holder's Notes at an offer price in cash equal to 101% of the principal
amount thereof, plus accrued and unpaid interest and Liquidated Damages, if
any, thereon to the date of purchase (the "Change of Control Payment"). Within
ten days following a Change of Control, the Company will mail a notice to each
Holder describing the transaction or transactions that constitute the
A2-4
<PAGE>
Change of Control and offering to repurchase Notes on the date specified in
such notice, which date shall be no earlier than 30 days and no later than 60
days from the date such notice is mailed (the "Change of Control Payment
Date"), pursuant to the procedures required by the Indenture and described in
such notice.
(b) If the Company or a Subsidiary consummates any Asset Sales, when
the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company
shall be required to make an offer to all Holders of Notes and all holders of
other pari passu Indebtedness containing provisions similar to those set forth
in the Indenture with respect to offers to purchase or redeem such other pari
passu Indebtedness with the proceeds of sales of assets (an "Asset Sale Offer")
to purchase the maximum principal amount of Notes and such other pari passu
Indebtedness that may be purchased out of the Excess Proceeds at an offer price
in cash in an amount equal to 100% of the principal amount thereof, plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the date
of purchase, in accordance with the procedures set forth in the Indenture and
in such other pari passu Indebtedness. To the extent that the aggregate amount
of Notes and such other pari passu Indebtedness tendered pursuant to an Asset
Sale Offer is less than the Excess Proceeds, the Company may use any remaining
Excess Proceeds for any purpose not otherwise prohibited by the Indenture. If
the aggregate principal amount of Notes and such other pari passu Indebtedness
surrendered by Holders thereof exceeds the amount of Excess Proceeds, the
Trustee shall select the Notes and such other pari passu Indebtedness to be
purchased on a pro rata basis. Upon completion of an Asset Sale Offer, the
amount of Excess Proceeds shall be reset at zero.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at least
30 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes
or portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000.
The transfer of Notes may be registered and Notes may be exchanged as provided
in the Indenture. The Registrar and the Trustee may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and
the Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, it need not
exchange or register the transfer of any Notes for a period of 15 days before a
selection of Notes to be redeemed or during the period between a record date
and the corresponding Interest Payment Date.
This Regulation S Temporary Global Note is exchangeable in whole or in
part for one or more Global Notes only (i) on or after the termination of the
40-day restricted period (as defined in Regulation S) and (ii) upon
presentation of certificates (accompanied by an Opinion of Counsel, if
applicable) required by Article 2 of the Indenture. Upon exchange of this
Regulation S Temporary Global Note for one or more Global Notes, the Trustee
shall cancel this Regulation S Temporary Global Note.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture , the Subsidiary Guarantees or the Notes may be amended or
supplemented with the consent of
A2-5
<PAGE>
the Holders of at least a majority in principal amount of the then outstanding
Notes voting as a single class (including without limitation, consents obtained
in connection with a purchase of, or tender offer or exchange offer for,
Notes), and any existing default or compliance with any provision of the
Indenture, the Subsidiary Guarantees or the Notes may be waived with the
consent of the Holders of a majority in principal amount of the then
outstanding Notes voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for Notes). Without the
consent of any Holder of Notes, the Indenture, the Subsidiary Guarantees or the
Notes may be amended or supplemented to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Notes in addition to or in place
of certificated Notes, to provide for the assumption of the Company's or any
Guarantor's obligations to Holders of the Notes in the case of a merger or
consolidation or sale of substantially all of the Company's assets, to make any
change that would provide any additional rights or benefits to the Holders of
the Notes or that does not adversely affect the legal rights under the
Indenture of any such Holder or to comply with the requirements of the SEC in
order to effect or maintain the qualification of the Indenture under the Trust
Indenture Act.
12. DEFAULTS AND REMEDIES. Events of Default include: (a) the Company
defaults for 30 days in the payment when due of interest on, or Liquidated
Damages, if any, with respect to, the Notes, whether or not such payment is
prohibited by the provisions of Article 10 of the Indenture; (b) the Company
defaults in payment when due of the principal of or premium, if any, on the
Notes, whether or not such payment is prohibited by the provisions of Article
10 of the Indenture; (c) the Company or any Restricted Subsidiary fails to
comply with any of the provisions of Section 4.15 or 5.01 of the Indenture; (d)
the Company or any Restricted Subsidiary fails for 30 days after written notice
by the Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes to comply with the provisions of Section 3.09, 4.07, 4.09 or
4.10 of the Indenture; (e) the Company or any Restricted Subsidiary fails for
60 days after written notice by the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes to comply with any of its other
agreements in the Indenture or the Notes; (f) the Company or any Restricted
Subsidiary defaults under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of
its Restricted Subsidiaries), whether such Indebtedness or guarantee now exists
or is created after the date of the Indenture, which default (i) is caused by a
failure to pay principal of or premium, if any, or interest on such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default") or (ii) results
in the acceleration of such Indebtedness prior to its express maturity and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$10.0 million or more; (g) the Company or any of its Restricted Subsidiaries
fails to pay final judgments aggregating in excess of $10.0 million, which
judgments are not paid, discharged or stayed for a period of 60 days; (h)
except as permitted by the Indenture, any Subsidiary Guarantee shall be held in
any judicial proceeding to be unenforceable or invalid or shall cease for any
reason to be in full force and effect or any Guarantor, or any Person acting on
behalf of any Guarantor, shall deny or disaffirm its obligations under its
Subsidiary Guarantee; (i) certain events of bankruptcy or insolvency with
respect to the Company or any of the Company's Restricted Subsidiaries that
constitutes a Significant Subsidiary or any group of Restricted Subsidiaries of
the Company that, taken together, would constitute a Significant Subsidiary. If
any Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the then outstanding Notes may declare all the
Notes to be due and payable immediately. Notwithstanding the foregoing, in the
case of an Event of Default arising from certain events of bankruptcy or
insolvency, with respect to the Company, any Restricted Subsidiary of the
Company that constitutes a Significant
A2-6
<PAGE>
Subsidiary or any group of Restricted Subsidiaries of the Company that, taken
together, would constitute a Significant Subsidiary, all outstanding Notes will
become due and payable without further action or notice. Holders of the Notes
may not enforce the Indenture or the Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in principal amount of
the then outstanding Notes may direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of the Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest) if it determines that
withholding notice is in their interest. In the case of any Event of Default
occurring by reason of any willful action (or inaction) taken (or not taken) by
or on behalf of the Company with the intention of avoiding payment of the
premium that the Company would have had to pay if the Company then had elected
to redeem the Notes pursuant to Section 3.07 of the Indenture, an equivalent
premium shall also become and be immediately due and payable to the extent
permitted by law upon the acceleration of the Notes. If an Event of Default
occurs prior to February 1, 2003 by reason of any willful action (or inaction)
taken (or not taken) by or on behalf of the Company with the intention of
avoiding the prohibition on redemption of the Notes prior to such date, then
the premium specified in the Indenture shall also become immediately due and
payable to the extent permitted by law upon the acceleration of the Notes. The
Holders of a majority in aggregate principal amount of the Notes then
outstanding by notice to the Trustee may on behalf of the Holders of all of the
Notes waive any existing Default or Event of Default and its consequences under
the Indenture except a continuing Default or Event of Default in the payment of
interest on, or the principal of, the Notes. The Company is required to deliver
to the Trustee annually a statement regarding compliance with the Indenture,
and the Company is required upon becoming aware of any Default or Event of
Default, to deliver to the Trustee a statement specifying such Default or Event
of Default.
13. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder, of the Company or any of the Guarantors, as such,
shall not have any liability for any obligations of the Company or such
Guarantor under the Notes, the Note Guarantees or the Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the
issuance of the Notes.
15. AUTHENTICATION. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
16. ABBREVIATIONS. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the A/B Exchange
Registration Rights Agreement dated as of February 11, 1998, between the
Company and the parties named on the signature pages thereof (the "Registration
Rights Agreement").
A2-7
<PAGE>
18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to:
SFX Entertainment, Inc.
650 Madison Avenue
New York, New York 10022
Attention: Howard J. Tytel, Esq.
A2-8
<PAGE>
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to
- -------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint _______________________________________________ to
transfer this Note on the books of the Company. The agent may substitute
another to act for him.
______________ ______________________________________________________________
Date:
------------------------
Your Signature:
-------------------------
(Sign exactly as your name appears on
the face of this Note)
Tax Identification No:
------------------
SIGNATURE GUARANTEE:
----------------------------------------
Signatures must be guaranteed by an
"eligible guarantor institution" meeting
the requirements of the Registrar, which
requirements include membership or
participation in the Security Transfer
Agent Medallion Program ("STAMP") or
such other "signature guarantee program"
as may be determined by the Registrar in
addition to, or in substitution for,
STAMP, all in accordance with the
Securities Exchange Act of 1934, as
amended.
A2-9
<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased: $___________
- -------------------------------------------------------------------------------
Date:
------------------------
Your Signature:
-------------------------
(Sign exactly as your name appears on
the face of this Note)
Tax Identification No:
------------------
SIGNATURE GUARANTEE:
----------------------------------------
Signatures must be guaranteed by an
"eligible guarantor institution" meeting
the requirements of the Registrar, which
requirements include membership or
participation in the Security Transfer
Agent Medallion Program ("STAMP") or
such other "signature guarantee program"
as may be determined by the Registrar in
addition to, or in substitution for,
STAMP, all in accordance with the
Securities Exchange Act of 1934, as
amended.
A2-10
<PAGE>
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary
Global Note for an interest in another Global Note, or of other Restricted
Global Notes for an interest in this Regulation S Temporary Global Note, have
been made:
<TABLE>
<CAPTION>
Amount of Amount of Principal Amount
decrease in increase in of this Global Signature of
Principal Amount Principal Amount Note following authorized officer
of this Global of this Global such decrease (or of Trustee or Note
Date of Exchange Note Note increase) Custodian
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
</TABLE>
A2-11
<PAGE>
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
SFX Entertainment, Inc.
650 Madison Avenue
New York, New York 10022
The Chase Manhattan Bank
450 West 33rd Street -15th Floor
New York, New York 10001
Re: 9-1/8% Senior Subordinated Notes Due 2008
(CUSIP ______________)
Reference is hereby made to the Indenture, dated as of February 11,
1998 (the "Indenture"), among SFX Entertainment, Inc., as issuer (the
"Company") , Atlanta Concerts, Inc., Ardee Festivals N.J., Inc., Ardee
Productions, Ltd., Beach Concerts, Inc., BGP Acquisition, LLC, Broadway
Concerts, Inc., Connecticut Amphitheater Development Corp., Connecticut
Concerts, Incorporated, Connecticut Performing Arts, Inc., Connecticut
Performing Arts Partners, Conn Ticketing Company, Contemporary Group
Acquisition Corp., Deer Creek Amphitheater Concerts, Inc., Deer Creek
Amphitheater Concerts, LP, Delsener/Slater Enterprises, Ltd., Dumb Deal, Inc.,
Exit 116 Revisited, Inc., FPI Concerts, Inc., In House Tickets, Inc., Irving
Plaza Concerts, Inc., Murat Center Concerts, Inc., Murat Center Concerts, LP,
NOC, Inc., Northeast Ticketing Company, Polaris Amphitheater Concerts, Inc., QN
Corp., SFX Broadcasting of the Midwest, Inc., SFX Concerts, Inc., SFX Network
Group, LLC, Southeast Ticketing Company, Sunshine Concerts, LLC, Sunshine
Designs, Inc., Sunshine Designs, LP, Suntex Acquisition, Inc., Suntex
Acquisition, LP, Westbury Music Fair, LLC as Guarantors (the "Guarantors") and
The Chase Manhattan Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
______________, (the "Transferor") owns and proposes to transfer the
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to __________ (the "Transferee"), as further specified in Annex A hereto. In
connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE
144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO RULE 144A. The Transfer is
being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the
Transferor reasonably believed and believes is purchasing the beneficial
interest or Definitive Note for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and
such Person and each such account is a "qualified institutional buyer" within
the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A
and such Transfer is in compliance with any applicable blue sky securities laws
of any state of the United States. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or
B-1
<PAGE>
Definitive Note will be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the 144A Global Note and/or the
Definitive Note and in the Indenture and the Securities Act.
2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE
TEMPORARY REGULATION S GLOBAL NOTE, THE REGULATION S GLOBAL NOTE OR A
DEFINITIVE NOTE PURSUANT TO REGULATION S. The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the Securities
Act and, accordingly, the Transferor hereby further certifies that (i) the
Transfer is not being made to a person in the United States and (x) at the time
the buy order was originated, the Transferee was outside the United States or
such Transferor and any Person acting on its behalf reasonably believed and
believes that the Transferee was outside the United States or (y) the
transaction was executed in, on or through the facilities of a designated
offshore securities market and neither such Transferor nor any Person acting on
its behalf knows that the transaction was prearranged with a buyer in the
United States, (ii) no directed selling efforts have been made in contravention
of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the
Securities Act, (iii) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act and (iv) if the proposed
transfer is being made prior to the expiration of the Restricted Period, the
transfer is not being made to a U.S. Person or for the account or benefit of a
U.S. Person (other than an Initial Purchaser). Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on Transfer enumerated in the Private Placement Legend printed on
the Regulation S Global Note, the Temporary Regulation S Global Note and/or the
Definitive Note and in the Indenture and the Securities Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE IAI GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO ANY PROVISION
OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Definitive Notes
and pursuant to and in accordance with the Securities Act and any applicable
blue sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or a subsidiary
thereof;
or
(c) [ ] such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act;
or
(d) [ ] such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements of the
Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor
hereby further certifies that it has not engaged in any general solicitation
within the meaning of Regulation D under the Securities Act and the Transfer
complies with the transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the requirements of
the exemption claimed, which certification is supported by (1) a certificate
executed by the
B-2
<PAGE>
Transferee in the form of Exhibit D to the Indenture and (2) if such Transfer
is in respect of a principal amount of Notes at the time of transfer of less
than $250,000, an Opinion of Counsel provided by the Transferor or the
Transferee (a copy of which the Transferor has attached to this certification),
to the effect that such Transfer is in compliance with the Securities Act. Upon
consummation of the proposed transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the IAI Global Note and/or the Definitive Notes and in the
Indenture and the Securities Act.
4. [ ] Check if Transferee will take delivery of a beneficial interest in an
Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
B-3
<PAGE>
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
-----------------------------
[Insert Name of Transferor]
By:
--------------------------
Name:
Title:
Dated: ______________ __, ____.
B-4
<PAGE>
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _____), or
(ii) [ ] Regulation S Global Note (CUSIP _____), or
(iii) [ ] IAI Global Note (CUSIP _____); or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _____), or
(ii) [ ] Regulation S Global Note (CUSIP _____), or
(iii) [ ] IAI Global Note (CUSIP _____); or
(iv) [ ] Unrestricted Global Note (CUSIP _____); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-5
<PAGE>
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
SFX Entertainment, Inc.
650 Madison Avenue
New York, New York 10022
The Chase Manhattan Bank
450 West 33rd Street -15th Floor
New York, New York 10001
Re: 9-1/8% Senior Subordinated Notes Due 2008
(CUSIP ______________)
Reference is hereby made to the Indenture, dated as of February 11,
1998 (the "Indenture"), among SFX Entertainment, Inc., as issuer (the
"Company") , Atlanta Concerts, Inc., Ardee Festivals N.J., Inc., Ardee
Productions, Ltd., Beach Concerts, Inc., BGP Acquisition, LLC, Broadway
Concerts, Inc., Connecticut Amphitheater Development Corp., Connecticut
Concerts, Incorporated, Connecticut Performing Arts, Inc., Connecticut
Performing Arts Partners, Conn Ticketing Company, Contemporary Group
Acquisition Corp., Deer Creek Amphitheater Concerts, Inc., Deer Creek
Amphitheater Concerts, LP, Delsener/Slater Enterprises, Ltd., Dumb Deal, Inc.,
Exit 116 Revisited, Inc., FPI Concerts, Inc., In House Tickets, Inc., Irving
Plaza Concerts, Inc., Murat Center Concerts, Inc., Murat Center Concerts, LP,
NOC, Inc., Northeast Ticketing Company, Polaris Amphitheater Concerts, Inc., QN
Corp., SFX Broadcasting of the Midwest, Inc., SFX Concerts, Inc., SFX Network
Group, LLC, Southeast Ticketing Company, Sunshine Concerts, LLC, Sunshine
Designs, Inc., Sunshine Designs, LP, Suntex Acquisition, Inc., Suntex
Acquisition, LP, Westbury Music Fair, LLC as Guarantors (the "Guarantors") and
The Chase Manhattan Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
____________, (the "Owner") owns and proposes to exchange the Note[s]
or interest in such Note[s] specified herein, in the principal amount of
$____________ in such Note[s] or interests (the "Exchange"). In connection with
the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN
A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN AN UNRESTRICTED GLOBAL NOTE
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an
equal principal amount, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Global Notes and pursuant to and in accordance with the
United States Securities Act of 1933, as amended (the "Securities Act"), (iii)
the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest in an Unrestricted Global Note
is being acquired in compliance with any applicable blue sky securities laws of
any state of the United States.
C-1
<PAGE>
(b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in
an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest is
being acquired in compliance with any applicable blue sky securities laws of
any state of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner
hereby certifies (i) the Unrestricted Definitive Note is being acquired for the
Owner's own account without transfer, (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to Restricted Definitive
Notes and pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the Unrestricted Definitive Note is being acquired in compliance with
any applicable blue sky securities laws of any state of the United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN
RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
IN RESTRICTED GLOBAL NOTES
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the
Exchange of the Owner's Restricted Definitive Note for a beneficial interest in
the [CHECK ONE] [ ] 144A Global Note, [ ] Regulation S Global Note, [ ] IAI
Global Note with an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer and (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Notes and pursuant to
and in accordance with the Securities Act, and in compliance with any
applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Exchange in accordance with the terms of the
Indenture, the
C-2
<PAGE>
beneficial interest issued will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the relevant Restricted
Global Note and in the Indenture and the Securities Act.
C-3
<PAGE>
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
---------------------------------
[Insert Name of Owner]
By:
------------------------------
Name:
Title:
Dated: __________________ __, ____.
C-4
<PAGE>
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
SFX Entertainment, Inc.
650 Madison Avenue
New York, New York 10022
The Chase Manhattan Bank
450 West 33rd Street -15th Floor
New York, New York 10001
Re: 9-1/8% Senior Subordinated Notes Due 2008
(CUSIP ______________)
Reference is hereby made to the Indenture, dated as of February 11,
1998 (the "Indenture"), among SFX Entertainment, Inc., as issuer (the
"Company"), Atlanta Concerts, Inc., Ardee Festivals N.J., Inc., Ardee
Productions, Ltd., Beach Concerts, Inc., BGP Acquisition, LLC, Broadway
Concerts, Inc., Connecticut Amphitheater Development Corp., Connecticut
Concerts, Incorporated, Connecticut Performing Arts, Inc., Connecticut
Performing Arts Partners, Conn Ticketing Company, Contemporary Group
Acquisition Corp., Deer Creek Amphitheater Concerts, Inc., Deer Creek
Amphitheater Concerts, LP, Delsener/Slater Enterprises, Ltd., Dumb Deal, Inc.,
Exit 116 Revisited, Inc., FPI Concerts, Inc., In House Tickets, Inc., Irving
Plaza Concerts, Inc., Murat Center Concerts, Inc., Murat Center Concerts, LP,
NOC, Inc., Northeast Ticketing Company, Polaris Amphitheater Concerts, Inc., QN
Corp., SFX Broadcasting of the Midwest, Inc., SFX Concerts, Inc., SFX Network
Group, LLC, Southeast Ticketing Company, Sunshine Concerts, LLC, Sunshine
Designs, Inc., Sunshine Designs, LP, Suntex Acquisition, Inc., Suntex
Acquisition, LP, Westbury Music Fair, LLC as Guarantors (the "Guarantors") and
The Chase Manhattan Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which
we are acting
D-1
<PAGE>
as hereinafter stated, that if we should sell the Notes or any interest
therein, we will do so only (A) to the Company or any subsidiary thereof, (B)
in accordance with Rule 144A under the Securities Act to a "qualified
institutional buyer" (as defined therein), (c) to an institutional "accredited
investor" (as defined below) that, prior to such transfer, furnishes (or has
furnished on its behalf by a U.S. broker-dealer) to you and to the Company a
signed letter substantially in the form of this letter and, if such transfer is
in respect of a principal amount of Notes, at the time of transfer of less than
$250,000, an Opinion of Counsel in form reasonably acceptable to the Company to
the effect that such transfer is in compliance with the Securities Act, (D)
outside the United States in accordance with Rule 904 of Regulation S under the
Securities Act, (E) pursuant to the provisions of Rule 144(k) under the
Securities Act or (F) pursuant to an effective registration statement under the
Securities Act, and we further agree to provide to any person purchasing the
Definitive Note or beneficial interest in a Global Note from us in a
transaction meeting the requirements of clauses (A) through (E) of this
paragraph a notice advising such purchaser that resales thereof are restricted
as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and
the Company may reasonably require to confirm that the proposed sale complies
with the foregoing restrictions. We further understand that the Notes purchased
by us will bear a legend to the foregoing effect. We further understand that
any subsequent transfer by us of the Notes or beneficial interest therein
acquired by us must be effected through one of the Placement Agents.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Notes, and
we and any accounts for which we are acting are each able to bear the economic
risk of our or its investment.
5. We are acquiring the Notes or beneficial interest therein purchased
by us for our own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby.
------------------------------------
[Insert Name of Accredited Investor]
By:
---------------------------------
Name:
Title:
Dated: _________________ __, ____.
D-2
<PAGE>
EXHIBIT E
FORM OF NOTATION OF SUBSIDIARY GUARANTEE
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of February 11, 1998 (the "Indenture")
among SFX Entertainment, Inc., the Guarantors listed on Schedule I thereto and
The Chase Manhattan Bank, as trustee (the "Trustee"), (a) the due and punctual
payment of the principal of, premium, if any, and interest on the Notes (as
defined in the Indenture), whether at maturity, by acceleration, redemption or
otherwise, the due and punctual payment of interest on overdue principal and
premium, and, to the extent permitted by law, interest, and the due and
punctual performance of all other obligations of the Company to the Holders or
the Trustee all in accordance with the terms of the Indenture and (b) in case
of any extension of time of payment or renewal of any Notes or any of such
other obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise. The obligations of the
Guarantors to the Holders of Notes and to the Trustee pursuant to the
Subsidiary Guarantee and the Indenture are expressly set forth in Article 11 of
the Indenture and reference is hereby made to the Indenture for the precise
terms of the Subsidiary Guarantee. Each Holder of a Note, by accepting the
same, (a) agrees to and shall be bound by such provisions, (b) authorizes and
directs the Trustee, on behalf of such Holder, to take such action as may be
necessary or appropriate to effectuate the subordination as provided in the
Indenture and (c) appoints the Trustee attorney-in-fact of such Holder for such
purpose; provided, however, that the Indebtedness evidenced by this Subsidiary
Guarantee shall cease to be so subordinated and subject in right of payment
upon any defeasance of this Note in accordance with the provisions of the
Indenture.
ATLANTA CONCERTS, INC.
By:
-----------------------------
Name:
Title:
ARDEE FESTIVALS N.J., INC.
By:
-----------------------------
Name:
Title:
ARDEE PRODUCTIONS, LTD.
By:
-----------------------------
Name:
Title:
E-1
<PAGE>
BEACH CONCERTS, INC.
By:
-----------------------------
Name:
Title:
BGP ACQUISITION, LLC
By:
-----------------------------
Name:
Title:
BROADWAY CONCERTS, INC.
By:
-----------------------------
Name:
Title:
CONNECTICUT AMPHITHEATER
DEVELOPMENT CORP.
By:
-----------------------------
Name:
Title:
CONNECTICUT CONCERTS, INCORPORATED
By:
-----------------------------
Name:
Title:
CONNECTICUT PERFORMING ARTS, INC.
By:
-----------------------------
Name:
Title:
CONNECTICUT PERFORMING ARTS PARTNERS
By:
-----------------------------
Name:
Title:
E-2
<PAGE>
CONN TICKETING COMPANY
By:
-----------------------------
Name:
Title:
CONTEMPORARY GROUP ACQUISITION CORP.
By:
-----------------------------
Name:
Title:
DEER CREEK AMPHITHEATER
CONCERTS, INC.
By:
-----------------------------
Name:
Title:
DEER CREEK AMPHITHEATER
CONCERTS, LP
By:
-----------------------------
Name:
Title:
DELSENER/SLATER ENTERPRISES, LTD.
By:
-----------------------------
Name:
Title:
DUMB DEAL, INC.
By:
-----------------------------
Name:
Title:
EXIT 116 REVISITED, INC.
By:
-----------------------------
Name:
Title:
E-3
<PAGE>
FPI CONCERTS, INC.
By:
-----------------------------
Name:
Title:
IN HOUSE TICKETS, INC.
By:
-----------------------------
Name:
Title:
IRVING PLAZA CONCERTS, INC.
By:
-----------------------------
Name:
Title:
MURAT CENTER CONCERTS, INC.
By:
-----------------------------
Name:
Title:
MURAT CENTER CONCERTS, LP
By:
-----------------------------
Name:
Title:
NOC, INC.
By:
-----------------------------
Name:
Title:
NORTHEAST TICKETING COMPANY
By:
-----------------------------
Name:
Title:
POLARIS AMPHITHEATER CONCERTS, INC.
By:
-----------------------------
Name:
Title:
E-4
<PAGE>
QN CORP.
By:
-----------------------------
Name:
Title:
SFX BROADCASTING OF THE
MIDWEST, INC.
By:
-----------------------------
Name:
Title:
SFX CONCERTS, INC.
By:
-----------------------------
Name:
Title:
SFX NETWORK GROUP, LLC
By:
-----------------------------
Name:
Title:
SOUTHEAST TICKETING COMPANY
By:
-----------------------------
Name:
Title:
SUNSHINE CONCERTS, LLC
By:
-----------------------------
Name:
Title:
SUNSHINE DESIGNS, INC.
By:
-----------------------------
Name:
Title:
E-5
<PAGE>
SUNSHINE DESIGNS, LP
By:
-----------------------------
Name:
Title:
SUNTEX ACQUISITION, INC.
By:
-----------------------------
Name:
Title:
SUNTEX ACQUISITION, LP
By:
-----------------------------
Name:
Title:
WESTBURY MUSIC FAIR, LLC
By:
-----------------------------
Name:
Title:
E-6
<PAGE>
EXHIBIT F
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
________________, between __________________ (the "Guarantor"), a direct or
indirect subsidiary of SFX Entertainment, Inc. (or its successor), a Delaware
corporation (the "Company"), and The Chase Manhattan Bank as trustee under the
indenture referred to below (the "Trustee").
W I T N E S S E T H
WHEREAS, The Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of February 11, 1998,
providing for the issuance of an aggregate principal amount of $350,000,000 of
9-1/8% Senior Subordinated Notes due 2008 (the "Notes");
WHEREAS, Section 4.20 of the Indenture provides that under certain
circumstances the Company is required to cause the Guarantor to execute and
deliver to the Trustee a supplemental indenture pursuant to which the Guarantor
shall unconditionally guarantee all of the Company's Obligations under the
Notes pursuant to a Subsidiary Guarantee on the terms and conditions set forth
herein; and
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guarantor and the Trustee mutually covenant and agree for the equal and ratable
benefit of the holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guarantor hereby agrees, jointly and
severally with all other Guarantors, to guarantee the Company's obligations
under the Notes on the terms and subject to the conditions set forth in Article
11 of the Indenture and to be bound by all other applicable provisions of the
Indenture, including, without limitation, the provisions of Article 10 of the
Indenture.
3. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, shareholder or agent of the Guarantor, as
such, shall have any liability for any obligations of the Company or any
Guarantor under the Notes, any Subsidiary Guarantees, the Indenture or this
Supplemental Indenture or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder of the Notes by accepting a
Note waives and releases all such liability. The waiver and release are part of
the consideration for issuance of the Notes. Such waiver may not be effective
to waive liabilities under the federal securities laws and it is the view of
the Commission that such a waiver is against public policy.
4. EFFECTIVENESS. This Supplemental Indenture shall be effective upon
execution by the parties hereto.
5. RECITALS. The recitals contained herein shall be taken as the
statements of the Company and the Guarantors and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations as
to the validity of this Supplemental Indenture.
F-1
<PAGE>
6. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE.
7. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
8. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: ____________ ___, ____
[Guarantor]
By:
-----------------------------
Name:
Title:
The Chase Manhattan Bank, as Trustee
By:
-----------------------------
Name:
Title:
F-2
<PAGE>
SCHEDULE I
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under the Indenture as of
the Issue Date:
1. Atlanta Concerts, Inc.
2. Ardee Festivals N.J., Inc.
3. Ardee Productions, Ltd.
4. Beach Concerts, Inc.
5. BGP Acquisition, LLC
6. Broadway Concerts, Inc.
7. Connecticut Amphitheater Development Corp.
8. Connecticut Concerts, Incorporated
9. Connecticut Performing Arts, Inc.
10. Connecticut Performing Arts Partners
11. Conn Ticketing Company
12. Contemporary Group Acquisition Corp.
13. Deer Creek Amphitheater Concerts, Inc.
14. Deer Creek Amphitheater Concerts, LP
15. Delsener/Slater Enterprises, Ltd.
16. Dumb Deal, Inc.
17. Exit 116 Revisited, Inc.
18. FPI Concerts, Inc.
19. In House Tickets, Inc.
20. Irving Plaza Concerts, Inc.
21. Murat Center Concerts, Inc.
22. Murat Center Concerts, LP
23. NOC, Inc.
24. Northeast Ticketing Company
25. Polaris Amphitheater Concerts, Inc.
26. QN Corp.
27. SFX Broadcasting of the Midwest, Inc.
28. SFX Concerts, Inc.
<PAGE>
29. SFX Network Group, LLC
30. Southeast Ticketing Company
31. Sunshine Concerts, LLC
32. Sunshine Designs, Inc.
33. Sunshine Designs, LP
34. Suntex Acquisition, Inc.
35. Suntex Acquisition, LP
36. Westbury Music Fair, LLC
- 2 -
<PAGE>
EXECUTION COPY
===============================================================================
9-1/8% SENIOR SUBORDINATED NOTES DUE 2008
REGISTRATION RIGHTS AGREEMENT
Dated as of February 11, 1998
by and among
SFX ENTERTAINMENT, INC.,
AS ISSUER,
ATLANTA CONCERTS, INC., ARDEE FESTIVALS N.J., INC., ARDEE PRODUCTIONS, LTD.,
BEACH CONCERTS, INC., BGP ACQUISITION, LLC, BROADWAY CONCERTS, INC.,
CONNECTICUT AMPHITHEATER DEVELOPMENT CORP., CONNECTICUT CONCERTS, INCORPORATED,
CONNECTICUT PERFORMING ARTS, INC., CONNECTICUT PERFORMING ARTS PARTNERS, CONN
TICKETING COMPANY, CONTEMPORARY GROUP ACQUISITION CORP., DEER CREEK
AMPHITHEATER CONCERTS, INC., DEER CREEK AMPHITHEATER CONCERTS, LP,
DELSENER/SLATER ENTERPRISES, LTD., DUMB DEAL, INC., EXIT 116 REVISITED, INC.,
FPI CONCERTS, INC., IN HOUSE TICKETS, INC., IRVING PLAZA CONCERTS, INC., MURAT
CENTER CONCERTS, INC., MURAT CENTER CONCERTS, LP, NOC, INC., NORTHEAST
TICKETING COMPANY, POLARIS AMPHITHEATER CONCERTS, INC., QN CORP., SFX
BROADCASTING OF THE MIDWEST, INC., SFX CONCERTS, INC., SFX NETWORK GROUP, LLC,
SOUTHEAST TICKETING COMPANY, SUNSHINE CONCERTS, LLC, SUNSHINE DESIGNS, INC.,
SUNSHINE DESIGNS, LP, SUNTEX ACQUISITION, INC., SUNTEX ACQUISITION, LP,
WESTBURY MUSIC FAIR, LLC,
AS GUARANTORS,
and
LEHMAN BROTHERS INC.,
GOLDMAN, SACHS & CO.,
BNY CAPITAL MARKETS, INC., and
ING BARINGS.
===============================================================================
<PAGE>
This Registration Rights Agreement (this "AGREEMENT") is made and
entered into as of February 11, 1998, by and among SFX Entertainment, Inc., a
Delaware corporation (the "COMPANY"), the Guarantors (as defined in the
Purchase Agreement (as defined below)), and Lehman Brothers Inc., Goldman,
Sachs & Co., BNY Capital Markets, Inc. and ING Barings (each an "INITIAL
PURCHASER" and, collectively, the "INITIAL PURCHASERS"), each of whom has
agreed to purchase the Company's 9-1/8% Senior Subordinated Notes due 2008 (the
"SERIES A NOTES") pursuant to the Purchase Agreement.
This Agreement is made pursuant to the Purchase Agreement, dated
February 5, 1998 (the PURCHASE AGREEMENT"), by and among the Company, the
Guarantors and the Initial Purchasers. In order to induce the Initial
Purchasers to purchase the Series A Notes (as defined below), the Company has
agreed to provide the registration rights set forth in this Agreement. The
execution and delivery of this Agreement is a condition to the obligations of
the Initial Purchasers set forth in Section 8 of the Purchase Agreement.
Capitalized terms used herein and not otherwise defined shall have the meaning
assigned to them in the Indenture, dated February 11, 1998, between the Company
and The Chase Manhattan Bank, as Trustee, relating to the Series A Notes and
the Series B Notes (the "INDENTURE").
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have
the following meanings:
Act: The Securities Act of 1933, as amended.
Affiliate: As defined in Rule 144 of the Act.
Broker-Dealer: Any broker or dealer registered under the Exchange
Act.
Certificated Securities: Definitive Notes, as defined in the
Indenture.
Closing Date: The date hereof.
Commission: The Securities and Exchange Commission.
Consummate: An Exchange Offer shall be deemed "Consummated" for
purposes of this Agreement upon the occurrence of (a) the filing and
effectiveness under the Act of the Exchange Offer Registration Statement
relating to the Series B Notes to be issued in the Exchange Offer, (b) the
maintenance of such Exchange Offer Registration Statement continuously
effective and the keeping of the Exchange Offer open for a period not less than
the period required pursuant to Section 3(b) hereof and (c) the delivery by the
Company to the Registrar under the Indenture of Series B Notes in the same
aggregate principal amount as the aggregate principal amount of Series A Notes
tendered by Holders thereof pursuant to the Exchange Offer.
<PAGE>
Effectiveness Deadline: As defined in Section 3(a) and 4(a) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Offer: The exchange and issuance by the Company of a
principal amount of Series B Notes (which shall be registered pursuant to the
Exchange Offer Registration Statement) equal to the outstanding principal
amount of Series A Notes that are tendered by such Holders in connection with
such exchange and issuance.
Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
Exempt Resales: The transactions in which the Initial Purchasers
propose to sell the Series A Notes to certain "qualified institutional buyers,"
as such term is defined in Rule 144A under the Act and pursuant to Regulation S
under the Act.
Filing Deadline: As defined in Sections 3(a) and 4(a) hereof.
Holders: As defined in Section 2 hereof.
Indemnified Holder: As defined in Section 8(a) hereof.
Prospectus: The prospectus included in a Registration Statement at the
time such Registration Statement is declared effective, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.
Recommencement Date: As defined in Section 6(d) hereof.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of the Company and
the Guarantors relating to (a) an offering of Series B Notes pursuant to an
Exchange Offer or (b) the registration for resale of Transfer Restricted
Securities pursuant to the Shelf Registration Statement, in each case, (i) that
is filed pursuant to the provisions of this Agreement and (ii) including the
Prospectus included therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and material incorporated by
reference therein.
Regulation S: Regulation S promulgated under the Act.
Restricted Broker-Dealer: Any Broker-Dealer that holds Series B Notes
that were acquired in the Exchange Offer in exchange for Series A Notes that
such Broker-Dealer acquired for its own account as a result of market making
activities or other trading activities (other than Series A Notes acquired
directly from the Company or any of its affiliates).
- 2 -
<PAGE>
Rule 144: Rule 144 promulgated under the Act.
Series B Notes: The Company's 9-1/8% Senior Subordinated Notes due
2008 to be issued pursuant to the Indenture: (i) in the Exchange Offer or (ii)
as contemplated by Section 4 hereof.
Shelf Registration Statement: As defined in Section 4 hereof.
Suspension Notice: As defined in Section 6(d) hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb)
as in effect on the date of the Indenture.
Transfer Restricted Securities: Each Note, until the earliest to occur
of (a) the date on which such Note is exchanged in the Exchange Offer and
entitled to be resold to the public by the Holder thereof without complying
with the prospectus delivery requirements of the Act, (b) the date on which
such Note has been disposed of in accordance with a Shelf Registration
Statement, (c) the date on which such Note is disposed of by a Broker-Dealer
pursuant to the "Plan of Distribution" contemplated by the Exchange Offer
Registration Statement (including delivery of the Prospectus contained therein)
or (d) the date on which such Note is distributed to the public pursuant to
Rule 144 under the Act.
SECTION 2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted Securities
(each, a "Holder") whenever such Person owns Transfer Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
1. Unless the Exchange Offer shall not be permitted by applicable
federal law (after the procedures set forth in Section 6(a)(i) below have been
complied with), the Company and the Guarantors shall (i) cause the Exchange
Offer Registration Statement to be filed with the Commission as soon as
practicable after the Closing Date (the "EXCHANGE OFFER FILING DATE"), but in
no event later than 75 days after the Closing Date (such 75th day being the
"FILING DEADLINE"), (ii) use its best efforts to cause such Exchange Offer
Registration Statement to become effective at the earliest possible time, but
in no event later than 120 days after the Closing Date (such 120th day being
the "EFFECTIVENESS DEADLINE"), (iii) in connection with the foregoing, (A) file
all pre-effective amendments to such Exchange Offer Registration Statement as
may be necessary in order to cause it to become effective, (B) file, if
applicable, a post-effective amendment to such Exchange Offer Registration
Statement pursuant to Rule 430A under the Act and (C) cause all necessary
filings, if any, in connection with the registration and qualification of the
Series B Notes to be made under the Blue Sky laws of such jurisdictions as are
necessary to permit Consummation of the Exchange Offer, and (iv) upon the
effectiveness of such Exchange Offer Registration Statement, commence and
Consummate the Exchange Offer. The Exchange Offer shall be on the appropriate
form permitting registration of the Series B Notes to be offered in exchange
for the Series A Notes that are Transfer Restricted Securities and to permit
resales of Series B Notes by Broker-Dealers that tendered into
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the Exchange Offer for Series A Notes that such Broker-Dealer acquired for its
own account as a result of market making activities or other trading activities
(other than Series A Notes acquired directly from the Company or any of its
Affiliates) as contemplated by Section 3(c) below.
2. The Company and the Guarantors shall use their respective best
efforts to cause the Exchange Offer Registration Statement to be effective
continuously, and shall keep the Exchange Offer open for a period of not less
than the minimum period required under applicable federal and state securities
laws to Consummate the Exchange Offer; provided, however, that in no event
shall such period be less than 20 Business Days. The Company and the Guarantors
shall cause the Exchange Offer to comply with all applicable federal and state
securities laws. No securities other than the Series B Notes shall be included
in the Exchange Offer Registration Statement. The Company and the Guarantors
shall use their respective reasonable best efforts to cause the Exchange Offer
to be Consummated on the earliest practicable date after the Exchange Offer
Registration Statement has become effective, but in no event later than 30
Business Days thereafter.
3. The Company shall include a "Plan of Distribution" section in the
Prospectus contained in the Exchange Offer Registration Statement and indicate
therein that any Broker-Dealer who holds Transfer Restricted Securities that
were acquired for the account of such Broker-Dealer as a result of
market-making activities or other trading activities (other than Transfer
Restricted Securities acquired directly from the Company or any Affiliate of
the Company), may exchange such Transfer Restricted Securities pursuant to the
Exchange Offer; however, such Broker-Dealer may be deemed to be an
"underwriter" within the meaning of the Act and must, therefore, deliver a
prospectus meeting the requirements of the Act in connection with its initial
sale of any Series B Notes received by such Broker-Dealer in the Exchange Offer
and that the Prospectus contained in the Exchange Offer Registration Statement
may be used to satisfy such prospectus delivery requirement. Such "Plan of
Distribution" section shall also contain all other information with respect to
such sales by such Broker-Dealers that the Commission may require in order to
permit such sales pursuant thereto, but such "Plan of Distribution" shall not
name any such Broker-Dealer or disclose the amount of Transfer Restricted
Securities held by any such Broker-Dealer, except to the extent required by the
Commission as a result of a change in policy, rules or regulations after the
date of this Agreement. See the Shearman & Sterling no-action letter (available
July 2, 1993).
To the extent necessary to ensure that the Exchange Offer Registration
Statement is available for sales of Series B Notes by Broker-Dealers, the
Company and the Guarantors agree to use their respective best efforts to keep
the Exchange Offer Registration Statement continuously effective, supplemented
and amended as required by the provisions of Section 6(c) hereof and in
conformity with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of 180 days from the date on which the Exchange Offer is Registration
Statement is declared effective, or such shorter period as will terminate when
all Transfer Restricted Securities covered by such Registration Statement have
been sold pursuant thereto. The Company and the Guarantors shall promptly
provide sufficient copies of the latest version of such Prospectus to such
Broker-Dealers promptly upon request, and in no event later than one day after
such request, at any time during such period.
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SECTION 4. SHELF REGISTRATION
1. Shelf Registration. If (i) the Exchange Offer is not permitted by
applicable law (after the Company and the Guarantors have complied with the
procedures set forth in Section 6(a)(i) below) or (ii) if any Holder of
Transfer Restricted Securities shall notify the Company within 20 Business Days
following the Consummation of the Exchange Offer that (A) such Holder was
prohibited by law or Commission policy from participating in the Exchange Offer
or (B) such Holder may not resell the Series B Notes acquired by it in the
Exchange Offer to the public without delivering a prospectus and the Prospectus
contained in the Exchange Offer Registration Statement is not appropriate or
available for such resales by such Holder or (C) such Holder is a Broker-Dealer
and holds Series A Notes acquired directly from the Company or any of its
Affiliates, then the Company and the Guarantors shall:
(x) cause to be filed, on or prior to 30 days after the earlier of (i)
the date on which the Company determines that the Exchange Offer Registration
Statement cannot be filed as a result of clause (a)(i) above and (ii) the date
on which the Company receives the notice specified in clause (a) (ii) above,
(such earlier date, the "FILING DEADLINE"), a shelf registration statement
pursuant to Rule 415 under the Act (which may be an amendment to the Exchange
Offer Registration Statement (the "SHELF REGISTRATION STATEMENT")), relating to
all Transfer Restricted Securities the Holders of which shall have provided the
information required pursuant to Section 4(b) hereof, and
(y) shall use their respective reasonable best efforts to cause such
Shelf Registration Statement to become effective on or prior to 90 days after
the Filing Deadline (such 90th day the "EFFECTIVENESS DEADLINE").
If, after the Company has filed an Exchange Offer Registration
Statement that satisfies the requirements of Section 3(a) above, the Company is
required to file and make effective a Shelf Registration Statement solely
because the Exchange Offer is not permitted under applicable federal law, then
the filing of the Exchange Offer Registration Statement shall be deemed to
satisfy the requirements of clause (x) above; provided that, in such event, the
Company shall remain obligated to meet the Effectiveness Deadline set forth in
clause (y).
The Company and the Guarantors shall use their respective reasonable
best efforts to keep any Shelf Registration Statement required by this Section
4(a) continuously effective, supplemented and amended as required by and
subject to the provisions of Sections 6(b) and (c) hereof to the extent
necessary to ensure that it is available for sales of Transfer Restricted
Securities by the Holders thereof entitled to the benefit of this Section 4(a),
and to ensure that it conforms with the requirements of this Agreement, the Act
and the policies, rules and regulations of the Commission as announced from
time to time, for a period of at least two years (as extended pursuant to
Section 6(c)(i)) following the date on which such Shelf Registration Statement
first becomes effective under the Act, or such shorter period as will terminate
when all Transfer Restricted Securities covered by such Registration Statement
have been sold pursuant thereto.
2. Provision by Holders of Certain Information in Connection with the
Shelf Registration Statement. No Holder of Transfer Restricted Securities may
include any of its Transfer
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Restricted Securities in any Shelf Registration Statement pursuant to this
Agreement unless and until such Holder furnishes to the Company in writing,
within 20 days after receipt of a request therefor, the information specified
in Item 507 or 508 of Regulation S-K, as applicable, of the Act for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. No Holder of Transfer Restricted Securities shall
be entitled to liquidated damages pursuant to Section 5 hereof unless and until
such Holder shall have provided all such information. Each selling Holder
agrees to promptly furnish additional information required to be disclosed in
order to make the information previously furnished to the Company by such
Holder not materially misleading.
SECTION 5. LIQUIDATED DAMAGES
If (i) any Registration Statement required by this Agreement is not
filed with the Commission on or prior to the applicable Filing Deadline, (ii)
any such Registration Statement has not been declared effective by the
Commission on or prior to the applicable Effectiveness Deadline, (iii) the
Exchange Offer has not been Consummated within 30 Business Days after the
Exchange Offer Registration Statement is first declared effective by the
Commission or (iv) any Registration Statement required by this Agreement is
filed and declared effective but shall thereafter cease to be effective or fail
to be usable for its intended purpose without being succeeded within two
Business Days by a post-effective amendment to such Registration Statement that
cures such failure and that is itself declared effective within two Business
Days of its filing (each such event referred to in clauses (i) through (iv), a
"Registration Default"), then the Company and the Guarantors hereby jointly and
severally agree to pay to each Holder of Transfer Restricted Securities
affected thereby liquidated damages in an amount equal to $.05 per week per
$1,000 in principal amount of Transfer Restricted Securities held by such
Holder for each week or portion thereof that the Registration Default continues
for the first 90-day period immediately following the occurrence of such
Registration Default. The amount of the liquidated damages shall increase by an
additional $.05 per week per $1,000 in principal amount of Transfer Restricted
Securities with respect to each subsequent 90-day period until all Registration
Defaults have been cured, up to a maximum amount of liquidated damages of $.50
per week per $1,000 in principal amount of Transfer Restricted Securities;
provided that the Company and the Guarantors shall in no event be required to
pay liquidated damages for more than one Registration Default at any given
time. Notwithstanding anything to the contrary set forth herein, (1) upon
filing of the Exchange Offer Registration Statement (and/or, if applicable, the
Shelf Registration Statement), in the case of (i) above, (2) upon the
effectiveness of the Exchange Offer Registration Statement (and/or, if
applicable, the Shelf Registration Statement), in the case of (ii) above, (3)
upon Consummation of the Exchange Offer, in the case of (iii) above, or (4)
upon the filing of a post-effective amendment to the Registration Statement or
an additional Registration Statement that causes the Exchange Offer
Registration Statement (and/or, if applicable, the Shelf Registration
Statement) to again be declared effective or made usable in the case of (iv)
above, the liquidated damages payable with respect to the Transfer Restricted
Securities as a result of such clause (i), (ii), (iii) or (iv), as applicable,
shall cease.
All accrued liquidated damages shall be paid to the Holders entitled
thereto, in the manner provided for the payment of interest in the Indenture,
on each Interest Payment Date, as more fully set forth in the Indenture and the
Notes. All obligations of the Company and the Guarantors set forth
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in the preceding paragraph that are outstanding with respect to any Transfer
Restricted Security at the time such security ceases to be a Transfer
Restricted Security shall survive until such time as all such obligations with
respect to such Security shall have been satisfied in full.
SECTION 6. REGISTRATION PROCEDURES
1. Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company and the Guarantors shall comply with all applicable
provisions of Section 6(c) below, shall use their respective best efforts to
effect such exchange and to permit the resale of Series B Notes by
Broker-Dealers that tendered in the Exchange Offer Series A Notes that such
Broker-Dealer acquired for its own account as a result of its market making
activities or other trading activities (other than Series A Notes acquired
directly from the Company or any of its Affiliates) being sold in accordance
with the intended method or methods of distribution thereof, and shall comply
with all of the following provisions:
7. If, following the date hereof there has been announced a
change in Commission policy with respect to exchange offers such as
the Exchange Offer that, in the reasonable opinion of counsel to the
Company raises a substantial question as to whether the Exchange Offer
is permitted by applicable federal law, the Company and the Guarantors
hereby agree to seek a no-action letter or other favorable decision
from the Commission allowing the Company and the Guarantors to
Consummate an Exchange Offer for such Transfer Restricted Securities.
The Company and the Guarantors hereby agree to pursue the issuance of
such a decision to the Commission staff level but shall not be
required to take commercially unreasonable action to effect a change
in Commission policy. In connection with the foregoing, the Company
and the Guarantors hereby agree to take all such other actions as may
be requested by the Commission or otherwise required in connection
with the issuance of such decision, including without limitation (A)
participating in telephonic conferences with the Commission, (B)
delivering to the Commission staff an analysis prepared by counsel to
the Company setting forth the legal bases, if any, upon which such
counsel has concluded that such an Exchange Offer should be permitted
and (C) diligently pursuing a resolution (which need not be favorable)
by the Commission staff.
8. As a condition to its participation in the Exchange Offer,
each Holder of Transfer Restricted Securities (including, without
limitation, any Holder who is a Broker Dealer) shall furnish, upon the
request of the Company, prior to the Consummation of the Exchange
Offer, a written representation to the Company and the Guarantors
(which may be contained in the letter of transmittal contemplated by
the Exchange Offer Registration Statement) to the effect that (A) it
is not an Affiliate of the Company, (B) it is not engaged in, and does
not intend to engage in, and has no arrangement or understanding with
any person to participate in, a distribution of the Series B Notes to
be issued in the Exchange Offer and (C) it is acquiring the Series B
Notes in its ordinary course of business. In addition, all such
Holders of Transfer Restricted Securities shall otherwise reasonably
cooperate with any reasonable request of the Company relating to the
Company's and Guarantors' preparation of the Exchange Offer
Registration Statement. Each Holder using the Exchange Offer to
participate in a distribution of the Series B Notes hereby
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acknowledges and agrees that, if the resales are of Series B Notes
obtained by such Holder in exchange for Series A Notes acquired
directly from the Company or an Affiliate thereof, it (1) could not,
under Commission policy as in effect on the date of this Agreement,
rely on the position of the Commission enunciated in Morgan Stanley
and Co., Inc. (available June 5, 1991) and Exxon Capital Holdings
Corporation (available May 13, 1988), as interpreted in the
Commission's letter to Shearman & Sterling dated July 2, 1993, and
similar no-action letters (including, if applicable, any no-action
letter obtained pursuant to clause (i) above), and (2) must comply
with the registration and prospectus delivery requirements of the Act
in connection with a secondary resale transaction and that such a
secondary resale transaction must be covered by an effective
registration statement containing the selling security holder
information required by Item 507 or 508, as applicable, of Regulation
S-K.
9. Prior to effectiveness of the Exchange Offer Registration
Statement, the Company and the Guarantors shall provide a supplemental
letter to the Commission (A) stating that the Company and the
Guarantors are registering the Exchange Offer in reliance on the
position of the Commission enunciated in Exxon Capital Holdings
Corporation (available May 13, 1988), Morgan Stanley and Co., Inc.
(available June 5, 1991) as interpreted in the Commission's letter to
Shearman & Sterling dated July 2, 1993, and, if applicable, any no-
action letter obtained pursuant to clause (i) above, (B) including a
representation that neither the Company nor any Guarantor has entered
into any arrangement or understanding with any Person to distribute
the Series B Notes to be received in the Exchange Offer and that, to
the best of the Company's and each Guarantor's information and belief,
each Holder participating in the Exchange Offer is acquiring the
Series B Notes in its ordinary course of business and has no
arrangement or understanding with any Person to participate in the
distribution of the Series B Notes received in the Exchange Offer and
(C) any other undertaking or representation required by the Commission
as set forth in any no-action letter obtained pursuant to clause (i)
above, if applicable.
2. Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company and the Guarantors shall comply with all
the provisions of Section 6(c) below and shall use their respective reasonable
best efforts to effect such registration to permit the sale of the Transfer
Restricted Securities being sold in accordance with the intended method or
methods of distribution thereof (as indicated in the information furnished to
the Company pursuant to Section 4(b) hereof), and pursuant thereto the Company
and the Guarantors will prepare and file with the Commission a Registration
Statement relating to the registration on any appropriate form under the Act,
which form shall be available for the sale of the Transfer Restricted
Securities in accordance with the intended method or methods of distribution
thereof, within the time periods and otherwise in accordance with the
provisions hereof.
3. General Provisions. In connection with any Registration Statement
and any related Prospectus required by this Agreement, the Company and the
Guarantors shall:
(i) use their respective reasonable best efforts to keep such
Registration Statement continuously effective and provide all
requisite financial statements for the period
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specified in Section 3 or 4 of this Agreement, as applicable. Upon the
occurrence of any event that would cause any such Registration
Statement or the Prospectus contained therein (A) to contain a
material misstatement or omission or (B) not to be effective and
usable for resale of Transfer Restricted Securities during the period
required by this Agreement, the Company and the Guarantors shall file
promptly an appropriate amendment to such Registration Statement
curing such defect, and, if Commission review is required, use their
respective reasonable best efforts to cause such amendment to be
declared effective as soon as practicable. Notwithstanding the
foregoing, if the Board of Directors of the Company determines in good
faith that it is in the best interests of the Company and the
Guarantors not to disclose the existence of or facts surrounding any
proposed or pending material corporate transaction involving the
Company or the Guarantors, the Company and the Guarantors may allow
the Shelf Registration Statement or the Exchange Offer Registration
Statement to fail to be effective and usable as a result of such
nondisclosure for up to 120 days during the three year period of
effectiveness required by Section 4 hereof, but in no event (x) for
any period in excess of 45 consecutive days or (y) for more than 60
days in any calendar year, provided, that in the event the Exchange
Offer is Consummated, the Company and the Guarantors shall not allow
the Exchange Offer Registration Statement to fail to be effective and
usable for a period in excess of 30 days during the one year period of
effectiveness required by Section 3 hereof;
(ii) prepare and file with the Commission such amendments and
post-effective amendments to the applicable Registration Statement as
may be necessary to keep such Registration Statement effective for the
applicable period set forth in Section 3 or 4 hereof, as the case may
be; cause the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424
under the Act, and to comply fully with Rules 424, 430A and 462, as
applicable, under the Act in a timely manner; and comply with the
provisions of the Act with respect to the disposition of all
securities covered by such Registration Statement during the
applicable period in accordance with the intended method or methods of
distribution by the sellers thereof set forth in such Registration
Statement or supplement to the Prospectus;
(iii) advise the selling Holders promptly and, if requested
by such Persons, confirm such advice in writing, (A) when the
Prospectus or any Prospectus supplement or post-effective amendment
has been filed, and, with respect to any applicable Registration
Statement or any post-effective amendment thereto, when the same has
become effective, (B) of any request by the Commission for amendments
to the Registration Statement or amendments or supplements to the
Prospectus or for additional information relating thereto, (C) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement under the Act or of the
suspension by any state securities commission of the qualification of
the Transfer Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of the
preceding purposes, (D) of the existence of any fact or the happening
of any event that makes any statement of a material fact made in the
Registration Statement, the Prospectus, any amendment or supplement
thereto or any document incorporated by reference therein untrue, or
that requires the making of any additions to or changes in the
Registration Statement in order to make the statements
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therein not misleading, or that requires the making of any additions
to or changes in the Prospectus in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading. If at any time the Commission shall issue any stop
order suspending the effectiveness of the Registration Statement, or
any state securities commission or other regulatory authority shall
issue an order suspending the qualification or exemption from
qualification of the Transfer Restricted Securities under state
securities or Blue Sky laws, the Company and the Guarantors shall use
their respective reasonable best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time;
(iv) subject to Section 6(c)(i), if any fact or event
contemplated by Section 6(c)(iii)(D) above shall exist or have
occurred, prepare a supplement or post-effective amendment to the
Registration Statement or related Prospectus or any document
incorporated therein by reference or file any other required document
so that, as thereafter delivered to the purchaser(s) of Transfer
Restricted Securities, the Prospectus will not contain an untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(v) furnish to the Initial Purchasers and each selling Holder
named in any Registration Statement or Prospectus in connection with
such sale, if any, before filing with the Commission, copies of any
Registration Statement or any Prospectus included therein or any
amendments or supplements to any such Registration Statement or
Prospectus (including all documents incorporated by reference after
the initial filing of such Registration Statement), which documents
will be subject to the review and comment of such Holders in
connection with such sale, if any, for a period of at least three
Business Days, and the Company will not file any such Registration
Statement or Prospectus or any amendment or supplement to any such
Registration Statement or Prospectus (including all such documents
incorporated by reference) to which the selling Holders of the
Transfer Restricted Securities covered by such Registration Statement
in connection with such sale, if any, shall reasonably object within
three Business Days after the receipt thereof. A selling Holder shall
be deemed to have reasonably objected to such filing if such
Registration Statement, amendment, Prospectus or supplement, as
applicable, as proposed to be filed, contains a material misstatement
or omission or fails to comply with the applicable requirements of the
Act;
(vi) promptly prior to the filing of any document that is to
be incorporated by reference into a Registration Statement or
Prospectus, provide copies of such document to the selling Holders in
connection with such sale, if any, make the Company's and the
Guarantors' representatives available for discussion of such document
and other customary due diligence matters, and include such
information in such document prior to the filing thereof as such
selling Holders may reasonably request;
(vii) make available at reasonable times for inspection by
the selling Holders participating in any disposition pursuant to such
Registration Statement and any attorney or accountant retained by such
selling Holders, all financial and other records, pertinent corporate
documents of the Company and the Guarantors and cause the Company's
and the
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Guarantors' officers, directors and employees to supply all
information reasonably requested by any such selling Holder, attorney
or accountant in connection with such Registration Statement or any
post-effective amendment thereto subsequent to the filing thereof and
prior to its effectiveness;
(viii) if requested by any selling Holders in connection with
such sale, if any, promptly include in any Registration Statement or
Prospectus, pursuant to a supplement or post-effective amendment if
necessary, such information as such selling Holders may reasonably
request to have included therein, including, without limitation,
information relating to the "Plan of Distribution" of the Transfer
Restricted Securities; and make all required filings of such
Prospectus supplement or post-effective amendment as soon as
practicable after the Company is notified of the matters to be
included in such Prospectus supplement or post-effective amendment;
(ix) furnish to each selling Holder in connection with such
sale, if any, without charge, at least one copy of the Registration
Statement, as first filed with the Commission, and of each amendment
thereto, including all documents incorporated by reference therein and
all exhibits (including exhibits incorporated therein by reference);
(x) deliver to each selling Holder, without charge, as many
copies of the Prospectus (including each preliminary prospectus) and
any amendment or supplement thereto as such Persons reasonably may
request; the Company and the Guarantors hereby consent to the use (in
accordance with law) of the Prospectus and any amendment or supplement
thereto by each of the selling Holders in connection with the offering
and the sale of the Transfer Restricted Securities covered by the
Prospectus or any amendment or supplement thereto;
(xi) upon the request of any selling Holder, enter into such
agreements (including underwriting agreements) and make such
representations and warranties and take all such other actions in
connection therewith in order to expedite or facilitate the
disposition of the Transfer Restricted Securities pursuant to any
applicable Registration Statement contemplated by this Agreement as
may be reasonably requested by any Holder of Transfer Restricted
Securities in connection with any sale or resale pursuant to any
applicable Registration Statement and in such connection, the Company
and the Guarantors shall:
(A) upon request of any selling Holder, furnish (or
in the case of paragraphs (2) and (3), use its reasonable best efforts
to cause to be furnished) to each selling Holder, upon the
effectiveness of the Shelf Registration Statement or upon Consummation
of the Exchange Offer, as the case may be:
(1) (1) a certificate, dated such date, signed on
behalf of the Company and each Guarantor by (x) the President or any
Vice President and (y) a principal financial or accounting officer of
the Company and such Guarantor, confirming, as of the date thereof,
the matters set forth in paragraphs (b), (d) and (e) and the second
sentence of
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paragraph (c) of Section 8 of the Purchase Agreement and such other
similar matters as the selling Holders may reasonably request;
(2) an opinion, dated the date of Consummation of
the Exchange Offer, or the date of effectiveness of the Shelf
Registration Statement, as the case may be, of counsel for the Company
and the Guarantors covering matters similar to those set forth in
paragraph (h) of Section 8 of the Purchase Agreement and such other
matter as the selling Holders may reasonably request, and in any event
including a statement to the effect that such counsel has participated
in conferences with officers and other representatives of the Company
and the Guarantors, representatives of the independent public
accountants for the Company and the Guarantors and have considered the
matters required to be stated therein and the statements contained
therein, although such counsel has not independently verified the
accuracy, completeness or fairness of such statements; and that such
counsel advises that, on the basis of the foregoing (relying as to
materiality to the extent such counsel deems appropriate upon the
statements of officers and other representatives of the Company and
the Guarantors) no facts came to such counsel's attention that caused
such counsel to believe that the applicable Registration Statement
(except as to (a) financial statements, including the notes thereto,
(b) statistical data and (c) other financial and accounting data
(including, without limitation, the pro forma financial information),
in each case, included or omitted therefrom, as to which no belief
need be expressed), at the time such Registration Statement or any
post-effective amendment thereto became effective and, in the case of
the Exchange Offer Registration Statement, as of the date of
Consummation of the Exchange Offer, contained an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, or that the Prospectus (except as to (a) financial
statements, including the notes thereto, (b) statistical data and (c)
other financial and accounting data (including, without limitation,
the pro forma financial information), in each case, included or
omitted therefrom, as to which no belief need be expressed) contained
in such Registration Statement as of its date and, in the case of the
opinion dated the date of Consummation of the Exchange Offer, as of
the date of Consummation, contained an untrue statement of a material
fact or omitted to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading. Without limiting the foregoing, such
counsel may state further that such counsel assumes no responsibility
for, and has not independently verified, the accuracy, completeness or
fairness of the financial statements, notes and schedules and other
financial data included in any Registration Statement contemplated by
this Agreement or the related Prospectus; and
(3) a customary comfort letter, dated the date of
Consummation of the Exchange Offer, or as of the date of effectiveness
of the Shelf Registration Statement, as the case may be, from the
Company's independent accountants, in the customary form and covering
matters of the type customarily covered in comfort letters to
underwriters in connection with underwritten offerings, and affirming
the matters set forth in the comfort letters delivered pursuant to
Section 8(k) of the Purchase Agreement; and
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(B) deliver such other documents and certificates as may be
reasonably requested by the selling Holders to evidence compliance
with clause (A) above and with any customary conditions contained in
the Purchase Agreement entered into by the Company and the Guarantors
pursuant to this clause (xi), if any;
(xii) prior to any public offering of Transfer Restricted
Securities, cooperate with the selling Holders and their counsel in
connection with the registration and qualification of the Transfer
Restricted Securities under the securities or Blue Sky laws of such
jurisdictions as the selling Holders may request and do any and all
other acts or things necessary or advisable to enable the disposition
in such jurisdictions of the Transfer Restricted Securities covered by
the applicable Registration Statement; provided, however, that neither
the Company nor any Guarantor shall be required to register or qualify
as a foreign corporation where it is not now so qualified or to take
any action that would subject it to the service of process in suits or
to taxation, other than as to matters and transactions relating to the
Registration Statement, in any jurisdiction where it is not now so
subject;
(xiii) issue, upon the request of any Holder of Series A
Notes covered by any Shelf Registration Statement contemplated by this
Agreement, Series B Notes having an aggregate principal amount equal
to the aggregate principal amount of Series A Notes surrendered to the
Company by such Holder in exchange therefor or being sold by such
Holder; such Series B Notes to be registered in the name of such
Holder or in the name of the purchaser(s) of such Series B Notes, as
the case may be; in return, the Series A Notes held by such Holder
shall be surrendered to the Company for cancellation;
(xiv) in connection with any sale of Transfer Restricted
Securities that will result in such securities no longer being
Transfer Restricted Securities, cooperate with the selling Holders to
facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Securities to be sold and not bearing
any restrictive legends; and to register such Transfer Restricted
Securities in such denominations and such names as the selling Holders
may request at least two Business Days prior to such sale of Transfer
Restricted Securities;
(xv) use their respective reasonable best efforts to cause
the disposition of the Transfer Restricted Securities covered by the
Registration Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the
seller or sellers thereof to consummate the disposition of such
Transfer Restricted Securities, subject to the proviso contained in
clause (xii) above;
(xvi) provide a CUSIP number for all Transfer Restricted
Securities not later than the effective date of a Registration
Statement covering such Transfer Restricted Securities and provide the
Trustee under the Indenture with printed certificates for the Transfer
Restricted Securities which are in a form eligible for deposit with
the Depository Trust Company;
(xvii) otherwise use their respective reasonable best efforts
to comply with all applicable rules and regulations of the Commission,
and make generally available to its
- 13 -
<PAGE>
security holders with regard to any applicable Registration Statement,
as soon as practicable, a consolidated earnings statement meeting the
requirements of Rule 158 (which need not be audited) covering a
twelve-month period beginning after the effective date of the
Registration Statement (as such term is defined in paragraph (c) of
Rule 158 under the Act);
(xviii) cause the Indenture to be qualified under the TIA not
later than the effective date of the first Registration Statement
required by this Agreement and, in connection therewith, cooperate
with the Trustee and the Holders to effect such changes to the
Indenture as may be required for such Indenture to be so qualified in
accordance with the terms of the TIA; and execute and use its best
efforts to cause the Trustee to execute, all documents that may be
required to effect such changes and all other forms and documents
required to be filed with the Commission to enable such Indenture to
be so qualified in a timely manner; and
(xix) provide promptly to each Holder upon request each
document filed with the Commission pursuant to the requirements of
Section 13 or Section 15(d) of the Exchange Act.
4. Restrictions on Holders. Each Holder agrees by acquisition of a
Transfer Restricted Security that, upon receipt of the notice referred to in
Section 6(c)(i) or any notice from the Company of the existence of any fact of
the kind described in Section 6(c)(iii)(D) hereof (in each case, a "SUSPENSION
NOTICE"), such Holder will forthwith discontinue disposition of Transfer
Restricted Securities pursuant to the applicable Registration Statement until
(i) such Holder's has received copies of the supplemented or amended Prospectus
contemplated by Section 6(c)(iv) hereof, or (ii) such Holder is advised in
writing by the Company that the use of the Prospectus may be resumed, and has
received copies of any additional or supplemental filings that are incorporated
by reference in the Prospectus (in each case, the "RECOMMENCEMENT DATE"). Each
Holder receiving a Suspension Notice hereby agrees that it will either (i)
destroy any Prospectuses, other than permanent file copies, then in such
Holder's possession which have been replaced by the Company with more recently
dated Prospectuses or (ii) deliver to the Company (at the Company's expense)
all copies, other than permanent file copies, then in such Holder's possession
of the Prospectus covering such Transfer Restricted Securities that was current
at the time of receipt of the Suspension Notice. The time period regarding the
effectiveness of such Registration Statement set forth in Section 3 or 4
hereof, as applicable, shall be extended by a number of days equal to the
number of days in the period from and including the date of delivery of the
Suspension Notice to the date of delivery of the Recommencement Date.
SECTION 10. REGISTRATION EXPENSES
1. All expenses incident to the Company's and the Guarantors'
performance of or compliance with this Agreement will be borne by the Company,
regardless of whether a Registration Statement becomes effective, including
without limitation: (i) all registration and filing fees and expenses; (ii) all
fees and expenses of compliance with federal securities and state Blue Sky or
securities laws; (iii) all expenses of printing (including printing
certificates for the Series B Notes to be issued in the Exchange Offer and
printing of Prospectuses), messenger and delivery services
- 14 -
<PAGE>
and telephone; (iv) all fees and disbursements of counsel for the Company, the
Guarantors and the Holders of Transfer Restricted Securities; (v) all
application and filing fees in connection with listing the Series B Notes on a
national securities exchange or automated quotation system pursuant to the
requirements hereof; and (vi) all fees and disbursements of independent
certified public accountants of the Company and the Guarantors (including the
expenses of any special audit and comfort letters required by or incident to
such performance) but specifically excluding any transfer fees and taxes, if
any, relating to the sale and disposition of Transfer Restricted Securities by
any Holder.
The Company will, in any event, bear its and the Guarantors' internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expenses of
any annual audit and the fees and expenses of any Person, including special
experts, retained by the Company or the Guarantors.
2. In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Company and the Guarantors
will reimburse the Purchasers and the Holders of Transfer Restricted Securities
being tendered in the Exchange Offer and/or resold pursuant to the "Plan of
Distribution" contained in the Exchange Offer Registration Statement or
registered pursuant to the Shelf Registration Statement, as applicable, for the
reasonable fees and disbursements of not more than one counsel, who shall be
Latham & Watkins, unless another firm shall be chosen by the Holders of a
majority in principal amount of the Transfer Restricted Securities for whose
benefit such Registration Statement is being prepared; provided that such fees
and disbursements shall not exceed $25,000.
SECTION 11. INDEMNIFICATION
1. The Company and the Guarantors agree, jointly and severally, to
indemnify and hold harmless (i) each Holder and (ii) each person, if any, who
controls (within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act) any Holder (any of the persons referred to in this clause (ii)
being hereinafter referred to as a "controlling person") and (iii) the
respective officers, directors, partners, employees, representatives and agents
of any Holder or any controlling person (any person referred to in clause (i),
(ii) or (iii) may hereinafter be referred to as an "INDEMNIFIED HOLDER"), from
and against any and all losses, claims, damages, liabilities, judgments,
(including without limitation, any legal or other expenses incurred in
connection with investigating or defending any matter, including any action
that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement, preliminary prospectus
or Prospectus (or any amendment or supplement thereto) provided by the Company
to any holder or any prospective purchaser of Series B Notes, or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by an untrue statement or omission or alleged untrue statement or
omission that is based upon information furnished in writing to the Company by
any of the Holders.
- 15 -
<PAGE>
2. Each Holder of Transfer Restricted Securities agrees, severally and
not jointly, to indemnify and hold harmless the Company and the Guarantors, and
their respective directors, and officers, partners, employees, representatives
and agents and each person, if any, who controls (within the meaning of Section
15 of the Act or Section 20 of the Exchange Act) the Company, or the Guarantors
to the same extent as the foregoing indemnity from the Company and the
Guarantors to each of the Indemnified Holders, but only with reference to
information relating to such Indemnified Holder furnished in writing to the
Company by such Indemnified Holder expressly for use in any Registration
Statement. In no event shall any Indemnified Holder be liable or responsible
for any amount in excess of the amount by which the total amount received by
such Indemnified Holder with respect to its sale of Transfer Restricted
Securities pursuant to a Registration Statement exceeds (i) the amount paid by
such Indemnified Holder for such Transfer Restricted Securities and (ii) the
amount of any damages that such Indemnified Holder has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission.
3. In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 8(a) or 8(b) (the
"INDEMNIFIED PARTY"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "INDEMNIFYING PERSON") in
writing and the indemnifying party shall assume the defense of such action,
including the employment of counsel reasonably satisfactory to the indemnified
party and the payment of all fees and expenses of such counsel, as incurred
(except that in the case of any action in respect of which indemnity may be
sought pursuant to both Sections 8(a) and 8(b), an Indemnified Holder shall not
be required to assume the defense of such action pursuant to this Section 8(c),
but may employ separate counsel and participate in the defense thereof, but the
fees and expenses of such counsel, except as provided below, shall be at the
expense of the Indemnified Holder). Any indemnified party shall have the right
to employ separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
the indemnified party unless (i) the employment of such counsel shall have been
specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party shall have failed to assume the defense of such action or
employ counsel reasonably satisfactory to the indemnified party or (iii) the
named parties to any such action (including any impleaded parties) include both
the indemnified party and the indemnifying party, and the indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party (in which case the indemnifying party shall
not have the right to assume the defense of such action on behalf of the
indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions arising out of the same general allegations or circumstances, be liable
for the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all indemnified parties and all such fees
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by a majority of the Indemnified Holders, in the case of
the parties indemnified pursuant to Section 8(a), and by the Company, in the
case of parties indemnified pursuant to Section 8(b). The indemnifying party
shall not be liable, shall not indemnify or hold harmless the indemnified party
from and against any and all losses, claims, damages, liabilities and judgments
by reason of any settlement of any action effected without its written consent.
No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement or compromise of, or consent to the
entry of
- 16 -
<PAGE>
judgment with respect to, any pending or threatened action in respect of which
the indemnified party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the indemnified
party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability on claims
that are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.
4. To the extent that the indemnification provided for in this Section
8 is unavailable to an indemnified party in respect of any losses, claims,
damages, liabilities or judgments referred to therein, then each indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or judgments (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Guarantors, on the one hand, and the Holders, on the other hand, from their
sale of Transfer Restricted Securities or (ii) if the allocation provided by
clause 8(d)(i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
8(d)(i) above but also the relative fault of the Company and the Guarantors, on
the one hand, and of the Indemnified Holder, on the other hand, in connection
with the statements or omissions which resulted in such losses, claims,
damages, liabilities or judgments, as well as any other relevant equitable
considerations. The relative fault of the Company and the Guarantors, on the
one hand, and of the Indemnified Holder, on the other hand, shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company or such Guarantor,
on the one hand, or by the Indemnified Holder, on the other hand, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid or payable by a
party as a result of the losses, claims, damages, liabilities and judgments
referred to above shall be deemed to include, subject to the limitations set
forth in the second paragraph of Section 8(a), any legal or other fees or
expenses reasonably incurred by such party in connection with investigating or
defending any action or claim.
The Company, the Guarantors and each Holder agree that it would not be
just and equitable if contribution pursuant to this Section 8(d) were
determined by pro rata allocation (even if the Holders were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or judgments referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any
matter, including any action that could have given rise to such losses, claims,
damages, liabilities or judgments. Notwithstanding the provisions of this
Section 8, no Holder or its related Indemnified Holders shall be required to
contribute, in the aggregate, any amount in excess of the amount by which the
total received by such Holder with respect to the sale of its Transfer
Restricted Securities pursuant to a Registration Statement exceeds the sum of
(A) the amount paid by such Holder for such Transfer Restricted Securities plus
(B) the amount of any damages which such Holder has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act)
- 17 -
<PAGE>
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Holders' obligations to contribute pursuant
to this Section 8(c) are several in proportion to the respective principal
amount of Transfer Restricted Securities held by each of the Holders hereunder
and not joint.
SECTION 12. RULE 144A
The Company and each Guarantor hereby agrees with each Holder, for so
long as any Transfer Restricted Securities remain outstanding and during any
period in which the Company or such Guarantor is not subject to Section 13 or
15(d) of the Securities Exchange Act, to make available, upon request of any
Holder of Transfer Restricted Securities, to any Holder or beneficial owner of
Transfer Restricted Securities in connection with any sale thereof and any
prospective purchaser of such Transfer Restricted Securities designated by such
Holder or beneficial owner, the information required by Rule 144A(d)(4) under
the Act in order to permit resales of such Transfer Restricted Securities
pursuant to Rule 144A.
SECTION 13. MISCELLANEOUS
1. Remedies. The Company and the Guarantors acknowledge and agree that
any failure by the Company and/or the Guarantors to comply with their
respective obligations under Sections 3 and 4 hereof may result in material
irreparable injury to the Initial Purchasers or the Holders for which there is
no adequate remedy at law, that it will not be possible to measure damages for
such injuries precisely and that, in the event of any such failure, the Initial
Purchasers or any Holder may obtain such relief as may be required to
specifically enforce the Company's and the Guarantor's obligations under
Sections 3 and 4 hereof. The Company and the Guarantors further agree to waive
the defense in any action for specific performance that a remedy at law would
be adequate.
2. No Inconsistent Agreements. Neither the Company nor any Guarantor
will, on or after the date of this Agreement, enter into any agreement with
respect to its securities that is inconsistent with the rights granted to the
Holders in this Agreement or otherwise conflicts with the provisions hereof.
Neither the Company nor any Guarantor has previously entered into any agreement
granting any registration rights with respect to its securities to any Person.
The rights granted to the Holders hereunder do not in any way conflict with and
are not inconsistent with the rights granted to the holders of the Company's
and the Guarantors' securities under any agreement in effect on the date
hereof.
3. Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to or departures
from the provisions hereof may not be given unless (i) in the case of Section 5
hereof and this Section 10(c)(i), the Company has obtained the written consent
of Holders of all outstanding Transfer Restricted Securities and (ii) in the
case of all other provisions hereof, the Company has obtained the written
consent of Holders of a majority of the outstanding principal amount of
Transfer Restricted Securities (excluding Transfer Restricted Securities held
by the Company of its Affiliates). Notwithstanding the foregoing, a waiver or
consent to departure from the provisions hereof that relates exclusively to the
rights of Holders whose securities are being tendered pursuant to the Exchange
Offer and that does not affect
- 18 -
<PAGE>
directly or indirectly the rights of other Holders whose securities are not
being tendered pursuant to such Exchange Offer may be given by the Holders of a
majority of the outstanding principal amount of Transfer Restricted Securities
subject to such Exchange Offer.
4. Third Party Beneficiary. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company and the
Guarantors, on the one hand, and the Initial Purchasers, on the other hand, and
shall have the right to enforce such agreements directly to the extent they may
deem such enforcement necessary or advisable to protect its rights or the
rights of Holders hereunder.
5. Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:
14. if to a Holder, at the address set forth on the records
of the Registrar under the Indenture, with a copy to the Registrar
under the Indenture; and
15. if to the Company or the Guarantors:
SFX Entertainment, Inc.
650 Madison Avenue
New York, New York 10022
Telecopier No.: (212) 753-3188
Attention: Howard J. Tytel, Esq.
With a copy to:
Baker & McKenzie
805 Third Avenue
New York, New York 10022
Telecopier No.: (212) 751-5700
Attention: Howard M. Berkower, Esq.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when
receipt acknowledged, if telecopied; and on the next business day, if timely
delivered to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
Upon the date of filing of the Exchange Offer or a Shelf Registration
Statement, as the case may be, notice shall be delivered to Lehman Brothers,
Inc., on behalf of the Initial Purchasers (in the form attached hereto as
Exhibit A) and shall be addressed to: Attention: Compliance Department, 3 World
Financial Center, New York, New York 10285.
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<PAGE>
1. Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without the need for an express assignment,
subsequent Holders of Transfer Restricted Securities; provided, that nothing
herein shall be deemed to permit any assignment, transfer or other disposition
of Transfer Restricted Securities in violation of the terms hereof or of the
Purchase Agreement or the Indenture. If any transferee of any Holder shall
acquire Transfer Restricted Securities in any manner, whether by operation of
law or otherwise, such Transfer Restricted Securities shall be held subject to
all of the terms of this Agreement, and by taking and holding such Transfer
Restricted Securities such Person shall be conclusively deemed to have agreed
to be bound by and to perform all of the terms and provisions of this
Agreement, including the restrictions on resale set forth in this Agreement
and, if applicable, the Purchase Agreement, and such Person shall be entitled
to receive the benefits hereof.
2. Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
3. Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
4. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.
5. Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
6. Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect
of the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted with respect to the Transfer
Restricted Securities. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
- 20 -
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
SFX ENTERTAINMENT, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: General Counsel, Executive
Vice President and Secretary
ATLANTA CONCERTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
ARDEE FESTIVALS N.J., INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
ARDEE PRODUCTIONS, LTD.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and
Secretary
BEACH CONCERTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
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<PAGE>
BGP ACQUISITION, LLC
By: SFX ENTERTAINMENT, INC.,
its managing member.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: General Counsel, Executive
Vice President and Secretary
BROADWAY CONCERTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONNECTICUT AMPHITHEATER DEVELOPMENT CORP.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONNECTICUT CONCERTS, INCORPORATED
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONNECTICUT PERFORMING ARTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
- 22 -
<PAGE>
CONNECTICUT PERFORMING ARTS PARTNERS
By: NOC, INC. its general partner.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONN TICKETING COMPANY
By: NORTHEAST TICKETING COMPANY,
its general partner.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
CONTEMPORARY GROUP ACQUISITION CORP.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
DEER CREEK AMPHITHEATER CONCERTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
DEER CREEK AMPHITHEATER CONCERTS, LP
By: DEER CREEK AMPHITHEATER CONCERTS, INC.,
its general partner.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
- 23 -
<PAGE>
DELSENER/SLATER ENTERPRISES, LTD.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
DUMB DEAL, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
EXIT 116 REVISITED, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
FPI CONCERTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
IN HOUSE TICKETS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
IRVING PLAZA CONCERTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Agent
- 24 -
<PAGE>
MURAT CENTER CONCERTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
MURAT CENTER CONCERTS, LP
By: MURAT CENTER CONCERTS, INC.,
its managing partner.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
NOC, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
NORTHEAST TICKETING COMPANY
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
POLARIS AMPHITHEATER CONCERTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
- 25 -
<PAGE>
QN CORP.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SFX BROADCASTING OF THE MIDWEST, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SFX CONCERTS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SFX NETWORK GROUP, LLC
By: SFX ENTERTAINMENT, INC.,
its managing member.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: General Counsel, Executive Vice
President and Secretary
SOUTHEAST TICKETING COMPANY
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
- 26 -
<PAGE>
SUNSHINE CONCERTS, LLC
By: SFX BROADCASTING OF THE MIDWEST, INC.,
its managing member.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SUNSHINE DESIGNS, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SUNSHINE DESIGNS, LP
By: SUNSHINE DESIGNS, INC., its general partner.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SUNTEX ACQUISITION, INC.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
SUNTEX ACQUISITION, LP
By: SUNTEX ACQUISITION, INC., its general partner.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: Executive Vice President and Secretary
- 27 -
<PAGE>
WESTBURY MUSIC FAIR, LLC
By: SFX ENTERTAINMENT, INC.,
its managing member.
By: /s/ Howard J. Tytel
------------------------------------
Name: Howard J. Tytel
Title: General Counsel, Executive Vice
President and Secretary
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<PAGE>
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
LEHMAN BROTHERS INC.
By: /s/ Edward B. McGeough
------------------------
Name: Edward B. McGeough
Title: Managing Director
/s/ (Goldman, Sachs & Co.)
--------------------------
(Goldman, Sachs & Co.)
BNY CAPITAL MARKETS, INC.
By: /s/ John Roy
------------------------
Name: John Roy
Title: Managing Director
ING BARINGS
By: /s/ Roy L. Furman
------------------------
Name: Roy L. Furman
Title: Vice Chairman
- 29 -
<PAGE>
EXHIBIT A
NOTICE OF FILING OF
A/B EXCHANGE OFFER REGISTRATION STATEMENT
To: Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285
Attention: Compliance Department
Fax: (212) 526-3738
From: SFX Entertainment Inc.
9-1/8% Senior Subordinated Notes due 2008
Date: _________, 199_
For your information only (NO ACTION REQUIRED):
Today, ______, 199_, we filed [an A/B Exchange Registration
Statement/a Shelf Registration Statement] with the Securities and Exchange
Commission. We currently expect this registration statement to be declared
effective within __ business days of the date hereof.
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EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Prospectuses
constituting part of the Registration Statements on Form S-8 (Nos. 333-41997,
333-26611 and 333-37519) and Form S-3 (Nos. 333-15469, 333-21127, 333-06793,
333-16995 and 333-29825) of SFX Broadcasting, Inc. ("SFX") of our report dated
February 20, 1997, except for Note 13, as to which the date is March 27, 1997,
with respect to SFX included in the Annual Report on Form 10-K of SFX for the
year ended December 31, 1996; and our reports dated (i) October 2, 1997 with
respect to Delsener/Slater Enterprises, Ltd. and Affiliated Companies; (ii)
December 13, 1996, except for Note 10, as to which the date is August 22, 1997,
with respect to PACE Entertainment Corporation and Subsidiaries; (iii) November
25, 1997 with respect to the Contemporary Group; (iv) November 20, 1997 with
respect to SJS Entertainment Corporation and Affiliated Company; (v) November
20, 1997 with respect to The Album Network, Inc. and Affiliated Companies; (vi)
December 18, 1997 with respect to BG Presents, Inc. and Subsidiaries; and (vii)
November 14, 1997 with respect to Concert/Southern Promotions and Affiliated
Companies, each included in Amendment No. 3 to the Registration Statement on
Form S-1 (File No. 333-43287) and related Prospectus of SFX Entertainment,
Inc., filed on February 11, 1998, incorporated by reference in this Current
Report on Form 8-K of SFX.
ERNST & YOUNG LLP
/s/ Ernst & Young LLP
New York, New York
February 13, 1998
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EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of
our report on the combined financial statements of Connecticut Performing Arts,
Inc. and Connecticut Performing Arts Partners dated March 21, 1997 included in
Amendment No. 3 to the Registration Statement on Form S-1 (File No. 333-43287)
and related Prospectus of SFX Entertainment, Inc., filed on February 11, 1998,
incorporated by reference in this Form 8-K and into SFX Broadcasting, Inc.'s
previously filed Registration Statements on Form S-8 (Nos. 333-41997, 333-26611
and 333-37519) and S-3 (Nos. 333-15469, 333-21127, 333-06793, 333-16995 and
333-29825).
ARTHUR ANDERSEN LLP
/s/ Arthur Andersen LLP
Hartford, Connecticut
February 13, 1998
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference of our report on the combined financial statements of Deer Creek
Partners, L.P. and Murat Centre, L.P. dated September 29, 1997 included in
Amendment No. 3 to the Registration Statement on Form S-1 (File No. 333-43287)
and related Prospectus of SFX Entertainment, Inc., filed on February 11, 1998,
into this Form 8-K and into SFX Broadcasting, Inc.'s previously filed
Registration Statements on Form S-8 (Nos. 333-41997, 333-26611 and 333-37519)
and S-3 (Nos. 333-15469, 333-21127, 333-06793, 333-16995 and 333-29825).
ARTHUR ANDERSEN LLP
/s/ Arthur Andersen LLP
Indianapolis, Indiana,
February 13, 1998
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of
our reports on the consolidated financial statements of PACE Entertainment
Corporation and subsidiaries dated December 15, 1997 (except with respect to
the matters discussed in Note 12, as to which the date is December 15, 1997
(except with respect to the matters discussed in Note 12, as to which the date
is December 22, 1997) and Pavilion Partners dated December 15, 1997 (except
with respect to the matters discussed in Note 11, as to which the date is
December 22, 1997), included in Amendment No. 3 to the Registration Statement
on Form S-1 (File No. 333-43287) and related Prospectus of SFX Entertainment,
Inc., filed on February 11, 1998, incorporated by reference in this Form 8-K
and into SFX Broadcasting, Inc.'s previously filed Registration Statements on
Form S-8 (Nos. 333-41997, 333-26611 and 333-37519) and S-3 (Nos. 333-15469,
333-21127, 333-16995 and 333-29825).
ARTHUR ANDERSEN LLP
/s/ Arthur Andersen LLP
Houston, Texas
February 13, 1998
<PAGE>
EXHIBIT 23.3
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectuses
constituting part of the Registration Statements on Form S-8 (Nos. 333-26611,
333-37519 and 333-41997) and Form S-3 (Nos. 333-06793, 333-15469, 333-16995,
333-21127, and 333-29825) of SFX Broadcasting, Inc. ("SFX") of our report
dated December 12, 1996 included in Amendment No. 3 to the Registration
Statement on Form S-1 (File No. 333-43287) of SFX Entertainment, Inc.,
filed on February 11, 1998, which, with the related Prospectus and financial
information, is incorporated by reference in this Form 8-K, such
Registration Statement and Prospectus include the financial statements
of Pavilion Partners as of September 30, 1996 and for the year ended
October 31, 1995 and the eleven months ended September 30, 1996.
/s/ Price Waterhouse
PRICE WATERHOUSE
Houston, Texas
February 13, 1998
<PAGE>
SFX BROADCASTING, INC. LETTERHEAD
(BW)(SFX-BROADCASTING)(SFXBA) SFX Broadcasting Announces Pricing Of SFX
Entertainment's $350 Million of Senior Subordinated Notes
NEW YORK--(BUSINESS WIRE)--Feb. 9, 1998--SFX Broadcasting, Inc. (NASDAQ:
SFXBA) announced today that its live entertainment unit, SFX Entertainment,
Inc., priced $350 million of Senior Subordinated Notes due 2008 at 9 1/8%, in
a privately placed transaction. The closing of the transaction is scheduled for
February 11, 1998. The issue, which was increased from $275 million, is
non-callable for five years, but does permit a call for 35% of the issue at
109 1/8% with funds provided by any future equity financing. It is anticipated
that SFX Entertainment will be spun off to SFX Broadcasting shareholders in the
second quarter of 1998.
SFX Entertainment intends to use the net proceeds of the offering,
together with borrowings from its $300 million senior credit facility, to
finance the cash consideration to be paid in its previously announced pending
acquisitions, to repay debt in connection with these acquisitions, to pay
certain related fees and expenses, to fund the planned 1998 capital
expenditures, and for general corporate purposes.
Robert F.X. Sillerman, Executive Chairman of SFX Broadcasting, said,
"We are pleased to have completed this important step in the financing of SFX
Entertainment. SFX Entertainment will begin operations as a public company
with a sound balance sheet giving us great flexibility to implement our
strategy."
The private offering has been made to qualified institutional buyers
pursuant to Rule 144A under the Securities Act of 1933 and pursuant to offers
and sales that occur outside the United States within the meaning under
Regulation S of the Securities Act of 1933. These securities have not been
registered under the Securities Act and may not be offered or sold in the
United States absent registration under the Securities Act or an exemption from
such registration. This press release shall not constitute an offer to sell or
the solicitation of an offer to buy nor shall there be any sale of the
securities in any state in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such state.
SFX Broadcasting, Inc. has previously announced that it entered into a
merger agreement with an affiliate of Hicks, Muse, Tate & Furst whereby SFX's
radio business will be acquired for cash consideration of $75 per share.
Additionally, the agreement contemplates that before the merger SFX will
spin-off to its current shareholders all of its assets related to the live
entertainment business in the new public company, SFX Entertainment, Inc. SFX
Entertainment currently consists of DelsenerSlater Enterprises, promoter for
many of the major concert venues in the New York City metropolitan area; a long
term leasehold interest in the Meadows Music Theater in Hartford, Connecticut;
and Sunshine Promotions, one of the largest concert promoters in the Midwest.
Upon consummation of its pending acquisitions of Bill Graham Presents,
Contemporary Group, Concert/Southern, the Network Magazine Group and SJS
Entertainment, and PACE Entertainment, SFX Entertainment will be one of the
largest producers and promoters of live entertainment in the country. SFX
Entertainment believes it will own and/or manage the nation's largest network
of live entertainment venues, consisting of amphitheaters, theaters and clubs,
either directly owned, under lease or under exclusive booking arrangements.
It will have 40 venues in 21 of the country's top 50 markets, including 9
amphitheaters in 6 of the top 10 markets. The company will also be a leading
promoter and producer of touring Broadway shows, and it will produce and
promote other live entertainment events such as specialized motor sports,
music festivals, comedy tours, skating shows and other special events.
CONTACT: Timothy J. Klahs
Director, Investor Relations
SFX Broadcasting, Inc.
212/407-9126
<PAGE>
SFX BROADCASTING, INC. LETTERHEAD
(BW)(SFX-BROADCASTING)(SFXBA) SFX Broadcasting Announces Closing of SFX
Entertainment's $350 Million of Senior Subordinated Notes
NEW YORK--(BUSINESS WIRE)--Feb. 13, 1998--SFX Broadcasting, Inc. (NASDAQ:
SFXBA) announced today that its live entertainment unit, SFX Entertainment,
Inc., closed on its privately placed $350 million of 9 1/8% Senior
Subordinated Notes due 2008. It is anticipated that SFX Entertainment will be
spun off to SFX Broadcasting shareholders in the second quarter of 1998. The
issue was managed by a group led by Lehman Brothers Inc.
Robert F.X. Sillerman, Executive Chairman of SFX Broadcasting, said, "We
are happy to have successfully closed this offering and are delighted by the
outstanding investor interest exhibited across the country during our
extensive road show. This financing, together with our new bank facility,
provides funds to close all of our pending acquisitions while providing
additional resources for entering into new attractive projects and
acquisitions which may become available. Going forward, we will have great
flexibility to implement our planned operating strategy all within a
framework of prudent financial leverage. We in senior management are
certainly looking forward to the challenge of delivering to all of our
investors in this new enterprise the same kind of financial rewards which we
have historically provided at SFX Broadcasting."
The private offering has been made to qualified institutional buyers
pursuant to Rule 144A under the Securities Act of 1933 and pursuant to offers
and sales that occur outside the United States within the meaning under
Regulation S of the Securities Act of 1933. These securities have not been
registered under the Securities Act and may not be offered or sold in the
United States absent registration under the Securities Act or an exemption
from such registration. This press release shall not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be any sale of
the securities in any state in which such offer, solicitation or sale would
be unlawful prior to registration or qualification under the securities laws
of any such state.
SFX Broadcasting, Inc. has previously announced that it entered into a
merger agreement with an affiliate of Hicks, Muse, Tate & Furst whereby SFX's
radio business will be acquired for cash consideration of $75 per share.
Additionally, the agreement contemplates that before the merger SFX will
spin-off to its current shareholders all of its assets related to the live
entertainment business in the new public company, SFX Entertainment, Inc. SFX
Entertainment currently consists of DelsenerSlater Enterprises, promoter for
many of the major concert venues in the New York City metropolitan area; a
long term leasehold interest in the Meadows Music Theater in Hartford,
Connecticut; and Sunshine Promotions, one of the largest concert promoters in
the Midwest. Upon consummation of its pending acquisitions of Bill Graham
Presents, Contemporary Group, Concert/Southern, the Network Magazine Group
and SJS Entertainment, and PACE Entertainment, SFX Entertainment will be one
of the largest producers and promoters of live entertainment in the country.
SFX Entertainment believes it will own and/or manage the nation's largest
network of live entertainment venues, consisting of amphitheaters, theaters
and clubs, either directly owned, under lease or under exclusive booking
arrangements. It will have 40 venues in 21 of the country's top 50 markets,
including 9 amphitheaters in 6 of the top 10 markets. The company will also
be a leading promoter and producer of touring Broadway shows, and it will
produce and promote other live entertainment events such as specialized motor
sports, music festivals, comedy tours, skating shows and other special
events.
CONTACT: SFX Broadcasting, Inc.
Timothy J. Klahs
Director, Investor Relations
212/407-9126
<PAGE>
Exhibit 99.4
SFX BROADCASTING ANNOUNCES CONSUMMATION
OF ITS CONSENT SOLICITATIONS
New York, February 13, 1998 -- SFX Broadcasting, Inc. (NASDAQ: SFXBA)
announced today the completion of the solicitations of consents (the "Consent
Solicitations") conducted pursuant to the consent solicitation statements
dated January 7, 1998, as supplemented on January 28, 1998, copies of which
were distributed to the holders of the Company's $450,000,000 10 3/4% Senior
Subordinated Notes due 2006 (the "Notes") and the Company's $225,000,000
12 5/8% Series E Cumulative Exchangeable Preferred Stock due October 31, 2006
(the "Shares").
On February 2, 1998, the Company executed the Supplemental Indenture setting
forth the proposed amendments to the Notes. On February 10, 1998, the Company
filed the Certificate of Designations setting forth the proposed amendments to
the Shares. On February 11, 1998, the Company paid the balance of the consent
fees to the holders of the Shares and the Notes. The Company delivered partial
payment of the consent fees to the holders of the Shares and the Notes on
February 4, 1998.
Contact: SFX Broadcasting, Inc.
Timothy J. Klahs
Director, Investor Relations
(212) 407-9126
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