-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QDEKV4HK6y8nL+zYcfEsKdDG4AtTunldyD9YbAJmLxf4JDin1EcB9dAcNyW6QTgl M9ASXqDVAVIZ7T0QmYfjbw== 0000912057-96-011126.txt : 19960531 0000912057-96-011126.hdr.sgml : 19960531 ACCESSION NUMBER: 0000912057-96-011126 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19960530 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: JACOR COMMUNICATIONS INC CENTRAL INDEX KEY: 0000702808 STANDARD INDUSTRIAL CLASSIFICATION: RADIO BROADCASTING STATIONS [4832] IRS NUMBER: 310978313 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-02495 FILM NUMBER: 96574532 BUSINESS ADDRESS: STREET 1: 1300 PNC CENTER STREET 2: 201 E FIFTH ST CITY: CINCINNATI STATE: OH ZIP: 45202 BUSINESS PHONE: 5136211300 S-3/A 1 S-3/A AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 30, 1996 REGISTRATION NO. 333-02495 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------------- AMENDMENT NO. 2 TO FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------ JACOR COMMUNICATIONS, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) ------------------------------ OHIO 31-0978313 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
1300 PNC CENTER 201 EAST FIFTH STREET CINCINNATI, OHIO 45202 (513) 621-1300 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) ------------------------------ R. CHRISTOPHER WEBER JACOR COMMUNICATIONS, INC. 1300 PNC CENTER 201 EAST FIFTH STREET CINCINNATI, OHIO 45202 (513) 621-1300 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) ------------------------------ COPIES OF COMMUNICATIONS TO: RICHARD G. SCHMALZL, ESQ. GREGG A. NOEL, ESQ. GRAYDON, HEAD & RITCHEY SKADDEN, ARPS, SLATE, MEAGHER & FLOM 1900 FIFTH THIRD CENTER 300 SOUTH GRAND AVENUE, SUITE 3400 CINCINNATI, OHIO 45202 LOS ANGELES, CALIFORNIA 90071 (513) 621-6464 (213) 687-5000
-------------------------- APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after this Registration Statement becomes effective. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. / / If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. / / If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / / If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / / If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. / / -------------------------- THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. The prospectus contained in this Registration Statement also relates to a registration statement previously filed with the Commission. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SIGNATURES PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THE REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS AMENDMENT NO. 2 TO REGISTRATION STATEMENT NO. 333-02495 TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED IN THE CITY OF CINCINNATI, STATE OF OHIO ON THIS 30TH DAY OF MAY 1996. JACOR COMMUNICATIONS, INC. BY: /s/ JON M. BERRY ----------------------------------- Jon M. Berry SENIOR VICE PRESIDENT AND TREASURER PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THIS AMENDMENT NO. 2 TO REGISTRATION STATEMENT NO. 333-02495 HAS BEEN SIGNED ON MAY 30, 1996 BY THE FOLLOWING PERSONS IN THE CAPACITIES INDICATED. Principal Executive Officer: Principal Financial and Accounting Officer: /s/ RANDY /s/ R. CHRISTOPHER WEBER* MICHAELS* - ----------------------------------- ----------------------------------- Randy Michaels R. Christopher Weber PRESIDENT, CO-CHIEF OPERATING SENIOR VICE PRESIDENT, CHIEF OFFICER AND DIRECTOR FINANCIAL OFFICER AND SECRETARY /s/ ROBERT L. /s/ ROD F. DAMMEYER* LAWRENCE* - ----------------------------------- ----------------------------------- Robert L. Lawrence Rod F. Dammeyer CO-CHIEF OPERATING OFFICER AND DIRECTOR DIRECTOR /s/ SHELI Z. /s/ F. PHILIP HANDY* ROSENBERG* - ----------------------------------- ----------------------------------- Sheli Z. Rosenberg F. Philip Handy BOARD CHAIR AND DIRECTOR DIRECTOR /s/ JOHN W. /s/ MARC LASRY* ALEXANDER* - ----------------------------------- ----------------------------------- John W. Alexander Marc Lasry DIRECTOR DIRECTOR *By: Jon M. Berry as attorney-in-fact, pursuant to a power of attorney previously filed. II-3 INDEX TO EXHIBITS
SEQUENTIALLY EXHIBIT NUMBERED NUMBER DESCRIPTION OF EXHIBIT PAGE - ---------- --------------------------------------------------------------------------- --------- 1.1 Form of Purchase Agreement. 2.1 Agreement and Plan of Merger dated February 12, 1996 (the "Merger * Agreement") among Citicasters Inc., the Registrant and JCAC, Inc. Incorporated by reference to Exhibit 2.1 to the Registrant's Current Report on Form 8-K dated February 27, 1996. 2.2 Stockholders Agreement dated February 12, 1996 among the Registrant, JCAC, * Inc., Great American Insurance Company, American Financial Corporation, American Financial Enterprises, Inc., Carl H. Lindner, The Carl H. Lindner Foundation and S. Craig Lindner. Incorporated by reference to Exhibit 2.2 to the Registrant's Current Report on Form 8-K dated February 27, 1996. 2.3 Jacor Shareholders Agreement dated February 12, 1996 among Citicasters Inc. * and Zell/ Chilmark Fund L.P. Incorporated by reference to Exhibit 2.3 to the Registrant's Current Report on Form 8-K dated February 27, 1996. 2.4 Escrow Agreement among the Registrant, Citicasters Inc. and PNC Bank dated * March 13, 1996. Incorporated by reference to Exhibit 2.4 to the Registrant's Registration Statement on Form S-3 (File No. 333-01917). 2.5 Irrevocable Letter of Credit, Banque Paribas, Chicago Branch dated March * 13, 1996. Incorporated by reference to Exhibit 2.4 to the Registrant's Registration Statement on Form S-3 (File No. 333-01917). 2.6 Letter of Credit and Reimbursement Agreement by and between the Registrant * and Banque Paribas dated March 13, 1996. Incorporated by reference to Exhibit 2.4 to the Registrant's Registration Statement on Form S-3 (File No. 333-01917). 2.7 Form of Employment Continuation Agreement (executive officer form) between * Citicasters Inc. and [executive officer] (referred to as exhibit 6.6(c)(i) in Merger Agreement). Incorporated by reference to Exhibit 2.5 to the Registrant's Current Report on Form 8-K dated February 27, 1996. 2.8 Form of Employment Continuation Agreement (management form) between * Citicasters Inc. and [manager] (referred to as exhibit 6.6(c)(ii) in Merger Agreement). Incorporated by reference to Exhibit 2.6 to the Registrant's Current Report on Form 8-K dated February 27, 1996. 2.9 Form of Warrant Agreement between the Registrant, and KeyCorp Shareholder * Services, Inc., as warrant agent (referred to as exhibit 3.1 in Merger Agreement). Incorporated by reference to Exhibit 2.7 to the Registrant's Current Report on Form 8-K dated February 27, 1996. 2.10 Stock Purchase and Stock Warrant Redemption Agreement dated as of February * 20, 1996 among the Registrant, Prudential Venture Partners II, L.P., Northeast Ventures, II, John T. Lynch, Frank A. DeFrancesco, Thomas R. Jiminez, William R. Arbenz, CIHC, Incorporated, Bankers Life Holding Corporation and Noble Broadcast Group, Inc. ("Noble") (omitting exhibits not deemed material or filed separately in executed form). [Prudential and Northeast are sometimes referred to hereafter as the "Class A Shareholders"; Lynch, DeFrancesco, Jiminez and Arbenz as the "Class B Shareholders"; and CIHC and Bankers Life as the Warrant Sellers.] Incorporated by reference to Exhibit 2.1 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 2.11 Investment Agreement dated as of February 20, 1996 among the Registrant, * Noble and the Class B Shareholders (omitting exhibits not deemed material). Incorporated by reference to Exhibit 2.2 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended.
SEQUENTIALLY EXHIBIT NUMBERED NUMBER DESCRIPTION OF EXHIBIT PAGE - ---------- --------------------------------------------------------------------------- --------- 2.12 Warrant to Purchase Class A Common Stock of Noble issued to the Registrant. * Incorporated by reference to Exhibit 2.3 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 2.13 Indemnification and Escrow Agreement dated as of February 20, 1996 among * the Registrant, Noble, the Class A Shareholders, the Class B Shareholders, the Warrant Sellers, The Fifth Third Bank and Conseco, Inc. Incorporated by reference to Exhibit 2.4 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 2.14 Stock Escrow and Security Agreement dated as of February 20, 1996 among the * Registrant, Noble, the Class B Shareholders, Philip H. Banks, as trustee, and The Fifth Third Bank, as escrow agent (omitting exhibits not deemed material or filed separately in executed form). Incorporated by reference to Exhibit 2.5 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 2.15 Trust Agreement dated as of February 20, 1996 among the Class B * Shareholders and their spouses, and Philip H. Banks, as trustee. Incorporated by reference to Exhibit 2.6 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 2.16 Registration Rights Agreement dated as of February 20, 1996 between the * Registrant and Noble. Incorporated by reference to Exhibit 2.7 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 2.17 Asset Purchase Agreement dated as of February 20, 1996 among Chesapeake * Securities, Inc. (a Registrant subsidiary), Noble Broadcast of San Diego, Inc., Sports Radio, Inc. and Noble Broadcast Center, Inc. Incorporated by reference to Exhibit 2.7 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 2.18 Jacor--CMM Limited Partnership Agreement of Limited Partnership dated * January 1, 1994, by and between Jacor Cable, Inc., Up Your Ratings, Inc. and the Registrant. Incorporated by reference to Exhibit 2.2 of the Registrant's Annual Report on Form 10-K dated March 30, 1995. 2.19 Amendment No. 1 to Jacor--CMM Limited Partnership Agreement of Limited * Partnership dated July 22, 1994, by and between Jacor Cable, Inc., Up Your Ratings, Inc. and the Registrant to amend the Jacor-CMM Limited Partnership Agreement of Limited Partnership dated January 1, 1994. Incorporated by reference to Exhibit 2.3 of the Registrant's Annual Report on Form 10-K dated March 30, 1995. 2.20 Amendment No. 2 to Jacor--CMM Limited Partnership Agreement of Limited * Partnership with an effective date as of January 1, 1994, by and between Jacor Cable, Inc., Up Your Ratings, Inc. and the Registrant to amend the Jacor--CMM Limited Partnership Agreement of Limited Partnership dated January 1, 1994. Incorporated by reference to Exhibit 2.4 of the Registrant's Annual Report on Form 10-K dated March 30, 1995. 4.1 Specimen Common Stock Certificate. Incorporated by reference to Exhibit 2.1 * to the Registrant's Form 8-A, dated January 12, 1993. 4.2 Credit Agreement dated as of February 20, 1996, among the Registrant, the * Banks named therein, Banque Paribas, as Agent, and The First National Bank of Boston and Bank of America Illinois, as Co-Agents (omitting exhibits not deemed material or filed separately in executed form). Incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.3 Revolving A Note in favor of Banque Paribas by the Registrant dated as of * February 20, 1996. (1) Incorporated by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended.
SEQUENTIALLY EXHIBIT NUMBERED NUMBER DESCRIPTION OF EXHIBIT PAGE - ---------- --------------------------------------------------------------------------- --------- 4.4 Revolving B Note in favor of Banque Paribas by the Registrant dated as of * February 20, 1996. (1) Incorporated by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.5 Security Agreement dated as of February 20, 1996 among the Registrant, * Banque Paribas, as Agent, for itself, the Co-Agents and the Banks. Incorporated by reference to Exhibit 4.4 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.6 Pledge Agreement dated as of February 20, 1996 among the Registrant, Banque * Paribas, as Agent, for itself, the Co-Agents and the Banks. Incorporated by reference to Exhibit 4.5 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.7 Trademark Security Agreement dated as of February 20, 1996 among the * Registrant, Banque Paribas, as Agent, for itself, the Co-Agents and the Banks. Incorporated by reference to Exhibit 4.6 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.8 Subsidiary Guaranty dated as of February 20, 1996, by various subsidiaries * of the Registrant in favor of Banque Paribas, as Agent, for itself, the Co-Agents and the Banks. (2) Incorporated by reference to Exhibit 4.7 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.9 Subsidiary Security Agreement dated as of February 20, 1996, by various * Company subsidiaries in favor of Banque Paribas, as Agent, for itself, the Co-Agents and the Banks (omitting exhibits not deemed material). (2) Incorporated by reference to Exhibit 4.8 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.10 Primary Pledge Agreement dated as of February 20, 1996 among Chesapeake * Securities, Inc. (a subsidiary of the Registrant), Banque Paribas as Agent, for itself, the Co-Agents and the Banks. (3) Incorporated by reference to Exhibit 4.9 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.11 Secondary Pledge Agreement dated as of February 20, 1996 between the * Registrant and Chesapeake Securities, Inc. (a subsidiary of the Registrant). (4) Incorporated by reference to Exhibit 4.10 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.12 Subsidiary Trademark Agreement dated as of February 20, 1996 among Jacor * Broadcasting of Tampa Bay, Inc., Jacor Broadcasting of Atlanta, Inc., Jacor Broadcasting Corporation and Jacor Broadcasting of Florida, Inc. in favor of Banque Paribas as Agent, for itself, the Co-Agents and the Banks. Incorporated by reference to Exhibit 4.11 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.13 Deed to Secure Debt and Security Agreement, dated as of February 20, 1996, * by and between Jacor Broadcasting of Atlanta, Inc. and Banque Paribas, as Agent. Incorporated by reference to Exhibit 4.12 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.14 Deed of Trust and Security Agreement, dated as of February 20, 1996, * between Jacor Broadcasting of Colorado, Inc. and the Public Trustee in the County of Weld and the State of Colorado. (6) Incorporated by reference to Exhibit 4.13 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.15 Open-End Mortgage, Assignment of Rents and Leases and Security Agreement, * dated February 20, 1996, by and between Jacor Broadcasting Corporation and Banque Paribas, as Agent. (7) Incorporated by reference to Exhibit 4.14 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended.
SEQUENTIALLY EXHIBIT NUMBERED NUMBER DESCRIPTION OF EXHIBIT PAGE - ---------- --------------------------------------------------------------------------- --------- 4.16 Open-End Mortgage, Assignment of Rents and Leases and Security Agreement * dated as of February 20, 1996, by Jacor Broadcasting of Tampa Bay, Inc. in favor of Banque Paribas, as Agent. (8) Incorporated by reference to Exhibit 4.15 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.17 Deed of Trust and Security Agreement, Assignment of Leases, Rents and * Profits, Financing Statement and Fixture Filing made by Chesapeake Securities, Inc. for the Benefit of Banque Paribas as Agent dated as of February 20, 1996. Incorporated by reference to Exhibit 4.16 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.18 Second Consolidated Amended and Restated Intercompany Demand Note issued to * the Company by various subsidiaries of the Registrant dated as of February 20, 1996. (5) Incorporated by reference to Exhibit 4.17 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.19 Second Amended and Restated Intercompany Security Agreement and Financing * Statement dated as of February 20, 1996 by various subsidiaries of the Registrant in favor of the Company (omitting exhibits not deemed material). (2) Incorporated by reference to Exhibit 4.18 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 4.20(+) Restricted Stock Agreement dated as of June 23, 1993 by and between the * Registrant and Rod F. Dammeyer. (9) Incorporated by reference to Exhibit 4.2 to the Registrant's Quarterly Report on Form 10-Q dated August 13, 1993. 4.21(+) Stock Option Agreement dated as of June 23, 1993 between the Registrant and * Rod F. Dammeyer covering 10,000 shares of the Registrant's common stock. (10) Incorporated by reference to Exhibit 4.3 to the Registrant's Quarterly Report on Form 10-Q dated August 13, 1993. 4.22(+) Stock Option Agreement dated as of December 15, 1994 between the Registrant * and Rod F. Dammeyer covering 5,000 shares of the Registrant's common stock. (11) Incorporated by reference to Exhibit 4.23 to the Registrant's Quarterly Report on Form 10-Q dated August 13, 1993. 4.23 Form of Indenture for the LYONs. 5.1 Form of Opinion of Graydon, Head & Ritchey. 8.1 Form of Tax Opinion of Graydon, Head & Ritchey (to be filed by amendment). ** 10.1 Credit Agreement dated as of February 20, 1996 among Broadcast Finance, Inc. (a Regis-trant subsidiary), Noble Broadcast Group, Inc. and Noble Broadcast Holdings, Inc. (omitting exhibits not deemed material or filed separately in executed form). Incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 10.2 Subsidiary Guaranty dated as of February 20, 1996 in favor of Broadcast * Finance, Inc. by Noble Broadcast Center, Inc., Noble Broadcast of Colorado, Inc., Noble Broadcast of St. Louis, Inc., Noble Broadcast of Toledo, Inc., Nova Marketing Group, Inc., Noble Broadcast Licenses, Inc., Noble Broadcast of San Diego, Inc., Sports Radio, Inc. and Sports Radio Broadcasting, Inc. Incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 10.3 Term Note in the amount of $40,000,000 by Noble Broadcast Holdings, Inc. in * favor of Broadcast Finance, Inc. dated as of February 20, 1996. Incorporated by reference to Exhibit 10.3 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended.
SEQUENTIALLY EXHIBIT NUMBERED NUMBER DESCRIPTION OF EXHIBIT PAGE - ---------- --------------------------------------------------------------------------- --------- 10.4 Revolving Note in the amount of $1,000,000 by Noble Broadcast Holdings, * Inc. in favor of Broadcast Finance, Inc. dated as of February 20, 1996. Incorporated by reference to Exhibit 10.4 to the Registrant's Current Report on Form 8-K dated March 6, 1996, as amended. 10.5(+) Jacor Communications, Inc. 1993 Stock Option Plan. Incorporated by * reference to Exhibit 99 to the Quarterly Report on Form 10-Q dated August 13, 1993. 10.6(+) Jacor Communications, Inc. 1995 Employee Stock Purchase Plan. Incorporated * by reference to Exhibit 4.01 to the Registration Statement on Form S-8, filed on November 9, 1994. 12 Computation of Ratio of Earnings to Fixed Charges. *** 23.1 Consent of Coopers & Lybrand L.L.P. *** 23.2 Consent of Ernst & Young LLP. *** 23.3 Consent of Price Waterhouse LLP. *** 23.4 Consent of Graydon, Head & Ritchey (included in opinion of counsel filed as Exhibit 5.1). 24 Powers of Attorney. *** 25 Statement of Eligibility of the Bank of New York as Trustee. *** 27.1 Financial Data Schedule of the Registrant. Incorporated by reference to the * Registrant's Annual Report on Form 10-K for the year ended December 31, 1995, as amended.
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(*) Incorporated by reference. (**) To be filed by Amendment. (***) Previously filed. (+) Management Contracts and Compensatory Arrangements. (1) Identical Notes were issued by the Company in favor of the following Banks: The First National Bank of Boston Bank of America Illinois Bank of Montreal The Bank of New York The Bank of Nova Scotia CIBC, Inc. First Bank Society National Bank Union Bank The aggregate principal amount of Revolving A Notes is $190 million. The aggregate principal amount of the Revolving B Notes is $110 million. (2) Executed by the following subsidiaries of the Registrant: Jacor Broadcasting of Florida, Inc. Jacor Broadcasting of Atlanta, Inc. Jacor Broadcasting of Knoxville, Inc. Jacor Broadcasting of Colorado, Inc. Jacor Broadcasting of Tampa Bay, Inc. Jacor Broadcasting of St. Louis, Inc. Jacor Cable, Inc. Georgia Network Equipment, Inc. Jacor Broadcasting Corporation Broadcast Finance, Inc. Chesapeake Securities, Inc. OIA Broadcasting L.L.C. (3) An identical Primary Pledge Agreement was executed by Jacor Broadcasting of Atlanta, Inc.
(4) An identical Secondary Pledge Agreement was executed by Jacor Broadcasting of Atlanta, Inc. (5) Such notes were issued by the subsidiaries of the Registrant identified in (2) above. (6) A substantially similar document was entered into by Jacor Broadcasting of Colorado, Inc. relating to real property located in Douglas County, Colorado. (7) A substantially similar document was entered into by Jacor Broadcasting Corporation relating to real property located in Hamilton County, Ohio. (8) Substantially similar documents were entered into by Jacor of Tampa Bay, Inc. relating to real property located in Manatee County, Florida and by Jacor Broadcasting of Florida relating to real property located in Duval County, Florida and St. Johns County, Florida. (9) Substantially identical documents were entered into with John W. Alexander, F. Philip Handy and Marc Lasry covering 20,000, 30,000 and 10,000 shares of common stock, respectively. (10) Identical documents were entered into with John W. Alexander, F. Philip Handy and Marc Lasry. (11) Identical documents were entered into with John W. Alexander, F. Philip Handy, Marc Lasry and Sheli Z. Rosenberg.
EX-1.1 2 EXHIBIT 1.1 JACOR COMMUNICATIONS, INC. (an Ohio corporation) $225,000,000 Principal Amount At Maturity Liquid Yield Option-TM- Notes Due 2011 (Zero Coupon - Subordinated) PURCHASE AGREEMENT [ ], 1996 MERRILL LYNCH & CO. Merrill Lynch, Pierce, Fenner & Smith Incorporated Merrill Lynch World Headquarters North Tower World Financial Center New York, New York 10281-1305 Dear Sirs: Jacor Communications, Inc., an Ohio corporation (the "Company"), confirms its agreement with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated (the "Underwriter"), with respect to the sale by the Company and the purchase by the Underwriter of $225,000,000 aggregate principal amount at maturity of its Liquid Yield Option-TM- Notes due 2011 (the "LYONs-TM-") and with respect to the grant by the Company to the Underwriter of the option described in Section 2 hereof to purchase all or any part of an additional $33,750,000 aggregate principal amount at maturity of its LYONs solely to cover over-allotments. The aforesaid aggregate principal amount at maturity of LYONs (the "Initial Securities") and all or any part of the $33,750,000 aggregate principal amount at maturity of the LYONs subject to the over-allotment option described in Section 2 hereof (the "Option Securities") are collectively _______________ - -TM- Trademark of Merrill Lynch & Co., Inc. referred to herein as the "Securities." The Securities are to be issued pursuant to an indenture, to be dated as of __________, 1996, as it may be amended or supplemented from time to time (the "Indenture"), between the Company and The Bank of New York, as trustee (the "Trustee"). The Securities are convertible into shares of common stock, no par value per share, of the Company (the "Common Stock"), at any time before the close of business on the maturity date of the Securities. On __________, 2001 and __________, 2006, the holders of the Securities each have the option to require the Company to purchase such Securities by paying the issue price of the Securities plus the accrued original issue discount to the date of purchase, such payment to be made, at the option of the Company, in cash, in shares of Common Stock or any combination thereof. Prior to the purchase and public offering of the Securities by the Underwriter, the Company and the Underwriter shall enter into an agreement substantially in the form of Exhibit A hereto (the "Pricing Agreement"). The Pricing Agreement may take the form of an exchange of any standard form of written telecommunication between the Company and the Underwriter and shall specify such applicable information as is indicated in Exhibit A hereto. The offering of the Securities will be governed by this Agreement, as supplemented by the Pricing Agreement. From and after the date of the execution and delivery of the Pricing Agreement, this Agreement shall be deemed to incorporate the Pricing Agreement. The Company has filed with the Securities and Exchange Commission (the "Commission") a registration statement on Form S-3 (No. 333-02495) and a related preliminary prospectus for the registration of the offering of Securities including the Common Stock issuable upon conversion thereof under the Securities Act of 1933, as amended (the "1933 Act"), has filed such amendments thereto, if any, and such amended preliminary prospectuses as may have been required to the date hereof, and will file such additional amendments thereto and such amended prospectuses as may hereafter be required. Such registration statement (as amended, if applicable) and the prospectus constituting a part thereof (including in each case all documents, if any, incorporated by reference therein and the information, if any, deemed to be part 2 thereof pursuant to Rule 430A(b) of the rules and regulations of the Commission under the 1933 Act (the "1933 Act Regulations")), as from time to time amended or supplemented pursuant to the 1933 Act, are hereinafter referred to as the "Registration Statement" and the "Prospectus," respectively, except that if any revised prospectus shall be provided to the Underwriter by the Company for use in connection with the offering of the Securities including the Common Stock issuable upon conversion thereof which differs from the Prospectus on file at the Commission at the time the Registration Statement becomes effective (whether or not such revised prospectus is required to be filed by the Company pursuant to Rule 424(b) of the 1933 Act Regulations), the term "Prospectus" shall refer to such revised prospectus from and after the time it is first provided to the Underwriter for such use. The Company understands that the Underwriter proposes to make a public offering of the Securities as soon as the Underwriter deems advisable after the Registration Statement becomes effective, the Pricing Agreement has been executed and delivered and the Indenture has been qualified under the Trust Indenture Act of 1939, as amended (the "1939 Act"). The Securities are being issued and sold in connection with (i) the merger (the "Merger") of Citicasters Inc., a Florida corporation ("Citicasters"), with and into a wholly owned subsidiary of the Company, and (ii) the acquisition of all of the equity interests of Noble Broadcasting Group, Inc., a Delaware corporation ("Noble"), by the Company (the "Noble Acquisition" and collectively, with the Merger, the "Pending Acquisitions"). The Merger is being effected pursuant to an Agreement and Plan of Merger, dated as of February 12, 1996 (the "Merger Agreement"), by and among the Company, JCAC, Inc., a Florida corporation and a wholly owned subsidiary of the Company (the "Merger Sub"), and Citicasters. Pursuant to the Merger Agreement, the Company will acquire all of the issued and outstanding capital stock of Citicasters. The Noble Acquisition is being effected pursuant to the Stock Purchase and Stock Warrant Redemption Agreement dated as of February 20, 1996 by and among the 3 Company, Prudential Venture Partners II, L.P., Northeast Ventures, II, John T. Lynch, Frank A. DeFrancesco, Thomas R. Jiminez, William R. Arbenz, CIHC, Incorporated, Bankers Life Holding Corporation and Noble (the "Noble Acquisition Agreement"). Pursuant to the Noble Acquisition Agreement, the Company will acquire all of the issued and outstanding equity interests of Noble. Prior to or concurrently with the issuance and sale of the Securities, the Company will (i) enter into a new credit facility with availability of $600,000,000 with Chemical Bank, as administrative agent, Banque Paribas, as documentation agent, Bank of America, Illinois, as syndication agent and certain lenders named therein (together with the documents and agreements contemplated thereby, the "New Credit Facility"); (ii) issue and sell 11,250,00 Securities of Common Stock, no par value per share, of the Company (the"Common Stock") (excluding 1,687,500 shares of Common Stock which is subject to an over- allotment option) and (iii) issue and sell $100.0 million aggregate principal amount of ___% Senior Subordinated Notes due __________, 2006 (the "Sub Notes"). This Underwriting Agreement, the Indenture, the Merger Agreement and all related agreements and documents, the Noble Acquisition Agreement and all related agreements and documents, the New Credit Facility and all related agreements and documents, and all documents and agreements related to each of the Common Stock offering and the Sub Notes offering are collectively referred to herein as the "Transaction Documents." SECTION 1. REPRESENTATIONS AND WARRANTIES. The Company represents and warrants to the Underwriter as of the date hereof and as of the date of the Pricing Agreement (such latter date being hereinafter referred to as the "Representation Date") as follows: (a) When the Registration Statement becomes effective, including at the date of any post-effective amendment, at the date of the Prospectus (if different) and at the Closing Date, the Registration Statement will comply in all material respects with the provisions of the Act, and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements 4 therein not misleading; the Prospectus and any supplements or amendments thereto will not at the date of the Prospectus, at the date of any such supplements or amendments and at the Closing Date contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties contained in this paragraph (a) shall not apply to statements in or omissions from the Registration Statement or the Prospectus (or any supplement or amendment to them) made in reliance upon and in conformity with information relating to the Underwriter furnished to the Company in writing by or on behalf of the Underwriter expressly for use therein. The Company acknowledges for all purposes under this Agreement that the statements with respect to price and underwriting discount and the last paragraph all as set forth on the cover page and in the second and third sentences of the first paragraph under the caption "Underwriting" in the Prospectus (or any amendment or supplement) constitute the only written information furnished to the Company by the Underwriter expressly for use in the Registration Statement or the Prospectus (or any amendment or supplement to them) and that the Underwriter shall not be deemed to have provided any other information (and therefore is not responsible for any such statement or omission). (b) Any term sheet and prospectus subject to completion provided by the Company to the Underwriter for use in connection with the offering and sale of the Securities pursuant to Rule 434 under the Act together are not materially different from the Prospectus included in the Registration Statement. (c) Each preliminary prospectus and the Prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Act, and each Regis- 5 tration Statement filed pursuant to Rule 462(b) under the Act, if any, complied when so filed in all material respects with the Act. (d) The Company and each of its Subsidiaries, Citicasters and Noble have been duly organized, is validly existing as a corporation in good standing under the laws of its jurisdiction of organization and has the requisite corporate power and authority to carry on its business as it is currently being conducted, to own, lease and operate its properties and, as applicable, to authorize the offering of the Securities, including the Common Stock issuable upon conversion thereof to execute, deliver and perform this Agreement, and to issue, sell and deliver the Securities, including the Common Stock issuable upon conversion thereof and to execute, deliver and perform the Transaction Documents, as applicable, and each is duly qualified and is in good standing as a foreign corporation authorized to do business in each jurisdiction where the operation, ownership or leasing of property or the conduct of its business requires such qualification, except where the failure to be so qualified could not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the respective properties, business, results of operations, condition (financial or otherwise), affairs or prospects of each of (i) the Company and the Subsidiaries taken as a whole; (ii) Citicasters and its subsidiaries (collectively referred to herein as "Citicasters") taken as a whole; and (iii) Noble and its subsidiaries (collectively referred to herein as "Noble") taken as a whole; individually (a "Material Adverse Effect"). (e) All of the issued and outstanding shares of capital stock of, or other ownership interests in, each Subsidiary have been duly and validly authorized and issued, and all of the shares of capital stock of, or other ownership interests in, each Subsidiary are owned, directly or through Subsidiaries, by the Company and, upon completion of the trans- 6 actions contemplated by the Transaction Documents, all of the shares of capital stock of, or other ownership interests in, each of Citicasters and Noble, will be owned, directly or through Subsidiaries, by the Company. All such shares of capital stock are fully paid and nonassessable, and are owned free and clear of any security interest, mortgage, pledge, claim, lien or encumbrance (each, a "Lien"), except for Liens arising under the New Credit Facility. There are no outstanding subscriptions, rights, warrants, options, calls, convertible securities, commitments of sale or Liens related to or entitling any person to purchase or otherwise to acquire any shares of the capital stock of, or other ownership interest in, any Subsidiary. (f) The authorized, issued and outstanding capital stock of the Company is as set forth in the Prospectus under "Capitalization"; all the shares of issued and outstanding Common Stock have been duly authorized and validly issued and are fully paid, nonassessable and not subject to any preemptive or similar rights; the Securities, including the Common Stock issuable upon conversion thereof, have been duly authorized for issuance and sale to the Underwriters pursuant to this Agreement and, when issued and delivered by the Company pursuant to this Agreement against payment of the consideration set forth herein, will be validly issued and fully paid and nonassessable; the capital stock of the Company, including the Common Stock, conforms in all material respects to all statements relating thereto in the Prospectus and the Registration Statement; and the issuance of the Securities, including the Common Stock issuable upon conversion thereof by the Company will not be subject to preemptive or other similar rights. (g) None of the Company and any of the Subsidiaries, Citicasters or Noble, are in violation of their respective charters or bylaws or in default in the performance of any bond, debenture, note or any other evidence of 7 indebtedness or any indenture, mortgage, deed of trust or other contract, lease or other instrument to which the Company or any of the Subsidiaries, Citicasters or Noble is a party or by which any of them is bound, or to which any of the property or assets of the Company or any of the Subsidiaries, Citicasters or Noble is subject, except, in the case of Citicasters or Noble, as could not have a Material Adverse Effect. (h) This Agreement and the New Credit Facility have been duly authorized and validly executed and delivered by the Company and constitute a valid and legally binding agreement of the Company, enforceable against the Company in accordance with its terms (assuming, in the case of this Agreement, the due execution and delivery hereof by you). (i) The execution and delivery of this Agreement by the Company, the issuance and sale of the Securities, including the Common Stock issuable upon conversion thereof, the performance of this Agreement and the consummation of the transactions contemplated by this Agreement and the execution and delivery of the Transaction Documents by each of the Company, Citicasters and Noble, as applicable, and the consummation of the transactions contemplated by the Transaction Documents will not (1) conflict with or result in a breach or violation of any of the respective charters or bylaws of the Company or any of the Subsidiaries, Citicasters 8 or Noble, or any of the terms or provisions of, except, in the case of Citicasters or Noble, as could not have a Material Adverse Effect or (2) constitute a default or cause an acceleration of any obligation under or result in the imposition or creation of (or the obligation to create or impose) a Lien (except for Liens pursuant to the New Credit Facility) with respect to, any bond, note, debenture or other evidence of indebtedness or any indenture, mortgage, deed of trust or other agreement or instrument to which the Company or any of the Subsidiaries, Citicasters or Noble, is a party or by which it or any of them is bound, or to which any properties of the Company or any of the Subsidiaries, Citicasters or Noble, is or may be subject, except, in the case of Citicasters or Noble, as could not have a Material Adverse Effect, or (3) contravene any order of any court or governmental agency or body having jurisdiction over the Company or any of the Subsidiaries, Citicasters or Noble, or any of their properties, or violate or conflict with any statute, rule or regulation or administrative or court decree applicable to the Company or any of the Subsidiaries, Citicasters or Noble, or any of their respective properties, except, in the case of Citicasters or Noble, as could not have a Material Adverse Effect. (j) There is no action, suit or proceeding before or by any court or governmental agency or body, domestic or foreign, pending against or affecting the Company or any of the Subsidiaries, Citicasters or Noble, or any of their respective properties, which is required to be disclosed in the Registration Statement or the Prospectus, or which could reasonably be expected to result, singly or in the aggregate, in a Material Adverse Effect or which could reasonably be expected to materially and adversely affect the consummation of this Agreement or the transactions contemplated hereby or the consummation of the Transaction Documents or the transactions contemplated thereby, and to the best of the Company's knowledge, no such proceedings are contemplated or threatened. No contract or document of a character required to be described in the Registration Statement or the Prospectus or to be filed as an exhibit to the Registration Statement is not so described or filed. (k) No action has been taken and no statute, rule or regulation or order has been enacted, adopted or issued by any governmental agency or body which prevents the issuance of the Securities, including the Common Stock issuable upon conversion thereof, sus- 9 pends the effectiveness of the Registration Statement, prevents or suspends the use of any preliminary prospectus or suspends the sale of the Securities, including the Common Stock issuable upon conversion thereof, in any jurisdiction referred to in Section 4(g) hereof; no injunction, restraining order or order of any nature by a Federal or state court of competent jurisdiction has been issued with respect to the Company or any of the Subsidiaries which would prevent or suspend the issuance or sale of the Securities, including the Common Stock issuable upon conversion thereof, the effectiveness of the Registration Statement, or the use of any preliminary prospectus in any jurisdiction referred to in Section 4(g) hereof; no action, suit or proceeding is pending against or, to the best of the Company's knowledge, threatened against or affecting the Company or any of the Subsidiaries before any court or arbitrator or any governmental body, agency or official, domestic or foreign, which, if adversely determined, would materially interfere with or adversely affect the issuance of the Securities, including the Common Stock issuable upon conversion thereof, or in any manner draw into question the validity of the Transaction Documents; and every request of the Commission or any securities authority or agency of any jurisdiction for additional information (to be included in the Registration Statement or the Prospectus or otherwise) has been complied with in all material respects. (l) (i) None of the Company nor any of the Subsidiaries, Citicasters or Noble are in violation of any Federal, state or local laws and regulations relating to pollution or protection of human health or the environment (including, without limitation, ambient air, surface water, ground water, land surface or subsurface strata), including, without limitation, laws and regulations relating to emissions, discharges, releases or threatened releases of toxic or hazardous substances, materials or wastes, or petroleum and petroleum products ("Materials of Environmental Con 10 cern"), or otherwise relating to the protection of human health and safety, or the storage, disposal, transport or handling of Materials of Environmental Concern (collectively, "Environmental Laws"), which violation includes, but is not limited to, noncompliance with any permits or other governmental authorizations, except to the extent that any such violation could not have a Material Adverse Effect or otherwise require disclosure in the Prospectus; and (ii) to the best knowledge of the Company and any of the Subsidiaries, Citicasters or Noble, after due inquiry, (A) none of the Company and any of the Subsidiaries, Citicasters or Noble, have received any communication (written or oral), whether from a governmental authority or otherwise, alleging any such violation or noncompliance, and there are no circumstances, either past, present or that are reasonably foreseeable, that may lead to such violation in the future, (B) there is no pending or threatened claim, action, investigation or notice (written or oral) by any person or entity alleging potential liability for investigatory, cleanup, or governmental responses costs, or natural resources or property damages, or personal injuries, attorney's fees or penalties relating to (x) the presence, or release into the environment, of any Material of Environmental Concern at any location owned or operated by the Company and any of the Subsidiaries, Citicasters or Noble, now or in the past, or (y) circumstances forming the basis of any violation, or alleged violation, of any Environmental Law (collectively, "Environmental Claims") that could have a Material Adverse Effect or otherwise require disclosure in the Prospectus, and (C) there are no past or present actions, activities, circumstances, conditions, events or incidents, that could form the basis of any Environmental Claim against the Company and any of the Subsidiaries, Citicasters or Noble or against any person or entity whose liability for any Environmental Claim the Company and any of the Subsidiaries, Citicasters or Noble has retained or assumed either contractually or by operation of law. 11 In the ordinary course of its business, each of the Company and the Subsidiaries, Citicasters and Noble conducts a periodic review of the effect of Environmental Laws on the business, operations and properties of the in the course of which it identifies and evaluates associated costs and liabilities (including, without limitation, any capital or operating expenditures required for clean- up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties); on the basis of such review, the Company and the Subsidiaries, Citicasters and Noble have reasonably concluded that such associated costs and liabilities could not have a Material Adverse Effect. (m) None of the Company nor any of the Subsidiaries, Citicasters or Noble has violated any Federal, state or local law relating to discrimination in the hiring, promotion or pay of employees nor any applicable wage or hour laws, nor any provisions of the Employee Retirement Income Security Act of 1974 ("ERISA") or the rules and regulations promulgated thereunder, nor has the Company or any of the Subsidiaries, Citicasters or Noble engaged in any unfair labor practice, which in each case described in this sentence could reasonably be expected to result, singly or in the aggregate, in a Material Adverse Effect. There is (i) no significant unfair labor practice complaint pending against the Company or any of the Subsidiaries, Citicasters or Noble or, to the best knowledge of the Company, threatened against any of them, before the National Labor Relations Board or any state or local labor relations board, and no significant grievance or significant arbitration proceeding arising out of or under any collective bargaining agreement is so pending against the Company or any of the Subsidiaries, Citicasters or Noble or, to the best knowledge of the Company, threatened against any of them, (ii) no significant strike, labor dispute, slowdown or stop 12 page pending against the Company or any of its Subsidiaries, Citicasters or Noble or, to the best knowledge of the Company, threatened against the Company or any of the Subsidiaries, Citicasters or Noble and (iii) to the best knowledge of the Company, no union representation question existing with respect to the employees of the Company or any of the Subsidiaries, Citicasters or Noble and, to the best knowledge of the Company, no union organizing activities are taking place, except (with respect to any matter specified in clause (i), (ii) or (iii) above, singly or in the aggregate) such as could not have a Material Adverse Effect. (n) The Company and each of its Subsidiaries, Citicasters and Noble have good and marketable title, free and clear of all Liens, to all property and assets described in the Registration Statement as being owned by it, except for (i) Liens pursuant to the New Credit Facility, (ii) Liens on general office equipment which are not material to the Company's operations and (iii) Liens pursuant to the bank credit agreement entered into by Citicasters in October 1994. All leases to which the Company or the Subsidiaries, Citicasters or Noble are a party are valid and binding and no default has occurred or is continuing thereunder and the Company and each of its Subsidiaries, Citicasters and Noble enjoy peaceful and undisturbed possession under all such leases to which any of them is a party as lessee with such exceptions as do not materially interfere with the use made by the Company or any such Subsidiary, Citicasters and Noble. (o) The respective firm of accountants that has certified or shall certify the applicable consolidated financial statements and supporting schedules of the Company, Citicasters and Noble filed or to be filed with the Commission as part of the Registration Statement and the Prospectus are independent public accountants with respect to the Company and the Subsidiaries, Citicasters or Noble as 13 required by the Act. The consolidated historical and PRO FORMA financial statements, together with related schedules and notes, set forth in the Prospectus and the Registration Statement comply as to form in all material respects with the requirements of the Act. Such historical financial statements fairly present the consolidated financial position of the Company and the Subsidiaries at the respective dates indicated and the results of their operations and their cash flows for the respective periods indicated, in accordance with generally accepted accounting principles ("GAAP") consistently applied throughout such periods. Such PRO FORMA financial statements have been prepared on a basis consistent with such historical statements, except for the PRO FORMA adjustments specified therein, and give effect to assumptions made on a reasonable basis and present fairly the historical and proposed transactions contemplated by the Prospectus and the Transaction Documents. The other financial and statistical information and data included in the Prospectus and in the Registration Statement, historical and PRO FORMA, are, in all material respects, accurately presented and prepared on a basis consistent with such financial statements and the books and records of the Company, Citicasters and Noble. (p) Subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus and up to the Closing Date, none of the Company and any of the Subsidiaries, Citicasters or Noble have incurred any liabilities or obligations, direct or contingent, which are material to the Company and the Subsidiaries taken as a whole, Citicasters or Noble, respectively, nor entered into any transaction not in the ordinary course of business and there has not been, singly or in the aggregate, any material adverse change, or any development which could reasonably be expected to involve a material adverse change, in the properties, business, results of operations, condition (financial or 14 otherwise), affairs or prospects of the Company and the Subsidiaries taken as a whole, Citicasters or Noble, respectively each individually (a "Material Adverse Change"). (q) All tax returns required to be filed by the Company and any of the Subsidiaries, Citicasters and Noble in any jurisdiction have been filed, other than those filings being contested in good faith, and all material taxes, including withholding taxes, penalties and interest, assessments, fees and other charges due or claimed to be due from such entities have been paid, other than those being contested in good faith and for which adequate reserves have been provided or those currently payable without penalty or interest. (r) No authorization, approval or consent or order of, or filing with, any court or governmental body or agency is necessary in connection with the transactions contemplated by the Transaction Documents, except such as may be required by the NASD or have been obtained and made under the Act, the Exchange Act, the Trust Indenture Act of 1939, as amended (the "TIA") or state securities or "Blue Sky" laws or regulations. Neither the Company nor any of its affiliates is presently doing business with the government of Cuba or with any person or affiliate located in Cuba. (s) (i) Each of the Company and the Subsidiaries, Citicasters and Noble have all certificates, consents, exemptions, orders, permits, licenses, authorizations, or other approvals (each, an "Authorization") of and from, and has made all declarations and filings with, all Federal, state, local and other governmental authorities (including the Federal Communications Commission ("FCC")), all self-regulatory organizations and all courts and other tribunals, necessary or required to own, lease, license and use its properties and assets and to conduct its business in the manner described in the Prospectus, except to the extent that the failure to obtain or file could 15 not, singly or in the aggregate, reasonably be expected to have a Material Adverse Effect, (ii) all such Authorizations are valid and in full force and effect, (iii) each of the Company and the Subsidiaries, Citicasters and Noble are in compliance in all material respects with the terms and conditions of all such Authorizations and with the rules and regulations of the regulatory authorities and governing bodies having jurisdiction with respect thereto and (iv) each commercial radio broadcast station identified in the Prospectus as owned and operated by any of the Company, the Subsidiaries, Citicasters or Noble, as applicable, are operating with the maximum facilities specified by the Authorization pertaining thereto. (t) Neither the Company nor any of the Subsidiaries is (a) an "investment company" or a company "controlled" by an investment company within the meaning of the Investment Company Act of 1940, as amended, or (b) a "holding company" or a "subsidiary company" of a holding company, or an "affiliate" thereof within the meaning of the Public Utility Holding Company Act of 1935, as amended. (u) No holder of any security of the Company has or will have any right to require the registration of such security by virtue of any transaction contemplated by this Agreement. (v) The Securities have been approved for quotation on the Nasdaq SmallCap Market, subject to notice of issuance. (w) Each of the Company and the Subsidiaries, Citicasters and Noble possess the patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks and trade names (collectively, "Intellectual Property") presently employed by them in connection with the businesses now operated by them, and 16 none of the Company and the Subsidiaries, Citicasters or Noble have received any notice of infringement of or conflict with asserted rights of others with respect to the foregoing which, singly or in the aggregate, could reasonably be expected to result in any Material Adverse Change. The use of such Intellectual Property in connection with the business and operations of each of the Company and the Subsidiaries, Citicasters and Noble does not, to the Company's knowledge, infringe on the rights of any person except where any such infringement has not resulted in, or could not reasonably be expected to result in any Material Adverse Change. (x) Each certificate signed by any officer of the Company and delivered to the Underwriter or counsel for the Underwriter shall be deemed to be a representation and warranty by the Company to the Underwriter as to the matters covered thereby. (y) Each of the Company and the Subsidiaries, Citicasters and Noble maintain a system of internal accounting controls sufficient to provide reasonable assurance that (1) transactions are executed in accordance with management's general or specific authorizations; (2) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability; (3) access to assets is permitted only in accordance with management's general or specific authorization; and (4) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. (z) The Company has not (i) taken, directly or indirectly, any action designed to cause or to result in, or that has constituted or which could reasonably be expected to constitute, the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of 17 the Securities or (ii) since the initial filing of the Registration Statement (A) sold, bid for, purchased, or paid anyone any compensation for soliciting purchases of, the Securities or (B) paid or agreed to pay to any person any compensation for soliciting another to purchase any other securities of the Company. (aa) Each of the Company and the Subsidiaries, Citicasters and Noble maintains insurance covering their properties, operations, personnel and businesses. Such insurance insures against such losses and risks as are adequate in accordance with customary industry practice to protect the Company and its Subsidiaries and their businesses. None of the Company and any Subsidiary, Citicasters or Noble have received notice from any insurer or agent of such insurer that substantial capital improvements or other expenditures will have to be made in order to continue such insurance. All such insurance is outstanding and duly in force on the date hereof and will be outstanding and duly in force on the Closing Date. (bb) None of the Company, Citicasters or Noble have, directly or indirectly, paid or delivered any fee, commission or other sum of money or item or property, however characterized, to any finder, agent, government official or other party, in the United States or any other country, which is in any manner related to the business or operations of the Company, Citicasters or Noble, respectively, which the Company knows or has reason to believe to have been illegal under any Federal, state or local laws of the United States or any other country having jurisdiction; and none of the Company, Citicasters or Noble have participated, directly or indirectly, in any boycotts or other similar practices in contravention of law affecting any of its actual or potential customers. (cc) Except as disclosed in the Prospectus, none of the Company, Citicasters or Noble own any "margin securities" as that term 18 is defined in Regulations G and U of the Board of Governors of the Federal Reserve System (the "Federal Reserve Board"), and none of the proceeds of the sale of the Securities will be used, directly or indirectly, for the purpose of purchasing or carrying any margin security, for the purpose of reducing or retiring any indebtedness which was originally incurred to purchase or carry any margin security or for any other purpose which might cause any of the Securities to be considered a "purpose credit" within the meanings of Regulation G, T, U or X of the Federal Reserve Board. (dd) Each person described in the Prospectus as a person to whom the Company or any of the Subsidiaries provides programming pursuant to a local marketing agreement or a joint sales agreement (a "Licensee") has been issued by the FCC an FCC license (which is in full force and effect) for the operation of the commercial radio broadcast station identified in the Prospectus as programmed by the Company or any of its Subsidiaries, which licenses expire on the dates set forth in the Prospectus. (ee) Each person described in the Prospectus as a person to whom the Company or any of the Subsidiaries provides programming pursuant to an exclusive sales agency agreement (a "Mexican Licensee"), has been issued by the Mexican government all necessary Mexican licenses (which are in full force and effect) for the operation of the commercial radio broadcast station identified in the Prospectus as programmed by the Company or any of its Subsidiaries. Each of the Company and its Subsidiaries have all Authorizations necessary to deliver programming to the Mexican Licensees. (ff) Each of the Company and its Subsidiaries, Citicasters and Noble has filed with the FCC all material reports, documents, instruments, information and applications required to be filed pursuant to the FCC's rules, regulations and requests. No notice has been 19 issued by the FCC which could permit, or after notice or lapse of time or both could permit, revocation or termination of any FCC license of any of the Subsidiaries, or Noble or its subsidiaries or Citicasters or its subsidiaries, or to the knowledge of the Company, of any of the Licensees prior to the expiration dates thereof or which could reasonably be expected to result in any other material impairment of any of the Company's, Subsidiaries or Noble or its subsidiaries or Citicasters or its subsidiaries or, to the knowledge of the Company, of any of the Licensees' rights thereunder and which could reasonably be expected to, singly or in the aggregate, have a Material Adverse Effect. (gg) Each of the Stations is now operating, and has operated, in compliance in all material respects with the Communications Act of 1934, as amended (the "Communications Act"), and the published rules and regulations of the FCC. There is not issued, outstanding or pending any Notice of Violation, Notice of Apparent Liability, Order to Show Cause, material complaint or investigation by or before the FCC which could materially threaten or materially adversely affect any of the Company's or any of its Subsidiary's, Noble's or its subsidiaries', Citicasters' or its subsidiaries' or, to the knowledge of the Company, any Licensees' FCC licenses or which could reasonably be expected to result in any material adverse effect upon any of the Company's, Subsidiaries', Noble or its subsidiaries, Citicasters or its subsidiaries or, to the knowledge of the Company, any Licensees' operation of its respective stations and which could reasonably be expected to, singly or in the aggregate, have a Material Adverse Effect, nor does the Company have reason to believe that the FCC licenses with respect to the Stations will not be renewed for a full eight year term when such FCC licenses are due for renewal. 20 (hh) The execution, delivery and performance of the obligations by the Company under this Agreement are not and will not be contrary to the Communications Act, as amended, will not result in any violation of the FCC's published rules and regulations, will not cause any forfeiture or impairment of any FCC license of any of the Stations by or before the FCC, and will not require any consent, approval or authorization of the FCC. (ii) The execution, delivery and performance of the obligations by each of the parties to the Merger Agreement and the Noble Acquisition Agreement are not and will not be contrary to the Communications Act, will not result in any violation of the FCC's published rules and regulations, will not cause any forfeiture or impairment of any FCC license of any of the Stations by or before the FCC, and will not require any consent, approval or authorization of the FCC (other than approval for a transfer of control over the relevant Stations). All necessary applications, exhibits or other filings required by the FCC for transfer of control of the Stations now controlled by Citicasters and Noble pursuant to the Merger Agreement and the Noble Acquisition Agreement have been filed with the FCC (the "Transfer Applications"). To the best of the Company's knowledge, there are no circumstances that would cause the FCC to reject the Transfer Applications. (jj) For purposes of considering the application of the local ownership rules contained in the Telecommunications Act of 1996, the Denver market contains more than 45 commercial stations. (kk) The Company, Merger Sub, Citicasters and Noble (each, a "Merger Party" and, collectively the "Merger Parties") have, to the extent each is or will be a party thereto, all requisite corporate power and authority to execute, deliver and perform their respective obligations under each of the Transaction 21 Documents; each of the Transaction Documents has been duly and validly authorized, executed and delivered by the Merger Parties, to the extent each is a party thereto, and each constitutes a valid and legally binding agreement of the Merger Party enforceable against each Merger Party in accordance with its terms; except as set forth in the Prospectus, no consent, approval, authorization or order of any court or governmental agency or body is required for the performance of any of the Transaction Documents by each of the Merger Parties, to the extent each is a party thereto, or the consummation by each of the Merger Parties of any of the transactions contemplated thereby, except such as may be required and have been obtained, or upon effectiveness of the Registration Statement, will have been obtained, under the Act, the Exchange Acts, the TIA, or state securities or "Blue Sky" laws or regulations or such as may be required by the NASD in connection with the purchase and distribution of the Securities by the Underwriters; and none of the Merger Parties is (i) in violation of its charter or bylaws, (ii) in violation of any statute, judgment, decree, order, rule or regulation applicable to any of them or any of their respective properties or assets, which violation would have a Material Adverse Effect, or (ii) in default in the performance or observance of any obligation, agreement, covenant or condition contained in any of the Transaction Documents or any other contract, indenture, mortgage, deed of trust, loan agreement note, lease, license, franchise agreement, permit, Authorizations, certificate or agreement or instrument to which any of them is a party or to which any of them is subject, which default would have a Material Adverse Effect. (ll) The execution, delivery and performance by the Merger Parties, to the extent each is a party thereto, of each of the Transaction Documents, and the consummation by the respective Merger Parties of the transactions contemplated thereby, will not violate, conflict with or constitute or result in a 22 breach of or a default under (or an event which, with notice or lapse of time, or both, would constitute a breach of or a default under) any of (i) the terms or provisions of any of the Transaction Documents or any other indenture, mortgage, deed of trust, loan agreement, note, lease, license, franchise agreement, or agreement or instrument to which a Merger Party, is a party or to which any of their respective properties or assets are subject, which violation, conflict, breach or default would have a Material Adverse Effect, (ii) the charter or bylaws of the Merger Party, or (iii) any statute, judgment, decree, order, rule or regulation of any court, governmental agency or other body or self regulatory organization applicable to each Merger Party, or any of their respective properties or assets, which violation, conflict, breach or default would have a Material Adverse Effect. (mm) The Merger and the Noble Acquisition have been duly authorized by the relevant Merger Parties and the transactions contemplated by the Transaction Documents have been approved, to the extent required, by all appropriate corporate action; approval of the transactions contemplated by the Transaction Documents by the shareholders of the Company is not required; the Transaction Documents conform and the Merger and the Noble Acquisition will conform in all material respects to the descriptions thereof in the Prospectus. (nn) The Company has delivered to the Underwriter a true and correct copy of each of the Transaction Documents that have been executed and delivered prior to the date of this Agreement and each other Transaction Document in the form substantially as it will be executed and delivered, together with all related agreements and all schedules and exhibits thereto, and there have been no amendments, alterations, modifications or waivers of any of the provisions of any of the Transaction Documents since their date of execution or from the form in which it has been delivered to the 23 Underwriter; there exists as of the date hereof (after giving effect to the transactions contemplated by the Transaction Documents) no event or condition which would constitute a default or an event of default (in each case as defined in the New Credit Facility, the Common Stock or the Sub Notes, respectively) under the New Credit Facility, the Common Stock or the Sub Notes, respectively, and no event or condition which would constitute a default or an event of default (in each case as defined in each of the Transaction Documents) under any of the Transaction Documents other than the New Credit Facility, the Common Stock or the Sub Notes, respectively, which would result in a Material Adverse Effect or materially adversely effect the ability of each of the Company, Citicasters or Noble to consummate the transactions contemplated by the Transaction Documents. (oo) No director, officer or substantial shareholder of the Company has a 5% or greater interest (or no such persons collectively have a 10% or greater interest), directly or indirectly, in Citicasters or Noble. (pp) The shares of Common Stock to be issued pursuant to the Merger Agreement, will not have upon issuance, voting power equal to or in excess of 20% of the voting power outstanding before the issuance of the common stock or securities convertible into or exercisable for Common Stock. (qq) The Securities have received a rating of B3 from Moody's Investor Services ("Moody's"); and the Sub Notes have received a rating of B2 from Moody's. (rr) Each of the representations and warranties contained in each of the Transaction Documents are true and correct on and as of the date hereof, except as could not have a Material Adverse Effect. 24 SECTION 2. SALE AND DELIVERY TO UNDERWRITER; CLOSING. On the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Company agrees to sell to the Underwriter and the Underwriter agrees to purchase from the Company, at the price per $1,000 principal amount at maturity set forth in the Pricing Agreement, the Initial Securities. (1) If the Company has elected not to rely upon Rule 430A under the 1933 Act Regulations, the initial public offering price, the initial conversion rate and the purchase price (per $1,000 principal amount at maturity) to be paid by the Underwriter for the Securities have each been determined and set forth in the Pricing Agreement, dated the date hereof, and an amendment to the Registration Statement and the Prospectus will be filed before the Registration Statement becomes effective. (2) If the Company has elected to rely upon Rule 430A under the 1933 Act Regulations, the purchase price (per $1,000 principal amount at maturity) to be paid by the Underwriter for the Securities shall be an amount equal to the initial public offering price, less an amount per Security to be determined by agreement between the Underwriter and the Company. The initial public offering price (per $1,000 principal amount at maturity) of the Securities and the initial conversion rate applicable to the Securities likewise shall be determined by agreement between the Underwriter and the Company. The initial public offering price, the initial conversion rate and the purchase price, when so determined, shall be set forth in the Pricing Agreement. In the event that such prices have not been agreed upon and the Pricing Agreement has not been executed and delivered by the parties thereto by the close of business on the fourth business day following the date of this Agreement, this Agreement shall terminate forthwith, without liability of any party to any other party, unless otherwise agreed to by the Company and the Underwriter. (b) In addition, on the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Company hereby grants an option to the Underwriter, to purchase from it any or all of the Option Securities (in 25 multiples of $1,000 principal amount at maturity) at the same price (per $1,000 principal amount at maturity) as is to be paid by the Underwriter for the Initial Securities, plus accrued amortization of original issue discount, if any, on the terms set forth in the Pricing Agreement. The option hereby granted will expire 30 days after (i) the date the Registration Statement becomes effective, if the Company has elected not to rely on Rule 430A under the 1933 Act Regulations, or (ii) the Representation Date, if the Company has elected to rely on Rule 430A under the 1933 Act Regulations, and may be exercised in whole or in part from time to time only for the purpose of covering over-allotments which may be made in connection with the offering and distribution of the Initial Securities upon notice by the Underwriter to the Company setting forth the number of Option Securities as to which the Underwriter is then exercising the option and the time and date of payment and delivery for such Option Securities. Any such time and date of delivery (a "Date of Delivery") shall be determined by the Underwriter, but shall not be later than seven full business days after the exercise of said option, nor in any event prior to the Closing Time, as hereinafter defined, unless otherwise agreed by the Underwriter and the Company. (c) Delivery of the Initial Securities shall be made at the offices of the Underwriter in New York City, and payment of the purchase price for the Initial Securities shall be made at the offices of counsel for the Company in __________, ____, or, in each case, at such other place as shall be agreed upon by the Underwriter and the Company, at 10:00 A.M., New York City time, on the fourth business day following the date the Registration Statement becomes effective (or, if the Company has elected to rely upon Rule 430A, the fourth business day after execution of the Pricing Agreement), or such other time not later than ten business days after such date as shall be agreed upon by the Underwriter and the Company (such time and date of payment and delivery being herein called the "Closing Time"). In addition, in the event that any or all of the Option Securities are purchased by the Underwriter, payment of the purchase price for, and delivery of certificates for, such Option Securities shall be made at the offices set forth above, or at such other place as shall be agreed upon by the Underwriter and the Company, on the Date of Delivery as specified in the notice from the Underwriter to the 26 Company. Payment shall be made by certified or official bank check or checks drawn in New York Clearing House funds or similar next day funds payable to the order of the Company against delivery to the Underwriter of certificates for the Securities to be purchased by it. Certificates for the Securities and the Option Securities, if any, shall be in such denominations and registered in such names as the Underwriter may request in writing at least two business days before Closing Time or the Date of Delivery, as the case may be. The certificates for the Initial Securities and the Option Securities, if any, will be made available for examination and packaging by the Underwriter not later than 10:00 A.M., New York City time, on the last business day prior to the Closing Time or the Date of Delivery, as the case may be, in New York City. SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with the Underwriter as follows: (a) It will, if the Registration Statement has not heretofore become effective under the Act, file an amendment to the Registration Statement or, if necessary pursuant to Rule 430A under the Act, a post-effective amendment to the Registration Statement, in each case as soon as practicable after the execution and delivery of this Agreement, and will use its best efforts to cause the Registration Statement or such post-effective amendment to become effective at the earliest possible time. The Company will comply fully and in a timely manner with the applicable provisions of Rule 424 and Rule 430A, and if applicable, Rule 462, under the Act. (b) It will advise you promptly and, if requested by any of you, confirm such advice in writing, (i) when the Registration Statement has become effective, if and when the Prospectus is sent for filing pursuant to Rule 424 under the Act and when any post-effective amendment to the Registration Statement becomes effective, (ii) of the receipt of any comments from the Commission or any state securities commission or regulatory authority that relate to the Registration Statement or requests by 27 the Commission or any state securities commission or regulatory authority for amendments to the Registration Statement or amendments or supplements to the Prospectus or for additional information, (iii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement, or of the suspension of qualification of the Securities for offering or sale in any jurisdiction, or the initiation of any proceeding for such purpose by the Commission or any state securities commission or other regulatory authority, and (iv) of the happening of any event during such period as in your reasonable judgment you are required to deliver a prospectus in connection with sales of the Securities by you which makes any statement of a material fact made in the Registration Statement untrue or which requires the making of any additions to or changes in the Registration Statement (as amended or supplemented from time to time) in order to make the statements therein not misleading or that makes any statement of a material fact made in the Prospectus (as amended or supplemented from time to time) untrue or which requires the making of any additions to or changes in the Prospectus (as amended or supplemented from time to time) in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The Company shall use its best efforts to prevent the issuance of any stop order or order suspending the qualification or exemption of the Securities under any state securities or Blue Sky laws, and, if at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption of the Securities under any state securities or Blue Sky laws, the Company shall use every reasonable effort to obtain the withdrawal or lifting of such order at the earliest possible time. 28 (c) It will furnish to you without charge two (2) signed copies (plus one (1) additional signed copy to your legal counsel) of the Registration Statement as first filed with the Commission and of each amendment to it, including all exhibits filed therewith, and will furnish to you such number of conformed copies of the Registration Statement as so filed and of each amendment to it, without exhibits, as you may reasonably request. (d) It will not file any amendment or supplement to the Registration Statement, whether before or after the time when it becomes effective, or make any amendment or supplement to the Prospectus, of which you shall not previously have been advised and provided a copy within two business days prior to the filing thereof (or such reasonable amount of time as is necessitated by the exigency of such amendment or supplement) or to which you shall reasonably object; and it will prepare and file with the Commission, promptly upon your reasonable request, any amendment to the Registration Statement or supplement to the Prospectus which may be necessary or advisable in connection with the distribution of the Securities by you, and will use its best efforts to cause any amendment to the Registration Statement to become effective as promptly as possible. (e) Promptly after the Registration Statement becomes effective, and from time to time thereafter for such period in your reasonable judgment as a prospectus is required to be delivered in connection with sales of the Securities by you, it will furnish to each Underwriter and dealer without charge as many copies of the Prospectus (and of any amendment or supplement to the Prospectus) as such Underwriters and dealers may reasonably request. The Company consents to the use of the Prospectus and any amendment or supplement thereto by any Underwriter or any dealer, both in connection with the offering or sale of the Securities and for such period of time thereafter as the Prospectus is required by the Act or the 29 Exchange Act to be delivered in connection therewith. (f) If during such period as in your reasonable judgment you are required to deliver a prospectus in connection with sales of the Securities by you any event shall occur as a result of which it becomes necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances existing as of the date the Prospectus is delivered to a purchaser, not misleading, or if it is necessary to amend or supplement the Prospectus to comply with any law, it will promptly prepare and file with the Commission an appropriate amendment or supplement to the Prospectus so that the statements in the Prospectus, as so amended or supplemented, will not, in the light of the circumstances existing as of the date the Prospectus is so delivered, be misleading, and will comply with applicable law, and will furnish to each Underwriter and dealer without charge such number of copies thereof as such Underwriters and dealers may reasonably request. (g) Prior to any public offering of the Securities, it will cooperate with you and your counsel in connection with the registration or qualification of the Securities[, including the Common Stock issuable upon conversion thereof,] for offer and sale by you under the state securities or Blue Sky laws of such jurisdictions as you may request (provided, that the Company shall not be obligated to qualify as a foreign corporation in any jurisdiction in which it is not so qualified or to take any action that would subject it to general consent to service of process in any jurisdiction in which it is not now so subject). The Company will continue such qualification in effect so long as required by law for distribution of the Securities. (h) It will make generally available to its security holders as soon as reasonably practicable a consolidated earning statement 30 covering a period of at least twelve months beginning after the "effective date" (as defined in Rule 158 under the Act) of the Registration Statement (but in no event commencing later than 90 days after such date) which shall satisfy the provisions of Section 11(a) of the Act and Rule 158 thereunder, and to advise you in writing when such statement has been so made available. (i) It will timely complete all required filings and otherwise fully comply in a timely manner with all provisions of the Exchange Act. (j) During the period of five years hereafter, the Company will furnish to you (i) as soon as available, a copy of each report of the Company mailed to shareholders or filed with the Commission, and (ii) from time to time such other information concerning the Company as you may request. (k) It will use the proceeds from the sale of the Securities in the manner described in the Prospectus under the caption "Use of Proceeds." (l) It will cause the Securities to be quoted on the Nasdaq SmallCap Market and will use its reasonable best efforts to maintain such quotation while any of the Securities are outstanding. (m) It will use its best efforts to do and perform all things required to be done and performed under this Agreement by it prior to or after the Closing Date and to satisfy all conditions precedent on its part to the delivery of the Securities. (n) It will timely complete all required filings and otherwise comply fully in a timely manner with all provisions of the Exchange Act, and will file all reports and any definitive proxy or information statements required to be filed by the Company with the 31 Commission pursuant to Sections 13(a), 13(c), 14(a) or 15(d) of the Exchange Act subsequent to the date of the Prospectus and for so long as the delivery of a prospectus is required in connection with the offer or sale of the Securities, including the Common Stock issuable upon conversion thereof. (o) During the period beginning on the date of this Agreement and continuing to and including the Closing Date, except as described in the Prospectus with respect to the Merger or the Noble Acquisition, there will be no transactions entered into by the Company or any of its subsidiaries (each a "Subsidiary" and, collectively, the "Subsidiaries"), Citicasters or Noble which are material with respect to the Company or any of the Subsidiaries, Citicasters or Noble, respectively, taken individually or as a whole, and there will be no dividend or distribution of any kind declared, paid or made by the Company on any class of capital stock or other equity interests. SECTION 4. PAYMENT OF EXPENSES. Whether or not the transactions contemplated hereby are consummated or this Agreement is terminated, the Company will pay and be responsible for all costs, expenses, fees and taxes in connection with or incident to (i) the printing, processing, filing, distribution and delivery under the Act or the Exchange Act of the Registration Statement, each preliminary prospectus, the Prospectus and all amendments or supplements thereto, (ii) the printing, processing, execution, distribution and delivery of this Agreement, any memoranda describing state securities or Blue Sky laws and all other agreements, memoranda, correspondence and other documents printed, distributed and delivered in connection with the offering of the Securities, (iii) the registration with the Commission and the issuance and delivery of the Securities, (iv) the registration or qualification of the Securities for offer and sale under the securities or Blue Sky laws of the jurisdictions referred to in paragraph (g) above (including, in each case, the fees and disbursements of counsel relating to such registration or qualification and memoranda relating thereto and any filing fees in connection therewith), (v) 32 furnishing such copies of the Registration Statement, Prospectus and preliminary prospectus, and all amendments and supplements to any of them, as may be reasonably requested by you, (vi) filing, registration and clearance with the NASD in connection with the offering of the Securities (including any filing fees in connection therewith and the fees and disbursements of counsel relating thereto), (vii) the listing of the Securities on the Nasdaq Stock Market's SmallCap Market (the "NASDAQ SmallCap Market"), (viii) the rating of the Securities and the Sub Notes by investment rating agencies, (ix) any "qualified independent underwriter" as required by Schedule E of the Bylaws of the NASD (including fees and disbursements of counsel for such qualified independent underwriter), (x) the printing, processing, execution, distribution and delivery of the Transaction Documents and all other agreements, memoranda, correspondence and other documents, printed, distributed and delivered in connection with the Transaction Documents and (xi) the performance by the Company of its other obligations under this Agreement, the cost of its personnel and other internal costs, the cost of printing and engraving the certificates representing the Securities, and all expenses and taxes incident to the sale and delivery of the Securities to you. SECTION 5. CONDITIONS OF UNDERWRITER'S OBLIGATIONS. The obligations of the Underwriter hereunder are subject to the accuracy of the representations and warranties of the Company herein contained, to the performance by the Company of its obligations hereunder, and to the following further conditions: (a) All the representations and warranties of the Company contained in this Agreement shall be true and correct on the Closing Date with the same force and effect as if made on and as of the Closing Date. The Company shall have performed or complied with all of its obligations and agreements herein contained and required to be performed or complied with by it at or prior to the Closing Date. (b) (i) The Registration Statement shall have become effective (or, if a post-effective amendment is required to be filed pursuant to Rule 430A promulgated under the Act, such post-effective amend- 33 ment shall have become effective) not later than 10:00 A.M. (and in the case of a Registration Statement filed under Rule 462(b) of the Act, not later than 10:00 P.M.), New York City time, on the date of this Agreement or at such later date and time as you may approve in writing, (ii) at the Closing Date, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been commenced or shall be pending before or contemplated by the Commission and every request for additional information on the part of the Commission shall have been complied with in all material respects, and (iii) no stop order suspending the sale of the Securities in any jurisdiction referred to in Section 5(g) shall have been issued and no proceeding for that purpose shall have been commenced or shall be pending or threatened. (c) No action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted or issued by any governmental agency which would, as of the Closing Date, prevent the issuance of the Securities, including the Common Stock issuable upon conversion thereof,; and no injunction, restraining order or order of any nature by a Federal or state court of competent jurisdiction shall have been issued as of the Closing Date which would prevent the issuance of the Securities, including the Common Stock issuable upon conversion thereof, the Common Stock, or the Sub Notes or the consummation of the transactions contemplated by the Transaction Documents. (d) (i) Since the date hereof or since the dates as of which information is given in the Registration Statement and the Prospectus, there shall not have been any Material Adverse Change, (ii) since the date of the latest balance sheet included in the Registration Statement and the Prospectus, there shall not have been any material change in the capital stock or long-term debt, or material increase in short-term debt, of the Company or any of the Subsidiaries taken as a whole, Citicasters or 34 Noble and (iii) the Company and the Subsidiaries taken as a whole, Citicasters or Noble shall have no liability or obligation, direct or contingent, that is material to the Company and the Subsidiaries taken as a whole, Citicasters or Noble, respectively, and is required to be disclosed on a balance sheet in accordance with GAAP and is not disclosed on the latest applicable balance sheet included in the Registration Statement and the Prospectus. (e) You shall have received a certificate of the Company, dated the Closing Date, executed on behalf of the Company, by the President or any Vice President and a principal financial or accounting officer of the Company confirming, as of the Closing Date, the matters set forth in paragraphs (a), (b), (c) and (d) of this Section 5. (f) On the Closing Date, you shall have received: (1) an opinion (satisfactory to you and your counsel), dated the Closing Date, of Graydon, Head & Ritchey, counsel for the Company, to the effect that: (i) (A) the Company and each of the Subsidiaries is a duly organized and validly existing corporation in good standing under the laws of its jurisdiction of incorporation, has the requisite corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement and the Prospectus, and is duly qualified as a foreign corporation and in good standing in each jurisdiction where the ownership, leasing or operation of property or the conduct of its business requires such qualification, except where the failure to be so qualified could not be reasonably expected to have, singly or in the aggregate, a Material Adverse Effect; and (B) the Company has the requisite corporate power and authority to execute, deliver and perform this Agreement; 35 (ii) (A) the Company has full power and authority to execute, deliver and perform its obligations under the Transaction Documents; (iii) the Transaction Documents have been duly authorized, executed and delivered by the Company; (iv) (A) the authorized, issued and outstanding capital stock of the Company is as set forth in the Prospectus under "Capitalization" and conforms in all material respects to the descriptions thereof contained in the Registration Statement and the Prospectus; (B) the shares of issued and outstanding Common Stock, have been duly authorized and are validly issued and are fully paid and nonassessable; (C) the Securities have been duly authorized for issuance and sale to the Underwriters pursuant to this Agreement and, when issued and delivered by the Company pursuant to this Agreement against payment of the consideration set forth herein, will be validly issued and fully paid and nonassessable; and (D) the issuance of the Securities is not subject to preemptive or other similar rights; (v) all of the issued and outstanding shares of capital stock of, or other ownership interests in, each Subsidiary have been duly and validly authorized and issued, and the shares of capital stock of, or other ownership interests in, each Subsidiary are owned, directly or through Subsidiaries, by the Company, are fully paid and nonassessable, and are owned free and clear of any Lien, except for Liens pursuant to the New Credit Facility; (vi) to the knowledge of such counsel (after due inquiry) there are no outstanding subscriptions, rights, warrants, options, calls, convertible securities, commitments of sale or Liens related to or entitling any person to purchase or otherwise to acquire any shares of the capital stock of, or other 36 ownership interest in, any Subsidiary except as disclosed in the Prospectus; (vii) neither the Company nor any of the Subsidiaries is (a) an "investment company" or a company "controlled" by an investment company within the meaning of the Investment Company Act of 1940, as amended, or (b) a "holding company" or a "subsidiary company" of a holding company, or an "affiliate" thereof within the meaning of the Public Utility Holding Company Act of 1935, as amended; (viii) neither the consummation of the transactions contemplated by this Agreement nor the sale, issuance, execution or delivery of the Securities, the Common Stock or the Sub Notes will violate Regulation G, T, U or X of the Board of Governors of the Federal Reserve System; (ix) when authenticated in accordance with the terms of the indenture and delivered to and paid for in accordance with the terms of the agreement, the Sub Notes will constitute a valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms and entitled to the benefits of the indenture, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity) and except to the extent that a waiver of rights under any usury laws may be unenforceable; (x) the shares of common stock, no par value per share, initially issuable upon conversion of the Securities have been duly authorized and reserved for issuance upon conversion of the Securities, are free of preemptive rights and, when issued upon conversion of the Securities in accordance with the terms of the Indenture, will be validly issued, fully paid and non-assessable; 37 (xi) the Indenture, assuming due authorization, execution and delivery thereof by the Trustee, constitutes a valid and legally binding obligations of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity) and except to the extent that a waiver of rights under any usury laws may be unenforceable; (xii) when authenticated in accordance with the terms of the Indenture and delivered to and paid for in accordance with the terms of this Agreement, the Securities will constitute a valid and legally binding obligation of the Company, enforceable against the Company in accordance with their terms and entitled to the benefits of the indenture, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity) and except to the extent that a waiver of rights under any usury laws may be unenforceable; (xiii) to the best knowledge of such counsel, there is no current, pending or threatened action, suit or proceeding before any court or governmental agency, authority or body or any arbitrator involving the Company or any Subsidiary or to which any of their respective properties is subject of a character required to be disclosed in the Registration Statement which is not adequately disclosed in the Prospectus; 38 (xiv) the descriptions in the Registration Statement and the Prospectus of statutes, legal and governmental proceedings and contracts and other documents are accurate in all material respects and fairly present the information required to be shown; and such counsel does not know of any legal or governmental proceedings required to be described in the Registration Statement or Prospectus which are not described as required or of any contracts or documents of a character required to be described in the Registration Statement or Prospectus or to be filed as exhibits to the Registration Statement which are not described and filed as required; it being understood that such counsel need express no opinion as to the financial statements, notes or schedules or other financial data included therein; (xv) the Registration Statement has become effective under the Act; any required filing of the Prospectus, and any supplements and term sheets thereto, pursuant to Rule 424(b) has been made in the manner and within the time period required by Rule 424(b); and to the knowledge of such counsel (after due inquiry) no stop order suspending the effectiveness of the Registration Statement or any part thereof has been issued and no proceedings therefor have been instituted or are pending or contemplated under the Act; (xvi) no authorization, approval, consent or order of, or filing with, any court or governmental body or agency is required for the consummation by the Company of the transactions contemplated by the Transaction Documents, except such as have been obtained and made under the Act, the Exchange Act, the TIA, state securities or "Blue Sky" laws or regulations or such as may be required by the NASD; no authorization, approval, consent or order of, or filing with, any court or governmental body or agency is required for the consummation by the Company, Citicasters or Noble of the transactions contemplated by the applicable Transaction Documents; the execution and deliv- 39 ery of this Agreement, the issuance and sale of the Securities, the performance of this Agreement and the consummation of the transactions contemplated by this Agreement will not result in a breach or violation of any of (A) any of the respective charters or bylaws of the Company or any of the Subsidiaries or (B) to the knowledge of such counsel (after due inquiry), the terms or provisions of any agreement or instrument which is filed as an exhibit to the Registration Statement and to which the Company or any of the Subsidiaries is a party or by which any of them is bound, or to which any of the properties of the Company or any of the Subsidiaries is subject, or (C) to the knowledge of such counsel (after due inquiry) constitute a default under, any statute, rule or regulation to which the Company or any Subsidiary is bound or to which any of the properties of the Company or any Subsidiary is subject or (D) any order of any court or governmental agency or body having jurisdiction over the Company or any of the Subsidiaries or any of their properties which conflict, breach or default in each of the cases described in clauses (B), (C) and (D) could reasonably be expected to have a Material Adverse Effect; (xvii) at the time it became effective and on the Closing Date, the Registration Statement complied as to form in all material respects with the Act; (xviii) to the knowledge of such counsel, none of the Company and the Subsidiaries, Citicasters or Noble have received any notice of infringement of or conflict with asserted rights of others with respect to the Intellectual Property which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, could reasonably be expected to result in a Material Adverse Change. The use of such Intellectual Property in connection with the business and operations of the Company and the Subsidiaries, Citicasters and Noble does not, to the knowl- 40 edge of such counsel, infringe on the rights of any person; (xix) to the best knowledge of such counsel, (A) there are no franchises, contracts, indentures, mortgages, loan agreements, notes, leases or other instruments to which the Company and any of the Subsidiaries, Citicasters and Noble are a party or by which any of them may be bound that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement other than those described therein or filed as exhibits thereto, (B) no default exists in the due performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, loan agreement, note, lease or other instrument so described or filed in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement, or any agreement identified on a schedule attached to the opinion, except for defaults which could not reasonably be expected to have a Material Adverse Effect and (C) the statements in the Prospectus under the captions "Description of Capital Stock" and "Securities Eligible for Future Sale" insofar as they relate to statements of law or legal conclusions, are accurate in all material respects; and (xx) the Company and the Subsidiaries, Citicasters and Noble to the extent each is a party thereto, have full power and authority to execute, deliver and perform the Transaction Documents; (xxi) the Transaction Documents; conform in all material respects to the descriptions thereof contained in the Prospectus; (xxii) the Transaction Documents, assuming the authorization, execution and delivery thereof by the parties other than the Company, Merger Sub, Citicasters or Noble, constitute valid and legally binding agreements of the respective parties thereto enforceable 41 against each of the parties, to the extent each is a party thereto, in accordance with their respective terms subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights generally and to principles of equity (regardless of whether enforcement is sought in a proceeding at law or equity) and except to the extent that a waiver of rights under usury laws may be unenforceable; and (xxiii) the approval of the transactions contemplated by the Transaction Documents by the shareholders of the Company is not required. (2) Such counsel shall additionally state that such counsel has participated in conferences with officers and other representatives of the Company, representatives of the independent public accountants for the Company, your representatives and your counsel in connection with the preparation of the Registration Statement and Prospectus and has considered the matters required to be stated therein and the statements contained therein, although such counsel has not independently verified the accuracy, completeness or fairness of such statements (except as indicated above); and such counsel advises you that, on the basis of the foregoing, no facts came to such counsel's attention that caused such counsel to believe that the Registration Statement (as amended or supplemented, if applicable), at the time such Registration Statement or any post-effective amendment became effective, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading (other than information omitted therefrom in reliance on Rule 430A under the Act), or the Prospectus (as amended or supplemented), as of its date and the Closing Date, contained an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Without limiting the foregoing, such counsel may further state that the firm assumes no responsibility for, and the firm has not independently verified, the accuracy, completeness or fairness of the financial 42 statements, notes and schedules and other financial data included in the Registration Statement. (3) An opinion (satisfactory to you and your counsel), dated the Closing Date of Hogan & Hartson, counsel for the Company with respect to FCC and related matters to the effect that: (i) Those statements in the Prospectus under the caption "Business -- Federal Regulation of Radio Broadcasting" that describe provisions of the Communications Act, and regulations, rules and policies of the FCC, are accurate descriptions in all material respects; (ii) the execution, delivery and performance of the obligations as of the date hereof of the Company and each of its Subsidiaries, Citicasters and Noble under the Transaction Documents will not violate any law, rule, regulation or order of the FCC or the terms of any license; (iii) no application, filing or registration with, or approval, authorization, consent, adjudication or order of the FCC which has not been made or obtained is required to be made or obtained by the Company or any Subsidiary, Citicasters and Noble in connection with the execution, delivery and performance of the obligations as of the date hereof of the Company and each of its Subsidiaries, Citicasters and Noble under the Transaction Documents; (iv) Schedule A to the opinion shall set forth a complete list of the authorizations issued by the FCC to the Company and its Subsidiaries (for purposes of the opinion only, the "Licenses"). To such counsel's knowledge, the Licenses are the only licenses, permits or authorizations required under the Communications Act for the operation of the radio stations listed on Schedule B (for purposes of the opinion only, the "Jacor Stations"). Except for the pending applications noted on Schedule A thereto, the Licenses are 43 in full force and effect (and the time within which any administrative or judicial appeal, reconsideration, rehearing or other review has lapsed with respect to the grant of the authorizations for the currently effective terms, and no such appeal, reconsideration, rehearing, or other review has been taken or instituted), and are duly and validly held by the relevant Subsidiary, and are valid until the dates set forth in Schedule A thereto. Except as indicated on Schedule C to such opinion, the Licenses are not subject to any conditions other than those that appear on the Licenses or are customarily imposed by the FCC on radio stations of the same class and type. To such counsel's knowledge, each of the Jacor Stations is licensed to operate with the maximum facilities specified by the License pertaining thereto; (v) except as listed in Schedule D hereto, there is no proceeding or other administrative action pending or, to such counsel's knowledge, threatened, before the FCC against the Company or any Subsidiary, which, if adversely determined, would adversely affect the business or condition of the Company or any Subsidiary. To such counsel's knowledge, except as listed on Schedules D and E to such opinion, the Company and the Subsidiaries are in compliance with the Licenses and with the provisions of the Communications Act and the rules and regulations promulgated thereunder, except as would not have a material adverse effect on the Company. To such counsel's knowledge, except as listed on Schedule E to such opinion, the Company and the Subsidiaries have filed with the FCC all material reports, forms and statements required to be filed by the Company and the Subsidiaries with the FCC with respect to the Jacor Stations, such filings are complete and accurate and such filings have been timely; and (vi) except that prior FCC approval is required for a transfer of control, the execution, delivery and performance of the 44 obligations by the each of the parties under the Transaction Documents are not and will not be contrary to the Communications Act, will not result in any violation of the FCC's published rules and regulations (other than the one-to-a-market rule), will not cause any forfeiture or impairment of any FCC license of any of the Stations by or before the FCC, and will not require any consent, approval or authorization of the FCC (other than approval for a transfer of control over the relevant Stations). All necessary applications, exhibits or other filings required by the FCC for transfer of control of the Stations now controlled by Citicasters and Noble pursuant to the Transaction Documents (for purposes of the opinion only, the Transfer Applications") have been filed with the FCC. To such counsel's knowledge, there are no circumstances that would cause the FCC to reject the Transfer Applications. (4) An opinion (satisfactory to you and your counsel), dated the Closing Date, of Haley Bader & Potts, counsel for Noble with respect to FCC and related matters to the effect that: (i) Schedule A to the opinion sets forth a complete list of the authorizations issued by the FCC to Noble (for purposes of the opinion only, the "Licenses"). To our knowledge, the Licenses are the only licenses, permits or authorizations required under the Communications Act for the operation of the radio stations listed on Schedule B to such opinion (for purposes of the opinion only, the "Noble Stations"). Except for the pending applications noted on Schedule A to the opinion, the Licenses are in full force and effect (and the time within which any administrative or judicial appeal, reconsideration, rehearing or other review has lapsed with respect to the grant of the authorizations for the currently effective terms, and no such appeal, reconsideration, rehearing, or other review has been taken or instituted), and are duly and validly held by the relevant subsidiary, and are valid until the dates set forth in Schedule A there- 45 to. Except as indicated on Schedule C to the opinion, the Licenses are not subject to any conditions other than those that appear on the Licenses or are customarily imposed by the FCC on radio stations of the same class and type. To our knowledge, each of the Noble Stations is licensed to operate with the maximum facilities specified by the License pertaining thereto; (ii) except as listed in Schedule D to the opinion, there is no proceeding or other administrative action pending or, to such counsel's knowledge, threatened, before the FCC against Noble, which, if adversely determined, would adversely affect the business or condition of Noble. To such counsel's knowledge, except as listed on Schedules D and E to the opinion, Noble is in compliance with the Licenses and with the provisions of the Communications Act and the Rules, except as would not have a material adverse effect on Noble. To such counsel's knowledge, except as listed on Schedule E to the opinion, Noble has filed with the FCC all material reports, forms and statements required to be filed by Noble with the FCC with respect to the Noble Stations, such filings are complete and accurate and such filings have been timely; and (iii) except that prior FCC approval is required for a transfer of control, the execution, delivery and performance of the obligations by the each of the parties under the Noble Acquisition Agreement are not and will not be contrary to the Communications Act, will not result in any violation of the FCC's published rules and regulations, will not cause any forfeiture or impairment of any FCC license of any of the stations by or before the FCC, and will not require any consent, approval or authorization of the FCC (other than approval for a transfer of control over the relevant stations). All necessary applications, exhibits or other filings required by the FCC for transfer of control of the Noble stations pursuant to the Noble Acquisition Agreement (for purposes of the opinion only, the "Transfer 46 Applications") have been filed with the FCC. To such counsel's knowledge, there are no circumstances that would cause the FCC to reject the Transfer Applications. (5) An opinion (satisfactory to you and your counsel), dated the Closing Date, of ________________, counsel for Citicasters with respect to FCC and related matters to the effect that: (i) Schedule A to the opinion sets forth a complete list of the authorizations issued by the FCC to Citicasters (for purposes of the opinion only, the "Licenses"). To our knowledge, the Licenses are the only licenses, permits or authorizations required under the Communications Act for the operation of the radio stations listed on Schedule B to the opinion (for purposes of the opinion only, the "Citicasters Stations"). Except for the pending applications noted on Schedule A thereto, the Licenses are in full force and effect (and the time within which any administrative or judicial appeal, reconsideration, rehearing or other review has lapsed with respect to the grant of the authorizations for the currently effective terms, and no such appeal, reconsideration, rehearing, or other review has been taken or instituted), and are duly and validly held by the relevant Subsidiary, and are valid until the dates set forth in Schedule A thereto. Except as indicated on Schedule C to the opinion, the Licenses are not subject to any conditions other than those that appear on the Licenses or are customarily imposed by the FCC on radio stations of the same class and type. To our knowledge, each of the Citicasters Stations is licensed to operate with the maximum facilities specified by the License pertaining thereto; (ii) except as listed in Schedule D to the opinion, there is no proceeding or other administrative action pending or, to our knowledge, threatened, before the FCC against Citicasters, which, if adversely determined, would adversely affect the business or condi- 47 tion of Citicasters. To such counsel's knowledge, except as listed on Schedules D and E to the opinion, Citicasters is in compliance with the Licenses and with the provisions of the Communications Act and the Rules, except as would not have a material adverse effect on Citicasters. To such counsel's knowledge, except as listed on Schedule E to the opinion, Citicasters has filed with the FCC all material reports, forms and statements required to be filed by Citicasters with the FCC with respect to the Citicasters Stations, such filings are complete and accurate and such filings have been timely; and (iii) except that prior FCC approval is required for a transfer of control, the execution, delivery and performance of the obligations by the each of the parties under the Merger Agreement is not and will not be contrary to the Communications Act, will not result in any violation of the FCC's published rules and regulations, will not cause any forfeiture or impairment of any FCC license of any of the Stations by or before the FCC, and will not require any consent, approval or authorization of the FCC (other than approval for a transfer of control over the relevant stations). All necessary applications, exhibits or other filings required by the FCC for transfer of control of the Citicasters stations pursuant to the Merger Agreement for purposes of the opinion only, the "Transfer Applications") have been filed with the FCC. To such counsel's knowledge, there are no circumstances that would cause the FCC to reject the Transfer Applications. (g) You shall have received an opinion, dated the Closing Date, of Skadden, Arps, Slate, Meagher & Flom ("Skadden Arps"), counsel for the Underwriters, in form and substance reasonably satisfactory to you. (h) You shall have received letters on and as of the date hereof as well as on and as of the Closing Date (in the latter case constituting an 48 affirmation of the statements set forth in the former), in form and substance satisfactory to you, from Coopers & Lybrand, Ernst & Young LLP and Price Waterhouse LLP, independent public accountants, with respect to the financial statements and certain financial information contained in the Registration Statement and the Prospectus for each of the Company, Citicasters and Noble, respectively. (i) Skadden Arps shall have been furnished with such documents and opinions, in addition to those set forth above, as they may reasonably require for the purpose of enabling them to review or pass upon the matters referred to in this Section 5 and in order to evidence the accuracy, completeness or satisfaction in all material respects of any of the representations, warranties or conditions herein contained. (j) Prior to the Closing Date, the Company shall have furnished to you such further information, certificates and documents as you may reasonably request. (k) At the Closing Date, the Securities and the Common Stock shall have been approved for quotation on the Nasdaq SmallCap Market and Nasdaq National Market, respectively, subject to notice of issuance. (l) You shall have received each of the opinions required to be delivered under any of the other Transaction Documents, together with appropriate reliance letters addressed to the Underwriters. (m) There shall have been no amendments, alterations, modifications, or waivers of any provisions of the Transaction Documents since the date of the execution and delivery thereof by the parties thereto other than those which under the Act are not required to be disclosed in the Prospectus or any supplement thereto and which have been disclosed to the Underwriters prior to the date hereof. (n) Each of the Company, Citicasters and Noble shall, to the extent each is a party thereto, have complied in all respects with all agreements 49 and covenants in the Transaction Documents and performed all conditions specified therein that the terms thereof require to be complied with or performed at or prior to the Effective Time of the Merger. (o) Prior to or concurrently with the purchase and sale of the Securities hereunder, the Company shall have entered into the New Credit Facility and satisfied all conditions to borrowing thereunder and you shall received counterparts, conformed as executed, thereof. The Lenders under the New Credit Facility shall have indicated to you that all such conditions have been satisfied and that they are prepared to fund them term loans in the amount of $_________ and revolving loans in the amount of $__________ upon consummation of the Merger. (p) Prior to or concurrently with the purchase and sale of the Securities hereunder, the Company shall have completed the issuance and sale of the Common Stock and the Sub Notes. (q) Except as is disclosed to the Underwriters in writing, the representations and warranties of the Company, Citicasters and Noble set forth in the Transaction Documents shall be true, accurate and complete in all respects. SECTION 6. INDEMNIFICATION. The Company agrees to indemnify and hold harmless (i) the Underwriter and (ii) each person, if any, who controls (within the meaning of Section 15 of the Act or Section 20 of the Exchange Act) any of the Underwriters (any of the persons referred to in this clause (ii) being hereinafter referred to as a "controlling person"), and (iii) the respective officers, directors, partners, employees, representatives and agents of any of the Underwriter or any controlling person (any person referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an "Indemnified Person") to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments, actions and expenses (including without limitation and as incurred, reimbursement of all reasonable costs of investigating, preparing, pursuing or defending any claim or action, or any investigation or proceeding 50 by any governmental agency or body, commenced or threatened, including the reasonable fees and expenses of counsel to any Indemnified Person) directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including the information deemed to be a part of the Registration Statement or the Prospectus (including any amendment or supplement thereto) or any preliminary prospectus, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of the Prospectus, in light of the circumstances under which they were made) not misleading, PROVIDED, HOWEVER, that (i) except insofar as such losses, claims, damages, liabilities, judgments, actions or expenses are caused by an untrue statement or omission or alleged untrue statement or omission that is made in reliance upon and in conformity with information relating to the Underwriter furnished in writing to the Company by the Underwriter expressly for use in the Registration Statement (or any amendment thereto) or the Prospectus (or any amendment or supplement thereto) or any preliminary prospectus, (ii) the foregoing indemnity agreement with respect to any untrue statement contained in or omission from a preliminary prospectus shall not inure to the benefit of the Underwriter from whom the person asserting any such losses, liabilities, claims, damages or expenses purchased Securities, or any person controlling such Underwriter, if a copy of the Prospectus (as then amended or supplemented, if the Company shall have furnished any amendments or supplements thereto) was not sent or given by or on behalf of the Underwriter to such person, if such is required by law, at or prior to the written confirmation of the sale of such Securities to such person and the untrue statement contained in or omission from such preliminary prospectus was corrected in the Prospectus (or the Prospectus as amended or supplemented). The Company shall notify you promptly of the institution, threat or assertion of any claim, proceeding (including any governmental investigation) or litigation in connection with the matters addressed by this Agreement which involves the Company or an Indemnified Person. (b) In case any action or proceeding (including any governmental investigation) shall be brought or asserted 51 against any of the Indemnified Persons with respect to which indemnity may be sought against the Company, the Underwriter shall promptly notify the Company in writing (provided, that the failure to give such notice shall not relieve the Company of its obligations pursuant to this Agreement). Such Indemnified Person shall have the right to employ its own counsel in any such action and the fees and expenses of such counsel shall be paid, as incurred, by the Company (regardless of whether it is ultimately determined that an Indemnified Party is not entitled to indemnification hereunder). The Company shall not, in connection with any one such action or proceeding or separate but substantially similar or related actions or proceedings in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) at any time for such Indemnified Persons, which firm shall be designated by the Underwriter. The Company shall be liable for any settlement of any such action or proceeding effected with the Company's prior written consent, which consent will not be unreasonably withheld, and the Company agrees to indemnify and hold harmless any Indemnified Person from and against any loss, claim, damage, liability or expense by reason of any settlement of any action effected with the written consent of the Company. Notwithstanding the foregoing sentence, if at any time an Indemnified Person shall have requested the Company to reimburse the Indemnified Person for fees and expenses of counsel as contemplated by the second sentence of this paragraph, the Company agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 10 business days after receipt by the Company of the aforesaid request, and (ii) the Company shall not have reimbursed the Indemnified Person in accordance with such request prior to the date of such settlement. The Company shall not, without the prior written consent of each Indemnified Person, settle or compromise or consent to the entry of judgment in or otherwise seek to terminate any pending or threatened action, claim, litigation or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not any Indemnified Person is a party thereto), unless such settlement, compromise, consent or termination includes an unconditional release of 52 each Indemnified Person from all liability arising out of such action, claim, litigation or proceeding. (c) The Underwriter agrees to indemnify and hold harmless the Company, its directors, its officers who sign the Registration Statement, any person controlling (within the meaning of Section 15 of the Act or Section 20 of the Exchange Act) the Company, and the officers, directors, partners, employees, representatives and agents of each such person, to the same extent as the foregoing indemnity from the Company to each of the Indemnified Persons, but only with respect to claims and actions based on information relating to the Underwriter furnished in writing by the Underwriter expressly for use in the Prospectus. (d) If the indemnification provided for in this Section 6 is unavailable to an indemnified party in respect of any losses, claims, damages, liabilities, judgments, actions or expenses referred to herein, then each indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities, judgments, actions and expenses (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party on the one hand and the indemnified party on the other hand from the offering of the Securities or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the indemnifying parties and the indemnified party, as well as any other relevant equitable considerations. The relative benefits received by the Company, on the one hand, and of the Underwriter, on the other hand, shall be deemed to be in the same proportion as the total proceeds from the offering (net of underwriting discounts and commissions but before deducting expenses) received by the Company bear to the total underwriting discounts and commissions received by the Underwriter, in each case as set forth in the table on the cover page of the Prospectus. The relative fault of the Company and the Underwriter shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact related to information 53 supplied by the Company or the Underwriter and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The indemnity and contribution obligations of the Company set forth herein shall be in addition to any liability or obligation the Company may otherwise have to any Indemnified Person. The Company and the Underwriter agree that it would not be just and equitable if contribution pursuant to this Section 6(d) were determined by PRO RATA allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities, judgments, actions or expenses referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 6, the Underwriter (and its related Indemnified Persons) shall be required to contribute, in the aggregate, any amount in excess of the amount by which the total underwriting discount applicable to the Securities purchased by the Underwriter exceeds the amount of any damages which the Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. SECTION 7. CONTRIBUTION. In order to provide for just and equitable contribution in circumstances in which the indemnity agreement provided for in Section 6 is for any reason held to be unenforceable by the Indemnified Parties although applicable in accordance with its terms, the Company and the Underwriter shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by said indemnity agreement incurred by the Company and the Underwriter, as incurred, in such proportions that the Underwriter is responsible for that portion represented by the percentage that the underwriting discount appearing on the cover page of the Prospectus bears to the initial public offer- 54 ing price appearing thereon, and the Company is responsible for the balance; PROVIDED, HOWEVER, that no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each person, if any, who controls an Underwriter within the meaning of Section 15 of the 1933 Act shall have the same rights to contribution as the Underwriter, and each director of the Company, each officer of the Company who signed the Registration Statement, and each person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act shall have the same rights to contribution as the Company. SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY. All representations, warranties and agreements contained in this Agreement and the Pricing Agreement, or contained in certificates of officers of the Company submitted pursuant to Section 5 of this Agreement, shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of the Underwriter or controlling person, or by or on behalf of the Company, and shall survive delivery of the Securities to the Underwriter and any termination of this Agreement. SECTION 9. TERMINATION OF AGREEMENT. This Agreement shall become effective upon the later of (i) the execution and delivery of this Agreement by the parties hereto, (ii) the effectiveness of the Registration Statement, and (iii) if a post-effective amendment is required to be filed pursuant to Rule 430A under the Act, the effectiveness of such post-effective amendment. This Agreement may be terminated at any time on or prior to the Closing Date by you by notice to the Company if any of the following has occurred: (i) subsequent to the date the Registration Statement is declared effective or the date of this Agreement, any Material Adverse Change occurs which, in the judgment of any Underwriter, make it impracticable or inadvisable to market the Securities or to enforce contracts for the sale of the Securities, (ii) any outbreak or escalation of hostilities or other national or international calamity or crisis or material adverse change in the financial markets of the United States or elsewhere, or any other 55 substantial national or international calamity or emergency if the effect of such outbreak, escalation, calamity, crisis or emergency would, in the judgment of any Underwriter, make it impracticable or inadvisable to market the Securities or to enforce contracts for the sale of the Securities, (iii) any suspension or limitation of trading generally in securities on the New York Stock Exchange, the American Stock Exchange, the Nasdaq Stock Market or in the over-the-counter markets or any setting of minimum prices for trading on such exchanges or markets, (iv) any declaration of a general banking moratorium by Federal, New York or Ohio authorities, (v) the taking of any action by any Federal, state or local government or agency in respect of its monetary or fiscal affairs that in your judgment has a material adverse effect on the financial markets in the United States, and would, in your judgment, make it impracticable or inadvisable to market the Securities or to enforce contracts for the sale of the Securities, (vi) the enactment, publication, decree, or other promulgation of any Federal or state statute, regulation, rule or order of any court or other governmental authority which, in your judgment, materially and adversely affects or will materially and adversely affect the business or operations of the Company or any Subsidiary, or (vii) any securities of the Company or any of the Subsidiaries shall have been downgraded or placed on any "watch list" for possible downgrading by any nationally recognized statistical rating organization, PROVIDED, that in the case of such "watch list" placement, termination shall be permitted only if such placement would, in the judgment of any Underwriter, make it impracticable or inadvisable to market the Securities or to enforce contracts for the sale of the Securities or materially impair the investment quality of the Securities. The indemnities and contribution provisions and the other agreements, representations and warranties of the Company, its officers and directors and of the Underwriters set forth in or made pursuant to this Agreement shall remain operative and in full force and effect, and will survive delivery of and payment for the Securities, regardless of (i) any investigation, or statement as to the results thereof, made by or on behalf of any of the Underwriters or by or on behalf of the Company, the officers or directors of the Company or any controlling person of the Company, (ii) acceptance of the Securities 56 and payment for them hereunder and (iii) termination of this Agreement. If this Agreement shall be terminated by the Underwriters pursuant to clauses (i) or (vii) of the second paragraph of this Section 9 or because of the failure or refusal on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, the Company agrees to reimburse you for all out-of-pocket expenses (including the fees and disbursements of counsel) incurred by you. Notwithstanding any termination of this Agreement, the Company shall be liable for all expenses which it has agreed to pay pursuant to Section 4 hereof. SECTION 10. NOTICES. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication. Notices to the Underwriter shall be directed to the Underwriter at [Sears Tower Building, Suite 5500, Chicago, Illinois 60606], Attention of [Brit Bartter], Managing Director, with a copy to Skadden, Arps, Slate, Meagher & Flom, 300 South Grand Avenue, Suite 3400, Los Angeles, California 90071, Attention: Gregg A. Noel, Esq.; notices to the Company shall be directed to it at 1300 PNC Center, 201 East Fifth Street, Cincinnati, Ohio 45202, Attention: Randy Michaels, President, with a copy to Graydon, Head & Ritchey, 1900 Fifth Third Center, 511 Walnut Street, P.O. Box 6464, Cincinnati, Ohio 45201, Attention: Richard G. Schmalzl, Esq. SECTION 11. PARTIES. This Agreement and the Pricing Agreement shall each inure to the benefit of and be binding upon the Underwriter and the Company and their respective successors, heirs and legal representatives. Nothing expressed or mentioned in this Agreement or in the Pricing Agreement is intended or shall be construed to give any person, firm or corporation, other than the Underwriter and the Company and their respective successors, heirs and legal representatives, and the controlling persons and officers and directors referred to in Sections 6 and 7 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or the Pricing Agreement or any provision herein or therein contained. This Agreement and the Pricing Agreement and all condi- 57 tions and provisions hereof and thereof are intended to be for the sole and exclusive benefit of the Underwriter and the Company and their respective successors, heirs and legal representatives and said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No purchaser of Securities from any Underwriter shall be deemed to be a successor by reason merely of such purchase. SECTION 12. GOVERNING LAW AND TIME. This Agreement and the Pricing Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made and to be performed in said State. Specified times of day refer to New York City time. 58 If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement between the Underwriter and the Company in accordance with its terms. Very truly yours, JACOR COMMUNICATIONS, INC. By ----------------------------- Name: Title: By ----------------------------- Name: Title: CONFIRMED AND ACCEPTED, as of the date first above written: MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED By _________________________ Name: Title: _______________, Investment Banking Group 59 Exhibit A JACOR COMMUNICATIONS, INC. (A DELAWARE CORPORATION) $ PRINCIPAL AMOUNT AT MATURITY LIQUID YIELD OPTION-TM- NOTES DUE 2011 (ZERO COUPON - SUBORDINATED) PRICING AGREEMENT _________, 1996 Merrill Lynch & Co. Merrill Lynch, Pierce, Fenner & Smith Incorporated Merrill Lynch World Headquarters North Tower World Financial Center New York, New York 10281-1305 Dear Sirs: Reference is made to the Purchase Agreement, dated , 1996 (the "Purchase Agreement"), relating to the purchase by Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated (the "Underwriter"), of the above Liquid Yield Option-TM- Notes (the "Securities"), of Jacor Communications, Inc. (the "Company"). Pursuant to Section 2 of the Purchase Agreement, the Company agrees with the Underwriter as follows: 1. The initial public offering price per $1,000 principal amount at maturity of Securities shall be $ . _______________ - -TM- Trademark of Merrill Lynch & Co., Inc. 60 2. The initial conversion rate per $1,000 principal amount at maturity of Securities shall be . 3. The purchase price per $1,000 principal amount at maturity of Securities to be paid by the Underwriter shall be $ , being an amount equal to the initial public offering price set forth above, less $ per $1,000 principal amount at maturity of Securities, plus accrued amortization of original issue discount, if any, from the date of issuance, calculated on a semiannual bond equivalent basis. 61 If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement between the Underwriter and the Company in accordance with its terms. Very truly yours, JACOR COMMUNICATIONS, INC. By ----------------------------------- Name: Title: By ----------------------------------- Name: Title: CONFIRMED AND ACCEPTED, as of the date first above written: MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED By ______________________________ Name: Title: ______________________, Investment Banking Group 62 Exhibit B MATERIAL SUBSIDIARIES Jacor Broadcasting of Florida, Inc. Jacor Broadcasting of Atlanta, Inc. Jacor Broadcasting of Knoxville, Inc. Jacor Broadcasting of Colorado, Inc. Jacor Broadcasting of Tampa Bay, Inc. Jacor Cable, Inc. Georgia Network Equipment, Inc. Jacor Broadcasting Corporation Broadcast Finance, Inc. Chesapeake Securities, Inc. Jacor Broadcasting of St. Louis, Inc. JCAC, Inc. 63 EX-4.23 3 EX-4.23 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- JACOR COMMUNICATIONS, INC. LIQUID YIELD OPTION-TM- NOTES DUE 2011 (ZERO COUPON -- SENIOR) _______________________ INDENTURE Dated as of _______, 1996 _______________________ The Bank of New York, Trustee - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- TM-Trademark of Merrill Lynch & Co., Inc. TABLE OF CONTENTS NOTE: This Table of Contents shall not, for any purpose, be deemed to be part of the Indenture. Page ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . . 1 SECTION 1.02. Other Definitions . . . . . . . . . . . . . . . . . 6 SECTION 1.03. Incorporation by Reference of Trust Indenture Act . . . . . . . . . . . . . . . . . . 6 SECTION 1.04. Rules of Construction . . . . . . . . . . . . . . . 7 ARTICLE 2 THE SECURITIES SECTION 2.01. Form and Dating . . . . . . . . . . . . . . . . . . . 7 SECTION 2.02. Execution and Authentication. . . . . . . . . . . . . 8 SECTION 2.03. Registrar, Paying Agent and Conversion Agent . . . . . . . . . . . . . . . . . . . . . . . 9 SECTION 2.04. Paying Agent To Hold Money and Securities in Trust . . . . . . . . . . . . . . . . 9 SECTION 2.05. Securityholder Lists. . . . . . . . . . . . . . . . 10 SECTION 2.06. Transfer and Exchange . . . . . . . . . . . . . . . 10 SECTION 2.07. Replacement Securities. . . . . . . . . . . . . . . 11 SECTION 2.08. Outstanding Securities; Determinations of Holders' Action. . . . . . . . . . . . . . . . 12 SECTION 2.09. Temporary Securities. . . . . . . . . . . . . . . . 13 SECTION 2.10. Cancellation. . . . . . . . . . . . . . . . . . . . 13 SECTION 2.11. CUSIP Numbers . . . . . . . . . . . . . . . . . . . 14 ARTICLE 3 REDEMPTION AND PURCHASES SECTION 3.01. Right to Redeem; Notices to Trustee . . . . . . . . 14 SECTION 3.02. Selection of Securities to Be Redeemed. . . . . . . 15 SECTION 3.03. Notice of Redemption. . . . . . . . . . . . . . . . 15 SECTION 3.04. Effect of Notice of Redemption. . . . . . . . . . . 16 SECTION 3.05. Deposit of Redemption Price . . . . . . . . . . . . 16 SECTION 3.06. Securities Redeemed in Part . . . . . . . . . . . . 17 SECTION 3.07. Conversion Arrangement on Call for Redemption. . . . . . . . . . . . . . . . . . . . 17 SECTION 3.08. Purchase of Securities at the Option of the Holder. . . . . . . . . . . . . . . . . . . . 18 SECTION 3.09. Purchase of Securities at Option of the Holder upon Change in Control . . . . . . . . . . 25 SECTION 3.10. Effect of Purchase Notice or Change in Control Purchase Notice . . . . . . . . . . . . . 28 SECTION 3.11. Deposit of Purchase Price or Change in Control Purchase Price. . . . . . . . . . . . . . 30 i SECTION 3.12. Securities Purchased in Part. . . . . . . . . . . . 30 SECTION 3.13. Covenant to Comply with Securities Laws upon Purchase of Securities . . . . . . . . . . . 31 SECTION 3.14. Repayment to the Company. . . . . . . . . . . . . . 31 ARTICLE 4 COVENANTS SECTION 4.01. Payment of Securities . . . . . . . . . . . . . . . 31 SECTION 4.02. SEC Reports . . . . . . . . . . . . . . . . . . . . 32 SECTION 4.03. Compliance Certificate; Notice of Defaults. . . . . . . . . . . . . . . . . . . . . 32 SECTION 4.04. Further Instruments and Acts. . . . . . . . . . . . 33 SECTION 4.05. Maintenance of Office or Agency . . . . . . . . . . 33 SECTION 4.06. Calculation of Original Issue Discount. . . . . . . 33 ARTICLE 5 SUCCESSOR CORPORATION SECTION 5.01. When Company May Merge or Transfer Assets. . . . . . . . . . . . . . . . . . . . . . 34 SECTION 5.02. Successor Company Substituted.. . . . . . . . . . . 34 ARTICLE 6 DEFAULTS AND REMEDIES SECTION 6.01. Events of Default . . . . . . . . . . . . . . . . . 35 SECTION 6.02. Acceleration. . . . . . . . . . . . . . . . . . . . 37 SECTION 6.03. Other Remedies. . . . . . . . . . . . . . . . . . . 37 SECTION 6.04. Waiver of Past Defaults . . . . . . . . . . . . . . 38 SECTION 6.05. Control by Majority . . . . . . . . . . . . . . . . 38 SECTION 6.06. Limitation on Suits . . . . . . . . . . . . . . . . 38 SECTION 6.07. Rights of Holders to Receive Payment. . . . . . . . 39 SECTION 6.08. Collection Suit by Trustee. . . . . . . . . . . . . 39 SECTION 6.09. Trustee May File Proofs of Claim. . . . . . . . . . 39 SECTION 6.10. Priorities. . . . . . . . . . . . . . . . . . . . . 40 SECTION 6.11. Undertaking for Costs . . . . . . . . . . . . . . . 41 SECTION 6.12. Notice of Defaults. . . . . . . . . . . . . . . . . 41 SECTION 6.13. Waiver of Stay, Extension or Usury Laws . . . . . . 41 ARTICLE 7 TRUSTEE SECTION 7.01. Rights of Trustee . . . . . . . . . . . . . . . . . 42 SECTION 7.02. Individual Rights of Trustee. . . . . . . . . . . . 43 SECTION 7.03. Trustee's Disclaimer. . . . . . . . . . . . . . . . 43 SECTION 7.04. Notice of Defaults. . . . . . . . . . . . . . . . . 44 SECTION 7.05. Reports by Trustee to Holders . . . . . . . . . . . 44 SECTION 7.06. Compensation and Indemnity. . . . . . . . . . . . . 44 SECTION 7.07. Replacement of Trustee. . . . . . . . . . . . . . . 45 SECTION 7.08. Successor Trustee by Merger . . . . . . . . . . . . 46 SECTION 7.09. Eligibility; Disqualification . . . . . . . . . . . 46 SECTION 7.10. Preferential Collection of Claims Against Company . . . . . . . . . . . . . . . . . 46 ii SECTION 7.11. Money Held in Trust . . . . . . . . . . . . . . . . 46 ARTICLE 8 DISCHARGE OF INDENTURE SECTION 8.01. Discharge of Liability on Securities. . . . . . . . 47 SECTION 8.02. Repayment to the Company. . . . . . . . . . . . . . 47 ARTICLE 9 AMENDMENTS SECTION 9.01. Without Consent of Holders. . . . . . . . . . . . . 48 SECTION 9.02. With Consent of Holders . . . . . . . . . . . . . . 48 SECTION 9.03. Compliance with Trust Indenture Act . . . . . . . . 50 SECTION 9.04. Revocation and Effect of Consents, Waivers and Actions . . . . . . . . . . . . . . . 50 SECTION 9.05. Notation on or Exchange of Securities . . . . . . . 50 SECTION 9.06. Trustee to Sign Supplemental Indentures . . . . . . 50 SECTION 9.07. Effect of Supplemental Indentures . . . . . . . . . 50 ARTICLE 10 CONVERSION SECTION 10.01. Conversion Privilege . . . . . . . . . . . . . . . 51 SECTION 10.02. Conversion Procedure . . . . . . . . . . . . . . . 52 SECTION 10.03. Fractional Shares. . . . . . . . . . . . . . . . . 53 SECTION 10.04. Taxes on Conversion. . . . . . . . . . . . . . . . 53 SECTION 10.05. Company to Provide Stock . . . . . . . . . . . . . 54 SECTION 10.06. Adjustment for Change in Capital Stock . . . . . . 54 SECTION 10.07. Adjustment for Rights Issue. . . . . . . . . . . . 55 SECTION 10.08. Adjustment for Other Distributions . . . . . . . . 56 SECTION 10.09. When Adjustment May Be Deferred. . . . . . . . . . 59 SECTION 10.10. When No Adjustment Required. . . . . . . . . . . . 59 SECTION 10.11. Notice of Adjustment . . . . . . . . . . . . . . . 60 SECTION 10.12. Voluntary Increase . . . . . . . . . . . . . . . . 60 SECTION 10.13. Notice of Certain Transactions . . . . . . . . . . 60 SECTION 10.14. Reorganization of Company; Special Distributions. . . . . . . . . . . . . . . . . . 61 SECTION 10.15. Company Determination Final. . . . . . . . . . . . 62 SECTION 10.16. Trustee's Adjustment Disclaimer. . . . . . . . . . 62 SECTION 10.17. Simultaneous Adjustments . . . . . . . . . . . . . 62 SECTION 10.18. Successive Adjustments . . . . . . . . . . . . . . 62 ARTICLE 11 MISCELLANEOUS SECTION 11.01. Trust Indenture Act Controls . . . . . . . . . . . 63 SECTION 11.02. Notices. . . . . . . . . . . . . . . . . . . . . . 63 SECTION 11.03. Communication by Holders with Other Holders. . . . . . . . . . . . . . . . . . . . . 64 SECTION 11.04. Certificate and Opinion as to Conditions Precedent . . . . . . . . . . . . . . 64 SECTION 11.05. Statements Required in Certificate or Opinion. . . . . . . . . . . . . . . . . . . . . 64 iii SECTION 11.06. Separability Clause. . . . . . . . . . . . . . . . 65 SECTION 11.07. Rules By Trustee, Paying Agent, Conversion Agent and Registrar . . . . . . . . . 65 SECTION 11.08. Legal Holiday. . . . . . . . . . . . . . . . . . . 65 SECTION 11.09. GOVERNING LAW. . . . . . . . . . . . . . . . . . . 65 SECTION 11.10. No Recourse Against Others . . . . . . . . . . . . 65 SECTION 11.11. Successors . . . . . . . . . . . . . . . . . . . . 65 SECTION 11.12. Multiple Originals . . . . . . . . . . . . . . . . 65 SIGNATURES EXHIBIT A Form of Face of LYON. . . . . . . . . . . . . . . . . . . . . . . A-1 iv CROSS-REFERENCE TABLE* TIA Indenture Section Section 310(a)(1) ............................................ 7.09 (a)(2) ............................................ 7.09 (a)(3) ............................................ N.A. (a)(4) ............................................ N.A. (b) ............................................ 7.07; 7.09 (c) ............................................ N.A. 311(a) ............................................ 7.10 (b) ............................................ 7.10 (c) ............................................ N.A. 312(a) ............................................ 2.05 (b) ............................................ 11.03 (c) ............................................ 11.03 313(a) ............................................ 7.05 (b) ............................................ 7.05 (c) ............................................ 11.02 (d) ............................................ 7.05 314(a) ............................................ 4.02; 11.02 (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) ............................................ 7.01 (b) ............................................ 7.04; 11.02 [(c) ............................................ 7.01] [(d) ............................................ 7.01] (e) ............................................ 6.11 316 (a)(last sentence) ................................ 2.08 (a)(1)(A) ........................................ 6.05 (a)(1)(B) ........................................ 6.04 (a)(2) ............................................ N.A. (b) ............................................ 6.07 317(a)(1) ............................................ 6.08 (a)(2) ............................................ 6.09 (b) ............................................ 2.04 318(a) ............................................ 11.01 N.A. means Not Applicable. _______________ * Note: This Cross Reference Table shall not, for any purpose, be deemed to be part of the Indenture. INDENTURE, dated as of _________, 1996, between JACOR COMMUNICATIONS, INC., a Delaware corporation ("COMPANY"), and The Bank of New York, a New York banking corporation, as trustee (the "TRUSTEE"). Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Company's Liquid Yield OptionTM Notes due 2011 (Zero Coupon -- Senior) (the "SECURITIES"): ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.01. DEFINITIONS. "AFFILIATE" of any specified person means any other person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified person. For the purposes of this definition, "CONTROL", when used with respect to any specified person, means the power to direct or cause the direction of the management and policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "CONTROLLING" and "CONTROLLED" have meanings correlative to the foregoing. "AUTHORIZED NEWSPAPER" means a newspaper, printed in the English language or in an official language of the country of publication, customarily published on each Business Day, whether or not published on Saturdays, Sundays or holidays, and of general circulation in each place in connection with which the term is used or in the financial community of each such place. Whenever successive publications are required to be made in Authorized Newspapers, the successive publications may be made in the same or in different Authorized Newspapers in the same city meeting the foregoing requirements and in each case on any Business Day. "BANKRUPTCY LAW" means Title 11, United States Code, or any similar Federal or state law for the relief of debtors. "BOARD OF DIRECTORS" or "BOARD" means, with respect to any matter, either the board of directors of the Company or any committee of such board duly authorized, with respect to such matter, to exercise the powers of such board. - ------------------- TM Trademark of Merrill Lynch & Co., Inc. "BUSINESS DAY" means each day of the year on which banking institutions in The City of New York are not required or authorized to close. "CAPITALIZED LEASE OBLIGATIONS" of any person means the obligations of such person to pay rent or other amounts under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP, and the amount of such obligation shall be the capitalized amount thereof determined in accordance with GAAP. "CAPITAL STOCK" for any corporation means any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) capital stock issued by that corporation. "CASH" or "CASH" means such coin or currency of The United States of America as at any time of payment is legal tender for the payment of public and private debts. "COMMON STOCK" means the Common Stock, par value $.01 per share, of the Company as it exists on the date of this Indenture or any other shares of capital stock of the Company into which such common stock shall be reclassified or changed. "COMPANY" means the party named as the "Company" in the first paragraph of this Indenture until a successor replaces it pursuant to the applicable provisions of this Indenture and, thereafter, shall mean such successor. The foregoing sentence shall likewise apply to any subsequent such successor or successors. "COMPANY REQUEST" or "COMPANY ORDER" means a written request or order signed in the name of the Company by either of its Chairman or Vice Chairman of the Board, its President, any Vice President, its Treasurer, or any Assistant Treasurer, and by its Secretary or an Assistant Secretary, and delivered to the Trustee. "CONSOLIDATED NET ASSETS" means the total amount of assets of the Company and its Subsidiaries (less applicable depreciation, amortization and other valuation reserves), after deducting therefrom all current liabilities of the Company and its Subsidiaries (other than intercompany liabilities and the current portion of long-term debt and Capitalized Lease Obligations), all as set forth on the latest consolidated balance sheet of the Company prepared in accordance with GAAP. "CONSOLIDATED SUBSIDIARY" means, at any date, any Subsidiary the accounts of which are consolidated with those of the Company as of such date for public financial reporting purposes. 2 "CUSTODIAN" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law. "DEFAULT" means any event that is, or after notice or passage of time or both would be, an Event of Default. "GAAP" means generally accepted accounting principles in the United States as in effect on the date hereof. "HOLDER" or "SECURITYHOLDER" means a person in whose name a Security is registered on the Registrar's books. "INDENTURE" means this Indenture as amended or supplemented from time to time in accordance with the terms hereof, including the provisions of the TIA that are deemed to be a part hereof. "ISSUE DATE" of any Security means the date on which the Security was originally issued or deemed issued as set forth on the face of the Security. "ISSUE PRICE" of any Security means, in connection with the original issuance of such Security, the initial issue price at which the Security is sold as set forth on the face of the Security. "NASDAQ" means the National Association of Securities Dealers Automated Quotation System. "OFFICER" means either Chairman or Vice Chairman of the Board, the President, any Vice President, the Treasurer, the Secretary, any Assistant Treasurer or Assistant Secretary of the Company. "OFFICERS' CERTIFICATE" means a written certificate containing the information specified in Sections 11.04 and 11.05, (i) signed in the name of the Company by either its Chairman of the Board, Vice Chairman of the Board, President, any Vice President, Treasurer, any Assistant Treasurer, Controller, or any Assistant Controller, and (ii) attested to by its Secretary or any Assistant Secretary, and delivered to the Trustee. "OPINION OF COUNSEL" means a written opinion containing the information specified in Sections 11.04 and 11.05, if applicable, rendered by legal counsel who may be (i) an employee of, or counsel to, the Company or (ii) other counsel designated by the Company and reasonably acceptable to the Trustee. 3 "ORIGINAL ISSUE DISCOUNT" of any Security means the difference between the Issue Price and the Principal Amount of the Security as set forth on the face of the Security. "PERSON" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "PRINCIPAL" or "PRINCIPAL AMOUNT" of a Security means the principal amount due at the Stated Maturity of the Security as set forth on the face of the Security. "PRINCIPAL PROPERTY" means (i) a parcel of improved or unimproved real estate or other physical facility or depreciable asset of the Company or a Subsidiary, the net book value of which on the date of determination exceeds 2% of Consolidated Net Assets and (ii) any group of parcels of real estate, other physical facilities, and/or depreciable assets of the Company and/or its Subsidiaries, the net book value of which, when sold in one or a series of related Sale and Lease-Back Transactions or securing debt issued in respect of such Principal Properties, on the date of determination exceeds 2% of the Consolidated Net Assets. For purposes of the foregoing, "related Sale and Lease-back Transactions" refers to any two or more such contemporaneous transactions which are on substantially similar terms with substantially the same parties. "REDEMPTION DATE" or "REDEMPTION DATE" shall mean the date specified for redemption of any of the Securities in accordance with the terms of the Securities and this Indenture. "REDEMPTION PRICE" or "REDEMPTION PRICE" shall have the meaning set forth in paragraph 5 of the Securities. "SALE AND LEASE-BACK TRANSACTIONS" means any arrangement with any lessor (other than the Company), providing for the leasing to the Company or a Restricted Subsidiary for a period of more than three years (including renewals at the option of the lessee) of any Principal Property that has been or is to be sold or transferred by the Company or such Restricted Subsidiary to such lessor or to any other person, to which funds have been or are to be advanced by such lessor or other person on the security of the leased property. "SALE PRICE" of a single share of Common Stock on any date means the closing per share sale price (or if no closing sale price is reported, the average of the bid and ask prices or, if more than one in either case the average of the average bid and the average ask prices) on such date as reported in composite 4 transactions for the principal United States securities exchange on which the Common Stock is traded or, if the Common Stock is not listed on a United States national or regional stock exchange, as reported by the National Association of Securities Dealers Automated Quotation System. "SEC" means the Securities and Exchange Commission. "SECURITIES" means any of the Company's Liquid Yield OptionTM Notes due 2011 (Zero Coupon -- Senior), as amended or supplemented from time to time in accordance with the terms hereof, issued under this Indenture. "SECURITYHOLDER" or "HOLDER" means a person in whose name a Security is registered on the Registrar's books. "STATED MATURITY", when used with respect to any Security, means the date specified in such Security as the fixed date on which the Principal of such Security is due and payable. "SUBSIDIARY" means (i) a corporation, a majority of whose Capital Stock with voting power, under ordinary circumstances, to elect directors is, at the date of determination, directly or indirectly owned by the Company, by one or more subsidiaries of the Company or by the Company and one or more subsidiaries of the Company, (ii) a partnership in which the Company or a subsidiary of the Company holds a majority interest in the equity capital or profits of such partnership, or (iii) any other person (other than a corporation) in which the Company, a subsidiary of the Company or the Company and one or more subsidiaries of the Company, directly or indirectly, at the date of determination, has (x) at least a majority ownership interest or (y) the power to elect or direct the election of a majority of the directors or other governing body of such person. "TIA" means the Trust Indenture Act of 1939, as amended by the Trust Indenture Reform Act of 1990, and as in effect on the date of this Indenture, except as provided in Section 9.03. "TRADING DAY" means each day on which the securities exchange or quotation system which is used to determine the Sale Price is open for trading or quotation. "TRUST OFFICER" means any officer of the Trustee assigned by the Trustee to administer its corporate trust matters. "TRUSTEE" means the party named as the "Trustee" in the first paragraph of this Indenture until a successor replaces it 5 pursuant to the applicable provisions of this Indenture and, thereafter, shall mean such successor. SECTION 1.02. OTHER DEFINITIONS. Defined in Term Section ----- ------------ "AGENT MEMBERS" ................................................ 2.01(a) "ASSOCIATE" .................................................... 3.09(a) "AVERAGE SALE PRICE" ........................................... 10.01 "BANKRUPTCY LAW" ............................................... 6.01 "BENEFICIAL OWNER" ............................................. 3.09(a) "CAPITALIZED LEASE OBLIGATIONS"................................. 6.01 "CHANGE IN CONTROL" ............................................ 3.09(a) "CHANGE IN CONTROL PURCHASE DATE" .............................. 3.09(a) "CHANGE IN CONTROL PURCHASE NOTICE"............................. 3.09(c) "CHANGE IN CONTROL PURCHASE PRICE" ............................. 3.09(a) "COMPANY NOTICE" ............................................... 3.08(e) "COMPANY NOTICE DATE" .......................................... 3.08(e) "CONSOLIDATED NET ASSETS"....................................... 6.01 "CONVERSION AGENT" ............................................. 2.03 "CONVERSION DATE" .............................................. 10.02 "CONVERSION RATE" .............................................. 10.01 "CUSTODIAN" .................................................... 6.01 "EVENT OF DEFAULT" ............................................. 6.01 "EXCHANGE ACT" ................................................. 3.08(d) "EX-DIVIDEND TIME" ............................................. 10.01 "EXTRAORDINARY CASH DIVIDEND" .................................. 10.08 "GAAP".......................................................... 6.01 "LEGAL HOLIDAY" ................................................ 11.08 "MARKET PRICE" ................................................. 3.08(d) "NOTICE OF DEFAULT" ............................................ 6.01 "OPTION"........................................................ 2.02 "PAYING AGENT".................................................. 2.03 "PRINCIPAL PROPERTY"............................................ 6.01 "PURCHASE DATE" ................................................ 3.08(a) "PURCHASE NOTICE" .............................................. 3.08(a) "PURCHASE PRICE" ............................................... 3.08(a) "REGISTRAR" .................................................... 2.03 "SALE AND LEASE-BACK TRANSACTIONS".............................. 6.01 "SECURITIES ACT" ............................................... 3.08(d) "TIME OF DETERMINATION" ........................................ 10.01 SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. Whenever this Indenture refers to a provision of the TIA, such provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings: 6 "COMMISSION" means the SEC. "INDENTURE SECURITIES" means the Securities. "INDENTURE SECURITY HOLDER" means a Securityholder. "INDENTURE TO BE QUALIFIED" means this Indenture. "INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee. "OBLIGOR" on the indenture securities means the Company. All other TIA terms used in this Indenture that are defined by the TIA or defined by TIA reference to another statute or regulation have the meanings assigned to them by such definitions. 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 generally accepted accounting principles as in effect from time to time in The United States of America; (3) "or" is not exclusive; (4) "including" means including, without limitation; and (5) words in the singular include the plural, and words in the plural include the singular. ARTICLE 2 THE SECURITIES SECTION 2.01. FORM AND DATING. The Securities and the Trustee's certificate of authentication shall be substantially in the form of Exhibit A, which is a part of this Indenture. The Securities may have notations, legends or endorsements required by law, stock exchange rule or usage (provided that any such notation, legend or endorsement required by usage is in a form acceptable to the Company and the Trustee). Each Security shall be dated the date of its authentication. 7 The Securities are being offered and sold by the Company pursuant to a Purchase Agreement, dated ______, 1996, between the Company and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated (the "Purchase Agreement"). SECTION 2.02. EXECUTION AND AUTHENTICATION. The Securities shall be executed by the Company by either of its Chairman or Vice Chairman of the Board, its President or one of its Vice Presidents, under its corporate seal reproduced thereon attested by its Secretary or one of its Assistant Secretaries. The signature of any of these officers on the Securities may be manual or facsimile. Securities bearing the manual or facsimile signatures of individuals who were at any time the proper Officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the Issue Date of such Securities. No Security shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication substantially in the form provided for herein duly executed by the Trustee by manual signature of an authorized signatory, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder. The Trustee shall authenticate and deliver Securities for original issue in an aggregate Principal Amount of up to $225,000,000 upon a Company Order without any further action by the Company; PROVIDED, HOWEVER, that in the event that the Company sells any Securities pursuant to the option (the "OPTION") granted pursuant to Section 2 of the Purchase Agreement, dated ______, 1996, between the Company and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, then the Trustee shall authenticate and deliver Securities for original issue in an aggregate Principal Amount of up to $225,000,000 plus up to $33,750,000 aggregate Principal Amount of Securities sold pursuant to the Option upon a Company Order. The aggregate Principal Amount of Securities outstanding at any time may not exceed the amount set forth in the foregoing sentence, subject to the proviso set forth therein, except as provided in Section 2.07. The Securities shall be issued only in registered form without coupons and only in denominations of $1,000 Principal Amount and only integral multiples thereof. 8 SECTION 2.03. REGISTRAR, PAYING AGENT AND CONVERSION AGENT. The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange ("REGISTRAR"), an office or agency where Securities may be presented for purchase or payment ("PAYING AGENT") and an office or agency where Securities may be presented for conversion ("CONVERSION AGENT"). The Registrar shall keep a register of the Securities and of their transfer and exchange. The Company may have one or more co-registrars, one or more additional paying agents and one or more additional conversion agents. The term Paying Agent includes any additional paying agent. The term Conversion Agent includes any additional conversion agent. The Company shall enter into an appropriate agency agreement with any Registrar, Paying Agent, Conversion Agent or co-registrar other than the Trustee. The agreement shall implement the provisions of this Indenture that relate to such agent. The Company shall notify the Trustee and the Holders of the name and address of any such agent and of any change in the office or agency referred to in Section 4.05. If the Company fails to maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.06. The Company or any Subsidiary or an Affiliate of either of them may act as Paying Agent, Registrar, Conversion Agent or co-registrar. The Company initially appoints the Trustee as Registrar, Conversion Agent and Paying Agent in connection with the Securities. SECTION 2.04. PAYING AGENT TO HOLD MONEY AND SECURITIES IN TRUST. In accordance with Section 4.05 and except as otherwise provided herein, prior to or on each due date of payments in respect of any Security, the Company shall deposit with the Paying Agent a sum of money or, if permitted by the terms hereof, securities sufficient to make such payments when so becoming due. The Company shall require each Paying Agent (other than the Trustee) to agree in writing that the Paying Agent shall hold in trust for the benefit of Securityholders or the Trustee all money and securities held by the Paying Agent for the making of payments in respect of the Securities and shall notify the Trustee of any default by the Company in making any such payment. At any time during the continuance of any default by the Company in making any payments in respect of the Securities, the Paying Agent shall, upon the written request of the Trustee, forthwith pay to the Trustee all money and securities so held in trust. If the Company, a Subsidiary or an Affiliate of either of them acts as Paying Agent, it shall segregate the money and securities held by it as Paying Agent and hold it as a separate trust fund. The Company at any time may require a Paying Agent to pay all money 9 and securities held by it to the Trustee and to account for any money and securities disbursed by it. Upon doing so, the Paying Agent shall have no further liability for the money and securities. SECTION 2.05. SECURITYHOLDER 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 Securityholders. If the Trustee is not the Registrar, the Company shall furnish or cause to be furnished to the Trustee (i) at least semiannually on June 1 and December 1 a list of the names and addresses of Securityholders dated within 15 days of the date on which the list is furnished and (ii) 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 Securityholders. SECTION 2.06. TRANSFER AND EXCHANGE. (a) Upon surrender for registration of transfer of any Security, together with a written instrument of transfer satisfactory to the Trustee duly executed by the Securityholder or such Securityholder's attorney duly authorized in writing, at the office or agency of the Company designated as Registrar or co-registrar pursuant to Section 2.03 or at the office or agency referred to in Section 4.05, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities of any authorized denomination or denominations, of a like aggregate Principal Amount. The Company shall not charge a service charge for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to pay all taxes, assessments or other governmental charges that may be imposed in connection with the transfer or exchange of the Securities from the Securityholder requesting such transfer or exchange (other than any exchange of a temporary Security for a definitive Security not involving any change in ownership). At the option of the Holder, Securities may be exchanged for other Securities of any authorized denomination or denominations, of a like aggregate Principal Amount, upon surrender of the Securities to be exchanged, together with a written instrument of transfer satisfactory to the Registrar duly executed by the Securityholder or such Securityholder's attorney duly authorized in writing, at such office or agency. Whenever any Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive. The Company shall not be required to make, and the Registrar need not register, transfers or exchanges of (a) Securities 10 selected for redemption (except, in the case of Securities to be redeemed in part, the portion thereof not to be redeemed), (b) any Securities in respect of which a Purchase Notice or a Change in Control Purchase Notice has been given and not withdrawn by the Holder thereof in accordance with the terms of this Indenture (except, in the case of Securities to be purchased in part, the portion thereof not to be purchased) or (c) any Securities for a period of 15 days before a selection of Securities to be redeemed. (b) Successive registrations and registrations of transfers and exchanges as aforesaid may be made from time to time as desired, and each such registration shall be noted on the register for the Securities. (c) Any Registrar appointed pursuant to Section 2.03 hereof shall provide to the Trustee such information as the Trustee may reasonably require in connection with the delivery by such Registrar of Securities upon transfer or exchange of Securities. (d) No Registrar shall be required to make registrations of transfer or exchange of Securities during any periods designated in the text of the Securities or in this Indenture as periods during which such registration of transfers and exchanges need not be made. SECTION 2.07. REPLACEMENT SECURITIES. If (a) any mutilated Security is surrendered to the Company or the Trustee, or (b) the Company and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any Security, and there is delivered to the Company and the Trustee such security or indemnity as may be required by them to save each of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a BONA FIDE purchaser, the Company shall execute, and upon its written request the Trustee shall authenticate and deliver, in exchange for any such mutilated Security or in lieu of any such destroyed, lost or stolen Security, a new Security of like tenor and Principal Amount, bearing a number not contemporaneously outstanding. In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, or is about to be purchased by the Company pursuant to Article 3 hereof, the Company in its discretion may, instead of issuing a new Security, pay or purchase such Security, as the case may be. Upon the issuance of any new Securities under this Section, the Company may require the payment of a sum sufficient to cover 11 any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) in connection therewith. Every new Security issued pursuant to this Section in lieu of any mutilated, destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately with any and all other Securities duly issued hereunder. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities. SECTION 2.08. OUTSTANDING SECURITIES; DETERMINATIONS OF HOLDERS' ACTION. Securities outstanding at any time are all the Securities authenticated by the Trustee except for those cancelled by it, those delivered to it for cancellation, mutilated, destroyed, lost or stolen Securities for which the Trustee has authenticated and delivered a new Security in lieu therefor pursuant to Section 2.07, those paid pursuant to Section 2.07 and those described in this Section 2.08 as not outstanding. A Security does not cease to be outstanding because the Company or an Affiliate thereof holds the Security; PROVIDED, HOWEVER, that in determining whether the Holders of the requisite Principal Amount of Securities have given or concurred in any request, demand, authorization, direction, notice, consent or waiver hereunder, Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or such other obligor shall be disregarded and deemed not to be outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Securities which the Trustee actually knows to be so owned shall be so disregarded. Subject to the foregoing, only Securities outstanding at the time of such determination shall be considered in any such determination (including, without limitation, determinations pursuant to Articles 6 and 9). If a Security is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Security is held by a bona fide purchaser. If the Paying Agent holds, in accordance with this Indenture, on a Redemption Date, or on the Business Day following a Purchase Date or a Change in Control Purchase Date, or on 12 Stated Maturity, money or, if permitted by the terms hereof including, without limitation, Section 3.08, securities sufficient to pay the Securities payable on that date, then on and after that date such Securities shall cease to be outstanding and Original Issue Discount and interest, if any, on such Securities shall cease to accrue and all other rights of the Holder shall terminate (other than the right to receive the applicable Redemption Price, Purchase Price or Change in Control Purchase Price, as the case may be, upon delivery of the Security in accordance with the terms of this Indenture); PROVIDED, that if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made. If a Security is converted in accordance with Article 10, then from and after the Conversion Date such Security shall cease to be outstanding and Original Issue Discount and interest, if any, shall cease to accrue on such Security. SECTION 2.09. TEMPORARY SECURITIES. Pending the preparation of definitive Securities, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Securities which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the Officers executing such Securities may determine, as conclusively evidenced by their execution of such Securities. If temporary Securities are issued, the Company will cause definitive Securities to be prepared without unreasonable delay. After the preparation of definitive Securities, the temporary Securities shall be exchangeable for definitive Securities upon surrender of the temporary Securities at the office or agency of the Company designated for such purpose pursuant to Section 2.03 or 4.05, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like Principal Amount of definitive Securities of authorized denominations. Until so exchanged the temporary Securities shall in all respects be entitled to the same benefits under this Indenture as definitive Securities. SECTION 2.10. CANCELLATION. All Securities surrendered for payment, redemption or purchase by the Company pursuant to Article 3, conversion pursuant to Article 10, registration of transfer or exchange shall, if surrendered to any person other than the Trustee, be delivered to the Trustee and shall be 13 promptly cancelled by it. The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated and delivered hereunder which the Company may have acquired in any manner whatsoever, and all Securities so delivered shall be promptly cancelled by the Trustee. The Company may not issue new Securities to replace Securities it has paid or delivered to the Trustee for cancellation or that any Holder has converted pursuant to Article 10. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of by the Trustee in accordance with its standard procedures and evidence of such disposition shall be delivered to the Company unless the Company directs by Company Order that the Trustee deliver cancelled Securities to the Company. SECTION 2.11. CUSIP NUMBERS. The Company in issuing the Securities may use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to Holders; PROVIDED that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any change in the CUSIP numbers. ARTICLE 3 REDEMPTION AND PURCHASES SECTION 3.01. RIGHT TO REDEEM; NOTICES TO TRUSTEE. The Company, at its option, may redeem the Securities for cash in accordance with the provisions set forth in paragraphs 5 and 7 of the Securities. If the Company elects to redeem Securities pursuant to paragraph 5 of the Securities, it shall notify the Trustee in writing of the Redemption Date, the Principal Amount of Securities to be redeemed and the Redemption Price. The Company shall give the notice to the Trustee provided for in this Section 3.01 at least 45 days but not more than 60 days before the Redemption Date (unless a shorter notice shall be satisfactory to the Trustee). If fewer than all the Securities are to be redeemed, the record date relating to such redemption shall be selected by the Company and given to the Trustee, which 14 record date shall not be less than ten days after the date of notice to the Trustee. SECTION 3.02. SELECTION OF SECURITIES TO BE REDEEMED. If less than all the Securities are to be redeemed, the Trustee shall select the Securities to be redeemed PRO RATA or by lot or by any other method the Trustee considers fair and appropriate (so long as such method is not prohibited by the rules of any stock exchange on which the Securities are then listed). The Trustee shall make the selection at least 30 but not more than 60 days before the Redemption Date from outstanding Securities not previously called for redemption. The Trustee may select for redemption portions of the Principal Amount of Securities that have denominations larger than $1,000. Securities and portions of them the Trustee selects shall be in Principal Amounts of $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption. The Trustee shall notify the Company promptly of the Securities or portions of Securities to be redeemed. If any Security selected for partial redemption is thereafter surrendered for conversion in part before termination of the conversion right with respect to the portion of the Security so selected, the converted portion of such Security shall be deemed (so far as may be), solely for purposes of determining the aggregate Principal Amount of Securities to be redeemed by the Company, to be the portion selected for redemption. Securities that have been converted during a selection of Securities to be redeemed may be treated by the Trustee as outstanding for the purpose of such selection. Nothing in this Section 3.02 shall affect the right of any Holder to convert any Security pursuant to Article 10 before the termination of the conversion right with respect thereto. SECTION 3.03. NOTICE OF REDEMPTION. At least 30 days but not more than 60 days before a Redemption Date, the Trustee, in the name and at the expense of the Company, shall cause notice of redemption to be mailed, first-class postage prepaid, to each Holder of Securities to be redeemed at his address as it appears on the list of Securityholders maintained pursuant to Section 2.05. The Trustee may, in its discretion, in the name and at the expense of the Company, cause a similar notice to be published at least once in an Authorized Newspaper in each place of payment. The notice shall identify the Securities to be redeemed and shall state: (1) the Redemption Date (upon which the Redemption Price shall be paid); 15 (2) the Redemption Price; (3) the Conversion Rate; (4) the name and address of the Paying Agent and Conversion Agent and of the office or agency referred to in Section 4.05; (5) that Securities called for redemption may be converted at any time before the close of business on the Redemption Date; (6) that Holders who want to convert Securities must satisfy the requirements set forth in paragraph 8 of the Securities; (7) that Securities called for redemption must be surrendered to the Paying Agent or at the office or agency referred to in Section 4.05 to collect the Redemption Price; (8) the CUSIP number of the Securities; (9) if fewer than all the outstanding Securities are to be redeemed, the certificate numbers and Principal Amounts of the particular Securities to be redeemed; and (10) that, unless the Company defaults in payment of the Redemption Price, Original Issue Discount on Securities called for redemption and interest, if any, will cease to accrue on and after the Redemption Date. At the Company's written request, the Trustee shall give the notice of redemption in the Company's name and at the Company's expense, provided that the Company makes such request at least three Business Days prior to such notice of redemption. SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION. Once notice of redemption is given, Securities called for redemption become due and payable on the Redemption Date stated in the notice and at the Redemption Price therefor except for Securities that are converted in accordance with the terms of this Indenture. Upon the later of the Redemption Date and the date such Securities are surrendered to the Paying Agent or at the office or agency referred to in Section 4.05, such Securities called for redemption shall be paid at the Redemption Price therefor. SECTION 3.05. DEPOSIT OF REDEMPTION PRICE. Prior to or on the Redemption Date, the Company shall deposit with the Paying Agent (or if the Company or a Subsidiary or an Affiliate of either of them is the Paying Agent, shall segregate and hold in 16 trust) money sufficient to pay the Redemption Price of all Securities to be redeemed on that date other than Securities or portions of Securities called for redemption which prior thereto have been delivered by the Company to the Trustee for cancellation. The Paying Agent shall as promptly as practicable return to the Company any money, with interest, if any, thereon (subject to the provisions of Section 7.01(f)), not required for that purpose because of conversion of Securities pursuant to Article 10. If such money is then held by the Company or a Subsidiary or an Affiliate of the Company in trust and is not required for such purpose it shall be discharged from such trust. SECTION 3.06. SECURITIES REDEEMED IN PART. Upon surrender of a Security that is redeemed in part, the Company shall execute, and the Trustee shall authenticate and deliver to the Holder, a new Security in an authorized denomination equal in Principal Amount to the unredeemed portion of the Security surrendered. SECTION 3.07. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION. In connection with any redemption of Securities, the Company may arrange, in lieu of redemption, for the purchase and conversion of any Securities called for redemption by an agreement with one or more investment bankers or other purchasers to purchase all or a portion of such Securities by paying to the Trustee in trust for the Securityholders whose Securities are to be so purchased, on or before the close of business on the Redemption Date, an amount that, together with any amounts deposited with the Trustee by the Company for redemption of such Securities, is not less than the Redemption Price, together with interest, if any, accrued to the Redemption Date, of such Securities. Notwithstanding anything to the contrary contained in this Article 3, the obligation of the Company to pay the Redemption Price of such Securities, including all accrued interest, if any, shall be deemed to be satisfied and discharged to the extent such amount is so paid by such purchasers, but no such agreement shall relieve the Company of its obligation to pay such Redemption Price and interest, if any. If such an agreement is entered into, any Securities not duly surrendered for conversion by the Holders thereof may, at the option of the Company, be deemed, to the fullest extent permitted by law, acquired by such purchasers from such Holders and (notwithstanding anything to the contrary contained in Article 10) surrendered by such purchasers for conversion, all as of immediately prior to the close of business on the Redemption Date, subject to payment of the above amount as aforesaid. The Trustee shall hold and pay to the Holders whose Securities are selected for redemption any such amount paid to it for purchase and conversion in the same manner as it would moneys deposited with it by the Company for the redemption of Securities. Without 17 the Trustee's prior written consent, no arrangement between the Company and such purchasers for the purchase and conversion of any Securities shall increase or otherwise affect any of the powers, duties, responsibilities or obligations of the Trustee as set forth in this Indenture, and the Company agrees to indemnify the Trustee from, and hold it harmless against, any loss, liability or expense arising out of or in connection with any such arrangement for the purchase and conversion of any Securities between the Company and such purchasers, including the costs and expenses incurred by the Trustee in the defense of any claim or liability arising out of or in connection with the exercise or performance of any of its powers, duties, responsibilities or obligations under this Indenture. SECTION 3.08. PURCHASE OF SECURITIES AT THE OPTION OF THE HOLDER. (a) GENERAL. Securities shall be purchased by the Company pursuant to paragraph 6 of the Securities as of ______, 2001 and ______, 2006 (each, a "PURCHASE DATE"), at the purchase price specified therein (each, a "PURCHASE PRICE"), at the option of the Holder thereof, upon: (1) delivery to the Paying Agent or to the office or agency referred to in Section 4.05 by the Holder of a written notice of purchase (a "PURCHASE NOTICE") at any time from the opening of business on the date that is 20 Business Days prior to a Purchase Date until the close of business on such Purchase Date stating: (A) the certificate number of the Security that the Holder will deliver to be purchased; (B) the portion of the Principal Amount of the Security which the Holder will deliver to be purchased, which portion must be $1,000 or an integral multiple thereof; (C) that such Security shall be purchased on the Purchase Date pursuant to the terms and conditions specified in this Indenture and in paragraph 6 of the Securities; and (D) if the Company elects pursuant to Section 3.08(b) to pay the Purchase Price on such Purchase Date, in whole or in part, in shares of Common Stock, but such portion of the Purchase Price to be paid in Common Stock is ultimately to be paid in cash because any condition in Section 3.08(d) is not satisfied, such Holder elects (i) to withdraw such Purchase Notice as to some or all of the Securities to which it relates (stating the Principal Amount and certificate numbers 18 of the Securities as to which such withdrawal shall relate), or (ii) to receive cash in respect of the Purchase Price for all Securities subject to such Purchase Notice; and (2) delivery of such Security prior to, on or after the Purchase Date (together with all necessary endorsements) to the Paying Agent at the offices of the Paying Agent or to the office or agency referred to in Section 4.05, such delivery being a condition to receipt by the Holder of the Purchase Price therefor; PROVIDED, HOWEVER, that such Purchase Price shall be so paid pursuant to this Section 3.08 only if the Security so delivered conforms in all respects to the description thereof in the related Purchase Notice. If a Holder, in such Holder's Purchase Notice and in any written notice of withdrawal delivered by such Holder pursuant to the terms of Section 3.10, fails to indicate such Holder's choice with respect to the election set forth in clause (D) of Section 3.08(a)(1) above, such Holder shall be deemed to have elected to receive cash in respect of the Purchase Price otherwise payable in Common Stock. The Company shall purchase from the Holder thereof, pursuant to this Section 3.08, a portion of a Security if the Principal Amount of such portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to the purchase of all of a Security also apply to the purchase of such portion of such Security. Any purchase by the Company contemplated pursuant to the provisions hereof shall be consummated by the delivery of the consideration to be received by the Holder promptly following the later of the Purchase Date and the time of delivery of the Security. Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent or the office or agency referred to in Section 4.05 the Purchase Notice contemplated by this Section 3.08(a) shall have the right to withdraw at any time prior to the close of business on the Purchase Date such Purchase Notice by delivery of a written notice of withdrawal to the Paying Agent or such office or agency in accordance with Section 3.10. The Paying Agent shall promptly notify the Company of the receipt by it of any Purchase Notice or written notice of withdrawal thereof. 19 (b) COMPANY'S RIGHT TO ELECT MANNER OF PAYMENT OF PURCHASE PRICE. The Securities to be purchased pursuant to Section 3.08(a) may be paid for, at the election of the Company, in cash or Common Stock, or in any combination of cash and Common Stock, subject to the conditions set forth in this Section 3.08. The Company shall designate, in the notice from the Company delivered pursuant to Section 3.08(e), whether the Company will purchase the Securities for cash or Common Stock, and, if a combination thereof, the percentages of the Purchase Price of Securities in respect of which it will pay in cash or Common Stock; PROVIDED that the Company will pay cash for fractional interests in Common Stock. For purposes of determining the existence of potential fractional interests, all Securities subject to purchase by the Company held by a Holder shall be considered together (no matter how many separate certificates are to be presented). Each Holder whose Securities are purchased pursuant to this Section 3.08 shall receive the same percentage of cash or Common Stock in payment of the Purchase Price for such Securities, except (i) as provided in Section 3.08(d) with regard to the payment of cash in lieu of fractional shares of Common Stock and (ii) in the event that the Company is unable to purchase the Securities of a Holder or Holders for Common Stock because any necessary qualifications or registrations of the Common Stock under applicable state securities laws cannot be obtained, the Company may purchase the Securities of such Holder or Holders for cash. The Company may not change its election with respect to the consideration (or components or percentages of components thereof) to be paid once the Company has given notice thereof to Securityholders except pursuant to this Section 3.08(b) or Section 3.08(d). At least five Business Days before the Company Notice Date (as defined below), the Company shall deliver an Officers' Certificate to the Trustee specifying: (i) the manner of payment selected by the Company; (ii) the information required by Section 3.08(e); (iii) that the conditions to such manner of payment set forth in Section 3.08(d) have or will be complied with; and (iv) whether the Company desires the Trustee to give the notice required by Section 3.08(e). (c) PURCHASE WITH CASH. On each Purchase Date, at the option of the Company, the Principal Amount of the Securities in respect of which a Purchase Notice pursuant to Section 3.08(a) has been given, or a specified percentage thereof, may be purchased by the Company with cash equal to the aggregate Purchase Price of such Securities. 20 (d) PAYMENT BY COMMON STOCK. On each Purchase Date, at the option of the Company, the Principal Amount of the Securities in respect of which a Purchase Notice pursuant to Section 3.08(a) has been given, or a specified percentage thereof, may be purchased by the Company by the issuance of a number of shares of Common Stock equal to the quotient obtained by dividing (i) the amount of cash to which the Securityholders would have been entitled had the Company elected to pay all or such specified percentage, as the case may be, of the Purchase Price of such Securities in cash by (ii) the Market Price (as defined below) of a share of Common Stock, subject to the next succeeding paragraph. The Company will not issue a fractional share of Common Stock in payment of the Purchase Price. Instead the Company will pay cash for the current market value of the fractional share. The current market value of a fraction of a share shall be determined by multiplying the Market Price by such fraction and rounding the product to the nearest whole cent, with one-half cent being rounded upward. It is understood that if a Holder elects to have more than one Security purchased, the number of shares of Common Stock shall be based on the aggregate amount of Securities to be purchased. The Company's right to exercise its election to purchase the Securities pursuant to this Section through the issuance of shares of Common Stock shall be conditioned upon: (i) the Company's not having given notice of an election to pay entirely in cash and its giving of timely notice of election to purchase all or a specified percentage of the Securities with Common Stock as provided herein; (ii) the registration of the shares of Common Stock to be issued in respect of the payment of the Purchase Price under the Securities Act of 1933, as amended (the "SECURITIES ACT") and the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), in each case if required for the initial issuance thereof; (iii) any necessary qualification or registration under applicable state securities laws or the availability of an exemption from such qualification and registration; and (iv) the receipt by the Trustee of an Officers' Certificate and an Opinion of Counsel each stating that (A) the terms of the issuance of the Common Stock are in conformity with this Indenture and (B) the shares of Common Stock to be issued by the Company in payment of the Purchase Price in respect of Securities have been duly authorized 21 and, when issued and delivered pursuant to the terms of this Indenture in payment of the Purchase Price in respect of the Securities, will be validly issued, fully paid and nonassessable and shall be free of any preemptive rights and any lien or adverse claim (provided that such Opinion of Counsel may state that, insofar as it relates to the absence of such preemptive rights, liens and adverse claims, it is given upon the best knowledge of such counsel), and, in the case of such Officers' Certificate, that conditions (i), (ii) and (iii) above have been satisfied and, in the case of such Opinion of Counsel, that conditions (ii) and (iii) above have been satisfied. Such Officers' Certificate shall also set forth the number of shares of Common Stock to be issued for each $1,000 Principal Amount of Securities and the Sale Price of a share of Common Stock on each of the seven Business Days prior to the Purchase Date. The Company may elect to pay in Common Stock only if the information necessary to calculate the Market Price is reported in THE WALL STREET JOURNAL or another daily newspaper of national circulation. If such conditions are not satisfied prior to or on the Purchase Date and the Company elected to purchase the Securities pursuant to this Section 3.08 through the issuance of shares of Common Stock, the Company shall pay the Purchase Price in cash. The "MARKET PRICE" means the average of the Sale Price of the Common Stock for the five Trading Day period ending on the third Trading Day prior to the related Purchase Date, appropriately adjusted to take into account the actual occurrence, during the seven Trading Days preceding such Purchase Date, of any event described in Section 10.06, 10.07 or 10.08; SUBJECT, HOWEVER, to the conditions set forth in Sections 10.09 and 10.10. (e) NOTICE OF ELECTION. The Company shall send notices of its election (the "COMPANY NOTICE") to purchase with cash or Common Stock or any combination thereof to the Holders (and to beneficial owners as required by applicable law) in the manner provided in Section 3.03. The Company Notice shall be sent to Holders (and to beneficial owners as required by applicable law) on a date not less than 20 Business Days prior to the Purchase Date (such date not less than 20 Business Days prior to the Purchase Date being herein referred to as the "COMPANY NOTICE DATE"). Such notices shall state the manner of payment elected and shall contain the following information: In the event the Company has elected to pay the Purchase Price (or any specified percentage thereof) with Common Stock, the notice shall: 22 (1) state that each Holder will receive Common Stock with a Market Price determined as of a specified date prior to the Purchase Date equal to such specified percentage of the Purchase Price of the Securities held by such Holder (except for any cash amount to be paid in lieu of fractional shares); (2) set forth the method of calculating the Market Price of the Common Stock; and (3) state that because the Market Price of Common Stock will be determined prior to the Purchase Date, Holders will bear the market risk with respect to the value of the Common Stock to be received from the date such Market Price is determined to the Purchase Date. In any case, each notice shall include a form of Purchase Notice to be completed by the Securityholder and shall state: (i) the Purchase Price and Conversion Rate; (ii) the name and address of the Paying Agent and the Conversion Agent and of the office or agency referred to in Section 4.05; (iii) that Securities as to which a Purchase Notice has been given may be converted into Common Stock at any time prior to the close of business on the applicable Purchase Date only if the applicable Purchase Notice has been withdrawn in accordance with the terms of this Indenture; (iv) that Securities must be surrendered to the Paying Agent or to the office or agency referred to in Section 4.05 to collect payment; (v) that the Purchase Price for any security as to which a Purchase Notice has been given and not withdrawn will be paid promptly following the later of the Purchase Date and the time of surrender of such Security as described in (iv); (vi) the procedures the Holder must follow to exercise rights under Section 3.08 and a brief description of those rights; (vii) briefly, the conversion rights of the Securities and that Holders who want to convert Securities must satisfy the requirements set forth in paragraph 8 of the Securities; and 23 (viii) the procedures for withdrawing a Purchase Notice (including, without limitation, for a conditional withdrawal pursuant to the terms of Section 3.08(a)(1)(D) or Section 3.10). At the Company's written request, the Trustee shall give such notice in the Company's name and at the Company's expense; PROVIDED, HOWEVER, that, in all cases, the text of such notice shall be prepared by the Company. Upon determination of the actual number of shares of Common Stock to be issued for each $1,000 Principal Amount of Securities, the Company will publish such determination in THE WALL STREET JOURNAL or another daily newspaper of national circulation and furnish the Trustee with an affidavit of publication. (f) COVENANTS OF THE COMPANY. All shares of Common Stock delivered upon purchase of the Securities shall be newly issued shares or treasury shares, shall be duly authorized, validly issued, fully paid and nonassessable and shall be free from preemptive rights and free of any lien or adverse claim. The Company shall use its best efforts to list or cause to have quoted any shares of Common Stock to be issued to purchase Securities on the principal national securities exchange or over-the-counter or other domestic market on which any other shares of the Common Stock are then listed or quoted. The Company will promptly inform the Trustee in writing of any such listing. (g) PROCEDURE UPON PURCHASE. The Company shall deposit cash (in respect of a cash purchase under Section 3.08(c) or for fractional interests, as applicable) or shares of Common Stock, or any combination thereof, as applicable, at the time and in the manner as provided in Section 3.11, sufficient to pay the aggregate Purchase Price of all Securities to be purchased pursuant to this Section 3.08. As soon as practicable after the later of the Purchase Date and the date such Securities are surrendered to the Paying Agent or at the office or agency referred to in Section 4.05, the Company shall deliver to each Holder entitled to receive Common Stock through the Paying Agent a certificate for the number of full shares of Common Stock issuable in payment of the Purchase Price and cash in lieu of any fractional interests. The person in whose name the certificate for Common Stock is registered shall be treated as a holder of record of such Common Stock on the Business Day following the related Purchase Date. Subject to Section 3.08(d), no payment or adjustment will be made for dividends on the Common Stock the record date for which occurred prior to the Purchase Date. 24 (h) TAXES. If a Holder of a Security is paid in Common Stock, the Company shall pay any documentary, stamp or similar issue or transfer tax due on such issue of shares of Common Stock. However, the Holder shall pay any such tax which is due because the Holder requests the shares of Common Stock to be issued in a name other than the Holder's name. The Paying Agent may refuse to deliver the certificates representing the Common Stock being issued in a name other than the Holder's name until the Paying Agent receives a sum sufficient to pay any tax which will be due because the shares of Common Stock are to be issued in a name other than the Holder's name. Nothing herein shall preclude any income tax withholding required by law or regulations. SECTION 3.09. PURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON CHANGE IN CONTROL. (a) If on or prior to ______, 2001 there shall have occurred a Change in Control, Securities shall be purchased, at the option of the Holder thereof, by the Company at the purchase price specified in paragraph 6 of the Securities (the "CHANGE IN CONTROL PURCHASE PRICE"), on the date that is 35 Business Days after the occurrence of the Change of Control (the "CHANGE IN CONTROL PURCHASE DATE"), subject to satisfaction by or on behalf of the Holder of the requirements set forth in Section 3.09(c). A "CHANGE IN CONTROL" shall be deemed to have occurred at such time after the original issuance of the Securities as either of the following events shall occur: (i) There shall be consummated any consolidation or merger of the Company in which the Company is not the continuing or surviving corporation or pursuant to which the Common Stock would be converted into cash, securities or other property, other than a consolidation or merger of the Company in which the holders of Common Stock immediately prior to the consolidation or merger have, directly or indirectly, at least a majority of the Common Stock of the continuing or surviving corporation immediately after such consolidation or merger; or (ii) There is a report filed by any person, including its Affiliates and Associates, on Schedule 13D or 14D-1 (or any successor schedule, form or report) pursuant to the Exchange Act, disclosing that such person (for the purposes of this Section 3.09 only, the term "person" shall include a "person" within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision to either of the foregoing) has become the beneficial owner (as the term "BENEFICIAL OWNER" is defined under Rule 13d-3 or any successor rule or regulation promulgated under the 25 Exchange Act) of 50% or more of the voting power of the Company's Common Stock then outstanding; PROVIDED, HOWEVER, that a person shall not be deemed beneficial owner of, or to own beneficially, (A) any securities tendered pursuant to a tender or exchange offer made by or on behalf of such person or any of such person's Affiliates or Associates until such tendered securities are accepted for purchase or exchange thereunder, or (B) any securities if such beneficial ownership (1) arises solely as a result of a revocable proxy delivered in response to a proxy or consent solicitation made pursuant to, and in accordance with, the applicable rules and regulations under the Exchange Act, and (2) is not also then reportable on Schedule 13D (or any successor schedule, form or report) under the Exchange Act. Notwithstanding the foregoing provisions of this Section 3.09, a Change in Control shall not be deemed to have occurred if at any time the Company, any Subsidiary, any employee stock ownership plan or any other employee benefit plan of the Company or any Subsidiary, or any person holding Common Stock for or pursuant to the terms of any such employee benefit plan files or becomes obligated to file a report under or in response to Schedule 13D or Schedule 14D-1 (or any successor schedule, form or report) under the Exchange Act disclosing beneficial ownership by it of shares of Common Stock, whether in excess of 50% or otherwise. "ASSOCIATE" shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations under the Exchange Act, as in effect on the date hereof. (b) Within 15 Business Days after the occurrence of a Change in Control, (i) the Company shall mail a written notice of such Change in Control by first-class mail to the Trustee and to each Holder (and to beneficial owners if required by applicable law) and (ii) the Company shall cause a copy of such notice to be published in THE WALL STREET JOURNAL or another daily newspaper of national circulation. The notice shall include a form of Change in Control Purchase Notice to be completed by the Securityholder and shall state: (1) the events causing a Change in Control and the date such Change in Control is deemed to have occurred for purposes of this Section 3.09; (2) the date by which the Change in Control Purchase Notice pursuant to this Section 3.09 must be given; (3) the Change in Control Purchase Date; (4) the Change in Control Purchase Price; 26 (5) the name and address of the Paying Agent and the Conversion Agent and the office or agency referred to in Section 4.05; (6) the Conversion Rate and any adjustments thereto; (7) that Securities as to which a Change in Control Purchase Notice has been given may be converted into Common Stock (or, in lieu thereof, cash, if the Company shall so elect) at any time prior to the close of business on the Change of Control Purchase Date only if the Change in Control Purchase Notice has been withdrawn by the Holder in accordance with the terms of this Indenture; (8) that Securities must be surrendered to the Paying Agent or the office or agency referred to in Section 4.05 to collect payment; (9) that the Change in Control Purchase Price for any Security as to which a Purchase Notice has been duly given and not withdrawn will be paid promptly following the later of the Change in Control Purchase Date and the time of surrender of such Security as described in (8); (10) the procedures the Holder must follow to exercise rights under this Section 3.09 and a brief description of those rights; (11) briefly, the conversion rights of the Securities; and (12) the procedures for withdrawing a Change in Control Purchase Notice. (c) A Holder may exercise its rights specified in Section 3.09(a) upon delivery of a written notice of purchase (a "CHANGE IN CONTROL PURCHASE NOTICE") to the Paying Agent or to the office or agency referred to in Section 4.05 at any time prior to the close of business on the Change in Control Purchase Date, stating: (1) the certificate number of the Security which the Holder will deliver to be purchased; (2) the portion of the Principal Amount of the Security which the Holder will deliver to be purchased, which portion must be $1,000 or an integral multiple thereof; and 27 (3) that such Security shall be purchased on the Change in Control Purchase Date pursuant to the terms and conditions specified in paragraph 6 of the Securities. Receipt of the Security by the Paying Agent prior to, on or after the Change in Control Purchase Date (together with all necessary endorsements), at the offices of the Paying Agent or to the office or agency referred to in Section 4.05 shall be a condition to the receipt by the Holder of the Change in Control Purchase Price therefor; PROVIDED, HOWEVER, that such Change in Control Purchase Price shall be so paid pursuant to this Section 3.09 only if the Security so delivered to the Paying Agent or such office or agency shall conform in all respects to the description thereof set forth in the related Change in Control Purchase Notice. The Company shall purchase from the Holder thereof, pursuant to this Section 3.09, a portion of a Security if the Principal Amount of such portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to the purchase of all of a Security also apply to the purchase of such portion of such Security. Any purchase by the Company contemplated pursuant to the provisions of this Section 3.09 shall be consummated by the delivery of the consideration to be received by the Holder promptly following the later of the Change in Control Purchase Date and the date such Securities are surrendered to the Paying Agent or at the office or agency referred to in Section 4.05. Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent or to the office or agency referred to in Section 4.05 the Change in Control Purchase Notice contemplated by this Section 3.09(c) shall have the right to withdraw such Change in Control Purchase Notice at any time prior to or on the Change in Control Purchase Date by delivery of a written notice of withdrawal to the Paying Agent or to such office or agency in accordance with Section 3.10. The Paying Agent shall promptly notify the Company of the receipt by it of any Change in Control Purchase Notice or written withdrawal thereof. SECTION 3.10. EFFECT OF PURCHASE NOTICE OR CHANGE IN CONTROL PURCHASE NOTICE. Upon receipt by the Paying Agent of the Purchase Notice or Change in Control Purchase Notice specified in Section 3.08(a) or Section 3.09(c), as applicable, the Holder of the Security in respect of which such Purchase Notice or Change in Control Purchase Notice, as the case may be, was given shall (unless such Purchase Notice or Change in Control Purchase Notice 28 is withdrawn as specified in the following two paragraphs) thereafter be entitled to receive solely the Purchase Price or Change in Control Purchase Price, as the case may be, with respect to such Security. Such Purchase Price or Change in Control Purchase Price shall be paid to such Holder promptly following the later of (x) the Business Day following the Purchase Date or the Change in Control Purchase Date, as the case may be, with respect to such Security (provided the conditions in Section 3.08(a) or Section 3.09(c), as applicable, have been satisfied) and (y) the time of delivery of such Security to the Paying Agent or to the office or agency referred to in Section 4.05 by the Holder thereof in the manner required by Section 3.08(a) and (g) or Section 3.09(c), as applicable. Securities in respect of which a Purchase Notice or Change in Control Purchase Notice, as the case may be, has been given by the Holder thereof may not be converted into shares of Common Stock on or after the date of the delivery of such Purchase Notice or Change in Control Purchase Notice, as the case may be, unless such Purchase Notice or Change in Control Purchase Notice, as the case may be, has first been validly withdrawn as specified in the following two paragraphs. A Purchase Notice or Change in Control Purchase Notice, as the case may be, may be withdrawn by means of a written notice of withdrawal delivered to the office of the Paying Agent or to the office or agency referred to in Section 4.05 at any time on or prior to the Purchase Date or the Change in Control Purchase Date, as the case may be, specifying: (1) the certificate number of the Security in respect of which such notice of withdrawal is being submitted; (2) the Principal Amount of the Security with respect to which such notice of withdrawal is being submitted; and (3) the Principal Amount, if any, of such Security which remains subject to the original Purchase Notice or Change in Control Purchase Notice, as the case may be, and which has been or will be delivered for purchase by the Company. A written notice of withdrawal of a Purchase Notice may be in the form set forth in the preceding paragraph or may be in the form of (i) a conditional withdrawal contained in a Purchase Notice pursuant to the terms of Section 3.08(a)(1)(D) or (ii) a conditional withdrawal containing the information set forth in Section 3.08(a)(1)(D) and the preceding paragraph and contained in a written notice of withdrawal delivered to the Paying Agent as set forth in the preceding paragraph. 29 There shall be no purchase of any Securities pursuant to Sections 3.08 (other than through the issuance of Common Stock in payment of the Purchase Price, including cash in lieu of fractional shares of Common Stock) or 3.09 if there has occurred (prior to, on or after, as the case may be, the giving, by the Holders of such Securities, of the required Purchase Notice or Change in Control Purchase Notice, as the case may be) and is continuing an Event of Default (other than a default in the payment of the Purchase Price or Change in Control Purchase Price, as the case may be, with respect to such Securities). The Paying Agent will promptly return to the respective Holders thereof any Securities (x) with respect to which a Purchase Notice or Change in Control Purchase Notice, as the case may be, has been withdrawn in compliance with this Indenture, or (y) held by it during the continuance of an Event of Default (other than a default in the payment of the Purchase Price or Change in Control Purchase Price, as the case may be, with respect to such Securities) in which case, upon such return, the Purchase Notice or Change in Control Purchase Notice with respect thereto shall be deemed to have been withdrawn. SECTION 3.11. DEPOSIT OF PURCHASE PRICE OR CHANGE IN CONTROL PURCHASE PRICE. Prior to 3:00 p.m. (local time in The City of New York) on the Business Day following the Purchase Date or the Change in Control Purchase Date, as the case may be, the Company shall deposit with the Trustee or with the Paying Agent (or, if the Company or a Subsidiary or an Affiliate of either of them is acting as Paying Agent, shall segregate and hold in trust as provided in Section 2.04) an amount of cash in immediately available funds or securities, if expressly permitted hereunder, sufficient to pay the aggregate Purchase Price or Change in Control Purchase Price, as the case may be, of all the Securities or portions thereof which are to be purchased as of the Purchase Date or Change in Control Purchase Date, as the case may be. SECTION 3.12. SECURITIES PURCHASED IN PART. Any Security which is to be purchased only in part shall be surrendered at the office of the Paying Agent or the office or agency referred to in Section 4.05 (with, if the Company or the Trustee so requires, due endorsement, or a written instrument of transfer in form satisfactory to the Company and the Trustee executed by the Holder or such Holder's attorney duly authorized in writing) and the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Security, without service charge, a new Security or Securities, of any authorized denomination as requested by such Holder in aggregate Principal Amount equal to, and in exchange for, the portion of the Principal Amount of the Security so surrendered which is not purchased. 30 SECTION 3.13. COVENANT TO COMPLY WITH SECURITIES LAWS UPON PURCHASE OF SECURITIES. In connection with any offer to purchase or purchase of Securities under Section 3.08 or 3.09 hereof, the Company shall (i) comply with Rule 13e-4 and Rule 14e-1 under the Exchange Act, if applicable, (ii) file the related Schedule 13E-4 (or any successor schedule, form or report) under the Exchange Act, if applicable, and (iii) otherwise comply with all Federal and state securities laws regulating the offer and delivery of shares of Common Stock upon purchase of the Securities (including positions of the SEC under applicable no-action letters) so as to permit the rights and obligations under Sections 3.08 and 3.09 to be exercised in the time and in the manner specified in Sections 3.08 and 3.09. SECTION 3.14. REPAYMENT TO THE COMPANY. The Trustee and the Paying Agent shall return to the Company, upon written request, any cash or shares of Common Stock, together with interest on such cash, if any, or dividends on such shares of Common Stock, if any, (subject to the provisions of Section 7.01(f)) held by them for the payment of a Purchase Price or Change in Control Purchase Price, as the case may be, of the Securities that remain unclaimed as provided in paragraph 12 of the Securities; PROVIDED, HOWEVER, that to the extent that the aggregate amount of cash or shares of Common Stock deposited by the Company pursuant to Section 3.11 exceeds the aggregate Purchase Price or Change in Control Purchase Price, as the case may be, of the Securities or portions thereof to be purchased, then promptly after the Business Day following the Purchase Date or Change in Control Purchase Date, as the case may be, the Trustee shall return any such excess to the Company together with interest or dividends, if any, thereon (subject to the provisions of Section 7.01(f)). ARTICLE 4 COVENANTS SECTION 4.01. PAYMENT OF SECURITIES. The Company shall promptly make all payments in respect of the Securities on the dates and in the manner provided in the Securities or pursuant to this Indenture. Principal Amount, Issue Price, accrued Original Issue Discount, Redemption Price, Purchase Price, Change in Control Purchase Price and interest, if any, shall be considered paid on the applicable date due if on such date the Trustee or the Paying Agent holds, in accordance with this Indenture, cash or securities, if expressly permitted hereunder, sufficient to pay all such amounts then due. 31 The Company shall, to the extent permitted by law, pay interest on overdue amounts at the per annum rate of interest set forth in paragraph 1 of the Securities, compounded semi-annually, which interest on overdue amounts (to the extent payment of such interest shall be legally enforceable) shall accrue from the date such overdue amounts were originally due and payable. SECTION 4.02. SEC REPORTS. The Company shall file with the Trustee, within 15 days after it files such annual and quarterly reports, information, documents and other reports with the SEC, copies of its annual and quarterly reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) which the Company is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act (or any such successor provisions thereto). In the event the Company is at any time no longer subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act (or any such successor provisions), it shall continue to provide the Trustee with reports containing substantially the same information as would have been required to be filed with the SEC had the Company continued to have been subject to such reporting requirements, and the Trustee shall make any such reports available to Securityholders upon request. In such event, such reports shall be provided at the times the Company would have been required to provide reports had it continued to have been subject to such reporting requirements. The Company also shall comply with the other provisions of TIA Section 314(a), to the extent such provisions are applicable. SECTION 4.03. COMPLIANCE CERTIFICATE; NOTICE OF DEFAULTS. (a) The Company shall deliver to the Trustee within 120 days after the end of each fiscal year of the Company (beginning with the fiscal year ending on December 31, 1996) a certificate of the principal executive officer, the principal financial officer, the treasurer, any assistant treasurer or the controller or any assistant controller or principal accounting officer of the Company stating whether or not, to the knowledge of the signer, the Company has complied with all conditions and covenants on its part contained in this Indenture and, if the signer has obtained knowledge of any default by the Company in the performance, observance or fulfillment of any such condition or covenant, specifying each such default and the nature thereof. For the purpose of this Section 4.03, compliance shall be determined without regard to any grace period or requirement of notice provided pursuant to the terms of this Indenture. (b) The Company shall file with the Trustee written notice of the occurrence of any Default or Event of Default within five 32 Business Days of its becoming aware of such Default or Event of Default. SECTION 4.04. FURTHER INSTRUMENTS AND ACTS. Upon request of the Trustee, the Company will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purposes of this Indenture. SECTION 4.05. MAINTENANCE OF OFFICE OR AGENCY. The Company will maintain in the Borough of Manhattan, The City of New York, in such location as may be required by the rules of any securities exchange or quotation system on which the Securities may from time to time be listed, an office or agency where Securities may be presented or surrendered for payment, where Securities may be surrendered for registration of transfer, exchange, purchase, redemption or conversion and where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. The office of the Trustee in The City of New York, at which at any particular time its corporate trust business shall be principally administered, which office on the date hereof is located at 101 Barclay Street, Floor 21 West, New York, New York 10286, shall be such office or agency for all of the aforesaid purposes unless the Company shall maintain some other office or agency for such purposes and shall give prompt written notice to the Trustee of the location, and any change of location, of such other office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the address of the Trustee set forth in Section 11.02. The Company may also from time to time designate one or more other offices or agencies where the Securities may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; PROVIDED, HOWEVER, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in the Borough of Manhattan, The City of New York, for such purposes. SECTION 4.06. CALCULATION OF ORIGINAL ISSUE DISCOUNT. The Company shall file with the Trustee promptly following the end of each calendar year a written notice specifying the amount of original issue discount (including daily rates and accrual periods) accrued on outstanding Securities as of the end of such year. 33 ARTICLE 5 SUCCESSOR CORPORATION SECTION 5.01. WHEN COMPANY MAY MERGE OR TRANSFER ASSETS. So long as any Securities shall be outstanding, the Company shall not consolidate with or merge into any other corporation or other person or convey, transfer or lease its properties and assets substantially as an entirety to any person (such successor corporation or person, as the case may be, shall in this Article 5 be referred to as the "Successor Company"), unless (1) either (x) the Company shall be the continuing corporation or (y) the Successor Company (if other than the Company) shall be organized and existing under the laws of the United States of America or any State or the District of Columbia, and shall expressly assume by an indenture supplemental hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the principal of and premium, if any, and interest, if any, on all the Securities and the performance of every covenant of this Indenture and in the Securities on the part of the Company to be performed or observed; (2) immediately after giving effect to such transaction, no Event of Default, and no event that, after notice or lapse of time, or both, would become an Event of Default, shall have happened and be continuing; (3) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel each stating that such consolidation, merger, conveyance, transfer or lease and such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with. SECTION 5.02. SUCCESSOR COMPANY SUBSTITUTED. Upon any consolidation with or merger into any other corporation or other person, or any conveyance, transfer or lease of the properties and assets of the Company substantially as an entirety in accordance with Section 5.01, the Successor Company or person formed by such consolidation or into which the Company is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such Successor Company or person had been named as the Company herein, and thereafter, except in the case of a lease and obligations the Company may have under a supplemental indenture pursuant to Section 10.14, the predecessor corporation shall be relieved of all obligations and covenants under this 34 Indenture and the Securities. Subject to Section 9.06, the Company, the Trustee and the successor person shall enter into a supplemental indenture to evidence the succession and substitution of such successor person and such discharge and release of the Company. ARTICLE 6 DEFAULTS AND REMEDIES SECTION 6.01. EVENTS OF DEFAULT. An "EVENT OF DEFAULT" occurs if: (1) the Company defaults in the payment of the Principal Amount, Issue Price, accrued Original Issue Discount, Redemption Price, Purchase Price or Change in Control Purchase Price on any Security when the same becomes due and payable at its Stated Maturity, upon redemption, upon declaration, when due for purchase by the Company or otherwise, whether or not such payment shall be prohibited by this Indenture; (2) the Company fails to comply with any of its agreements in the Securities or this Indenture and such failure continues for 60 days after receipt by the Company of a Notice of Default; (3) the Company pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case or proceeding; (B) consents to the entry of an order for relief against it in an involuntary case or proceeding or the commencement of any case against it; (C) consents to the appointment of a Custodian of it or for any substantial part of its property; (D) makes a general assignment for the benefit of its creditors; (E) files a petition in bankruptcy or answer or consent seeking reorganization or relief; or (F) consents to the filing of such petition or the appointment of or taking possession by a Custodian; 35 (4) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company in an involuntary case or proceeding, or adjudicates the Company insolvent or bankrupt; (B) appoints a Custodian of the Company or for any substantial part of its property; or (C) orders the winding up or liquidation of the Company; and the order or decree remains unstayed and in effect for 60 days; (5) the Company fails to deliver shares of Common Stock or pay cash in lieu of fractional shares in accordance with the terms hereof when such Common Stock or cash in lieu of fractional shares is required to be delivered, upon conversion of a Security and such failure is not remedied for a period of 10 days; or (6) (a) default shall occur (i) in the payment of any principal on any debt for borrowed money of the Company (excluding any non-recourse debt), in an aggregate principal amount in excess of $10 million, when due at its final maturity after giving effect to any applicable grace period and the holder thereof shall have taken affirmative action to enforce the payment thereof, or (ii) in the performance of any term or provision of any debt for borrowed money of the Company (excluding any non-recourse debt) in an aggregate principal amount in excess of $10.0 million that results in such debt becoming or being declared due and payable prior to the date on which it would otherwise become due and payable, unless, in the case of either clause (i) or (ii) above, (x) such acceleration or action to enforce payment, as the case may be, has been rescinded or annulled, (y) such debt has been discharged or (z) a sum sufficient to discharge in full such debt has been deposited in trust by or on behalf of the Company, in each case, within a period of 10 days after there has been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the Securities, a written notice specifying such default or defaults and stating that such notice is a "Notice of Default" hereunder. 36 A Default under clause (2) above is not an Event of Default until the Trustee notifies the Company, or the Holders of at least 25% in aggregate Principal Amount of the Securities at the time outstanding notify the Company and the Trustee, of the Default and the Company does not cure such Default within the time specified in clause (2) above after receipt of such notice. Any such notice must specify the Default, demand that it be remedied and state that such notice is a "Notice of Default." The Company shall deliver to the Trustee, within 30 days after it becomes aware of the occurrence thereof, written notice of any event which with the giving of notice and the lapse of time or both would become an Event of Default under clause (2) or clause (6), its status and what action the Company is taking or proposes to take with respect thereto. SECTION 6.02. ACCELERATION. If an Event of Default (other than an Event of Default specified in Section 6.01(3) or (4)) occurs and is continuing, unless the Principal Amount of all the Securities shall have already become due and payable, either the Trustee by notice to the Company, or the Holders of at least 25% in aggregate Principal Amount of the Securities at the time outstanding by notice to the Company and the Trustee, may declare the Issue Price and accrued Original Issue Discount through the date of declaration on all the Securities to be immediately due and payable, whereupon such Issue Price and accrued Original Issue Discount shall be due and payable immediately; provided that, if an Event of Default specified in Section 6.01(3) or (4) occurs and is continuing, the Issue Price and accrued Original Issue Discount on all the Securities through the date of the occurrence of such Event of Default shall become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Securityholders. The Holders of a majority in aggregate Principal Amount of the Securities at the time outstanding, by notice to the Trustee (and without notice to any other Securityholder) 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 have been cured or waived except nonpayment of the Issue Price and accrued Original Issue Discount that have become due solely as a result of acceleration and if all amounts due to the Trustee under Section 7.06 have been paid. No such rescission shall affect any subsequent Default or impair any right consequent thereto. 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 the Issue Price and accrued Original Issue Discount on the Securities or to enforce the performance of any provision of the Securities or this Indenture. 37 The Trustee may maintain a proceeding even if the Trustee does not possess any of the Securities or does not produce any of the Securities in the proceeding. A delay or omission by the Trustee or any Securityholder 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. No remedy is exclusive of any other remedy. All available remedies are cumulative. SECTION 6.04. WAIVER OF PAST DEFAULTS. The Holders of a majority in aggregate Principal Amount of the Securities at the time outstanding, by notice to the Trustee (and without notice to any other Securityholder), may waive an existing Default and its consequences except (a) an Event of Default described in Section 6.01(1), (b) a Default in respect of a provision that under Section 9.02 cannot be amended without the consent of each Securityholder affected or (c) a Default under Article 10. When a Default is waived, it is deemed cured and shall cease to exist, but no such waiver shall extend to any subsequent or other Default or impair any consequent right. SECTION 6.05. CONTROL BY MAJORITY. The Holders of a majority in aggregate Principal Amount of the Securities at the time outstanding may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture or that the Trustee determines in good faith is unduly prejudicial to the rights of other Securityholders or would involve the Trustee in personal liability unless the Trustee shall have been provided with reasonable security or indemnity against such liability satisfactory to the Trustee. SECTION 6.06. LIMITATION ON SUITS. A Securityholder may not pursue any remedy with respect to this Indenture or the Securities unless: (1) the Holder gives to the Trustee written notice stating that an Event of Default is continuing; (2) the Holders of at least 25% in aggregate Principal Amount of the Securities at the time outstanding make a written request to the Trustee to pursue the remedy; (3) such Holder or Holders offer to the Trustee reasonable security or indemnity against any loss, liability or expense satisfactory to the Trustee; 38 (4) the Trustee does not comply with the request within 60 days after receipt of the notice, the request and the offer of security or indemnity; and (5) the Holders of a majority in aggregate Principal Amount of the Securities at the time outstanding do not give the Trustee a direction inconsistent with the request during such 60-day period. A Securityholder may not use this Indenture to prejudice the rights of any other Securityholder or to obtain a preference or priority over any other Securityholder. SECTION 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT. Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of the Principal Amount, Issue Price, accrued Original Issue Discount, Redemption Price, Purchase Price, Change in Control Purchase Price or interest, if any, in respect of the Securities held by such Holder, on or after the respective due dates expressed in the Securities or any Redemption Date, and to convert the Securities in accordance with Article 10 or to bring suit for the enforcement of any such payment on or after such respective dates or the right to convert, shall not be impaired or affected adversely without the consent of each such Holder. SECTION 6.08. COLLECTION SUIT BY TRUSTEE. If an Event of Default described in Section 6.01(1) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount owing with respect to the Securities and the amounts provided for in Section 7.06. SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Company or any other obligor upon the Securities or the property of the Company or of such other obligor or their creditors, the Trustee (irrespective of whether the Principal Amount, Issue Price, accrued Original Issue Discount, Redemption Price, Purchase Price, Change in Control Purchase Price or interest, if any, in respect of the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Company for the payment of any such amount) shall be entitled and empowered, by intervention in such proceeding or otherwise: (a) to file and prove a claim for the whole amount of the Principal Amount, Issue Price, accrued Original Issue 39 Discount, Redemption Price, Purchase Price, Change in Control Purchase Price or interest, if any, and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding; and (b) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any Custodian, receiver, assignee, trustee, liquidator, sequestrator or similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay the Trustee any amount due 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 7.06. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding. SECTION 6.10. 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 for amounts due under Section 7.06; SECOND: to Securityholders for amounts due and unpaid on the Securities for the Principal Amount, Issue Price, accrued Original Issue Discount, Redemption Price, Purchase Price, Change in Control Purchase Price or interest, if any, as the case may be, ratably, without preference or priority of any kind, according to such amounts due and payable on the Securities; and THIRD: the balance, if any, to the Company. The Trustee may fix a record date and payment date for any payment to Securityholders pursuant to this Section 6.10. At least 15 days before such record date, the Company shall mail to 40 each Securityholder and the Trustee a notice that states the record date, the payment date and amount to be paid. 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 Trustee, a court in its discretion may require the filing by any party litigant (other than the Trustee) 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 and expenses, 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 initiated by the Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of more than 10% in aggregate Principal Amount of the Securities at the time outstanding. SECTION 6.12. NOTICE OF DEFAULTS. The Trustee shall, within 90 days after the occurrence of any Default, mail to all Holders of Securities, as the names and addresses of such Holders appear on the books of registry of the Company, notice of all Defaults of which the Trustee shall be aware, unless such Defaults shall have been cured or waived before the giving of such notice; PROVIDED that, except in the case of a Default described in Section 6.01(1), the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee, or a trust committee of directors or Trust Officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Holders of Securities. SECTION 6.13. WAIVER OF STAY, EXTENSION OR USURY LAWS. The Company covenants (to the extent it may lawfully do so) that it shall not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury or other law, wherever enacted, now or at any time hereafter in force, that would prohibit or forgive the Company from paying all or any portion of the Principal Amount, Issue Price, accrued Original Issue Discount, Redemption Price, Purchase Price or Change in Control Purchase Price in respect of the Securities, or any interest on any such amounts, as contemplated herein, or that may affect the covenants or the performance of this Indenture or the Securities; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. 41 ARTICLE 7 TRUSTEE SECTION 7.01. RIGHTS OF TRUSTEE. (a) Before the Trustee acts or refrains from acting, it may require an Officers' Certificate or an Opinion of Counsel. 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. (b) The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care. (c) The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers. (d) The Trustee may refuse to perform any duty or exercise any right or power or extend or risk its own funds or otherwise incur any financial liability unless it receives indemnity satisfactory to it against any loss, liability or expense. (e) Money held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee (acting in any capacity hereunder) shall be under no liability for interest on any money received by it hereunder. (f) The Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee. (g) In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions that by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein). (h) The Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer, unless it shall 42 be proved that the Trustee was negligent in ascertaining the pertinent facts. (i) The Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of a majority in principal amount of the outstanding Securities relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Securities. (j) The Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon. (k) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee reasonably believes that a default may exist, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation. SECTION 7.02. INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, Conversion Agent or co-registrar may do the same with like rights. However, the Trustee must comply with Sections 7.09 and 7.10. SECTION 7.03. TRUSTEE'S DISCLAIMER. The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities, it shall not be accountable for the Company's use of the proceeds from the Securities, it shall not be responsible for any statement in the registration statement for the Securities under the Securities Act or in the Indenture or the Securities (other than its certificate of authentication), or the determination as to which beneficial owners are entitled to receive any notices hereunder. 43 SECTION 7.04. NOTICE OF DEFAULTS. The Trustee shall, within 90 days after the occurrence of any Default, mail to all Holders of Securities, as the names and addresses of such Holders appear on the books of registry of the Company, notice of all Defaults of which the Trustee shall be aware, unless such Defaults shall have been cured or waived before the giving of such notice. Except in the case of a Default described in Section 6.01(1), the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee, or a trust committee of directors or Trust Officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Holders of Securities. SECTION 7.05. REPORTS BY TRUSTEE TO HOLDERS. Within 60 days after each _________ beginning with the ________ following the date of this Indenture, the Trustee shall mail to each Securityholder a brief report dated as of such _________ that complies with TIA Section 313(a), if required by said Section. The Trustee also shall comply with TIA Section 313(b). A copy of each report at the time of its mailing to Securityholders shall be provided to the Company and shall be filed with the SEC and each stock exchange on which the Securities are listed. The Company agrees promptly to notify the Trustee whenever the Securities become listed on any stock exchange and of any delisting thereof. SECTION 7.06. COMPENSATION AND INDEMNITY. The Company agrees: (a) to pay to the Trustee from time to time such compensation (in accordance with a fee schedule agreed upon from time to time) for all services rendered by it hereunder (which compensation shall not (to the extent permitted by law) be limited by any provision of law in regard to the compensation of a trustee of an express trust); (b) to reimburse the Trustee (in accordance with a fee schedule agreed upon from time to time) upon its request and, if required by the Company, submission of reasonable documentation for all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses, advances and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence or bad faith; and (c) to indemnify each of the Trustee or any predecessor Trustee for, and to hold it harmless against, any and all loss, liability, damage, claim or expense, including taxes (other than taxes based upon, measured or determined by the income of the 44 Trustee), incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of this trust, including the reasonable costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. The Trustee shall give the Company notice of any claim or liability for which the Trustee might be entitled to indemnification under subparagraph (c) of this Section 7.06, within a reasonable amount of time after a Trust Officer of the Trustee actually becomes aware of such claim or liability. To secure the Company's payment obligations in this Section 7.06, the Trustee shall have a lien prior to the Securities on all money or property held or collected by the Trustee. The Company's payment obligations pursuant to this Section 7.06 shall survive the discharge of this Indenture. When the Trustee incurs expenses after the occurrence of a Default specified in Section 6.01(4) or (5), the expenses are intended to constitute expenses of administration under the Bankruptcy Law. The provisions of this Section shall survive the termination of this Indenture. SECTION 7.07. REPLACEMENT OF TRUSTEE. The Trustee may resign by so notifying the Company; PROVIDED, HOWEVER, no such resignation shall be effective until a successor Trustee has accepted its appointment pursuant to this Section 7.07. The Holders of a majority in aggregate Principal Amount of the Securities at the time outstanding may remove the Trustee by so notifying the Trustee and may appoint a successor Trustee (subject to the consent of the Company, such consent not to be unreasonably withheld). The Company shall remove the Trustee if: (1) the Trustee fails to comply with Section 7.09; (2) the Trustee is adjudged bankrupt or insolvent; (3) a receiver or other public officer takes charge of the Trustee or its property; or (4) the Trustee otherwise 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, by resolution of its Board of Directors, a successor Trustee. A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. 45 Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Securityholders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.06. If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of a majority in aggregate Principal Amount of the Securities at the time outstanding may petition any court of competent jurisdiction for the appointment of a successor Trustee. If the Trustee fails to comply with Section 7.09, any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. SECTION 7.08. SUCCESSOR TRUSTEE BY MERGER. If the Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee. SECTION 7.09. ELIGIBILITY; DISQUALIFICATION. The Trustee shall at all times satisfy the requirements of TIA Sections 310(a)(1) and 310(b). The Trustee shall have a combined capital and surplus of at least $100,000,000 as set forth in its most recent published annual report of condition. In determining whether the Trustee has conflicting interests as defined in TIA Section 310(b)(1), the provisions contained in the proviso to TIA Section 310(b)(1) shall be deemed incorporated herein. SECTION 7.10. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. The Trustee shall comply with TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated therein. SECTION 7.11. MONEY HELD IN TRUST. Money held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed in writing with the Company. 46 ARTICLE 8 DISCHARGE OF INDENTURE SECTION 8.01. DISCHARGE OF LIABILITY ON SECURITIES. When (i) the Company delivers to the Trustee all outstanding Securities (other than Securities replaced pursuant to Section 2.07) for cancellation or (ii) all outstanding Securities have become due and payable and the Company deposits with the Trustee cash or, if expressly permitted by the terms hereof, securities sufficient to pay at Stated Maturity the Principal Amount of all outstanding Securities (other than Securities replaced pursuant to Section 2.07), and if in either case the Company pays all other sums payable hereunder by the Company (including, without limitation, sums payable by delivery of shares of Common Stock pursuant to Section 3.08), then this Indenture shall, subject to Section 7.06, cease to be of further effect. The Trustee shall join in the execution of a document prepared by the Company acknowledging satisfaction and discharge of this Indenture on demand of the Company accompanied by an Officers' Certificate and Opinion of Counsel and at the cost and expense of the Company. SECTION 8.02. REPAYMENT TO THE COMPANY. The Trustee and the Paying Agent shall return to the Company upon written request any money or securities held by them for the payment of any amount with respect to the Securities that remains unclaimed for two years; PROVIDED, HOWEVER, that the Trustee or such Paying Agent, before being required to make any such return, may, at the expense of the Company, cause to be published once in THE WALL STREET JOURNAL or another daily newspaper of national circulation or mail to each such Holder notice that such money or securities remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such mailing, any unclaimed money or securities then remaining will be returned to the Company. After return to the Company, Holders entitled to the money or securities must look to the Company for payment as general creditors unless an applicable abandoned property law designates another person, and the Trustee and the Paying Agent shall have no further liability with respect to such money or securities for that period commencing after the return thereof. 47 ARTICLE 9 AMENDMENTS SECTION 9.01. WITHOUT CONSENT OF HOLDERS. The Company and the Trustee may amend this Indenture or the Securities without the consent of any Securityholder: (1) to cure any ambiguity, omission, defect or inconsistency; PROVIDED, HOWEVER, that such amendment does not materially adversely affect the rights of any Securityholder; (2) to comply with Article 5 or Section 10.14; (3) to provide for uncertificated Securities in addition to or in place of certificated Securities so long as such uncertificated Securities are in registered form for purposes of the Internal Revenue Code of 1986, as amended; (4) to make any change that does not adversely affect the rights of any Securityholder; (5) to add to the covenants or obligations of the Company hereunder, for the benefit of the Securityholders, or to surrender any right, power or option herein conferred upon the Company; or (6) to make any change to comply with the TIA, or any amendment thereafter, or any requirement of the SEC in connection with the qualification of this Indenture under the TIA or any amendment thereof. SECTION 9.02. WITH CONSENT OF HOLDERS. With the written consent of the Holders of at least a majority in aggregate Principal Amount of the Securities at the time outstanding, the Company and the Trustee may amend this Indenture or the Securities. However, without the consent of each Securityholder affected, an amendment or supplement to this Indenture or the Securities may not: (1) make any change to the Principal Amount of Securities whose Holders must consent to an amendment; (2) make any change to the rate of accrual in connection with Original Issue Discount, reduce the rate of interest referred to in paragraph 1 of the Securities or extend the time for payment of accrued Original Issue Discount or interest, if any, on any Security; 48 (3) reduce the Principal Amount or the Issue Price of or extend the Stated Maturity of any Security; (4) reduce the amount of cash payable in respect of conversion upon the Company's election to pay cash with respect thereto, the Redemption Price, Purchase Price or Change in Control Purchase Price of any Security or extend the date on which the Purchase Price or Change in Control Purchase Price of any Security is payable; (5) make any Security payable in money or securities other than that stated in the Security; (6) make any change in Section 6.04 or this Section 9.02, except to increase any percentage referred to therein, or make any change in Section 6.07; (7) make any change that adversely affects the right to convert any Security (including the right to receive cash in lieu of Common Stock except as set forth in Section 9.01(4)); (8) make any change that adversely affects the right to require the Company to purchase the Securities in accordance with the terms thereof and this Indenture (including the right to receive cash if the Company has elected to pay cash upon such purchase); (9) make any change to the provisions of this Indenture relating to the purchase of Securities at the option of the Holder pursuant to Section 3.08 or 3.09 which change would result in a violation of applicable federal or state securities laws (including positions of the SEC under applicable no-action letters), whether as a result of the exercise or performance of any rights or obligations under such provisions or otherwise; or (10) impair the right to institute suit for the enforcement of any payment with respect to, or conversion of, the Securities. It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent approves the substance thereof. After an amendment under this Section 9.02 becomes effective, the Company shall mail to each Holder a notice briefly describing the amendment. 49 SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT. Every supplemental indenture executed pursuant to this Article shall comply with the TIA as then in effect. SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS, WAIVERS AND ACTIONS. Until an amendment or waiver becomes effective, a consent to it or any other action by a Holder of a Security hereunder is a continuing consent by the Holder and every subsequent Holder of that Security or portion of the Security that evidences the same obligation as the consenting Holder's Security, even if notation of the consent, waiver or action is not made on the Security. However, any such Holder or subsequent Holder may revoke the consent, waiver or action as to such Holder's Security or portion of the Security if the Trustee receives the notice of revocation before the date the amendment, waiver or action becomes effective. After an amendment, waiver or action becomes effective, it shall bind every Securityholder, except as provided in Section 9.02. SECTION 9.05. NOTATION ON OR EXCHANGE OF SECURITIES. Securities authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Securities so modified as to conform, in the opinion of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for outstanding Securities. SECTION 9.06. TRUSTEE TO SIGN SUPPLEMENTAL INDENTURES. The Trustee shall sign any 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 such amendment the Trustee shall be entitled to receive, and (subject to the provisions of Section 7.01) shall be fully protected in relying upon, an Officers' Certificate and an Opinion of Counsel stating that such amendment is authorized or permitted by this Indenture. SECTION 9.07. EFFECT OF SUPPLEMENTAL INDENTURES. Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. 50 ARTICLE 10 CONVERSION SECTION 10.01. CONVERSION PRIVILEGE. A Holder of a Security may convert such Security into Common Stock at any time during the period stated in paragraph 8 of the Securities. The number of shares of Common Stock issuable upon conversion of a Security per $1,000 of Principal Amount thereof (the "CONVERSION RATE") shall be that set forth in paragraph 8 in the Securities, subject to adjustment as herein set forth. A Holder may convert a portion of the Principal Amount of a Security if the portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to conversion of all of a Security also apply to conversion of a portion of a Security. "AVERAGE SALE PRICE" means the average of the Sale Prices of the Common Stock for the shorter of (i) 30 consecutive Trading Days ending on the last full Trading Day prior to the Time of Determination with respect to the rights, options, warrants or distribution in respect of which the Average Sale Price is being calculated, or (ii) the period (x) commencing on the date next succeeding the first public announcement of (a) the issuance of rights, options or warrants or (b) the distribution, in each case, in respect of which the Average Sale Price is being calculated and (y) proceeding through the last full trading day prior to the Time of Determination with respect to the rights, warrants or distribution in respect of which the Average Sale Price is being calculated, or (iii) the period, if any, (x) commencing on the date next succeeding the Ex-Dividend Time with respect to the next preceding (a) issuance of rights, warrants, or options or (b) distribution, in each case, for which an adjustment is required by the provisions of Section 10.06(4), 10.07 or 10.08 and (y) proceeding through the last full Trading Day prior to the Time of Determination with respect to the rights, warrants, or options or distribution in respect of which the Average Sale Price is being calculated. If the Ex-Dividend Time (or in the case of a subdivision, combination or reclassification, the effective date with respect thereto) with respect to a dividend, subdivision, combination or 51 reclassification to which Section 10.06(1), (2), (3) or (5) applies occurs during the period applicable for calculating "Average Sale Price" pursuant to the definition in the preceding sentence, "Average Sale Price" shall be calculated for such period in a manner determined by the Board of Directors to reflect the impact of such dividend, subdivision, combination or reclassification on the Sale Price of the Common Stock during such period. "TIME OF DETERMINATION" means the time and date of the earlier of (i) the determination of stockholders entitled to receive rights, warrants, or options or a distribution, in each case, to which Sections 10.07 and 10.08 apply and (ii) the time ("EX-DIVIDEND TIME") immediately prior to the commencement of "ex-dividend" trading for such rights, options, warrants or distribution on the New York Stock Exchange or such other national or regional exchange or market on which the Common Stock is then listed or quoted. SECTION 10.02. CONVERSION PROCEDURE. To convert a Security a Holder must satisfy the requirements in paragraph 8 of the Securities. The date on which the Holder satisfies all those requirements is the conversion date (the "CONVERSION DATE"). The Company shall deliver to the Holder no later than the seventh Business Day following the Conversion Date, through the Conversion Agent, a certificate for the number of full shares of Common Stock issuable upon the conversion and cash in lieu of any fractional share determined pursuant to Section 10.03. The person in whose name the certificate is registered shall be treated as a stockholder of record on and after the Conversion Date; PROVIDED, HOWEVER, that no surrender of a Security on any date when the stock transfer books of the Company shall be closed shall be effective to constitute the person or persons entitled to receive the shares of Common Stock upon such conversion as the record holder or holders of such shares of Common Stock on such date, but such surrender shall be effective to constitute the person or persons entitled to receive such shares of Common Stock as the record holder or holders thereof for all purposes at the close of business on the next succeeding day on which such stock transfer books are open; PROVIDED, FURTHER, that such conversion shall be at the Conversion Rate in effect on the date that such Security shall have been surrendered for conversion, as if the stock transfer books of the Company had not been closed. Upon conversion of a Security, such person shall no longer be a Holder of such Security. Holders may surrender a Security for conversion by means of book entry delivery in accordance with paragraph 8 of the 52 Securities and the regulations of the applicable book entry facility. No payment or adjustment will be made for dividends on any Common Stock except as provided in this Article 10. On conversion of a Security, that portion of accrued Original Issue Discount attributable to the period from the Issue Date to the Conversion Date with respect to the converted Security shall not be cancelled, extinguished or forfeited, but rather shall be deemed to be paid in full to the Holder thereof through delivery of the Common Stock (together with the cash payment, if any, in lieu of fractional shares) in exchange for the Security being converted pursuant to the provisions hereof; and the fair market value of such shares of Common Stock (together with any such cash payment in lieu of any fractional shares of Common Stock) shall be treated as issued, to the extent thereof, first in exchange for Original Issue Discount accrued through the Conversion Date, and the balance, if any, of such fair market value of such shares of Common Stock (and any such cash payment) shall be treated as issued in exchange for the Issue Price of the Security being converted pursuant to the provisions hereof. If the Holder converts more than one Security at the same time, the number of shares of Common Stock issuable upon the conversion shall be computed based on the total Principal Amount of the Securities converted. Upon surrender of a Security that is converted in part, the Company shall execute, and the Trustee shall authenticate and deliver to the Holder, a new Security in an authorized denomination equal in Principal Amount to the unconverted portion of the Security surrendered. If the last day on which a Security may be converted is a Legal Holiday in a place where the Conversion Agent is located, the Security may be surrendered to such Conversion Agent on the next succeeding day that is not a Legal Holiday. SECTION 10.03. FRACTIONAL SHARES. The Company will not issue a fractional share of Common Stock upon conversion of a Security. Instead, the Company will deliver cash for the current market value of the fractional share. The current market value of a fractional share shall be determined to the nearest 1/1000th of a share by multiplying the Sale Price, on the last Trading Day prior to the Conversion Date, of a full share by the fractional amount and rounding the product to the nearest whole cent. SECTION 10.04. TAXES ON CONVERSION. If a Holder converts a Security, the Company shall pay any documentary, stamp or similar issue or transfer tax due on the issue of shares of Common Stock 53 upon such conversion. However, the Holder shall pay any such tax which is due because the Holder requests the shares to be issued in a name other than the Holder's name. The Conversion Agent may refuse to deliver the certificates representing the Common Stock being issued in a name other than the Holder's name until the Conversion Agent receives a sum sufficient to pay any tax which will be due because the shares are to be issued in a name other than the Holder's name. Nothing herein shall preclude any tax withholding required by law or regulations. SECTION 10.05. COMPANY TO PROVIDE STOCK. The Company shall, prior to issuance of any Securities hereunder, and from time to time as may be necessary, reserve out of its authorized but unissued Common Stock a sufficient number of shares of Common Stock to permit the conversion of the Securities for shares of Common Stock. All shares of Common Stock delivered upon conversion of the Securities shall be newly issued shares or treasury shares, shall be duly and validly issued and fully paid and nonassessable and shall be free from preemptive rights and free of any lien or adverse claim. The Company will endeavor promptly to comply with all Federal and state securities laws regulating the offer and delivery of shares of Common Stock upon conversion of Securities, if any, and will list or cause to have quoted such shares of Common Stock on each national securities exchange or in the over-the-counter market or such other market on which the Common Stock is then listed or quoted. SECTION 10.06. ADJUSTMENT FOR CHANGE IN CAPITAL STOCK. If, after the Issue Date, the Company: (1) pays a dividend or makes a distribution on its Common Stock in shares of its Common Stock; (2) subdivides its outstanding shares of Common Stock into a greater number of shares; (3) combines its outstanding shares of Common Stock into a smaller number of shares; (4) pays a dividend or makes a distribution on its Common Stock in shares of its Capital Stock (other than Common Stock or rights, warrants or options for its Capital Stock); or 54 (5) issues by reclassification of its Common Stock any shares of its Capital Stock (other than rights, warrants or options for its Capital Stock), then the conversion privilege and the Conversion Rate in effect immediately prior to such action shall be adjusted so that the Holder of a Security thereafter converted may receive the number of shares or other units of Capital Stock of the Company which such Holder would have owned immediately following such action if such Holder had converted the Security immediately prior to such action. The adjustment shall become effective immediately after the record date in the case of a dividend or distribution and immediately after the effective date in the case of a subdivision, combination or reclassification. If after an adjustment a Holder of a Security upon conversion of such Security may receive shares or other units of two or more classes or series of Capital Stock of the Company, the Conversion Rate shall thereafter be subject to adjustment upon the occurrence of an action taken with respect to any such class or series of Capital Stock as is contemplated by this Article 10 with respect to the Common Stock, on terms comparable to those applicable to Common Stock in this Article 10. SECTION 10.07. ADJUSTMENT FOR RIGHTS ISSUE. If, after the Issue Date, the Company distributes any rights, warrants or options to all holders of its Common Stock entitling them, for a period expiring within 60 days after the record date for such distribution, to purchase shares of Common Stock at a price per share less than the Sale Price as of the Time of Determination, the Conversion Rate shall be adjusted in accordance with the formula: (0 + N) ----------- R' = R x 0 + (N X P) ------ M where: R' = the adjusted Conversion Rate. R = the current Conversion Rate. 0 = the number of shares of Common Stock outstanding on the record date for the distribution. N = the number of additional shares of Common Stock offered pursuant to the distribution. 55 P = the offering price per share of such additional shares. M = the Average Sale Price, MINUS, in the case of (i) a distribution to which Section 10.06(4) applies or (ii) a distribution to which Section 10.08 applies, for which, in each case, (x) the record date shall occur on or before the record date for the distribution to which this Section 10.07 applies and (y) the Ex-Dividend Time shall occur on or after the date of the Time of Determination for the distribution to which this Section 10.07 applies, the fair market value (on the record date for the distribution to which this Section 10.07 applies) of: (1) the Capital Stock of the Company distributed in respect of each share of Common Stock in such Section 10.06(4) distribution, and (2) the assets of the Company or debt securities or any rights, warrants or options to purchase securities of the Company distributed in respect of each share of Common Stock in such Section 10.08 distribution. The Board of Directors shall determine fair market values for the purposes of this Section 10.07. The adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive the rights, warrants or options to which this Section 10.07 applies. No adjustment shall be made under this Section 10.07 if the application of the formula stated above in this Section 10.07 would result in value of R' that is equal to or less than the value of R. SECTION 10.08. ADJUSTMENT FOR OTHER DISTRIBUTIONS. If, after the Issue Date, the Company distributes to all holders of its Common Stock any of its assets or debt securities or any rights, warrants or options to purchase securities of the Company (including securities or cash, but excluding (x) distributions of Capital Stock referred to in Section 10.06 and distributions of rights, warrants or options referred to in Section 10.07 and (y) cash dividends or other cash distributions that are paid out of consolidated current net income or earnings retained in the business as shown on the books of the Company unless such cash dividends or other cash distributions are Extraordinary Cash 56 Dividends (as defined below)), the Conversion Rate shall be adjusted, subject to the provisions of the last paragraph of this Section 10.08, in accordance with the formula: M R' = R x M-F where: R' = the adjusted Conversion Rate. R = the current Conversion Rate. M = the Average Sale Price, MINUS, in the case of a distribution to which Section 10.06(4) applies for which (i) the record date shall occur on or before the record date for the distribution to which this Section 10.08 applies and (ii) the Ex-Dividend Time shall occur on or after the date of the Time of Determination for the distribution to which this Section 10.08 applies, the fair market value (on the record date for the distribution to which this Section 10.08 applies) of any Capital Stock of the Company distributed in respect of each share of Common Stock in such Section 10.06(4) distribution. F = the fair market value (on the record date for the distribution to which this Section 10.08 applies) of the assets, securities, rights, warrants or options to be distributed in respect of each share of Common Stock in the distribution to which this Section 10.08 is being applied (including, in the case of cash dividends or other cash distributions giving rise to an adjustment, all such cash distributed concurrently). The Board of Directors shall determine fair market values for the purpose of this Section 10.08. The adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive the distribution to which this Section 10.08 applies. For purposes of this Section 10.08, the term "EXTRAORDINARY CASH DIVIDEND" shall mean any cash dividend with respect to the Common Stock the amount of which, together with the aggregate amount of cash dividends on the Common Stock to be aggregated with such cash dividend in accordance with the provisions of this paragraph, equals or exceeds the threshold percentages set forth in items (i) or (ii) below: 57 (i) If, upon the date prior to the Ex-Dividend Time with respect to a cash dividend on the Common Stock, the aggregate amount of such cash dividend together with the amounts of all cash dividends on the Common Stock with Ex-Dividend Times occurring in the eighty-five (85) consecutive day period ending on the date prior to the Ex-Dividend Time with respect to the cash dividend to which this provision is being applied equals or exceeds 12.5% of the average of the Sale Prices during the period beginning on the date after the first such Ex-Dividend Time in such period and ending on the date prior to the Ex-Dividend Time with respect to the cash dividend to which this provision is being applied (except that if no other cash dividend has had an Ex-Dividend Time occurring in such period, the period for calculating the average of the Sale Prices shall be the period commencing 85 days prior to the date prior to the Ex-Dividend Time with respect to the cash dividend to which this provision is being applied), such cash dividend together with each other cash dividend with an Ex-Dividend Time occurring in such 85-day period shall be deemed to be an Extraordinary Cash Dividend and for purposes of applying the formula set forth above in this Section 10.08, the value of "F" shall be equal to (w) the aggregate amount of such cash dividend together with the amounts of the other cash dividends with Ex-Dividend Times occurring in such period MINUS (x) the aggregate amount of such other cash dividends with Ex-Dividend Times occurring in such period for which a prior adjustment in the Conversion Rate was previously made under this Section 10.08. (ii) If upon the date prior to the Ex-Dividend Time with respect to a cash dividend on the Common Stock, the aggregate amount of such cash dividend, together with the amounts of all cash dividends on the Common Stock with Ex-Dividend Times occurring in the 365-consecutive-day period ending on the date prior to the Ex-Dividend Time with respect to the cash dividend to which this provision is being applied equals or exceeds 25% of the average of the Sale Prices during the period beginning on the date after the first such Ex-Dividend Time in such period and ending on the date prior to the Ex-Dividend Time with respect to the cash dividend to which this provision is being applied (except that if no other cash dividend has had an Ex-Dividend Time occurring in such period, the period for calculating the average of the Sale Prices shall be the period commencing 365 days prior to the date prior to the Ex-Dividend Time with respect to the cash dividend to which this provision is being applied), such cash dividend together with each other cash dividend with an Ex-Dividend Time occurring in such 365-day period shall be deemed to be 58 an Extraordinary Cash Dividend and for purposes of applying the formula set forth above in this Section 10.08, the value of "F" shall be equal to (y) the aggregate amount of such cash dividend together with amounts of the other cash dividends with Ex-Dividend Times occurring in such period MINUS (z) the aggregate amount of such other cash dividends with Ex-Dividend Times occurring in such period for which a prior adjustment in the Conversion Rate was previously made under this Section 10.08. In making the determinations required by items (i) and (ii) above, the amount of cash dividends paid on a per share basis and the average of the Sale Prices, in each case during the period specified in items (i) and (ii) above, as applicable, shall be appropriately adjusted to reflect the occurrence during such period of any event described in Section 10.06 In the event that, with respect to any distribution to which this Section 10.08 would otherwise apply, the difference "M-F" as defined in the above formula is less than $1.00 or "F" is greater than "M", then the adjustment provided by this Section 10.08 shall not be made and in lieu thereof the provisions of Section 10.14 shall apply to such distribution. SECTION 10.09. WHEN ADJUSTMENT MAY BE DEFERRED. No adjustment in the Conversion Rate need be made unless the adjustment would require an increase or decrease of at least 1% (E.G., if the Conversion Rate is 4, an increase or decrease of .04 (1% of 4)) in the Conversion Rate. Any adjustments that are not made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Article 10 shall be made to the nearest cent or to the nearest 1/1,000th of a share, as the case may be, with one-half of a cent and 5/10,000ths of a share being rounded upwards. SECTION 10.10. WHEN NO ADJUSTMENT REQUIRED. No adjustment need be made for a transaction referred to in Section 10.06, 10.07, 10.08 or 10.14 if Securityholders are to participate in the transaction on a basis and with notice that the Board of Directors determines to be fair and appropriate in light of the basis and notice on which holders of Common Stock participate in the transaction. No adjustment need be made for rights to purchase Common Stock pursuant to a Company plan for reinvestment of dividends or interest. 59 No adjustment need be made for a change in the par value or no par value of the Common Stock. No adjustment need be made unless such adjustment, together with any other adjustments similarly deferred equals at least 1% of the then current Conversion Rate. To the extent the Securities become convertible into cash pursuant to the terms of Section 10.08 or 10.14, no adjustment need be made thereafter as to the cash. Interest will not accrue on the cash. Notwithstanding any provision to the contrary in this Indenture, no adjustment shall be made in the Conversion Rate to the extent, but only to the extent, such adjustment results in the following quotient being less than the par value of the Common Stock: (i) the Issue Price plus accrued Original Issue Discount as of the date such adjustment would otherwise be effective divided by (ii) the Conversion Rate as so adjusted. SECTION 10.11. NOTICE OF ADJUSTMENT. Whenever the Conversion Rate is adjusted, the Company shall file with the Trustee and the Conversion Agent a notice of such adjustment and a certificate from the Company's independent public accountants briefly stating the facts requiring the adjustment and the manner of computing it. The Conversion Agent will promptly mail such notice to Securityholders at the Company's expense. The certificate shall be conclusive evidence that the adjustment is correct. Neither the Trustee nor any Conversion Agent shall be under any duty or responsibility with respect to any such certificate except to exhibit the same to any Holder desiring inspection thereof. SECTION 10.12. VOLUNTARY INCREASE. The Company from time to time may increase the Conversion Rate by any amount and for any period of time (PROVIDED, that such period is not less than 20 Business Days). Whenever the Conversion Rate is increased, the Company shall mail to Securityholders and file with the Trustee and the Conversion Agent a notice of the increase. The Company shall mail the notice at least 15 days before the date the increased Conversion Rate takes effect. The notice shall state the increased Conversion Rate and the period it will be in effect. A voluntary increase of the Conversion Rate does not change or adjust the Conversion Rate otherwise in effect for purposes of Sections 10.06, 10.07 or 10.08. 60 SECTION 10.13. NOTICE OF CERTAIN TRANSACTIONS. If: (1) the Company takes any action that would require an adjustment in the Conversion Rate pursuant to Section 10.06, 10.07 or 10.08 (unless no adjustment is to occur pursuant to Section 10.10); or (2) the Company takes any action that would require a supplemental indenture pursuant to Section 10.14; or (3) there is a liquidation or dissolution of the Company; then the Company shall mail to Securityholders and file with the Trustee and the Conversion Agent a notice stating the proposed record date for a dividend or distribution of the proposed effective date of a subdivision, combination, reclassification, consolidation, merger, binding share exchange, transfer, liquidation or dissolution. The Company shall file and mail the notice at least 15 days before such date. Failure to file or mail the notice or any defect in it shall not affect the validity of the transaction. SECTION 10.14. REORGANIZATION OF COMPANY; SPECIAL DISTRIBUTIONS. If the Company is a party to a transaction subject to Section 5.01 (other than a sale of all or substantially all of the assets of the Company in a transaction in which the holders of Common Stock immediately prior to such transaction do not receive securities, cash or other assets of the Company or any other person) or a merger or binding share exchange which reclassifies or changes its outstanding Common Stock, the person obligated to deliver securities, cash or other assets upon conversion of Securities shall enter into a supplemental indenture. If the issuer of securities deliverable upon conversion of Securities is an Affiliate of the successor Company, that issuer shall join in the supplemental indenture. The supplemental indenture shall provide that the Holder of a Security may convert it into the kind and amount of securities, cash or other assets which such Holder would have received immediately after the consolidation, merger, binding share exchange or transfer if such Holder had converted the Security immediately before the effective date of the transaction, assuming (to the extent applicable) that such Holder (i) was not a constituent person or an Affiliate of a constituent person to such transaction; (ii) made no election with respect thereto; and (iii) was treated alike with the plurality of non-electing Holders. The supplemental indenture shall provide for adjustments which shall be as nearly equivalent as may be practical to the adjustments provided for in this Article 10. 61 The successor Company shall mail to Securityholders a notice briefly describing the supplemental indenture. If this Section applies, neither Section 10.06 nor 10.07 applies. If the Company makes a distribution to all holders of its Common Stock of any of its assets, or debt securities or any rights, warrants or options to purchase securities of the Company that, but for the provisions of the last paragraph of Section 10.08, would otherwise result in an adjustment in the Conversion Rate pursuant to the provisions of Section 10.08, then, from and after the record date for determining the holders of Common Stock entitled to receive the distribution, a Holder of a Security that converts such Security in accordance with the provisions of this Indenture shall upon such conversion be entitled to receive, in addition to the shares of Common Stock into which the Security is convertible, the kind and amount of securities, cash or other assets comprising the distribution that such Holder would have received if such Holder had converted the Security immediately prior to the record date for determining the holders of Common Stock entitled to receive the distribution. SECTION 10.15. COMPANY DETERMINATION FINAL. Any determination that the Company or the Board of Directors must make pursuant to this Article 10 is conclusive. SECTION 10.16. TRUSTEE'S ADJUSTMENT DISCLAIMER. The Trustee has no duty to determine when an adjustment under this Article 10 should be made, how it should be made or what it should be. The Trustee has no duty to determine whether a supplemental indenture under Section 10.14 need be entered into or whether any provisions of any supplemental indenture are correct. The Trustee shall not be accountable for and makes no representation as to the validity or value of any securities or assets issued upon conversion of Securities. The Trustee shall not be responsible for the Company's failure to comply with this Article 10. Each Conversion Agent (other than the Company or an Affiliate of the Company) shall have the same protection under this Section 10.16 as the Trustee. SECTION 10.17. SIMULTANEOUS ADJUSTMENTS. If this Article 10 requires adjustments to the Conversion Rate under more than one of Sections 10.06(4), 10.07 or 10.08, and the record dates for the distributions giving rise to such adjustments shall occur on the same date, then such adjustments shall be made by applying, first, the provisions of Section 10.06, second, the provisions of Section 10.08 and, third, the provisions of Section 10.07. 62 SECTION 10.18. SUCCESSIVE ADJUSTMENTS. After an adjustment to the Conversion Rate under this Article 10, any subsequent event requiring an adjustment under this Article 10 shall cause an adjustment to the Conversion Rate as so adjusted. ARTICLE 11 MISCELLANEOUS SECTION 11.01 TRUST INDENTURE ACT CONTROLS. If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the required provision shall control. SECTION 11.02 NOTICES. Any notice or communication shall be in writing and delivered in person or mailed by first-class mail, postage prepaid, addressed as follows: if to the Company: Jacor Communications, Inc. 1300 PNC Center 201 East Fifth Street Cincinnati, Ohio 45202 Attention: with copy to: if to the Trustee: The Bank of New York Corporate Trust Administration 101 Barclay Street Floor 21 West New York, New York 10286 The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications. Any notice or communication given to a Securityholder shall be mailed by first-class mail to the Securityholder at the Securityholder's address as it appears on the registration books 63 of the Registrar and shall be sufficiently given if so mailed within the time prescribed. Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not received by the addressee. If the Company mails a notice or communication to the Securityholders, it shall mail a copy to the Trustee and each Registrar, Paying Agent, Conversion Agent or co-registrar. SECTION 11.03 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS. Securityholders may communicate pursuant to TIA Section 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar, the Paying Agent, the Conversion Agent 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 Trustee may require the Company to furnish either or both of the following: (1) an Officers' Certificate stating that, in the opinion of the principal signer thereof, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and (2) an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent have been complied with. SECTION 11.05 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION. Each Officers' Certificate or Opinion of Counsel with respect to compliance with a covenant or condition provided for in this Indenture shall include: (1) a statement that the principal signer of such Officers' Certificate or Opinion of Counsel has read such covenant or condition; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such Officers' Certificate or Opinion of Counsel are based; (3) a statement that, in the opinion of the principal signer, he or she has made such examination or investigation 65 as is necessary to enable such person to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement that, in the opinion of such person, such covenant or condition has been complied with. SECTION 11.06 SEPARABILITY CLAUSE. In case any provision in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. SECTION 11.07 RULES BY TRUSTEE, PAYING AGENT, CONVERSION AGENT AND REGISTRAR. The Trustee may make reasonable rules for action by or a meeting of the Securityholders. The Registrar, Conversion Agent and the Paying Agent may make reasonable rules for their functions. SECTION 11.08 LEGAL HOLIDAY. A "Legal Holiday" is any day other than a Business Day. If any specified date (including a date for giving notice) is a Legal Holiday, the action shall be taken on the next succeeding day that is not a Legal Holiday, and to the extent applicable no Original Issue Discount or interest, if any, shall accrue for the intervening period. SECTION 11.09 GOVERNING LAW. THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS. SECTION 11.10 NO RECOURSE AGAINST OTHERS. A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or this Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Security, each Securityholder shall waive and release all such liability. The waiver and release shall be part of the consideration for the issue of the Securities. SECTION 11.11 SUCCESSORS. All agreements of the Company in this Indenture and the Securities shall bind its successor. All agreements of the Trustee in this Indenture shall bind its successor. SECTION 11.12 MULTIPLE 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. One signed copy is enough to prove this Indenture. 66 SIGNATURES IN WITNESS WHEREOF, the undersigned, being duly authorized, have executed this Indenture on behalf of the respective parties hereto as of the date first above written. JACOR COMMUNICATIONS, INC. By ------------------------------------- Title: THE BANK OF NEW YORK, as Trustee By ------------------------------------- Title: 67 EXHIBIT A [FORM OF FACE OF LYON] FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT WITH RESPECT TO EACH $1,000 OF PRINCIPAL AMOUNT OF THIS SECURITY IS $____, THE ISSUE DATE IS ______, 1996, AND THE YIELD TO STATED MATURITY IS __% PER ANNUM (COMPUTED ON A SEMIANNUAL BOND EQUIVALENT BASIS). A-1 JACOR COMMUNICATIONS, INC. LIQUID YIELD OPTIONTM NOTE DUE 2011 (ZERO COUPON -- SENIOR) No. Issue Date: ______, 1996 CUSIP No. ___________ Issue Price: $_____ Original Issue Discount: $_____ (for each $1,000 Principal amount) Jacor Communications, Inc., a Delaware corporation, promises to pay to ___________________________________, or registered assigns, the Principal Amount of __________________________ Dollars on ______, 2011. This Security shall not bear interest except as specified on the other side of this Security. Original Issue Discount will accrue as specified on the other side of this Security. This Security is convertible as specified on the other side of this Security. All capitalized terms used herein without definition shall have the respective meanings assigned thereto in the Indenture referred to on the other side of this Security. - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-2 Additional provisions of this Security are set forth on the other side of this Security. JACOR COMMUNICATIONS, INC. By: ________________________ Title: ATTEST: _______________________________ (Seal) TRUSTEE'S CERTIFICATE OF AUTHENTICATION ________________________________ as Trustee, certifies that this Security is one of the Securities referred to in the within-mentioned Indenture. By: __________________________________ Authorized Signatory Date: ________________________ A-3 [FORM OF REVERSE SIDE OF LYON] LIQUID YIELD OPTION-TM- NOTE DUE 2011 (ZERO COUPON -- SENIOR) 1. INTEREST This Security shall not bear interest except as specified in this paragraph. If the Principal Amount hereof or any portion of such Principal Amount is not paid when due (whether upon acceleration pursuant to Section 6.02 of the Indenture, upon the date set for payment of the Redemption Price pursuant to paragraph 5 hereof, upon the date set for payment of a Purchase Price or Change in Control Purchase Price pursuant to paragraph 6 hereof or upon the Stated Maturity of this Security) or if shares of Common Stock (or cash in lieu of fractional shares) in respect of a conversion of this Security in accordance with the terms of Article 10 of the Indenture is not delivered when due, then in each such case the overdue amount shall bear interest at the rate of __% per annum, compounded semiannually (to the extent that the payment of such interest shall be legally enforceable), which interest shall accrue from the date such overdue amount was due to the date payment of such amount, including interest thereon, has been made or duly provided for. All such interest shall be payable on demand. Original Issue Discount (the difference between the Issue Price and the Principal Amount of the Security), in the period during which a Security remains outstanding, shall accrue at __% per annum, on a semiannual bond equivalent basis using a 360-day year composed of twelve 30-day months, commencing on the Issue Date of this Security, and cease to accrue on the earlier of (a) the date on which the Principal Amount at Stated Maturity hereof or any portion of such Principal Amount at Stated Maturity becomes due and payable and (b) any Redemption Date, Conversion Date, Change in Control Purchase Date, Purchase Date or other date on which such Original Issue Discount shall cease to accrue in accordance with Section 2.08 of the Indenture. 2. METHOD OF PAYMENT Subject to the terms and conditions of the Indenture, Jacor Communications, Inc. (the "Company") will make payments in respect of the Securities to the persons who are registered Holders of Securities at the close of business on the Business Day preceding the Redemption Date or Stated Maturity, as the case may be, or at the close of business on a Purchase Date, Change in Control Purchase Date or Conversion Date, as the case may be. Holders must surrender Securities to a Paying Agent to collect such payments in respect of the Securities. The Company will pay cash amounts in money of The United States of America that at the time of payment is legal tender - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-4 for payment of public and private debts. However, the Company may make such cash payments in respect of a certificated Security, if applicable, by check payable in such money. 3. PAYING AGENT, CONVERSION AGENT AND REGISTRAR Initially, The Bank of New York, a New York banking corporation, as trustee (the "Trustee"), will act as Paying Agent, Conversion Agent and Registrar. The Company may appoint and change any Paying Agent, Conversion Agent, Registrar or co-registrar, upon notice to the Trustee and the Holders. The Company or any of its Subsidiaries or any of their Affiliates may act as Paying Agent, Conversion Agent, Registrar or co-registrar. 4. INDENTURE The Company issued the Securities under an Indenture, dated as of ______, 1996 (the "Indenture"), between the Company and the Trustee. The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended by the Trust Indenture Reform Act of 1990, and, as in effect on the date of the Indenture (the "TIA"), except as provided in Section 9.03 of the Indenture. Capitalized terms used herein or on the face hereof and not defined herein have the meanings ascribed thereto in the Indenture. The Securities are subject to all such terms, and Securityholders are referred to the Indenture and the TIA for a statement of those terms. The Securities are general unsecured obligations of the Company limited to the aggregate Principal Amount at Stated Maturity specified in Section 2.02 of the Indenture (subject to Section 2.07 of the Indenture). The Indenture does not limit other indebtedness of the Company, secured or unsecured. 5. REDEMPTION AT THE OPTION OF THE COMPANY No sinking fund is provided for the Securities. The Securities are redeemable as a whole, or from time to time in part, at any time at the option of the Company at the Redemption Prices set forth below, PROVIDED, that the Securities are not redeemable prior to ______, 2001. The table below shows the Redemption Prices of a Security per $1,000 Principal Amount at Stated Maturity on the dates shown below and at Stated Maturity, which prices reflect accrued Original Issue Discount calculated to each such date. The Redemption Price of a Security redeemed between such dates would include an additional amount reflecting the additional Original Issue Discount accrued from and including the next preceding date in the table through the actual Redemption Date. - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-5 (1) (2) (3) ACCRUED ORIGINAL LYON ISSUE REDEMPTION ISSUE DISCOUNT PRICE REDEMPTION DATE PRICE AT % (1) + (2) , 2001............. $___.__ $___.__ $___.__ , 2002............. ___.__ ___.__ ___.__ , 2003............. ___.__ ___.__ ___.__ , 2004............. ___.__ ___.__ ___.__ , 2005............. ___.__ ___.__ ___.__ , 2006............. ___.__ ___.__ ___.__ , 2007............. ___.__ ___.__ ___.__ , 2008............. ___.__ ___.__ ___.__ , 2009............. ___.__ ___.__ ___.__ , 2010............. ___.__ ___.__ ___.__ At maturity.............. ___.__ ___.__ 1,000.00 6. PURCHASE BY THE COMPANY AT THE OPTION OF THE HOLDER Subject to the terms and conditions of the Indenture, the Company shall become obligated to purchase, at the option of the Holder, the Securities held by such Holder on the following Purchase Dates and at the following Purchase Prices per $1,000 Principal Amount at Stated Maturity of such Securities, upon delivery of a Purchase Notice containing the information set forth in the Indenture, at any time from the opening of business on the date that is 20 Business Days prior to such Purchase Date until the close of business on such Purchase Date and upon delivery of the Securities to the Paying Agent by the Holder as set forth in the Indenture. Such Purchase Price (equal to the Issue Price plus accrued Original Issue Discount through such Purchase Date) may be paid, at the option of the Company, in cash or by the issuance and delivery of shares of Common Stock of the Company, or in any combination thereof. PURCHASE DATE PURCHASE PRICE __, 2001 $___.__ __, 2006 $___.__ Subject to the terms and conditions of the Indenture, if any Change in Control occurs on or prior to ______, 2001, the Company shall, at the option of the Holder, purchase all Securities for which a Change in Control Purchase Notice shall have been delivered as provided in the Indenture and not withdrawn, on the - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-6 date that is 35 Business Days after the occurrence of such Change in Control, for a Change in Control Purchase Price equal to the Issue Price plus accrued Original Issue Discount through the Change in Control Purchase Date, which Change in Control Purchase Price shall be paid in cash. Holders have the right to withdraw any Purchase Notice or Change in Control Purchase Notice, as the case may be, by delivering to the Paying Agent a written notice of withdrawal in accordance with the provisions of the Indenture prior to the close of business on the Purchase Date or Change in Control Purchase Date, as the case may be. If cash sufficient to pay the Purchase Price or Change in Control Purchase Price of all Securities or portions thereof to be purchased as of the Purchase Date or the Change in Control Purchase Date, as the case may be, is deposited with the Paying Agent on the Business Day following the Purchase Date or the Change in Control Purchase Date, as the case may be, Original Issue Discount ceases to accrue on such Securities (or portions thereof) on and after such date, and the Holders thereof shall have no other rights as such (other than the right to receive the Purchase Price or Change in Control Purchase Price, as the case may be, upon surrender of such Security). 7. 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 of Securities to be redeemed at the Holder's registered address. If money sufficient to pay the Redemption Price of all Securities (or portions thereof) to be redeemed on the Redemption Date is deposited with the Paying Agent prior to or on the Redemption Date, on and after such date Original Issue Discount ceases to accrue on such Securities or portions thereof. Securities in denominations larger than $1,000 of Principal Amount may be redeemed in part but only in integral multiples of $1,000 of Principal Amount. 8. CONVERSION Subject to the next two succeeding sentences, a Holder of a Security may convert it into Common Stock of the Company at any time before the close of business on ______, 2011; PROVIDED, HOWEVER, that if a Security is called for redemption, the Holder may convert it at any time before the close of business on the Redemption Date. The number of shares of Common Stock to be delivered upon conversion of a Security into Common Stock per $1,000 of Principal Amount shall be equal to the Conversion Rate. A Security in respect of which a Holder has delivered a Purchase - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-7 Notice or Change in Control Purchase Notice exercising the option of such Holder to require the Company to purchase such Security may be converted only if the notice of exercise is withdrawn in accordance with the terms of the Indenture. The initial Conversion Rate is ____ shares of Common Stock per $1,000 Principal Amount, subject to adjustment in certain events described in the Indenture. The Company will deliver cash or a check in lieu of any fractional share of Common Stock. To convert a Security a Holder must (i) complete and manually sign the conversion notice on the back of the Security (or complete and manually sign a facsimile of such notice) and deliver such notice to the Conversion Agent (or the office or agency referred to in Section 4.05 of the Indenture), (ii) furnish appropriate endorsements and transfer documents if required by the Conversion Agent, the Company or the Trustee and (iii) pay any transfer or similar tax, if required. If the Holder converts more than one Security at the same time, the number of shares of Common Stock issuable upon the conversion shall be based on the total Principal Amount of the Securities converted. A Holder may convert a portion of a Security if the Principal Amount of such portion is $1,000 or an integral multiple of $1,000. No payment or adjustment will be made for dividends on the Common Stock except as provided in the Indenture. On conversion of a Security, that portion of accrued Original Issue Discount attributable to the period from the Issue Date to the Conversion Date with respect to the converted Security shall not be cancelled, extinguished or forfeited, but rather shall be deemed paid in full to the Holder thereof through the delivery of the Common Stock in exchange for the Security being converted pursuant to the terms hereof; and the fair market value of such Common Stock (together with any cash payment in lieu of fractional shares of Common Stock) shall be treated as issued, to the extent thereof, first in exchange for Original Issue Discount accrued through the Conversion Date, and the balance, if any, of such fair market value of such shares of Common Stock (and any such cash payment) shall be treated as issued in exchange for the Issue Price of the Security being converted pursuant to the provisions hereof. The Conversion Rate will be adjusted for dividends or distributions on Common Stock payable in Common Stock or other Capital Stock; subdivisions, combinations or certain reclassifications of Common Stock; distributions to all holders of Common Stock of certain rights to purchase Common Stock for a period expiring within 60 days at less than the Sale Price at the Time - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-8 of Determination; and distributions to such holders of assets or debt securities of the Company or certain rights to purchase securities of the Company (excluding certain cash dividends or distributions). However, no adjustment need be made if Securityholders may participate in the transaction or in certain other cases. The Company from time to time may voluntarily increase the Conversion Rate. If the Company is a party to a consolidation, merger or binding share exchange of the type specified in the Indenture, or certain transfers of all or substantially all of its assets to another person, or in certain other circumstances described in the Indenture, the right to convert a Security into Common Stock may be changed into a right to convert it into securities, cash or other assets of the Company or another person. 9. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION Any Securities called for redemption, unless surrendered for conversion before the close of business on the Redemption Date, may be deemed to be purchased from the Holders of such Securities at an amount not less than the Redemption Price, together with accrued interest if any, to the Redemption Date, by one or more investment bankers or other purchasers who may agree with the Company to purchase such Securities from the Holders and to make payment for such Securities to the Trustee in trust for such Holders. 10. DENOMINATIONS; TRANSFER; EXCHANGE The Securities are in fully registered form, without coupons, in denominations of $250,000 of Principal Amount and integral multiples of $1,000. A Holder may transfer or exchange Securities in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Registrar need not transfer or exchange any Securities selected for redemption (except, in the case of a Security to be redeemed in part, the portion of the Security not to be redeemed) or any Securities in respect of which a Purchase Notice or Change in Control Purchase Notice has been given and not withdrawn (except, in the case of a Security to be purchased in part, the portion of the Security not to be purchased) or any Securities for a period of 15 days before a selection of Securities to be redeemed. - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-9 11. PERSONS DEEMED OWNERS The registered Holder of this Security may be treated as the owner of this Security for all purposes. 12. UNCLAIMED MONEY OR SECURITIES The Trustee and the Paying Agent shall return to the Company upon written request any money or securities held by them for the payment of any amount with respect to the Securities that remains unclaimed for two years, PROVIDED, HOWEVER, that the Trustee or such Paying Agent, before being required to make any such return, may at the expense of the Company cause to be published once in THE WALL STREET JOURNAL or another newspaper of national circulation or mail to each such Holder notice that such money or securities remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication or mailing, any unclaimed money or securities then remaining will be returned to the Company. After return to the Company, Holders entitled to the money or securities must look to the Company for payment as general creditors unless an applicable abandoned property law designates another person, and the Trustee and the Paying Agent shall have no further liability with respect to such money or securities for that period commencing after the return thereof. 13. AMENDMENT; WAIVER Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Securities may be amended with the written consent of the Holders of at least a majority in aggregate Principal Amount of the Securities at the time outstanding and (ii) certain defaults or noncompliance with certain provisions may be waived with the written consent of the Holders of a majority in aggregate Principal Amount of the Securities at the time outstanding. Subject to certain exceptions set forth in the Indenture, without the consent of any Securityholder, the Company and the Trustee may amend the Indenture or the Securities to cure any ambiguity, defect or inconsistency, or to comply with Article 5 or Section 10.14 of the Indenture or to make any change that does not adversely affect the rights of any Securityholder, or to comply with any requirement of the SEC in connection with the qualification of the Indenture under the TIA. 14. DEFAULTS AND REMEDIES Under the Indenture, Events of Default include (i) default in payment of the Principal Amount, Issue Price, accrued Original Issue Discount, Redemption Price, Purchase Price or Change in - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-10 Control Purchase Price, as the case may be, in respect of the Securities when the same becomes due and payable; (ii) failure either to deliver shares of Common Stock (or cash in lieu of fractional shares) in accordance with the terms of the Indenture when such Common Stock (or cash in lieu of fractional shares) is required to be delivered following conversion of a Security and such failure is not remedied for a period of 10 days; (iii) failure by the Company to comply with other agreements in the Indenture or the Securities, subject to notice and lapse of time; (iv) default (A) in the payment of any principal on any debt for borrowed money of the Company (excluding any non-recourse debt), in an aggregate principal amount in excess of $10 million when due at its final maturity after giving effect to any applicable grace period and the holder thereof shall have taken affirmative action to enforce the payment thereof, or (B) in the performance of any term or provision of any debt for borrowed money of the Company (excluding any non-recourse debt) in an aggregate principal amount in excess of $10 million that results in such debt becoming or being declared due and payable prior to the date on which it would otherwise become due and payable, unless, in the case of either clause (A) or (B) above, (x) such acceleration or action to enforce payment, as the case may be, has been rescinded or annulled, (y) such debt has been discharged or (z) a sum sufficient to discharge in full such debt has been deposited in trust by or on behalf of the Company, in each case, within a period of 10 days after there has been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the Securities, a written notice specifying such default or defaults and stating that such notice is a "Notice of Default" hereunder; or (v) certain events of bankruptcy or insolvency. If an Event of Default occurs and is continuing, the Trustee, or the Holders of at least 25% in aggregate Principal Amount of the Securities at the time outstanding, may declare all the Securities to be due and payable immediately. Certain events of bankruptcy or insolvency are Events of Default that will result in the Securities becoming due and payable immediately upon the occurrence of such Events of Default. Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may refuse to enforce the Indenture or the Securities unless it receives reasonable indemnity or security. Subject to certain limitations, Holders of a majority in aggregate Principal Amount of the Securities at the time outstanding may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Securityholders notice of any continuing Default (except a Default in payment of amounts specified in clause (i) above) if it determines that withholding notice is in their interests. - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-11 15. TRUSTEE DEALINGS WITH THE COMPANY Subject to certain limitations imposed by the TIA, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. 16. NO RECOURSE AGAINST OTHERS A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Security, each Securityholder waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities. 17. AUTHENTICATION This Security shall not be valid until an authorized signatory of the Trustee manually signs the Certificate of Authentication on the other side of this Security. 18. ABBREVIATIONS Customary abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with right of survivorship and not as tenants in common) and CUST (=custodian), and UNIF TRANS MIN ACT (=Uniform Transfers to Minors Act). 19. GOVERNING LAW THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND TO BE PERFORMED WITHIN THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. _______________________ The Company will furnish to any Securityholder upon written request and without charge a copy of the Indenture which has in it the text of this Security in larger type. Requests may be made to: - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-12 Jacor Communications, Inc. 1300 PNC Center 201 East Fifth Street Cincinnati, Ohio 45202 - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-13 ASSIGNMENT FORM CONVERSION NOTICE To assign this Security, fill To convert this Security into in the form below: Common Stock of the Company, check the box: I or we assign and transfer ----- this Security to : : : : ----- (Insert assignee's soc. sec. or tax ID no.) To convert only part of this Security, state the Principal ______________________________ Amount to be converted (which must be $1,000 or an integral ______________________________ multiple of $1,000): -------------------- ______________________________ :$ : -------------------- ______________________________ (Print or type assignee's name, address and zip code) If you want the stock certificate made out in and irrevocably appoint another person's name, fill ___________________ agent in the form below: to transfer this Security on the books of the Company. The ------------------- agent may substitute another : : to act for him. ------------------- (Insert person's soc. sec. or tax ID no.) ______________________________ ______________________________ ______________________________ ______________________________ (Print or type person's name, address and zip code) _________________________________________________________________ Date: Your Signature: * _________________________________________________________________ (Sign exactly as your name appears on the other side of this Security) * Your signature must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Registrar, which requirements include membership or participation in the Security - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-14 Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. - -------------------- TM Trademark of Merrill Lynch & Co., Inc. A-15 EX-5.1 4 EX-5.1 EXHIBIT 5.1 [GRAYDON, HEAD & RITCHEY LETTERHEAD] June __, 1996 Jacor Communications, Inc. 1300 PNC Center 201 East Fifth Street Cincinnati, Ohio 45202 Re: Sale of $258,750,000 Aggregate Principal Amount at Maturity of Liquid Yield Option Notes due 2011 of Jacor Communications, Inc. Pursuant to Registration Statement on Form S-3, File No. 333-02495, Filed with the Securities and Exchange Commission ------------------------------------------------------- Ladies and Gentlemen: We have acted as counsel to Jacor Communications, Inc. (the "Company"), an Ohio corporation, in connection with the registration of $258,750,000 Aggregate Principal Amount at Maturity of Liquid Yield Option Notes due 2011 of the Company (the "LYONs"), and the underlying shares of the Company's common stock, no par value, as may be required for issuance upon conversion of the LYONs (the "Conversion Shares"), all of which are being sold by the Company as set forth on the Form S-3 Registration Statement, File No. 333-02495, as amended, as filed by the Company with the Securities and Exchange Commission. As counsel for the Company we have made such legal and factual examinations and inquiries as we deem advisable for the purpose of rendering this opinion. In addition, we have examined such documents and materials, including the Amended and Restated Articles of Incorporation, as amended, the Amended and Restated Code of Regulations, as amended, and other corporate records of the Company, as we have deemed necessary for the purpose of this opinion. On the basis of the foregoing, we express the following opinions: (i) the LYONs, when authenticated in accordance with the terms of the indenture (the "Indenture") to be entered into between the Company and The Bank of New York, as trustee, a copy of which is filed as an exhibit to the Registration Statement, and delivered Jacor Communications, Inc. June __, 1996 Page 2 and paid for as contemplated by the Registration Statement, will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms and entitled to the benefits of the Indenture, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors's rights and remedies generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity) and except to the extent that a waiver of rights under any usury laws may be unenforceable; and (ii) the Conversion Shares of initially issuable upon conversion of the LYONs have been duly authorized and reserved for issuance upon conversion of the LYONs, are free of preemptive rights, and, when issued upon conversion of the LYONs in accordance with the terms of the Indenture, will be validly issued, fully paid and non-assessable. We hereby consent to the filing of this opinion as part of the above-referenced Registration Statement and amendments thereto and to the reference to our firm in both the preliminary and final Prospectus under the caption "Legal Matters." Very truly yours, GRAYDON, HEAD & RITCHEY By: ____________________________________ Richard G. Schmalzl -----END PRIVACY-ENHANCED MESSAGE-----