<PAGE> 1
FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________ to _____________________
Commission file number 0-15392
REGENT COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Delaware 31-1492857
(State or other jurisdiction of (I.R.S. Employer
in corporation or organization) Identification No.)
50 East RiverCenter Boulevard
Suite 180
Covington, Kentucky 41011
(Address of principal executive offices)
(Zip Code)
(606) 292-0030
(Registrant's telephone number, including area code)
--------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter periods that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes No X
----- -----
Indicate the number of shares outstanding of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock - $.01 Par Value - 240,000 shares as of August 18, 1998.
<PAGE> 2
REGENT COMMUNICATIONS, INC.
FORM 10-Q
FOR THE QUARTER ENDED JUNE 30, 1998
INDEX
-----
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements*
Condensed Consolidated Balance Sheets as of
June 30, 1998 and December 31, 1997*
Condensed Consolidated Statements of Operations
for the three months and six months ended June 30, 1998
and June 30, 1997*
Condensed Consolidated Statements of Cash Flows
for the six months ended June 30, 1998
and June 30, 1997*
Notes to Consolidated Condensed Financial Statements*
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations*
*To be supplied by amendment.
PART II - OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds
Item 4. Submission of Matters to a Vote of Security Holders
Item 6. Exhibits and Reports on Form 8-K
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
The information required by this item will be filed by amendment.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The information required by this item will be filed by amendment.
PART II - OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds
(c) On June 15, 1998, Regent Communications, Inc. (the "Company")
acquired control of 31 radio stations located in California, Arizona, Michigan
and Ohio through acquisitions of assets or stock for cash or by way of merger
transactions (the "June 15 Transactions"). The cash needed for the June 15
Transactions was provided by bank financing from the Company's senior credit
facility with Bank of Montreal, Chicago Branch, General Electric Capital
Corporation and Bank One, Indianapolis, NA, and by the proceeds from the sale
of shares of the Company's convertible preferred stock. Additional shares of
the Company's convertible preferred stock were issued in the merger
transactions. In addition to 3,720,796 shares of the Company's Series C
Convertible Preferred Stock, and options for the purchase of 274,045 shares
thereof, issued in the merger transaction with Faircom Inc. pursuant to a
registration statement filed under the Securities Act of 1933, convertible
preferred stock was issued by the Company on June 15, 1998, as follows, and
such stock or the proceeds thereof were used to fund the June 15 Transactions:
1. The Company issued to the purchasers set forth below a total of
2,050,000 shares of its Series F Convertible Preferred Stock at a purchase price
of $5.00 per share, and in conjunction therewith, issued to such purchasers
warrants to purchase a total of 860,000 shares of the Company's Common Stock at
an exercise price of $5.00 per share.
<TABLE>
<CAPTION>
NUMBER OF SHARES NUMBER OF WARRANTS
NAME OF PURCHASER PURCHASED RECEIVED
<S> <C> <C>
Waller-Sutton Media Partners, L.P. 1,000,000 650,000
WPG Corporate Development
Associates V, L.P. 562,900 112,580
WPG Corporate Development
Associates (Overseas) V, L.P. 87,100 17,420
General Electric Capital Corporation 250,000 50,000
River Cities Capital Fund Limited
Partnership 100,000 20,000
William H. Ingram 50,000 10,000
</TABLE>
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The Series F Convertible Preferred Stock is convertible into shares of the
Company's Common Stock on a 1-for-1 basis at any time at the option of the
holders and under certain circumstances at the option of the Company. The
warrants are exercisable in whole or in part (but unless exercised in full,
only for whole shares of common stock) at any time on or before the tenth
anniversary of the date of issuance of the warrants.
2. General Electric Capital Corporation ("GE Capital") paid
$3,900,000 cash to complete its purchase of shares of the Company's Series B
Senior Convertible Preferred Stock, pursuant to the terms of its Stock Purchase
Agreement and Promissory Note dated December 8, 1997. The Series B Senior
Convertible Preferred Stock is convertible into shares of the Company's Common
Stock on a .5-for-1 basis at any time at the option of the holder and under
certain circumstances at the option of the Company. In addition, the Company
issued to GE Capital a warrant to purchase 50,000 shares of the Company's
Common Stock at an exercise price of $5.00 per share. The warrant is
exercisable in whole or in part (but unless exercised in full, only for whole
shares of common stock) at any time on or before the fifth anniversary of the
date of issuance of the warrant.
3. BMO Financial, Inc. paid $3,900,000 cash for 780,000 shares of
the Company's Series D Convertible Preferred Stock. The Series D Convertible
Preferred Stock is convertible into shares of the Company's Common Stock on a
1-for-1 basis at any time, subject to certain conditions, and under certain
circumstances at the option of the Company.
4. William L. Stakelin, a member of the Company's Board of
Directors, as well as its President, Chief Operating Officer and Secretary,
purchased 20,000 shares of the Company's Series A Convertible Preferred Stock at
a purchase price of $5.00 per share. The Series A Convertible Preferred Stock is
convertible into shares of the Company's Common Stock on a 1-for-1 basis at any
time at the option of the holder and under certain circumstances at the option
of the Company.
5. As part of the Company's acquisition of all of the outstanding
stock of Alta California Broadcasting, Inc. ("Alta") by virtue of a merger of
Alta into a wholly-owned subsidiary of the Company, the Company issued 205,250
shares of its Series E Convertible Preferred Stock (stated value $5.00 per
share) as follows: 194,750 shares were issued to the seller, Redwood
Broadcasting, Inc. (of which 20,000 shares are currently being held in escrow
pursuant to an indemnification agreement between the Company and the seller),
and 10,500 shares were issued to Miller Capital Corp., as partial payment of
commissions payable to it. The Series E Convertible Preferred Stock is
convertible into shares of the Company's Common Stock on a 1-for-1 basis at
the option of the holder at any time and under certain circumstances at the
option of the Company.
6. As part of the Company's acquisition of all of the outstanding
stock of Topaz Broadcasting, Inc. ("Topaz") by virtue of a merger of Topaz into
a wholly-owned subsidiary of the Company, the Company issued 242,592 shares of
the Company's Series E Convertible Preferred Stock to the seller, Thomas Gammon.
7. Effective as of June 15, 1998, the Company granted, under its
1998 Management Stock Option Plan, to each of Terry S. Jacobs (a member of the
Company's Board of Directors, as well as its Chairman, Chief Executive Officer
and Treasurer) and William L. Stakelin (a member of the Company's Board of
Directors, as well as its President, Chief Operating Officer and Secretary)
options to purchase 608,244 shares of the Company's Common Stock at a price of
$5.00 per share. Of the options granted, the maximum allowable will be treated
as incentive stock options, which vest over ten years (10% per year) and are
exercisable in equal one-tenth increments commencing on the date of grant and
continuing on each anniversary of the date of grant. The balance of the options
will be non-qualified stock options, which will vest over three years (33% each
year) and will become exercisable in equal one-third increments commencing at
the end of the first year following the date of the grant.
8. The Company issued to River Cities Capital Fund Limited
Partnership ("River Cities") a warrant to purchase 80,000 shares of the
Company's Common Stock at an exercise price of $5.00 per share. The warrant is
exercisable in whole or in part (but unless exercised in full, only for whole
shares) at any time on or before the fifth anniversary of the issuance of the
warrant. The warrant was issued as an inducement to River Cities, as an
existing holder of the Company's Series A Convertible Preferred Stock, to
approve the acquisition by the Company of all of the outstanding stock of
Faircom Inc. through a merger with the Company's wholly-owned subsidiary,
including the issuance by the Company of shares of its Series C Convertible
Preferred Stock in exchange therefor (one of the June 15 Transactions).
The foregoing securities were issued by the Company in privately
negotiated transactions based upon exemptions from registration under the
Securities Act of 1933, as amended (the "1933 Act"), claimed pursuant to Section
4(2) of the 1933 Act and the rules and regulations promulgated thereunder.
Item 4. Submission of Matters to a Vote of Security Holders
On June 15, 1998, the stockholders of the Company unanimously
consented in a writing without a meeting as permitted by the provisions of the
Delaware General Corporation Law to: (i) the issuance of shares of the
Company's Series F Convertible Preferred Stock and warrants to purchase the
Company's Common Stock pursuant to that certain Amended and Restated
Stockholders' Agreement dated as of December 8, 1997 (the "Stockholder's
Agreement"); and (ii) the adoption of the Amended and Restated Certificate of
Incorporation of the Company attached to the Stockholders' Agreement.
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Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
The following will be filed as an exhibit to Part I of this
Form 10-Q by the filing of an amendment hereto:
Exhibit No. 27 Financial Data Schedule
The exhibits identified as Part II Exhibits on the following
Exhibit Index, which is incorporated herein by this reference, are filed or
incorporated by reference as exhibits to Part II of this Form 10-Q.
(b) Reports on Form 8-K
On June 30, 1998, the Company filed a report on Form 8-K,
reporting under Items 2 and 5, disclosing the consummation of a series of
transactions on June 15, 1998 pursuant to which the Company acquired control of
31 radio stations through acquisitions of assets or stock for cash or by way of
merger transactions, the financing of said transactions through the Company's
senior credit facility and by the issuance and the proceeds of the sale of
shares of the Company's convertible preferred stock, most of which having full
voting rights, and the resulting change in control of the Company's voting stock
previously held 51.3% by Terry S. Jacobs. The historical financial statements
and the pro forma financial information required to be filed as part of this
Form 8-K was not filed with the initial report. The Company intends to file such
financial statements and information on or before August 31, 1998.
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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 hereunto duly authorized.
REGENT COMMUNICATIONS, INC.
Date: August 19, 1998 By: /s/ TERRY S. JACOBS
------------------------------------------
Terry S. Jacobs, Chairman of the Board and
Chief Executive Officer
Date: August 19, 1998 By: /s/ MATTHEW A. YEOMAN
------------------------------------------
Matthew A. Yeoman,
Vice President - Finance
(Principal Accounting Officer)
S-1
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EXHIBIT INDEX
-------------
Part I Exhibits:
- -----------------
The following will be filed as an exhibit to Part I of this Form 10-Q
by an amendment hereto:
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
- ------ -------------------
27# Financial Data Schedule
#To be supplied by amendment.
Part II Exhibits:
- ----------------
The following exhibits are filed, or incorporated by reference where
indicated, as part of Part II of this Report on Form 10-Q:
E-1
<PAGE> 8
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
- ------ -------------------
4(a)* Amended and Restated Certificate of Incorporation of Regent
Communications, Inc. (previously filed as Exhibit 4(a) to the
Registrant's Form 8-K filed June 30, 1998 and incorporated
herein by this reference).
4(b)* Amended and Restated By-Laws of Regent Communications, Inc.
(previously filed as Exhibit 3(b) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998 and
incorporated herein by this reference).
4(c)* Second Amended and Restated Stockholders' Agreement dated as
of June 15, 1998 among Regent Communications, Inc., Terry S.
Jacobs, William L. Stakelin, Waller-Sutton Media Partners,
L.P., William H. Ingram, WGP Corporate Development Associates
V, L.P., WGP Corporate Development Associates (Overseas) V,
L.P., River Cities Capital Fund Limited Partnership, BMO
Financial, Inc., General Electric Capital Corporation, Joel M.
Fairman, Miami Valley Venture Fund II Limited Partnership, and
Blue Chip Capital Fund II Limited Partnership (excluding
exhibits not deemed material or filed separately in executed
form) (previously filed as Exhibit 4(c) to the Registrant's
Form 8-K filed June 30, 1998 and incorporated herein by this
reference).
E-2
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EXHIBIT
NUMBER EXHIBIT DESCRIPTION
- ------ -------------------
4(d)* Stock Purchase Agreement dated June 15, 1998 among Regent
Communications, Inc., Waller-Sutton Media Partners, L.P., WPG
Corporate Development Associates V, L.P., WPG Corporate
Development Associates (Overseas) V, L.P., General Electric
Capital Corporation, River Cites Capital Fund Limited
Partnership and William H. Ingram (excluding exhibits not
deemed material or filed separately in executed form)
(previously filed as Exhibit 4(d) to the Registrant's Form
8-K filed June 30, 1998 and incorporated herein by this
reference).
4(e)* Registration Rights Agreement dated June 15, 1998 among Regent
Communications, Inc., PNC Bank, N.A., Trustee, Waller-Sutton
Media Partners, L.P., WPG Corporate Development Associates V,
L.P., WPG Corporate Development Associates (Overseas) V, L.P.,
BMO Financial, Inc., General Electric Capital Corporation,
River Cites Capital Fund Limited Partnership, Terry S. Jacobs,
William L. Stakelin, William H. Ingram, Blue Chip Capital Fund
II Limited Partnership, Miami Valley Venture Fund L.P. and
Thomas Gammon (excluding exhibits not deemed material or filed
separately in executed form) (previously filed as Exhibit
4(e) to the Registrant's Form 8-K filed June 30, 1998 and
incorporated herein by this reference).
4(f)* Warrant for the Purchase of 650,000 Shares of Common Stock
issued by Regent Communications, Inc. to Waller-Sutton Media
Partners, L.P. dated June 15, 1998 (See Note 1 below)
(previously filed as Exhibit 4(f) to the Registrant's Form
8-K filed June 30, 1998 and incorporated herein by this
reference).
4(g)* Warrant for the Purchase of 50,000 Shares of Common Stock
issued by Regent Communications, Inc. to General Electric
Capital Corporation dated June 15, 1998 (previously filed as
Exhibit 4(g) to the Registrant's Form 8-K filed June 30,
1998 and incorporated herein by this reference).
4(h)* Agreement to Issue Warrant dated as of June 15, 1998 between
Regent Communications, Inc. and General Electric Capital
Corporation (excluding exhibits not deemed material or filed
separately in executed form) (previously filed as Exhibit
4(h) to the Registrant's Form 8-K filed June 30, 1998 and
incorporated herein by this reference).
4(i) Grant of Incentive Stock Option effective June 15, 1998 in
favor of Terry S. Jacobs.
4(j) Grant of Incentive Stock Option effective June 15, 1998 in
favor of William S. Stakelin.
4(k) Warrant for the Purchase of 80,000 Shares of Common Stock
issued by Regent Communications, Inc. to River Cities
Capital Fund Limited Partnership dated June 15, 1998.
4(l)* Stock Purchase Agreement dated as of May 20, 1997 between
Terry S. Jacobs and Regent Communications, Inc. (previously
filed as Exhibit 4(b) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998
and incorporated herein by this reference).
4(m)* Stock Purchase Agreement dated as of May 20, 1997 between
River Cities Capital Fund Limited Partnership and Regent
Communications, Inc. (previously filed as Exhibit 4(c) to the
Registrant's Form S-4 Registration Statement No. 333-46435
effective May 7, 1998 and incorporated herein by this
reference).
4(n)* Stock Purchase Agreement dated as of November 26, 1997 and
Terry S. Jacobs and Regent Communications, Inc. (previously
filed as Exhibit 4(d) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998
and incorporated herein by this reference).
E-3
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4(o)* Stock Purchase Agreement dated as of December 1, 1997
between William L. Stakelin and Regent Communications,
Inc. (previously filed as Exhibit 4(e) to the Registrant's
Form S-4 Registration Statement No. 333-46435 effective
May 7, 1998 and incorporated herein by this reference).
4(p)* Stock Purchase Agreement dated as of December 8, 1997
between Regent Communications, Inc. and General Electric
Capital Corporation (previously filed as Exhibit 4(f) to
the Registrant's Form S-4 Registration Statement No.
333-46435 effective May 7, 1998 and incorporated herein by
this reference).
4(q)* Stock Purchase Agreement dated as of December 8, 1997
between Regent Communications, Inc. and BMO Financial,
Inc. (previously filed as Exhibit 4(g) to the Registrant's
Form S-4 Registration Statement No. 333-46435 effective
May 7, 1998 and incorporated herein by this reference).
4(r)* Amended and Restated Redemption and Warrant Agreement
dated as of March 31, 1998 among Regent Communications,
Inc., Blue Chip Capital Fund II Limited Partnership,
Miami Valley Venture Fund L.P. and Faircom Inc. (previously
filed as Exhibit 4(i) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998
and incorporated herein by this reference).
4(s)* Credit Agreement dated as of November 14, 1997 among
Regent Communications, Inc., the lenders listed therein,
as Lenders, General Electric Capital Corporation, as
Documentation Agent and Bank of Montreal, Chicago Branch,
as Agent (excluding exhibits not deemed material or filed
separately in executed form) (previously filed as Exhibit
4(j) to the Registrant's Form S-4 Registration Statement
No. 333-46435 effective May 7, 1998 and incorporated herein
by this reference).
4(t)* Revolving Note issued by Regent Communications, Inc. to
Bank of Montreal, Chicago Branch dated November 14, 1997
in the principal amount of $20,000,000 (See Note 2 below)
(previously filed as Exhibit 4(k) to the Registrant's Form
S-4 Registration Statement No. 333-46435 effective May 7,
1998 and incorporated herein by this reference).
4(u)* Agreement to Issue Warrant dated as of March 25, 1998
between Regent Communications, Inc. and River Cities
Capital Fund Limited Partnership (previously filed as
Exhibit 4(l) to the Registrant's Form S-4 Registration
Statement No. 333-46435 effective May 7, 1998 and
incorporated herein by this reference).
4(v)* Regent Communications, Inc. Faircom Conversion Stock
Option Plan (previously filed as Exhibit 4(m) to the
Registrant's Form S-4 Registration Statement No. 333-46435
effective May 7, 1998 and incorporated herein by this
reference).
10(a)* Executive Employment Agreement dated June 15, 1998 between
Regent Communications, Inc. and Joel M. Fairman (excluding
exhibits not deemed material or filed separately in
executed form) (previously filed as Exhibit 20(c) to the
Registrant's Form 8-K filed June 30, 1998 and incorporated
herein by this reference).
10(b)* Consulting and Non-Competition Agreement between Regent
Communications, Inc. and James H. Levy (previously filed as
Exhibit 20(d) to the Registrant's Form 8-K filed June 30,
1998 and incorporated herein by this reference).
E-4
<PAGE> 11
*Incorporated by reference.
Notes:
1. Six substantially identical Warrants for the purchase of shares of
Registrant's common stock were issued as follows:
Waller-Sutton Media Partners, L.P. 650,000
WPG Corporate Development Associates V, L.P. 112,580
WPG Corporate Development Associates (Overseas) V, L.P. 17,420
General Electric Capital Corporation 50,000
River Cites Capital Fund Limited Partnership 20,000
William H. Ingram 10,000
2. Two substantially identical notes were issued to Bank of Montreal,
Chicago Branch in the principal amounts of $15,000,000 and $20,000,000.
E-5
<PAGE> 1
EXHIBIT 4(i)
Regent Communications, Inc. 1998 Management Stock Option Plan
GRANT OF INCENTIVE STOCK OPTION
Date of Grant: June 15, 1998
THIS GRANT, dated as of the date of grant first stated above (the "Date
of Grant"), is delivered by Regent Communications, Inc., a Delaware corporation
("Regent") to Terry S. Jacobs (the "Grantee"), who is a key management employee
of Regent (sometimes referred to herein as the "Employer").
WHEREAS, the Board of Directors of Regent (the "Board") on February 16,
1998, adopted, with stockholder approval, the Regent Communications, Inc. 1998
Management Stock Option Plan (the "Plan");
WHEREAS, the Plan provides for the granting of Incentive Stock Options
("ISOs") and/or Non-Qualified Stock Options ("NQSOs") by a committee to be
appointed by the Board (the "Committee") to key management employees of Regent
or any subsidiary of Regent to purchase shares of the Common Stock of Regent
(the "Stock"), in accordance with the terms and provisions thereof; and
WHEREAS, the Committee considers the Grantee to be a person who is
eligible for a grant of stock options under the Plan, and has determined that it
would be in the best interest of Regent to grant the stock options documented
herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. GRANT OF OPTION. Subject to the terms and conditions hereinafter set
forth, Regent, with the approval and at the direction of the Committee, hereby
grants to the Grantee, as of the Date of Grant, an option to purchase up to
608,244 shares of Stock at a price of $5.00 per share, which amount is not less
than the fair market value of the Stock as of the Date of Grant. Such option is
hereinafter referred to as the "Option" and the shares of stock purchasable upon
exercise of the Option are hereinafter sometimes referred to as the "Option
Shares." To the greatest extent possible, the Option is intended by the parties
hereto to be, and shall be, treated as an Incentive Stock Option as such term is
defined under Section 422 of the Internal Revenue Code of 1986, as amended and
such Options shall be referred to herein as "ISOs." All Options which do not
qualify as ISOs shall be Non-Qualified Stock Options and shall be referred to
herein as "NQSOs."
<PAGE> 2
2. INSTALLMENT EXERCISE OF ISOS. Subject to such further limitations as
are provided herein, the ISOs granted hereunder shall become exercisable in ten
(10) installments, the Grantee having the right hereunder to purchase from
Regent the following number of Option Shares upon exercise of the Option, on and
after the following dates, in cumulative fashion:
(a) on the Date of Grant, up to one-tenth (ignoring fractional
shares) of the total number of ISOs; and
(b) on and after each of the first through tenth anniversaries
of the Date of Grant, up to an additional one-tenth (ignoring fractional shares)
of the total number of ISOs.
3. INSTALLMENT EXERCISE OF NQSOS. Subject to such further limitations
as are provided herein, the NQSOs granted hereunder shall become exercisable in
three (3) installments, the Grantee having the right hereunder to purchase from
Regent the following number of Option Shares upon exercise of the Option, on and
after the following dates, in cumulative fashion:
(a) on the first anniversary of the Date of Grant, up to
one-third (ignoring fractional shares) of the total number of NQSOs; and
(b) on and after each of the second and third anniversaries of
the Date of Grant, up to an additional one-third (ignoring fractional shares) of
the total number of NQSOs.
Notwithstanding the foregoing, upon sale, lease or transfer of substantially all
of the assets to any person other than a wholly-owned subsidiary, consummation
of a transaction which results in ownership of more than 50% of the voting stock
of Regent by a person or an entity not a beneficial owner as of the date of this
Grant, or such other occurrence as may reasonably may be considered a change of
control of Regent, all Option Shares shall become fully and immediately
exercisable, so long as they have not terminated in accordance with the terms of
the Plan or this Option Grant.
4. TERMINATION OF OPTION.
----------------------
(a) The Option and all rights hereunder with respect thereto,
to the extent such rights shall not have been exercised, shall terminate and
become null and void after the expiration of ten (10) years from the Date of
Grant (the "Option Term").
(b) Upon termination of the Grantee's employment, the Option
may be exercised during the following periods, but only to the extent that the
Option was outstanding and exercisable on any such date of termination: (i) the
one-year period following the date of such termination of the Grantee's
employment in the case of disability (within the meaning of Section 22(e)(3) of
the Code), (ii) the twelve-month period following the date of death, and (iii)
the three-month period following the date of any other termination or in the
case of disability other than as described in (i) above. In no event, however,
shall any such period extend beyond the Option Term.
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<PAGE> 3
(c) In the event of the death of the Grantee, the Option may
be exercised by the Grantee's legal representative(s), but only to the extent
that the Option would otherwise have been exercisable by the Grantee.
(d) A transfer of the Grantee's employment between Regent and
any subsidiary of Regent, or between any subsidiaries of Regent, shall not be
deemed to be a termination of the Grantee's employment.
5. EXERCISE OF OPTIONS.
--------------------
(a) The grantee may exercise the Option with respect to all or
any part of the number of Option Shares then exercisable hereunder by giving the
Secretary of Regent written notice of intent to exercise. The notice of exercise
shall specify the number of Option Shares as to which the Option is to be
exercised and the date of exercise thereof, which date shall be at least five
days after the giving of such notice unless an earlier time shall have been
mutually agreed upon.
(b) Full payment by the Grantee of the option price for the
Option Shares purchased shall be made on or before the exercise date specified
in the notice of exercise (1) in cash (in U.S. dollars), and/or (2) in whole or
in part through the surrender of previously acquired shares of Stock at their
fair market value on the exercise date.
(c) Option Shares shall be Incentive Stock Options to the
extent that the aggregate fair market value (determined as of the Grant Date)
exercisable for the first time by Grantee in any calendar year does not exceed
$100,000.
On the exercise date specified in the Grantee's notice or as soon
thereafter as is practicable, Regent shall cause to be delivered to the Grantee,
a certificate or certificates for the Option Shares then being purchased (out of
theretofore unissued Stock or reacquired Stock, as Regent may elect) upon full
payment for such Option Shares. The obligation of Regent to deliver Stock shall,
however, but subject to the condition that if at any time the Committee shall
determine in its discretion that the listing, registration or qualification of
the Option or the Option Shares upon any securities exchange or under any state
or federal law, or the consent or approval of any governmental regulatory body,
is necessary or desirable as a condition of, or in connection with, the Option
or issuance or purchase of Stock thereunder, the Option may not be exercised in
whole or in part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Committee.
6. ADJUSTMENT OF AND CHANGES IN STOCK OF REGENT. In the event of a
reorganization, recapitalization, change of shares, stock split, spinoff, stock
dividend, reclassification, subdivision or combination of shares, merger,
consolidation, rights offering, or any other change in the corporate structure
of Regent or in the shares of capital stock of Regent, the Committee shall make
such adjustments as appropriate in the number and/or kind of shares of stock
subject to the Option and/or in the option price; provided, however, that no
such adjustment shall give the Grantee any additional benefits under the Option.
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<PAGE> 4
7. FAIR MARKET VALUE. As used herein, the "fair market vale" of a share
of Stock shall be that amount determined in accordance with the provisions of
Section 6 of the Plan.
8. NO RIGHTS OF STOCKHOLDERS. Neither the Grantee nor any personal
representative shall be, or shall have any of the rights and privileges of, a
stockholder of Regent with respect to any shares of Stock purchasable or
issuable upon the exercise of the Option, in whole or in part, prior to the date
of exercise of the Option.
9. NON-TRANSFERABILITY OF OPTION. During the Grantee's lifetime, the
Option hereunder shall be exercisable only by the Grantee or any guardian or
legal representative of the Grantee, and the Option shall not be transferable
except, in case of the death of the Grantee, by will or the laws of descent and
distribution, nor shall the Option be subject to attachment, execution or other
similar process. In no event of (a) any attempt by the Grantee to alienate,
assign, pledge, hypothecate or otherwise dispose of the Option, except as
provided for herein, or (b) the levy of any attachment, execution or similar
process upon the rights or interest hereby conferred, Regent may terminate the
Option by notice to the Grantee and it shall thereupon become null and void.
10. EMPLOYMENT NOT AFFECTED. The granting of the Option nor its
exercise shall not be construed as granting to the Grantee any right with
respect to continuance of employment of the Employer.
11. AMENDMENT OF OPTION. The Option may be amended by the Board or the
Committee at any time (i) if the Board or the Committee determines, in its sole
discretion, that amendment is necessary or advisable in the light of any
addition to or change in the Internal Revenue Code of 1986, as amended, or in
the regulations issued thereunder, or any federal or state securities law or
other law or regulation, which change occurs after the Date of Grant and by its
terms applies to the Option; or (ii) other than in the circumstances described
in clause (i), with the consent of the Grantee.
12. NOTICE. Any notice to Regent provided for in this instrument shall
be addressed to it in care of its Secretary at its executive offices at 50
RiverCenter Boulevard, Covington, Kentucky 41011 and any notice to the Grantee
shall be addressed to the Grantee at the current address shown on the payroll
records of the Employer. Any notice shall be deemed to be duly given if and when
properly addressed and posted by registered or certified mail, postage prepaid.
13. INCORPORATION OF PLAN BY REFERENCE. The Option is granted pursuant
to the terms of the Plan, the terms of which are incorporated herein by
reference, and the Option shall in all respects be interpreted in accordance
with the Plan. The Committee shall interpret and construe the Plan and this
instrument, and its interpretations and determinations shall be conclusive and
binding on the parties hereto and any other person claiming an interest
hereunder, with respect to any issue arising hereunder or thereunder.
14. GOVERNING LAW. The validity, construction, interpretation and
effect of this instrument shall exclusively be governed by and determined in
accordance with the law of the
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<PAGE> 5
Commonwealth of Kentucky, except to the extent preempted by federal law, which
shall to the extent govern.
IN WITNESS WHEREOF, Regent has caused its duly authorized officers to
execute an attest this Grant of Incentive Stock Option and the Grantee has
placed his or her signature hereon, effective as of the Date of Grant.
WITNESS: REGENT COMMUNICATIONS, INC.
/s/ By: /s/
- ---------------------------- ------------------------------------
Its:
-----------------------------------
/s/
- ----------------------------
ACCEPTED AND AGREED TO:
/s/
- ----------------------------
Grantee
-5-
<PAGE> 1
EXHIBIT 4(j)
Regent Communications, Inc. 1998 Management Stock Option Plan
GRANT OF INCENTIVE STOCK OPTION
Date of Grant: June 15, 1998
THIS GRANT, dated as of the date of grant first stated above (the "Date
of Grant"), is delivered by Regent Communications, Inc., a Delaware corporation
("Regent") to William L. Stakelin (the "Grantee"), who is a key management
employee of Regent (sometimes referred to herein as the "Employer").
WHEREAS, the Board of Directors of Regent (the "Board") on February 16,
1998, adopted, with stockholder approval, the Regent Communications, Inc. 1998
Management Stock Option Plan (the "Plan");
WHEREAS, the Plan provides for the granting of Incentive Stock Options
("ISOs") and/or Non-Qualified Stock Options ("NQSOs") by a committee to be
appointed by the Board (the "Committee") to key management employees of Regent
or any subsidiary of Regent to purchase shares of the Common Stock of Regent
(the "Stock"), in accordance with the terms and provisions thereof; and
WHEREAS, the Committee considers the Grantee to be a person who is
eligible for a grant of stock options under the Plan, and has determined that it
would be in the best interest of Regent to grant the stock options documented
herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. GRANT OF OPTION. Subject to the terms and conditions hereinafter set
forth, Regent, with the approval and at the direction of the Committee, hereby
grants to the Grantee, as of the Date of Grant, an option to purchase up to
608,244 shares of Stock at a price of $5.00 per share, which amount is not less
than the fair market value of the Stock as of the Date of Grant. Such option is
hereinafter referred to as the "Option" and the shares of stock purchasable upon
exercise of the Option are hereinafter sometimes referred to as the "Option
Shares." To the greatest extent possible, the Option is intended by the parties
hereto to be, and shall be, treated as an Incentive Stock Option as such term is
defined under Section 422 of the Internal Revenue Code of 1986, as amended and
such Options shall be referred to herein as "ISOs." All Options which do not
qualify as ISOs shall be Non-Qualified Stock Options and shall be referred to
herein as "NQSOs."
<PAGE> 2
2. INSTALLMENT EXERCISE OF ISOS. Subject to such further limitations as
are provided herein, the ISOs granted hereunder shall become exercisable in ten
(10) installments, the Grantee having the right hereunder to purchase from
Regent the following number of Option Shares upon exercise of the Option, on and
after the following dates, in cumulative fashion:
(a) on the Date of Grant, up to one-tenth (ignoring fractional
shares) of the total number
of ISOs; and
(b) on and after each of the first through tenth anniversaries
of the Date of Grant, up to an additional one-tenth (ignoring fractional shares)
of the total number of ISOs.
3. INSTALLMENT EXERCISE OF NQSOS. Subject to such further limitations
as are provided herein, the NQSOs granted hereunder shall become exercisable in
three (3) installments, the Grantee having the right hereunder to purchase from
Regent the following number of Option Shares upon exercise of the Option, on and
after the following dates, in cumulative fashion:
(a) on the first anniversary of the Date of Grant, up to
one-third (ignoring fractional shares) of the total number of NQSOs; and
(b) on and after each of the second and third anniversaries of
the Date of Grant, up to an additional one-third (ignoring fractional shares) of
the total number of NQSOs.
Notwithstanding the foregoing, upon sale, lease or transfer of substantially all
of the assets to any person other than a wholly-owned subsidiary, consummation
of a transaction which results in ownership of more than 50% of the voting stock
of Regent by a person or an entity not a beneficial owner as of the date of this
Grant, or such other occurrence as may reasonably may be considered a change of
control of Regent, all Option Shares shall become fully and immediately
exercisable, so long as they have not terminated in accordance with the terms of
the Plan or this Option Grant.
4. TERMINATION OF OPTION.
----------------------
(a) The Option and all rights hereunder with respect thereto,
to the extent such rights shall not have been exercised, shall terminate and
become null and void after the expiration of ten (10) years from the Date of
Grant (the "Option Term").
(b) Upon termination of the Grantee's employment, the Option
may be exercised during the following periods, but only to the extent that the
Option was outstanding and exercisable on any such date of termination: (i) the
one-year period following the date of such termination of the Grantee's
employment in the case of disability (within the meaning of Section 22(e)(3) of
the Code), (ii) the twelve-month period following the date of death, and (iii)
the three-month period following the date of any other termination or in the
case of disability other than as described in (i) above. In no event, however,
shall any such period extend beyond the Option Term.
-2-
<PAGE> 3
(c) In the event of the death of the Grantee, the Option may
be exercised by the Grantee's legal representative(s), but only to the extent
that the Option would otherwise have been exercisable by the Grantee.
(d) A transfer of the Grantee's employment between Regent and
any subsidiary of Regent, or between any subsidiaries of Regent, shall not be
deemed to be a termination of the Grantee's employment.
5. EXERCISE OF OPTIONS.
--------------------
(a) The grantee may exercise the Option with respect to all or
any part of the number of Option Shares then exercisable hereunder by giving the
Secretary of Regent written notice of intent to exercise. The notice of exercise
shall specify the number of Option Shares as to which the Option is to be
exercised and the date of exercise thereof, which date shall be at least five
days after the giving of such notice unless an earlier time shall have been
mutually agreed upon.
(b) Full payment by the Grantee of the option price for the
Option Shares purchased shall be made on or before the exercise date specified
in the notice of exercise (1) in cash (in U.S. dollars), and/or (2) in whole or
in part through the surrender of previously acquired shares of Stock at their
fair market value on the exercise date.
(c) Option Shares shall be Incentive Stock Options to the
extent that the aggregate fair market value (determined as of the Grant Date)
exercisable for the first time by Grantee in any calendar year does not exceed
$100,000.
On the exercise date specified in the Grantee's notice or as soon
thereafter as is practicable, Regent shall cause to be delivered to the Grantee,
a certificate or certificates for the Option Shares then being purchased (out of
theretofore unissued Stock or reacquired Stock, as Regent may elect) upon full
payment for such Option Shares. The obligation of Regent to deliver Stock shall,
however, but subject to the condition that if at any time the Committee shall
determine in its discretion that the listing, registration or qualification of
the Option or the Option Shares upon any securities exchange or under any state
or federal law, or the consent or approval of any governmental regulatory body,
is necessary or desirable as a condition of, or in connection with, the Option
or issuance or purchase of Stock thereunder, the Option may not be exercised in
whole or in part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Committee.
6. ADJUSTMENT OF AND CHANGES IN STOCK OF REGENT. In the event of a
reorganization, recapitalization, change of shares, stock split, spinoff, stock
dividend, reclassification, subdivision or combination of shares, merger,
consolidation, rights offering, or any other change in the corporate structure
of Regent or in the shares of capital stock of Regent, the Committee shall make
such adjustments as appropriate in the number and/or kind of shares of stock
subject to the Option and/or in the option price; provided, however, that no
such adjustment shall give the Grantee any additional benefits under the Option.
-3-
<PAGE> 4
7. FAIR MARKET VALUE. As used herein, the "fair market vale" of a share
of Stock shall be that amount determined in accordance with the provisions of
Section 6 of the Plan.
8. NO RIGHTS OF STOCKHOLDERS. Neither the Grantee nor any personal
representative shall be, or shall have any of the rights and privileges of, a
stockholder of Regent with respect to any shares of Stock purchasable or
issuable upon the exercise of the Option, in whole or in part, prior to the date
of exercise of the Option.
9. NON-TRANSFERABILITY OF OPTION. During the Grantee's lifetime, the
Option hereunder shall be exercisable only by the Grantee or any guardian or
legal representative of the Grantee, and the Option shall not be transferable
except, in case of the death of the Grantee, by will or the laws of descent and
distribution, nor shall the Option be subject to attachment, execution or other
similar process. In no event of (a) any attempt by the Grantee to alienate,
assign, pledge, hypothecate or otherwise dispose of the Option, except as
provided for herein, or (b) the levy of any attachment, execution or similar
process upon the rights or interest hereby conferred, Regent may terminate the
Option by notice to the Grantee and it shall thereupon become null and void.
10. EMPLOYMENT NOT AFFECTED. The granting of the Option nor its
exercise shall not be construed as granting to the Grantee any right with
respect to continuance of employment of the Employer.
11. AMENDMENT OF OPTION. The Option may be amended by the Board or the
Committee at any time (i) if the Board or the Committee determines, in its sole
discretion, that amendment is necessary or advisable in the light of any
addition to or change in the Internal Revenue Code of 1986, as amended, or in
the regulations issued thereunder, or any federal or state securities law or
other law or regulation, which change occurs after the Date of Grant and by its
terms applies to the Option; or (ii) other than in the circumstances described
in clause (i), with the consent of the Grantee.
12. NOTICE. Any notice to Regent provided for in this instrument shall
be addressed to it in care of its Secretary at its executive offices at 50
RiverCenter Boulevard, Covington, Kentucky 41011 and any notice to the Grantee
shall be addressed to the Grantee at the current address shown on the payroll
records of the Employer. Any notice shall be deemed to be duly given if and when
properly addressed and posted by registered or certified mail, postage prepaid.
13. INCORPORATION OF PLAN BY REFERENCE. The Option is granted pursuant
to the terms of the Plan, the terms of which are incorporated herein by
reference, and the Option shall in all respects be interpreted in accordance
with the Plan. The Committee shall interpret and construe the Plan and this
instrument, and its interpretations and determinations shall be conclusive and
binding on the parties hereto and any other person claiming an interest
hereunder, with respect to any issue arising hereunder or thereunder.
14. GOVERNING LAW. The validity, construction, interpretation and
effect of this instrument shall exclusively be governed by and determined in
accordance with the law of the
-4-
<PAGE> 5
Commonwealth of Kentucky, except to the extent preempted by federal law, which
shall to the extent govern.
IN WITNESS WHEREOF, Regent has caused its duly authorized officers to
execute an attest this Grant of Incentive Stock Option and the Grantee has
placed his or her signature hereon, effective as of the Date of Grant.
WITNESS: REGENT COMMUNICATIONS, INC.
/s/ By: /s/
- ------------------------------- ---------------------------------
Its:
---------------------------------
/s/
- -------------------------------
ACCEPTED AND AGREED TO:
/s/
- -------------------------------
Grantee
-5-
<PAGE> 1
EXHIBIT 4(k)
THE WARRANT REPRESENTED BY THIS CERTIFICATE AND ANY SHARES THAT MAY BE ISSUED
UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED PURSUANT TO THE
SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAW. NEITHER THIS SECURITY NOR
ANY PORTION HEREOF OR INTEREST HEREIN MAY BE SOLD, ASSIGNED, PLEDGED OR
OTHERWISE DISPOSED OF UNLESS THE SAME IS REGISTERED UNDER SAID ACT AND ANY
APPLICABLE STATE SECURITIES LAW, OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION
IS AVAILABLE AND THE CORPORATION SHALL HAVE RECEIVED, AT THE EXPENSE OF THE
HOLDER HEREOF, EVIDENCE OF SUCH EXEMPTION REASONABLY SATISFACTORY TO THE
CORPORATION (WHICH MAY INCLUDE, AMONG OTHER THINGS, AN OPINION OF COUNSEL
SATISFACTORY TO THE CORPORATION).
REGENT COMMUNICATIONS, INC.
Warrant for the Purchase of 80,000 Shares of Common Stock
---------------------------------------------------------
June 15, 1998
FOR VALUE RECEIVED, REGENT COMMUNICATIONS, INC. (the "Corporation"), a
Delaware corporation, hereby certifies that RIVER CITIES CAPITAL FUND LIMITED
PARTNERSHIP, a Delaware limited partnership, or its assignee ("Holder") is
entitled to purchase from the Corporation from and after the date hereof and on
or before the fifth anniversary of the date hereof (the "Termination Date"),
80,000 fully paid and non-assessable shares of the Common Stock ("Common Stock")
of the Corporation at a price of $5.00 per share. Hereinafter, (i) said Common
Stock, together with any other equity securities which may be issued by the
Corporation in addition thereto or in substitution therefor, is referred to as
"Common Stock," (ii) the shares of Common Stock purchasable hereunder are
referred to as the "Warrant Shares," and (iii) the price payable hereunder for
each of the Warrant Shares is referred to as the "Per Share Warrant Price." The
Per Share Warrant Price is subject to adjustment as hereinafter provided.
1. EXERCISE OF WARRANT. Subject to the provisions of this Warrant, this
Warrant may be exercised by the Holder in whole or in part (but unless this
Warrant is being exercised in full, only for whole shares of Common Stock) at
any time or from time to time, but not later than 5:00 p.m. Eastern Standard
Time, on the Termination Date by presentation and surrender thereof at the
principal office of the Corporation with the subscription form at the end hereof
duly executed and accompanied by payment of the Per Share Warrant Price for the
number of shares specified in such form. Payment shall be in cash, certified
check or bank cashier's check payable to the order of the Corporation. If this
Warrant should be exercised in part only, the Corporation shall, upon surrender
of this Warrant for cancellation, execute and deliver a new Warrant evidencing
the right of the Holder (or its designee designated in the Assignment Form
annexed hereto) to purchase the balance of the shares purchasable hereunder.
Upon receipt by the Corporation of this Warrant, in proper form for exercise,
accompanied by payment of the Per Share Warrant Price for the number of shares
<PAGE> 2
specified in such form, the Holder shall be deemed to be the holder of record of
the shares of Common Stock issuable upon such exercise (effective as of the
close of business on such date), notwithstanding that the stock transfer books
of the Company shall then be closed or that certificates representing such
shares of Common Stock shall not then be actually delivered to the Holder.
2. RESERVATION OF WARRANT SHARES. The Corporation will at all times
reserve and keep available, solely for issuance or delivery upon the exercise of
this Warrant, the shares of Common Stock and Other Securities (as defined below)
receivable upon the exercise of this Warrant, free and clear of all restrictions
on sale or transfer and free and clear of all preemptive rights.
3. FULLY PAID STOCK; TAXES. The Corporation agrees that the shares of
Common Stock represented by each and every certificate for Warrant Shares or
Other Securities delivered on the exercise of this Warrant and payment of the
Per Share Warrant Price shall, at the time of such delivery, be validly issued
and outstanding, fully paid and non-assessable. The Corporation further
covenants and agrees that it will pay, when due and payable, all federal and
state stamp, original issue or similar taxes, if any, which are payable in
respect of the issue of this Warrant and/or any Warrant Share or certificates
therefor but excluding any federal, state or local taxes based on the income of
the Holder.
4. FRACTIONAL SHARES. No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of this Warrant. With
respect to any fraction of a share called for upon exercise of this Warrant in
full, the Company shall pay to the Holder (or its designee designated in the
Assignment Form annexed hereto) an amount in cash equal to the fair value of
such fractional share (determined in such manner as the Board of Directors of
the Corporation shall reasonably determine).
5. ADJUSTMENTS OF PER SHARE WARRANT PRICE. (a) If after the date hereof
shares of Common Stock are issued as a dividend or other distribution on Common
Stock, the Per Share Warrant Price in effect at the opening of business on the
business day next succeeding the date fixed for the determination of the
shareholders entitled to receive such dividend or other distribution shall be
decreased to the Per Share Warrant Price determined by multiplying said Per
Share Warrant Price so in effect by a fraction, the numerator of which shall be
the sum of the number of shares of Common Stock issued and outstanding and the
number of shares of Common Stock then issuable upon conversion of Preferred
Stock of Regent issued and outstanding (the "Conversion Shares"), all at the
close of business on the date fixed for such determination and the denominator
of which shall be the sum of said number of shares issued and outstanding
(including the Conversion Shares) at the close of business on the date fixed for
such determination and the number of shares constituting such dividend or other
distribution, such decrease becoming effective immediately after the opening of
business on the business day next succeeding the date fixed for such
determination.
(b) If after the date hereof outstanding shares of Common
Stock shall be subdivided into a greater number of shares or outstanding shares
shall be combined into a smaller number of shares, the per Share Warrant Price
in effect at the opening of business on the business day next succeeding the day
upon which such subdivision or combination becomes effective shall be decreased
or increased, as the case may be, to the Per Share Warrant price determined by
multiplying said Per Share Warrant Price so in effect by a fraction, the
numerator of which shall be the sum of the number of shares of Common Stock
issued and outstanding and the number of Conversion Shares, all immediately
before such subdivision or combination becomes effective and the denominator of
which shall be the number of such shares outstanding (including the Conversion
Shares) at the
-2-
<PAGE> 3
opening of business on the business day succeeding the day upon which such
subdivision or combination becomes effective.
(c) If after the date hereof the Corporation shall distribute
to all or substantially all holders of Common Stock either (i) evidences of
indebtedness or assets (excluding cash dividends or distributions) or (ii) any
other securities of the Corporation or any rights, warrants, options to
subscribe for, purchase or otherwise acquire securities of the Corporation (any
of which are referred to herein as "Other Securities"), then and in any such
case the Corporation shall either distribute such Other Securities to the Holder
of this Warrant or reserve for the benefit of the Holder of this Warrant, such
amount of such Other Securities as the Holder of this Warrant would have owned
or been entitled to receive immediately following such action had this Warrant
been exercised for shares of Common Stock prior thereto. In addition, the
Corporation shall either distribute to, or reserve for the benefit of, the
Holder of this Warrant any principal, interest, dividends or other property
payable with respect to such Other Securities as and when such interest,
dividends or other property is distributed to the holders of Common Stock. If
such a reserve is made, as and when this Warrant is exercised, the Holder shall
be entitled to receive from the Corporation such Holder's share of such Other
Securities together with the principal interest, dividends or other property
payable with respect thereto.
(d) Upon any adjustment of the Per Share Warrant Price, then,
and in each such case, the Corporation will promptly obtain a certificate of a
firm of independent public accountants of recognized standing selected by its
Board of Directors (who may be the regular auditors of the Corporation) setting
forth the adjusted Per Share Warrant Price and a brief statement of the facts
accounting for such adjustment and will cause a brief summary thereof to be
mailed to the Holder of this Warrant.
(e) In case of any reclassification of Common Stock of the
Corporation, other than a subdivision or combination of the outstanding Common
Stock, or of any consolidation or merger to which the Corporation or any
subsidiary of the Corporation is a party and for which approval of shareholders
of the Corporation is required or of the sale or transfer of all or
substantially all of the assets of the Corporation or of the voluntary or
involuntary dissolution, liquidation or winding up of the Corporation, the
Corporation shall cause to be mailed to the Holder of this Warrant, at least 20
days prior to the applicable date hereinafter specified, a notice stating the
date on which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up is expected to become effective, and the
date as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their shares for securities or other property deliverable
upon such reclassification consolidation, merger, sale, transfer, dissolution,
liquidation or winding up.
(f) If, on or prior to the Termination Date, the Corporation
shall consolidate with or merge into another corporation, or another corporation
shall merge into the Corporation in a merger in which shares of Common Stock are
converted into a right to receive cash, property or other securities, or the
Corporation shall sell or transfer all or substantially all of the assets of the
Corporation, the Corporation shall take such action so that the Holder of this
Warrant will thereafter receive upon the exercise hereof the securities or
property to which a holder of the number of shares of Common Stock then
deliverable upon the exercise of such Warrant would have been entitled to
receive upon such consolidation, merger, sale or transfer if such Warrant had
been exercised in full immediately prior to such transaction.
-3-
<PAGE> 4
(g) All calculations under this Section 5 shall be made to the
nearest one-hundredth of a cent or to the nearest one thousandth of a share, as
the case may be. No adjustment shall be required unless such adjustment would
result in an increase or decrease of at least one (1%) percent of the Per Share
Warrant Price; provided, however, that any adjustments which by reason of this
paragraph (g) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment.
(h) If at any time, as a result of an adjustment made pursuant
to paragraph (c) above, the Holder shall become entitled to purchase any Other
Securities, thereafter the number of such Other Securities purchasable upon
exercise of this Warrant and the price of the Other Securities shall be subject
to adjustment from time to time and in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to this Warrant
contained in paragraphs (a) through (g), inclusive above.
(i) Upon the expiration of any rights, options, warrants or
conversion of exchange privileges which caused an adjustment to the Per Share
Warrant Price to be made, if any thereof shall not have been exercised, the Per
Share Warrant Price shall, upon such expiration, be readjusted and shall
thereafter be such as it would have been had it been originally adjusted (or had
the original adjustment not been required, as the case may be) as if (i) the
only shares of Common Stock so issued were the shares of Common Stock, if any,
actually issued or sold upon the exercise of such rights, options, warrants or
conversion or exchange privileges and (ii) such shares of Common Stock, if any,
were issued or sold for the consideration actually received by the Corporation
upon such exercise plus the aggregate consideration, if any, actually received
by the Corporation for the issuance, sale or grant of all such rights, options,
warrants or conversion or exchange privileges, whether or not exercised;
provided further, that no such readjustment shall have the effect of decreasing
the Per Share Warrant Price by an amount in excess of the amount of the
adjustment initially made in respect to the issuance, sale or grant of such
rights, options, warrant, or conversion or exchange privileges.
(j) Upon any exercise of this Warrant at a time when there are
dividends or distributions declared but unpaid (whether as to Common Stock or
Other Securities or other property payable with respect hereto) and as to which
the dividend date or other date fixed for payment has passed, then, (i) to the
fullest extent permitted by law, such unpaid dividends or distributions shall be
paid by the Corporation contemporaneously with the exercise of this Warrant, and
(ii) to the extent payment of such unpaid dividends or distributions is not
legally permitted, then the Per Share Warrant Price shall be further adjusted by
increasing the number of shares of Common Stock or Other Securities or property
issuable upon conversion to take into account the value of such unpaid dividends
or other distributions in determining the amount of Common Stock or Other
Securities to be issued upon exercise of this Warrant.
6. LIMITED TRANSFERABILITY. (a) This Warrant and the Warrant Shares
have not been registered under the Securities Act of 1933 and may be transferred
only pursuant to an effective registration thereunder or an exemption from
registration thereunder and in compliance with applicable state securities laws.
This Warrant may not be transferred if such transfer would require any
registration or qualification under, or cause the loss of exemption from
registration or qualification under, such Act or any applicable state securities
law with respect to the Warrants or the Warrant Shares. This Warrant and any
Warrant Shares shall bear an appropriate legend with respect to such
restrictions on transfer. This Warrant is transferable only upon the books which
the Corporation shall cause to be maintained for such purpose. Any assignment or
transfer may be made
-4-
<PAGE> 5
by surrendering this Warrant to the Corporation together with the attached
assignment form properly executed by the assignor or transferor. Upon such
surrender the Corporation will execute and deliver, in the case of an assignment
or transfer in whole, a new Warrant in the name of the assignee or transferee
or, in the case of an assignment or transfer in part, a new Warrant in the name
of the assignee or transferee named in such instrument of assignment or transfer
and a new Warrant in the name of the assignor or transferor covering the number
of Warrant Shares in respect of which this Warrant shall not be assigned or
transferred to the assignee or transferee.
(b) The Corporation may treat the registered holder of this
Warrant as it appears on its books any time as the Holder and the owner of this
Warrant for all purposes. The Corporation shall permit the Holder of this
Warrant or his duly authorized attorney, upon written request during ordinary
business hours, to inspect and copy or make extracts from its books showing the
Holders of Warrants. All Warrants will be dated the same date as this Warrant.
7. LOSS, ETC. OF WARRANT. Upon receipt of evidence satisfactory to the
Corporation of the loss, theft, destruction or mutilation of this Warrant, and
of indemnity in form and amount reasonably satisfactory to the Corporation, if
lost, stolen or destroyed, and upon surrender and cancellation of this Warrant,
if mutilated, and upon reimbursement of the Corporation's reasonable incidental
expenses, the Corporation shall execute and deliver to the Holder new Warrant of
like date, tenor and denomination.
8. WARRANT HOLDER NOT A SHAREHOLDER. This Warrant does not confer upon
the Holder any right to vote or to consent or to receive notice as a shareholder
of the Corporation, as such, in respect of any matters whatsoever, or any other
rights or liabilities as a shareholder, prior to the exercise hereof.
9. COMMUNICATION. No notice or other communication under this Warrant
shall be effective unless, but any notice or other communication shall be
effective and shall be deemed to have been given if, the same is in writing and
is mailed by first-class mail, postage prepaid, addressed to:
(a) the Corporation at 50 East RiverCenter Blvd., Suite 180,
Covington, KY 41011, or such other address as the Corporation has designated in
writing to the Holder, or
(b) the Holder at the address shown on the Corporation's books
as described above.
10. HEADINGS. The headings of this Warrant have been inserted as a
matter of convenience, and shall not affect the construction hereof.
11. AMENDMENTS. This Warrant may be amended only by written agreement
of the Corporation and the Holder.
12. APPLICABLE LAW. This Warrant shall be governed by and construed in
accordance with the laws of the State of Delaware applicable to agreements made
and to be performed therein.
-5-
<PAGE> 6
IN WITNESS THEREOF, REGENT COMMUNICATIONS, INC. has executed this
Warrant as of the date set forth on the first page hereof.
REGENT COMMUNICATIONS, INC.
By: William L. Stakelin
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President
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SUBSCRIPTION
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The undersigned, ___________________________, pursuant to the
provisions of the foregoing Warrant, hereby agrees to subscribe for and purchase
___________ shares of Common Stock of REGENT COMMUNICATIONS, INC. covered by
said Warrant, and makes payment therefor in full at the price per share provided
by said Warrant.
Dated: Signature:
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Address:
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ASSIGNMENT
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FOR VALUE RECEIVED hereby sells, assigns and transfers unto the
foregoing Warrant and all rights evidenced thereby, and does irrevocably
constitute and appoint ________________________________, attorney, to transfer
said Warrant on the books of REGENT COMMUNICATIONS, INC. ___________________
hereby agrees to be bound by the terms of the Warrant as defined therein.
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