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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
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): NOVEMBER 19, 1999
---------------------------
AMFM OPERATING INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 0-22486 13-3649750
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of incorporation) Identification Number)
600 CONGRESS AVENUE
SUITE 1400 78701
AUSTIN, TEXAS (Zip code)
(Address of principal
executive offices)
Registrant's telephone number, including area code: (512) 340-7800
CAPSTAR COMMUNICATIONS, INC.
(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
See Item 7(c)
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) EXHIBITS.
4.1 -- Indenture, dated as of November 19, 1999, governing
the 12 5/8% Senior Subordinated Exchange Debentures
due 2006, of AMFM Operating Inc.*
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* Filed herewith.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMFM OPERATING INC.
(Registrant)
By: /s/ W. Schuyler Hansen
--------------------------------
W. Schuyler Hansen
Senior Vice President and
Chief Accounting Officer
Date: November 19, 1999
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE
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<S> <C>
4.1 -- Indenture, dated as of November 19, 1999, governing the
12 5/8% Senior Subordinated Exchange Debentures due 2006, of
AMFM Operating Inc.*
</TABLE>
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* Filed herewith.
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EXHIBIT 4.1
AMFM OPERATING INC.
12 5/8% SENIOR SUBORDINATED EXCHANGE DEBENTURES DUE 2006
--------------------
INDENTURE
--------------------
UNITED STATES TRUST COMPANY OF NEW YORK
Trustee
Dated as of November 19, 1999
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CROSS-REFERENCE TABLE*
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
<S> <C>
310 (a)(1).................................................... 7.10
(a)(2).................................................... 7.10
(a)(3).................................................... N/A
(a)(4).................................................... N/A
(a)(5).................................................... 7.10
(b)....................................................... 7.10
(c)....................................................... N/A
311 (a)....................................................... 7.11
(b)....................................................... 7.11
(c)....................................................... N/A
312 (a)....................................................... 2.05
(b)....................................................... 11.03
(c)....................................................... 11.03
313 (a)....................................................... 7.06
(b)(1).................................................... N/A
(b)(2).................................................... 7.06
(c)....................................................... 7.06; 11.02
(d)....................................................... 7.06
314 (a)....................................................... 4.03; 4.04
(b)....................................................... N/A
(c)(1).................................................... 11.04
(c)(2).................................................... 11.04
(c)(3).................................................... N/A
(d)....................................................... N/A
(e)....................................................... 11.05
(f)....................................................... N/A
315 (a)....................................................... 7.02; 11.02
(b)....................................................... 7.05; 11.02
(c)....................................................... 7.01
(d)....................................................... 7.01
(e)....................................................... 6.11
316 (a)(last sentence)........................................ 2.09
(a)(1)(A)................................................. 6.05
(a)(1)(B)................................................. 6.04
(a)(2).................................................... N/A
(b)....................................................... 6.07
(c)....................................................... N/A
317 (a)(1).................................................... 6.08
(a)(2).................................................... 6.09
</TABLE>
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<TABLE>
<S> <C>
(b)...................................................... 2.04
318 (a)...................................................... 11.01
(b)...................................................... N/A
(c)...................................................... 11.01
</TABLE>
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N/A means not applicable.
* This Cross-Reference Table is not part of the Indenture.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions..................................................1
Section 1.02 Other Definitions...........................................14
Section 1.03 Incorporation by Reference of Trust Indenture Act...........14
Section 1.04 Rules of Construction.......................................15
ARTICLE 2
THE EXCHANGE DEBENTURES
Section 2.01 Form and Dating.............................................15
Section 2.02 Execution and Authentication................................16
Section 2.03 Registrar and Paying Agent..................................16
Section 2.04 Paying Agent to Hold Money in Trust.........................17
Section 2.05 Holder Lists................................................17
Section 2.06 Replacement Exchange Debentures.............................17
Section 2.07 Outstanding Exchange Debentures.............................18
Section 2.08 Treasury Exchange Debentures................................18
Section 2.09 Temporary Exchange Debentures...............................18
Section 2.10 Cancellation................................................19
Section 2.11 Defaulted Interest..........................................19
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee..........................................19
Section 3.02 Selection of Exchange Debentures to Be Redeemed.............20
Section 3.03 Notice of Redemption........................................20
Section 3.04 Effect of Notice of Redemption..............................21
Section 3.05 Deposit of Redemption or Purchase Price.....................21
Section 3.06 Exchange Debentures Redeemed or Purchased in Part...........22
Section 3.07 Optional Redemption.........................................22
Section 3.08 Mandatory Redemption........................................23
Section 3.09 Offer to Purchase by Application of Excess Proceeds.........23
</TABLE>
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<TABLE>
<CAPTION>
ARTICLE 4
COVENANTS
<S> <C> <C>
Section 4.01 Payment of Exchange Debentures...............................25
Section 4.02 Maintenance of Office or Agency..............................25
Section 4.03 Reports......................................................26
Section 4.04 Compliance Certificate.......................................26
Section 4.05 Taxes........................................................27
Section 4.06 Stay, Extension and Usury Laws...............................27
Section 4.07 Restricted Payments..........................................27
Section 4.08 Incurrence of Indebtedness and Issuance of Preferred Stock...29
Section 4.09 Transactions with Affiliates.................................31
Section 4.10 Continued Existence..........................................32
Section 4.11 Offer to Repurchase upon Change of Control...................32
Section 4.12 Payments for Consent.........................................33
Section 4.13 Asset Sales..................................................33
Section 4.14 Liens........................................................35
Section 4.15 Dividend and Other Payment Restrictions
Affecting Subsidiaries.......................................35
Section 4.16 No Senior Subordinated Debt..................................35
Section 4.17 Sale and Leaseback Transactions..............................36
Section 4.18 Limitation on Issuances and Sales of Capital Stock
of Wholly Owned Subsidiaries.................................36
Section 4.19 Business Activities..........................................36
ARTICLE 5
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets.....................37
Section 5.02 Successor Corporation Substituted............................37
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default............................................38
Section 6.02 Acceleration.................................................40
Section 6.03 Other Remedies...............................................40
Section 6.04 Waiver of Past Defaults......................................41
Section 6.05 Control by Majority..........................................41
Section 6.06 Limitation on Suits..........................................41
Section 6.07 Rights of Holders of Exchange Debentures to Receive Payment..42
Section 6.08 Collection Suit by Trustee...................................42
Section 6.09 Trustee May File Proofs of Claim.............................42
</TABLE>
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<TABLE>
<S> <C> <C>
Section 6.10 Priorities...................................................43
Section 6.11 Undertaking for Costs........................................43
ARTICLE 7
TRUSTEE
Section 7.01 Duties of Trustee............................................43
Section 7.02 Rights of Trustee............................................44
Section 7.03 Individual Rights of Trustee.................................45
Section 7.04 Trustee's Disclaimer.........................................45
Section 7.05 Notice of Defaults...........................................46
Section 7.06 Reports by Trustee to Holders of the Exchange Debentures.....46
Section 7.07 Compensation, Reimbursement and Indemnity....................46
Section 7.08 Replacement of Trustee.......................................47
Section 7.09 Successor Trustee by Merger, Etc.............................48
Section 7.10 Eligibility; Disqualification................................48
Section 7.11 Preferential Collection of Claims Against Company............48
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.....49
Section 8.02 Legal Defeasance and Discharge...............................49
Section 8.03 Covenant Defeasance..........................................49
Section 8.04 Conditions to Legal or Covenant Defeasance...................50
Section 8.05 Deposited Money and Government Securities to be Held
in Trust; Other Miscellaneous Provisions.....................51
Section 8.06 Repayment to the Company.....................................52
Section 8.07 Reinstatement................................................52
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Exchange Debentures............53
Section 9.02 With Consent of Holders of Exchange Debentures...............53
Section 9.03 Compliance with Trust Indenture Act..........................55
Section 9.04 Revocation and Effect of Consents............................55
Section 9.05 Notation on or Exchange of Exchange Debentures...............55
Section 9.06 Trustee to Sign Amendments, Etc..............................56
</TABLE>
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<TABLE>
<CAPTION>
ARTICLE 10
SUBORDINATION
<S> <C> <C>
Section 10.01 Agreement to Subordinate.....................................56
Section 10.02 Certain Definitions..........................................56
Section 10.03 Liquidation; Dissolution; Bankruptcy.........................57
Section 10.04 Default on Designated Senior Debt............................57
Section 10.05 Acceleration of Exchange Debentures..........................58
Section 10.06 When Distribution Must Be Paid Over..........................58
Section 10.07 Notice by Company............................................59
Section 10.08 Subrogation..................................................59
Section 10.09 Relative Rights..............................................59
Section 10.10 Subordination May Not Be Impaired by Company.................60
Section 10.11 Distribution or Notice to Representative.....................60
Section 10.12 Rights of Trustee and Paying Agent...........................60
Section 10.13 Authorization to Effect Subordination........................60
Section 10.14 Amendments...................................................61
ARTICLE 11
MISCELLANEOUS
Section 11.01 Trust Indenture Act Controls.................................61
Section 11.02 Notices......................................................61
Section 11.03 Communication by Holders of Exchange Debentures with
Other Holders of Exchange Debentures.........................62
Section 11.04 Certificate and Opinion as to Conditions Precedent...........62
Section 11.05 Statements Required in Certificate or Opinion................63
Section 11.06 Rules by Trustee and Agents..................................63
Section 11.07 No Personal Liability of Directors, Officers,
Employees and Stockholders...................................63
Section 11.08 Governing Law................................................64
Section 11.09 No Adverse Interpretation of Other Agreements................64
Section 11.10 Successors...................................................64
Section 11.11 Severability.................................................64
Section 11.12 Counterpart Originals........................................64
Section 11.13 Table of Contents, Headings, Etc.............................64
</TABLE>
EXHIBITS
Exhibit A -- Form of Exchange Debenture
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INDENTURE dated as of November 19, 1999 among AMFM Operating Inc., a
Delaware corporation (the "Company") and United States Trust Company of New
York, a New York banking corporation, as trustee (the "Trustee").
The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the 12 5/8% Senior
Subordinated Exchange Debentures due 2006 of the Company:
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.
"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.
"Advertising Business" means any business deriving substantially all of
its revenues from the (i) sale of advertisements and (ii) sale of products or
provision of services to any business described in clause (i) above.
"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 securities of a Person shall
be deemed to be control.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Asset Sale" means (i) the sale, lease, conveyance or other disposition
of any assets (including without limitation, by way of a sale and leaseback or
pursuant to an LMA or similar arrangement); provided that the sale, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company and its Subsidiaries taken as a whole will be governed by Section 4.11
hereof and/or Section 5.01 hereof and not by Section 4.13 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 aggregate net
proceeds in
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excess of $5.0 million. Notwithstanding the foregoing: (i) the Pending
Dispositions, the Chancellor Exchange and the CBS Exchange, in each case as
described in the Prospectus Supplement dated January 17, 1997, in all material
respects, (ii) a transfer of assets by the Company to a Wholly Owned Subsidiary
or by a Wholly Owned Subsidiary to the Company or to another Wholly Owned
Subsidiary, (iii) an issuance of Equity Interests by a Wholly Owned Subsidiary
to the Company or to another Wholly Owned Subsidiary, (iv) a Restricted Payment
that is permitted by Section 4.07 hereof and (v) sales of obsolete equipment in
the ordinary course of business.
"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).
"Bank Facilities" means, with respect to the Company, one or more debt
facilities (including, without limitation, the Credit Agreement) or commercial
paper facilities with banks or other institutional lenders providing for
revolving credit loans, term loans, receivables financing (including through the
sale of receivables to such lenders or to special purpose entities formed to
borrow from such lenders against such receivables ) or letters of credit, in
each case, as amended, restated, modified, renewed, refunded, replaced or
refinanced in whole or in part from time to time. Indebtedness under Bank
Facilities outstanding on the date on which the Series E Preferred Stock is
first issued under the Certificate of Designations relating to the Series E
Preferred Stock shall be deemed to have been incurred on such date in reliance
on the exception provided by clause (i) under Section 8(b) of such Certificate
of Designations.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Board" or "Board of Directors" means the Board of Directors of the
Company, the members of which are elected by the equity holders of the Company.
"Broadcast Business" means any business, the majority of whose revenues
are derived from the broadcast of radio programming.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not 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, partnership
interests
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(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 and time deposits with maturities of six months or less from the
date of acquisition, bankers' acceptances with maturities not exceeding six
months and overnight bank deposits, in each case with any lender party to the
Credit Agreement or with any domestic commercial bank having capital and surplus
in excess of $500.0 million and a Thomson 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.
"CBS Exchange" means the pending exchange by the Company of radio
station WHFS-FM, operating in Washington, D.C./Baltimore, Maryland, for KTXQ-FM
and KRRW-FM, both operating in Dallas, Texas, and owned by CBS, Inc.
"Chancellor Exchange" means the pending exchange of the Company's radio
stations WBAB-FM, WHFM-FM, WBLI-FM and WGBB-AM, each operating on Long Island,
New York, for WFYV-FM and WAPE-FM, both operating in Jacksonville, Florida, and
a payment to the Company of $11.0 million in cash.
"Change of Control" means the occurrence of any of the following: (i)
the sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its 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 his Related Parties, (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
exercisable immediately or only after the passage of time, upon the happening of
an event or otherwise), 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.
"Class A Common Stock" means the Class A Common Stock, par value $.01
per share, of the Company.
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"Closing Date" means the date on which the shares of Series E Preferred
Stock are first issued.
"Common Equity" means all shares now or hereafter authorized of any
class of common stock of the Company, including the Class A Common Stock, and
any other stock of the Company, howsoever designated, authorized after the
Closing Date, that have the right (subject always to prior rights of any class
or series of preferred stock) to participate in the distribution of the assets
and earnings of the Company without limit as to per share amount.
"Company" means AMFM Operating Inc., a Delaware corporation, until a
successor replaces it pursuant to this indenture and thereafter means such
successor and also includes for the purposes of any provision contained herein
and required by the TIA any other obligor on the Exchange Debentures.
"Consolidated Cash Flow" means, 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, less (v) 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.
"Consolidated Indebtedness" of any Person as of any date of
determination means the sum (without duplication) of (i) the total amount of
Indebtedness and Attributable Debt of such Person and its Subsidiaries, plus
(ii) the total amount of other Indebtedness shown on the balance sheet of the
primary obligor on such Indebtedness, to the extent that such Indebtedness has
been Guaranteed by such Person or one of its Subsidiaries, plus (iii) the
aggregate liquidation value or redemption amount (if larger) of all Disqualified
Stock of such Person and all preferred stock of Subsidiaries of such Person, in
each case, determined on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any Person for
any period, the sum of (i) the consolidated interest expense of such Person and
its Subsidiaries for such period, whether paid or accrued (including, without
limitation, amortization of original issue discount, non-cash interest payments,
the interest component of any deferred payment obligations, the interest
component of all payments associated with Capital Lease Obligations, imputed
interest with respect
4
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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) and (ii) the consolidated
interest expense of such Person and its Subsidiaries that was capitalized during
such period, and (iii) any interest expense on Indebtedness of another Person
that is guaranteed by such Person or one of its Subsidiaries or secured by a
Lien on assets of such Person or one of its Subsidiaries (whether or not such
Guarantee or Lien is called upon) and (iv) the product of (a) all cash dividend
payments (and non-cash dividend payments in the case of a Person that is a
Subsidiary) on any series of preferred stock of such Person, times (b) a
fraction, the numerator of which is one and the denominator of which is one
minus the then current combined federal, state and local statutory tax rate of
such Person, expressed as a decimal, in each case, on a consolidated basis and
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 Subsidiaries for
such period, determined on a consolidated basis in accordance with GAAP;
provided that (i) the Net Income (but not loss) of any Person that is not a
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 to a Wholly Owned Subsidiary thereof, (ii) the
Net Income of any Subsidiary shall be excluded to the extent that the
declaration or payment of dividends or similar distributions by that 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 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 and (iv) the cumulative effect of
a change in accounting principles shall be excluded.
"Consolidated Net Worth" means, with respect to any Person as of any
date, the sum of (i) the consolidated equity of the common stockholders of such
Person and its consolidated Subsidiaries as of such date plus (ii) the
respective amounts reported on such Person's balance sheet as of such date with
respect to any series of Preferred Stock (other than Disqualified Stock) that by
its terms is not entitled to the payment of dividends unless such dividends may
be declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such Preferred Stock, less (x) all write-ups (other than
write-ups resulting from foreign currency translations and write-ups of tangible
assets of a going concern business made within 12 months after the acquisition
of such business) subsequent to the date hereof in the book value of any asset
owned by such Person or a consolidated Subsidiary of such Person, (y) all
investments as of such date in unconsolidated Subsidiaries and in Persons that
are not Subsidiaries (except, in each case, Permitted Investments) and (z) all
unamortized debt discount and expense and unamortized deferred charges as of
such date, all of the foregoing determined in accordance with GAAP.
"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
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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 11.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Credit Agreement" means that certain credit agreement by and among the
Company, the Company's Subsidiaries, as guarantors, The Bank of New York, as
agent, and the lenders party thereto, providing for $225 million of revolving
credit borrowings, including any related notes, guarantees, collateral
documents, and other agreements executed in connection therewith, and in each
case as amended, modified, renewed, refunded, replaced or refinanced from time
to time.
"Debt to Cash Flow Ratio" means, as of any date of determination, the
ratio of (a) the Consolidated Indebtedness as of such date to (b) the
Consolidated Cash Flow of the Company and its Subsidiaries on a consolidated
basis for the four most recent full fiscal quarters ending immediately prior to
such date for which internal financial statements are available. For purposes of
calculating Consolidated Cash Flow for the computation referred to above, (i)
acquisitions that have been made by the Company or any of its 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 date on which such Ratio is being
calculated (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
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.
"Depositary" means, with respect to the Exchange Debentures 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 Exchange Debentures, until a
successor shall have been appointed and become such pursuant to the applicable
provision of this Indenture, and, thereafter, "Depositary" shall mean or include
such successor.
"Disqualified 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 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 Exchange Debentures mature.
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<PAGE> 14
"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).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Debenture Custodian" means the Trustee, as custodian with
respect to the Exchange Debentures in global form, or any successor entity
thereto.
"Exchange Debentures" means the Company's Senior 12 5/8% Subordinated
Exchange Debentures due 2006 issuable in exchange for the Company's Series E
Preferred Stock.
"Existing Indebtedness" means all Indebtedness of the Company and its
Subsidiaries (other than Indebtedness under the Credit Agreement) in existence
on the Closing Date, until such amounts are repaid.
"Existing MMR Indebtedness" means all Indebtedness of MMR and its
Subsidiaries in existence at the closing of the MMR Merger, until such amounts
are repaid.
"Fair Market Value" means, with respect to any asset or property, the
sale value that would be obtained in an arm's length transaction between an
informed and willing seller under no compulsion to sell and an informed and
willing buyer under no compulsion to buy.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date hereof.
"Global Exchange Debenture" means an Exchange Debenture that contains
the additional language referred to in footnote 1 to the form of the Exchange
Debenture attached hereto as Exhibit A.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which obligations
or guarantee the full faith and credit of the United States of America is
pledged.
"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, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"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
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<PAGE> 15
agreements and (ii) other agreements or arrangements designed to protect such
Person against fluctuations in interest rates.
"Holder" means a Person in whose name an Exchange Debenture is
registered.
"Indebtedness" means, with respect to any Person, without duplication,
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 payment obligations
under an LMA 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 (other than letters of credit and Hedging Obligations) would
appear as a liability upon a balance sheet of such Person prepared in accordance
with GAAP, as well as all indebtedness of others secured by a Lien on any asset
of such Person (whether or not such indebtedness is assumed by such Person) and,
to the extent not otherwise included, the Guarantee by such Person of any
indebtedness of any other Person.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the form 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;
provided that an acquisition of assets, Equity Interests or other securities by
the Company for consideration consisting of common equity securities of the
Company shall not be deemed to be an Investment. 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.
"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
for the intervening period.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
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<PAGE> 16
"Local Marketing Agreement" or "LMA" means a local marketing
arrangement, sale agreement, time brokerage agreement, management agreement or
similar arrangement pursuant to which a Person, subject to customary preemption
rights and other limitations (i) obtains the right to sell at least a majority
of the advertising inventory of a radio station of which a third party is the
licensee, (ii) obtains the right to broadcast programming and sell advertising
time during a majority of the air time of a radio station or (iii) manages the
selling operations of a radio station with respect to at least a majority of the
advertising inventory of such station.
"Management Termination Agreements" means each of (i) the termination
agreement between the Company and R. Steven Hicks, dated April 16, 1996, and
(ii) the amendment to the employment agreement between the Company and D.
Geoffrey Armstrong, effective as of April 15, 1996, in each case, as in effect
on the Closing Date.
"Material Broadcast License" means one or more authorizations issued by
the Federal Communications Commission for the operation of AM or FM radio
stations that individually or collectively are material to the financial
condition, results of operations or prospects of the Company and its
Subsidiaries taken as a whole.
"MMR" means Multi-Market Radio, Inc., a Delaware corporation.
"MMR Merger" means the merger of SFX Merger Company, a Wholly Owned
Subsidiary of the Company, with and into MMR, pursuant to which MMR became a
Wholly Owned Subsidiary of the Company.
"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 no
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 Subsidiaries or the
extinguishment of any Indebtedness of such person or any of its Subsidiaries and
(ii) any extraordinary or nonrecurring gain (but not loss), together with any
related provision for taxes on such extraordinary or nonrecurring gain (but not
loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its 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
(other than Senior Debt) 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.
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<PAGE> 17
"Obligations" means any principal, interest, penalties, fees
(including, but not limited to, reasonable fees of counsel), indemnifications,
reimbursements, damages and other liabilities payable under the documentation
governing any Indebtedness.
"Officer" means, (a) with respect to any Person that is a corporation,
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
and (b) with respect to any other Person, the individuals selected by the Board
of such Person to perform functions similar to those of the officers listed in
clause (a).
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the Chief Executive
Officer, President or Vice President and one of whom must be the Chief Financial
Officer, the Treasurer or the controller of the Company that meets the
requirements of Section 11.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
11.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Pari Passu Debt" means (i) the Senior Subordinated Notes and (ii) all
of the Indebtedness that ranks pari passu in right of payment with the Exchange
Debentures.
"Pending Dispositions" means, collectively, (i) the pending sale of
KOLL-FM, operating in Little Rock, Arkansas, and (ii) the pending sale of
WYAK-FM and WMYB-FM, both operating in Myrtle Beach, South Carolina.
"Permitted Investments" means (a) any Investment in the Company or in a
Subsidiary of the Company; (b) any Investment in Cash Equivalents; (c) any
Investment by the Company or any Subsidiary of the Company in a Person, if after
such Investment (i) such Person becomes a Subsidiary of the Company or (ii) 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 Subsidiary of the Company; (d) 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 4.13 hereof; (e) 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; (f) any Investment received involuntarily; (g)
Investments in any Person (other than an Affiliate of the Company that is not
also a Subsidiary of the Company) engaged in a Broadcast Business or an
Advertising Business which Investments have an aggregate Fair Market Value
(measured on the date each such Investment was made and without giving effect to
subsequent changes in value), when taken together with all other Investments
made pursuant to this clause (g) that are at the time outstanding, not to exceed
$20.0 million and (h) other Investments in any Person (other than an Affiliate
of the Company that is not also a Subsidiary of the Company) having an aggregate
Fair Market Value (measured on the date each such Investment was made and
without giving effect to subsequent changes in value), when taken together with
all other Investments made pursuant to this clause (h) that are at the time
outstanding, not to exceed $15.0 million.
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<PAGE> 18
"Permitted Liens" means (i) Liens securing Senior Debt of the Company
or securing Indebtedness of any Subsidiary that, in either case, was permitted
by the terms of this Indenture to be incurred; (ii) Liens in favor of the
Company; (iii) Liens on property of a Person existing at the time such Person is
merged into or consolidated with the Company or any Subsidiary of the Company;
provided that such Liens were in existence prior to the 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 Subsidiary of
the Company, provided that such Liens were in existence prior to the
contemplation of such acquisition and do not extend to any assets other than
such assets so acquired; (v) Liens existing on the Closing Date; (vi) Liens for
taxes, assessments or governmental charges or claims that are not yet delinquent
or that are being contested in good faith by appropriate proceedings promptly
instituted and diligently concluded, provided that any reserve or other
appropriate provision as shall be required in conformity with GAAP shall have
been made therefor; and (vii) Liens incurred in the ordinary course of business
of the Company or any Subsidiary of the Company with respect to obligations that
do not exceed $10.0 million at any one time outstanding and that (a) are not
incurred in connection with the borrowing of money or the obtaining of advances
or credit (other than trade credit in the ordinary course of business) and (b)
do not in the aggregate materially detract from the value of the property or
materially impair the use thereof in the operation of business by the Company or
such Subsidiary.
"Permitted Refinancing Debt" means any Indebtedness of the Company or
any of its Subsidiaries 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 Subsidiaries; provided that: (i) the principal
amount (or accreted value, if applicable) of such Permitted Refinancing
Indebtedness does not exceed the principal amount (or accreted value, if
applicable) of the Indebtedness so extended, refinanced, renewed, replaced,
defeased or refunded (plus the amount of reasonable expenses incurred in
connection therewith); (ii) such Permitted Refinancing Debt 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 subordinated in right of payment to the
Exchange Debentures, such Permitted Refinancing Debt has a final maturity date
later than the final maturity date of, and is subordinated in right of payment
to, the Exchange Debentures on terms at least as favorable to the Holders of
Exchange Debenture as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; and (iv) such Permitted Refinancing Debt is incurred either by the
Company or by the Subsidiary who was the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"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).
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<PAGE> 19
"Preferred Stock," of any Person, means Capital Stock of such Person of
any class or series (however designated) that ranks prior, as to payment of
dividends or as to the distribution of assets upon any voluntary or involuntary
liquidation, dissolution or winding up of such Person, to shares of Capital
Stock of any other class or series of such Person.
"Preferred Stock Offering" means the public offering of $225,000,000 in
aggregate liquidation preference of the Series E Preferred Stock.
"Principal" means Robert F.X. Sillerman.
"Related Party" with respect to the Principal means (A) any spouse or
immediate family member (in the case of an individual) of the Principal or (B)
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 (A).
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration department of the Trustee (or
any successor group of the Trustee) or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"SCMC" means Sillerman Communications Management Company, a Delaware
corporation.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Subordinated Note Indenture" means the indenture governing the
Company's 10 3/4% Senior Subordinated Notes due 2006.
"Senior Subordinated Notes" means the Company's 10 3/4% Senior
Subordinated Notes due 2006.
"Series D Exchange Notes" means the Company's 6 1/2% Subordinated
Convertible Exchange Notes due 2007 issuable in exchange for the Company's
Series D Preferred Stock.
"Series D Exchange Note Indenture" means the indenture governing the
Company's 6 1/2% Subordinated Convertible Exchange Notes due 2007 issuable in
exchange for the Company's Series D Preferred Stock.
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<PAGE> 20
"Series D Preferred Stock" means the Company's 6 1/2% Series D
Cumulative Convertible Exchangeable Preferred Stock due May 31, 2007.
"Series E Preferred Stock" means the Company's 12 5/8% Series E
Cumulative Exchangeable Preferred Stock due October 31, 2006.
"SFX Merger Company" means SFX Merger Company, a Delaware corporation.
"Shared Facilities Agreement" means the Shared Facilities Agreement
between the Company and SCMC, as in effect on the Closing Date.
"Significant Subsidiary" means any 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.
"Subsidiary" means, 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).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as amended as in effect on the date of this Indenture.
"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.
"Voting Stock" means with respect to any specified Person, Capital
Stock with voting power, under ordinary circumstances and without regard to the
occurrence of any contingency, to elect the directors or other managers or
trustees 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 Subsidiary" of any Person means a 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 Subsidiaries of such Person and one
or more Wholly Owned Subsidiaries of such Person.
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<PAGE> 21
Section 1.02 Other Definitions.
<TABLE>
<CAPTION>
Term Defined in Section
- ---- ------------------
<S> <C>
"Affiliate Transaction".................................... 4.09
"Asset Sale Offer"......................................... 4.13
"Change of Control Offer".................................. 4.11
"Change of Control Payment"................................ 4.11
"Change of Control Payment Date"........................... 4.11
"Covenant Defeasance"...................................... 8.03
"Custodian"................................................ 6.01
"Designated Senior Debt"................................... 10.02
"distribution"............................................. 10.02
"DTC"...................................................... 2.03
"Event of Default"......................................... 6.01
"Excess Proceeds".......................................... 4.13
"incur".................................................... 4.08
"Legal Defeasance"......................................... 8.02
"Notice of Default"........................................ 6.01
"Offer Amount"............................................. 3.09
"Offer Period"............................................. 3.09
"Outstanding".............................................. 8.02
"Paying Agent"............................................. 2.03
"Payment Blockage Notice".................................. 10.04
"Payment Default".......................................... 6.01
"Permitted Debt"........................................... 4.08
"Purchase Date"............................................ 3.09
"Registrar"................................................ 2.03
"Representative"........................................... 10.02
"Restricted Payments"...................................... 4.07
"Senior Bank Debt"......................................... 10.02
"Senior Debt".............................................. 10.02
</TABLE>
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 Exchange Debentures;
"indenture security Holder" means a Holder of an Exchange Debenture;
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<PAGE> 22
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
"obligor" on the Exchange Debentures means the Company and any
successor obligor upon the Exchange Debentures.
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
(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 EXCHANGE DEBENTURES
Section 2.01 Form and Dating.
The Exchange Debentures and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Exchange Debentures
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Each Exchange Debenture shall be dated the date of its authentication.
The Exchange Debentures shall be in all appropriate denominations.
The terms and provisions contained in the Exchange Debentures shall
constitute, and are hereby expressly made, a part of this Indenture and the
Company and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby.
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<PAGE> 23
Exchange Debentures issued in global form shall be substantially in the
form of Exhibit A attached hereto (including the text referred to in footnote 1
thereto). Exchange Debentures issued in certificated form shall be substantially
in the form of Exhibit A attached hereto (but without including the text
referred to in footnote 1 thereto). Each Global Exchange Debenture shall
represent such of the outstanding Exchange Debentures as shall be specified
therein and each shall provide that it shall represent the aggregate amount of
outstanding Exchange Debentures from time to time endorsed thereon and that the
aggregate amount of outstanding Exchange Debentures represented thereby may from
time to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Exchange Debenture to reflect the
amount of any increase or decrease in the amount of outstanding Exchange
Debentures represented thereby shall be made by the Trustee or the Exchange
Debenture Custodian, at the direction of the Trustee, in accordance with
instructions given by the Holder thereof.
Section 2.02 Execution and Authentication.
An Officer of the Company shall sign the Exchange Debentures for the
Company by manual or facsimile signature.
If an Officer whose signature is on an Exchange Debenture no longer
holds that office at the time an Exchange Debenture is authenticated, the
Exchange Debenture shall nevertheless be valid.
An Exchange Debenture shall not be valid until authenticated by the
manual signature of the Trustee. The signature shall be conclusive evidence that
the Exchange Debenture has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by two
Officers of the Company, authenticate Exchange Debentures for original issue up
to the aggregate principal amount stated in paragraph 4 of the Exchange
Debentures. The aggregate principal amount of Exchange Debentures outstanding at
any time may not exceed such amount.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate the Exchange Debentures. An authenticating agent may
authenticate Exchange Debentures 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
the Company or an Affiliate of the Company.
Section 2.03 Registrar and Paying Agent.
The Company shall maintain an office or agency where Exchange
Debentures may be presented for registration of transfer or for exchange
("Registrar") and an office or agency where Exchange Debentures may be presented
for payment ("Paying Agent"). The Registrar shall keep a register of the
Exchange Debentures 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
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<PAGE> 24
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company 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 Exchange Debentures.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Exchange Debenture Custodian with respect to the
Global Exchange Debentures.
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 interest on the Exchange Debentures, 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) shall have no further liability for the
money. If the Company 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 Exchange Debentures.
Section 2.05 Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA Section 312(a). If the Trustee
is not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Exchange Debentures and the Company shall otherwise comply with TIA Section
312(a).
Section 2.06 Replacement Exchange Debentures.
If any mutilated Exchange Debenture is surrendered to the Trustee or
either of the Company or the Trustee receives evidence to its satisfaction of
the destruction, loss or theft of any Exchange Debenture, the Company shall
issue and the Trustee, upon the written order of the Company signed by two
Officers of the Company, shall authenticate a replacement Exchange Debenture 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
an Exchange Debenture is replaced. The Company may charge for its expenses in
replacing an Exchange Debenture.
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<PAGE> 25
Every replacement Exchange Debenture 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 Exchange Debentures duly issued hereunder.
Section 2.07 Outstanding Exchange Debentures.
The Exchange Debentures outstanding at any time are all the Exchange
Debentures authenticated by the Trustee except for those canceled by it, those
delivered to it for cancellation, those reductions in the interest in a Global
Exchange Debenture effected by the Trustee in accordance with the provisions
hereof, and those described in this Section 2.07 as not outstanding. Except as
set forth in Section 2.08 hereof, an Exchange Debenture does not cease to be
outstanding because the Company or an Affiliate of the Company holds the
Exchange Debenture.
If an Exchange Debenture is replaced pursuant to Section 2.06 hereof,
it ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Exchange Debenture is held by a bona fide purchaser.
If the principal amount of any Exchange Debenture 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, by 10:00 a.m. Eastern Time on a redemption date
or maturity date, money sufficient to pay the Exchange Debentures payable on
that date, then on and after that date such Exchange Debentures shall be deemed
to be no longer outstanding and shall cease to accrue interest.
Section 2.08 Treasury Exchange Debentures.
In determining whether the Holders of the required principal amount of
Exchange Debentures have concurred in any direction, waiver or consent, Exchange
Debentures 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 Exchange Debentures that the Trustee
knows are so owned shall be so disregarded. The Company agrees to notify the
Trustee of the existence of any Exchange Debentures owned by the Company or any
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company.
Section 2.09 Temporary Exchange Debentures.
Until Certificated Exchange Debentures are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Exchange
Debentures upon a written order of the Company signed by two Officers of the
Company. Temporary Exchange Debentures shall be substantially in the form of
Certificated Exchange Debentures but may have variations that the Company
considers appropriate for temporary Exchange Debentures and as shall be
reasonably acceptable to the Trustee. Without unreasonable delay, the Company
shall prepare and the Trustee
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shall authenticate Certificated Exchange Debentures in exchange for temporary
Exchange Debentures.
Holders of temporary Exchange Debentures shall be entitled to all of
the benefits of this Indenture.
Section 2.10 Cancellation.
The Company at any time may deliver Exchange Debentures to the Trustee
for cancellation. The Registrar and Paying Agent shall forward to the Trustee
any Exchange Debentures surrendered to them for registration of transfer,
exchange or payment. The Trustee and no one else shall cancel all Exchange
Debentures surrendered for registration of transfer, exchange, payment,
replacement or cancellation and shall destroy canceled Exchange Debentures
(subject to the record retention requirement of the Exchange Act). Certification
of the destruction of all canceled Exchange Debentures shall be delivered to the
Company unless the Company directs the Trustee to return the Exchange Debentures
to the Company upon written order signed by an Officer of the Company. The
Company may not issue new Exchange Debentures to replace Exchange Debentures
that have been paid or that have been delivered to the Trustee for cancellation.
Section 2.11 Defaulted Interest.
If the Company defaults in a payment of interest on the Exchange
Debentures, 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 Exchange Debentures 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 Exchange Debenture 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.
Notwithstanding the foregoing, such interest may be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Exchange Debentures may be listed, and upon such notice as
may be required by such exchange.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.
If the Company redeems Exchange Debentures pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days (unless a shorter period may be satisfactory to the Trustee)
but not more than 60 days before a redemption date, an
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<PAGE> 27
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 Exchange Debentures to be redeemed and (iv) the redemption price.
If the Company is required to make an offer to purchase Exchange
Debentures pursuant to the provisions of Section 3.09 or 4.11 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 Exchange Debentures to be purchased, (iv)
the purchase price and (v) a statement to the effect that (a) the Company has
effected an Asset Sale and the conditions set forth in Sections 3.09 and 4.13
have been satisfied or (b) a Change of Control has occurred and the conditions
set forth in Section 4.11 have been satisfied, as applicable.
Section 3.02 Selection of Exchange Debentures to Be Redeemed.
If less than all of the Exchange Debentures are to be redeemed at any
time, the Trustee shall select the Exchange Debentures to be redeemed among the
Holders of the Exchange Debentures in compliance with the requirements of the
principal national securities exchange, if any, on which the Exchange Debentures
are listed or, if the Exchange Debentures are not so listed, on a pro rata
basis, by lot or in accordance with any other method the Trustee deems fair and
appropriate. In the event of partial redemption by lot, the particular Exchange
Debentures 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 Exchange Debentures not previously called for
redemption.
The Trustee shall promptly notify the Company in writing of the
Exchange Debentures selected for redemption and, in the case of any Exchange
Debenture selected for partial redemption, the principal amount thereof to be
redeemed. Exchange Debentures and portions of Exchange Debentures selected shall
be in amounts of $1000 or whole multiples of $1000; except that if all of the
Exchange Debentures of a Holder are to be redeemed, the entire outstanding
amount of Exchange Debentures held by such Holder, even if not a multiple of
$1000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Exchange Debentures called for
redemption also apply to portions of Exchange Debentures 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
Exchange Debentures are to be redeemed at its registered address.
The notice shall identify the Exchange Debentures to be redeemed and
shall state:
(a) the redemption date;
(b) the redemption price;
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<PAGE> 28
(c) if any Exchange Debenture is being redeemed in part, the
portion of the principal amount of such Exchange Debenture to be
redeemed and that, after the redemption date upon surrender of such
Exchange Debenture, a new Exchange Debenture or Exchange Debentures in
principal amount equal to the unredeemed portion shall be issued upon
cancellation of the original Exchange Debenture;
(d) the name and address of the Paying Agent;
(e) that Exchange Debentures 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 and interest on Exchange Debentures called for
redemption ceases to accrue on and after the redemption date;
(g) the paragraph of the Exchange Debentures and/or Section of
this Indenture pursuant to which the Exchange Debentures 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 Exchange Debentures.
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, Exchange Debentures 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 or Purchase Price.
On or prior to 10:00 a.m. Eastern Time on the redemption date or the
date upon which the Exchange Debentures must be accepted for purchase pursuant
to Section 3.09 or 4.11 hereof, the Company shall deposit with the Trustee or
with the Paying Agent money sufficient to pay the redemption or purchase price
of and accrued interest on all Exchange Debentures to be redeemed or purchased
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 or purchase price of,
and accrued interest, if any, on all Exchange Debentures to be redeemed or
purchased.
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<PAGE> 29
If Exchange Debentures called for redemption or tendered in an Asset
Sale Offer or a Change of Control Offer are paid or if the Company has deposited
with the Trustee or Paying Agent money sufficient to pay the redemption or
purchase price of, and unpaid and accrued interest on all Exchange Debentures to
be redeemed or purchased, on and after the applicable redemption or purchase
date, interest ceases to accrue on the Exchange Debentures or the portions of
Exchange Debentures called for redemption or tendered and not withdrawn in an
Asset Sale Offer or a Change of Control Offer (regardless of whether
certificates for such Exchange Debentures are actually surrendered). If an
Exchange Debenture is redeemed or purchased 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 Exchange
Debenture was registered at the close of business on such record date. If any
Exchange Debenture called for redemption or subject to an Asset Sale Offer or a
Change of Control Offer shall not be so paid upon surrender for redemption or
purchase because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal, from the redemption
or purchase 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 Exchange Debentures and in Section 4.01 hereof.
Section 3.06 Exchange Debentures Redeemed or Purchased in Part.
Upon surrender of an Exchange Debenture that is redeemed or purchased
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
Exchange Debenture equal in principal amount to the unredeemed or unpurchased
portion of the Exchange Debenture surrendered.
Section 3.07 Optional Redemption.
(a) Subject to Section 3.07(b) below, the Exchange Debentures
are not redeemable, in whole or in part, at the Company's option prior to
January 15, 2002. On or after January 15, 2002, the Company may redeem all or
any portion of the Exchange Debentures at a redemption price (expressed as a
percentage of the principal amount thereof), as set forth in the immediately
succeeding paragraph, plus accrued and unpaid interest to the redemption date.
The redemption price as a percentage of the principal amount shall be
as follows, if the Exchange Debentures are redeemed during the 12-month period
commencing on January 15 of the year set forth below, plus, in each case,
accrued interest thereon to the redemption date:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
---- ----------
<S> <C>
2002........................... 106.313%
2003...........................` 104.734%
2004........................... 103.156%
2005........................... 101.578%
2006 and thereafter............ 100.000%
</TABLE>
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<PAGE> 30
(b) In addition, prior to January 15, 2000, the Company may,
at its option, redeem up to 50% of the aggregate of (i) the liquidation
preference of the Series E Preferred Stock issued (whether initially issued or
issued in lieu of cash dividends) less the liquidation preference of Series E
Preferred Stock exchanged for Exchange Debentures and (ii) the principal amount
of Exchange Debentures issued (whether issued in exchange for Series E Preferred
Stock in lieu of cash interest), with the net proceeds of one or more Common
Equity offerings received on or after the date of original issuance of the
Series E Preferred Stock at a redemption price of 112.625% of the liquidation
preference or principal amount, as the case may be, plus accumulated and unpaid
dividends in the case of Series E Preferred Stock and accrued and unpaid
interest in the case of Exchange Debentures; provided, that after any such
redemption, if any Series E Preferred Stock or Exchange Debentures remain
outstanding, at least $50 million in liquidation preference or principal amount,
as applicable, of the Series E Preferred Stock or Exchange Debentures, as the
case may be, remain outstanding; and provided further, that any such redemption
shall occur within 75 days of the date of closing of such offering of Common
Equity of the Company.
Section 3.08 Mandatory Redemption.
The Company shall not be required to make mandatory redemption payments
with respect to the Exchange Debentures.
Section 3.09 Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.13 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, 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 Exchange Debentures required to
be purchased pursuant to Section 4.13 hereof (the "Offer Amount") or, if less
than the Offer Amount has been tendered, all Exchange Debentures tendered in
response to the Asset Sale Offer. Payment for any Exchange Debentures 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 an Exchange Debenture is registered at the
close of business on such record date, and no additional interest shall be
payable to Holders who tender Exchange Debentures 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 Exchange Debentures pursuant to the Asset Sale Offer. The Asset Sale
Offer shall be made to all Holders. The notice, which shall govern the terms of
the Asset Sale Offer, shall state:
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<PAGE> 31
(a) that the Asset Sale Offer is being made pursuant to
Sections 3.09 and 4.13 hereof and the length of the Offer Period;
(b) the Offer Amount, the purchase price and the Purchase
Date;
(c) that any Exchange Debenture not tendered or accepted for
payment shall continue to accrue interest;
(d) that, unless the Company defaults in making such payment,
any Exchange Debenture accepted for payment pursuant to the Asset Sale
Offer shall cease to accrue interest, if any after the Purchase Date;
(e) that Holders electing to have an Exchange Debenture
purchased pursuant to an Asset Sale Offer may only elect to have all of
such Exchange Debenture purchased and may not elect to have only a
portion of such Exchange Debenture purchased;
(f) that Holders electing to have an Exchange Debenture
purchased pursuant to any Asset Sale Offer shall be required to
surrender the Exchange Debenture, with the form entitled "Option of
Holder to Elect Purchase" on the reverse of the Exchange Debenture
completed, or transfer by book-entry transfer, to the Company, a
depositary, if appointed by the Company, or a Paying Agent at the
address specified in the notice at least three days before the Purchase
Date;
(g) that Holders shall be entitled to withdraw their election
if the Company, the Depositary or the Paying Agent, as the case may be,
receives, not later than the expiration of the Offer Period, a
telegram, facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Exchange Debenture the Holder
delivered for purchase and a statement that such Holder is withdrawing
his election to have such Exchange Debenture purchased;
(h) that, if the aggregate principal amount of Exchange
Debentures and Pari Passu Debt surrendered by Holders exceeds the Offer
Amount, the Company shall select the Exchange Debentures to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Exchange Debentures in
denominations of $1,000, or integral multiples thereof, shall be
purchased); and
(i) that Holders whose Exchange Debentures were purchased only
in part shall be issued new Exchange Debentures equal in principal
amount to the unpurchased portion of the Exchange Debentures
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 Exchange Debentures or portions thereof tendered pursuant to the
Asset Sale Offer, or if less than the Offer Amount has been tendered, all
Exchange Debentures tendered, and shall deliver to the Trustee an Officers'
Certificate stating that such Exchange Debentures or portions thereof were
accepted for payment by the Company in
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<PAGE> 32
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 Exchange Debentures tendered by
such Holder and accepted by the Company for purchase, and the Company shall
promptly issue a new Exchange Debenture, and the Trustee, upon written request
from the Company shall authenticate and mail or deliver such new Exchange
Debenture to such Holder, in a principal amount equal to any unpurchased portion
of the Exchange Debenture surrendered. Any Exchange Debenture 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. The Company shall 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 Exchange Debentures in an Asset Sale Offer.
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 Exchange Debentures.
The Company shall pay or cause to be paid the principal of, premium, if
any, and interest on the Exchange Debentures on the dates and in the manner
provided in the Exchange Debentures. Principal, premium, if any, and interest
shall be considered paid on the date due if the Paying Agent, if other than the
Company, 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 then due.
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Exchange
Debentures to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest (without regard to any applicable grace period) at the same rate to the
extent lawful.
Section 4.02 Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Exchange Debentures may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Exchange Debentures 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
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<PAGE> 33
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 Exchange Debentures 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
hereof. The Trustee may resign such agency at any time by giving written notice
to the Company no later than 30 days prior to the effective date of such
resignation.
Section 4.03 Reports.
Whether or not required by the rules and regulations of the SEC, so
long as any Exchange Debentures are outstanding, the Company shall furnish to
the Trustee and to the Holders of Exchange Debentures (a) all quarterly and
annual financial information that would be required to be contained in a filing
with the SEC on Forms 10-Q and 10-K if the Company were required to file such
Forms, including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and, with respect to the annual information only, a
report thereon by the Company's certified independent accountants and (b) all
current reports that would be required to be filed with the SEC on Form 8-K if
the Company were required to file such reports. In addition, 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 (unless
the SEC will not accept such a filing) and make such information available to
securities analysts and prospective investors upon request.
Section 4.04 Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 90 days
after the end of each fiscal year (which fiscal year, as of the date hereof,
ends on December 31), 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
their 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 are 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
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<PAGE> 34
on account of the principal of or interest on the Exchange Debentures 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 4.3 above shall be
accompanied by a written statement of the Company's independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Article Four or Article Five hereof or,
if any such violation has occurred, specifying the nature and period of
existence thereof, it being understood that such accountants shall not be liable
directly or indirectly to any Person for any failure to obtain knowledge of any
such violation.
(c) The Company shall, so long as any of the Exchange
Debentures are outstanding, deliver to the Trustee, forthwith upon any Officer
of the Company 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 Exchange Debentures.
Section 4.06 Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
Section 4.07 Restricted Payments.
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly: (a) declare or pay any dividend or make any other
payment or distribution on account of the Company's Equity Interests (including,
without limitation, any payment in connection with any merger or consolidation
involving the Company) or to the direct or indirect holders of the Company's
Equity Interests in their capacity as such (other than dividends or
distributions payable in Capital Stock (other than Disqualified Stock) of the
Company); (b) purchase, redeem or otherwise
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<PAGE> 35
acquire or retire for value any Equity Interests of the Company or any direct or
indirect parent of the Company; (c) make any principal payment on, or purchase,
redeem, defease or otherwise acquire or retire for value any Indebtedness that
is subordinated to the Exchange Debentures, except at final maturity; or (d)
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
(other than Permitted Debt) pursuant to the Debt to Cash Flow Ratio
test set forth in the first paragraph of Section 4.08 hereof; and
(c) such Restricted Payment, together with the aggregate
amount of all other Restricted Payments declared or made after the
Closing Date (other than Restricted Payments permitted by clauses (2),
(5), (7), (8), (10) or (12) of the following paragraph) shall not
exceed, at the date of determination, the sum of (1) an amount equal to
the Company's Consolidated Cash Flow from the Closing Date to the end
of the Company'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 Company's
Consolidated Interest Expense from the Closing Date to the end of the
Company'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 Company from the issue or sale after the Closing Date of Equity
Interests of the Company (other than (i) sales of Disqualified Stock
and (ii) Equity Interests sold to any of the Company's Subsidiaries) or
of debt securities or Disqualified Stock (other than the Series D
Preferred Stock) of the Company issued after the Closing Date that have
been converted into such Equity Interests plus (3) to the extent that
any Restricted Investment that was made after the Closing 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 Default or Event of Default 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
Indenture; (2) the redemption, repurchase, retirement or other acquisition of
any Equity Interests of the Company in exchange for, or out of the 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 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
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<PAGE> 36
payment of dividends on the Series D Preferred Stock in accordance with the
terms thereof as in effect on the Closing 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 4.08 hereof; (6) in the event that the Company
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; (7) the payment of dividends on the Series E
Preferred Stock in accordance with the terms thereof as in effect on the Closing
Date; (8) the issuance of additional Exchange Debentures in exchange for the
Series E Preferred Stock; provided that such issuance is permitted by Section
4.08 hereof; (9) in the event that the Company 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; (10) the defeasance,
redemption or repurchase of subordinated Indebtedness with the net cash proceeds
from an incurrence of Permitted Refinancing Debt or the substantially concurrent
sale (other than to a Subsidiary of the Company) of Equity Interests of the
Company (other than 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; (11) payments made by the Company 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 Closing Date; (12) payments by the Company pursuant to the
Management Termination Agreements in accordance with the terms thereof as in
effect on the Closing Date; (13) the redemption by the Company of its Series C
Preferred Stock in accordance with the terms thereof as in effect on the Closing
Date; and (14) the redemption by the Company of its Series B Preferred Stock in
accordance with the terms thereof as in effect on the Closing Date; provided
that payments made by the Company 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 Closing Date.
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 Trustee on the date of the
Restricted Payment of the asset(s) or securities proposed to be transferred by
the Company or such Subsidiary, as the case may be, pursuant to the Restricted
Payment. 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 covenant were computed, which calculations may be
based upon the Company's latest available financial statements.
Section 4.08 Incurrence of Indebtedness and Issuance of Preferred Stock.
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable, contingently or otherwise, with respect to
(collectively, "incur") any Indebtedness (including Acquired Debt) and
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that the Company will not issue any Disqualified Stock and will not permit any
of its Subsidiaries to issue any shares of Preferred Stock; provided, however,
that (a) the Company may incur Indebtedness (including Acquired Debt) or issue
shares of Disqualified Stock and (b) (A)the Subsidiaries may Guarantee Senior
Debt and (B) the Subsidiaries may issue Preferred Stock (other than Disqualified
Stock) if, in either 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
the Guarantee of such Senior Debt or the issuance of such Preferred Stock, as
the case may be, after giving pro forma effect to such incurrence or issuance or
Guarantee as of such date and to the use of 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 7.0 to 1.
The foregoing provisions will not apply to the incurrence of any of the
following Indebtedness (collectively, "Permitted Debt"):
(i) the incurrence by the Company and its Subsidiaries of
Indebtedness pursuant to one or more Bank Facilities, so long as the
aggregate principal amount of all Indebtedness outstanding under all
Bank Facilities does not, at the time of incurrence, exceed an amount
equal to $225.0 million;
(ii) the incurrence by the Company and its Subsidiaries of the
Existing Indebtedness;
(iii) Indebtedness under the Exchange Debentures;
(iv) the issuance of Disqualified Stock by the Company that by
its terms would not require or permit any payment of dividends or other
distributions that would violate Section 4.07 hereof;
(v) the incurrence by the Company or any of its Subsidiaries
of Indebtedness in connection with the acquisition of assets or a new
Subsidiary; provided that such Indebtedness was incurred by the prior
owner of such assets or such Subsidiary prior to such acquisition by
the Company or one of its Subsidiaries and was not incurred in
connection with, or in contemplation of, such acquisition by the
Company or one of its Subsidiaries; and provided further that, after
giving pro forma effect to such incurrence of Indebtedness as of such
date and to the use of proceeds therefrom as if the same had occurred
at the beginning of the most recently ended four full fiscal quarter
period for which internal financial statements are available, the
Company's Debt to Cash Flow Ratio would have been no greater than 7.0
to 1;
(vi) the incurrence by the Company or any of its Subsidiaries
of Permitted Refinancing Debt in exchange for, or the net proceeds of
which are used to extend, refinance, renew, replace, defease or refund,
Indebtedness that was permitted by the terms of this Indenture to be
incurred;
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(vii) the incurrence by the Company or any of its Subsidiaries
of intercompany Indebtedness between or among the Company and any of
its Subsidiaries; provided, however, that (i) if the Company is the
obligor on such Indebtedness, such Indebtedness is expressly
subordinate to the payment in full of all Obligations with respect to
the Exchange Debentures and (ii) (A) any subsequent issuance or
transfer of Equity Interests that results in any such Indebtedness
being held by a Person other than the Company or a Subsidiary and (B)
any sale or other transfer of any such Indebtedness to a Person that is
not either the Company or a Subsidiary shall be deemed, in each case,
to constitute an incurrence of such Indebtedness by the Company or such
Subsidiary, as the case may be;
(viii) the incurrence by the Company or any of its
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; and
(ix) the incurrence by the Company and any of its Subsidiaries
of Indebtedness (in addition to Indebtedness permitted by any other
clause of this paragraph) in an aggregate principal amount (or accreted
value, as applicable) at any time outstanding not to exceed $10.0
million.
Section 4.09 Transactions with Affiliates.
The Company 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 (a) such Affiliate Transaction is on terms that
are no less favorable to the Company or the relevant Subsidiary than those that
would have been obtained in a comparable transaction by the Company or such
Subsidiary with an unrelated Person and (b) the Company delivers to the Trustee
(a) with respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $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 Exchange
Debentures 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 Company 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 Assignment Agreement between the Company and SCMC as in effect
on the Closing Date, (4) payments required by the terms of the joint lease among
the Company, SCMC and the landlord thereunder for the Company's corporate
headquarters located at 150 East 58th Street, New York, New York and any
agreements directly related thereto, in each case, as the same are in effect on
the Closing Date, (5) payments made by the Company to SCMC for facilities
maintenance
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and other services and reimbursements pursuant to the Shared Facilities
Agreements, (6) payments and other transactions by the Company pursuant to the
Management Termination Agreements and (7) any Restricted Payments that are
permitted by Section 4.07 hereof and any Permitted Investments, in each case,
shall not be deemed to be Affiliate Transactions.
Section 4.10 Continued Existence.
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 (a) its
corporate, partnership, limited liability company or other existence, and the
corporate, partnership, limited liability company 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 (b) the rights (charter and statutory), licenses and franchises of the
Company and any of their respective 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 their Subsidiaries,
if the respective Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
its respective Subsidiaries, taken as a whole, and that the loss thereof is not
adverse in any material respect to the Holders of the Exchange Debentures.
Section 4.11 Offer to Repurchase upon Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder of
Exchange Debentures shall have the right to require the Company to repurchase
all or any part of such Holder's Exchange Debentures pursuant to the offer
described below (the "Change of Control Offer") at an offer price in cash equal
to 101% of the principal amount thereof plus, accrued and unpaid interest, if
any, thereon to the date of purchase (the "Change of Control Payment").
(b) Within 10 days following any Change of Control, the
Company shall mail a notice to each Holder, with a copy to the Trustee, stating:
(1) that the Change of Control Offer is being made pursuant to this Section 4.11
and that all Exchange Debentures tendered shall be accepted for payment; (2) the
purchase price and the purchase date, which shall be no later than 30 Business
Days from the date such notice is mailed (the "Change of Control Payment Date");
(3) that any Exchange Debenture not tendered shall continue to accrue interest;
(4) that, unless the Company defaults in the payment of the Change of Control
Payment, all Exchange Debentures accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest, after the Change of Control
Payment Date; (5) that Holders electing to have any Exchange Debentures
purchased pursuant to a Change of Control Offer shall be required to surrender
the Exchange Debentures, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Exchange Debentures completed, to the Paying
Agent at the address specified in the notice prior to the close of business on
the third Business Day preceding the Change of Control Payment Date; and (6)
that Holders whose Exchange Debentures are being purchased only in part shall be
issued new Exchange Debentures equal in principal amount to the unpurchased
portion of the Exchange Debentures surrendered, which unpurchased portion must
be equal to $1,000 in principal amount or an integral multiple thereof. The
Company shall comply with the requirements of Rule 14e-1 under the
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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 Exchange Debentures in connection with a Change of Control.
(c) On or prior to 10:00 a.m. Eastern Time on the Change of
Control Payment Date, the Company shall, to the extent lawful, (1) accept for
payment all Exchange Debentures or portions thereof properly tendered pursuant
to the Change of Control Offer, (2) deposit with the Paying Agent an amount
equal to the Change of Control Payment in respect of all Exchange Debentures or
portions thereof so tendered and (3) deliver or cause to be delivered to the
Trustee the Exchange Debentures so accepted together with an Officers'
Certificate stating the aggregate principal amount of Exchange Debentures or
portions thereof being purchased by the Company. The Paying Agent shall promptly
mail to each Holder of Exchange Debentures so tendered the Change of Control
Payment for such Exchange Debentures, and the Trustee shall promptly
authenticate and mail (or cause to be transferred by book entry) to each Holder
a new Exchange Debenture equal in principal amount to any unpurchased portion of
the Exchange Debentures surrendered, if any. Prior to complying with the
provisions of this Section 4.11, but in any event within 90 days following a
Change of Control, the Company shall either repay all outstanding Senior Debt or
obtain the requisite consents, if any, under all agreements governing
outstanding Senior Debt, in each case to the extent required to permit the
repurchase of Exchange Debentures required by this Section 4.11. The Company
shall publicly announce the results of the Change of Control Offer on or as soon
as practicable after the Change of Control Payment Date.
(d) The Company shall not be required to make a Change of
Control Offer upon a Change of Control if a third party makes the Change of
Control Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Indenture applicable to a Change of Control Offer
made by the Company, and purchases all Exchange Debentures validly tendered and
not withdrawn under such Change of Control Offer.
Section 4.12 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 Exchange Debentures for or as
an inducement to any consent, waiver or amendment of any of the terms or
provisions of this Indenture or the Exchange Debentures unless such
consideration is offered to be paid or is paid to all Holders of the Exchange
Debentures 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 4.13 Asset Sales.
The Company shall not, and shall not permit any of its Subsidiaries to,
engage in any Asset Sale unless (a) the Company (or the 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 (b) at least 75% of
the consideration
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therefor received by the Company or such Subsidiary is in the form of cash;
provided that the amount of (x) any liabilities (as shown on the Company's or
such Subsidiary's most recent balance sheet), of the Company or any Subsidiary
(other than contingent liabilities and liabilities that are by their terms
subordinated to the Exchange Debentures 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 Subsidiary from further liability
and (y) any notes or other obligations received by the Company or any such
Subsidiary from such transferee that are immediately converted by the Company or
such Subsidiary into cash (to the extent of the cash received), shall be deemed
to be cash for purposes of this provision.
Within 360 days after the receipt of any Net Proceeds from an Asset
Sale, the Company may apply such Net Proceeds, at its option, (a) to permanently
reduce Senior Debt (and to correspondingly reduce commitments with respect
thereto, in the case of Senior Debt that is revolving debt), or (b) to the
acquisition of a controlling interest in another business, the making of a
capital expenditure or the acquisition of other long-term assets, in each case,
in the Broadcast Business or businesses reasonably related thereto. 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 will be
deemed to constitute "Excess Proceeds." Within fifteen Business Days of each
date on which the aggregate amount of Excess Proceeds exceeds $10.0 million, the
Company will be required to make an offer to all Holders of Exchange Debentures,
in accordance with the procedures set forth in Section 3.09 hereof, and the
holders of Pari Passu Debt, to the extent required by the terms thereof (an
"Asset Sale Offer"), to purchase the maximum principal amount of Exchange
Debentures and any such Pari Passu Debt 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 thereon to the date of purchase,
in accordance with the procedures set forth in this Indenture or the agreements
governing Pari Passu Debt, as applicable; provided, however, that the Company
may only purchase Pari Passu Debt in an Asset Sale Offer that was issued
pursuant to an indenture having a provision substantially similar to the Asset
Sale Offer provision contained in this Indenture. To the extent that the
aggregate amount of Exchange Debentures and Pari Passu Debt tendered pursuant to
an Asset Sale Offer is less than the Excess Proceeds, the Company may use any
remaining Excess Proceeds for general corporate purposes. If the aggregate
principal amount of Exchange Debentures and Pari Passu Debt surrendered exceeds
the amount of Excess Proceeds, the Trustee shall select the Exchange Debentures
and Pari Passu Debt to be purchased on a pro rata basis, based upon the
principal amount thereof surrendered in such Asset Sale Offer. Upon completion
of such offer to purchase, the amount of Excess Proceeds shall be reset at zero.
Notwithstanding the immediately preceding paragraph, the Company and
its Subsidiaries will be permitted to consummate an Asset Sale without complying
with such paragraph if (i) the Company or the applicable 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
dispose 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 assets or other
property of a kind usable by the Company and its Subsidiaries
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in the business of the Company and its Subsidiaries as conducted by the Company
and its Subsidiaries on the date of this Indenture; provided that any
consideration not constituting assets or property of a kind usable by the
Company and its Subsidiaries in the business conducted by them on the date of
such Asset Sale received by the Company or any of its Subsidiaries in connection
with any Asset Sale permitted to be consummated under this paragraph shall
constitute Net Proceeds subject to the provisions of the two succeeding
paragraphs.
Section 4.14 Liens.
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or suffer to exist any Lien
securing Indebtedness (other than Senior Debt) on any asset now owned or
hereafter acquired, or on any income or profits therefrom, except Permitted
Liens.
Section 4.15 Dividend and Other Payment Restrictions Affecting
Subsidiaries.
The Company shall not, and shall not permit any of its 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 Subsidiary to
(i)(x) pay dividends or make any other distributions to the Company or any of
its Subsidiaries (1) on its Capital Stock or (2) with respect to any other
interest or participation in, or measured by, its profits, or (y) pay any
indebtedness owed to the Company or any of its Subsidiaries, (ii) make loans or
advances to the Company or any of its Subsidiaries or (iii) transfer any of its
properties or assets to the Company or any of its Subsidiaries, except for such
encumbrances or restrictions existing under or by reason of (a) Existing
Indebtedness as in effect on the Closing Date, (b) the Credit Agreement as in
effect as of the Closing Date, 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 all such amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacement or refinancings and other agreements are no
more restrictive with respect to such dividend and other payment restrictions
than those contained in the Credit Agreement as in effect on the Closing Date,
(c) the Senior Subordinated Note Indenture, the Senior Subordinated Notes and
the subsidiary guarantees thereof, in each case, as in effect on the Closing
Date, (d) this Indenture and the Exchange Debentures, (e) applicable law, (f)
any instrument governing Indebtedness or Capital Stock of a Person acquired by
the Company or any of its Subsidiaries as in effect at the time of such
acquisition (except to the extent such Indebtedness was incurred in connection
with or in contemplation of such acquisition), which encumbrance or restriction
is not applicable to any Person, or the properties or assets of any Person,
other than the Person, or the property or assets of the Person, so acquired,
provided that, in the case of Indebtedness, such Indebtedness was permitted by
the terms of this Indenture to be incurred, (g) by reason of customary
non-assignment provisions in leases entered into in the ordinary course of
business and consistent with past practices, or (h) Permitted Refinancing Debt,
provided that the restrictions contained in the agreements governing such
Permitted Refinancing Debt are no more restrictive than those contained in the
agreements governing the Indebtedness being refinanced.
Section 4.16 No Senior Subordinated Debt.
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The Company shall not incur, create, issue, assume, Guarantee or
otherwise become liable for 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 Exchange Debentures.
Section 4.17 Sale and Leaseback Transactions.
The Company shall not, and shall not permit any of its Subsidiaries to,
enter into any sale and leaseback transaction; provided that the Company may
enter into a sale and leaseback transaction if (i) the Company could have (a)
incurred Indebtedness (other than Permitted Debt) 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
4.08 hereof and (b) incurred a Lien to secure such Indebtedness pursuant to
Section 4.14 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 Company applies the proceeds of
such transaction in compliance with Section 4.13 hereof.
Section 4.18 Limitation on Issuances and Sales of Capital Stock of Wholly
Owned Subsidiaries.
The Company (i) shall not, and will not permit any Wholly Owned
Subsidiary of the Company to, transfer, convey, sell, lease or otherwise dispose
of any Capital Stock of any Wholly Owned Subsidiary of the Company to any Person
(other than the Company or a Wholly Owned Subsidiary of the Company), unless (a)
such transfer, conveyance, sale, lease or other disposition is of all the
Capital Stock of such Wholly Owned Subsidiary and (b) the cash Net Proceeds from
such transfer, conveyance, sale, lease or other disposition are applied in
accordance with Section 4.13 hereof and (ii) will not permit any Wholly Owned
Subsidiary of the Company to issue any of its Equity Interests (other than, if
necessary, shares of its Capital Stock constituting directors' qualifying
shares) to any Person other than to the Company or a Wholly Owned Subsidiary of
the Company; provided that the Subsidiaries of the Company may issue Preferred
Stock (other than Disqualified Stock) in accordance with Section 4.08 hereof.
Section 4.19 Business Activities.
The Company shall not, and shall not permit any Subsidiary to, engage
in any business other than (i) the Broadcast Business and such business
activities as are incidental or related thereto and (ii) such other businesses
as the Company or its Subsidiaries are engaged in on the Closing Date.
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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 entity 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
Exchange Debentures and this Indenture 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; (iv) such transaction will
not result in the loss or suspension or material impairment of any Material
Broadcast License; and (v) except in the case of a merger of the Company with or
into a Wholly Owned 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 (A) shall have a Consolidated Net Worth
immediately after the transaction equal to or greater than the Consolidated Net
Worth of the Company immediately preceding the transaction; and (B) will, at the
time of such transaction and after giving pro forma effect thereto as if such
transaction had occurred at the beginning of the applicable four-quarter period,
be permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Debt to Cash Flow Ratio test set forth in the first paragraph of the covenant
described under Section 4.08 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 and , if any, on the Exchange Debentures except in the
case of a sale of all of the Company's assets that meets the requirements of
Section 5.01 hereof.
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ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.
Each of the following constitutes an "Event of Default":
(a) a default for 30 days in the payment when due of interest
on, the Exchange Debentures (whether or not prohibited by Article 10
hereof);
(b) a default in payment when due of the principal of or
premium, if any, on the Exchange Debentures (whether or not prohibited
by Article 10 hereof);
(c) the failure by the Company to comply with the provisions
described under Sections 3.9, 4.7, 4.8, 4.11, 4.13 and 5.1 hereof;
(d) the failure by the Company for 60 days after notice to
comply with any of its other agreements in this Indenture or the
Exchange Debentures;
(e) a default 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 Subsidiaries (or the payment of which is guaranteed by the Company
or any of its 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 $25.0 million or
more;
(f) the failure by the Company or any of its Subsidiaries 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;
(g) the Company, any Significant Subsidiary of the Company or
any group of Subsidiaries that, taken together, would constitute a
Significant Subsidiary pursuant to or within the meaning of Bankruptcy
Law:
(a) commences a voluntary case,
(b) consents to the entry of an order for relief
against it in an involuntary case,
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<PAGE> 46
(c) consents to the appointment of a Custodian of it
or for all or substantially all of its property,
(d) makes a general assignment for the benefit of its
creditors, or
(e) generally is not paying its debts as they become
due; or
(h) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(a) is for relief against the Company, any of its
Significant Subsidiaries or any group of its Subsidiaries
that, taken together, would constitute a Significant
Subsidiary in an involuntary case;
(b) appoints a Custodian of the Company, any of its
Significant Subsidiaries, or any group of its Subsidiaries
that, taken together, would constitute a Significant
Subsidiary or for all or substantially all of the property of
the Company, any of its Significant Subsidiaries or any group
of its Subsidiaries that, taken together, would constitute a
Significant Subsidiary; or
(c) orders the liquidation of the Company, any of its
Significant Subsidiaries or any group of its Subsidiaries
that, taken together, would constitute a Significant
Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive days.
The term "Custodian" means any receiver, trustee, assignee, liquidator
or similar official under any Bankruptcy Law.
An Event of Default shall not be deemed to have occurred under clause
(iv) of this Section 6.01 until the Trustee notifies the Company, or the Holders
of at least 25% in principal amount of the then outstanding Exchange Debentures
notify the Company and the Trustee, of the Default and the Company does not cure
the Default within 60 days after receipt of the notice. The notice must specify
the Default, demand that it be remedied and state that the notice is a "Notice
of Default."
In the case of any Event of Default pursuant to the provisions of this
Section 6.01 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 Exchange Debentures pursuant to Section 3.07 hereof, an
equivalent premium shall also become and be immediately due and payable to the
extent permitted by law upon the acceleration of the Exchange Debentures,
anything in this Indenture or in the Exchange Debentures to the contrary
notwithstanding. If an Event of Default occurs prior to January 15, 2002 by
reason of any action (or inaction) willfully taken (or not taken) by or on
behalf of the Company with the intention of avoiding the prohibition on
redemption of the Exchange Debentures prior to January 15, 2002, then the
premium payable for purposes of this paragraph for
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<PAGE> 47
each of the years beginning on January 15 of the years set forth below shall be
as set forth in the following table expressed as a percentage of the amount that
would otherwise be due but for the provisions of this sentence, plus accrued
interest, to the date of payment:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
---- ----------
<S> <C>
1997........................ 114.202%
1998........................ 112.624%
1999........................ 111.046%
2000........................ 109.468%
2001 ....................... 107.890%
</TABLE>
Section 6.02 Acceleration.
If any Event of Default (other than an Event of Default specified in
clauses (vii) or (viii) of Section 6.01 hereof) occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Exchange Debentures may declare all the Exchange Debentures to be
due and payable immediately. Upon any such declaration, the Exchange Debentures
shall become due and payable immediately. Notwithstanding the foregoing, if an
Event of Default specified in clauses (vii) or (viii) of Section 6.01 hereof
occurs with respect to the Company, any of its Significant Subsidiaries or any
group of its Subsidiaries that, taken together, would constitute a Significant
Subsidiary, such an amount shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holder. The Holders of a majority in principal amount of the then outstanding
Exchange Debentures by written notice to the Trustee may rescind an acceleration
and its consequences if the rescission would not conflict with any judgment or
decree and if all existing Events of Default (except nonpayment of principal or
interest that has become due solely because of the acceleration) have been cured
or waived.
In addition, the Company shall promptly notify holders of Senior Debt
if payment of the Exchange Debentures is accelerated because of an 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 and interest
on the Exchange Debentures or to enforce the performance of any provision of the
Exchange Debentures or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Exchange Debentures or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder of an Exchange Debenture 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.
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Section 6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Exchange Debentures may by notice to the Trustee on behalf
of the Holders of all of the Exchange Debentures 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 or interest on, the
Exchange Debentures (including in connection with an offer to purchase)
(provided, however, that the Holders of a majority in aggregate principal amount
of the then outstanding Exchange Debentures may rescind an acceleration and its
consequences, including any related payment default that resulted from such
acceleration). Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.
Section 6.05 Control by Majority.
Holders of a majority in principal amount of the then outstanding
Exchange Debentures 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 Exchange Debentures
or that may involve the Trustee in personal liability and shall be entitled to
the benefit of Section 7.01(c)(iii) hereof.
Section 6.06 Limitation on Suits.
A Holder of an Exchange Debenture may pursue a remedy with respect to
this Indenture or the Exchange Debentures only if:
(i) the Holder of an Exchange Debenture gives to the Trustee
written notice of a continuing Event of Default;
(ii) the Holders of at least 25% in principal amount of the
then outstanding Exchange Debentures make a written request to the
Trustee to pursue the remedy;
(iii) such Holder of an Exchange Debenture or Holders of
Exchange Debentures offer and, if requested, provide to the Trustee
indemnity satisfactory to the Trustee against any loss, liability or
expense;
(iv) 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
(v) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Exchange Debentures do not
give the Trustee a direction inconsistent with the request.
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<PAGE> 49
A Holder of an Exchange Debenture may not use this Indenture to prejudice the
rights of another Holder of an Exchange Debenture or to obtain a preference or
priority over another Holder of an Exchange Debenture.
Section 6.07 Rights of Holders of Exchange Debentures to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of an Exchange Debenture to receive payment of principal, premium and
interest on the Exchange Debentures, on or after the respective due dates
expressed in the Exchange Debentures (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 6.1(i) or (ii) hereof
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 interest remaining unpaid on the Exchange
Debentures 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 compensation, expenses,
disbursements and advances of the Trustee, its agents (including accountants,
experts or such other professionals as the Trustee deems necessary, advisable or
appropriate) and counsel (including the allocated costs of inside counsel)) and
the Holders of the Exchange Debentures allowed in any judicial proceedings
relative to the Company (or any other obligor upon the Exchange Debentures), 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
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<PAGE> 50
any plan of reorganization, arrangement, adjustment or composition affecting the
Exchange Debentures 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 6, 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 Exchange Debentures for amounts due and unpaid on
the Exchange Debentures for principal, premium and interest, ratably, without
preference or priority of any kind, according to the amounts due and payable on
the Exchange Debentures for principal, premium 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 Exchange Debentures 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 6.11 does not apply to a suit by the Trustee, a suit by a Holder of
an Exchange Debenture pursuant to Section 6.07 hereof, or a suit by Holders of
more than 10% in principal amount of the then outstanding Exchange Debentures.
ARTICLE 7
TRUSTEE
Section 7.01 Duties of Trustee.
(i) 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 thereof, as
a prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
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<PAGE> 51
(ii) Except during the continuance of an Event of Default:
(a) 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
(b) in the absence of bad faith on its part, the
Trustee may conclusively rely, without investigation, as to the truth
of the statements and the correctness of the opinions expressed
therein, upon any statements, 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 on their face to the requirements of this
Indenture.
(iii) 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:
(a) this paragraph does not limit the effect of
paragraph (b) of this Section;
(b) 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
(c) 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.
(iv) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
this Section 7.01.
(v) 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 indemnity satisfactory to it against any loss,
liability or expense which might be incurred by it in compliance with such
request or direction.
(vi) 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.
(i) The Trustee may conclusively rely and shall be protected
in acting or refraining from acting upon any document believed by it to be
genuine and to have been signed or
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<PAGE> 52
presented by the proper Person. The Trustee need not investigate any fact or
matter stated in the document.
(ii) 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.
(iii) The Trustee may act through its attorneys, accountants,
experts and such other professionals as the Trustee deems necessary, advisable
or appropriate and shall not be responsible for the misconduct or negligence of
any attorney, accountant, expert or other such professional appointed with due
care.
(iv) 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.
(v) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company shall be sufficiently
evidenced by a written order signed by an Officer of the Company issuing such
demand, request, direction or notice.
(vi) 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 Exchange Debentures 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 within the meaning of the TIA 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 Exchange Debentures, it
shall not be accountable for the Company's use of the proceeds from the Exchange
Debentures or any money paid to the Company or upon the Company's direction
under any provision of this Indenture, it shall not be responsible for the use
or application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Exchange
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<PAGE> 53
Debentures or any other document in connection with the sale of the Exchange
Debentures 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 Exchange Debentures 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
or interest on any Exchange Debentures, 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 Exchange
Debentures.
Section 7.06 Reports by Trustee to Holders of the Exchange Debentures.
Within 60 days after each July 1 beginning with the July 1 following
the date of this Indenture, and for so long as Exchange Debentures remain
outstanding, the Trustee shall mail to the Holders of the Exchange Debentures a
brief report dated as of such reporting date that complies with TIA Section
313(a) (but if no event described in TIA Section 313(a) has occurred within the
twelve months preceding the reporting date, no report need be transmitted). The
Trustee also shall comply with TIA Section 313(b)(2). The Trustee shall also
transmit by mail all reports as required by TIA Section 313(c).
A copy of each report at the time of its mailing to the Holders of
Exchange Debentures shall be mailed to the Company and filed with the SEC and
each stock exchange on which the Exchange Debentures are listed in accordance
with TIA Section 313(d). The Company shall promptly notify the Trustee when the
Exchange Debentures are listed on any stock exchange.
Section 7.07 Compensation, Reimbursement and Indemnity.
The Company 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 shall
reimburse the Trustee promptly upon request for all reasonable disbursements,
advances and expenses incurred or made by or on behalf of it in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's attorneys,
accountants, experts and such other professionals as the Trustee deems
reasonably necessary, advisable or appropriate.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture (including its
duties under Section 9.06 hereof), including the costs and expenses of enforcing
this Indenture against the Company (including this Section 7.07 hereof) and
defending itself against or investigating any claim (whether asserted by the
Company or any Holder or any other person) or liability in connection with the
exercise or performance of any of its powers or duties hereunder, except to the
extent any such loss, liability or expense may be attributable to its gross
negligence or willful misconduct. The Trustee shall notify the Company promptly
of any claim
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<PAGE> 54
for which it may seek indemnity. Failure by the Trustee to so notify the Company
shall not relieve the Company of its obligations hereunder. The Company shall
defend any claim or threatened claim asserted against the Trustee, and the
Trustee shall cooperate in the defense thereof. The Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without their consent,
which consent shall not be unreasonably withheld.
The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Exchange Debentures on all money or
property held or collected by the Trustee, except any money held in trust to pay
principal and interest on particular Exchange Debentures. Such Lien shall
survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01 (vii) or (viii) or (ix) hereof occurs, the
expenses and the compensation for the services (including the fees and expenses
of its agents and counsel) are intended to constitute expenses of administration
under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA Section 313(b)(2)
to the extent applicable.
Section 7.08 Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of Exchange
Debentures of a majority in principal amount of the then outstanding Exchange
Debentures may remove the Trustee by so notifying the Trustee and the Company in
writing. The Company may remove the Trustee if:
(i) the Trustee fails to comply with Section 7.10 hereof;
(ii) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
applicable Bankruptcy Law;
(iii) a Custodian or public officer takes charge of the
Trustee or its property for the purpose of rehabilitation, conservation
or liquidation; or
(iv) 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 Exchange
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<PAGE> 55
Debentures 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 Exchange Debentures of at least 10% in principal amount of the
then outstanding Exchange Debentures may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of an Exchange
Debenture who has been a Holder of an Exchange Debenture for at least six
months, fails to comply with Section 7.10 hereof, such Holder of an Exchange
Debenture may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The Company shall mail a notice of its succession to
Holders of the Exchange Debentures. 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 $100 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
Section 310(a)(1), (2) and (5). The Trustee is subject to TIA Section 310(b).
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
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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 Exchange
Debentures 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 their obligations with respect to all outstanding Exchange
Debentures on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance means that
the Company shall be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Exchange Debentures, 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 of its other Obligations under such Exchange Debentures 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 Exchange
Debentures 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, premium, if any, and interest on such Exchange Debentures when
such payments are due, (b) the Company's obligations with respect to such
Exchange Debentures 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 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 3.09, 4.07, 4.08, 4.09,
4.10, 4.11, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18, 4.19 and 5.01 hereof with
respect to the outstanding Exchange Debentures on and after the date the
conditions set forth below are satisfied (hereinafter, "Covenant Defeasance"),
and the Exchange Debentures 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 Exchange Debentures shall not be deemed outstanding for
accounting purposes). For this purpose, Covenant Defeasance means that, with
respect to the "outstanding" Exchange Debentures, the Company may omit to
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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 6.1 (iii) or (iv) hereof, but, except as specified
above, the remainder of this Indenture and such Exchange Debentures shall be
unaffected thereby. In addition, upon the Company's exercise under Section 8.1
hereof of the option applicable to this Section 8.3, subject to the satisfaction
of the conditions set forth in Section 8.4 hereof, Sections 6.1(iii) through
6.1(vii) 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 Exchange Debentures:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(i) the Company must irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders of the Exchange Debentures, 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, if any, and interest on
the outstanding Exchange Debentures 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 Exchange Debentures are being
defeased to maturity or to a particular redemption date;
(ii) 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 Exchange
Debentures 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;
(iii) 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 Exchange Debentures 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;
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(iv) 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 borrowing of funds to be applied to such
deposit) or insofar as Sections 6.01 (vii) and (viii) hereof are
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);
(v) 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;
(vi) the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that, as of the date of such opinion,
(A) the trust funds will not be subject to the rights of holders of
Indebtedness other than the Exchange Debentures and (B) assuming no
intervening bankruptcy of the Company between the date of deposit and
the 91st day following the deposit, the trust funds will not be subject
to the effects of any applicable bankruptcy, insolvency, reorganization
or similar laws affecting creditors' rights generally under any
applicable United States or state law;
(vii) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the
Company with the intent of preferring the Holders of Exchange
Debentures over the other creditors of the Company, or with the intent
of defeating, hindering, delaying or defrauding any other creditors of
the Company or others; and
(viii) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the Legal Defeasance
or the Covenant Defeasance have been complied with.
Section 8.05 Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding
Exchange Debentures shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Exchange Debentures 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 Exchange Debentures of all sums due and to become due thereon in respect of
principal, premium and interest, but such money need not be segregated from
other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant
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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 Exchange Debentures.
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 the 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 or
interest on any Exchange Debentures and remaining unclaimed for two years after
such principal, and premium 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 Exchange Debentures 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
editions), 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 obligations of the Company under this Indenture and the
Exchange Debentures, as applicable, 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 or interest on any
Exchange Debentures following the reinstatement of its obligations, the Company
shall be subrogated to the rights of the Holders of such Exchange Debentures 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 Exchange Debentures.
Notwithstanding Section 9.02 of this Indenture, the Company and the
Trustee may amend or supplement this Indenture or the Exchange Debentures
without the consent of any Holder of an Exchange Debenture:
(i) to cure any ambiguity, defect or inconsistency;
(ii) to provide for uncertificated Exchange Debentures in
addition to or in place of certificated Exchange Debentures;
(iii) to provide for the assumption of the Company's
obligations to the Holders of the Exchange Debentures in the case of a
merger or consolidation pursuant to Article 5 hereof, as applicable;
(iv) to make any change that would provide any additional
rights or benefits to the Holders of the Exchange Debentures or that
does not adversely affect the legal rights hereunder of any Holder of
Exchange Debentures; or
(v) to comply with the 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 the
Board of Directors of the Company authorizing the execution of any such amended
or supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02 hereof, the Trustee shall join with the Company in the
execution of any amended or supplemental Indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supplemental Indenture that affects its
own rights, duties or immunities under this Indenture or otherwise.
Section 9.02 With Consent of Holders of Exchange Debentures.
Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture and the Exchange Debentures may
be amended or supplemented with the consent of the Holders of at least a
majority in principal amount of the Exchange Debentures then outstanding
(including consents obtained in connection with a purchase of, or tender offer
or exchange offer for the Exchange Debentures), 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 Exchange Debentures) or compliance with any provision of this
Indenture or the Exchange Debentures may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Exchange
Debentures (including
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consents obtained in connection with a purchase of, or tender offer or exchange
offer for the Exchange Debentures). Any amendment to (a) the provisions of
Article 10 hereof and (b) Sections 3.09, 4.11 and 4.13 including the related
definitions will require the consent of the Holders of at least 75% in aggregate
principal amount of the Exchange Debentures then outstanding if such amendment
would adversely affect the rights of Holders of Exchange Debentures.
Upon the request of the Company accompanied by a resolution of the
Board of Directors of the Company 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 Exchange Debentures
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 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 Exchange
Debentures 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 9.02
becomes effective, the Company shall mail to the Holders of Exchange Debentures
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 Exchange
Debentures then outstanding may waive compliance in a particular instance by the
Company with any provision of this Indenture or the Exchange Debentures.
However, without the consent of each Holder affected, an amendment or waiver may
not (with respect to any Exchange Debentures held by a non-consenting Holder):
(i) reduce the principal amount of Exchange Debentures whose
Holders must consent to an amendment, supplement or waiver;
(ii) reduce the principal of or change the fixed maturity of
any Exchange Debentures or alter or waive any of the provisions with
respect to the redemption of the Exchange Debentures (except as
provided above with respect to Sections 3.09, 4.11 and 4.13 hereof);
(iii) reduce the rate of or change the time for payment of
interest, including default interest, on any Exchange Debentures;
(iv) waive a Default or Event of Default in the payment of
principal of or premium or interest on the Exchange Debentures (except
a rescission of acceleration of the Exchange Debentures by the Holders
of at least a majority in aggregate principal amount of the then
outstanding Exchange Debentures and a waiver of the payment default
that resulted from such acceleration);
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(v) make any Exchange Debentures payable in money other than
that stated in the Exchange Debentures;
(vi) make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of
Exchange Debentures to receive payments of principal of or premium, if
any, or interest on the Exchange Debentures;
(vii) waive a redemption payment with respect to any Exchange
Debentures (except as provided above with respect to Sections 3.09,
4.11 and 4.13 hereof); or
(viii) make any change in Section 6.04 or 6.07 hereof or in
the foregoing amendment and waiver provisions.
Section 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Exchange
Debentures 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 an Exchange Debenture is a continuing consent by the Holder
of an Exchange Debenture and every subsequent Holder of an Exchange Debenture or
portion of an Exchange Debenture that evidences the same debt as the consenting
Holder's Exchange Debenture, even if notation of the consent is not made on any
Exchange Debenture. However, any such Holder of an Exchange Debenture or
subsequent Holder of an Exchange Debenture may revoke the consent as to its
Exchange Debenture 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 Exchange Debentures.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Exchange Debenture thereafter authenticated. The
Company in exchange for all Exchange Debentures may issue and the Trustee shall
authenticate new Exchange Debentures that reflect the amendment, supplement or
waiver.
Failure to make the appropriate notation or to issue a new Exchange
Debenture shall not affect the validity and effect of such amendment, supplement
or waiver.
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Section 9.06 Trustee to Sign Amendments, Etc.
The Trustee shall sign any amendment or supplemental Indenture
authorized pursuant to this Article 9 if the amendment does not adversely affect
the rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, sign it. In signing or refusing to sign such
amendment or supplemental Indenture, the Trustee shall be entitled to receive
and, subject to Section 7.01 hereof, shall be fully protected in relying upon,
an Officers' Certificate and an Opinion of Counsel as conclusive evidence that
such amendment or supplemental Indenture is authorized or permitted by this
Indenture, that it is not inconsistent herewith, and that it will be valid and
binding upon the Company in accordance with its terms. The Company may not sign
an amendment or supplemental Indenture until their respective Board of Directors
approves it.
ARTICLE 10
SUBORDINATION
Section 10.01 Agreement to Subordinate.
The Company agrees, and each Holder by accepting an Exchange Debenture
agrees, that the Indebtedness evidenced by the Exchange Debentures is
subordinated in right of payment, to the extent and in the manner provided in
this Article 10, to the prior payment in full 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) so long as any Senior Bank Debt is
outstanding, the Senior Bank Debt and (ii) thereafter, any other Senior Debt
permitted hereunder, the principal amount of which is $25.0 million or more and
that has been designated by the Company as "Designated Senior Debt."
A "distribution" may consist of cash, securities or other property, by
set-off or otherwise.
"Representative" means the indenture trustee or other trustee, agent or
representative for any Senior Debt.
"Senior Bank Debt" means any Indebtedness outstanding under, and any
other Obligations with respect to, Bank Facilities, to the extent that any such
Indebtedness and other Obligations are permitted by this Indenture to be
incurred.
"Senior Debt" means (a) the Senior Bank Debt, (b) all additional
Indebtedness that is permitted under this Indenture that is not by its terms
pari passu with or subordinated to the Exchange Debentures, (c) all Obligations
of the Company with respect to the foregoing clauses (a) and (b), including
post-petition interest and (d) all (including all subsequent) renewals,
extensions, amendments, refinancings, repurchases or redemptions, modifications,
replacements or refundings
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thereto (whether or not coincident therewith) that are permitted by this
Indenture. Notwithstanding anything to the contrary in the foregoing, Senior
Debt shall not include (i) any Indebtedness of the Company to any of its
Subsidiaries, (ii) any Indebtedness incurred for the purchase of goods or
materials or for services obtained in the ordinary course of business (other
than with the proceeds of borrowings from banks or other financial
institutions), (iii) the Series D Exchange Notes or (iv) any Indebtedness
incurred in violation of this Indenture. Notwithstanding the foregoing, the
Exchange Debentures shall be pari passu with the Senior Subordinated Notes (and
the Senior Subordinated Notes shall not constitute Senior Debt hereunder).
Section 10.03 Liquidation; Dissolution; Bankruptcy.
Upon any distribution to creditors of the Company in a liquidation or
dissolution of the Company in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its respective
property, or in an assignment for the benefit of creditors or any marshalling of
the Company's assets and liabilities:
(1) holders of Senior Debt shall be entitled to
receive payment in full 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, whether
or not an allowable claim) before the Holders of Exchange Debentures
shall be entitled to receive any payment with respect to the Exchange
Debentures (except that Holders may receive (i) securities that are
subordinated to at least the same extent as the Exchange Debentures to
(a) Senior Debt and (b) any securities issued in exchange for Senior
Debt 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, any
distribution to which the Holders of Exchange Debentures would be
entitled but for this Article 10 shall be made to holders of Senior
Debt (except that Holders may receive (i) securities that are
subordinated to at least the same extent as the Exchange Debentures to
(a) Senior Debt and (b) any securities issued in exchange for Senior
Debt 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.
(i) The Company may not make any payment or distribution to
the Trustee or any Holder in respect of the Exchange Debentures and may not
acquire from the Trustee or any Holder any Exchange Debentures for cash or
property (other than (1) securities that are subordinated to at least the same
extent as the Exchange Debentures to (A) Senior Debt and (B) any securities
issued in exchange for Senior Debt and (2) 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:
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(i) a default in the payment of the principal of,
premium, if any, or interest on 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 default specified in
Section 10.04(a)(i) hereof, on Designated Senior Debt occurs and is
continuing with respect to Designated Senior Debt that then permits
holders of the Designated Senior Debt as to which such default relates
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 10.04 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 and interest on the Exchange Debentures
that have come due (other than by reason of acceleration) have been
paid in full in cash. No default described in this paragraph (ii) 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.
(ii) The Company may and shall resume payments on and
distributions in respect of the Exchange Debentures and may acquire them (a) in
the case of a default described in Section 10.04(a)(i) hereof, upon the date on
which the default is cured or waived and (b) in the case of a default described
in section 10.04(a)(ii), the earlier of the date on which such default is cured
or waived or 179 days after the date on which the applicable Payment Blockage
Notice is received, unless the maturity of any Designated Senior Debt has been
accelerated.
Section 10.05 Acceleration of Exchange Debentures.
If payment of the Exchange Debentures 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 Exchange Debentures 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.
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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 Exchange Debentures to violate this Article 10, but failure
to give such notice shall not affect the subordination of the Exchange
Debentures 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 Exchange Debentures
are paid in full, Holders shall be subrogated (equally and ratably with all
other Indebtedness pari passu with the Exchange Debentures) 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 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 Exchange
Debentures is not, as between the Company and Holders of Exchange Debentures, a
payment by the Company on the Senior Debt.
Section 10.09 Relative Rights.
This Article 10 defines the relative rights of Holders of Exchange
Debentures and holders of Senior Debt. Nothing in this Indenture shall:
(1) impair, as between the Company and Holders of
Exchange Debentures, the obligation of the Company, which is absolute
and unconditional, to pay principal of and interest on the Exchange
Debentures in accordance with their terms;
(2) affect the relative rights of Holders of Exchange
Debentures 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 Exchange
Debentures 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 Exchange Debentures.
If the Company fails because of this Article 10 to pay principal of or
interest , if any, on an Exchange Debenture on the due date, the failure is
still a Default or Event of Default.
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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 Exchange Debentures shall be impaired by any
act or failure to act by the Company or any Holder of Exchange Debentures or by
the failure of the Company or any Holder of Exchange Debentures 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 Exchange Debentures 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 Exchange Debentures 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 Exchange Debentures, 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 Exchange Debentures to violate this Article 10.
Only the Company or a Representative may give such 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 the Trustee. Any Agent
may do the same with like rights.
Section 10.13 Authorization to Effect Subordination.
Each Holder of an Exchange Debenture by the Holder's acceptance thereof
authorizes and directs the Trustee on the 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 the 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 agent under the Credit
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Agreement (or in the absence of such agent, the lender) is hereby authorized to
file an appropriate claim for and on behalf of the Holders of the Exchange
Debentures.
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
MISCELLANEOUS
Section 11.01 Trust Indenture Act Controls.
If any provision hereof limits, qualifies or conflicts with 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
latter provision shall be deemed to apply to this Indenture as so modified or to
be excluded, as the case may be.
Section 11.02 Notices.
Any notice or communication by the Company or the Trustee to others is
duly given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others' address:
If to the Company:
AMFM Operating Inc.
600 Congress Avenue, Suite 1400
Austin, Texas 78701
Telecopier No.: (512) 340-7890
Attention: William S. Banowsky, Jr.
With a copy to:
Vinson & Elkins L.L.P.
3700 Trammell Crow Center
2001 Ross Avenue
Dallas, Texas 75201
Telecopier No.: (214) 220-7716
Attention: Michael D. Wortley
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If to the Trustee:
United States Trust Company of New York
2001 Ross Avenue, Suite 2700
Dallas, Texas 75201
Telecopier No.: (214) 754-1303
Attention: Bill Barber
The Company or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders of
Exchange Debenture) 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 of Exchange Debentures shall be
mailed by first class mail, certified or registered, return receipt requested,
or by overnight air courier guaranteeing next day delivery to its address shown
on the register kept by the Registrar. Any notice or communication shall also be
so mailed to any Person described in TIA Section 313(c), to the extent required
by the TIA. Failure to mail a notice or communication to a Holder of Exchange
Debentures or any defect in it shall not affect its sufficiency with respect to
other Holders of Exchange Debentures.
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 of Exchange
Debentures, it shall mail a copy to the Trustee and each Agent at the same time.
Section 11.03 Communication by Holders of Exchange Debentures with Other
Holders of Exchange Debentures.
Holders of Exchange Debentures may communicate pursuant to TIA Section
312(b) with other Holders of Exchange Debentures with respect to their rights
under this Indenture or the Exchange Debentures. The Company, the Trustee, the
Registrar and anyone else shall have the protection of TIA Section 312(c).
Section 11.04 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:
62
<PAGE> 70
(i) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set
forth in Section 11.05 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
(ii) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set
forth in Section 11.05 hereof) stating that, in the opinion of such
counsel, all such conditions precedent and covenants have been
satisfied.
Section 11.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA Section 314(a)(4)) shall comply with the provisions of TIA
Section 314(e) and shall include:
(i) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(ii) 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;
(iii) 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
(iv) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied.
Section 11.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders of Exchange Debentures. The Registrar or Paying Agent may make
reasonable rules and set reasonable requirements for its functions.
Section 11.07 No Personal Liability of Directors, Officers, Employees and
Stockholders.
No director, officer, employee, incorporator or stockholder of the
Company, as such, shall have any liability for any obligations of the Company,
as applicable, under the Exchange Debentures, this Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder of an Exchange Debenture by acceptance thereof waives and releases
all such liability. The waiver and release are part of the consideration for
issuance of the Exchange Debentures.
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<PAGE> 71
Section 11.08 Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE EXCHANGE DEBENTURES.
Section 11.09 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 11.10 Successors.
All agreements of the Company in this Indenture and the Exchange
Debentures shall bind their successors. All agreements of the Trustee in this
Indenture shall bind its successors.
Section 11.11 Severability.
In case any provision in this Indenture or the Exchange Debentures
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 11.12 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 11.13 Table of Contents, Headings, Etc.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture, which 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]
64
<PAGE> 72
SIGNATURES
IN WITNESS WHEREOF, the parties have executed this Indenture as of the
date first written above.
Very truly yours,
AMFM OPERATING INC.
By: /s/ W. SCHUYLER HANSEN
------------------------------------
W. Schuyler Hansen
Senior Vice President and
Chief Accounting Officer
UNITED STATES TRUST COMPANY OF
NEW YORK
By: /s/ BILL BARBER
------------------------------
Bill Barber
Vice President
65
<PAGE> 73
EXHIBIT A
(Face of Exchange Debenture)
12 5/8% Senior Subordinated Exchange Debentures due 2006
CUSIP: 001694 AA 6
No. $
--------------
AMFM Operating Inc.
promise to pay to _____________ or registered assigns, the principal sum of
_____________ Dollars on October 31, 2006
Interest Payment Dates: January 15 and July 15
Record Dates: January 1 and July 1
Dated:
AMFM OPERATING INC.
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
This is one of the
Exchange Debentures referred to in
within-mentioned Indenture
- ---------------------------
as Trustee
By:
------------------------
A-1
<PAGE> 74
'
(Back of Exchange Debenture)
12 5/8% Senior Subordinated Exchange Debentures due 2006
[Unless and until it is exchanged in whole or in part for Exchange
Debentures in definitive form, this Exchange Debenture may not be transferred
except as a whole by the Depositary to a nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of the Depositary
or by the Depositary or any such nominee to a successor Depositary or a nominee
of such successor Depositary. Unless this certificate is presented by an
authorized representative of The Depository Trust Company (55 Water Street, New
York, New York) ("DTC"), to the issuers or their agent for registration of
transfer, exchange or payment, and any certificate issued is registered in the
name of Cede & Co. or such other name as may be requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or such other
entity as may be requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.](1)
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. AMFM Operating Inc., a Delaware corporation (the
"Company") promises to pay interest on the principal amount of this Exchange
Debenture at 12 5/8% per annum from the date hereof until maturity. The Company
will pay interest semi-annually on January 15 and July 15 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest on the Exchange Debentures 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. 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 (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 Exchange
Debentures (except defaulted interest) to the Persons who are registered Holders
of Exchange Debentures at the close of business on the January 1 or July 1 next
preceding the Interest Payment Date, even if such Exchange Debentures are
canceled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.11 of the Indenture with respect to defaulted
interest. Any such interest installment not punctually paid or duly provided for
shall forthwith cease to be payable to the registered Holders on such Interest
Payment Date, and may be paid to the registered Holders at the close of business
on a special interest payment date to be fixed by the Trustee for the payment of
such defaulted interest, notice whereof shall be given to the registered Holders
not less than 15 days prior to such special interest payment date, or may be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Exchange Debentures may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in the Indenture. The Exchange Debentures will be payable as to
- --------
(1) To be included only if the Exchange Debenture is issued in global
form.
A-2
<PAGE> 75
principal, premium and interest at the office or agency of the Company
maintained for such purpose within or without the City and State of New York,
or, at the option of the Company, payment of interest may be made by check
mailed to the Holders at their addresses set forth in the register of Holders,
and provided that payment by wire transfer of immediately available funds will
be required with respect to principal of and interest and premium on, all Global
Exchange Debentures and all other Exchange Debentures 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 for payment is legal tender for payment of public and private
debts.
3. PAYING AGENT AND REGISTRAR. Initially, United States Trust Company
of New York, the Trustee under the Indenture, will act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar without notice
to any Holder. The Company may act in any such capacity.
4. INDENTURE. The Company issued the Exchange Debentures under an
Indenture dated as of _____________, 19__ (the "Indenture") between the Company
and the Trustee. The terms of the Exchange Debentures include those stated in
the Indenture and those made part of the indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 7aaa-77bbbb). The
Exchange Debentures are subject to all such terms, and Holders are referred to
the Indenture and such Act for a statement of such terms. The Exchange
Debentures are general obligations of the Company limited to $415,000,000
million in aggregate principal amount. Capitalized terms used herein but not
defined herein shall have the meanings assigned to them in the Indenture.
5. OPTIONAL REDEMPTION.
(a) Except as provided in paragraph 5(b) below, the Exchange Debentures
will not be redeemable at the Company's option prior to January 15, 2002.
Thereafter, the Exchange Debentures will be subject to redemption at the option
of the Company, 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 thereon to the
applicable redemption date, if redeemed during the twelve-month period beginning
on January 15, 2002 of the years indicated below:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
- ---- ----------
<S> <C>
2002........................................ 106.313%
2003........................................ 104.734%
2004........................................ 103.156%
2005........................................ 101.578%
2006 and thereafter......................... 100.000%
</TABLE>
(b) In addition, prior to January 15, 2000, the Company may, at its
option, redeem up to 50% of the aggregate of (i) the liquidation preference of
the Series E Preferred Stock issued (whether initially issued or issued in lieu
of cash dividends) less the liquidation preference of Series E Preferred Stock
exchanged for Exchange Debentures and (ii) the principal amount of Exchange
Debentures issued (whether issued in exchange for Series E Preferred Stock of in
lieu of cash interest), with the net proceeds of one or more Common Equity
offerings received on or after the date of original issuance of the Series E
Preferred Stock at a redemption price of 112.625% of the liquidation preference
or principal amount, as the case may be, plus accumulated and unpaid dividends
in the case of Series E Preferred Stock and accrued and unpaid
A-3
<PAGE> 76
interest in the case of Exchange Debentures; provided, that after any such
redemption, if any Series E Preferred Stock or Exchange Debentures remain
outstanding, at least $50 million in liquidation preference or principal amount,
as applicable, of the Series E Preferred Stock or Exchange Debentures, as the
case may be, remain outstanding; and provided further, that any such redemption
shall occur within 75 days of the date of closing of 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 Exchange Debentures.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be required to
make an offer (a "Change of Control Offer") to repurchase all or any part of
each Holder's Exchange Debentures at a purchase price equal to 101% of the
principal amount thereof plus, in each case, accrued and unpaid interest, if
any, to the date of purchase (in either case, the "Change of Control Payment").
Within 10 days following any Change of Control, the Company shall mail a notice
to each Holder setting forth the procedures governing the Change of Control
Offer as required by the Indenture.
(b) If the Company consummates any Asset Sale, within fifteen Business
Days of each date on which the aggregate amount of Excess Proceeds exceeds $10.0
million, the Company shall commence an offer to all Holders of Exchange
Debentures and the holders of Pari Passu Debt to the extent required by the
terms thereof (an "Asset Sale Offer") pursuant to Section 3.09 of the Indenture
to purchase the maximum principal amount of Exchange Debentures and any such
Pari Passu Debt 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 to the date fixed for the closing of such offer, in
accordance with the procedures set forth in the Indenture or the agreements
governing Pari Passu Debt, as applicable. To the extent that the aggregate
amount of the Exchange Debentures and Pari Passu Debt tendered pursuant to an
Asset Sale Offer is less than the Excess proceeds, the Company may use such
deficiency for general corporate purposes. If the aggregate principal amount of
Exchange Debentures and Pari Passu Debt surrendered by Holders thereof exceeds
the amount of Excess Proceeds, the Trustee shall select the Exchange Debentures
and Pari Passu Debt to be purchased on a pro rata basis. Holders of Exchange
Debentures that are the subject of an offer to purchase will receive an Asset
Sale Offer from the Company prior to any related purchase date and may elect to
have such Exchange Debentures purchased by completing the form entitled "Option
of Holder to Elect Purchase" on the reverse of the Exchange Debentures.
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 Exchange Debentures are to be redeemed at its registered address. Exchange
Debentures in denominations larger than $1000 may be redeemed in part but only
in whole multiples of $1000, unless all of the Exchange Debentures held by a
Holder are to be redeemed. On and after the redemption date interest ceases to
accrue on Exchange Debentures or portions thereof called for redemption.
9. SUBORDINATION. Each Holder by accepting an Exchange Debenture agrees
that the payment of principal of, premium and interest on each Exchange
Debenture is subordinated in right of payment, to the extent and in the manner
provided in Article 10 of the Indenture, to the prior payment in full of all
Senior Debt (whether outstanding on the date of the Indenture or thereafter
created, incurred, assumed or guaranteed), and that the subordination is for the
benefit of the holders of Senior Debt.
A-4
<PAGE> 77
10. DENOMINATIONS, TRANSFER, EXCHANGE. The Exchange Debentures are in
registered form without coupons in all appropriate denominations. The transfer
of Exchange Debentures may be registered and Exchange Debentures 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 Exchange Debenture or portion of a
Exchange Debenture selected for redemption, except for the unredeemed portion of
any Exchange Debenture being redeemed in part. Also, it need not exchange or
register the transfer of any Exchange Debentures for a period of 15 days before
a selection of Exchange Debentures to be redeemed or during the period between a
record date and the corresponding Interest Payment Date.
11. PERSONS DEEMED OWNERS. The registered Holder of an Exchange
Debenture may be treated as its owner for all purposes.
12. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture or the Exchange Debentures may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the then
outstanding Exchange Debentures, and any existing default or compliance with any
provision of the Indenture or the Exchange Debentures may be waived with the
consent of the Holders of a majority in principal amount of the then outstanding
Exchange Debentures. Without the consent of any Holder of an Exchange Debenture,
the Indenture or the Exchange Debentures may be amended or supplemented to cure
any ambiguity, defect or inconsistency, to provide for uncertificated Exchange
Debentures in addition to or in place of certificated Exchange Debentures, to
provide for the assumption of the Company's obligations to Holders of the
Exchange Debentures in case of a merger or consolidation, to make any change
that would provide any additional rights or benefits to the Holders of the
Exchange Debentures 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. Any amendment to the provisions of Article 10 of the Indenture
and Sections 3.09, 4.11 and 4.13 including, in each case, the related
definitions will require the consent of the Holders of at least 75% in aggregate
principal amount of the Exchange Debentures then outstanding if such amendment
would adversely affect the rights of Holders of Exchange Debentures.
13. DEFAULTS AND REMEDIES. Events of Default include: (i) a default for
30 days in the payment when due of interest on the Exchange Debentures (whether
or not prohibited by Article 10 of the Indenture); (ii) a default in payment
when due of the principal of or premium, if any, on the Exchange Debentures
(whether or not prohibited by Article 10 of the Indenture); (iii) the failure by
the Company to comply with the provisions described under Sections 3.09, 4.07,
4.08, 4.11, and 4.13 of the Indenture; (iv) the failure by the Company for 60
days after notice to comply with any of its other agreements in the Indenture or
the Exchange Debentures; (v) a default 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
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
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
A-5
<PAGE> 78
been so accelerated, aggregates $25.0 million or more; (vi) the failure by the
Company or any of its Subsidiaries 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; (vii) certain events of bankruptcy or insolvency with respect
to the Company or any of its Significant Subsidiaries or a group of Subsidiaries
that, taken as a whole, 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 Exchange Debentures may declare all
the Exchange Debentures to be due and payable. Notwithstanding the foregoing, in
the case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Exchange Debentures will become due and payable
without further action or notice. Holders may not enforce the Indenture or the
Exchange Debentures except as provided in the Indenture. Subject to certain
limitations, Holders of a majority in principal amount of the then outstanding
Exchange Debentures may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Holders of the Exchange Debentures 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. The Holders of a majority in aggregate
principal amount of the Exchange Debentures then outstanding by notice to the
Trustee may on behalf of the Holders of all of the Exchange Debentures 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 or
the principal of, the Exchange Debentures. 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.
14. TRUSTEE DEALINGS WITH THE COMPANY. The Trustee, in its individual
or any other capacity, may make loans to, accept deposits from, and perform
services for its Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
15. 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 Exchange Debentures or
the Indenture, as applicable, or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting an
Exchange Debenture waives and releases all such liability. The waiver and
release are part of the consideration for the issuance of the Exchange
Debentures.
16. AUTHENTICATION. This Exchange Debenture shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
17. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenant 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).
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 Exchange Debentures and the Trustee may use
CUSIP numbers in notices of redemption as a convenience to Holders. No
representations are made as to the accuracy of such numbers either as printed on
the Exchange Debentures or as contained in any notice of redemption and reliance
may be placed only on the other identification numbers placed thereon.
A-6
<PAGE> 79
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
AMFM Operating Inc.
600 Congress Avenue, Suite 1400
Austin, Texas 78701
Attention: William S. Banowsky, Jr.
A-7
<PAGE> 80
ASSIGNMENT FORM
To assign this Exchange Debenture, fill in the form below: (I) or (we)
assign and transfer this Exchange Debenture 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 Exchange Debenture 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 Exchange Debenture)
Signature Guarantee:
-----------------------------------------------
A-8
<PAGE> 81
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Exchange Debenture purchased by the
Company pursuant to Section 4.11 or 4.13 of the Indenture, check the box below:
[ ] Section 4.11 [ ] Section 4.13
If you want to elect to have only part of the Exchange Debenture
purchased by the Company pursuant to Section 4.11 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 Exchange Debenture)
Tax Identification Number:
-----------------------------------------------
Signature Guarantee:
-----------------------------------------------
A-9
<PAGE> 82
SCHEDULE OF EXCHANGES OF CERTIFICATED EXCHANGE DEBENTURES
The following exchanges of a part of this Global Exchange Debenture for
Certificated Exchange Debentures have been made:
<TABLE>
<CAPTION>
Principal Amount of this
Amount of decrease in Amount of increase in Global Exchange Signature of
Principal Amount of Principal Amount of Debenture following authorized officer of
this Global Exchange this Global Exchange such decrease (or Trustee or Exchange
Date of Exchange Debenture Debenture increase) Debenture Custodian
---------------- --------- --------- --------- -------------------
<S> <C> <C> <C> <C>
</TABLE>
A-10
