Document:

Sinclair Indenture

INDENTURE, dated as of March 14, 2002, among SINCLAIR BROADCAST GROUP,

INC., a Maryland corporation (the “Company”), the Guarantors identified on

Annex A hereto (collectively, the “Guarantors”), and FIRST UNION NATIONAL BANK,

a national banking association organized under the laws of the United States of

America, as trustee (the “Trustee”).

 

RECITALS OF THE COMPANY

 

The Company has duly authorized the creation of an issue of 8% Senior

Subordinated Notes due 2012, Series A (the “Initial Securities” or the “Series A

Securities”), and an issue of 8% Senior Subordinated Notes due 2012,

Series B (the “Series B Securities” and, together with the Series A

Securities, the “Securities”) of substantially the tenor and amount hereinafter

set forth, and to provide therefor the Company has duly authorized the

execution and delivery of this Indenture and the Securities.

 

Each Guarantor has duly authorized the issuance of a guarantee (the

“Guarantees”) of the Securities, of substantially the tenor hereinafter set

forth, and to provide therefor, each Guarantor has duly authorized the

execution and delivery of this Indenture and the Guarantee.

 

This Indenture is subject to, and shall be governed by, the provisions

of the Trust Indenture Act that are required to be part of and to govern

indentures qualified under the Trust Indenture Act.

 

All acts and things necessary have been done to make (i) the

Securities, when executed by the Company and authenticated and delivered

hereunder and duly issued by the Company, the valid obligations of the Company,

(ii) the Guarantees, when executed by each of the Guarantors and delivered

hereunder, the valid obligation of each of the Guarantors and (iii) this

Indenture a valid agreement of the Company and each of the Guarantors in accordance

with the terms of this Indenture.

 

NOW, THEREFORE,

THIS INDENTURE WITNESSETH:

 

For and in consideration of the premises and the purchase of the

Securities by the Holders thereof, it is mutually covenanted and agreed, for

the equal and proportionate benefit of all Holders of the Securities, as

follows:

 

 

ARTICLE ONE

 

DEFINITIONS AND OTHER PROVISIONS OF

GENERAL APPLICATION

 

Section 101.  Definitions.

 

For all purposes of this Indenture, except as otherwise expressly

provided or unless the context otherwise requires:

 

(a)           the terms defined in

this Article have the meanings assigned to them in this Article, and include

the plural as well as the singular;

 

(b)           all other terms used

herein which are defined in the Trust Indenture Act, either directly or by

reference therein, have the meanings assigned to them therein;

 

(c)           all accounting terms

not otherwise defined herein have the meanings assigned to them in accordance

with GAAP;

 

(d)           the words “herein”,

“hereof” and “hereunder” and other words of similar import refer to this

Indenture as a whole and not to any particular Article, Section or other

subdivision; and

 

(e)           all references to $,

US$, dollars or United States dollars shall refer to the lawful currency of the

United States of America.

 

“Acquired

Indebtedness”

means Indebtedness of a Person (i) existing at the time such Person

becomes a Subsidiary or (ii) assumed in connection with the acquisition of

assets from such Person, in each case, other than Indebtedness incurred in

connection with, or in contemplation of, such Person becoming a Subsidiary or

such acquisition.  Acquired Indebtedness

shall be deemed to be incurred on the date of the related acquisition of assets

from any Person or the date the acquired Person becomes a Subsidiary.

 

“Affiliate” means, with respect to any specified

Person, (i) any other Person directly or indirectly controlling or

controlled by or under direct or indirect common control with such specified

Person, (ii) any other Person that owns, directly or indirectly, 5% or more

of such Person’s Equity Interests or any officer or director of any such Person

or other Person or, with respect to any natural Person, any Person having a

relationship with such Person or other Person by blood, marriage or adoption

not more remote than first cousin or (iii) any other Person 10% or more of

the voting Equity Interests of which are beneficially owned or held directly or

indirectly by such specified Person. 

For the purposes of this definition, “control” when used with respect to

any specified Person means the power to direct the management and policies of

such Person directly or

 

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indirectly, whether through ownership of voting securities, by contract

or otherwise; and the terms “controlling” and “controlled” have meanings

correlative to the foregoing.

 

“Agent Member”

means any member of, or participant in, the Depositary.

 

“Applicable Procedures” means, with respect to any

transfer or transaction involving a Global Security or beneficial interests therein,

the rules and procedures of the Depositary for such Security, Euroclear and/or

Clearstream, in each case to the extent applicable to such transaction and as

in effect at the time of such transfer or transaction.

 

“Asset

Sale” means any sale, issuance, conveyance, transfer, lease

or other disposition (including, without limitation, by way of merger,

consolidation or Sale and Leaseback Transaction) (collectively, a “transfer”),

directly or indirectly, in one or a series of related transactions, of (i) any

Equity Interest of any Restricted Subsidiary; (ii) all or substantially

all of the properties and assets of any division or line of business of the

Company or its Restricted Subsidiaries; or (iii) any other properties or

assets of the Company or any Restricted Subsidiary, other than in the ordinary

course of business.  For the purposes of

this definition, the term “Asset Sale” shall not include any transfer of

properties and assets (A) that is governed by Section 801(a),

(B) that is by the Company to any Wholly Owned Restricted Subsidiary, or

by any Restricted Subsidiary to the Company or any Wholly Owned Restricted

Subsidiary in accordance with the terms of this Indenture or (C) that

aggregates not more than $10,000,000 in gross proceeds.

 

“Asset

Swap”

means an Asset Sale by the Company or any Restricted Subsidiary in exchange for

properties or assets that will be used in the business of the Company and its

Restricted Subsidiaries existing on the date of this Indenture or reasonably

related thereto.

 

“Average

Life to Stated Maturity” means, as of the date of determination with respect

to any Indebtedness, the quotient obtained by dividing (i) the sum of the

products of (a) the number of years from the date of determination to the

date or dates of each successive scheduled principal payment of such

Indebtedness multiplied by (b) the amount of each such principal payment

by (ii) the sum of all such principal payments.

 

“Bank Credit

Agreement”

means the Credit Agreement, dated as of May 28, 1998, between the Company,

the subsidiaries of the Company identified on the signature pages thereof under

the caption “SUBSIDIARY GUARANTORS,” the lenders named therein and The Chase

Manhattan Bank, as agent, as amended by Amendment No. 1 dated as of December

21, 1999 and Amendment No. 2 dated as of July 21, 2000, and as amended and

restated pursuant to an Amendment and Restatement dated as of May 9, 2001, as

amended by Amendment No. 1 dated as of October 30, 2001, and as such agreement

may be further amended, renewed, extended, substituted, refinanced,

restructured, replaced, supplemented or otherwise modified from time to time

(including,

 

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without limitation, any successive renewals, extensions, substitutions,

refinancings, restructurings, replacements, supplementations or other

modifications of the foregoing).  For

all purposes under this Indenture, “Bank Credit Agreement” shall include any

amendments, renewals, extensions, substitutions, refinancings, restructurings,

replacements, supplements or any other modifications that increase the

principal amount of the Indebtedness or the commitments to lend thereunder and

have been made in compliance with Section 1008; provided that, for

purposes of the definition of “Permitted Indebtedness,” no such increase may

result in the principal amount of Indebtedness of the Company under the Bank

Credit Agreement exceeding the amount permitted by Section 1008(b)(i).

 

“Bankruptcy Law” means Title 11, United States Bankruptcy

Code of 1978, as amended, or any similar United States federal or state law

relating to bankruptcy, insolvency, receivership, winding-up, liquidation,

reorganization or relief of debtors or any amendment to, succession to or

change in any such law.

 

“Board

of Directors”

means the board of directors of the Company or any Guarantor, as the case may

be, or any duly authorized committee of such board.

 

“Board Resolution” means a copy of a resolution certified

by the Secretary or an Assistant Secretary of the Company or any Guarantor, as

the case may be, to have been duly adopted by the Board of Directors of such

entity and to be in full force and effect on the date of such certification,

and delivered to the Trustee.

 

“Business

Day” means

each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on

which banking institutions in The City of New York, the State of Maryland or

the city in which the Corporate Trust Office is located are authorized or

obligated by law or executive order to close.

 

“Capital

Lease Obligation”

means any obligation of the Company and its Restricted Subsidiaries on a

Consolidated basis under any capital lease of real or personal property which,

in accordance with GAAP, has been recorded as a capitalized lease obligation.

 

“Cash Equivalents” means, (i) any evidence of

Indebtedness with a maturity of one year or less from the date of acquisition

issued or directly and fully guaranteed or insured by the United States of

America or any agency or instrumentality thereof (provided that the full

faith and credit of the United States of America is pledged in support

thereof); (ii) certificates of deposit or acceptances with a maturity of

one year or less from the date of acquisition of any financial institution that

is a member of the Federal Reserve System having combined capital and surplus

and undivided profits of not less than $500,000,000; (iii) commercial

paper with a maturity of one year or less from the date of acquisition issued

by a corporation that is not an Affiliate of the Company 

 

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organized under the laws of any state of the United States or the

District of Columbia and rated A-1 (or higher) according to S&P or P-1 (or

higher) according to Moody’s or at least an equivalent rating category of

another nationally recognized securities rating agency; (iv) any money

market deposit accounts issued or offered by a domestic commercial bank having

capital and surplus in excess of $500,000,000; and (v) repurchase

agreements and reverse repurchase agreements relating to marketable direct

obligations issued or unconditionally guaranteed by the government of the

United States of America or issued by any agency thereof and backed by the full

faith and credit of the United States of America, in each case maturing within

one year from the date of acquisition; provided that the terms of such

agreements comply with the guidelines set forth in the Federal Financial

Agreements of Depository Institutions With Securities Dealers and Others, as

adopted by the Comptroller of the Currency on October 31, 1985.

 

“Change of Control” means the occurrence of any of the

following events:  (i) any “person”

or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange

Act), other than Permitted Holders, is or becomes the “beneficial owner” (as

defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a Person

shall be deemed to have beneficial ownership of all shares that such Person has

the right to acquire, whether such right is exercisable immediately or only

after the passage of time), directly or indirectly, of more than 40% of the

total outstanding Voting Stock of the Company, provided that the

Permitted Holders “beneficially own” (as so defined) a lesser percentage of

such Voting Stock than such other Person and do not have the right or ability

by voting power, contract or otherwise to elect or designate for election a

majority of the Board of Directors of the Company; (ii) during any period

of two consecutive years, individuals who at the beginning of such period

constituted the Board of Directors of the Company (together with any new

directors whose election to such Board or whose nomination for election by the

shareholders of the Company, was approved by a vote of at least 66-2/3% of the

directors then still in office who were either directors at the beginning of

such period or whose election or nomination for election was previously so

approved) cease for any reason to constitute a majority of such Board of

Directors then in office; (iii) the Company consolidates with or merges

with or into any Person or conveys, transfers or leases all or substantially

all of its assets to any Person, or any corporation consolidates with or merges

into or with the Company, in any such event pursuant to a transaction in which

the outstanding Voting Stock of the Company is changed into or exchanged for

cash, securities or other property, other than any such transaction where the

outstanding Voting Stock of the Company is not changed or exchanged at all (except

to the extent necessary to reflect a change in the jurisdiction of

incorporation of the Company) or where (A) the outstanding Voting Stock of

the Company is changed into or exchanged for (x) Voting Stock of the

surviving corporation which is not Disqualified Equity Interests or

(y) cash, securities and other property (other than Equity Interests of

the surviving corporation) in an amount which could be paid by the Company as a

Restricted Payment in accordance with Section 1009 (and such amount shall be treated

as

 

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a Restricted Payment subject to the provisions described under Section

1009) and (B) no “person” or “group” other than Permitted Holders owns

immediately after such transaction, directly or indirectly, more than the

greater of (1) 40% of the total outstanding Voting Stock of the surviving

corporation and (2) the percentage of the outstanding Voting Stock of the

surviving corporation owned, directly or indirectly, by Permitted Holders

immediately after such transaction; or (iv) the Company is liquidated or

dissolved or adopts a plan of liquidation or dissolution other than in a

transaction which complies with the provisions described under Article Eight.

 

“Clearstream” means Clearstream Banking, societe

anonyme, or any successor securities clearing agency.

 

“Code” means the Internal Revenue Code of 1986,

as amended.

 

“Commission” means the Securities and Exchange

Commission, as from time to time constituted, created under the Exchange Act,

or if at any time after the execution of this Indenture such Commission is not

existing and performing the duties now assigned to it under the Trust Indenture

Act, then the body performing such duties at such time.

 

“Company”  means Sinclair Broadcast Group, Inc., a

corporation incorporated under the laws of Maryland, until a successor Person

shall have become such pursuant to the applicable provisions of this Indenture,

and thereafter “Company” shall mean such successor Person.

 

“Company Request”

or “Company Order” means a written request or order signed in the name of the Company by

any one of its Chairman of the Board, its Vice Chairman, its President or a

Vice President (regardless of vice presidential designation), and by any one of

its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary,

and delivered to the Trustee.

 

“Consolidated

Interest Expense” means, without duplication, for any period, the sum

of (a) the interest expense of the Company and its Consolidated Restricted

Subsidiaries for such period, on a Consolidated basis, including, without

limitation, (i) amortization of debt discount, (ii) the net cost

under interest rate contracts (including amortization of discounts),

(iii) the interest portion of any deferred payment obligation and

(iv) accrued interest, plus (b) the interest component of the Capital

Lease Obligations paid, accrued and/or scheduled to be paid or accrued by the

Company during such period, and all capitalized interest of the Company and its

Consolidated Restricted Subsidiaries, in each case as determined in accordance

with GAAP consistently applied.

 

“Consolidated Net

Income (Loss)” means, for any period, the Consolidated net income

(or loss) of the Company and its Consolidated Restricted Subsidiaries for such

period as determined in accordance with GAAP consistently applied, adjusted, to

the 

 

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extent included in calculating such net income (or loss), by excluding,

without duplication, (i) all extraordinary gains but not losses (less all

fees and expenses relating thereto), (ii) the portion of net income (or

loss) of the Company and its Consolidated Restricted Subsidiaries allocable to

interests in unconsolidated Persons or Unrestricted Subsidiaries, except to the

extent of the amount of dividends or distributions actually paid to the Company

or its Consolidated Restricted Subsidiaries by such other Person during such

period, (iii) net income (or loss) of any Person combined with the Company

or any of its Restricted Subsidiaries on a “pooling of interests” basis

attributable to any period prior to the date of combination, (iv) any gain

or loss, net of taxes, realized upon the termination of any employee pension

benefit plan, (v) net gains but not losses (less all fees and expenses

relating thereto) in respect of dispositions of assets other than in the

ordinary course of business, or (vi) the net income of any Restricted

Subsidiary to the extent that the declaration of dividends or similar

distributions by that Restricted Subsidiary of that income is not at the time

permitted, directly or indirectly, by operation of the terms of its charter or

any agreement, instrument, judgment, decree, order, statute, rule or

governmental regulation applicable to that Restricted Subsidiary or its

shareholders.

 

“Consolidated Net

Worth”

means the Consolidated equity of the holders of Equity Interests (excluding

Disqualified Equity Interests) of the Company and its Restricted Subsidiaries,

as determined in accordance with GAAP consistently applied.

 

“Consolidation” means, with respect to any Person, the

consolidation of the accounts of such Person and each of its subsidiaries

(other than any Unrestricted Subsidiaries) if and to the extent the accounts of

such Person and each of its subsidiaries (other than any Unrestricted

Subsidiaries) would normally be consolidated with those of such Person, all in

accordance with GAAP consistently applied. 

The term “Consolidated” shall have a similar meaning.

 

“Corporate Trust

Office” means the office of the Trustee or an affiliate or

agent thereof at which at any particular time the corporate trust business for

the purposes of this Indenture shall be principally administered, which office

at the date of execution of this Indenture is located at First Union National

Bank, 901 East Cary Street, 2nd Floor, Richmond, Virginia 23219,

Attention: Patricia Welling.

 

“Cumulative

Consolidated Interest Expense” means, as of any date of determination,

Consolidated Interest Expense from September 30, 1993 to the end of the

Company’s most recently ended full fiscal quarter prior to such date, taken as

a single accounting period.

 

“Cumulative

Operating Cash Flow” means, as of any date of determination, Operating

Cash Flow from September 30, 1993 to the end of the Company’s most recently

ended full fiscal quarter prior to such date, taken as a single accounting

period.

 

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“Debt to Operating

Cash Flow Ratio” means, as of any date of determination, the ratio of

(a) the aggregate principal amount of all outstanding Indebtedness of the

Company and its Restricted Subsidiaries as of such date on a Consolidated basis

plus the aggregate liquidation preference or redemption amount of all

Disqualified Equity Interests of the Company (excluding any such Disqualified

Equity Interests held by the Company or a Wholly Owned Restricted Subsidiary of

the Company), to (b) Operating Cash Flow of the Company and its Restricted

Subsidiaries on a Consolidated basis for the four most recent full fiscal

quarters ending immediately prior to such date, determined on a pro forma basis

(and after giving pro forma effect to (i) the incurrence of such

Indebtedness and (if applicable) the application of the net proceeds therefrom,

including to refinance other Indebtedness, as if such Indebtedness was

incurred, and the application of such proceeds occurred, at the beginning of

such four-quarter period; (ii) the incurrence, repayment or retirement of

any other Indebtedness by the Company and its Restricted Subsidiaries since the

first day of such four-quarter period as if such Indebtedness was incurred,

repaid or retired at the beginning of such four-quarter period (except that, in

making such computation, the amount of Indebtedness under any revolving credit facility

shall be computed based upon the average balance of such Indebtedness at the

end of each month during such four-quarter period); (iii) in the case of

Acquired Indebtedness, the related acquisition, as if such acquisition had

occurred at the beginning of such four-quarter period; and (iv) any

acquisition or disposition by the Company and its Restricted Subsidiaries of

any company or any business or any assets out of the ordinary course of

business, or any related repayment of Indebtedness, in each case since the

first day of such four-quarter period, assuming such acquisition or disposition

had been consummated on the first day of such four-quarter period).

 

“Default” means any event which is, or after

notice or passage of any time or both would be, an Event of Default.

 

“Depositary” means, with respect to the Securities

issued in the form of Global Securities, if any, The Depository Trust Company,

a New York limited purpose corporation, its nominees and successors, or any

other Person designated as the Depositary by the Company pursuant to

Section 305(b), in each case registered as a “clearing agency” under the

Exchange Act and maintaining a book-entry system that qualifies for treatment

as “registered form” under Section 163(f) of the Code.

 

“Designated

Guarantor Senior Indebtedness” means (i) all Guarantor Senior

Indebtedness which guarantees Indebtedness under the Bank Credit Agreement and

(ii) any other Guarantor Senior Indebtedness which is incurred pursuant to

an agreement (or series of related agreements) simultaneously entered into

providing for indebtedness, or commitments to lend, of at least $25,000,000 at

the time of determination and is specifically designated in the instrument

evidencing such Guarantor Senior Indebtedness or the agreement under which such

Senior Indebtedness arises as “Designated Guarantor

 

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Senior Indebtedness” by the Guarantor which is the obligor under the

Guarantor Senior Indebtedness.

 

“Designated Senior

Indebtedness” means (i) all Senior Indebtedness outstanding

under the Bank Credit Agreement and (ii) any other Senior Indebtedness

which is incurred pursuant to an agreement (or series of related agreements)

simultaneously entered into providing for indebtedness, or commitments to lend,

of at least $25,000,000 at the time of determination and is specifically

designated in the instrument evidencing such Senior Indebtedness or the

agreement under which such Senior Indebtedness arises as “Designated Senior

Indebtedness” by the Company.

 

“Disqualified

Equity Interests” means any Equity Interests that, either by their

terms or by the terms of any security into which they are convertible or

exchangeable or otherwise, are, or upon the happening of an event or passage of

time would be, required to be redeemed prior to any Stated Maturity of the

principal of the Securities or are redeemable at the option of the holder

thereof at any time prior to any such Stated Maturity (other than upon a change

of control of or sale of assets by the Company in circumstances where the

holders of the Securities would have similar rights), or are convertible into

or exchangeable for debt securities at any time prior to any such Stated

Maturity at the option of the holder thereof.

 

“Equity Interest” of any Person means any and all shares,

interests, rights to purchase, warrants, options, participations or other

equivalents of or interests in (however designated) corporate stock or other

equity participations, including partnership interests, whether general or

limited, of such Person, including any Preferred Equity Interests.

 

“Euroclear” means the Euroclear Clearance System or

any successor securities clearing agency.

 

“Event of Default” has the meaning specified in Article

Five.

 

“Exchange Act” means the Securities Exchange Act of

1934, as amended.

 

“Exchange Offer” means the exchange offer by the Company

of Series B Securities for Series A Securities to be effected pursuant to

Section 2(a) of the Registration Rights Agreement.

 

“Exchange Offer

Registration Statement” means the registration statement under the Securities

Act contemplated by Section 2(a) of the Registration Rights Agreement.

 

“Fair Market Value” means, with respect to any asset or

property, the sale value that would be obtained in an arm’s-length transaction

between an informed and

 

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willing seller under no compulsion to sell and an informed and willing

buyer under no compulsion to buy.

 

“Film Contract” means contracts with suppliers that convey the right

to broadcast specified films, videotape motion pictures, syndicated television

programs or sports or other programming.

 

“Founders’ Notes” means the term notes, dated

September 30, 1990, made by the Company to Julian S. Smith and to Carolyn

C. Smith pursuant to a stock redemption agreement, dated June 19, 1990,

among the Company, certain of its Subsidiaries, Julian S. Smith, Carolyn C.

Smith, David D. Smith, Frederick G. Smith, J. Duncan Smith and Robert E.

Smith.

 

“Generally

Accepted Accounting Principles” or “GAAP” means generally accepted accounting

principles in the United States, consistently applied, which are in effect on

the date of this Indenture.

 

“Global Security” means a Security in book-entry form in

the form prescribed in Sections 202 through 205 evidencing all or part of

the Securities, issued to the Depositary or its nominee and registered in the

name of the Depositary or such nominee.

 

“Guarantee” means the guarantee by any Guarantor of

the Company’s Indenture Obligations pursuant to a guarantee given in accordance

with this Indenture, including, without limitation, the Guarantees by the

Guarantors included in Article Fourteen of this Indenture and any Guarantee

delivered pursuant to Section 1014.

 

“Guaranteed Debt” of any Person means, without

duplication, all Indebtedness of any other Person referred to in the definition

of Indebtedness contained in this Section guaranteed directly or indirectly in

any manner by such Person, or in effect guaranteed directly or indirectly by such

Person through an agreement (i) to pay or purchase such Indebtedness or to

advance or supply funds for the payment or purchase of such Indebtedness,

(ii) to purchase, sell or lease (as lessee or lessor) property, or to

purchase or sell services, primarily for the purpose of enabling the debtor to

make payment of such Indebtedness or to assure the holder of such Indebtedness

against loss, (iii) to supply funds to, or in any other manner invest in,

the debtor (including any agreement to pay for property or services without

requiring that such property be received or such services be rendered),

(iv) to maintain working capital or equity capital of the debtor, or

otherwise to maintain the net worth, solvency or other financial condition of

the debtor or (v) otherwise to assure a creditor against loss; provided

that the term “guarantee” shall not include endorsements for collection or

deposit, in either case in the ordinary course of business.

 

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“Guarantor” means the Subsidiaries listed as

guarantors in this Indenture or any other guarantor of the Indenture

Obligations.

 

“Guarantor Senior

Indebtedness” is defined as the principal of, premium, if any, and

interest (including interest accruing after the filing of a petition initiating

any proceeding under any state, federal or foreign bankruptcy laws whether or

not allowable as a claim in such proceeding) on any Indebtedness of any

Guarantor (other than as otherwise provided in this definition), whether outstanding

on the date of this Indenture or thereafter created, incurred or assumed, and

whether at any time owing, actually or contingent, unless, in the case of any

particular Indebtedness, the instrument creating or evidencing the same or

pursuant to which the same is outstanding expressly provides that such

Indebtedness shall not be senior in right of payment to any Guarantee.  Without limiting the generality of the

foregoing, “Guarantor Senior Indebtedness” shall include (i) the principal

of, premium, if any, and interest (including interest accruing after the filing

of a petition initiating any proceeding under any state, federal or foreign

bankruptcy law whether or not allowable as a claim in such proceeding) and all

other obligations of every nature of any Guarantor from time to time owed to

the lenders (or their agent) under the Bank Credit Agreement; provided, however,

that any Indebtedness under any refinancing, refunding or replacement of the

Bank Credit Agreement shall not constitute Guarantor Senior Indebtedness to the

extent that the Indebtedness thereunder is by its express terms subordinate to

any other Indebtedness of any Guarantor, (ii) Indebtedness evidenced by any

guarantee of the Founders’ Notes and (iii) Indebtedness under Interest Rate

Agreements.  Notwithstanding the

foregoing, “Guarantor Senior Indebtedness” shall not include

(i) Indebtedness evidenced by the Guarantees, (ii) Indebtedness that

is subordinate or junior in right of payment to any Indebtedness of any

Guarantor, (iii) Indebtedness which when incurred and without respect to

any election under Section 1111(b) of Title 11 of the United States Code,

is without recourse to any Guarantor, (iv) Indebtedness which is

represented by Disqualified Equity Interests, (v) any liability for foreign,

federal, state, local or other taxes owed or owing by any Guarantor to the

extent such liability constitutes Indebtedness, (vi) Indebtedness of any

Guarantor to a Subsidiary or any other Affiliate of the Company or any of such

Affiliate’s subsidiaries, (vii) Indebtedness evidenced by any guarantee of

any Subordinated Indebtedness or Pari Passu Indebtedness, (viii) that

portion of any Indebtedness which at the time of issuance is issued in

violation of this Indenture, and (ix) Indebtedness owed by any Guarantor for

compensation to employees or for services.

 

“Holder” means a Person in whose name a Security

is registered in the Security Register.

 

“Indebtedness” means, with respect to any Person,

without duplication, (i) all indebtedness of such Person for borrowed

money or for the deferred purchase price of property or services, excluding any

trade payables and other accrued current liabilities 

 

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arising in the ordinary course of business, but including, without

limitation, all obligations, contingent or otherwise, of such Person in

connection with any letters of credit issued under letter of credit facilities,

acceptance facilities or other similar facilities and in connection with any

agreement to purchase, redeem, exchange, convert or otherwise acquire for value

any Equity Interests of such Person, or any warrants, rights or options to

acquire such Equity Interests, now or hereafter outstanding, (ii) all

obligations of such Person evidenced by bonds, notes, debentures or other

similar instruments, (iii) all indebtedness created or arising under any

conditional sale or other title retention agreement with respect to property

acquired by such Person (even if the rights and remedies of the seller or

lender under such agreement in the event of default are limited to repossession

or sale of such property), but excluding trade payables arising in the ordinary

course of business, (iv) all obligations under Interest Rate Agreements of

such Person, (v) all Capital Lease Obligations of such Person,

(vi) all Indebtedness referred to in clauses (i) through (v) above of

other Persons and all dividends of other Persons, the payment of which is

secured by (or for which the holder of such Indebtedness has an existing right,

contingent or otherwise, to be secured by) any Lien, upon or with respect to

property (including, without limitation, accounts and contract rights) owned by

such Person, even though such Person has not assumed or become liable for the

payment of such Indebtedness, (vii) all Guaranteed Debt of such Person,

(viii) all Disqualified Equity Interests valued at the greater of their

voluntary or involuntary maximum fixed repurchase price plus accrued and unpaid

dividends, and (ix) any amendment, supplement, modification, deferral,

renewal, extension, refunding or refinancing of any liability of the types

referred to in clauses (i) through (viii) above; provided, however,

that the term Indebtedness shall not include (1) any obligations of the Company

and its Restricted Subsidiaries with respect to Film Contracts entered into in

the ordinary course of business and (2) the $200 million aggregate liquidation

value of the 11 5/8% High Yield Trust Offered Preferred Securities of Sinclair

Capital (the “HYTOPS”) and any other similar instruments issued to replace or

refinance the HYTOPS.  The amount of

Indebtedness of any Person at any date shall be, without duplication, the

principal amount that would be shown on a balance sheet of such Person prepared

as of such date in accordance with GAAP and the maximum determinable liability

of any Guaranteed Debt referred to in clause (vii) above at such date.  The Indebtedness of the Company and its

Restricted Subsidiaries shall not include any Indebtedness of Unrestricted

Subsidiaries so long as such Indebtedness is non-recourse to the Company and

the Restricted Subsidiaries.  For

purposes hereof, the “maximum fixed repurchase price” of any Disqualified

Equity Interests which do not have a fixed repurchase price shall be calculated

in accordance with the terms of such Disqualified Equity Interests as if such

Disqualified Equity Interests were purchased on any date on which Indebtedness

shall be required to be determined pursuant to this Indenture, and if such

price is based upon, or measured by, the Fair Market Value of such Disqualified

Equity Interests, such Fair Market Value to be determined in good faith by the

Board of Directors of the issuer of such Disqualified Equity Interests.

 

12

 

“Indenture” means this instrument as originally

executed and as it may from time to time be supplemented or amended by one or

more indentures supplemental hereto entered into pursuant to the applicable

provisions hereof, including, for all purposes of this instrument and any such

supplemental indenture, the provisions of the Trust Indenture Act that are

deemed to be a part of and govern this instrument and any such supplemental

indenture, respectively.

 

“Indenture

Obligations” means the obligations of the Company and any other

obligor under this Indenture or under the Securities, including any Guarantor,

to pay principal, premium, if any, and interest when due and payable, and all

other amounts due or to become due under or in connection with this Indenture,

the Securities and the performance of all other obligations to the Trustee and

the Holders under this Indenture and the Securities, according to the terms

hereof and thereof.

 

“Independent Director” means a director of the Company other

than a director (i) who (apart from being a director of the Company or any

Subsidiary) is an employee, insider, associate or Affiliate of the Company or a

Subsidiary or has held any such position during the previous five years or

(ii) who is a director, an employee, insider, associate or Affiliate of

another party to the transaction in question.

 

“Initial Purchasers” shall mean First Union Securities, Inc.,

Deutsche Banc Alex. Brown Inc. and J.P. Morgan Securities Inc., as initial

purchasers of the Securities.

 

“Initial Securities “has the meaning specified in the

Recitals.

 

“Interest Payment Date” means the Stated Maturity of an

installment of interest on the Securities.

 

“Interest Rate

Agreements” means one or more of the following agreements which

shall be entered into by one or more financial institutions:  interest rate protection agreements

(including, without limitation, interest rate swaps, caps, floors, collars and

similar agreements) and any obligations in respect of any Hedging Agreements

(as defined in the Bank Credit Agreement).

 

“Investments” means, with respect to any Person,

directly or indirectly, any advance, loan (including guarantees), or other

extension of credit or capital contribution to (by means of any transfer of

cash or other property to others or any payment for property or services for

the account or use of others), or any purchase, acquisition or ownership by

such Person of any Equity Interests, bonds, notes, debentures or other

securities or assets issued or owned by any other Person and all other items

that would be classified as investments on a balance sheet prepared in

accordance with GAAP.

 

“Issue Date” means March 14, 2002.

 

13

 

“Lien” means any mortgage, charge, pledge, lien

(statutory or otherwise), privilege, security interest, hypothecation or other

encumbrance upon or with respect to any property of any kind (including any

conditional sale or other title retention agreement, any leases in the nature

thereof, and any agreement to give any security interest), real or personal,

movable or immovable, now owned or hereafter acquired.

 

“Local Marketing

Agreement” means a local marketing arrangement, sale agreement,

time brokerage agreement, management agreement or similar arrangement pursuant

to which a Person (i) obtains the right to sell at least a majority of the

advertising inventory of a television station on behalf of a third party,

(ii) purchases at least a majority of the air time of a television station

to exhibit programming and sell advertising time, (iii) manages the

selling operations of a television station with respect to at least a majority

of the advertising inventory of such station, (iv) manages the acquisition of

programming for a television station, (v) acts as a program consultant for a

television station, or (vi) manages the operation of a television station

generally.

 

“Maturity”, when used with respect to any Security,

means the date on which the principal of such Security becomes due and payable

as therein provided or as provided in this Indenture, whether at Stated

Maturity, the Offer Date, or the Redemption Date and whether by declaration of

acceleration, Offer in respect of Excess Proceeds, Change of Control, call for

redemption or otherwise.

 

“Moody’s” means Moody’s Investors Service, Inc. or

any successor rating agency.

 

“Net Cash Proceeds” means (a) with respect to any Asset

Sale by any Person, the proceeds thereof in the form of cash or Temporary Cash

Investments including payments in respect of deferred payment obligations when

received in the form of, or stock or other assets when disposed of for, cash or

Temporary Cash Investments (except to the extent that such obligations are

financed or sold with recourse to the Company or any Restricted Subsidiary) net

of (i) brokerage commissions and other reasonable fees and expenses

(including fees and expenses of counsel and investment bankers) related to such

Asset Sale, (ii) provisions for all taxes payable as a result of such

Asset Sale, (iii) payments made to retire Indebtedness where payment of

such Indebtedness is secured by the assets or properties the subject of such

Asset Sale, (iv) amounts required to be paid to any Person (other than the

Company or any Restricted Subsidiary) owning a beneficial interest in the assets

subject to the Asset Sale and (v) appropriate amounts to be provided by

the Company or any Restricted Subsidiary, as the case may be, as a reserve, in

accordance with GAAP, against any liabilities associated with such Asset Sale

and retained by the Company or any Restricted Subsidiary, as the case may be,

after such Asset Sale, including, without limitation, pension and other

post-employment benefit liabilities, liabilities related to environmental

matters and liabilities under any indemnification obligations associated with

such Asset Sale, all as reflected in an

 

14

 

Officers’ Certificate delivered to the Trustee and (b) with

respect to any issuance or sale of Equity Interests, or debt securities or Equity

Interests that have been converted into or exchanged for Equity Interests, as

referred to under Section 1009, the proceeds of such issuance or sale in the

form of cash or Temporary Cash Investments, including payments in respect of

deferred payment obligations when received in the form of, or stock or other

assets when disposed for, cash or Temporary Cash Investments (except to the

extent that such obligations are financed or sold with recourse to the Company

or any Restricted Subsidiary), net of attorney’s fees, accountant’s fees and

brokerage, consultation, underwriting and other fees and expenses actually

incurred in connection with such issuance or sale and net of taxes paid or

payable as a result thereof.

 

“Non-payment Default” means any event (other than a Payment

Default) the occurrence of which entitles one or more Persons to accelerate the

maturity of any Designated Senior Indebtedness.

 

“Officers’ Certificate” means a certificate signed by the

Chairman of the Board, Vice Chairman, the President or a Vice President

(regardless of vice presidential designation), and by the Treasurer, an

Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company or

any Guarantor, as the case may be, and delivered to the Trustee.

 

“Operating Cash Flow” means, for any period, the Consolidated

Net Income (Loss) of the Company and its Restricted Subsidiaries for such

period, plus (a) extraordinary net losses and net losses on sales of

assets outside the ordinary course of business during such period, to the

extent such losses were deducted in computing Consolidated Net Income (Loss),

plus (b) provision for taxes based on income or profits, to the extent

such provision for taxes was included in computing such Consolidated Net Income

(Loss), and any provision for taxes utilized in computing the net losses under

clause (a) hereof, plus (c) Consolidated Interest Expense of the Company

and its Restricted Subsidiaries for such period, plus (d) depreciation,

amortization and all other non-cash charges, to the extent such depreciation,

amortization and other non-cash charges were deducted in computing such

Consolidated Net Income (Loss) (including amortization of goodwill and other

intangibles, including Film Contracts and write-downs of Film Contracts), minus

(e) any cash payments contractually required to be made with respect to

Film Contracts (to the extent not previously included in computing such

Consolidated Net Income (Loss)).

 

“Opinion of Counsel” means a written opinion of counsel, who

may be counsel for the Company, any of the Guarantors or the Trustee, unless an

Opinion of Independent Counsel is required pursuant to the terms of this

Indenture, and who shall be acceptable to the Trustee.

 

15

 

“Opinion of Independent

Counsel” means a written opinion of counsel issued by someone

who is not an employee or consultant of the Company or any Guarantor and who

shall be acceptable to the Trustee.

 

“Outstanding” when used with respect to Securities

means, as of the date of determination, all Securities theretofore

authenticated and delivered under this Indenture, except:

 

(a)           Securities

theretofore cancelled by the Trustee or delivered to the Trustee for

cancellation;

 

(b)           Securities, or

portions thereof, for whose payment or redemption money in the necessary amount

has been theretofore deposited with the Trustee or any Paying Agent (other than

the Company or any Affiliate thereof) in trust or set aside and segregated in

trust by the Company or such Affiliate (if the Company or such Affiliate shall

act as the Paying Agent) for the Holders; provided that if such

Securities are to be redeemed, notice of such redemption has been duly given

pursuant to this Indenture or provision therefor reasonably satisfactory to the

Trustee has been made;

 

(c)           Securities, except

to the extent provided in Sections 402 and 403, with respect to which the

Company has effected defeasance or covenant defeasance as provided in Article

Four; and

 

(d)           Securities in

exchange for or in lieu of which other Securities have been authenticated and

delivered pursuant to this Indenture, other than any such Securities in respect

of which there shall have been presented to the Trustee proof reasonably

satisfactory to it that such Securities are held by a bona fide purchaser in

whose hands the Securities are valid obligations of the Company; provided,

however, that in determining whether the Holders of the requisite

principal amount of Outstanding Securities have given any request, demand,

authorization, direction, notice, consent or waiver hereunder, Securities owned

by the Company, any Guarantor, or any other obligor upon the Securities or any

Affiliate of the Company, any Guarantor, 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 knows to be so owned shall be so disregarded.  Securities so owned which have been pledged

in good faith may be regarded as Outstanding if the pledgee establishes to the

reasonable satisfaction of the Trustee the pledgee’s right so to act with

respect to such Securities and that the pledgee is not the Company, any

Guarantor or any other obligor upon the Securities or any Affiliate of the

Company, any Guarantor or such other obligor.

 

16

 

“Pari Passu

Indebtedness” means any Indebtedness of the Company or any

Guarantor that is pari  passu in right of payment to the

Securities or any Guarantee, as the case may be.

 

“Paying Agent” means any Person authorized by the

Company to pay the principal of, premium, if any, or interest on any Securities

on behalf of the Company.

 

“Payment Default” means any default in the payment of

principal of, premium, if any, or interest, on any Designated Senior

Indebtedness.

 

“Permitted

Guarantor Junior Securities” means (so long as the effect of any

exclusion employing this definition is not to cause the Guarantee to be treated

in any case or proceeding or similar event described in clause (a), (b) or (c)

of Section 1417 as part of the same class of claims as the Guarantor Senior

Indebtedness or any class of claims pari  passu with, or senior to,

the Guarantor Senior Indebtedness) for any payment or distribution, debt or

equity securities of any Guarantor or any successor corporation provided for by

a plan of reorganization or readjustment that are subordinated at least to the

same extent that the Guarantee is subordinated to the payment of all Guarantor

Senior Indebtedness then outstanding; provided that (1) if a new

corporation results from such reorganization or readjustment, such corporation

assumes any Guarantor Senior Indebtedness not paid in full in cash or Cash

Equivalents in connection with such reorganization or readjustment and (2) the

rights of the holders of such Guarantor Senior Indebtedness are not, without

the consent of such holders, altered by such reorganization or readjustment.

 

“Permitted Holders” means as of the date of determination

(i) any of David D. Smith, Frederick G. Smith, J. Duncan Smith and Robert

E. Smith; (ii) family members or the relatives of the Persons described in

clause (i); (iii) any trusts created for the benefit of the Persons

described in clause (i), (ii) or (iv) or any trust for the benefit of any such

trust; or (iv) in the event of the incompetence or death of any of the

Persons described in clauses (i) and (ii), such Person’s estate, executor, administrator,

committee or other personal representative or beneficiaries, in each case who

at any particular date shall beneficially own or have the right to acquire,

directly or indirectly, Equity Interests of the Company.

 

“Permitted

Indebtedness” has the meaning specified in Section 1008.

 

“Permitted Investment” means (i) Investments in any Wholly

Owned Restricted Subsidiary; (ii) Indebtedness of the Company or a

Restricted Subsidiary described under clauses (vi) and (vii) of the definition

of “Permitted Indebtedness”; (iii) Temporary Cash Investments;

(iv) Investments acquired by the Company or any Restricted Subsidiary in

connection with an Asset Sale permitted under Section 1013 to the extent such

Investments are non-cash proceeds as permitted under such covenant;

 

17

 

(v) guarantees of Indebtedness otherwise permitted by this

Indenture; (vi) Investments in existence on the date of this Indenture;

(vii) loans up to an aggregate of $1,000,000 outstanding at any time to

employees pursuant to benefits available to the employees of the Company or any

Restricted Subsidiary from time to time in the ordinary course of business;

(viii) any Investments in the Securities; (ix) a Guarantee by any

Guarantor and any other guarantee given by a Guarantor of any Indebtedness of

the Company in accordance with this Indenture; (x) Investments by the

Company or any Restricted Subsidiary in a Person, if as a result of such

Investment (I) such Person becomes a Restricted Subsidiary or (II) such

Person is merged, consolidated with or into, or transfers or conveys

substantially all of its assets to, or is liquidated into, the Company or a

Restricted Subsidiary; and (xi) other Investments that do not exceed

$5,000,000 at any time outstanding.

 

“Permitted Junior

Securities” means (so long as the effect of any exclusion

employing this definition is not to cause the Securities to be treated in any

case or proceeding or similar event described in clause (a), (b) or (c) of

Section 1202 as part of the same class of claims as the Senior Indebtedness or

any class of claims pari  passu with, or senior to, the Senior

Indebtedness) for any payment or distribution, debt or equity securities of the

Company or any successor corporation provided for by a plan of reorganization

or readjustment that are subordinated at least to the same extent that the

Securities are subordinated to the payment of all Senior Indebtedness then

outstanding; provided that (1) if a new corporation results from such

reorganization or readjustment, such corporation assumes any Senior

Indebtedness not paid in full in cash or Cash Equivalents in connection with

such reorganization or readjustment and (2) the rights of the holders of such

Senior Indebtedness are not, without the consent of such holders, altered by

such reorganization or readjustment.

 

“Permitted

Subsidiary Indebtedness” means:

 

(i)            Indebtedness of any

Guarantor under Capital Lease Obligations incurred in the ordinary course of

business; and

 

(ii)           Indebtedness of any

Guarantor (a) issued to finance or refinance the purchase or construction of

any assets of such Guarantor or (b) secured by a Lien on any assets of such

Guarantor where the lender’s sole recourse is to the assets so encumbered, in

either case (x) to the extent the purchase or construction prices for such

assets are or should be included in “property and equipment” in accordance with

GAAP and (y) if the purchase or construction of such assets is not part of any

acquisition of a Person or business unit.

 

“Person” means any individual, corporation,

limited liability company, partnership, joint venture, association, joint-stock

company, trust, unincorporated organization or government or any agency or

political subdivisions thereof.

 

18

 

“Predecessor Security” of any particular Security means every

previous Security evidencing all or a portion of the same debt as that

evidenced by such particular Security; and, for the purposes of this

definition, any Security authenticated and delivered under Section 308 in

exchange for a mutilated Security or in lieu of a lost, destroyed or stolen

Security shall be deemed to evidence the same debt as the mutilated, lost,

destroyed or stolen Security.

 

“Preferred Equity

Interest”, as applied to the Equity Interest of any Person,

means an Equity Interest of any class or classes (however designated) which is

preferred as to the payment of dividends or distributions, or as to the

distribution of assets upon any voluntary or involuntary liquidation or

dissolution of such person, over Equity Interests of any other class of such

Person.

 

“Prospectus” means the prospectus included in a

Registration Statement, including any preliminary prospectus, and any such

prospectus as amended or supplemented by any prospectus supplement, including

any such prospectus supplement with respect to the terms of the offering of any

portion of the Series A Securities covered by a Shelf Registration Statement,

and by all other amendments and supplements to such prospectus, including

post-effective amendments, and in each case including all material incorporated

by reference therein.

 

“Public Equity

Offering” means, with respect to any Person, an underwritten

public offering by such Person of some or all of its Equity Interests (other

than Disqualified Equity Interests), the net proceeds of which (after deducting

any underwriting discounts and commissions) exceed $10,000,000.

 

“Qualified Equity

Interests” of any Person means any and all Equity Interests of

such Person other than Disqualified Equity Interests.

 

“Redemption Date” when used with respect to any Security

to be redeemed pursuant to any provision in this Indenture means the date fixed

for such redemption by or pursuant to this Indenture.

 

“Redemption Price” when used with respect to any Security

to be redeemed pursuant to any provision in this Indenture means the price at

which it is to be redeemed pursuant to this Indenture.

 

“Registration

Rights Agreement” means the Registration Rights Agreement,

dated as of March 14, 2002, among the Company, the Guarantors and the Initial

Purchasers.

 

“Registration

Statement” means any registration statement of the Company which

covers any of the Series A Securities or Series B Securities pursuant to

the 

 

19

 

provisions of the Registration Rights Agreement, and all amendments and

supplements to any such Registration Statement, including post-effective

amendments, in each case including the Prospectus contained therein, all exhibits

thereto and all material incorporated by reference therein.

 

“Regular Record Date” for the interest payable on any Interest

Payment Date means the 15th day (whether or not a Business Day) next preceding

such Interest Payment Date.

 

“Regulation S”

means Regulation S under the Securities Act.

 

“Regulation S Global Securities”

means one or more permanent Global Securities in registered form representing

the aggregate principal amount of Securities sold in reliance on

Regulation S under the Securities Act.

 

“Responsible Officer” when used with respect to the Trustee

means any officer assigned to the Corporate Trust Office or the agent of the

Trustee appointed hereunder, including any vice president, assistant vice

president, assistant secretary, or any other officer or assistant officer of

the Trustee or the agent of the Trustee appointed hereunder to whom any

corporate trust matter is referred because of his or her knowledge of and

familiarity with the particular subject.

 

“Restricted Payment” has the meaning specified in Section

1009.

 

“Restricted

Securities Legend” means a legend substantially in the form of the

legend required in the form of Security set forth in Section 202 to be placed

upon a Restricted Security.

 

“Restricted

Securities Transfer Certificate” means a certificate substantially in the

form set forth in Exhibit A.

 

“Restricted Security” means each Security required pursuant to

Section 306 to bear a Restricted Securities Legend.

 

“Restricted

Subsidiary” means a Subsidiary of the Company other than an

Unrestricted Subsidiary.

 

“Rule 144A”

means Rule 144A under the Securities Act.

 

“Rule 144A Global Securities”

means one or more permanent Global Securities in registered form representing

the aggregate principal amount of Securities sold in reliance on Rule 144A

under the Securities Act.

 

20

 

“Rule 144A Information”  shall

be such information with respect to the Company and the Guarantors as is

specified pursuant to Rule 144A(d)(4) under the Securities Act (or any

successor provision thereto).

 

“Sale and

Leaseback Transaction” means any transaction or series of related

transactions pursuant to which the Company or a Restricted Subsidiary sells or

transfers any property or asset in connection with the leasing, or the resale

against installment payments, of such property or asset to the seller or

transferor.

 

“S&P” means Standard & Poor’s Ratings

Group, a division of the McGraw Hill Companies, or any successor rating agency.

 

“Securities” has the meaning specified in the

Recitals.

 

“Securities Act” means the Securities Act of 1933, as

amended.

 

“Security Register”

and “Security Registrar” have the respective meanings specified in Section

306.

 

“Senior Indebtedness” is defined as the principal of, premium,

if any, and interest (including interest accruing after the filing of a

petition initiating any proceeding under any state, federal or foreign

bankruptcy law whether or not allowable as a claim in such proceeding) on any

Indebtedness of the Company (other than as otherwise provided in this

definition), whether outstanding on the date of this Indenture or thereafter

created, incurred or assumed, and whether at any time owing, actually or

contingent, unless, in the case of any particular Indebtedness, the instrument

creating or evidencing the same or pursuant to which the same is outstanding

expressly provides that such Indebtedness shall not be senior in right of

payment to the Securities.  Without

limiting the generality of the foregoing, “Senior Indebtedness” shall include

(i) the principal of, premium, if any, and interest (including interest

accruing after the filing of a petition initiating any proceeding under any

state, federal or foreign bankruptcy law whether or not allowable as a claim in

such proceeding) and all other obligations of every nature of the Company from

time to time owed to the lenders (or their agent) under the Bank Credit

Agreement; provided, however, that any Indebtedness under any

refinancing, refunding or replacement of the Bank Credit Agreement shall not

constitute Senior Indebtedness to the extent that the Indebtedness thereunder

is by its express terms subordinate to any other Indebtedness of the Company,

(ii) Indebtedness outstanding under the Founders’ Notes and (iii) Indebtedness

under Interest Rate Agreements. 

Notwithstanding the foregoing, “Senior Indebtedness” shall not include

(i) Indebtedness evidenced by the Securities, (ii) Indebtedness that

is subordinate or junior in right of payment to any Indebtedness of the Company,

(iii) Indebtedness which when incurred and without respect to any election

under Section 1111(b) of Title 11 of the United States Code, is without

recourse to the Company, (iv) Indebtedness which is represented by

Disqualified Equity Interests, (v) any 

 

21

 

liability for foreign, federal, state, local or other taxes owed or

owing by the Company to the extent such liability constitutes Indebtedness,

(vi) Indebtedness of the Company to a Subsidiary or any other Affiliate of the

Company or any of such Affiliate’s subsidiaries, (vii) that portion of any

Indebtedness which at the time of issuance is issued in violation of this

Indenture, and (viii) Indebtedness owed by the Company for compensation to

employees or for services.

 

“Series A Securities” has the meaning specified in the

Recitals.

 

“Series B Securities” has the meaning specified in the

Recitals.

 

“Shelf

Registration Statement” means a “shelf” registration statement of the Company

pursuant to Section 2(b) of the Registration Rights Agreement, which

covers all or a portion of the Registrable Securities (as defined in the

Registration Rights Agreement) on an appropriate form under Rule 415 under the

Securities Act, or any similar rule that may be adopted by the Commission, and

all amendments and supplements to such registration statement, including

post-effective amendments, in each case including the Prospectus contained

therein, all exhibits thereto and all material incorporated by reference

therein.

 

“Special Record Date” for the payment of any Defaulted

Interest means a date fixed by the Trustee pursuant to Section 309.

 

“Stated Maturity” when used with respect to any

Indebtedness or any installment of interest thereon, means the date specified

in such Indebtedness as the fixed date on which the principal of such

Indebtedness or such installment of interest is due and payable.

 

“Subordinated

Indebtedness” means Indebtedness of the Company or any Guarantor

subordinated in right of payment to the Securities or a Guarantee, as the case

may be.

 

“Subsidiary” means any Person a majority of the

equity ownership or the Voting Stock of which is at the time owned, directly or

indirectly, by the Company or by one or more other Subsidiaries, or by the

Company and one or more other Subsidiaries.

 

“Successor Security” of any particular Security means every

Security issued after, and evidencing all or a portion of the same debt as that

evidenced by, such particular Security. 

For the purposes of this definition, any Security authenticated and

delivered under Section 308 in exchange for or in lieu of a mutilated,

destroyed, lost or stolen Security shall be deemed to evidence the same debt as

the mutilated, destroyed, lost or stolen Security.

 

22

 

“Temporary Cash

Investments” means (i) any evidence of Indebtedness, maturing

not more than one year after the date of acquisition, issued by the United

States of America, or an instrumentality or agency thereof and guaranteed fully

as to principal, premium, if any, and interest by the United States of America,

(ii) any certificate of deposit, maturing not more than one year after the

date of acquisition, issued by, or time deposit of, a commercial banking

institution (including the Trustee) that is a member of the Federal Reserve

System and that has combined capital and surplus and undivided profits of not

less than $500,000,000, whose debt has a rating, at the time as of which any

investment therein is made, of “P-1” (or higher) according to Moody’s or “A-1”

(or higher) according to S&P, (iii) commercial paper, maturing not

more than one year after the date of acquisition, issued by a corporation

(other than an Affiliate or Subsidiary of the Company) (including the Trustee)

organized and existing under the laws of the United States of America with a

rating, at the time as of which any investment therein is made, of “P-1” (or

higher) according to Moody’s or “A-1” (or higher) according to S&P and

(iv) any money market deposit accounts issued or offered by a domestic

commercial bank (including the Trustee) having capital and surplus in excess of

$500,000,000.

 

“Trust Indenture Act” means the Trust Indenture Act of 1939,

as amended.

 

“Trustee” means the Person named as the “Trustee”

in the first paragraph of this instrument, until a successor Trustee shall have

become such pursuant to the applicable provisions of this Indenture, and

thereafter “Trustee” shall mean such successor Trustee.

 

“Unrestricted

Subsidiary” means (i) any Subsidiary of the Company that at

the time of determination shall be an Unrestricted Subsidiary (as designated by

the Board of Directors of the Company, as provided below) and (ii) any

Subsidiary of an Unrestricted Subsidiary. 

The Board of Directors of the Company may designate any Subsidiary of

the Company (including any newly acquired or newly formed Subsidiary) to be an

Unrestricted Subsidiary if all of the following conditions apply:  (a) such Subsidiary is not liable,

directly or indirectly, with respect to any Indebtedness other than

Unrestricted Subsidiary Indebtedness and (b) any Investment in such

Subsidiary made as a result of designating such Subsidiary an Unrestricted

Subsidiary shall not violate the provisions of Section 1019.  Any such designation by the Board of

Directors of the Company shall be evidenced to the Trustee by filing with the

Trustee a Board Resolution giving effect to such designation and an Officers’

Certificate certifying that such designation complies with the foregoing

conditions.  The Board of Directors of

the Company may designate any Unrestricted Subsidiary as a Restricted

Subsidiary; provided that immediately after giving effect to such

designation, the Company could incur $1.00 of additional Indebtedness (other

than Permitted Indebtedness) pursuant to the restrictions under Section

1008.  Cascom International, Inc.,

Sinclair Communications of Portland, Inc., Sinclair Media IV, Inc., Sinclair

Media V, Inc., Sinclair Radio of Buffalo Licensee, LLC, 

 

23

 

Sinclair Radio of Buffalo, Inc., Sinclair Radio of Greenville Licensee,

Inc., Sinclair Radio of Kansas City Licensee, LLC, Sinclair Radio of Los

Angeles, Inc., Sinclair Radio of Los Angeles Licensee, Inc., Sinclair Radio of

Memphis, Inc., Sinclair Radio of Memphis Licensee, Inc., Sinclair Radio of

Milwaukee Licensee, LLC, Sinclair Radio of Nashville, Inc., Sinclair Radio of

Nashville Licensee, Inc., Sinclair Radio of New Orleans, LLC, Sinclair Radio of

New Orleans Licensee, LLC, Sinclair Radio of Norfolk/Greensboro Licensee L.P.,

Sinclair Radio of Norfolk Licensee, LLC, Sinclair Radio of Portland Licensee,

Inc., Sinclair Radio of Rochester Licensee, Inc., Sinclair Radio of St. Louis

Licensee, LLC, Sinclair Radio of St. Louis, Inc., Sinclair Radio of

Wilkes-Barre Licensee, LLC, Sinclair Radio of Wilkes-Barre, Inc., Sinclair

Television of Utica, Inc., Tuscaloosa Broadcasting, Inc., Tuscaloosa

Broadcasting Licensee, Inc., WNNE Licensee, Inc., WPTZ Licensee, Inc., Acrodyne

Communications, Inc., Sincaro, Ltd., KDSM, Inc., KDSM Licensee, LLC, Sinclair

Capital, G1440, Inc., Sinclair Ventures, Inc. and Cresap Enterprises, Inc. are

Unrestricted Subsidiaries.

 

“Unrestricted

Subsidiary Indebtedness” of any Unrestricted Subsidiary means Indebtedness of

such Unrestricted Subsidiary (i) as to which neither the Company nor any

Restricted Subsidiary is directly or indirectly liable (by virtue of the

Company or any such Restricted Subsidiary being the primary obligor on,

guarantor of, or otherwise liable in any respect to, such Indebtedness), except

Guaranteed Debt of the Company or any Restricted Subsidiary to any Affiliate,

in which case (unless the incurrence of such Guaranteed Debt resulted in a

Restricted Payment at the time of incurrence) the Company shall be deemed to

have made a Restricted Payment equal to the principal amount of any such

Indebtedness to the extent guaranteed at the time such Affiliate is designated

an Unrestricted Subsidiary and (ii) which, upon the occurrence of a

default with respect thereto, does not result in, or permit any holder of any

Indebtedness of the Company or any Restricted Subsidiary to declare, a default

on such Indebtedness of the Company or any Restricted Subsidiary or cause the

payment thereof to be accelerated or payable prior to its Stated Maturity.

 

“U.S. Person” means a citizen or resident of the

United States, a corporation, partnership or other entity created or organized

in or under the laws of the United States or any political subdivision thereof,

or an estate or trust, the income of which is subject to United States federal

income taxation regardless of its source.

 

“Voting Stock” means stock of the class or classes

pursuant to which the holders thereof have the general voting power under

ordinary circumstances to elect at least a majority of the board of directors,

managers or trustees of a corporation (irrespective of whether or not at the

time stock of any other class or classes shall have or might have voting power

by reason of the happening of any contingency).

 

“Wholly Owned

Restricted Subsidiary” means a Restricted Subsidiary all the Equity Interest

of which is owned by the Company or another Wholly Owned Restricted 

 

24

 

Subsidiary.  The Wholly Owned

Restricted Subsidiaries of the Company currently consist of all of the

Company’s Restricted Subsidiaries.

 

Section 102.  Other Definitions.

 

	

  Term

  	

   

  	

  Defined in 

  Section

  
	

  “Act”

  	

   

  	

           105

  
	

  “Additional Securities”

  	

   

  	

           301

  
	

  “Agent Members”

  	

   

  	

           305

  
	

  “Change of Control Offer”

  	

   

  	

         1016

  
	

  “Change of Control Purchase Date”

  	

   

  	

         1016

  
	

  “Change of Control Purchase Notice”

  	

   

  	

         1016

  
	

  “Change of Control Purchase Price”

  	

   

  	

         1016

  
	

  “covenant defeasance”

  	

   

  	

           403

  
	

  “Defaulted Interest”

  	

   

  	

           309

  
	

  “defeasance”

  	

   

  	

           402

  
	

  “Defeasance Redemption Date”

  	

   

  	

           404

  
	

  “Defeased Securities”

  	

   

  	

           401

  
	

  “Deficiency”

  	

   

  	

         1013

  
	

  “Excess Proceeds”

  	

   

  	

         1013

  
	

  “Guarantor Senior Representative”

  	

   

  	

         1424

  
	

  “Global Security”

  	

   

  	

           202

  
	

  “HYTOPS”

  	

   

  	

           101

  
	

  “Initial Blockage Period”

  	

   

  	

         1203

  
	

  “Offer”

  	

   

  	

         1013

  
	

  “Offer Date”

  	

   

  	

         1013

  
	

  “Offered Price”

  	

   

  	

         1013

  
	

  “Pari Passu Debt Amount”

  	

   

  	

         1013

  
	

  “Pari Passu Offer”

  	

   

  	

         1013

  
	

  “Payment Blockage Period”

  	

   

  	

         1203

  
	

  “Penalty Interest”

  	

   

  	

           202

  
	

  “Permitted Guarantor Junior Securities”

  	

   

  	

         1417

  
	

  “Permitted Indebtedness”

  	

   

  	

         1008

  
	

  “Permitted Payments”

  	

   

  	

         1009

  
	

  “Physical Securities”

  	

   

  	

           305

  
	

  “Prescribed Time Period”

  	

   

  	

           202

  
	

  “QIB”

  	

   

  	

           203

  
	

  “Required Filing Dates”

  	

   

  	

         1020

  
	

  “Restricted Period”

  	

   

  	

           201

  
	

  “Security Amount”

  	

   

  	

         1013

  
	

  “Senior Representative”

  	

   

  	

         1203

  
	

  “Surviving Entity”

  	

   

  	

           801

  
	

  “U.S. Government Obligations”

  	

   

  	

           404

  
				

 

25

 

Section

103.  Compliance Certificates and Opinions.

 

Upon any application or request by the Company to the Trustee to take

any action under any provision of this Indenture, the Company, any Guarantor

and any other obligor on the Securities shall furnish to the Trustee an

Officers’ Certificate stating that all conditions precedent, if any, provided

for in this Indenture (including any covenants compliance with which

constitutes a condition precedent) relating to the proposed action have been

complied with and an Opinion of Counsel stating that in the opinion of such

counsel all such conditions precedent, if any, have been complied with, except

that, in the case of any such application or request as to which the furnishing

of such documents, certificates and/or opinions is specifically required by any

provision of this Indenture relating to such particular application or request,

no additional certificate or opinion need be furnished.

 

Every certificate or Opinion of Counsel with respect to compliance with

a condition or covenant provided for in this Indenture shall include:

 

(a)           a statement that

each individual signing such certificate or opinion has read such covenant or

condition and the definitions herein relating thereto;

 

(b)           a brief statement as

to the nature and scope of the examination or investigation upon which the

statements or opinions contained in such certificate or opinion are based;

 

(c)           a statement that, in

the opinion of each such individual, he has made such examination or investigation

as is necessary to enable him to express an informed opinion as to whether or

not such covenant or condition has been complied with; and

 

(d)           a statement as to

whether, in the opinion of each such individual, such condition or covenant has

been complied with.

 

Section 104.  Form of Documents Delivered to Trustee.

 

In any case where several matters are required to be certified by, or

covered by an opinion of, any specified Person, it is not necessary that all

such matters be certified by, or covered by the opinion of, only one such

Person, or that they be so certified or covered by only one document, but one

such Person may certify or give an opinion with respect to some matters and one

or more other such Persons as to other matters, and any such Person may certify

or give an opinion as to such matters in one or several documents.

 

26

 

Any certificate or opinion of an officer of the Company, any Guarantor

or other obligor of the Securities may be based, insofar as it relates to legal

matters, upon a certificate or opinion of, or representations by, counsel,

unless such officer knows that the certificate or opinion or representations

with respect to the matters upon which his certificate or opinion is based are

erroneous.  Any such certificate or

opinion may be based, insofar as it relates to factual matters, upon a

certificate or opinion of, or representations by, an officer or officers of the

Company, any Guarantor or other obligor of the Securities stating that the

information with respect to such factual matters is in the possession of the

Company, any Guarantor or other obligor of the Securities, unless such counsel

knows that the certificate or opinion or representations with respect to such

matters are erroneous.  Opinions of

Counsel required to be delivered to the Trustee may have qualifications

customary for opinions of the type required and counsel delivering such

Opinions of Counsel may rely on certificates of the Company or government or

other officials customary for opinions of the type required, including

certificates certifying as to matters of fact, including that various financial

covenants have been complied with.

 

Where any Person is required to make, give or execute two or more

applications, requests, consents, certificates, statements, opinions or other

instruments under this Indenture, they may, but need not, be consolidated and

form one instrument.

 

Section 105.  Acts of Holders.

 

(a)           Any request, demand,

authorization, direction, notice, consent, waiver or other action provided by

this Indenture to be given or taken by Holders may be embodied in and evidenced

by one or more instruments of substantially similar tenor signed by such

Holders in person or by an agent duly appointed in writing; and, except as

herein otherwise expressly provided, such action shall become effective when

such instrument or instruments are delivered to the Trustee and, where it is

hereby expressly required, to the Company. 

Such instrument or instruments (and the action embodied therein and

evidenced thereby) are herein sometimes referred to as the “Act” of the Holders

signing such instrument or instruments. 

Proof of execution of any such instrument or of a writing appointing any

such agent shall be sufficient for any purpose of this Indenture, if made in

the manner provided in this Section. 

The fact and date of the execution by any person of any such instrument

or writing or the authority of the person executing the same, may also be

proved in any other manner which the Trustee deems sufficient in accordance

with such reasonable rules as the Trustee may determine.

 

(b)           The ownership of

Securities shall be proved by the Security Register.

 

(c)           Any request, demand,

authorization, direction, notice, consent, waiver or other action by the Holder

of any Security shall bind every future Holder of the same Security or the

Holder of every Security issued upon the transfer thereof or in 

 

27

 

exchange therefor or in lieu thereof, in respect of anything done,

suffered or omitted to be done by the Trustee, any Paying Agent or the Company

or any Guarantor in reliance thereon, whether or not notation of such action is

made upon such Security.

 

(d)           If the Company shall

solicit from the Holders any request, demand, authorization, direction, notice,

consent, waiver or other Act, the Company may, at its option, by or pursuant to

a Board Resolution, fix in advance a record date for the determination of such

Holders entitled to give such request, demand, authorization, direction,

notice, consent, waiver or other Act, but the Company shall have no obligation

to do so.  Notwithstanding Trust

Indenture Act Section 316(c), any such record date shall be the record date

specified in or pursuant to such Board Resolution, which shall be a date not

more than 30 days prior to the first solicitation of Holders generally in

connection therewith and no later than the date such solicitation is completed.

 

In the absence of any such record date fixed by the Company, regardless

as to whether a solicitation of the Holders is occurring on behalf of the

Company or any Holder, the Trustee may, at its option, fix in advance a record

date for the determination of such Holders entitled to give such request, demand,

authorization, direction, notice, consent, waiver or other Act, but the Trustee

shall have no obligation to do so.  Any

such record date shall be a date not more than 30 days prior to the first

solicitation of Holders generally in connection therewith and no later than a

date such solicitation is completed.

 

If such a record date is fixed, such request, demand, authorization,

direction, notice, consent, waiver or other Act may be given before or after

such record date, but only the Holders of record at the close of business on

such record date shall be deemed to be Holders for purposes of determining

whether Holders of the requisite proportion of Securities then Outstanding have

authorized or agreed or consented to such request, demand, authorization,

direction, notice, consent, waiver or other Act, and for this purpose the

Securities then Outstanding shall be computed as of such record date; provided

that no such request, demand, authorization, direction, notice, consent, waiver

or other Act by the Holders on such record date shall be deemed effective

unless it shall become effective pursuant to the provisions of this Indenture

not later than six months after the record date.

 

Section 106.  Notices, etc., to Trustee, the Company

and any Guarantor.

 

Any request, demand, authorization, direction, notice, consent, waiver

or Act of Holders or other document provided or permitted by this Indenture to

be made upon, given or furnished to, or filed with:

 

(a)           the Trustee by any

Holder or by the Company or any Guarantor or any other obligor of the

Securities or a Senior Representative or holder of Senior Indebtedness shall be

sufficient for every purpose hereunder if in writing and mailed, 

 

28

 

first-class postage prepaid, or delivered by recognized overnight

courier, to or with the Trustee at the Corporate Trust Office, Attention:  Corporate Trust Division, or at any other

address previously furnished in writing to the Holders, the Company, any

Guarantor, any other obligor of the Securities or a Senior Representative or

holder of Senior Indebtedness by the Trustee; or

 

(b)           the Company or any

Guarantor shall be sufficient for every purpose (except as provided in Section

501(c)) hereunder if in writing and mailed, first-class postage prepaid, or

delivered by recognized overnight courier, to the Company or such Guarantor

addressed to it at Sinclair Broadcast Group, Inc., 10706 Beaver Dam Road, Hunt

Valley, Maryland  21030, Attention:  President, or at any other address

previously furnished in writing to the Trustee by the Company;

 

Section 107.  Notice to Holders; Waiver.

 

Where this Indenture provides for notice to Holders of any event, such

notice shall be sufficiently given (unless otherwise herein expressly provided)

if in writing and mailed, first-class postage prepaid, or delivered by

recognized overnight courier, to each Holder affected by such event, at his

address as it appears in the Security Register, not later than the latest date,

and not earlier than the earliest date, prescribed for the giving of such

notice.  In any case where notice to

Holders is given by mail, neither the failure to mail such notice, nor any

defect in any notice so mailed, to any particular Holder shall affect the

sufficiency of such notice with respect to other Holders.  Any notice when mailed to a Holder in the

aforesaid manner shall be conclusively deemed to have been received by such

Holder whether or not actually received by such Holder.  Where this Indenture provides for notice in any

manner, such notice may be waived in writing by the Person entitled to receive

such notice, either before or after the event, and such waiver shall be the

equivalent of such notice.  Waivers of

notice by Holders shall be filed with the Trustee, but such filing shall not be

a condition precedent to the validity of any action taken in reliance upon such

waiver.

 

In case by reason of the suspension of regular mail service or by

reason of any other cause, it shall be impracticable to mail notice of any event

as required by any provision of this Indenture, then any method of giving such

notice as shall be reasonably satisfactory to the Trustee shall be deemed to be

a sufficient giving of such notice.

 

Section 108.  Conflict with Trust Indenture Act.

 

If any provision hereof limits, qualifies or conflicts with any

provision of the Trust Indenture Act or another provision which is required or

deemed to be included in this Indenture by any of the provisions of the Trust

Indenture Act, the provision or requirement of the Trust Indenture Act shall

control.  If any provision of this

Indenture modifies or excludes any provision of the Trust Indenture Act that

may be so modified or 

 

29

 

excluded, the latter provision shall be deemed to apply to this

Indenture as so modified or to be excluded, as the case may be.

 

Section 109.  Effect of Headings and Table of Contents.

 

The Article and Section headings herein and the Table of Contents are

for convenience only and shall not affect the construction hereof.

 

Section 110.  Successors and Assigns.

 

All covenants and

agreements in this Indenture by the Company and the Guarantors shall bind their

successors and assigns, whether so expressed or not.

 

Section 111.  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 112.  Benefits of Indenture.

 

Nothing in this Indenture or in the Securities or the Guarantees,

express or implied, shall give to any Person (other than the parties hereto and

their successors hereunder, any Paying Agent, the Holders and the holders of

Senior Indebtedness or Guarantor Senior Indebtedness) any benefit or any legal

or equitable right, remedy or claim under this Indenture.

 

Section 113.  Governing Law.

 

THIS

INDENTURE AND THE SECURITIES AND THE GUARANTEES SHALL BE GOVERNED BY, AND

CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING

EFFECT TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF).

 

Section 114.  Legal Holidays.

 

In any case where any Interest Payment Date, Redemption Date or Stated

Maturity of any Security shall not be a Business Day, then (notwithstanding any

other provision of this Indenture or of the Securities) payment of interest or

principal or premium, if any, need not be made on such date, but may be made on

the next succeeding Business Day with the same force and effect as if made on

the Interest Payment Date or Redemption Date, or at the Stated Maturity and no

interest shall accrue with respect to 

 

30

 

such payment for the period from and after such Interest Payment Date,

Redemption Date or Stated Maturity, as the case may be, to the next succeeding

Business Day.

 

Section 115.  Schedules and Exhibits.

 

All schedules and exhibits attached hereto are by this reference made a

part hereof with the same effect as if herein set forth in full.

 

Section 116.  Counterparts.

 

This Indenture may be executed in any number of counterparts, each of

which shall be an original; but such counterparts shall together constitute but

one and the same instrument.

 

ARTICLE TWO

 

SECURITY FORMS

 

Section 201.  Forms Generally.

 

The Securities and the Trustee’s certificate of authentication shall be

in substantially the forms set forth in this Article, with such appropriate

insertions, omissions, substitutions and other variations as are required or

permitted by this Indenture and may have such letters, numbers or other marks

of identification and such legends or endorsements placed thereon as may be

required to comply with the rules of any securities exchange, any

organizational document or governing instrument or applicable law or as may,

consistently herewith, be determined by the officers executing such Securities,

as evidenced by their execution of the Securities.  Any portion of the text of any Security may be set forth on the

reverse thereof, with an appropriate reference thereto on the face of the

Security.

 

The definitive Securities shall be printed, lithographed or engraved or

produced by any combination of these methods or may be produced in any other

manner permitted by the rules of any securities exchange on which the

Securities may be listed, all as determined by the officers executing such

Securities, as evidenced by their execution of such Securities.

 

Series A Securities offered and sold in reliance on Rule 144A

shall be issued initially in the form of one or more Rule 144A Global

Securities, substantially in the form set forth in Section 202, deposited

upon issuance with the Trustee, as custodian for the Depositary, registered in

the name of the Depositary or its nominee, in each case for credit to an

account of a direct or indirect participant of the Depositary, duly executed by

 

31

 

the Company and authenticated by the Trustee as hereinafter

provided.  The aggregate principal

amount of the Rule 144A Global Securities may from time to time be increased or

decreased by adjustments made on the records of the Trustee, as custodian for

the Depositary or its nominee, as hereinafter provided.

 

Series A Securities offered and sold in reliance on Regulation S

shall be issued in the form of one or more Regulation S Global Securities,

substantially in the form set forth in Section 202, deposited upon

issuance with the Trustee, as custodian for the Depositary, registered in the

name of the Depositary or its nominee, in each case for credit by the

Depositary to an account of a direct or indirect participant of the Depositary,

duly executed by the Company and authenticated by the Trustee as hereinafter

provided; provided,

however, that upon such deposit through and including the 40th day

after the later of the commencement of the offering of Securities and the

original issue date of the Securities (such period through and including such

40th day, the “Restricted Period”), all such Securities shall be credited to or

through accounts maintained at the Depositary by or on behalf of Euroclear or

Clearstream unless exchanged for interests in the Rule 144A Global

Securities in accordance with the transfer and certification requirements

described below.  The aggregate

principal amount of the Regulation S Global Securities may from time to time be

increased or decreased by adjustments made on the records of the Trustee, as

custodian for the Depositary or its nominee, as hereinafter provided.

 

Series B Securities exchanged for Series A Securities shall be issued

initially in the form of one or more Series B Global Securities, substantially

in the form set forth in Section 202, deposited upon issuance with the Trustee,

as custodian for the Depositary, registered in the name of the Depositary or

its nominee, in each case for credit to an account of a direct or indirect

participant of the Depositary, duly executed by the Company and authenticated

by the Trustee as hereinafter provided. 

The aggregate principal amount of the Series B Global Securities may

from time to time be increased or decreased by adjustments made on the records

of the Trustee, as custodian for the Depositary or its nominee, as hereinafter

provided.

 

The terms and provisions contained in the form of Securities set forth

in Sections 202 through 205 shall constitute, and are expressly made, a part of

this Indenture and, to the extent applicable, the Company, the Guarantors and

the Trustee, by their execution and delivery of this Indenture, expressly agree

to such terms and provisions and to be bound thereby.

 

32

 

Section 202.  Form of Face of Security.

 

(a)           The form of the face

of any Series A Security authenticated and delivered hereunder shall be substantially

as follows:

 

Unless and until (i) a Series A Security is sold under an effective

Registration Statement or (ii) a Series A Security is exchanged for a Series B

Security in connection with an effective Registration Statement, in each case

pursuant to the Registration Rights Agreement, then each Series A Security

shall bear the legend set forth below (the “Restricted Securities Legend”) on

the face thereof:

 

SINCLAIR BROADCAST GROUP, INC.

8% SENIOR

SUBORDINATED NOTE DUE 2012, SERIES A

 

[If the

Security is a Restricted Security, insert — THIS SECURITY HAS NOT

BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES

ACT”), OR ANY STATE SECURITIES LAWS. 

NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE

REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE

DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS

EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. 

THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER,

SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE

RESTRICTION TERMINATION DATE”) WHICH IS TWO YEARS AFTER THE LATER OF THE

ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY

AFFILIATED PERSON OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY

PREDECESSOR OF SUCH SECURITY) UNLESS SUCH OFFER, SALE OR OTHER TRANSFER IS (A)

TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN

DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES

ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON THE HOLDER

REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE

144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN  ACCOUNT OR FOR THE ACCOUNT

OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS

BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT

OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE

SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE

MEANING OF SUBPARAGRAPH (A)(1), (A)(2), (A)(3) OR (A)(7) OF RULE 501 UNDER THE

SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE

ACCOUNT OF SUCH AN INSTITUTIONAL “ACCREDITED INVESTOR,” FOR INVESTMENT PURPOSES

AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY

DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER

AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,

SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE

OR TRANSFER PURSUANT TO CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN

OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH

OF THEM, AND IN EACH OF THE FOREGOING CASES, A 

 

33

 

CERTIFICATE OF

TRANSFER IN THE FORM APPEARING ON THIS SECURITY IS COMPLETED AND DELIVERED BY

THE TRANSFEROR TO THE TRUSTEE.  THIS

LEGEND WILL BE REMOVED UPON THE REQUEST OF THE THEN HOLDER OF THIS SECURITY

AFTER THE RESALE RESTRICTION TERMINATION DATE.

 

No.

__________________________________                              $

 

SINCLAIR BROADCAST GROUP, INC., a Maryland corporation (herein called

the “Company,” which term includes any successor Person under the Indenture

hereinafter referred to), for value received, hereby promises to pay to

 ______  or registered assigns, the principal sum of

 ______  United States dollars ($ ________ ) on March 15, 2012, at

the office or agency of the Company referred to below, and to pay interest

thereon from March 14, 2002, or from the most recent Interest Payment Date to

which interest has been paid or duly provided for, semiannually on March 15 and

September 15 in each year, commencing September 15, 2002 at the rate of 8% per

annum, plus Penalty Interest, if any, in United States dollars, until the

principal hereof is paid or duly provided for.

 

The interest so payable, and punctually paid or duly provided for, on

any Interest Payment Date will, as provided in such Indenture, be paid to the

Person in whose name this Series A Security (or one or more Predecessor

Securities) is registered at the close of business on the Regular Record Date

for such interest, which shall be the September 1 or March 1 (whether or not a

Business Day), as the case may be, next preceding such Interest Payment

Date.  Any such interest not so

punctually paid, or duly provided for, and interest on such defaulted interest

at the interest rate borne by the Series A Securities, to the extent lawful,

shall forthwith cease to be payable to the Holder on such Regular Record Date,

and may be paid to the Person in whose name this Series A Security (or one or

more Predecessor Securities) is registered at the close of business on a

Special Record Date for the payment of such defaulted interest to be fixed by

the Trustee, notice whereof shall be given to Holders of Series A Securities

not less than 10 days prior to such Special Record Date, or may be paid at

any time in any other lawful manner not inconsistent with the requirements of

any securities exchange on which the Series A Securities may be listed, and

upon such notice as may be required by such exchange, all as more fully

provided in said Indenture.

 

The Holder of this Series A Security is entitled to the benefits of the

Registration Rights Agreement, dated as of March 14, 2002, among the Company,

the Guarantors and the Initial Purchasers, pursuant to which, subject to the

terms and conditions thereof, the Company is obligated, among other things, to

consummate the Exchange Offer pursuant to which the Holder of this Series A

Security shall have the right to exchange this Series A Security for 8% Senior

Subordinated Notes due 2012, Series B (herein called the “Series B Securities”)

in like principal amount as provided therein. 

The Series A Securities and the Series B Securities are together

referred to as the 

 

34

 

“Securities.”  The Series A

Securities rank pari  passu in right of payment with the Series B

Securities.

 

Additional interest (“Penalty Interest”) will be assessed on the Series

A Securities as follows:

 

(i) (A) if an Exchange Offer Registration Statement (or, in the event

of a change in applicable law or due to current interpretations by the

Commission, the Company is not permitted to effect the Exchange Offer, a Shelf

Registration Statement) is not filed within 60 days following the Closing Date,

(B) in the event that within 30 days after consummation of the Exchange

Offer, any Holder shall notify the Company that such Holder (x) is prohibited

by applicable law or Commission policy from participating in the Exchange

Offer, (y) may not resell Exchange Securities acquired by it in the

Exchange Offer to the public without delivering a prospectus and that the

prospectus contained in the Exchange Offer Registration Statement is not

appropriate or available for such resales by such Holder or (z) is a

broker-dealer and holds Series A Securities acquired directly from the Company

or an “affiliate” of the Company and a Shelf Registration Statement is not

filed within 60 days after such notice or (C) upon the request of an Initial

Purchaser, a Shelf Registration Statement is not filed within 60 days after

such request, then commencing on either the 61st day after the Closing Date or

the expiration of either of the 60-day time periods set forth in clauses (B) or

(C) above (either, a “Prescribed Time Period”), as the case may be, Penalty

Interest shall be accrued on the Series A Securities over and above the stated

payment rates thereon at a rate of .50% per annum for the first 90 days

immediately following either the 60th day after the Closing Date or the

expiration of the applicable Prescribed Time Period, as the case may be, such

Penalty Interest rate increasing by an additional .25% per annum at the

beginning of each subsequent 90-day period;

 

(ii) if an Exchange Offer Registration Statement or a Shelf

Registration Statement is filed pursuant to clause (i) of the preceding full

paragraph and is not declared effective within either 120 days following the

Closing Date or 60 days following the expiration of the applicable Prescribed

Time Period, as the case may be, then commencing on the 121st day after either

the Closing Date or the 61st day following the expiration of the

applicable Prescribed Time Period, as the case may be, Penalty Interest shall

be accrued on the Series A Securities over and above the accrued stated payment

rates thereon at a rate of .50% per annum for the first 90 days immediately following

the 121st day after either the Closing Date or the 61st day after

the expiration of the applicable Prescribed Time Period, as the case may be,

such Penalty Interest rate increasing by an additional .25% per annum at the

beginning of each subsequent 90-day period; and

 

(iii) if either (A) the Company has not exchanged the Exchange

Securities (as defined in the Registration Rights Agreement) for all of the

Series A Securities validly 

 

35

 

tendered in accordance with the terms of the Exchange Offer on or prior

to 150 days after the Closing Date, or (B) if applicable, a Shelf Registration

Statement has been declared effective and such Shelf Registration Statement

ceases to be effective prior to two years from its original effective date or

such shorter period that will terminate when all of the Series A Securities

covered by the Shelf Registration Statement have been sold pursuant to the

Shelf Registration Statement, then, subject to certain exceptions, Penalty

Interest shall be accrued on the Series A Securities over and above the stated

payment rates at a rate of .50% per annum for the first 90 days immediately

following the (x) 151st day after the Closing Date in the case of

(A) above or (y) the day such Shelf Registration Statement ceases to be

effective in the case of (B) above, such Penalty Interest rate increasing by an

additional .25% per annum at the beginning of each subsequent 90-day period;

 

provided, however, that the Penalty Interest rate on the

Series A Securities may not exceed 1.5% per annum; and provided, further,

that (1) upon the filing of the Exchange Offer Registration Statement or a

Shelf Registration Statement (in the case of (i) above), (2) upon the

effectiveness of the Exchange Offer Registration Statement or a Shelf

Registration Statement (in the case of (ii) above), or (3) upon the exchange of

Exchange Securities for all Series A Securities tendered in the Exchange Offer

or upon the effectiveness of the Shelf Registration Statement which had ceased

to remain effective prior to two years from its original effective date (in the

case of (iii) above), Penalty Interest as a result of such clause (i), (ii) or

(iii) shall cease to accrue.

 

Any Penalty Interest due pursuant to clause (i), (ii) or (iii) above

will be payable in cash on the Interest Payment Date related to the Series A

Securities.  The Penalty Interest will

be determined by multiplying the applicable Penalty Interest rate by the

principal amount of the Series A Securities, multiplied by a fraction the

numerator of which is the number of days such Penalty Interest rate was

applicable during such period, and the denominator of which is 360.

 

Payment of the principal of, premium, if any, and interest on this

Series A Security will be made at the office or agency of the Company

maintained for that purpose, in such coin or currency of the United States of

America as at the time of payment is legal tender for payment of public and

private debts; provided, however, that payment of interest may be

made at the option of the Company by check mailed to the address of the Person

entitled thereto as such address shall appear on the Security Register.  If any of the Series A Securities are held

by the Depositary, payments of interest to the Depositary may be made by wire

transfer to the Depositary.  Interest

shall be computed on the basis of a 360-day year of twelve 30-day months.

 

Reference is hereby made to the further provisions of this Series A

Security set forth on the reverse hereof, which further provisions shall for

all purposes have the same effect as if set forth at this place.

 

36

 

This Series A Security is entitled to the benefits of Guarantees by

each of the Guarantors of the punctual payment when due of the Indenture

Obligations made in favor of the Trustee for the benefit of the Holders.  Reference is hereby made to Article Fourteen

of the Indenture for a statement of the respective rights, limitations of

rights, duties and obligations under the Guarantees of each of the Guarantors.

 

All references in this Series A Security or in the Indenture to accrued

and unpaid interest shall be deemed to include, to the extent applicable, a

reference to Penalty Interest.

 

Unless the certificate of authentication hereon has been duly executed

by the Trustee referred to on the reverse hereof or by the authenticating agent

appointed as provided in the Indenture by manual signature, this Series A

Security shall not be entitled to any benefit under the Indenture, or be valid

or obligatory for any purpose.

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly

executed by the manual or facsimile signature of its authorized officers.

 

	

  Dated:

  	

  SINCLAIR BROADCAST GROUP, INC.

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  
	

  Attest:

  	

   

  
	

   

  	

   

  	

   

  
	

  Secretary

  	

   

  	

   

  

 

(b)           The form of the face

of any Series B Security authenticated and delivered hereunder shall be

substantially as follows:

 

SINCLAIR BROADCAST GROUP, INC.

8% SENIOR

SUBORDINATED NOTE DUE 2012, SERIES B

 

No.          ________________                                                                                                                                           $

____________

 

SINCLAIR BROADCAST GROUP, INC., a Maryland corporation (herein called

the “Company,” which term includes any successor Person under the Indenture 

 

37

 

hereinafter referred to), for value received, hereby promises to pay to

 ______  or registered assigns, the principal sum of

 ______  United States dollars ($ ________ ) on March 15, 2012, at

the office or agency of the Company referred to below, and to pay interest thereon

from March 14, 2002, or from the most recent Interest Payment Date to which

interest has been paid or duly provided for, semiannually on March 15 and

September 15 in each year, commencing September 15, 2002, at the rate of 8% per

annum, plus Penalty Interest, if any, in United States dollars, until the

principal hereof is paid or duly provided for; provided that to the extent

interest has not been paid or duly provided for with respect to the Series A

Security exchanged for this Series B Security, interest on this Series B

Security shall accrue from the most recent Interest Payment Date to which

interest on the Series A Security which was exchanged for this Series B

Security has been paid or duly provided for.

 

The interest so payable, and punctually paid or duly provided for, on

any Interest Payment Date will, as provided in such Indenture, be paid to the

Person in whose name this Series B Security (or one or more Predecessor

Securities) is registered at the close of business on the Regular Record Date

for such interest, which shall be the September 1 or March 1 (whether or not a

Business Day), as the case may be, next preceding such Interest Payment

Date.  Any such interest not so

punctually paid, or duly provided for, and interest on such defaulted interest

at the interest rate borne by the Series B Securities, to the extent lawful,

shall forthwith cease to be payable to the Holder on such Regular Record Date,

and may be paid to the Person in whose name this Series B Security (or one or

more Predecessor Securities) is registered at the close of business on a

Special Record Date for the payment of such defaulted interest to be fixed by

the Trustee, notice whereof shall be given to Holders of Series B Securities

not less than 10 days prior to such Special Record Date, or may be paid at

any time in any other lawful manner not inconsistent with the requirements of

any securities exchange on which the Series B Securities may be listed, and

upon such notice as may be required by such exchange, all as more fully

provided in said Indenture.

 

This Series B Security was issued pursuant to the Exchange Offer

pursuant to which the 8% Senior Subordinated Notes due 2012, Series A (herein

called the “Series A Securities”) in like principal amount were exchanged for

the Series B Securities.  The Series B

Securities rank pari  passu in right of payment with the Series A

Securities.

 

In addition, pursuant to the Registration Rights Agreement, dated as of

March 14, 2002, among the Company, the Guarantors and the Initial Purchasers

for any period in which the Series A Security exchanged for this Series B

Security was outstanding:

 

(i) (A) if an Exchange Offer Registration Statement (or, in the event

of a change in applicable law or due to current interpretations by the

Commission, the Company is not permitted to effect the Exchange Offer, a Shelf

Registration Statement) is not filed within 60 days following the Closing Date,

(B) in the event that within 30 days 

 

38

 

after consummation of the Exchange Offer, any Holder shall notify the

Company that such Holder (x) is prohibited by applicable law or Commission

policy from participating in the Exchange Offer, (y) may not resell Exchange

Securities acquired by it in the Exchange Offer to the public without

delivering a prospectus and that the prospectus contained in the Exchange Offer

Registration Statement is not appropriate or available for such resales by such

Holder or (z) is a broker-dealer and holds Securities acquired directly from

the Company or an “affiliate” of the Company and a Shelf Registration Statement

is not filed within 60 days after such notice or (C) upon the request of an

Initial Purchaser, a Shelf Registration Statement is not filed within 60 days

after such request, then commencing on either the 61st day after the Closing

Date or the expiration of either of the 120-day time periods set forth in

clauses (B) or (C) above (either, a “Prescribed Time Period”), as the case may

be, Penalty Interest shall be accrued on the Series A Securities over and above

the stated payment rates thereon at a rate of .50% per annum for the first 90

days immediately following either the 61st day after the Closing Date or the

expiration of the applicable Prescribed Time Period, as the case may be, such

Penalty Interest rate increasing by an additional .25% per annum at the

beginning of each subsequent 90-day period;

 

(ii) if an Exchange Offer Registration Statement or a Shelf

Registration Statement is filed pursuant to clause (i) of the preceding full

paragraph and is not declared effective within either 120 days following the

Closing Date or 60 days following the expiration of the applicable Prescribed

Time Period, as the case may be, then commencing on the 121st day after either

the Closing Date or the 61st day following the expiration of the

applicable Prescribed Time Period, as the case may be, Penalty Interest shall

be accrued on the Series A Securities over and above the accrued stated payment

rates thereon at a rate of .50% per annum for the first 90 days immediately

following the 181st day after either the Closing Date or the 61st

day after the expiration of the applicable Prescribed Time Period, as the case

may be, such Penalty Interest rate increasing by an additional .25% per annum

at the beginning of each subsequent 90-day period; and

 

(iii) if either (A) the Company has not exchanged the Exchange

Securities (as defined in the Registration Rights Agreement) for all of the

Securities validly tendered in accordance with the terms of the Exchange Offer

on or prior to 150 days after the Closing Date or (B) if applicable, a Shelf

Registration Statement has been declared effective and such Shelf Registration

Statement ceases to be effective prior to two years from its original effective

date or such shorter period that will terminate when all of the Series A

Securities covered by the Shelf Registration Statement have been sold pursuant

to the Shelf Registration Statement, then, subject to certain exceptions,

Penalty Interest shall be accrued on the Series A Securities over and above the

stated payment rates at a rate of .50% per annum for the first 90 days

immediately following the (x) 151st day after the Closing Date in the case of

(A) above or (y) the day such Shelf Registration Statement 

 

39

 

ceases to be effective in the case of (B) above, such Penalty Interest

rate increasing by an additional .25% per annum at the beginning of each

subsequent 90-day period;

 

provided, however, that the Penalty Interest rate on the

Series A Securities may not exceed 1.5% per annum; and provided, further,

that (1) upon the filing of the Exchange Offer Registration Statement or a

Shelf Registration Statement (in the case of (i) above), (2) upon the

effectiveness of the Exchange Offer Registration Statement or a Shelf

Registration Statement (in the case of (ii) above) or (3) upon the exchange of

Exchange Securities for all Series A Securities tendered in the Exchange Offer

or upon the effectiveness of the Shelf Registration Statement which had ceased

to remain effective prior to two years from its original effective date (in the

case of (iii) above), Penalty Interest as a result of such clause (i), (ii) or

(iii) shall cease to accrue.

 

Any Penalty Interest due pursuant to clause (i), (ii) or (iii) above

will be payable in cash on the Interest Payment Date related to the Series A

Securities.  The Penalty Interest will

be determined by multiplying the applicable Penalty Interest rate by the principal

amount of the Series A Securities, multiplied by a fraction the numerator of

which is the number of days such Penalty Interest rate was applicable during

such period, and the denominator of which is 360.

 

Payment of the principal of, premium, if any, and interest on this

Series B Security will be made at the office or agency of the Company

maintained for that purpose, in such coin or currency of the United States of

America as at the time of payment is legal tender for payment of public and

private debts; provided, however, that payment of interest may be

made at the option of the Company by check mailed to the address of the Person

entitled thereto as such address shall appear on the Security Register.  If any of the Series B Securities are held

by the Depositary, payments of interest to the Depositary may be made by wire

transfer to the Depositary.  Interest

shall be computed on the basis of a 360-day year of twelve 30-day months.

 

Reference is hereby made to the further provisions of this Series B

Security set forth on the reverse hereof, which further provisions shall for

all purposes have the same effect as if set forth at this place.

 

This Series B Security is entitled to the benefits of Guarantees by

each of the Guarantors of the punctual payment when due of the Indenture

Obligations made in favor of the Trustee for the benefit of the Holders.  Reference is hereby made to Article Fourteen

of the Indenture for a statement of the respective rights, limitations of

rights, duties and obligations under the Guarantees of each of the Guarantors.

 

All references in this Series B Security or in the Indenture to accrued

and unpaid interest shall be deemed to include, to the extent applicable, a

reference to Penalty Interest.

 

40

 

Unless the certificate of authentication hereon has been duly executed

by the Trustee referred to on the reverse hereof or by the authenticating agent

appointed as provided in the Indenture by manual signature, this Series B

Security shall not be entitled to any benefit under the Indenture, or be valid

or obligatory for any purpose.

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly

executed by the manual or facsimile signature of its authorized officers.

 

	

  Dated:

  	

  SINCLAIR BROADCAST GROUP, INC.

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

  Attest:

  	

   

  
	

   

  	

   

  
	

   

  	

   

  	

   

  
	

  Secretary

  	

   

  	

   

  

 

Section 203.  Form of Reverse of Securities.

 

(a)           The form of the

reverse of the Series A Securities shall be substantially as follows:

 

SINCLAIR BROADCAST GROUP, INC.

8% SENIOR

SUBORDINATED NOTE DUE 2012, SERIES A

 

This Security is one of a duly authorized issue of Securities of the

Company designated as its 8% Senior Subordinated Notes due 2012, Series A

(herein called the “Securities”), initially limited (except as otherwise

provided in the Indenture referred to below) in aggregate principal amount to

$300,000,000, which may be issued under an indenture (herein called the

“Indenture”), dated as of March 14, 2002, among the Company, the Guarantors and

First Union National Bank, as trustee (herein called the “Trustee,” which term

includes any successor trustee under the Indenture), to which Indenture and all

indentures supplemental thereto reference is hereby made for a statement of the

respective rights, limitations of rights, duties, obligations and immunities

thereunder of the Company, the Guarantors, the Trustee and the Holders of the

Securities, and of the terms upon which the Securities and the Guarantees are,

and are to be, authenticated and delivered.

 

The Company may, from time to time, without notice to or the consent of

the Holders of the Securities, create and issue further Securities (“Additional

Securities”) 

 

41

 

under the Indenture ranking equally with the Securities in all

respects, subject to the limitations described in Section 1008 of the

Indenture.  Such Additional Securities

will be consolidated and form a single series with the Securities, vote

together with the Securities and have the same terms as to status, redemption or

otherwise as the Securities.

 

The Indenture contains provisions for defeasance at any time of

(a) the entire Indebtedness on the Securities and (b) certain

restrictive covenants and related Defaults and Events of Default, in each case

upon compliance or noncompliance with certain conditions set forth therein.

 

The Indebtedness evidenced by the Securities is, to the extent and in

the manner provided in the Indenture, subordinate and subject in right of

payment to the prior payment in full of all Senior Indebtedness, whether

Outstanding on the date of the Indenture or thereafter, and this Security is

issued subject to such provisions.  Each

Holder of this Security, by accepting the same, (a) agrees to and shall be

bound by such provisions, (b) authorizes and directs the Trustee on his

behalf to take such action as may be necessary or appropriate to effectuate the

subordination as provided in the Indenture and (c) appoints the Trustee

his attorney-in-fact for such purpose; provided, however, that,

subject to Section 406 of the Indenture, the Indebtedness evidenced by this

Security shall cease to be so subordinate and subject in right of payment upon

any defeasance of this Security referred to in clause (a) or (b) of the

preceding paragraph.

 

The Securities are subject to redemption at any time on or after March

15, 2007, at the option of the Company, in whole or in part, on not less than

30 nor more than 60 days’ prior notice by first-class mail in amounts of $1,000

or an integral multiple of $1,000 at the following redemption prices (expressed

as a percentage of the principal amount), if redeemed during the 12-month

period beginning March 15 of the years indicated below:

 

	

  

  Year

  	

   

  	

   

  	

  Redemption

  Price

  	

   

  
	

  2007

  	

   

  	

  104.000

  	

  %

  
	

  2008

  	

   

  	

  102.667

  	

  %

  
	

  2009

  	

   

  	

  101.333

  	

  %

  
						

 

and thereafter at

100% of the principal amount, in each case together with accrued and unpaid

interest, if any, to the Redemption Date (subject to the right of Holders of

record on relevant record dates to receive interest due on an interest payment

date).  If less than all of the

Securities are to be redeemed, the Trustee shall select the Securities or

portions thereof to be redeemed pro rata, by lot or by any other method the

Trustee shall deem fair and reasonable.

 

42

 

In addition, at any time on or prior to March 15, 2005, the Company may

redeem up to 25% of the principal amount of Securities issued under the

Indenture with the net proceeds of a Public Equity Offering of the Company at

108.000% of the aggregate principal amount, together with accrued and unpaid

interest, if any, to the Redemption Date (subject to the right of Holders of

record on relevant record dates to receive interest due on an interest payment

date).  The Trustee shall select the

Securities or portions thereof to be redeemed pro rata, by lot or by any other

method the Trustee shall deem fair and reasonable.

 

Upon the occurrence of a Change of Control, each Holder may require the

Company to repurchase all or a portion of such Holder’s Securities in an amount

of $1,000 or integral multiples of $1,000, at a purchase price in cash equal to

101% of the principal amount thereof, together with accrued and unpaid

interest, if any, to the date of repurchase.

 

Under certain circumstances, in the event the Net Cash Proceeds

received by the Company or a Restricted Subsidiary from any Asset Sale, which

proceeds are not used to prepay Senior Indebtedness or invested in properties

or assets used in the businesses of the Company, exceed $5,000,000 the Company

will be required to apply such proceeds to the repayment of the Securities and

certain Indebtedness ranking pari  passu to the Securities.

 

In the case of any redemption of Securities, interest installments

whose Stated Maturity is on or prior to the Redemption Date will be payable to

the Holders of such Securities of record as of the close of business on the

relevant record date referred to on the face hereof.  Securities (or portions thereof) for whose redemption and payment

provision is made in accordance with the Indenture shall cease to bear interest

from and after the date of redemption.

 

In the event of redemption of this Security in part only, a new

Security or Securities for the unredeemed portion hereof shall be issued in the

name of the Holder hereof upon the cancellation hereof.

 

If an Event of Default shall occur and be continuing, the principal

amount of all the Securities may be declared due and payable in the manner and

with the effect provided in the Indenture.

 

If this Security is in certificated form, then as provided in the

Indenture and subject to certain limitations therein set forth, the transfer of

this Security is registrable on the Security Register of the Company, upon

surrender of this Security for registration of transfer at the office or agency

of the Company maintained for such purpose, duly endorsed by, or accompanied by

a written instrument of transfer in form satisfactory to the Company and the

Security Registrar duly executed by, the Holder hereof or its 

 

43

 

attorney duly authorized in writing, and thereupon one or more new

Securities, of authorized denominations and for the same aggregate principal

amount, will be issued to the designated transferee or transferees.

 

If this Security is a Global Security, except as described below, it is

not exchangeable for a Security or Securities in certificated form.  The Securities will be delivered in

certificated form if (i) the Depositary ceases to be registered as a

clearing agency under the Exchange Act or is no longer willing or able to

provide securities depository services with respect to the Securities,

(ii) the Company so determines or (iii) there shall have occurred an

Event of Default or an event which, with the giving of notice or lapse of time

or both, would constitute an Event of Default with respect to the Securities

represented by such Global Security and such Event of Default or event

continues for a period of 90 days.  Upon

any such issuance, the Trustee is required to register such certificated

Security in the name of, and cause the same to be delivered to, such Person or

Persons (or the nominee of any thereof). 

All such certificated Securities would be required to include the

Restricted Securities Legend.

 

At any time when the Company is not subject to Sections 13 or 15(d) of

the Exchange Act, upon the written request of a Holder of a Security, the

Company will promptly furnish or cause to be furnished Rule 144A Information to

such Holder or to a prospective purchaser of such Security who such Holder

informs the Company is reasonably believed to be a QIB, as the case may be, in

order to permit compliance by such Holder with Rule 144A under the Securities

Act.

 

The Indenture permits, with certain exceptions (including certain

amendments permitted without the consent of any Holders) as therein provided,

the amendment thereof and the modification of the rights and obligations of the

Company and the Guarantors and the rights of the Holders under the Indenture

and the Guarantees at any time by the Company, the Guarantors and the Trustee

with the consent of the Holders of a specified percentage in aggregate

principal amount of the Securities at the time Outstanding.  The Indenture also contains provisions

permitting the Holders of specified percentages in aggregate principal amount

of the Securities at the time Outstanding, on behalf of the Holders of all the

Securities, to waive compliance by the Company and the Guarantors with certain

provisions of the Indenture and the Guarantees and certain past Defaults under

the Indenture and the Guarantees and their consequences.  Any such consent or waiver by or on behalf

of the Holder of this Security shall be conclusive and binding upon such Holder

and upon all future Holders of this Security and of any Security issued upon

the registration of transfer hereof or in exchange herefor or in lieu hereof

whether or not notation of such consent or waiver is made upon this Security.

 

No reference herein to the Indenture and no provision of this Security

or of the Indenture shall alter or impair the obligation of the Company, any

Guarantor or any other obligor upon the Securities (in the event such other

obligor is obligated to make payments 

 

44

 

in respect of the Securities), which is absolute and unconditional, to

pay the principal of, premium, if any, and interest on this Security at the

times, place, and rate, and in the coin or currency, herein prescribed, subject

to the subordination provisions of the Indenture.

 

The Securities are issuable only in registered form without coupons in

denominations of $1,000 and any integral multiple thereof.  As provided in the Indenture and subject to

certain limitations therein set forth, the Securities are exchangeable for a

like aggregate principal amount of Securities of a different authorized

denomination, as requested by the Holder surrendering the same.

 

No service charge shall be made for any registration of transfer or

exchange or redemption of Securities, but the Company may require payment of a

sum sufficient to cover any tax or other governmental charge payable in

connection therewith.

 

Prior to and at the time of due presentment of this Security for

registration of transfer, the Company, the Trustee and any agent of the Company

or the Trustee may treat the Person in whose name this Security is registered

as the owner hereof for all purposes (subject to provisions with respect to

record dates for the payment of interest), whether or not this Security is

overdue, and neither the Company, the Trustee nor any agent shall be affected

by notice to the contrary.

 

THIS

SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF

THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAWS

PRINCIPLES THEREOF).

 

All terms used in this Security which are defined in the Indenture and

not otherwise defined herein shall have the meanings assigned to them in the

Indenture.

 

OPTION OF HOLDER

TO ELECT PURCHASE

 

If you wish to have this Security purchased by the Company pursuant to

Section 1013 or Section 1016, as applicable, of the Indenture, check the

Box:  o.

 

If you wish to have a portion of this Security purchased by the Company

pursuant to Section 1013 or Section 1016 as applicable, of the Indenture, state

the amount (in original principal amount):

 

$ __________________ .

 

45

 

	

  Date:  

  	

   

  	

   

  	

  Your Signature: 

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

  (Sign exactly as your name appears on the other side

  of this Security)

  	

   

  
	

   

  	

   

  
	

  Signature Guarantee:

  	

   

  	

   

  
								

 

[Signature must be guaranteed by an

eligible Guarantor Institution (banks, stock brokers, savings and loan

associations and credit unions) with membership in an approved guarantee

medallion program pursuant to Securities and Exchange Commission Rule 17Ad-15]

 

(b)           The form of the

reverse of the Series B Securities shall be substantially as follows:

 

SINCLAIR BROADCAST GROUP, INC.

8% SENIOR

SUBORDINATED NOTE DUE 2012, SERIES B

 

This Security is one of a duly authorized issue of Securities of the

Company designated as its 8% Senior Subordinated Notes due 2012, Series B

(herein called the “Securities”), initially limited (except as otherwise

provided in the Indenture referred to below) in aggregate principal amount to

$300,000,000, which may be issued under an indenture (herein called the “Indenture”),

dated as of March 14, 2002, among the Company, the Guarantors and First Union

National Bank, as trustee (herein called the “Trustee,” which term includes any

successor trustee under the Indenture), to which Indenture and all indentures

supplemental thereto reference is hereby made for a statement of the respective

rights, limitations of rights, duties, obligations and immunities thereunder of

the Company, the Guarantors, the Trustee and the Holders of the Securities, and

of the terms upon which the Securities and the Guarantees are, and are to be,

authenticated and delivered.

 

The Company may, from time to time, without notice to or the consent of

the Holders of the Securities, create and issue further Securities (“Additional

Securities”) under the Indenture ranking equally with the Securities in all

respects, subject to the limitations described in Section 1008 of the

Indenture.  Such Additional Securities

will be consolidated and form a single series with the Securities, vote

together with the Securities and have the same terms as to status, redemption

or otherwise as the Securities.

 

The Indenture contains provisions for defeasance at any time of

(a) the entire Indebtedness on the Securities and (b) certain

restrictive covenants and related Defaults and Events of Default, in each case

upon compliance or noncompliance with certain conditions set forth therein.

 

46

 

The Indebtedness evidenced by the Securities is, to the extent and in

the manner provided in the Indenture, subordinate and subject in right of

payment to the prior payment in full of all Senior Indebtedness, whether

Outstanding on the date of the Indenture or thereafter, and this Security is

issued subject to such provisions.  Each

Holder of this Security, by accepting the same, (a) agrees to and shall be

bound by such provisions, (b) authorizes and directs the Trustee on his

behalf to take such action as may be necessary or appropriate to effectuate the

subordination as provided in the Indenture and (c) appoints the Trustee

his attorney-in-fact for such purpose; provided, however, that,

subject to Section 406 of the Indenture, the Indebtedness evidenced by this

Security shall cease to be so subordinate and subject in right of payment upon any

defeasance of this Security referred to in clause (a) or (b) of the preceding

paragraph.

 

The Securities are subject to redemption at any time on or after March

15, 2007, at the option of the Company, in whole or in part, on not less than

30 nor more than 60 days’ prior notice by first-class mail in amounts of $1,000

or an integral multiple of $1,000 at the following redemption prices (expressed

as a percentage of the principal amount), if redeemed during the 12-month

period beginning March 15 of the years indicated below:

 

	

  

  Year

  	

   

  	

   

  	

  Redemption

  Price

  	

   

  
	

  2007

  	

   

  	

  104.000

  	

  %

  
	

  2008

  	

   

  	

  102.667

  	

  %

  
	

  2009

  	

   

  	

  101.333

  	

  %

  

 

and thereafter at

100% of the principal amount, in each case together with accrued and unpaid

interest, if any, to the Redemption Date (subject to the right of Holders of

record on relevant record dates to receive interest due on an interest payment

date).  If less than all of the

Securities are to be redeemed, the Trustee shall select the Securities or

portions thereof to be redeemed pro rata, by lot or by any other method the

Trustee shall deem fair and reasonable.

 

In addition, at any time on or prior to March 15, 2005, the Company may

redeem up to 25% of the principal amount of Securities issued under the

Indenture with the net proceeds of a Public Equity Offering of the Company at

108.000% of the aggregate principal amount, together with accrued and unpaid

interest, if any, to the Redemption Date (subject to the right of Holders of

record on relevant record dates to receive interest due on an interest payment

date).  The Trustee shall select the

Securities or portions thereof to be redeemed pro rata, by lot or by any other

method the Trustee shall deem fair and reasonable.

 

47

 

Upon the occurrence of a Change of Control, each Holder may require the

Company to repurchase all or a portion of such Holder’s Securities in an amount

of $1,000 or integral multiples of $1,000, at a purchase price in cash equal to

101% of the principal amount thereof, together with accrued and unpaid

interest, if any, to the date of repurchase.

 

Under certain circumstances, in the event the Net Cash Proceeds

received by the Company or a Restricted Subsidiary from any Asset Sale, which

proceeds are not used to prepay Senior Indebtedness or invested in properties

or assets used in the businesses of the Company, exceed $5,000,000 the Company

will be required to apply such proceeds to the repayment of the Securities and

certain Indebtedness ranking pari  passu to the Securities.

 

In the case of any redemption of Securities, interest installments

whose Stated Maturity is on or prior to the Redemption Date will be payable to

the Holders of such Securities of record as of the close of business on the

relevant record date referred to on the face hereof.  Securities (or portions thereof) for whose redemption and payment

provision is made in accordance with the Indenture shall cease to bear interest

from and after the date of redemption.

 

In the event of redemption of this Security in part only, a new

Security or Securities for the unredeemed portion hereof shall be issued in the

name of the Holder hereof upon the cancellation hereof.

 

If an Event of Default shall occur and be continuing, the principal

amount of all the Securities may be declared due and payable in the manner and

with the effect provided in the Indenture.

 

If this Security is in certificated form, then as provided in the

Indenture and subject to certain limitations therein set forth, the transfer of

this Security is registrable on the Security Register of the Company, upon

surrender of this Security for registration of transfer at the office or agency

of the Company maintained for such purpose, duly endorsed by, or accompanied by

a written instrument of transfer in form satisfactory to the Company and the

Security Registrar duly executed by, the Holder hereof or its attorney duly

authorized in writing, and thereupon one or more new Securities, of authorized

denominations and for the same aggregate principal amount, will be issued to the

designated transferee or transferees.

 

If this Security is a Global Security, except as described below, it is

not exchangeable for a Security or Securities in certificated form.  The Securities will be delivered in

certificated form if (i) the Depositary ceases to be registered as a

clearing agency under the Exchange Act or is no longer willing or able to

provide securities depository services with respect to the Securities,

(ii) the Company so determines or 

 

48

 

(iii) there shall have occurred an Event of Default or an event

which, with the giving of notice or lapse of time or both, would constitute an

Event of Default with respect to the Securities represented by such Global

Security and such Event of Default or event continues for a period of 90

days.  Upon any such issuance, the

Trustee is required to register such certificated Security in the name of, and

cause the same to be delivered to, such Person or Persons (or the nominee of

any thereof).

 

The Indenture permits, with certain exceptions (including certain

amendments permitted without the consent of any Holders) as therein provided,

the amendment thereof and the modification of the rights and obligations of the

Company and the Guarantors and the rights of the Holders under the Indenture

and the Guarantees at any time by the Company, the Guarantors and the Trustee

with the consent of the Holders of a specified percentage in aggregate

principal amount of the Securities at the time Outstanding.  The Indenture also contains provisions

permitting the Holders of specified percentages in aggregate principal amount

of the Securities at the time Outstanding, on behalf of the Holders of all the

Securities, to waive compliance by the Company and the Guarantors with certain

provisions of the Indenture and the Guarantees and certain past Defaults under

the Indenture and the Guarantees and their consequences.  Any such consent or waiver by or on behalf

of the Holder of this Security shall be conclusive and binding upon such Holder

and upon all future Holders of this Security and of any Security issued upon

the registration of transfer hereof or in exchange herefor or in lieu hereof

whether or not notation of such consent or waiver is made upon this Security.

 

No reference herein to the Indenture and no provision of this Security

or of the Indenture shall alter or impair the obligation of the Company, any

Guarantor or any other obligor upon the Securities (in the event such other

obligor is obligated to make payments in respect of the Securities), which is

absolute and unconditional, to pay the principal of, premium, if any, and

interest on this Security at the times, place, and rate, and in the coin or

currency, herein prescribed, subject to the subordination provisions of the

Indenture.

 

The Securities are issuable only in registered form without coupons in

denominations of $1,000 and any integral multiple thereof.  As provided in the Indenture and subject to

certain limitations therein set forth, the Securities are exchangeable for a

like aggregate principal amount of Securities of a different authorized

denomination, as requested by the Holder surrendering the same.

 

No service charge shall be made for any registration of transfer or

exchange or redemption of Securities, but the Company may require payment of a

sum sufficient to cover any tax or other governmental charge payable in

connection therewith.

 

Prior to and at the time of due presentment of this Security for

registration of transfer, the Company, the Trustee and any agent of the Company

or the Trustee may treat the Person in whose name this Security is registered

as the owner hereof for all purposes 

 

49

 

(subject to provisions

with respect to record dates for the payment of interest), whether or not this

Security is overdue, and neither the Company, the Trustee nor any agent shall

be affected by notice to the contrary.

 

THIS

SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF

THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAWS

PRINCIPLES THEREOF).

 

All terms used in this Security which are defined in the Indenture and

not otherwise defined herein shall have the meanings assigned to them in the

Indenture.

 

OPTION OF HOLDER

TO ELECT PURCHASE

 

If you wish to have this Security purchased by the Company pursuant to

Section 1013 or Section 1016, as applicable, of the Indenture, check the

Box:  o.

 

If you wish to have a portion of this Security purchased by the Company

pursuant to Section 1013 or Section 1016 as applicable, of the Indenture, state

the amount (in original principal amount):

 

$ ________________ .

 

	

  Date:  

  	

   

  	

   

  	

  Your Signature: 

  	

   

  	

   

  
	

  (Sign exactly as your name appears on the other side

  of this Security)

  	

   

  
	

   

  	

   

  
	

  Signature Guarantee:

  	

   

  	

   

  
								

 

[Signature must be guaranteed by an

eligible Guarantor Institution (banks, stock brokers, savings and loan

associations and credit unions) with membership in an approved guarantee

medallion program pursuant to Securities and Exchange Commission Rule 17Ad-15]

 

Section 204.  Additional Provisions Required in Global

Security.

 

Any Global Security issued hereunder shall, in addition to the

provisions contained in Sections 202 and 203, bear a legend in substantially

the following form:

 

50

 

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE

HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A

NOMINEE OF A DEPOSITARY.  THIS SECURITY

IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN

THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN

THE INDENTURE AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO

A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY

OR ANOTHER NOMINEE OF THE DEPOSITARY, EXCEPT IN THE LIMITED CIRCUMSTANCES

DESCRIBED IN THE INDENTURE.

 

If The

Depository Trust Company is acting as the Depositary, insert — UNLESS THIS CERTIFICATE IS PRESENTED BY

AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK

CORPORATION (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,

EXCHANGE, OR PAYMENT AND ANY SUCH CERTIFICATE ISSUED IS REGISTERED IN THE NAME

OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED

REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH

OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY

TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON

IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN

INTEREST HEREIN.

 

Section 205.  Form of Trustee’s Certificate of

Authentication.

 

The Trustee’s certificate of authentication shall be included on the

Securities and shall be substantially in the form as follows:

 

TRUSTEE’S

CERTIFICATE OF AUTHENTICATION.

 

This is one of the Securities referred to in the within-mentioned

Indenture.

 

	

   

  	

  FIRST UNION NATIONAL BANK,

  
	

   

  	

  As Trustee

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

  Authorized Signatory

  

 

Section 206.  Form of Guarantee of Each of the

Guarantors.

 

The form of Guarantee shall be set forth on the Securities

substantially as follows:

 

51

 

GUARANTEES

 

For value received, each of the undersigned hereby unconditionally

guarantees, jointly and severally, to the holder of this Security the payment

of principal of, premium, if any, and interest on this Security in the amounts

and at the time when due and interest on the overdue principal and interest, if

any, of this Security, if lawful, and the payment or performance of all other

obligations of the Company under the Indenture or the Securities, to the holder

of this Security and the Trustee, all in accordance with and subject to the

terms and limitations of this Security and Article Fourteen of the

Indenture.  These Guarantees will not

become effective until the Trustee duly executes the certificate of

authentication on this Security.  The

Indebtedness evidenced by these Guarantees is, to the extent and in the manner

provided in the Indenture, subordinate and subject in right of payment to the

prior payment in full of all Guarantor Senior Indebtedness (as defined in the

Indenture), whether Outstanding on the date of the Indenture or thereafter, and

these Guarantees are issued subject to such provisions.

 

	

  GUARANTORS:

  
	

   

  
	

  CHESAPEAKE TELEVISION, INC.

  
	

  KSMO, INC.

  
	

  WCGV, INC.

  
	

  SINCLAIR ACQUISITION IV, INC.

  
	

  WLFL, INC.

  
	

  SINCLAIR MEDIA I, INC.

  
	

  WSMH, INC.

  
	

  SINCLAIR MEDIA II, INC.

  
	

  WSTR LICENSEE, INC.

  
	

  WGME, INC.

  
	

  SINCLAIR MEDIA III, INC.

  
	

  WTTE, CHANNEL 28 LICENSEE, INC.

  
	

  WTTO, INC.

  
	

  WTVZ, INC.

  
	

  WYZZ, INC.

  
	

  KOCB, INC.

  
	

  FSF-TV, INC.

  
	

  KSMO LICENSEE, INC.

  
	

  WDKY, INC.

  
	

  WYZZ LICENSEE, INC.

  
	

  KLGT, INC.

  
	

  SINCLAIR TELEVISION COMPANY II, INC. 
   (F/K/A SINCLAIR ACQUISITION II,

  INC.)

  

 

52

 

	

  SINCLAIR COMMUNICATIONS, INC.

  
	

  WSYX LICENSEE, INC.

  
	

  WGGB, INC.

  
	

  WTWC, INC.

  
	

  SINCLAIR COMMUNICATIONS II, INC.

  
	

  SINCLAIR HOLDINGS I, INC.

  
	

  SINCLAIR HOLDINGS II, INC.

  
	

  SINCLAIR HOLDINGS III, INC.

  
	

  SINCLAIR TELEVISION COMPANY, INC.

  
	

  SINCLAIR TELEVISION OF BUFFALO, INC.

  
	

  SINCLAIR TELEVISION OF CHARLESTON, INC.

  
	

  SINCLAIR TELEVISION OF NASHVILLE, INC.

  
	

  SINCLAIR TELEVISION OF NEVADA, INC.

  
	

  SINCLAIR TELEVISION OF OKLAHOMA, INC.

  
	

  SINCLAIR TELEVISION OF TENNESSEE, INC.

  
	

  SINCLAIR TELEVISION LICENSE HOLDER, INC.

  
	

  SINCLAIR TELEVISION OF DAYTON, INC.

  
	

  SINCLAIR ACQUISITION VII,

  INC.

  
	

  SINCLAIR ACQUISITION VIII,

  INC.

  
	

  SINCLAIR ACQUISITION IX, INC.

  
	

  SINCLAIR ACQUISITION X, INC.

  
	

  SINCLAIR ACQUISITION XI, INC.

  
	

  SINCLAIR ACQUISITION XII,

  INC.

  
	

  MONTECITO BROADCASTING CORPORATION

  
	

  CHANNEL 33, INC.

  
	

  WNYO, INC.

  
	

  NEW YORK TELEVISION, INC.

  
	

  BIRMINGHAM (WABM-TV) LICENSEE, INC.

  
	

  RALEIGH (WRDC-TV) LICENSEE, INC.

  
	

  SAN ANTONIO (KRRT-TV) LICENSEE, INC.

  
	

  WVTV LICENSEE, INC.

  

 

 

	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President (as to all)

  
					

 

53

 

	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary (as to all)

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  SINCLAIR PROPERTIES, LLC

  
	

   

  	

  SINCLAIR PROPERTIES II, LLC

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  Manager (as to both)

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Manager (as to both)

  	

   

  	

   

  
									

 

 

	

   

  	

  KBSI LICENSEE L.P.

  	

   

  
	

   

  	

  KETK LICENSEE L.P.

  	

   

  
	

   

  	

  WMMP LICENSEE L.P.

  	

   

  
	

   

  	

  WSYT LICENSEE L.P.

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair

  Properties, LLC,

  
	

   

  	

   

  	

  General

  Partner

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  Manager

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Manager

  	

   

  	

   

  
	

   

  	

  WEMT LICENSEE L.P.

  	

   

  
	

   

  	

  WKEF LICENSEE L.P.

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair

  Properties II, LLC,

  
	

   

  	

   

  	

  General

  Partner

  
										

 

54

 

	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  Manager

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Manager

  	

   

  	

   

  
									

 

 

	

   

  	

  WGME LICENSEE LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  WGME,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  WICD LICENSEE, LLC

  	

   

  
	

   

  	

  WICS LICENSEE, LLC

  	

   

  
	

   

  	

  KGAN LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair

  Acquisition IV, Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  WSMH LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  WSMH,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

55

 

	

   

  	

  WPGH LICENSEE, LLC

  	

   

  
	

   

  	

  KDNL LICENSEE, LLC

  	

   

  
	

   

  	

  WCWB LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair

  Media I, Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

  Title:

  	

  Secretary

  	

   

  	

   

  
									

 

 

	

   

  	

  WTVZ LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  WTVZ,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  CHESAPEAKE TELEVISION LICENSEE, LLC

  
	

   

  	

  KABB LICENSEE, LLC

  
	

   

  	

  SCI - SACRAMENTO LICENSEE, LLC

  
	

   

  	

  WLOS LICENSEE, LLC

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Chesapeake

  Television, Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

56

 

	

   

  	

  KLGT LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  KLGT,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  WCGV LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  WCGV,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  SCI - INDIANA LICENSEE, LLC

  	

   

  
	

   

  	

  KUPN LICENSEE, LLC

  	

   

  
	

   

  	

  WEAR LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair

  Media II, Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

57

 

 

	

   

  	

  WLFL LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  WLFL,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  WTTO LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  WTTO,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  WTWC LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  WTWC,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

58

 

	

   

  	

  WGGB LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  WGGB,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  KOCB LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  KOCB,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  WDKY LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  WDKY,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

59

 

	

   

  	

  KOKH LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair

  Television of Oklahoma, Inc.,

  
	

   

  	

  Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  WUPN LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair

  Television of Buffalo, Inc.,

  
	

   

  	

  Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  WUXP LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair

  Television of Tennessee, Inc.,

  
	

   

  	

  Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

60

 

	

   

  	

  WCHS LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair

  Media III, Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  SINCLAIR FINANCE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  KLGT,

  Inc., Member

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

 

	

   

  	

  WMSN LICENSEE, LLC

  	

   

  
	

   

  	

  WRLH LICENSEE, LLC

  	

   

  
	

   

  	

  WUTV LICENSEE, LLC

  	

   

  
	

   

  	

  WXLV LICENSEE, LLC

  	

   

  
	

   

  	

  WZTV LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair Television Company II,

  Inc.,

  
	

   

  	

  Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

61

 

	

   

  	

  WUHF LICENSEE, LLC

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair Television Company,

  Inc.,

  
	

   

  	

  Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:  

  	

  David D. Smith

  
	

   

  	

   

  	

  Title:  

  	

  President

  
	

   

  	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:  

  	

  David B. Amy

  	

   

  	

   

  
	

   

  	

  Title:

  	

  Secretary

  	

   

  	

   

  
										

 

62

 

ARTICLE THREE

 

THE SECURITIES

 

Section 301.  Title and Terms.

 

The initial aggregate principal amount of Securities which will be

authenticated and delivered under this Indenture is $300,000,000 in principal

amount of Securities, except for Securities authenticated and delivered upon

registration of transfer of, or in exchange for, or in lieu of, other

Securities pursuant to Section 303, 304, 305, 306, 307, 308, 906, 1013, 1016 or

1108.  Notwithstanding the foregoing,

the Company may, from time to time, without notice to or the consent of the

Holders of Securities, create and issue further Securities (“Additional

Securities”) under this Indenture ranking equally with the Securities in all

respects, subject to the limitations described in Section 1008 hereof.  Such Additional Securities will be

consolidated and form a single series with the Securities, vote together with

the Securities and have the same terms as to status, redemption or otherwise as

the Securities.

 

The Securities shall be known and designated as the “8% Senior

Subordinated Notes due 2012”, in the case of either Series A or Series B, of

the Company.  The Stated Maturity of the

Securities shall be March 15, 2012, and the Securities shall each bear interest

at the rate of 8% plus Penalty Interest, if any, from March 14, 2002 or from

the most recent Interest Payment Date to which interest has been paid, as the

case may be, payable on September 15, 2002 and semiannually thereafter on March

15 and September 15, in each year, until the principal thereof is paid or duly

provided for.

 

Unless otherwise specified herein, the Series A Securities and the

Series B Securities will be treated as one class and are together referred to

as the “Securities.”  The Series A

Securities rank pari  passu in right of payment with the Series B

Securities.

 

The principal of, premium, if any, and interest on the Securities shall

be payable at the office or agency of the Company maintained for such purpose; provided,

however, that at the option of the Company interest may be paid (i) by

check mailed to addresses of the Persons entitled thereto as such addresses

shall appear on the Security Register or (ii) by wire transfer in immediately available

funds to an account specified (not later than one Business Day prior to the

applicable Interest Payment Date) by the Holder thereof.  If any of the Securities are held by the

Depositary, payments of interest may be made by wire transfer to the Depositary.  The Trustee is hereby initially designated

as the Paying Agent under this Indenture.

 

The Securities shall be redeemable as provided in Article Eleven.

 

63

 

The obligations of the Company pursuant to the

Securities shall be guaranteed by each and every Guarantor as provided in

Article Fourteen of the Indenture.

 

The Securities shall be redeemable, at the option of

the Holder, upon a Change of Control as provided in Section 1016 of this

Indenture.

 

At the election of the Company, the entire

Indebtedness on the Securities or certain of the Company’s obligations and

covenants and certain Events of Default thereunder may be defeased as provided

in Article Four.

 

The Securities shall be subordinated in right of

payment to Senior Indebtedness as provided in Article Twelve.

 

Section 302.  Denominations.

 

The Securities shall be issuable only in registered

form without coupons and only in denominations of $1,000 and any integral

multiple thereof.

 

Section 303.  Execution, Authentication, Delivery and

Dating.

 

The Securities shall be executed on behalf of the

Company by one of its Chairman of the Board, its President or one of its Vice

Presidents attested by its Secretary or one of its Assistant Secretaries.

 

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 on the date of such Securities.

 

At any time and from time to time after the execution

and delivery of this Indenture, the Company may deliver Securities executed by

the Company to the Trustee for authentication, together with a Company Order

for the authentication and delivery of such Securities; and the Trustee in

accordance with such Company Order shall authenticate and deliver such

Securities as provided in this Indenture and not otherwise.

 

Each Security shall be dated the date of its

authentication.

 

No Security shall be entitled to any benefit under

this Indenture or be valid or obligatory for any purpose unless there appears

on such Security a certificate of authentication substantially in the form

provided for herein duly executed by the Trustee by manual signature of an

authorized officer, and such certificate upon any Security shall be conclusive

evidence, and the only evidence, that such Security has been duly authenticated

and delivered hereunder.

 

64

 

In case the Company or any Guarantor, pursuant to

Article Eight, shall be consolidated, merged with or into any other Person or

shall sell, assign, convey, transfer or lease substantially all of its

properties and assets to any Person, and the successor Person resulting from

such consolidation, or surviving such merger, or into which the Company or such

Guarantor shall have been merged, or the Person which shall have received a

sale, assignment, conveyance, transfer or lease as aforesaid, shall have

executed an indenture supplemental hereto with the Trustee pursuant to Article

Eight, any of the Securities authenticated or delivered prior to such

consolidation, merger, sale, assignment, conveyance, transfer or lease may,

from time to time, at the request of the successor Person, be exchanged for

other Securities executed in the name of the successor Person with such changes

in phraseology and form as may be appropriate, but otherwise in substance of

like tenor as the Securities surrendered for such exchange and of like

principal amount; and the Trustee, upon Company Request of the successor

Person, shall authenticate and deliver Securities as specified in such request

for the purpose of such exchange.  If

Securities shall at any time be authenticated and delivered in any new name of

a successor Person pursuant to this Section in exchange or substitution for or

upon registration of transfer of any Securities, such successor Person, at the

option of the Holders but without expense to them, shall provide for the

exchange of all Securities at the time Outstanding for Securities authenticated

and delivered in such new name.

 

The Trustee may appoint an authenticating agent

acceptable to the Company to authenticate Securities on behalf of the

Trustee.  Unless limited by the terms of

such appointment, an authenticating agent may authenticate Securities whenever

the Trustee may do so.  Each reference

in this Indenture to authentication by the Trustee includes authentication by

such agent.  An authenticating agent has

the same rights as any Security Registrar or Paying Agent to deal with the

Company and its Affiliates.

 

Section 304.  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 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.

 

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 1002, 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

 

65

 

denominations.  Until so

exchanged the temporary Securities shall in all respects be entitled to the

same benefits under this Indenture as definitive Securities.

 

Section 305.  Global

Securities.

 

(a)  Each

Global Security initially shall (i) be registered in the name of the

Depositary for such Global Security or the nominee of such Depositary,

(ii) be deposited with, or on behalf of, the Depositary or with the

Trustee as custodian for such Depository and (iii) bear legends as set

forth in Sections 202(a) and 204; provided, however, the Securities

are eligible to be in the form of a Global Security.

 

Members of, or participants in, the Depositary (“Agent

Members”) shall have no rights under this Indenture with respect to any Global

Security held on their behalf by the Depositary, or the Trustee as its

custodian, or under the Global Security, and the Depositary may be treated by

the Company, the Trustee and any agent of the Company or the Trustee as the

absolute owner of such Global Security for all purposes whatsoever.  Notwithstanding the foregoing, nothing

herein shall prevent the Company, the Trustee or any agent of the Company from

giving effect to any written certification, proxy or other authorization

furnished by the Depositary or shall impair, as between the Depositary and its

Agent Members, the operation of customary practices governing the exercise of

the rights of a holder of any Security.

 

(b)  Transfers of the Global Security shall

be limited to transfers of such Global Security in whole, but not in part, to

the Depositary, its successors or their respective nominees.  Interests of beneficial owners in a Global

Security may be transferred in accordance with the rules and procedures of the

Depositary and the provisions of Section 307. 

Under the circumstances described in clause (a) above, and in this

clause (b) below, beneficial owners shall obtain physical securities in the

form set forth in Sections 202, 203, 204 (if applicable) and 205 (“Physical

Securities”) in exchange for their beneficial interests in a Global Security in

accordance with the Depositary’s and the Securities Registrar’s

procedures.  In connection with the

execution, authentication and delivery of such Physical Securities, the

Security Registrar shall reflect on its books and records a decrease in the

principal amount of the Global Security equal to the principal amount of such

Physical Securities and the Company shall execute and the Trustee shall

authenticate and deliver one or more Physical Securities having an equal

aggregate principal amount.  The

Securities will be delivered in certificated form if (i) the Depositary

ceases to be registered as a clearing agency under the Exchange Act or is not

willing or no longer willing or able to provide securities depository services

with respect to the Securities and a successor depositary is not appointed by

the Company within 90 days, (ii) the Company, in its sole discretion, so

determines or (iii) there shall have occurred an Event of Default or an

event which, with the giving of notice or lapse of time or both, would

constitute an Event of Default with respect to the Securities represented by

 

66

 

 

such Global Security and such Event of Default or event continues for a

period of 90 days.

 

(c)  In connection with any transfer of a

portion of the beneficial interest in a Global Security pursuant to subsection

(b) of this Section to beneficial owners who are required to hold Physical Securities,

the Security Registrar shall reflect on its books and records the date and a

decrease in the principal amount of a Global Security in an amount equal to the

principal amount of the beneficial interest in the Global Security to be

transferred, and the Company shall execute, and the Trustee shall authenticate

and deliver, one or more Physical Securities of like tenor and amount.

 

(d)  In connection with the transfer of the

entire Global Security to beneficial owners pursuant to subsection (b) of

this Section, a Global Security shall be deemed to be surrendered to the

Trustee for cancellation, and the Company shall execute, and the Trustee shall

authenticate and deliver, to each beneficial owner identified by the Depositary

in exchange for its beneficial interest in a Global Security, an equal

aggregate principal amount of Physical Securities of authorized denominations.

 

(e)  Any Physical Security delivered in

exchange for an interest in Global Securities pursuant to subsection (c)

or subsection (d) of this Section shall, except as otherwise provided

Section 307, bear the Restricted Securities Legend.

 

(f)  The registered holder of a Global

Security may grant proxies and otherwise authorize any person, including Agent

Members and Persons that may hold interests through Agent Members, to take any

action which a Holder is entitled to take under this Indenture or the

Securities.

 

(g)  The

Depositary or its nominee, as registered owner of a Global Security, shall be

the Holder of such Global Security for all purposes under the Indenture and the

Securities, and owners of beneficial interests in a Global Security shall hold

such interests pursuant to the Depositary’s customary procedures.  Accordingly, any such owner’s beneficial

interest in a Global Security will be shown only on, and the transfer of such

interest shall be effected only through, records maintained by the Depositary

or its nominee or its Agent Members.

 

Section 306.  Registration,

Registration of Transfer and Exchange.

 

The Company shall cause to be kept at the Corporate

Trust Office of the Trustee, or such other office as the Trustee may designate,

a register (the register maintained in such office and in any other office or

agency designated pursuant to Section 1002 being herein sometimes referred to

as the “Security Register”) in which, subject to such reasonable regulations as

the Security Registrar may prescribe, the Company shall provide for the

registration of Securities and of transfers of Securities.  The Trustee or an

 

67

 

agent thereof or of the Company shall initially be the “Security

Registrar” for the purpose of registering Securities and transfers of

Securities as herein provided.

 

Upon surrender for registration of transfer of any Security

at the office or agency of the Company designated pursuant to Section 1002, 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.

 

Furthermore, any Holder of a Global Security shall, by

acceptance of such Global Security, agree that transfers of beneficial interest

in such Global Security may be effected only through a book-entry system

maintained by the Holder of such Global Security (or its agent), and that

ownership of a beneficial interest in the Securities shall be required to be

reflected in a book entry.

 

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 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 of the same series which

the Holder making the exchange is entitled to receive; provided that no exchange of

Series A Securities for Series B Securities shall occur until an Exchange Offer

Registration Statement shall have been declared effective by the Commission and

that the Series A Securities exchanged for the Series B Securities shall be

cancelled.

 

All Securities issued upon any registration of

transfer or exchange of Securities shall be the valid obligations of the

Company, evidencing the same Indebtedness, and entitled to the same benefits

under this Indenture, as the Securities surrendered upon such registration of

transfer or exchange.

 

Every Security presented or surrendered for

registration of transfer, or for exchange or redemption shall (if so required

by the Company or the Trustee) be duly endorsed, or be accompanied by a written

instrument of transfer in form satisfactory to the Company and the Security

Registrar, duly executed by the Holder thereof or his attorney duly authorized

in writing.

 

No service charge shall be made to a Holder for any

registration of transfer or exchange or redemption of Securities, but the

Company may require payment of a sum sufficient to pay all documentary, stamp

or similar issue or transfer taxes or other governmental charges that may be

imposed in connection with any registration of transfer or exchange of

Securities, other than exchanges pursuant to Section 303, 304, 305, 306, 307,

308, 906, 1013, 1016 or 1108 not involving any transfer.

 

68

 

The Company shall not be required (a) to issue,

register the transfer of or exchange any Security during a period beginning at

the opening of business (i) 15 days before the date of selection of

Securities for redemption under Section 1104 and ending at the close of

business on the day of such selection or (ii) 15 days before an Interest

Payment Date and ending on the close of business on the Interest Payment Date,

or (b) to register the transfer of or exchange any Security so selected

for redemption in whole or in part, except the unredeemed portion of Securities

being redeemed in part.

 

Every Restricted Security shall be subject to the

restrictions on transfer provided in the legend required to be set forth on the

face of each Restricted Security pursuant to Section 202(a), and the

restrictions set forth in this Section 306, and the Holder of each Restricted

Security, by such Holder’s acceptance thereof (or interest therein), agrees to

be bound by such restrictions on transfer.

 

The restrictions imposed by this Section 306 upon the

transferability of any particular Restricted Security shall cease and terminate

on (a) the later of two years from their date of issuance or two years after

the last date on which the Company or any Affiliate of the Company was the

owner of such Restricted Security (or any predecessor of such Restricted

Security) or (b) (if earlier) if and when such Restricted Security has been

sold pursuant to an effective registration statement under the Securities Act

or transferred  pursuant to Rule 144 or

under the Securities Act (or any successor provision), unless the Holder

thereof is an affiliate of the Company within the meaning of Rule 144 (or such

successor provisions).  Any Restricted

Security as to which such restrictions on transfer shall have expired in

accordance with their terms or shall have terminated may, upon surrender of

such Restricted Security for exchange to the Security Registrar in accordance

with the provision of this Section 306 (accompanied, in the event that such

restrictions on transfer have terminated pursuant to Rule 144 (or any successor

provision), by an Opinion of Counsel satisfactory to the Company and the

Trustee, to the effect that the transfer of such Restricted Security has been

made in compliance with Rule 144 (or any such successor provision)), be

exchanged for a new Security, of like tenor and aggregate principal amount,

which shall not bear the Restricted Securities Legend.  The Company shall inform the Trustee of the

effective date of any Registration Statement registering the Securities under

the Securities Act no later than two Business Days after such effective date.

 

Except as provided in the preceding paragraph, any

Security authenticated and delivered upon registration of transfer of, or in

exchange for, or in lieu of, any Global Security, whether pursuant to this

Section, Section 304, 308, 906 or 1108 or otherwise, shall also be a Global Security

and bear the legend specified in Section 202(a).

 

69

 

Section 307.  Special Transfer Provisions.

 

Unless and until (i) a Security is sold under an

effective Registration Statement, or (ii) a Security is exchanged for a

Series B Security in connection with the Exchange Offer, in each case pursuant

to the Registration Rights Agreement, the following provisions shall apply

(except to the extent inconsistent with the Applicable Procedures):

 

(a)           Transfers

and Exchanges Between Rule 144A Global Securities and Regulation S Global

Securities.

 

(i)  Rule 144A Global Security to

Regulation S Global Security. 

If the owner of a beneficial interest in the Rule 144A Global Security

wishes at any time to transfer such interest to a Person who wishes to acquire

the same in the form of a beneficial interest in the Regulation S Global

Security, such transfer may be effected only in accordance with the provisions

of this paragraph and the Applicable Procedures.  Upon receipt by the Trustee, as Security Registrar, of

(a) an order given by the Depositary or its authorized representative

directing that a beneficial interest in the Regulation S Global Security

in a specified principal amount be credited to a specified Agent Member’s

account and that a beneficial interest in the Rule 144A Global Security in an

equal principal amount be debited from another specified Agent Member’s account

and (b) a Regulation S Certificate in the form of Exhibit A hereto,

satisfactory to the Trustee and duly executed by the owner of such beneficial

interest in the Rule 144A Global Security or his attorney duly authorized in

writing, then the Trustee, as Security Registrar but subject to paragraph (iv)

below, shall reduce the principal amount of the Rule 144A Global Security and

increase the principal amount of the Regulation S Global Security by such

specified principal amount.

 

(ii)           Regulation S Global Security

to Rule 144A Global Security.  If

the owner of a beneficial interest in the Regulation S Global Security

wishes at any time to transfer such interest to a Person who wishes to acquire

the same in the form of a beneficial interest in the Rule 144A Global Security,

such transfer may be effected only in accordance with this paragraph (ii) and

subject to the Applicable Procedures. 

Upon receipt by the Trustee, as Security Registrar, of (a) an order

given by the Depositary or its authorized representative directing that a

beneficial interest in the Rule 144A Global Security in a specified principal

amount be credited to a specified Agent Member’s account and that a beneficial

interest in the Regulation S Global Security in an equal principal amount

be debited from

 

70

 

another specified Agent Member’s account and (b) if such transfer

is to occur during the Restricted Period, a Restricted Securities Certificate

in the form of Exhibit B hereto, satisfactory to the Trustee and duly executed

by the owner of such beneficial interest in the Regulation S Global

Security or his attorney duly authorized in writing, then the Trustee, as

Security Registrar, shall reduce the principal amount of the Regulation S

Global Security and increase the principal amount of the Rule 144A Global

Security by such specified principal amount.

 

(iii)          Exchanges between Global Securities

and Non-Global Securities.  A

beneficial interest in a Global Security may be exchanged for a Security that

is not a Global Security as provided in Section 305(b), provided that,

if such interest is a beneficial interest in the Rule 144A Global Security, or

if such interest is a beneficial interest in the Regulation S Global

Security and such exchange is to occur during the Restricted Period, then such

interest shall bear the Private Placement Legend (subject in each case to

Section 307(b).

 

(iv)          Regulation S Global Security

to be Held Through Euroclear or Clearstream during Restricted Period.  The Company shall use its best efforts to

cause the Depositary to ensure that, until the expiration of the Restricted

Period, beneficial interests in the Regulation S Global Security may be

held only in or through accounts maintained at the Depositary by Euroclear or

Clearstream (or by Agent Members acting for the account thereof), and no person

shall be entitled to effect any transfer or exchange that would result in any

such interest being held otherwise than in or through such an account; provided

that this paragraph (iv) shall not prohibit any transfer or exchange of such an

interest in accordance with paragraph (ii) above.

 

(b)           Restricted

Securities Legend.  Rule 144A Global

Securities and their Successor Securities, Regulation S Global Securities

and their Successor Securities and Physical Securities and their Successor

Securities shall bear a Restricted Securities Legend, subject to the following:

 

(i)            subject to the following clauses of

this Section 307(b), a Security or any portion thereof which is exchanged,

upon transfer or otherwise, for a Global Security or any portion thereof shall

bear the Restricted Securities Legend borne by such Global Security while

represented thereby;

 

(ii)           subject to the following Clauses of

this Section 307(b), a new Security which is not a Global Security and is

issued in exchange for

 

71

 

another Security (including a Global Security) or any portion thereof,

upon transfer or otherwise, shall bear the Restricted Securities Legend borne

by such other Security;

 

(iii)          Securities received pursuant to the

Exchange Offer, and all other Securities sold or otherwise disposed of pursuant

to an effective registration statement under the Securities Act, together with

their respective Successor Securities, shall not bear a Restricted Securities

Legend;

 

(iv)          at any time after the Securities may

be freely transferred without registration under the Securities Act or without

being subject to transfer restrictions pursuant to the Securities Act, a new

Security which does not bear a Restricted Securities Legend may be issued in

exchange for or in lieu of a Security (other than a Global Security) or any

portion thereof which bears such a legend if the Trustee has received an

Unrestricted Securities Certificate substantially in the form of Exhibit C

hereto, satisfactory to the Trustee and duly executed by the Holder of such

legended Security or his attorney duly authorized in writing, and after such

date and receipt of such certificate, the Trustee shall authenticate and

deliver such a new Security in exchange for or in lieu of such other Security as

provided in this Article Three;

 

(v)           a new Security which does not bear a

Restricted Securities Legend may be issued in exchange for or in lieu of a

Security (other than a Global Security) or any portion thereof which bears such

a legend if, in the Company’s judgment, placing such a legend upon such new

Security is not necessary to ensure compliance with the registration

requirements of the Securities Act, and the Trustee, at the direction of the

Company, shall authenticate and deliver such a new Security as provided in this

Article Three.

 

(c)           General.  By its acceptance of any Security bearing

the Restricted Securities Legend, each Holder of such a Security acknowledges

the restrictions on transfer of such Security set forth in this Indenture and

in the Restricted Securities Legend and agrees that it will transfer such

Security only as provided in this Indenture.

 

The Security Registrar shall retain copies of all

letters, notices and other written communications received pursuant to

Section 306 or this Section 307. 

The Company shall have the right to inspect and make copies of all such

letters, notices or other written communications at any reasonable time upon

the giving of reasonable written notice to the Security Registrar.

 

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Section 308.  Mutilated, Destroyed, Lost and Stolen

Securities.

 

If (a) any mutilated Security is surrendered to

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, each Guarantor and the Trustee, such security or

indemnity, in each case, as may be required by them to save each of them

harmless, then, in the absence of notice to the Company, any Guarantor 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 replacement 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, the Company in its

discretion may, instead of issuing a replacement Security, pay such Security.

 

Upon the issuance of any replacement Securities under

this Section, the Company may require the payment of a sum sufficient to pay

all documentary, stamp or similar issue or transfer taxes or other governmental

charges that may be imposed in relation thereto and any other expenses

(including the fees and expenses of the Trustee) connected therewith.

 

Every replacement Security issued pursuant to this

Section in lieu of any destroyed, lost or stolen Security shall constitute an

original additional contractual obligation of the Company and the Guarantors,

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 309.  Payment of Interest; Interest Rights

Preserved.

 

Interest on any Security which is payable, and is

punctually paid or duly provided for, on any Interest Payment Date shall be

paid to the Person in whose name that Security is registered at the close of

business on the Regular Record Date for such interest.

 

Any interest on any Security which is payable, but is

not punctually paid or duly provided for, on any Interest Payment Date and

interest on such defaulted interest at

 

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the then applicable interest rate borne by the Securities, to the

extent lawful (such defaulted interest and interest thereon herein collectively

called “Defaulted Interest”) shall forthwith cease to be payable to the Holder

on the Regular Record Date; and such Defaulted Interest may be paid by the

Company, at its election in each case, as provided in Subsection (a) or (b)

below:

 

(a)           The Company may elect to make payment

of any Defaulted Interest to the Persons in whose names the Securities are

registered at the close of business on a Special Record Date for the payment of

such Defaulted Interest, which shall be fixed in the following manner.  The Company shall notify the Trustee in

writing of the amount of Defaulted Interest proposed to be paid on each

Security and the date (not less than 30 days after such notice) of the proposed

payment, and at the same time the Company shall deposit with the Trustee an

amount of money equal to the aggregate amount proposed to be paid in respect of

such Defaulted Interest or shall make arrangements satisfactory to the Trustee

for such deposit prior to the date of the proposed payment, such money when

deposited to be held in trust for the benefit of the Persons entitled to such

Defaulted Interest as in this Subsection provided.  Thereupon the Trustee shall fix a Special Record Date for the

payment of such Defaulted Interest which shall be not more than 15 days and not

less than 10 days prior to the date of the proposed payment and not less than

10 days after the receipt by the Trustee of the notice of the proposed

payment.  The Trustee shall promptly

notify the Company in writing of such Special Record Date.  In the name and at the expense of the

Company, the Trustee shall cause notice of the proposed payment of such

Defaulted Interest and the Special Record Date therefor to be mailed,

first-class postage prepaid, to each Holder at his address as it appears in the

Security Register, not less than 10 days prior to such Special Record

Date.  Notice of the proposed payment of

such Defaulted Interest and the Special Record Date therefor having been so

mailed, such Defaulted Interest shall be paid to the Persons in whose names the

Securities are registered on such Special Record Date and shall no longer be

payable pursuant to the following Subsection (b).

 

(b)           The Company may make payment of any

Defaulted Interest in any other lawful manner not inconsistent with the

requirements of any securities exchange on which the Securities may be listed,

and upon such notice as may be required by such exchange, if, after written

notice given by the Company to the Trustee of the proposed payment pursuant to

this Subsection, such payment shall be deemed practicable by the Trustee.

 

Subject to the foregoing provisions of this Section,

each Security delivered under this Indenture upon registration of transfer of

or in exchange for or in lieu of any

 

74

 

other Security shall carry the rights to interest accrued and unpaid,

and to accrue, which were carried by such other Security.

 

Section 310.  Persons Deemed Owners.

 

The Company, any Guarantor, the Trustee and any agent

of the Company, any Guarantor or the Trustee may treat the Person in whose name

any Security is registered as the owner of such Security for the purpose of

receiving payment of principal of, premium, if any, and (subject to Section

309) interest on such Security and for all other purposes whatsoever, whether

or not such Security is overdue, and neither the Company, any Guarantor, the

Trustee nor any agent of the Company, any Guarantor or the Trustee shall be

affected by notice to the contrary.  No

holder of any beneficial interest in any Global Security held on its behalf by

a Depositary shall have any rights under this Indenture with respect to such

Global Security, and such Depositary may be treated by the Company, any

Guarantor, the Trustee and any agent of the Company, any Guarantor or the

Trustee as the owner of such Global Security for all purposes whatsoever.  Notwithstanding the foregoing, nothing

herein shall prevent the Company, any Guarantor, the Trustee or any agent of

the Company, any Guarantor or the Trustee from giving effect to any written

certification, proxy or other authorization furnished by the Depositary or

impair, as between the Depositary and such holders of beneficial interests, the

operation of customary practices governing the exercise of the rights of the Depositary

(or its nominee) as Holder of any Security.

 

Section 311.  Cancellation.

 

All Securities surrendered for payment, purchase,

redemption, registration of transfer or exchange shall be delivered to the

Trustee and, if not already cancelled, shall be promptly cancelled by it.  The Company and any Guarantor may at any

time deliver to the Trustee for cancellation any Securities previously

authenticated and delivered hereunder which the Company or such Guarantor may

have acquired in any manner whatsoever, and all Securities so delivered shall

be promptly cancelled by the Trustee. 

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 destroyed and certification of their

destruction delivered to the Company unless by a Company Order the Company

shall direct that the cancelled Securities be returned to it.  The Trustee shall provide the Company a list

of all Securities that have been cancelled from time to time as requested by

the Company.

 

Section 312.  Computation of Interest.

 

Interest on the Securities shall be computed on the

basis of a 360-day year of twelve 30-day months.

 

75

 

Section 313.  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.

 

ARTICLE FOUR

 

DEFEASANCE AND COVENANT

DEFEASANCE

 

Section 401.  Company’s

Option to Effect Defeasance or Covenant Defeasance.

 

The Company may, at its option by Board Resolution, at

any time, with respect to the Securities, elect to have either Section 402 or

Section 403 be applied to all of the Outstanding Securities (the “Defeased

Securities”), upon compliance with the conditions set forth below in this

Article Four.

 

Section 402.  Defeasance and Discharge.

 

Upon the Company’s exercise under Section 401 of the

option applicable to this Section 402, the Company, each of the Guarantors and

any other obligor upon the Securities, if any, shall be deemed to have been

discharged from its obligations with respect to the Defeased Securities on the

date the conditions set forth below are satisfied (hereinafter,

“defeasance”).  For this purpose, such

defeasance means that the Company, each of the Guarantors, if any, and any

other obligor under the Indenture shall be deemed to have paid and discharged

the entire Indebtedness represented by the Defeased Securities, which shall

thereafter be deemed to be “Outstanding” only for the purposes of Section 405

and the other Sections of this Indenture referred to in (a) and (b) below, and

to have satisfied all its other obligations under such Securities and this

Indenture insofar as such Securities are concerned (and the Trustee, at the

expense of the Company, and, upon written request, shall execute proper

instruments acknowledging the same), except for the following which shall

survive until otherwise terminated or discharged hereunder:  (a) the rights of Holders of Defeased

Securities to receive, solely from the trust fund described in Section 404 and

as more fully set forth in such Section, payments in respect of the principal

of, premium, if any, and interest on such Securities when such payments are

due, (b) the Company’s obligations with respect to such Defeased

Securities under Sections 304, 305, 306, 307, 1002 and 1003, (c) the

rights, powers, trusts, duties and

 

76

 

immunities of the Trustee hereunder, including, without limitation, the

Trustee’s rights under Section 606, and (d) this Article Four.  Subject to compliance with this Article

Four, the Company may exercise its option under this Section 402

notwithstanding the prior exercise of its option under Section 403 with respect

to the Securities.

 

Section 403.  Covenant Defeasance.

 

Upon the Company’s exercise under Section 401 of the

option applicable to this Section 403, the Company and each Guarantor shall be

released from its obligations under any covenant or provision contained or referred

to in Sections 1006 through 1019, inclusive, and the provisions of Article

Twelve and Sections 1416 through 1429 shall not apply, with respect to the

Defeased Securities on and after the date the conditions set forth below are

satisfied (hereinafter, “covenant defeasance”), and the Defeased Securities

shall thereafter be deemed to be not “Outstanding” for the purposes of any

direction, waiver, consent or declaration or Act of Holders (and the

consequences of any thereof) in connection with such covenants and the

provisions of Article Twelve and Sections 1416 through 1429, but shall continue

to be deemed “Outstanding” for all other purposes hereunder.  For this purpose, such covenant defeasance

means that, with respect to the Defeased Securities, the Company and each

Guarantor may omit to comply with and shall have no liability in respect of any

term, condition or limitation set forth in any such Section or Article, whether

directly or indirectly, by reason of any reference elsewhere herein to any such

Section or Article or by reason of any reference in any such Section or Article

to any other provision herein or in any other document and such omission to

comply shall not constitute a Default or an Event of Default under Section

501(c), (d) or (g), but, except as specified above, the remainder of this

Indenture and such Defeased Securities shall be unaffected thereby.

 

Section 404.  Conditions to Defeasance or Covenant

Defeasance.

 

The following shall be the conditions to application

of either Section 402 or Section 403 to the Defeased Securities:

 

(1)           The

Company shall irrevocably have deposited or caused to be deposited with the

Trustee (or another trustee satisfying the requirements of Section 608 who

shall agree to comply with the provisions of this Article Four applicable to

it) as trust funds in trust for the purpose of making the following payments,

specifically pledged as security for, and dedicated solely to, the benefit of

the Holders of such Securities, (a) United States dollars in an amount, or

(b) U.S. Government Obligations which through the scheduled payment of

principal and interest in respect thereof in accordance with their terms will

provide, not later than one day before the due date of any payment, money in an

amount, or (c) a combination thereof, sufficient, in the opinion of a

nationally recognized firm of independent public accountants or a nationally

recognized investment banking firm expressed in a written certification thereof

delivered to the

 

77

 

Trustee, to pay and discharge and which shall be applied by the Trustee

(or other qualifying trustee) to pay and discharge the principal of, premium,

if any, and interest on the Defeased Securities on the Stated Maturity of such

principal or installment of principal or interest (or on any date after March

15, 2007 (such date being referred to as the “Defeasance Redemption Date”), if

when exercising under Section 401 either its option applicable to Section 402

or its option applicable to Section 403, the Company shall have delivered to

the Trustee an irrevocable notice to redeem all of the Outstanding Securities

on the Defeasance Redemption Date); provided that the Trustee shall have

been irrevocably instructed to apply such United States dollars or the proceeds

of such U.S. Government Obligations to said payments with respect to the

Securities; and provided, further, that the United States dollars

or U.S. Government Obligations deposited shall not be subject to the rights of

the holders of Senior Indebtedness or Guarantor Senior Indebtedness pursuant to

the provisions of Articles Twelve and Fourteen.  For this purpose, “U.S. Government Obligations” means securities

that are (i) direct obligations of the United States of America for the

timely payment of which its full faith and credit is pledged or

(ii) obligations of a Person controlled or supervised by and acting as an

agency or instrumentality of the United States of America the timely payment of

which is unconditionally guaranteed as a full faith and credit obligation by

the United States of America, which, in either case, are not callable or

redeemable at the option of the issuer thereof, and shall also include a

depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities

Act), as custodian with respect to any such U.S. Government Obligation or a

specific payment of principal of or interest on any such U.S. Government

Obligation held by such custodian for the account of the holder of such

depository receipt, provided that (except as required by law) such

custodian is not authorized to make any deduction from the amount payable to

the holder of such depository receipt from any amount received by the custodian

in respect of the U.S. Government Obligation or the specific payment of

principal of or interest on the U.S. Government Obligation evidenced by such

depository receipt.

 

(2)           In

the case of an election under Section 402, the Company shall have delivered to

the Trustee an Opinion of Independent Counsel in the United States stating that

(A) the Company has received from, or there has been published by, the

Internal Revenue Service a ruling or (B) since the date of this Indenture,

there has been a change in the applicable federal income tax law, in either case

to the effect that, and based thereon such Opinion of Independent Counsel in

the United States shall confirm that, the holders of the Outstanding Securities

will not recognize income, gain or loss for federal income tax purposes as a

result of such defeasance and will be subject to federal income tax on the same

amounts, in the same manner and at the same times as would have been the case

if such defeasance had not occurred.

 

(3)           In

the case of an election under Section 403, the Company shall have delivered to

the Trustee an Opinion of Independent Counsel in the United States to the

 

78

 

effect that the holders of the Outstanding Securities will not

recognize income, gain or loss for federal income tax purposes as a result of

such covenant defeasance and will be subject to federal income tax on the same

amounts, in the same manner and at the same times as would have been the case

if such covenant defeasance had not occurred.

 

(4)           No

Default or Event of Default shall have occurred and be continuing on the date

of such deposit or insofar as subsections 501(h) and (i) are concerned, at

any time during the period ending on the 91st day after the date of deposit.

 

(5)           Such

defeasance or covenant defeasance shall not cause the Trustee for the

Securities to have a conflicting interest with respect to any securities of the

Company or any Guarantor.

 

(6)           Such

defeasance or covenant defeasance shall not result in a breach or violation of,

or constitute a Default under, this Indenture or any other material agreement

or instrument to which the Company or any Guarantor is a party or by which it

is bound.

 

(7)           The

Company shall have delivered to the Trustee an Opinion of Independent Counsel

to the effect that (A) the trust funds will not be subject to any rights

of holders of Senior Indebtedness or Guarantor Senior Indebtedness, including,

without limitation, those arising under this Indenture and (B) after the

91st day following the deposit, the trust funds will not be subject to the

effect of any applicable bankruptcy, insolvency, reorganization or similar laws

affecting creditors’ rights generally.

 

(8)           The

Company shall have delivered to the Trustee an Officers’ Certificate stating

that the deposit was not made by the Company with the intent of preferring the

holders of the Securities or any Guarantee over the other creditors of the

Company or any Guarantor with the intent of defeating, hindering, delaying or

defrauding creditors of the Company, any Guarantor or others.

 

(9)           No

event or condition shall exist that would prevent the Company from making

payments of the principal of, premium, if any, and interest on the Securities

on the date of such deposit or at any time ending on the 91st day after

the date of such deposit.

 

(10)         The

Company shall have delivered to the Trustee an Officers’ Certificate and an

Opinion of Independent Counsel, each stating that all conditions precedent

provided for relating to either the defeasance under Section 402 or the

covenant defeasance under Section 403 (as the case may be) have been complied

with as contemplated by this Section 404.

 

79

 

Opinions of

Counsel or Opinions of Independent Counsel required to be delivered under this

Section may have qualifications customary for opinions of the type required and

counsel delivering such opinions may rely on certificates of the Company or

government or other officials customary for opinions of the type required,

including certificates certifying as to matters of fact, including that various

financial covenants have been complied with.

 

Section 405.  Deposited

Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous

Provisions.

 

Subject to the provisions of the last paragraph of

Section 1003, all United States dollars and U.S. Government Obligations

(including the proceeds thereof) deposited with the Trustee or other qualifying

trustee as permitted under Section 404 (collectively, for purposes of this

Section 405, the “Trustee”) pursuant to Section 404 in respect of the Defeased

Securities shall be held in trust and applied by the Trustee, in accordance

with the provisions of such Securities and this Indenture, to the payment,

either directly or through any Paying Agent (including the Company acting as

its own Paying Agent) as the Trustee may determine, to the Holders of such

Securities of all sums due and to become due thereon in respect of principal,

premium, if any, and interest, but such money need not be segregated from other

funds except to the extent required by law.

 

The Company shall pay and indemnify the Trustee

against any tax, fee or other charge imposed on or assessed against the U.S.

Government Obligations deposited pursuant to Section 404 or the principal and

interest received in respect thereof other than any such tax, fee or other

charge which by law is for the account of the Holders of the Defeased

Securities.

 

Anything in this Article Four to the contrary

notwithstanding, the Trustee shall deliver or pay to the Company from time to

time upon Company Request any United States dollars or U.S. Government

Obligations held by it as provided in Section 404 which, in the opinion of a

nationally recognized firm of independent public accountants expressed in a

written certification thereof delivered to the Trustee, are in excess of the

amount thereof which would then be required to be deposited to effect

defeasance or covenant defeasance.

 

Section 406.  Reinstatement.

 

If the Trustee or Paying Agent is unable to apply any

United States dollars or U.S. Government Obligations in accordance with Section

402 or 403, as the case may be, by reason of any order or judgment of any court

or governmental authority enjoining, restraining or otherwise prohibiting such

application, then the Company’s and each Guarantor’s obligations under this

Indenture and the Securities and the provisions of Articles Twelve and Fourteen

hereof shall be revived and reinstated as though no deposit

 

80

 

had occurred pursuant to Section 402 or 403, as the case may be, until

such time as the Trustee or Paying Agent is permitted to apply all such United

States dollars or U.S. Government Obligations in accordance with Section 402 or

403, as the case may be; provided, however, that if the Company

makes any payment to the Trustee or Paying Agent of principal of, premium, if

any, or interest on any Security following the reinstatement of its

obligations, the Trustee or Paying Agent shall promptly pay any such amount to

the Holders of the Securities and the Company shall be subrogated to the rights

of the Holders of such Securities to receive such payment from the money held

by the Trustee or Paying Agent.

 

ARTICLE FIVE

 

REMEDIES

 

Section 501.  Events of Default.

 

“Event of Default”, wherever used herein, means any

one of the following events which has occurred and is continuing (whatever the

reason for such Event of Default and whether it shall be occasioned by the

provisions of Article Twelve or be voluntary or involuntary or be effected by

operation of law or pursuant to any judgment, decree or order of any court or

any order, rule or regulation of any administrative or governmental body):

 

(a)           there

shall be a default in the payment of any interest on any Security (including

any Penalty Interest) when it becomes due and payable, and such default shall

continue for a period of 30 days;

 

(b)           there

shall be a default in the payment of the principal of (or premium, if any, on)

any Security at its Maturity (upon acceleration, optional or mandatory

redemption, required repurchase or otherwise);

 

(c)           (i) there

shall be a default in the performance, or breach, of any covenant or agreement

of the Company or any Guarantor under this Indenture (other than a default in

the performance or breach of a covenant or agreement which is specifically

dealt with in clause (a) or (b) or in clause (ii), (iii) or (iv) of this clause

(c)) and such default or breach shall continue for a period of 30 days after

written notice has been given, by certified mail, (1) to the Company by

the Trustee or (z) to the Company and the Trustee by the Holders of at

least 25% in aggregate principal amount of the Outstanding Securities;

(ii) there shall be a default in the performance or breach of the

provisions of Article Eight; (iii) the Company shall have failed to make

or consummate an Offer in accordance with the provisions of Section 1013; or

(iv) the Company shall have failed to

 

81

 

make or consummate a Change of Control Offer in accordance with the

provisions of Section 1016;

 

(d)           one

or more defaults shall have occurred under any agreements, indentures or

instruments under which the Company, any Guarantor or any Restricted Subsidiary

then has outstanding Indebtedness in excess of $5,000,000 in the aggregate and,

if not already matured at its final maturity in accordance with its terms, such

Indebtedness shall have been accelerated;

 

(e)           any

Guarantee shall for any reason cease to be, or be asserted in writing by any

Guarantor or the Company not to be, in full force and effect, and enforceable

in accordance with its terms, except to the extent contemplated by this

Indenture and any such Guarantee;

 

(f)            one

or more judgments, orders or decrees for the payment of money in excess of

$5,000,000 either individually or in the aggregate (net of amounts covered by

insurance, bond, surety or similar instrument), shall be entered against the

Company, any Guarantor, or any Restricted Subsidiary or any of their respective

properties and shall not be discharged and either (a) any creditor shall

have commenced an enforcement proceeding upon such judgment, order or decree or

(b) there shall have been a period of 60 consecutive days during which a

stay of enforcement of such judgment or order, by reason of an appeal or

otherwise, shall not be in effect;

 

(g)           any

holder or holders of at least $5,000,000 in aggregate principal amount of

Indebtedness of the Company, any Guarantor, or any Restricted Subsidiary after

a default under such Indebtedness shall notify the Trustee of the intended sale

or disposition of any assets of the Company, any Guarantor or any Restricted

Subsidiary that have been pledged to or for the benefit of such holder or

holders to secure such Indebtedness or shall commence proceedings, or take any

action (including by way of set-off), to retain in satisfaction of such

Indebtedness or to collect on, seize, dispose of or apply in satisfaction of

Indebtedness, assets of the Company or any Restricted Subsidiary (including

funds on deposit or held pursuant to lock-box and other similar arrangements);

 

(h)           there

shall have been the entry by a court of competent jurisdiction of (i) a

decree or order for relief in respect of the Company, any Guarantor or any

Restricted Subsidiary in an involuntary case or proceeding under any applicable

Bankruptcy Law or (ii) a decree or order adjudging the Company, any

Guarantor or any Restricted Subsidiary bankrupt or insolvent, or seeking

reorganization, arrangement, adjustment or composition of or in respect of the

Company, any Guarantor or any Restricted Subsidiary under any applicable

federal or state law, or appointing a custodian, receiver, liquidator,

assignee, trustee, sequestrator (or other similar official) of the Company, any

Guarantor or any Restricted Subsidiary or of any substantial part of their

respective properties, or ordering the winding up or liquidation of their

affairs, and any

 

82

 

such decree or order for relief shall continue to be in effect, or any

such other decree or order shall be unstayed and in effect, for a period of 60

consecutive days; or

 

(i)            (i) the

Company, any Guarantor or any Restricted Subsidiary commences a voluntary case

or proceeding under any applicable Bankruptcy Law or any other case or

proceeding to be adjudicated bankrupt or insolvent, (ii) the Company, any

Guarantor or any Restricted Subsidiary consents to the entry of a decree or

order for relief in respect of the Company, any Guarantor or such Restricted

Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy

Law or to the commencement of any bankruptcy or insolvency case or proceeding

against it, (iii) the Company, any Guarantor or any Restricted Subsidiary

files a petition or answer or consent seeking reorganization or relief under

any applicable federal or state law, (iv) the Company, any Guarantor or

any Restricted Subsidiary (1) consents to the filing of such petition or

the appointment of, or taking possession by, a custodian, receiver, liquidator,

assignee, trustee, sequestrator or other similar official of the Company, any

Guarantor or such Restricted Subsidiary or of any substantial part of its

respective properties, (2) makes an assignment for the benefit of

creditors or (3) admits in writing its inability to pay its debts

generally as they become due, or (v) the Company, any Guarantor or any

Restricted Subsidiary takes any corporate action authorizing any such actions

in this paragraph (i).

 

The Company shall deliver to the Trustee within five

days after the occurrence thereof, written notice, in the form of an Officers’

Certificate, of any Default, its status and what action the Company is taking

or proposes to take with respect thereto. 

Unless the Corporate Trust Office of the Trustee has received written

notice of an Event of Default of the nature described in this Section, the

Trustee shall not be deemed to have knowledge of such Event of Default for the

purposes of Article Five or for any other purpose.

 

Section 502.  Acceleration of Maturity; Rescission and

Annulment.

 

If an Event of Default (other than an Event of Default

specified in Sections 501(h) and (i)), shall occur and be continuing, the

Trustee or the Holders of not less than 25% in aggregate principal amount of

the Securities Outstanding may, and the Trustee at the request of the Holders

of not less than 25% in aggregate principal amount of the Securities

Outstanding shall, declare all unpaid principal of, premium, if any, and

accrued interest on all the Securities to be due and payable immediately, by a

notice in writing to the Company (and to the Trustee if given by the Holders of

the Securities); provided that so long as the Bank Credit Agreement is

in effect, such declaration shall not become effective until the earlier of (a)

five Business Days after receipt of such notice of acceleration from the

Holders or the Trustee by the agent under the Bank Credit Agreement or (b)

acceleration of the Indebtedness under the Bank Credit Agreement.  Thereupon the Trustee may, at its

discretion, proceed to protect and enforce the rights of the Holders of the

Securities by appropriate judicial proceeding. 

If an Event of Default

 

83

 

specified in clause (h) or (i) of Section 501 occurs and is continuing,

then all the Securities shall ipso  facto become and be

immediately due and payable, in an amount equal to the principal amount of the

Securities, together with accrued and unpaid interest, if any, to the date the

Securities become due and payable, without any declaration or other act on the

part of the Trustee or any Holder.  The

Trustee or, if notice of acceleration is given by the Holders, the Holders

shall give notice to the agent under the Bank Credit Agreement of any such

acceleration.

 

At any time after such declaration of acceleration has

been made but before a judgment or decree for payment of the money due has been

obtained by the Trustee as hereinafter in this Article provided, the Holders of

a majority in aggregate principal amount of the Securities Outstanding, by

written notice to the Company and the Trustee, may rescind and annul such

declaration and its consequences if:

 

(a)           the

Company has paid or deposited with the Trustee a sum sufficient to pay

 

(i)      all sums paid or advanced by the Trustee

under this Indenture and the reasonable compensation, expenses, disbursements

and advances of the Trustee, its agents and counsel,

 

(ii)     all overdue interest on all Securities,

 

(iii)    the principal of and premium, if any, on any

Securities which have become due otherwise than by such declaration of

acceleration and interest thereon at a rate borne by the Securities, and

 

(iv)    to the extent that payment of such interest

is lawful, interest upon overdue interest at the rate borne by the Securities;

and

 

(b)           all

Events of Default, other than the non-payment of principal of the Securities

which have become due solely by such declaration of acceleration, have been

cured or waived as provided in Section 513.

 

No such rescission shall affect any subsequent Default or impair any

right consequent thereon provided in Section 513.

 

Section 503.  Collection

of Indebtedness and Suits for Enforcement by Trustee.

 

The Company and each Guarantor covenant that if

 

84

 

(a)          default is made in the payment of any

interest on any Security when such interest becomes due and payable and such

default continues for a period of 30 days, or

 

(b)           default is made in the payment of the

principal of or premium, if any, on any Security at the Stated Maturity

thereof,

 

the Company and any such Guarantor will, upon demand of the Trustee,

pay to it, for the benefit of the Holders of such Securities, subject to

Articles Twelve and Fourteen, the whole amount then due and payable on such

Securities for principal and premium, if any, and interest, with interest upon

the overdue principal and premium, if any, and, to the extent that payment of

such interest shall be legally enforceable, upon overdue installments of

interest, at the rate borne by the Securities; and, in addition thereto, such

further amount as shall be sufficient to cover the costs and expenses of

collection, including the reasonable compensation, expenses, disbursements and

advances of the Trustee, its agents and counsel.

 

If the Company or any Guarantor, as the case may be,

fails to pay such amounts forthwith upon such demand, the Trustee, in its own

name and as trustee of an express trust, may institute a judicial proceeding

for the collection of the sums so due and unpaid and may prosecute such

proceeding to judgment or final decree, and may enforce the same against the

Company or any Guarantor or any other obligor upon the Securities and collect

the moneys adjudged or decreed to be payable in the manner provided by law out

of the property of the Company or any Guarantor or any other obligor upon the

Securities, wherever situated.

 

If an Event of Default occurs and is continuing, the

Trustee may in its discretion proceed to protect and enforce its rights and the

rights of the Holders under this Indenture or the Guarantees by such

appropriate private or judicial proceedings as the Trustee shall deem most

effectual to protect and enforce such rights, including, seeking recourse

against any Guarantor pursuant to the terms of any Guarantee, whether for the

specific enforcement of any covenant or agreement in this Indenture or in aid

of the exercise of any power granted herein or therein, or to enforce any other

proper remedy, including, without limitation, seeking recourse against any

Guarantor pursuant to the terms of a Guarantee, or to enforce any other proper

remedy, subject however to Section 512.

 

Section 504.  Trustee May File Proofs of Claim.

 

In case of the pendency of any receivership,

insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,

composition or other judicial proceeding relative to the Company or any other

obligor, including each Guarantor, upon the Securities or the property of the

Company or of such other obligor or their creditors,

 

85

 

the Trustee (irrespective of whether the principal of the Securities

shall then be due and payable as therein expressed or by declaration or

otherwise and irrespective of whether the Trustee shall have made any demand on

the Company for the payment of overdue principal or interest) shall be entitled

and empowered, by intervention in such proceeding or otherwise,

 

(a)           to

file and prove a claim for the whole amount of principal, and premium, if any,

and interest owing and unpaid in respect of the Securities and to file such

other papers or documents as may be necessary 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)           subject

to Articles Twelve and Fourteen, to collect and receive any moneys, securities

or other property payable or deliverable upon any conversion or exchange of

Securities or upon any such claims and to distribute the same;

 

and any custodian, in any such judicial proceeding is hereby authorized

by each Holder to make such payments to the Trustee and, in the event that the

Trustee shall consent to the making of such payments directly to the Holders,

to pay 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 606.

 

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 505.  Trustee May Enforce Claims without

Possession of Securities.

 

All rights of action and claims under this Indenture

or the Securities may be prosecuted and enforced by the Trustee without the

possession of any of the Securities or the production thereof in any proceeding

relating thereto, and any such proceeding instituted by the Trustee shall be

brought in its own name and as trustee of an express trust, and any recovery of

judgment shall, after provision for the payment of the reasonable compensation,

expenses, disbursements and advances of the Trustee, its agents and counsel, be

for the ratable benefit of the Holders of the Securities in respect of which

such judgment has been recovered.

 

86

 

Section 506.  Application of Money Collected.

 

Any money collected by the Trustee pursuant to this

Article or otherwise on behalf of the Holders or the Trustee pursuant to this

Article or through any proceeding or any arrangement or restructuring in

anticipation or in lieu of any proceeding contemplated by this Article shall be

applied, subject to applicable law, in the following order, at the date or

dates fixed by the Trustee and, in case of the distribution of such money on

account of principal, premium, if any, or interest, upon presentation of the

Securities and the notation thereon of the payment if only partially paid and

upon surrender thereof if fully paid:

 

FIRST:  To the

payment of all amounts due the Trustee under Section 606;

 

SECOND: 

Subject to Articles Twelve and Fourteen, to the payment of the amounts

then due and unpaid upon the Securities for principal, premium, if any, and interest,

in respect of which or for the benefit of which such money has been collected,

ratably, without preference or priority of any kind, according to the amounts

due and payable on such Securities for principal, premium, if any, and

interest; and

 

THIRD:  Subject

to Articles Twelve and Fourteen, the balance, if any, to the Person or Persons

entitled thereto, including the Company, provided that all sums due and owing

to the Holders and the Trustee have been paid in full as required by this

Indenture.

 

Section 507.  Limitation on Suits.

 

No Holder of any Securities shall have any right to

institute any proceeding, judicial or otherwise, with respect to this

Indenture, or for the appointment of a receiver or trustee, or for any other

remedy hereunder, unless

 

(a)           such

Holder has previously given written notice to the Trustee of a continuing Event

of Default;

 

(b)           the

Holders of not less than 25% in principal amount of the Outstanding Securities

shall have made written request to the Trustee to institute proceedings in

respect of such Event of Default in its own name as trustee hereunder;

 

(c)           such

Holder or Holders have offered to the Trustee an indemnity satisfactory to the

Trustee against the costs, expenses and liabilities to be incurred in

compliance with such request;

 

(d)           the

Trustee for 60 days after its receipt of such notice, request and offer of

indemnity has failed to institute any such proceeding; and

 

87

 

(e)           no

direction inconsistent with such written request has been given to the Trustee

during such 60-day period by the Holders of a majority in principal amount of

the Outstanding Securities;

 

it being

understood and intended that no one or more Holders shall have any right in any

manner whatever by virtue of, or by availing of, any provision of this

Indenture or any Guarantee to affect, disturb or prejudice the rights of any

other Holders, or to obtain or to seek to obtain priority or preference over

any other Holders or to enforce any right under this Indenture, except in the

manner provided in this Indenture or any Guarantee and for the equal and

ratable benefit of all the Holders.

 

Section 508.  Unconditional

Right of Holders to Receive Principal, Premium and Interest.

 

Notwithstanding any other provision in this Indenture,

but subject to Articles Twelve and Fourteen, the Holder of any Security shall

have the right on the terms stated herein, which is absolute and unconditional,

to receive payment of the principal of, premium, if any, and (subject to

Section 309) interest on such Security on the respective Stated Maturities

expressed in such Security (or, in the case of redemption or repurchase, on the

Redemption Date or repurchase date) and to institute suit for the enforcement

of any such payment, and such rights shall not be impaired without the consent

of such Holder, subject to Articles Twelve and Fourteen.

 

Section 509.  Restoration of Rights and Remedies.

 

If the Trustee or any Holder has instituted any

proceeding to enforce any right or remedy under this Indenture or the

Guarantees and such proceeding has been discontinued or abandoned for any

reason, or has been determined adversely to the Trustee or to such Holder, then

and in every such case the Company, each of the Guarantors, the Trustee and the

Holders shall, subject to any determination in such proceeding, be restored

severally and respectively to their former positions hereunder, and thereafter

all rights and remedies of the Trustee and the Holders shall continue as though

no such proceeding had been instituted.

 

Section 510.  Rights and Remedies Cumulative.

 

No right or remedy herein conferred upon or reserved

to the Trustee or to the Holders is intended to be exclusive of any other right

or remedy, and every right and remedy shall, to the extent permitted by law, be

cumulative and in addition to every other right and remedy given hereunder or

now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or

remedy hereunder, or otherwise, shall not prevent the concurrent assertion or

employment of any other appropriate right or remedy.

 

88

 

Section 511.  Delay or Omission Not Waiver.

 

No delay or omission of the Trustee or of any Holder

of any Security to exercise any right or remedy accruing upon any Event of

Default shall impair any such right or remedy or constitute a waiver of any

such Event of Default or an acquiescence therein.  Every right and remedy given by this Article or by law to the

Trustee or to the Holders may be exercised from time to time, and as often as

may be deemed expedient, by the Trustee or by the Holders, as the case may be.

 

Section 512.  Control by Holders.

 

The Holders of not less than a majority in aggregate

principal amount of the Outstanding Securities shall have the right to direct

the time, method and place of conducting any proceeding for any remedy

available to the Trustee, or exercising any trust or power conferred on the

Trustee, provided that

 

(a)           such

direction shall not be in conflict with any rule of law or with this Indenture

or any Guarantee or expose the Trustee to personal liability; and

 

(b)           the

Trustee may take any other action deemed proper by the Trustee which is not

inconsistent with such direction.

 

Section 513.  Waiver of Past Defaults.

 

The Holders of not less than a majority in aggregate

principal amount of the Outstanding Securities may on behalf of the Holders of

all the Securities waive any past Default hereunder and its consequences,

except a Default

 

(a)           in

the payment of the principal of, premium, if any, or interest (including

Penalty Interest) on any Security; or

 

(b)           in

respect of a covenant or a provision hereof which under Article Nine cannot be

modified or amended without the consent of a higher percentage of the principal

amount of the Outstanding Securities affected.

 

Upon any such waiver, such Default shall cease to

exist, and any Event of Default arising therefrom shall be deemed to have been

cured, for every purpose of this Indenture; but no such waiver shall extend to

any subsequent or other Default or impair any right consequent thereon.

 

Section 514.  Undertaking for Costs.

 

All parties to this Indenture agree, and each Holder

of any Security by his acceptance thereof shall be deemed to have agreed, that

any court may in its discretion

 

89

 

require, in any suit for the enforcement of any right or remedy under

this Indenture, or in any suit against the Trustee for any action taken,

suffered or omitted by it as Trustee, the filing by any party litigant in such

suit of an undertaking to pay the costs of such suit, and that such court may

in its discretion assess reasonable costs, including reasonable attorneys’

fees, against any party litigant in such suit, having due regard to the merits

and good faith of the claims or defenses made by such party litigant; but the

provisions of this Section shall not apply to any suit instituted by the

Trustee, to any suit instituted by any Holder, or group of Holders, holding in

the aggregate more than 10% in principal amount of the Outstanding Securities,

or to any suit instituted by any Holder for the enforcement of the payment of

the principal of, premium, if any, or interest on any Security on or after the respective

Stated Maturities expressed in such Security (or, in the case of redemption, on

or after the Redemption Date).

 

Section 515.  Waiver of Stay, Extension or Usury Laws.

 

Each of the Company and any Guarantor covenants (to the extent that it

may lawfully do so) that it will not at any time insist upon, or plead, or in

any manner whatsoever claim or take the benefit or advantage of, any stay or

extension law or any usury or other law wherever enacted, now or at any time

hereafter in force, which would prohibit or forgive the Company or any

Guarantor from paying all or any portion of the principal of, premium, if any,

or interest on the Securities contemplated herein or in the Securities or which

may affect the covenants or the performance of this Indenture; and each of the

Company and any Guarantor (to the extent that it may lawfully do so) hereby

expressly waives all benefit or advantage of any such law, and covenants that

it will not hinder, delay or impede the execution of any power herein granted to

the Trustee, but will suffer and permit the execution of every such power as

though no such law had been enacted.

 

ARTICLE SIX

 

THE TRUSTEE

 

Section 601.  Notice of Defaults.

 

Within 30 days after the occurrence of any Default,

the Trustee shall transmit by mail to all Holders, as their names and addresses

appear in the Security Register, notice of such Default hereunder known to the

Trustee, unless such Default shall have been cured or waived; provided, however,

that, except in the case of a Default in the payment of the principal of,

premium, if any, or interest on any Security, the Trustee shall be protected in

withholding such notice if and so long as a trust committee of Responsible

Officers of the Trustee in good faith determines that the withholding of such

notice is in the interest of the Holders.

 

90

 

Section 602.  Certain Rights of Trustee.

 

Subject to the provisions of Trust Indenture Act

Sections 315(a) through 315(d):

 

(a)           the

Trustee may rely and shall be protected in acting or refraining from acting

upon any resolution, certificate, statement, instrument, opinion, report,

notice, request, direction, consent, order, bond, debenture, note, other

evidence of Indebtedness or other paper or document believed by it to be

genuine and to have been signed or presented by the proper party or parties;

 

(b)           any

request or direction of the Company mentioned herein shall be sufficiently

evidenced by a Company Request or Company Order and any resolution of the Board

of Directors may be sufficiently evidenced by a Board Resolution;

 

(c)           the

Trustee may consult with counsel and any written advice of such counsel or any

Opinion of Counsel shall be full and complete authorization and protection in

respect of any action taken, suffered or omitted by it hereunder in good faith

and in reliance thereon in accordance with such advice or Opinion of Counsel;

 

(d)           the

Trustee shall be under no obligation to exercise any of the rights or powers

vested in it by this Indenture at the request or direction of any of the

Holders pursuant to this Indenture, unless such Holders shall have offered to

the Trustee security or indemnity satisfactory to the Trustee against the

costs, expenses and liabilities which might be incurred therein or thereby in

compliance with such request or direction;

 

(e)           the

Trustee shall not be liable for any action taken or omitted by it in good faith

and believed by it to be authorized or within the discretion, rights or powers

conferred upon it by this Indenture other than any liabilities arising out of

the negligence of the Trustee;

 

(f)            the

Trustee shall not be bound to make any investigation into the facts or matters

stated in any resolution, certificate, statement, instrument, opinion, report,

notice, request, direction, consent, order, approval, appraisal, bond,

debenture, note, coupon, security or other paper or document; provided,

that the Trustee in its discretion may make such further inquiry or

investigation into such facts or matters as it may deem fit, and, if the

Trustee shall determine to make such further inquiry or investigation, it shall

be entitled to examine the books, records and premises of the Company,

personally or by agent or attorney;

 

(g)           the

Trustee may execute any of the trusts or powers hereunder or perform any duties

hereunder either directly or by or through agents or attorneys and the

 

91

 

Trustee shall not be responsible for any misconduct or negligence on

the part of any agent or attorney appointed with due care by it hereunder;

 

(h)           no

provision of this Indenture shall require the Trustee to expend or risk its own

funds or otherwise incur any financial liability in the performance of any of

its duties hereunder, or in the exercise of any of its rights or powers;

 

(i)            the

Trustee shall not be liable for interest on any money received by it except as

the Trustee may agree in writing with the Company, except as otherwise provided

herein;

 

(j)            money

held in trust by the Trustee need not be segregated from other funds except to

the extent required by law, except as otherwise provided herein;

 

(k)           if

a Default or an Event of Default has occurred and is continuing, the Trustee

shall exercise such of the rights and powers vested in it by this Indenture and

use the same degree of care and skill in its exercise thereof as a prudent

person would exercise or use under the circumstances in the conduct of his own

affairs.

 

Section 603.  Trustee

Not Responsible for Recitals, Dispositions of Securities or Application of

Proceeds Thereof.

 

The recitals contained herein and in the Securities,

except the Trustee’s certificates of authentication, shall be taken as the

statements of the Company, and the Trustee assumes no responsibility for their

correctness.  The Trustee makes no

representations as to the validity or sufficiency of this Indenture or of the

Securities, except that the Trustee represents that it is duly authorized to

execute and deliver this Indenture, authenticate the Securities and perform its

obligations hereunder and that the statements made by it in any Statement of

Eligibility and Qualification on Form T-1 supplied to the Company are true and

accurate subject to the qualifications set forth therein.  The Trustee shall not be accountable for the

use or application by the Company of Securities or the proceeds thereof.

 

Section 604.  Trustee and Agents May Hold Securities;

Collections; etc.

 

The Trustee, any Paying Agent, Security Registrar or

any other agent of the Company, in its individual or any other capacity, may

become the owner or pledgee of Securities, with the same rights it would have

if it were not the Trustee, Paying Agent, Security Registrar or such other

agent and, subject to Trust Indenture Act Sections 310 and 311, may otherwise

deal with the Company and receive, collect, hold and retain collections from

the Company with the same rights it would have if it were not the Trustee,

Paying Agent, Security Registrar or such other agent.

 

92

 

Section 605.  Money Held in Trust.

 

All moneys received by the Trustee shall, until used

or applied as herein provided, be held in trust for the purposes for which they

were received, but need not be segregated from other funds except to the extent

required by mandatory provisions of law. 

Except for funds or securities deposited with the Trustee pursuant to

Article Four, the Trustee may invest all moneys received by the Trustee, until

used or applied as herein provided, in Temporary Cash Investments in accordance

with the written directions of the Company. 

The Trustee shall not be liable for any losses incurred in connection

with any investments made in accordance with this Section 605, unless the

Trustee acted with gross negligence or in bad faith.  With respect to any losses on investments made under this Section

605, the Company is liable for the full extent of any such loss.

 

Section 606.  Compensation

and Indemnification of Trustee and Its Prior Claim.

 

The Company covenants and agrees to pay to the Trustee

from time to time, and the Trustee shall be entitled to, such compensation for

all services rendered by it hereunder (which shall not be limited by any

provision of law in regard to the compensation of a trustee of an express

trust) set forth in a letter agreement executed by the Company and the Trustee,

as such agreement may be amended or supplemented, and the Company covenants and

agrees to pay or reimburse the Trustee and each predecessor Trustee upon its

request for all reasonable expenses, disbursements and advances incurred or

made by or on behalf of it in accordance with any of the provisions of this

Indenture (including the reasonable compensation and the expenses and

disbursements of its counsel and of all agents and other persons not regularly

in its employ) except any such expense, disbursement or advance as may arise

from its negligence or bad faith.  The

Company also covenants to indemnify the Trustee and each predecessor Trustee

for, and to hold it harmless against, any loss, liability, tax, assessment or

other governmental charge (other than taxes applicable to the Trustee’s

compensation hereunder) or expense incurred without negligence or bad faith on

such Trustee’s part, arising out of or in connection with the acceptance or administration

of this Indenture or the trusts hereunder and such Trustee’s duties hereunder,

including enforcement of this Indenture and also including any liability which

the Trustee may incur as a result of failure to withhold, pay or report any

tax, assessment or other governmental charge, and the costs and expenses of

defending itself against or investigating any claim of liability (whether

asserted by any Holder, the Company or any other Person) in connection with the

exercise or performance of any of its powers or duties under this

Indenture.  The obligations of the

Company under this Section to compensate and indemnify the Trustee and each

predecessor Trustee and to pay or reimburse the Trustee and each predecessor

Trustee for expenses, disbursements and advances shall constitute an additional

obligation hereunder and shall survive the satisfaction and discharge of this

Indenture.

 

93

 

All payments and reimbursements pursuant to this

Section 606 shall be made with interest at the rate borne by the Securities.

 

As security for the performance of the obligations of

the Company under this Section 606, the Trustee shall have a Lien prior to the

Securities upon all property and funds held or collected by the Trustee, except

funds held in trust for the payment of principal of (and premium, if any) or

interest on particular Securities.  The

Trustee’s right to receive payment of any amounts due under this Section 606

shall not be subordinate to any other liability or indebtedness of the Company

(even though the Securities may be so subordinate), and the Securities shall be

subordinate to the Trustee’s right to receive such payment.

 

Section 607.  Conflicting Interests.

 

The Trustee shall comply with the provisions of

Section 310(b) of the Trust Indenture Act.

 

Section 608.  Corporate Trustee Required; Eligibility.

 

There shall at all times be a Trustee hereunder which

shall be eligible to act as trustee under Trust Indenture Act Section 310(a)(1)

and which shall have a combined capital and surplus of at least $250,000,000,

to the extent there is an institution eligible and willing to serve.  The Trustee shall be a participant in the

Depository Trust Company and FAST distribution systems.  If such corporation publishes reports of

condition at least annually, pursuant to law or to the requirements of federal,

state, territorial or District of Columbia supervising or examining authority,

then for the purposes of this Section, the combined capital and surplus of such

corporation shall be deemed to be its combined capital and surplus as set forth

in its most recent report of condition so published.  If at any time the Trustee shall cease to be eligible in

accordance with the provisions of this Section, the Trustee shall resign

immediately in the manner and with the effect hereinafter specified in this

Article.  The Corporate Trust Office

shall initially be located at First Union National Bank, 901 East Cary Street,

Richmond, Virginia 23219.

 

Section 609.  Resignation and Removal; Appointment of

Successor Trustee.

 

(a)           No

resignation or removal of the Trustee and no appointment of a successor trustee

pursuant to this Article shall become effective until the acceptance of

appointment by the successor trustee under Section 610.

 

(b)           The

Trustee, or any trustee or trustees hereafter appointed, may at any time resign

by giving written notice thereof to the Company.  Upon receiving such notice of resignation, the Company shall

promptly appoint a successor trustee by written instrument executed by

authority of the Board of Directors of the Company, a copy of

 

94

 

which shall be delivered to the resigning Trustee and a copy to the

successor trustee.  If an instrument of

acceptance by a successor trustee shall not have been delivered to the Trustee

within 30 days after the giving of such notice of resignation, the resigning

Trustee may, or any Holder who has been a bona fide Holder of a Security for at

least six months may, on behalf of himself and all others similarly situated,

petition any court of competent jurisdiction for the appointment of a successor

trustee.  Such court may thereupon,

after such notice, if any, as it may deem proper, appoint a successor trustee.

 

(c)           The

Trustee may be removed at any time by an Act of the Holders of not less than a

majority in aggregate principal amount of the Outstanding Securities, delivered

to the Trustee and to the Company.

 

(d)           If

at any time:

 

(1)           the Trustee shall

fail to comply with the provisions of Trust Indenture Act Section 310(b) after

written request therefor by the Company or by any Holder who has been a bona

fide Holder of a Security for at least six months, or

 

(2)           the Trustee shall

cease to be eligible under Section 608 and shall fail to resign after written

request therefor by the Company or by any Holder who has been a bona fide

Holder of a Security for at least six months, or

 

(3)           the Trustee shall

become incapable of acting or shall be adjudged a bankrupt or insolvent, or a

receiver of the Trustee or of its property shall be appointed or any public

officer shall take charge or control of the Trustee or of its property or

affairs for the purpose of rehabilitation, conservation or liquidation,

 

then, in any case, (i) the Company by a Board Resolution may

remove the Trustee, or (ii) subject to Section 514, the Holder of any

Security who has been a bona fide Holder of a Security for at least six months

may, on behalf of himself and all others similarly situated, petition any court

of competent jurisdiction for the removal of the Trustee and the appointment of

a successor trustee.  Such court may

thereupon, after such notice, if any, as it may deem proper and prescribe,

remove the Trustee and appoint a successor trustee.

 

(e)           If

the Trustee shall be removed or become incapable of acting, or if a vacancy

shall occur in the office of Trustee for any cause, the Company, by a Board

Resolution, shall promptly appoint a successor trustee.  If, within one year after such removal or

incapability, or the occurrence of such vacancy, a successor trustee shall be

appointed by Act of the Holders of a majority in principal amount of the

Outstanding

 

95

 

Securities delivered to the Company and the retiring Trustee, the

successor trustee so appointed shall, forthwith upon its acceptance of such

appointment, become the successor trustee and supersede the successor trustee

appointed by the Company.  If no

successor trustee shall have been so appointed by the Company or the Holders of

the Securities and accepted appointment in the manner hereinafter provided, the

Holder of any Security who has been a bona fide Holder for at least six months

may, subject to Section 514, on behalf of himself and all others similarly

situated, petition any court of competent jurisdiction for the appointment of a

successor Trustee.

 

(f)            The

Company shall give notice of each resignation and each removal of the Trustee

and each appointment of a successor trustee by mailing written notice of such

event by first-class mail, postage prepaid, to the Holders of Securities as

their names and addresses appear in the Security Register.  Each notice shall include the name of the

successor trustee and the address of its Corporate Trust Office or agent

hereunder.

 

Section 610.  Acceptance of Appointment by Successor.

 

Every successor Trustee appointed hereunder shall

execute, acknowledge and deliver to the Company and to the retiring Trustee an

instrument accepting such appointment, and thereupon the resignation or removal

of the retiring Trustee shall become effective and such successor trustee,

without any further act, deed or conveyance, shall become vested with all the

rights, powers, trusts and duties of the retiring Trustee as if originally named

as Trustee hereunder; but, nevertheless, on the written request of the Company

or the successor trustee, upon payment of its charges then unpaid, such

retiring Trustee shall, pay over to the successor trustee all moneys at the

time held by it hereunder and shall execute and deliver an instrument

transferring to such successor trustee all such rights, powers, duties and

obligations.  Upon request of any such

successor trustee, the Company shall execute any and all instruments for more

fully and certainly vesting in and confirming to such successor trustee all

such rights and powers.  Any Trustee

ceasing to act shall, nevertheless, retain a prior claim upon all property or

funds held or collected by such Trustee or such successor trustee to secure any

amounts then due such Trustee pursuant to the provisions of Section 606.

 

No successor Trustee with respect to the Securities

shall accept appointment as provided in this Section 610 unless at the time of

such acceptance such successor trustee shall be eligible to act as trustee

under the provisions of Trust Indenture Act Section 310(a) and this

Article Sixth and shall have a combined capital and surplus of at least

$250,000,000 and have a Corporate Trust Office or an agent selected in

accordance with Section 608.

 

Upon acceptance of appointment by any successor

Trustee as provided in this Section 610, the Company shall give notice thereof

to the Holders of the Securities, by mailing such notice to such Holders at

their addresses as they shall appear on the Security

 

96

 

Register.  If the acceptance of

appointment is substantially contemporaneous with the resignation, then the

notice called for by the preceding sentence may be combined with the notice

called for by Section 609.  If the

Company fails to give such notice within 10 days after acceptance of

appointment by the successor trustee, the successor trustee shall cause such

notice to be given at the expense of the Company.

 

Section 611.  Merger, Conversion, Consolidation or

Succession to Business.

 

Any corporation into which the Trustee may be merged

or converted or with which it may be consolidated, or any corporation resulting

from any merger, conversion or consolidation to which the Trustee shall be a

party, or any corporation succeeding to all or substantially all of the

corporate trust business of the Trustee, shall be the successor of the Trustee

hereunder, provided such corporation shall be eligible under Trust Indenture

Act Section 310(a) and this Article Sixth and shall have a combined capital and

surplus of at least $250,000,000 and have a Corporate Trust Office or an agent

selected in accordance with Section 608 without the execution or filing of any

paper or any further act on the part of any of the parties hereto.

 

In case at the time such successor to the Trustee

shall succeed to the trusts created by this Indenture any of the Securities

shall have been authenticated but not delivered, any such successor to the

Trustee may adopt the certificate of authentication of any predecessor Trustee

and deliver such Securities so authenticated; and, in case at that time any of

the Securities shall not have been authenticated, any successor to the Trustee

may authenticate such Securities either in the name of any predecessor

hereunder or in the name of the successor trustee; and in all such cases such

certificate shall have the full force which it is anywhere in the Securities or

in this Indenture provided that the certificate of the Trustee shall have; provided

that the right to adopt the certificate of authentication of any predecessor

Trustee or to authenticate Securities in the name of any predecessor Trustee

shall apply only to its successor or successors by merger, conversion or

consolidation.

 

Section 612.  Preferential Collection of Claims Against

Company.

 

If and when the Trustee shall be or become a creditor

of the Company (or other obligor under the Securities), the Trustee shall be

subject to the provisions of the Trust Indenture Act regarding the collection

of claims against the Company (or any such other obligor).  A Trustee who has resigned or been removed

shall be subject to the Trust Indenture Act Section 311(a) to the extent

indicated therein.

 

97

 

ARTICLE SEVEN

 

HOLDERS’ LISTS AND

REPORTS BY TRUSTEE AND COMPANY

 

Section 701.  Company to Furnish Trustee Names and

Addresses of Holders.

 

The Company will furnish or cause to be furnished to

the Trustee

 

(a)           semiannually,

not more than 15 days after each Regular Record Date, a list, in such form as

the Trustee may reasonably require, of the names and addresses of the Holders

as of such Regular Record Date; and

 

(b)           at

such other times as the Trustee may request in writing, within 30 days after

receipt by the Company of any such request, a list of similar form and content

as of a date not more than 15 days prior to the time such list is furnished;

 

provided, however, that if

and so long as the Trustee shall be the Security Registrar, no such list need

be furnished.

 

Section 702.  Disclosure of Names and Addresses of

Holders.

 

Holders may communicate pursuant to Trust Indenture

Act Section 312(b) with other Holders with respect to their rights under this

Indenture or the Securities, and the Trustee shall comply with Trust Indenture

Act Section 312(b).  The Company, the

Trustee, the Security Registrar and any other Person shall have the protection

of Trust Indenture Act 312(c).  Every Holder

of Securities, by receiving and holding the same, agrees with the Company and

the Trustee that neither the Company nor the Trustee nor any agent of either of

them shall be held accountable by reason of the disclosure of any information

as to the names and addresses of the Holders in accordance with Trust Indenture

Act Section 312, regardless of the source from which such information was

derived, and that the Trustee shall not be held accountable by reason of

mailing any material pursuant to a request made under Trust Indenture Act

Section 312.

 

Section 703.  Reports by Trustee.

 

Within 60 days after May 15 of each year

commencing with the first May 15 after the first issuance of Securities,

the Trustee shall transmit by mail to all Holders, as their names and addresses

appear in the Security Register, as provided in Trust Indenture Act Section

313(c), a brief report dated as of such May 15 in accordance with and to

the extent required by Trust Indenture Act Section 313(a).

 

Section 704.  Reports by Company and Guarantors.

 

The Company and any Guarantor shall:

 

98

 

(a)           file

with the Trustee, within 15 days after the Company or any Guarantor, as the

case may be, is required to file the same with the Commission, copies of the

annual reports and of the information, documents and other reports (or copies

of such portions of any of the foregoing as the Commission may from time to

time by rules and regulations prescribe) which the Company or any Guarantor may

be required to file with the Commission pursuant to Section 13 or Section 15(d)

of the Exchange Act; or, if the Company or any Guarantor, as the case may be,

is not required to file information, documents or reports pursuant to either of

said Sections, then it shall file with the Trustee and the Commission, in

accordance with rules and regulations prescribed from time to time by the

Commission, such of the supplementary and periodic information, documents and

reports which may be required pursuant to Section 13 of the Exchange Act in

respect of a security listed and registered on a national securities exchange

as may be prescribed from time to time in such rules and regulations;

 

(b)           file

with the Trustee and the Commission, in accordance with the rules and

regulations prescribed from time to time by the Commission, such additional

information, documents and reports with respect to compliance by the Company or

any Guarantor, as the case may be, with the conditions and covenants of this

Indenture as may be required from time to time by such rules and regulations;

and

 

(c)           transmit

or cause to be transmitted by mail to all Holders, as their names and addresses

appear in the Security Register, within 30 days after the filing thereof with

the Trustee, in the manner and to the extent provided in Trust Indenture Act

Section 313(c), such summaries of any information, documents and reports

required to by filed by the Company or any Guarantor, as the case may be,

pursuant to Subsections (a) and (b) of this Section as may be required by rules

and regulations prescribed from time to time by the Commission.

 

ARTICLE EIGHT

 

CONSOLIDATION, MERGER,

CONVEYANCE, TRANSFER OR

LEASE

 

Section 801.  Company

or Any Guarantor May Consolidate, etc., Only on Certain Terms.

 

(a)           The

Company shall not, in a single transaction or through a series of related

transactions, consolidate with or merge with or into any other Person or sell,

assign, convey, transfer, lease or otherwise dispose of all or substantially

all of its properties and assets as an entirety to any Person or group of

affiliated Persons, or permit any of its Subsidiaries to enter into any such

transaction or transactions if such transaction

 

99

 

or transactions, in the aggregate, would result in a sale, assignment,

conveyance, transfer, lease or disposal of all or substantially all of the

properties and assets of the Company and its Subsidiaries on a Consolidated

basis to any other Person or group of affiliated Persons, unless at the time

and after giving effect thereto:

 

(i)            either (1) the Company shall be

the continuing corporation, or (2) the Person (if other than the Company)

formed by such consolidation or into which the Company is merged or the Person

which acquires by sale, assignment, conveyance, transfer, lease or disposition

of all or substantially all of the properties and assets of the Company and its

Subsidiaries on a Consolidated basis (the “Surviving Entity”) shall be a

corporation duly organized and validly existing under the laws of the United

States of America, any state thereof or the District of Columbia and such

Person assumes, by a supplemental indenture in a form reasonably satisfactory

to the Trustee, all the obligations of the Company under the Securities and

this Indenture and the Registration Rights Agreement, and this Indenture and

the Registration Rights Agreement shall remain in full force and effect;

 

(ii)           immediately before and immediately

after giving effect to such transaction, no Default or Event of Default shall

have occurred and be continuing;

 

(iii)          immediately after giving effect to

such transaction on a pro forma basis, the Consolidated Net Worth of the

Company (or the Surviving Entity if the Company is not the continuing obligor

under this Indenture) is equal to or greater than the Consolidated Net Worth of

the Company immediately prior to such transaction;

 

(iv)          immediately before and immediately

after giving effect to such transaction on a pro forma basis (on the assumption

that the transaction occurred on the first day of the four-quarter period

immediately prior to the consummation of such transaction with the appropriate

adjustments with respect to the transaction being included in such pro forma

calculation), the Company (or the Surviving Entity if the Company is not the

continuing obligor under this Indenture) could incur $1.00 of additional

Indebtedness under Section 1008 (other than Permitted Indebtedness);

 

(v)           each Guarantor, if any, unless it is

the other party to the transactions described above, shall have by supplemental

indenture confirmed that its Guarantee shall apply to such Person’s obligations

under this Indenture and the Securities;

 

100

 

(vi)          if any of the property or assets of

the Company or any of its Subsidiaries would thereupon become subject to any

Lien, the provisions of Section 1012 are complied with; and

 

(vii)         the Company or the Surviving Entity

shall have delivered, or caused to be delivered, to the Trustee, in form and

substance reasonably satisfactory to the Trustee, an Officers’ Certificate and

an Opinion of Counsel, each to the effect that such consolidation, merger,

transfer, sale, assignment, conveyance, lease or other transaction and the

supplemental indenture in respect thereto comply with this Indenture and that

all conditions precedent herein provided for relating to such transaction have

been complied with.

 

(b)           Each

Guarantor shall not, and the Company shall not permit a Guarantor to, in a

single transaction or through a series of related transactions merge or

consolidate with or into any other corporation (other than the Company or any

other Guarantor) or other entity, or sell, assign, convey, transfer, lease or

otherwise dispose of all or substantially all of its properties and assets on a

Consolidated basis to any entity (other than the Company or any other

Guarantor) unless at the time and after giving effect thereto:

 

(i)            either (1) such Guarantor shall

be the continuing corporation or (2) the entity (if other than such

Guarantor) formed by such consolidation or into which such Guarantor is merged

or the entity which acquires by sale, assignment, conveyance, transfer, lease

or disposition the properties and assets of such Guarantor shall be a

corporation duly organized and validly existing under the laws of the United

States, any state thereof or the District of Columbia and shall expressly

assume by an indenture supplemental hereto, executed and delivered to the

Trustee, in a form reasonably satisfactory to the Trustee, all the obligations

of such Guarantor under its Guarantees and this Indenture and the Registration

Rights Agreement;

 

(ii)           immediately before and immediately

after giving effect to such transaction, no Default or Event of Default shall

have occurred and be continuing; and

 

(iii)          such Guarantor shall have delivered to

the Trustee, in form and substance reasonably satisfactory to the Trustee, an

Officers’ Certificate and an Opinion of Counsel, each stating that such

consolidation, merger, sale, assignment, conveyance, transfer, lease or

disposition and such supplemental indenture comply with this Indenture, and

thereafter all obligations of the predecessor shall terminate.

 

101

 

The provisions of this Section 801(b) shall not apply to any

transaction (including any Asset Sale made in accordance with Section 1013)

with respect to any Guarantor if the Guarantee of such Guarantor is released in

connection with such transaction in accordance with Section 1014(c).

 

Section 802.  Successor Substituted.

 

Upon any consolidation or merger, or any sale,

assignment, conveyance, transfer, lease or disposition of all or substantially

all of the properties and assets of the Company or any Guarantor in accordance

with Section 801, the successor Person formed by such consolidation or into

which the Company or such Guarantor, as the case may be, is merged or the

successor Person to which such sale, assignment, conveyance, transfer, lease or

disposition is made shall succeed to, and be substituted for, and may exercise

every right and power of, the Company or such Guarantor, as the case may be,

under this Indenture, the Securities and/or such Guarantee, as the case may be,

with the same effect as if such successor had been named as the Company or such

Guarantor, as the case may be, herein, in the Securities and/or in such

Guarantee, as the case may be.  When a

successor assumes all the obligations of its predecessor under this Indenture,

the Securities or a Guarantee, as the case may be, the predecessor shall be released

from those obligations; provided that in the case of a transfer by

lease, the predecessor shall not be released from the payment of principal and

interest on the Securities or a Guarantee, as the case may be, and the

Registration Rights Agreement.

 

ARTICLE NINE

 

SUPPLEMENTAL INDENTURES

 

Section 901.  Supplemental

Indentures and Agreements without Consent of Holders.

 

Without the consent of any Holders, the Company and

the Guarantors, when authorized by a Board Resolution, and the Trustee, at any

time and from time to time, may enter into one or more indentures supplemental

hereto, or agreements or other instruments with respect to any Guarantee, in

form and substance satisfactory to the Trustee, for any of the following

purposes:

 

(a)           to

evidence the succession of another Person to the Company, any Guarantor or any

other obligor upon the Securities, and the assumption by any such successor of

the covenants of the Company or such Guarantor or obligor herein and in the

Securities and in any Guarantee, in each case in compliance with the provisions

of this Indenture;

 

102

 

(b)           to

add to the covenants of the Company, any Guarantor or any other obligor upon

the Securities for the benefit of the Holders, or to surrender any right or

power herein conferred upon the Company, any Guarantor or any other obligor

upon the Securities, as applicable, herein, in the Securities or in any

Guarantee;

 

(c)           to

cure any ambiguity, to correct or supplement any provision herein which may be

defective or inconsistent with any other provision herein or in any Guarantee,

or to make any other provisions with respect to matters or questions arising

under this Indenture, the Securities or any Guarantee; provided that, in

each case, such provisions shall not adversely affect the interests of the

Holders;

 

(d)           to

comply with the requirements of the Commission in order to effect or maintain

the qualification of this Indenture under the Trust Indenture Act, as

contemplated by Section 905 or otherwise;

 

(e)           to

add a Guarantor pursuant to the requirements of Section 1014;

 

(f)            to

evidence and provide the acceptance of the appointment of a successor trustee

hereunder;

 

(g)           to

mortgage, pledge, hypothecate or grant a security interest in favor of the

Trustee for the benefit of the Holders as additional security for the payment

and performance of the Indenture Obligations, in any property or assets,

including any which are required to be mortgaged, pledged or hypothecated, or

in which a security interest is required to be granted to the Trustee pursuant

to this Indenture or otherwise; or

 

(h)           to

provide for uncertificated Securities in place of or in addition to

certificated Securities.

 

Section 902.  Supplemental

Indentures and Agreements with Consent of Holders.

 

With the consent of the Holders of not less than a

majority in aggregate principal amount of the Outstanding Securities, by Act of

said Holders delivered to the Company, each Guarantor, and the Trustee, the

Company, and each Guarantor (if a party thereto) when authorized by a Board

Resolution, and the Trustee may enter into an indenture or indentures

supplemental hereto or agreements or other instruments with respect to any

Guarantee in form and substance satisfactory to the Trustee for the purpose of

adding any provisions to or changing in any manner or eliminating any of the

provisions of this Indenture or of modifying in any manner the rights of the

Holders under this Indenture, the Securities or any Guarantee; provided,

however, that no such supplemental indenture, agreement or instrument

shall, without the consent of the Holder of each Outstanding Security affected

thereby:

 

103

 

(a)           change

the Stated Maturity of the principal of, or any installment of interest on, any

Security, or reduce the principal amount thereof or the rate of interest

thereon or any premium payable upon the redemption thereof, or change the coin

or currency in which the principal of any Security or any premium or the

interest thereon is payable, or impair the right to institute suit for the

enforcement of any such payment after the Stated Maturity thereof (or, in the

case of redemption, on or after the Redemption Date) (other than the provisions

of Section 1013);

 

(b)           amend,

change or modify the obligation of the Company to make and consummate an Offer

with respect to any Asset Sale or Asset Sales in accordance with Section 1013

or the obligation of the Company to make and consummate a Change of Control

Offer in the event of a Change of Control in accordance with Section 1016,

including amending, changing or modifying any definitions with respect thereto;

 

(c)           reduce

the percentage in principal amount of the Outstanding Securities, the consent

of whose Holders is required for any such supplemental indenture, or the

consent of whose Holders is required for any waiver or compliance with certain

provisions of this Indenture or certain defaults hereunder and their

consequences provided for in this Indenture or with respect to any Guarantee;

 

(d)           modify

any of the provisions of this Section or Sections 513 or 1022, except to

increase the percentage in principal amount of the Outstanding Securities, the

consent of whose Holders is required for any such actions or to provide that

certain other provisions of this Indenture cannot be modified or waived without

the consent of the Holder of each Security affected thereby;

 

(e)           except

as otherwise permitted under Article Eight, consent to the assignment or

transfer by the Company or any Guarantor of any of its rights and obligations

under this Indenture; or

 

(f)            amend

or modify any of the provisions of this Indenture relating to the subordination

of the Securities or any Guarantee in any manner adverse to the Holders of the

Securities or any Guarantee;

 

provided, further that no such modification or amendment may without

the consent of the holders of 66 2/3% of the outstanding Notes affected

thereby, amend, change or modify the obligation of the Company to make and

consummate an Offer with respect to any Asset Sale of Asset Sales in accordance

with Section 1013, including amending, changing or modifying any definitions

with respect thereto.

 

Upon the written request of the Company and each

Guarantor, accompanied by a copy of a Board Resolution authorizing the

execution of any such supplemental indenture or Guarantee, and upon the filing

with the Trustee of evidence of the consent of

 

104

 

Holders as aforesaid, the Trustee shall, subject to Section 903, join

with the Company and each Guarantor in the execution of such supplemental

indenture or Guarantee.

 

It shall not be necessary for any Act of Holders under

this Section to approve the particular form of any proposed supplemental

indenture or Guarantee or agreement or instrument relating to any Guarantee,

but it shall be sufficient if such Act shall approve the substance thereof.

 

Section 903.  Execution of Supplemental Indentures and

Agreements.

 

In executing, or accepting the additional trusts

created by, any supplemental indenture, agreement or instrument permitted by

this Article or the modifications thereby of the trusts created by this

Indenture, the Trustee shall be entitled to receive, and (subject to Trust

Indenture Act Section 315(a) through 315(d) and Section 602 hereof) shall be

fully protected in relying upon, an Opinion of Counsel and an Officers’

Certificate stating that the execution of such supplemental indenture,

agreement or instrument is authorized or permitted by this Indenture.  The Trustee may, but shall not be obligated

to, enter into any such supplemental indenture, agreement or instrument which

affects the Trustee’s own rights, duties or immunities under this Indenture,

any Guarantee or otherwise.

 

Section 904.  Effect of Supplemental Indentures.

 

Upon the execution of any supplemental indenture under

this Article, this Indenture shall be modified in accordance therewith, and

such supplemental indenture shall form a part of this Indenture for all

purposes; and every Holder of Securities theretofore or thereafter

authenticated and delivered hereunder shall be bound thereby.

 

Section 905.  Conformity with Trust Indenture Act.

 

Every supplemental indenture executed pursuant to this

Article shall conform to the requirements of the Trust Indenture Act as then in

effect.

 

Section 906.  Reference in Securities to Supplemental

Indentures.

 

Securities authenticated and delivered after the

execution of any supplemental indenture pursuant to this Article may, and shall

if required by the Trustee, bear a notation in form approved by the Trustee as

to any matter provided for in such supplemental indenture.  If the Company shall so determine, new

Securities so modified as to conform, in the opinion of the Trustee and the

Board of Directors, to any such supplemental indenture may be prepared and

executed by the Company and each Guarantor and authenticated and delivered by

the Trustee in exchange for Outstanding Securities.

 

105

 

Section 907.  Effect on Senior Indebtedness.

 

No supplemental indenture shall adversely affect the

rights under Articles Twelve and Fourteen, or any definitions or provisions

related thereto, or the Guarantees of any holder of Senior Indebtedness or

Guarantor Senior Indebtedness unless the requisite holders of each issue of

Senior Indebtedness or Guarantor Senior Indebtedness affected thereby shall

have consented to such supplemental indenture.

 

ARTICLE TEN

 

COVENANTS

 

Section 1001.  Payment of Principal, Premium and

Interest.

 

Subject to the provisions of Articles Twelve and

Fourteen, the Company will duly and punctually pay the principal of, premium,

if any, and interest on the Securities in accordance with the terms of the

Securities and this Indenture.

 

Section 1002. 

Maintenance of Office or Agency.

 

The Company will maintain an office or agency where

Securities may be presented or surrendered for payment.  The Company also will maintain an office or

agency where Securities may be surrendered for registration of transfer,

redemption or exchange and where notices and demands to or upon the Company in

respect of the Securities and this Indenture may be served.  The Company will give prompt written notice

to the Trustee of the location and any change in the location of any such

offices or agencies.  If at any time the

Company shall fail to maintain any such required offices or agencies or shall

fail to furnish the Trustee with the address thereof, such presentations,

surrenders, notices and demands may be made or served at the office of the

agent of the Trustee described above and the Company hereby appoints such agent

as its agent to receive all such presentations, surrenders, notices and

demands.

 

The Company may 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 designation.  The Company will give

prompt written notice to the Trustee of any such designation or rescission and

any change in the location of any such office or agency.

 

Section 1003. 

Money for Security Payments to Be Held

in Trust.

 

If the Company shall at any time act as its own Paying

Agent, it will, on or before each due date of the principal of, premium, if

any, or interest on any of the

 

106

 

Securities, segregate and hold in trust for the benefit of the Holders

entitled thereto a sum sufficient to pay the principal, premium, if any, or

interest so becoming due until such sums shall be paid to such Persons or otherwise

disposed of as herein provided, and will promptly notify the Trustee of its

action or failure so to act.

 

If the Company is not acting as Paying Agent, the

Company will, before each due date of the principal of, premium, if any, or

interest on any Securities, deposit with a Paying Agent a sum in same day funds

sufficient to pay the principal, premium, if any, or interest so becoming due,

such sum to be held in trust for the benefit of the Persons entitled to such

principal, premium or interest, and (unless such Paying Agent is the Trustee)

the Company will promptly notify the Trustee of such action or any failure so

to act.

 

If the Company is not acting as Paying Agent, the

Company will cause each Paying Agent other than the Trustee to execute and deliver

to the Trustee an instrument in which such Paying Agent shall agree with the

Trustee, subject to the provisions of this Section, that such Paying Agent

will:

 

(a)           hold

all sums held by it for the payment of the principal of, premium, if any, or

interest on Securities in trust for the benefit of the Persons entitled thereto

until such sums shall be paid to such Persons or otherwise disposed of as

herein provided;

 

(b)           give

the Trustee notice of any Default by the Company or any Guarantor (or any other

obligor upon the Securities) in the making of any payment of principal,

premium, if any, or interest;

 

(c)           at

any time during the continuance of any such Default, upon the written request

of the Trustee, forthwith pay to the Trustee all sums so held in trust by such

Paying Agent; and

 

(d)           acknowledge,

accept and agree to comply in all aspects with the provisions of this Indenture

relating to the duties, rights and disabilities of such Paying Agent.

 

The Company may at any time, for the purpose of

obtaining the satisfaction and discharge of this Indenture or for any other

purpose, pay, or by Company Order direct any Paying Agent to pay, to the

Trustee all sums held in trust by the Company or such Paying Agent, such sums

to be held by the Trustee upon the same trusts as those upon which such sums

were held by the Company or such Paying Agent; and, upon such payment by any

Paying Agent to the Trustee, such Paying Agent shall be released from all

further liability with respect to such money.

 

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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, including each Guarantor, upon the Securities or the property of the

Company or of such other obligor or their creditors, the Trustee shall serve as

the Paying Agent.

 

Any money deposited with the Trustee or any Paying

Agent, or then held by the Company, in trust for the payment of the principal

of, premium, if any, or interest on any Security and remaining unclaimed for

two years after such principal and premium, if any, or interest has become due

and payable shall promptly be paid to the Company on Company Request, or (if

then held by the Company) shall be discharged from such trust; and the Holder

of such Security shall thereafter, as an unsecured general creditor, look only

to the Company for payment thereof, and all liability of the Trustee or such

Paying Agent with respect to such trust money, and all liability of the Company

as trustee thereof, shall thereupon cease; provided, however,

that the Trustee or such Paying Agent, before being required to make any such

repayment, may at the expense of the Company cause to be published once, in The

New York Times and The Wall Street Journal (national edition),

notice that such money remains unclaimed and that, after a date specified

therein, which shall not be less than 30 days from the date of such

notification or publication, any unclaimed balance of such money then remaining

will promptly be repaid to the Company.

 

Section 1004.  Corporate Existence.

 

Subject to Article Eight, the Company will do or cause

to be done all things necessary to preserve and keep in full force and effect

the corporate existence and related rights and franchises (charter and

statutory) of the Company and each Subsidiary; provided, however,

that the Company shall not be required to preserve any such right or franchise

or the corporate existence of any such Subsidiary if the Board of Directors of

the Company shall determine that the preservation thereof is no longer

desirable in the conduct of the business of the Company and its Subsidiaries as

a whole and that the loss thereof would not reasonably be expected to have a

material adverse effect on the ability of the Company to perform its

obligations hereunder; and provided, further, however,

that the foregoing shall not prohibit a sale, transfer or conveyance of a

Subsidiary or any of its assets in compliance with the terms of this Indenture.

 

Section 1005.  Payment of Taxes and Other Claims.

 

The Company will pay or discharge or cause to be paid

or discharged, on or before the date the same shall become due and payable,

(a) all taxes, assessments and governmental charges levied or imposed upon

the Company or any Subsidiary shown to be due on any return of the Company or

any Subsidiary or otherwise assessed or upon the income, profits or property of

the Company or any Subsidiary if failure to pay or

 

108

 

discharge the same could reasonably be expected to have a material

adverse effect on the ability of the Company or any Guarantor to perform its

obligations hereunder and (b) all lawful claims for labor, materials and

supplies, which, if unpaid, would by law become a Lien upon the property of the

Company or any Subsidiary, except for any Lien permitted to be incurred under

Section 1012 if failure to pay or discharge the same could reasonably be expected

to have a material adverse effect on the ability of the Company or any

Guarantor to perform its obligations hereunder; provided, however,

that the Company shall not be required to pay or discharge or cause to be paid

or discharged any such tax, assessment, charge or claim whose amount,

applicability or validity is being contested in good faith by appropriate

proceedings properly instituted and diligently conducted and in respect of

which appropriate reserves (in the good faith judgment of management of the

Company) are being maintained in accordance with generally accepted accounting

principles consistently applied.

 

Section 1006.  Maintenance of Properties.

 

The Company will cause all material properties owned

by the Company or any Subsidiary or used or held for use in the conduct of its

business or the business of any Subsidiary to be maintained and kept in good

condition, repair and working order (ordinary wear and tear excepted) and

supplied with all necessary equipment and will cause to be made all necessary

repairs, renewals, replacements, betterments and improvements thereof, all as

in the judgment of the Company may be consistent with sound business practice

and necessary so that the business carried on in connection therewith may be

properly and advantageously conducted at all times; provided, however,

that nothing in this Section shall prevent the Company from discontinuing the

maintenance of any of such properties if such discontinuance is, in the

judgment of the Company, desirable in the conduct of its business or the

business of any Subsidiary and not reasonably expected to have a material

adverse effect on the ability of the Company to perform its obligations

hereunder.

 

Section 1007. 

Insurance.

 

The Company will at all times keep all of its and its

Subsidiaries’ properties which are of an insurable nature insured with

insurers, believed by the Company to be responsible, against loss or damage to

the extent that property of similar character is usually so insured by

corporations similarly situated and owning like properties.

 

Section 1008. 

Limitation on Indebtedness.

 

(a)           The

Company shall not, and shall not permit any Restricted Subsidiary to, create,

incur, assume or directly or indirectly guarantee or in any other manner become

directly or indirectly liable for (“incur”) any Indebtedness (including

Acquired Indebtedness), except that the Company may incur Indebtedness and a

 

109

 

Guarantor may incur Permitted Subsidiary Indebtedness if, in each case,

the Debt to Operating Cash Flow Ratio of the Company and its Restricted

Subsidiaries at the time of the incurrence of such Indebtedness, after giving

pro forma effect thereto, is 7:1 or less.

 

(b)           The

foregoing limitation will not apply to the incurrence of any of the following

(collectively, “Permitted Indebtedness”):

 

(i)           Indebtedness of the Company under the

Bank Credit Agreement in an aggregate principal amount at any one time

outstanding not to exceed amounts committed and undrawn as of the date hereof

under any revolving credit facility thereunder (which amount was $236 million

as of February 28, 2002);

 

(ii)          Indebtedness of the Company pursuant

to the Securities and Indebtedness of any Guarantor pursuant to a Guarantee;

 

(iii)         Indebtedness of any Guarantor

consisting of a guarantee of the Company’s Indebtedness under the Bank Credit

Agreement;

 

(iv)         Indebtedness of the Company or any

Restricted Subsidiary outstanding on the date of this Indenture and listed on

Schedule I hereto;

 

(v)          Indebtedness of the Company owing to a

Restricted Subsidiary; provided that any Indebtedness of the Company

owing to a Restricted Subsidiary that is not a Guarantor is made pursuant to an

intercompany note in the form attached to this Indenture as Exhibit D and is

subordinated in right of payment from and after such time as the Securities

shall become due and payable (whether at Stated Maturity, acceleration or

otherwise) to the payment and performance of the Company’s obligations under

the Securities; provided, further, that any disposition, pledge

or transfer of any such Indebtedness to a Person (other than a disposition,

pledge or transfer to a Wholly Owned Restricted Subsidiary or a pledge to or

for the benefit of the lenders under the Bank Credit Agreement) shall be deemed

to be an incurrence of such Indebtedness by the obligor not permitted by this

clause (v);

 

(vi)         Indebtedness of a Wholly Owned

Restricted Subsidiary owing to the Company or another Wholly Owned Restricted

Subsidiary; provided that, with respect to Indebtedness owing to a

Wholly Owned Subsidiary that is not a Guarantor, (1) any such Indebtedness

is made pursuant to an intercompany note in the form attached to this Indenture

as Exhibit D and (2) any such Indebtedness shall be subordinated in right

of payment from and after such time as the obligations under the Guarantee by

such Wholly Owned Restricted Subsidiary shall become due and payable to the

payment and performance of such Wholly Owned Restricted Subsidiary’s

obligations under its Guarantee; provided, further, that

(1) any disposition, pledge or transfer of any such Indebtedness to a

Person (other than a disposition, pledge or transfer to the Company or a

 

110

 

Wholly Owned Restricted Subsidiary or pledge to or for the benefit of

the lenders under the Bank Credit Agreement) shall be deemed to be an

incurrence of such Indebtedness by the obligor not permitted by this clause

(vi) and (2) any transaction pursuant to which any Wholly Owned Restricted

Subsidiary, which has Indebtedness owing to the Company or any other Wholly

Owned Restricted Subsidiary, ceases to be a Wholly Owned Restricted Subsidiary

shall be deemed to be the incurrence of Indebtedness by such Wholly Owned

Restricted Subsidiary that is not permitted by this clause (vi);

 

(vii)        guarantees of any Restricted Subsidiary

made in accordance with the provisions of Section 1014;

 

(viii)       obligations of the Company entered into

in the ordinary course of business pursuant to Interest Rate Agreements

designed to protect the Company against fluctuations in interest rates in

respect of Indebtedness of the Company, as long as such obligations at the time

incurred do not exceed the aggregate principal amount of such Indebtedness then

outstanding or in good faith anticipated to be outstanding within 90 days of

such incurrence;

 

(ix)          any renewals, extensions,

substitutions, refundings, refinancings or replacements (collectively, a

“refinancing”) of any Indebtedness described in clauses (ii), (iii), (iv) and

(v) above, including any successive refinancings so long as the aggregate

principal amount of Indebtedness represented thereby is not increased by such

refinancing plus the lesser of (I) the stated amount of any premium,

interest or other payment required to be paid in connection with such a

refinancing pursuant to the terms of the Indebtedness being refinanced or

(II) the amount of premium, interest or other payment actually paid at

such time to refinance the Indebtedness, plus, in either case, the amount of

expenses of the Company incurred in connection with such refinancing and, in

the case of Pari Passu or Subordinated Indebtedness, such refinancing does not

reduce the Average Life to Stated Maturity or the Stated Maturity of such

Indebtedness; and

 

(x)           Indebtedness of the Company in

addition to that described in clauses (i) through (ix) above, and any renewals,

extensions, substitutions, refinancings, or replacements of such Indebtedness,

so long as the aggregate principal amount of all such Indebtedness shall not

exceed $25,000,000.

 

Section 1009.  Limitation on Restricted Payments.

 

(a)           The

Company shall not, and shall not permit any Restricted Subsidiary to, directly

or indirectly:

 

(i)           declare or pay any dividend on, or

make any distribution to holders of, any of the Company’s Equity Interests

(other than dividends or distributions payable solely in its Qualified Equity

Interests);

 

111

 

(ii)          purchase, redeem or otherwise acquire

or retire for value, directly or indirectly, any Equity Interest of the Company

or any Affiliate thereof (except Equity Interests held by the Company or a

Wholly Owned Restricted Subsidiary);

 

(iii)         make any principal payment on, or

repurchase, redeem, defease, retire or otherwise acquire for value, prior to

any scheduled principal payment, sinking fund or maturity, any Subordinated

Indebtedness;

 

(iv)         declare or pay any dividend or

distribution on any Equity Interests of any Subsidiary to any Person (other

than the Company or any of its Wholly Owned Restricted Subsidiaries);

 

(v)          incur, create or assume any guarantee

of Indebtedness of any Affiliate (other than a Wholly Owned Restricted

Subsidiary of the Company); or

 

(vi)         make any Investment in any Person

(other than any Permitted Investments)

 

(any of the foregoing payments described in clauses (i) through (vi),

other than any such action that is a Permitted Payment, collectively,

“Restricted Payments”) unless after giving effect to the proposed Restricted

Payment (the amount of any such Restricted Payment, if other than cash, as

determined by the Board of Directors of the Company, whose determination shall

be conclusive and evidenced by a Board Resolution), (1) no Default or

Event of Default shall have occurred and be continuing and such Restricted

Payment shall not be an event which is, or after notice or lapse of time or

both, would be, an “event of default” under the terms of any Indebtedness of

the Company or its Restricted Subsidiaries; and (2) the aggregate amount

of all such Restricted Payments declared or made after the date of this

Indenture does not exceed the sum of:

 

(A)       an amount equal to the Company’s

Cumulative Operating Cash Flow less 1.4 times the Company’s Cumulative

Consolidated Interest Expense;

 

(B)       the aggregate Net Cash Proceeds received

after December 9, 1993 by the Company from capital contributions (other

than from a Subsidiary) or from the issuance or sale (other than to any of its

Subsidiaries) of its Qualified Equity Interests (except, in each case, to the

extent such proceeds are used to purchase, redeem or otherwise retire Equity

Interests or Subordinated Indebtedness as set forth below);  and

 

(C)       to the extent that any Investment

constituting a Restricted Payment (including an Investment in an Unrestricted

Subsidiary) that was made after the date of the Indenture is sold or is

otherwise liquidated or repaid, 100% of the amount (to the extent not included

in Cumulative Operating Cash Flow) equal to the Net Cash

 

112

 

Proceeds or Fair Market Value of marketable securities received with

respect to such Investment (less the cost of the disposition of such Investment

and net of taxes).

 

(b)           Notwithstanding

the foregoing, and in the case of clauses (ii) through (v) below, so long as

there is no Default or Event of Default continuing, the foregoing provisions

shall not prohibit the following actions (clauses (i) through (v) being

referred to as “Permitted Payments”):

 

(i)           the payment of any dividend within 60

days after the date of declaration thereof, if at such date of declaration such

payment would be permitted by the provisions of paragraph (a) of this Section

and such payment shall be deemed to have been paid on such date of declaration

for purposes of the calculation required by paragraph (a) of this Section;

 

(ii)          any transaction with an officer or

director of the Company entered into in the ordinary course of business

(including compensation or employee benefit arrangements with any officer or

director of the Company);

 

(iii)         the repurchase, redemption, or other

acquisition or retirement of any Equity Interests of the Company in exchange

for (including any such exchange pursuant to the exercise of a conversion right

or privilege in connection therewith cash is paid in lieu of the issuance of

fractional shares or scrip), or out of the Net Cash Proceeds of, a

substantially concurrent issue and sale for cash (other than to a Subsidiary)

of other Qualified Equity Interests of the Company; provided that the

Net Cash Proceeds from the issuance of such Qualified Equity Interests are

excluded from clause (2)(B) of paragraph (a) of this Section;

 

(iv)         any repurchase, redemption, defeasance,

retirement, refinancing or acquisition for value or payment of principal of any

Subordinated Indebtedness in exchange for, or out of the net proceeds of, a

substantially concurrent issuance and sale for cash (other than to any

Subsidiary of the Company) of any Qualified Equity Interests of the Company, provided

that the Net Cash Proceeds from the issuance of such Qualified Equity Interests

are excluded from clause (2)(B) of paragraph (a) of this Section; and

 

(v)          the repurchase, redemption,

defeasance, retirement, refinancing or acquisition for value or payment of

principal of any Subordinated Indebtedness (other than Disqualified Equity

Interests) (a “refinancing”) through the issuance of new Subordinated

Indebtedness of the Company, as the case may be, provided that any such

new Indebtedness (1) shall be in a principal amount that does not exceed

the principal amount so refinanced or, if such Subordinated Indebtedness

provides for an amount less than the principal amount thereof to be due and

payable upon a declaration or acceleration thereof, then such lesser amount as

of the date of determination), plus the lesser of (I) the stated amount of

any premium, interest or other payment required to be paid in connection

 

113

 

with such a refinancing pursuant to the terms of the Indebtedness being

refinanced or (II) the amount of premium, interest or other payment

actually paid at such time to refinance the Indebtedness, plus, in either case,

the amount of expenses of the Company incurred in connection with such

refinancing; (2) has an Average Life to Stated Maturity greater than the

remaining Average Life to Stated Maturity of the Securities; (3) has a

Stated Maturity for its final scheduled principal payment later than the Stated

Maturity for the final scheduled principal payment of the Securities; and

(4) is expressly subordinated in right of payment to the Securities at

least to the same extent as the Indebtedness to be refinanced.

 

Section 1010.  Limitation on Transactions with Affiliates.

 

The Company shall not, and shall not permit any of its

Restricted Subsidiaries to, directly or indirectly, enter into or suffer to

exist any transaction or series of related transactions (including, without

limitation, the sale, purchase, exchange or lease of assets, property or

services) with any Affiliate of the Company (other than the Company or a Wholly

Owned Restricted Subsidiary) unless (a) such transaction or series of

transactions is in writing on terms that are no less favorable to the Company

or such Restricted Subsidiary, as the case may be, than would be available in a

comparable transaction in arm’s-length dealings with an unrelated third party

and (b) (i) with respect to any transaction or series of transactions

involving aggregate payments in excess of $1,000,000, the Company delivers an

Officers’ Certificate to the Trustee certifying that such transaction or series

of related transactions complies with clause (a) above and such transaction or

series of related transactions has been approved by a majority of the members

of the Board of Directors of the Company (and approved by a majority of

Independent Directors or, in the event there is only one Independent Director,

by such Independent Director) and (ii) with respect to any transaction or

series of transactions involving aggregate payments in excess of $5,000,000, an

opinion as to the fairness to the Company or such Restricted Subsidiary from a

financial point of view issued by an investment banking or appraisal firm of

national standing.  Notwithstanding the

foregoing, this provision will not apply to (A) any transaction with an

officer or director of the Company entered into in the ordinary course of

business (including compensation or employee benefit arrangements with any

officer or director of the Company), (B) any transaction entered into by

the Company or one of its Wholly Owned Restricted Subsidiaries with a Wholly

Owned Restricted Subsidiary of the Company, and (C) transactions in

existence on the date of this Indenture.

 

Section 1011. 

Limitation on Senior Subordinated Indebtedness.

 

The Company shall not, and shall not permit any

Guarantor to, directly or indirectly, create, incur, issue, assume, guarantee

or otherwise in any manner become directly or indirectly liable for or with

respect to or otherwise permit to exist any Indebtedness that is subordinate in

right of payment to any Indebtedness of the Company

 

114

 

or such Guarantor, as the case may be, unless such Indebtedness is also

pari passu with the Securities or the Guarantee of such Guarantor, or

subordinate in right of payment to the Securities or such Guarantee to at least

the same extent as the Securities or such Guarantee are subordinate in right of

payment to Senior Indebtedness or Guarantor Senior Indebtedness, as the case may

be, as set forth in this Indenture.

 

Section 1012.  Limitation on Liens.

 

The Company shall not, and shall not permit any

Restricted Subsidiary to, directly or indirectly, create, incur, affirm or

suffer to exist any Lien of any kind upon any of its property or assets

(including any intercompany notes), now owned or acquired after the date of

this Indenture, or any income or profits therefrom, except if the Securities

are directly secured equally and ratably with (or prior to in the case of Liens

with respect to Subordinated Indebtedness) the obligation or liability secured

by such Lien, excluding, however, from the operation of the foregoing any of

the following:

 

(a)           any

Lien existing as of the date of this Indenture and listed on Schedule II

hereto;

 

(b)           any

Lien arising by reason of (i) any judgment, decree or order of any court,

so long as such Lien is adequately bonded and any appropriate legal proceedings

which may have been duly initiated for the review of such judgment, decree or

order shall not have been finally terminated or the period within which such

proceedings may be initiated shall not have expired; (ii) taxes not yet

delinquent or which are being contested in good faith; (iii) security for

payment of workers’ compensation or other insurance; (iv) good faith

deposits in connection with tenders, leases, contracts (other than contracts

for the payment of money); (v) zoning restrictions, easements, licenses,

reservations, provisions, covenants, conditions, waivers, restrictions on the

use of property or minor irregularities of title (and with respect to leasehold

interests, mortgages, obligations, liens and other encumbrances incurred,

created, assumed or permitted to exist and arising by, through or under a

landlord or owner of the leased property, with or without consent of the

lessee), none of which materially impairs the use of any parcel of property

material to the operation of the business of the Company or any Subsidiary or

the value of such property for the purpose of such business; (vi) deposits

to secure public or statutory obligations, or in lieu of surety or appeal

bonds; (vii) surveys, exceptions, title defects, encumbrances,

reservations of, or rights of others for, rights of way, sewers, electric

lines, telegraph or telephone lines and other similar purposes or zoning or

other restrictions as to the use of real property not interfering with the

ordinary conduct of the business of the Company or any of its Subsidiaries; or

(viii) operation of law in favor of mechanics, materialmen, laborers,

employees or suppliers, incurred in the ordinary course of business for sums

which are not yet delinquent or are being contested in good faith by

negotiations or by appropriate proceedings which suspend the collection

thereof;

 

115

 

(c)           any

Lien now or hereafter existing on property of the Company or any of its

Restricted Subsidiaries securing Senior Indebtedness or Guarantor Senior

Indebtedness, in each case which Indebtedness is permitted under the provisions

of Section 1008 and provided that the provisions of Section 1014 are complied

with;

 

(d)           any

Lien securing Acquired Indebtedness created prior to (and not created in

connection with or in contemplation of) the incurrence of such Indebtedness by the

Company or any Subsidiary, in each case which Indebtedness is permitted under

the provisions of Section 1008; provided that any such Lien only extends

to the assets that were subject to such Lien securing such Acquired

Indebtedness prior to the related transaction by the Company or its

Subsidiaries;

 

(e)           any

Lien securing Permitted Subsidiary Indebtedness; and

 

(f)            any

extension, renewal, refinancing or replacement, in whole or in part, of any

Lien described in the foregoing clauses (a) through (e) so long as the amount

of security is not increased thereby.

 

Section 1013.  Limitation on Sale of Assets.

 

(a)           The

Company shall not, and shall not permit any of its Restricted Subsidiaries to,

directly or indirectly, consummate an Asset Sale unless (i) at least 80%

of the consideration from such Asset Sale (exclusive of assumed Senior

Indebtedness to which the Company and its Restricted Subsidiaries have received

a full and unconditional release from such liability in connection with such

Asset Sale) is received in cash and (ii) the Company or such Restricted

Subsidiary receives consideration at the time of such Asset Sale at least equal

to the Fair Market Value of the shares or assets sold (other than in the case

of an involuntary Asset Sale, as determined by the Board of Directors of the

Company and evidenced in a Board Resolution or in connection with an Asset

Swap, the Fair Market Value as determined in writing by a nationally recognized

investment banking or appraisal firm); provided, however that, in

the event that the Company or any Restricted Subsidiary engages in an Asset

Sale with any third party and receives in consideration therefor, or

simultaneously with such Asset Sale enters into, a Local Marketing Agreement

with such third party or any affiliate thereof, the Fair Market Value of such

Local Marketing Agreement (as determined in writing by a nationally recognized

investment banking or appraisal firm) shall be deemed cash and considered when

determining whether such Asset Sale complies with the foregoing clauses (i) and

(ii).  Notwithstanding the foregoing,

clause (i) of the preceding sentence shall not be applicable to any Asset Swap.

 

(b)           If

all or a portion of the Net Cash Proceeds of any Asset Sale are not required to

be applied to repay permanently any Senior Indebtedness then outstanding as

required by the terms thereof, or the Company determines not to apply such Net

Cash

 

116

 

Proceeds to the permanent prepayment of such Senior Indebtedness or if

no such Senior Indebtedness is then outstanding, then the Company may, within

12 months of the Asset Sale, invest the Net Cash Proceeds in properties and

assets that (as determined by the Board of Directors) replace the properties

and assets that were the subject of the Asset Sale or in properties and assets

that will be used in the businesses of the Company or its Restricted

Subsidiaries existing on the date of this Indenture or reasonably related

thereto.  The amount of such Net Cash

Proceeds neither used to permanently repay or prepay Senior Indebtedness nor

used or invested as set forth in this paragraph constitutes “Excess Proceeds.”

 

(c)           When

the aggregate amount of Excess Proceeds equals $5,000,000 or more, the Company

shall apply the Excess Proceeds to the repayment of the Securities and any Pari

Passu Indebtedness required to be repurchased under the instrument governing

such Pari Passu Indebtedness as follows: 

(i) the Company shall make an offer to purchase (an “Offer”) from

all Holders of the Securities in accordance with the procedures set forth in

this Indenture in the maximum principal amount (expressed as a multiple of

$1,000) of Securities that may be purchased out of an amount (the “Security

Amount”) equal to the product of such Excess Proceeds multiplied by a fraction,

the numerator of which is the outstanding principal amount of the Securities,

and the denominator of which is the sum of the outstanding principal amount of

the Securities and such Pari Passu Indebtedness (subject to proration in the

event such amount is less than the aggregate Offered Price of all Securities

tendered) and (ii) to the extent required by such Pari Passu Indebtedness

to permanently reduce the principal amount of such Pari Passu Indebtedness, the

Company shall make an offer to purchase or otherwise repurchase or redeem Pari

Passu Indebtedness (a “Pari Passu Offer”) in an amount (the “Pari Passu Debt

Amount”) equal to the excess of the Excess Proceeds over the Security Amount; provided

that in no event shall the Pari Passu Debt Amount exceed the principal amount

of such Pari Passu Indebtedness plus the amount of any premium required to be

paid to repurchase such Pari Passu Indebtedness.  The offer price shall be payable in cash in an amount equal to

100% of the principal amount of the Securities plus accrued and unpaid

interest, if any, to the date (the “Offer Date”) such Offer is consummated (the

“Offered Price”), in accordance with the procedures set forth in this

Indenture.  To the extent that the

aggregate Offered Price of the Securities tendered pursuant to the Offer is

less than the Security Amount relating thereto or the aggregate amount of Pari

Passu Indebtedness that is purchased is less than the Pari Passu Debt Amount

(the amount of such shortfall, if any, constituting a “Deficiency”), the

Company shall use such Deficiency in the business of the Company and its

Restricted Subsidiaries.  Upon

completion of the purchase of all the Securities tendered pursuant to an Offer and

repurchase of the Pari Passu Indebtedness pursuant to a Pari Passu Offer, the

amount of Excess Proceeds, if any, shall be reset at zero.

 

117

 

(d)           Whenever

the Excess Proceeds received by the Company exceed $5,000,000, such Excess

Proceeds shall be set aside by the Company in a separate account pending

(i) deposit with the depositary or a Paying Agent of the amount required

to purchase the Securities or Pari Passu Indebtedness tendered in an Offer or a

Pari Passu Offer, (ii) delivery by the Company of the Offered Price to the

Holders of the Securities or Pari Passu Indebtedness tendered in an Offer or a

Pari Passu Offer and (iii) application, as set forth above, of Excess

Proceeds in the business of the Company and its Restricted Subsidiaries.  Such Excess Proceeds may be invested in

Temporary Cash Investments, provided that the maturity date of any such

investment made after the amount of Excess Proceeds exceeds $5,000,000 shall

not be later than the Offer Date.  The

Company shall be entitled to any interest or dividends accrued, earned or paid

on such Temporary Cash Investments, provided that the Company shall not

withdraw such interest from the separate account if an Event of Default has

occurred and is continuing.

 

(e)           If

the Company becomes obligated to make an Offer pursuant to clause (c) above,

the Securities shall be purchased by the Company, at the option of the Holder

thereof, in whole or in part in integral multiples of $1,000, on a date that is

not earlier than 45 days and not later than 60 days from the date the notice is

given to Holders, or such later date as may be necessary for the Company to

comply with the requirements under the Exchange Act, subject to proration in

the event the Security Amount is less than the aggregate Offered Price of all

Securities tendered.

 

(f)            The

Company shall comply with the applicable tender offer rules, including

Rule 14e-1 under the Exchange Act, and any other applicable securities

laws or regulations in connection with an Offer.

 

(g)           The

Company shall not, and shall not permit any Restricted Subsidiary to, create or

permit to exist or become effective any restriction (other than restrictions

existing under (i) Indebtedness as in effect on the date of this Indenture

and listed on Schedule I hereto as such Indebtedness may be refinanced from

time to time, provided that such restrictions are no less favorable to

the Holders of Securities than those existing on the date of this Indenture or

(ii) any Senior Indebtedness and any Guarantor Senior Indebtedness) that

would materially impair the ability of the Company to make an Offer to purchase

the Securities or, if such Offer is made, to pay for the Securities tendered

for purchase.

 

(h)           Subject

to paragraph (f) above, within 30 days after the date on which the amount of

Excess Proceeds equals or exceeds $5,000,000, the Company shall send or cause

to be sent by first-class mail, postage prepaid, to the Trustee and to each

Holder of the Securities, at his address appearing in the Security Register, a

notice stating or including:

 

118

 

(1)           that the Holder has the right to

require the Company to repurchase, subject to proration, such Holder’s

Securities at the Offered Price;

 

(2)           the Offer Date;

 

(3)           the instructions a Holder must follow

in order to have its Securities purchased in accordance with paragraph (c) of

this Section; and

 

(4)           (i) the most recently filed

Annual Report on Form 10-K (including audited consolidated financial

statements) of the Company, the most recent subsequently filed Quarterly Report

on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent

to such Quarterly Report, other than Current Reports describing Asset Sales

otherwise described in the offering materials (or corresponding successor

reports)(or in the event the Company is not required to prepare any of the

foregoing Forms, the comparable information required pursuant to

Section 1020), (ii) a description of material developments in the

Company’s business subsequent to the date of the latest of such Reports,

(iii) if material, appropriate pro forma financial information, and

(iv) such other information, if any, concerning the business of the

Company which the Company in good faith believes will enable such Holders to

make an informed investment decision.

 

(i)            Holders

electing to have Securities purchased hereunder will be required to surrender

such Securities at the address specified in the notice at least three Business

Days prior to the Offer Date.  Holders

will be entitled to withdraw their election to have their Securities purchased

pursuant to this Section 1013 if the Company receives, not later than three

Business Days prior to the Offer Date, a telegram, telex, facsimile

transmission or letter setting forth (1) the name of the Holder,

(2) the certificate number of the Security in respect of which such notice

of withdrawal is being submitted, (3) the principal amount of the Security

(which shall be $1,000 or an integral multiple thereof) delivered for purchase

by the Holder as to which his election is to be withdrawn, (4) a statement

that such Holder is withdrawing his election to have such principal amount of

such Security purchased, and (5) the principal amount, if any, of such

Security (which shall be $1,000 or an integral multiple thereof) that remains

subject to the original notice of the Offer and that has been or will be

delivered for purchase by the Company.

 

(j)            The

Company shall (i) not later than the Offer Date, accept for payment

Securities or portions thereof tendered pursuant to the Offer, (ii) not

later than 10:00 a.m. (New York City time) on the Offer Date, deposit with the

Trustee or with a Paying Agent (or, if the Company is acting as its own Paying

Agent, segregate and hold in trust as provided in Section 1003) an amount of

money in same day funds (or New York Clearing House funds if such deposit is

made prior to the Offer Date) sufficient to pay the aggregate Offered Price of

all the Securities or portions thereof which are to be

 

119

 

purchased on that date and (iii) not later than the Offer Date,

deliver to the Paying Agent (if other than the Company) an Officers’

Certificate stating the Securities or portions thereof accepted for payment by

the Company.

 

Subject to applicable escheat laws, as provided in the

Securities, the Trustee and the Paying Agent shall return to the Company any

cash that remains unclaimed, together with interest, if any, thereon, held by

them for the payment of the Offered Price; provided, however,

that (x) to the extent that the aggregate amount of cash deposited by the

Company with the Trustee in respect of an Offer exceeds the aggregate Offered

Price of the Securities or portions thereof to be purchased, the Trustee shall

hold such excess for the Company and (y) unless otherwise directed by the

Company in writing, promptly after the Business Day following the Offer Date

the Trustee shall return any such excess to the Company together with interest

or dividends, if any, thereon.

 

(k)           Securities

to be purchased shall, on the Offer Date, become due and payable at the Offered

Price and from and after such date (unless the Company shall default in the

payment of the Offered Price) such Securities shall cease to bear interest.  Such Offered Price shall be paid to such

Holder promptly following the later of the Offer Date and the time of delivery

of such Security to the relevant Paying Agent at the office of such Paying

Agent by the Holder thereof in the manner required.  Upon surrender of any such Security for purchase in accordance

with the foregoing provisions, such Security shall be paid by the Company at

the Offered Price; provided, however, that installments of

interest whose Stated Maturity is on or prior to the Offer Date shall be payable

to the Holders of such Securities, or one or more Predecessor Securities,

registered as such on the relevant Regular Record Dates according to the terms

and the provisions of Section 309; provided, further, that

Securities to be purchased are subject to proration in the event the Excess

Proceeds are less than the aggregate Offered Price of all Securities tendered

for purchase, with such adjustments as may be appropriate by the Trustee so

that only Securities in denominations of $1,000 or integral multiples thereof,

shall be purchased.  If any Security

tendered for purchase shall not be so paid upon surrender thereof by deposit of

funds with the Trustee or a Paying Agent in accordance with paragraph (j)

above, the principal thereof shall, until paid, bear interest from the Offer

Date at the rate borne by such Security. 

Any Security that is to be purchased only in part shall be surrendered

to a Paying Agent at the office of such Paying Agent (with, if the Company, the

Security Registrar or the Trustee so requires, due endorsement by, or a written

instrument of transfer in form satisfactory to the Company and the Security

Registrar or the Trustee duly executed by, the Holder thereof 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, one or more new Securities of any authorized denomination as

requested by such Holder in an aggregate principal amount equal to, and in exchange

for, the portion of the principal amount of the Security so surrendered that is

not purchased.

 

120

 

Section 1014. 

Limitation on Issuances of Guarantees of and Pledges for Indebtedness.

 

(a)           The

Company shall not permit any Restricted Subsidiary, other than the Guarantors,

directly or indirectly, to secure the payment of any Senior Indebtedness of the

Company and the Company will not, and will not permit any Restricted Subsidiary

to, pledge any intercompany notes representing obligations of any Restricted

Subsidiary (other than the Guarantors) to secure the payment of any Senior

Indebtedness unless in each case such Restricted Subsidiary simultaneously

executes and delivers a supplemental indenture to this Indenture providing for

a guarantee of payment of the Securities by such Restricted Subsidiary, which

guarantee shall be on the same terms as the guarantee of the Senior

Indebtedness (if a guarantee of Senior Indebtedness is granted by any such

Restricted Subsidiary) except that the guarantee of the Securities need not be

secured and shall be subordinated to the claims against such Restricted

Subsidiary in respect of Senior Indebtedness to the same extent as the

Securities are subordinated to Senior Indebtedness of the Company under this

Indenture.

 

(b)           The

Company shall not permit any Restricted Subsidiary, other than the Guarantors,

directly or indirectly, to guarantee, assume or in any other manner become

liable with respect to any Indebtedness of the Company (other than guarantees

in existence on the date of the Indenture) unless such Restricted Subsidiary

simultaneously executes and delivers a supplemental indenture to this Indenture

providing for a guarantee of the Securities on the same terms as the guarantee

of such Indebtedness except that if the Securities are subordinated in right of

payment to such Indebtedness, the guarantee under the supplemental indenture

shall be subordinated to the guarantee of such Indebtedness to the same extent

as the Securities are subordinated to such Indebtedness under this Indenture.

 

(c)           Each

guarantee created pursuant to the provisions described in the foregoing

paragraph is referred to as a “Guarantee” and the issuer of each such Guarantee

is referred to as a “Guarantor.” 

Notwithstanding the foregoing, any Guarantee by a Restricted Subsidiary

of the Securities shall provide by its terms that it shall be automatically and

unconditionally released and discharged upon (i) any sale, exchange or

transfer, to any Person not an Affiliate of the Company, of all of the

Company’s Equity Interest in, or all or substantially all the assets of, such

Restricted Subsidiary, which is in compliance with this Indenture or

(ii) (with respect to any Guarantees created after the date of this

Indenture) the release by the holders of the Indebtedness of the Company

described in clauses (a) and (b) above of their security interest or their

guarantee by such Restricted Subsidiary (including any deemed release upon

payment in full of all obligations under such Indebtedness), at a time when

(A) no other Indebtedness of the Company has been secured or guaranteed by

such Restricted Subsidiary, as the case may be, or (B) the holders of all

such other Indebtedness which is secured or guaranteed by

 

121

 

such Restricted Subsidiary also release their security interest in, or

guarantee by, such Restricted Subsidiary (including any deemed release upon

payment in full of all obligations under such Indebtedness).

 

Section 1015.  Restriction on Transfer of Assets.

 

The Company and the Guarantors shall not sell, convey,

transfer or otherwise dispose of their respective assets or property to any of

the Company’s Restricted Subsidiaries (other than any Guarantor), except for

sales, conveyances, transfers or other dispositions made in the ordinary course

of business and except for capital contributions to any Restricted Subsidiary,

the only material assets of which are broadcast licenses.  For purposes of this provision, any sale,

conveyance, transfer, lease or other disposition of property or assets, having

a Fair Market Value in excess of (a) $1,000,000 for any sale, conveyance,

transfer, lease or disposition or series of related sales, conveyances, transfers,

leases and dispositions and (b) $5,000,000 in the aggregate for all such

sales, conveyances, transfers, leases or dispositions in any fiscal year of the

Company shall not be considered “in the ordinary course of business.”

 

Section 1016. 

Purchase of Securities upon a Change of

Control.

 

(a)           If

a Change of Control shall occur at any time, then each Holder of Securities

shall have the right to require that the Company purchase such Holder’s

Securities in whole or in part in integral multiples of $1,000, at a purchase

price (the “Change of Control Purchase Price”) in cash in an amount equal to

101% of the principal amount of such Securities, plus accrued and unpaid

interest, if any, to the date of purchase (the “Change of Control Purchase

Date”), pursuant to the offer described in subsection (c) of this Section (the

“Change of Control Offer”) and in accordance with the procedures set forth in

Subsections (b), (c), (d) and (e) of this Section.

 

(b)           Within

30 days following any Change of Control, the Company shall notify the Trustee

thereof and give written notice (a “Change of Control Purchase Notice”) of such

Change of Control to each Holder by first-class mail, postage prepaid, at his

address appearing in the Security Register stating or including:

 

(1)           that a Change of Control has

occurred, the date of such event, and that such Holder has the right to require

the Company to repurchase such Holder’s Securities at the Change of Control

Purchase Price;

 

(2)           the circumstances and relevant facts

regarding such Change of Control (including but not limited to information with

respect to pro forma historical income, cash flow and capitalization after

giving effect to such Change of Control);

 

122

 

(3)           (i) the most recently filed

Annual Report on Form 10-K (including audited consolidated financial

statements) of the Company, the most recent subsequently filed Quarterly Report

on Form 10-Q, as applicable, and any Current Report on Form 8-K of the Company

filed subsequent to such Quarterly Report (or in the event the Company is not

required to prepare any of the foregoing Forms, the comparable information

required to be prepared by the Company and any Guarantor pursuant to

Section 1020), (ii) a description of material developments in the

Company’s business subsequent to the date of the latest of such reports and

(iii) such other information, if any, concerning the business of the

Company which the Company in good faith believes will enable such Holders to

make an informed investment decision;

 

(4)           that the Change of Control Offer is

being made pursuant to this Section 1016(a) and that all Securities properly

tendered pursuant to the Change of Control Offer will be accepted for payment

at the Change of Control Purchase Price;

 

(5)           the Change of Control Purchase Date

which shall be a Business Day no earlier than 30 days nor later than 60 days

from the date such notice is mailed, or such later date as is necessary to

comply with requirements under the Exchange Act;

 

(6)           the Change of Control Purchase Price;

 

(7)           the names and addresses of the Paying

Agent and the offices or agencies referred to in Section 1002;

 

(8)           that Securities must be surrendered

on or prior to the Change of Control Purchase Date to the Paying Agent at the

office of the Paying Agent or to an office or agency referred to in Section

1002 to collect payment;

 

(9)           that the Change of Control Purchase

Price for any Security which has been properly tendered and not withdrawn will

be paid promptly following the Change of Control Offer Purchase Date;

 

(10)         the procedures for withdrawing a tender

of Securities and Change of Control Purchase Notice;

 

(11)         that any Security not tendered will

continue to accrue interest; and

 

(12)         that, unless the Company defaults in

the payment of the Change of Control Purchase Price, any Security accepted for

payment

 

123

 

pursuant to the Change of Control Offer shall cease to

accrue interest after the Change of Control Purchase Date.

 

(c)           Upon

receipt by the Company of the proper tender of Securities, the Holder of the

Security in respect of which such proper tender was made shall (unless the

tender of such Security is properly withdrawn) thereafter be entitled to

receive solely the Change of Control Purchase Price with respect to such

Security.  Upon surrender of any such

Security for purchase in accordance with the foregoing provisions, such

Security shall be paid by the Company at the Change of Control Purchase Price; provided,

however, that installments of interest whose Stated Maturity is on or

prior to the Change of Control Purchase Date shall be payable to the Holders of

such Securities, or one or more Predecessor Securities, registered as such on

the relevant Regular Record Dates according to the terms and the provisions of

Section 309.  If any Security tendered

for purchase shall not be so paid upon surrender thereof, the principal thereof

(and premium, if any, thereon) shall, until paid, bear interest from the Change

of Control Purchase Date at the rate borne by such Security.  Holders electing to have Securities

purchased will be required to surrender such Securities to the Paying Agent at

the address specified in the Change of Control Purchase Notice at least two

Business Days prior to the Change of Control Purchase Date.  Any Security that is to be purchased only in

part shall be surrendered to a Paying Agent at the office of such Paying Agent

(with, if the Company, the Security Registrar or the Trustee so requires, due

endorsement by, or a written instrument of transfer in form satisfactory to the

Company and the Security Registrar or the Trustee, as the case may be, duly

executed by, the Holder thereof 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, one or more new

Securities of any authorized denomination as requested by such Holder in an

aggregate principal amount equal to, and in exchange for, the portion of the

principal amount of the Security so surrendered that is not purchased.

 

(d)           The

Company shall (i) not later than the Change of Control Purchase Date,

accept for payment Securities or portions thereof tendered pursuant to the

Change of Control Offer, (ii) not later than 11:00 a.m. (New York City

time) on the Change of Control Purchase Date, deposit with the Paying Agent an

amount of cash sufficient to pay the aggregate Change of Control Purchase Price

of all the Securities or portions thereof which are to be purchased as of the

Change of Control Purchase Date and (iii) not later than the Change of

Control Purchase Date, deliver to the Paying Agent an Officers’ Certificate

stating the Securities or portions thereof accepted for payment by the Company.  The Paying Agent shall promptly mail or

deliver to Holders of Securities so accepted payment in an amount equal to the

Change of Control Purchase Price of the Securities purchased from each such

Holder, and the Company shall execute and the Trustee shall promptly

authenticate and mail or deliver to such Holders a new Security equal in

principal amount to any unpurchased portion of the Security surrendered.  Any

 

124

 

Securities not so accepted shall be promptly mailed or delivered by the

Paying Agent at the Company’s expense to the Holder thereof.  The Company will publicly announce the

results of the Change of Control Offer on the Change of Control Purchase Date.  For purposes of this Section 1016, the

Company shall choose a Paying Agent which shall not be the Company.

 

(e)           A

Change of Control Purchase Notice may be withdrawn before or after delivery by

the Holder to the Paying Agent at the office of the Paying Agent of the

Security to which such Change of Control Purchase Notice relates, by means of a

written notice of withdrawal delivered by the Holder to the Paying Agent at the

office of the Paying Agent or to the office or agency referred to in Section

1002 to which the related Change of Control Purchase Notice was delivered not

later than three Business Days prior to the Change of Control Purchase Date

specifying, as applicable:

 

(1)           the name of the Holder;

 

(2)           the certificate number of the

Security in respect of which such notice of withdrawal is being submitted;

 

(3)           the principal amount of the Security

(which shall be $1,000 or an integral multiple thereof) delivered for purchase

by the Holder as to which such notice of withdrawal is being submitted; and

 

(4)           the principal amount, if any, of such

Security (which shall be $1,000 or an integral multiple thereof) that remains

subject to the original Change of Control Purchase Notice and that has been or

will be delivered for purchase by the Company.

 

(f)            Subject

to applicable escheat laws, as provided in the Securities, the Trustee and the

Paying Agent shall return to the Company any cash that remains unclaimed,

together with interest or dividends, if any, thereon, held by them for the

payment of the Change of Control Purchase Price; provided, however,

that (x) to the extent that the aggregate amount of cash deposited by the

Company pursuant to clause (ii) of paragraph (d) above exceeds the aggregate

Change of Control Purchase Price of the Securities or portions thereof to be

purchased, then the Trustee shall hold such excess for the Company and

(y) unless otherwise directed by the Company in writing, promptly after

the Business Day following the Change of Control Purchase Date the Trustee

shall return any such excess to the Company together with interest, if any,

thereon.

 

(g)           The

Company shall comply with the applicable tender offer rules, including Rule

14e-1 under the Exchange Act, and any other applicable securities laws or

regulations in connection with a Change of Control Offer.

 

125

 

Section 1017.  Limitation on Subsidiary Equity

Interests.

 

The Company shall not permit any Restricted Subsidiary

of the Company to issue any Equity Interests, except for (a) Equity

Interests issued to and held by the Company or a Wholly Owned Restricted

Subsidiary, and (b) Equity Interests issued by a Person prior to the time

(A) such Person becomes a Restricted Subsidiary, (B) such Person

merges with or into a Restricted Subsidiary or (C) a Restricted Subsidiary

merges with or into such Person; provided that such Equity Interests

were not issued or incurred by such Person in anticipation of the type of

transaction contemplated by subclause (A), (B) or (C).

 

Section 1018. 

Limitation on Dividends and Other Payment Restrictions Affecting

Subsidiaries.

 

The Company shall not, and shall not permit any of its

Restricted Subsidiaries to, directly or indirectly, create or otherwise cause

or suffer to exist or become effective any encumbrance or restriction on the

ability of any Restricted Subsidiary of the Company to (i) pay dividends

or make any other distribution on its Equity Interests, (ii) pay any

Indebtedness owed to the Company or a Restricted Subsidiary of the Company,

(iii) make any Investment in the Company or a Restricted Subsidiary of the

Company or (iv) transfer any of its properties or assets to the Company or

any Restricted Subsidiary, except (a) any encumbrance or restriction

pursuant to an agreement in effect on the date of this Indenture and listed on

Schedule III hereto or contained in any other indenture or instrument governing

debt or preferred securities that are no more restrictive than those contained

in the Indenture; (b) any encumbrance or restriction, with respect to a

Restricted Subsidiary that is not a Subsidiary of the Company on the date of

this Indenture, in existence at the time such Person becomes a Restricted

Subsidiary of the Company and not incurred in connection with, or in

contemplation of, such Person becoming a Restricted Subsidiary; (c) any encumbrance

or restriction existing under any agreement that extends, renews, refinances or

replaces the agreements containing the encumbrances or restrictions in the

foregoing clauses (a) and (b), or in this clause (c), provided that the

terms and conditions of any such encumbrances or restrictions are not

materially less favorable to the Holders of the Securities than those under or

pursuant to the agreement evidencing the Indebtedness so extended, renewed,

refinanced or replaced or are not more restrictive than those set forth in this

Indenture; and (d) any encumbrance or restriction created pursuant to an

asset sale agreement, stock sale agreement or similar instrument pursuant to

which an Asset Sale permitted under Section 1013 is to be consummated, so long

as such restriction or encumbrance shall be effective only for a period from

the execution and delivery of such agreement or instrument through a

termination date not later than 270 days after such execution and delivery.

 

126

 

Section 1019.  Limitation on Unrestricted Subsidiaries.

 

The Company shall not make, and shall not permit any

of its Restricted Subsidiaries to make, any Investments in Unrestricted

Subsidiaries if, at the time thereof, the aggregate amount of such Investments

would exceed the amount of Restricted Payments then permitted to be made

pursuant to Section 1009.  Any

Investments in Unrestricted Subsidiaries permitted to be made pursuant to this

covenant (i) will be treated as the payment of a Restricted Payment in

calculating the amount of Restricted Payments made by the Company and

(ii) may be made in cash or property.

 

Section 1020. 

Provision of Financial Statements.

 

Whether or not the Company is subject to Section 13(a)

or 15(d) of the Exchange Act, the Company shall, to the extent permitted under

the Exchange Act, file with the Commission the annual reports, quarterly

reports and other documents which the Company would have been required to file

with the Commission pursuant to such Sections 13(a) or 15(d) if the Company

were so subject, such documents to be filed with the Commission on or prior to

the respective dates (the “Required Filing Dates”) by which the Company would

have been required so to file such documents if the Company were so

subject.  The Company will also in any

event (x) within 15 days of each Required Filing Date (i) transmit by

mail to all Holders, as their names and addresses appear in the Security

Register, without cost to such Holders and (ii) file with the Trustee

copies of the annual reports, quarterly reports and other documents which the

Company would have been required to file with the Commission pursuant to

Section 13(a) or 15(d) of the Exchange Act if the Company were subject to such

Sections and (y) if filing such documents by the Company with the

Commission is not permitted under the Exchange Act, promptly upon written

request and payment of the reasonable cost of duplication and delivery, supply

copies of such documents to any prospective Holder at the Company’s cost.  So long as any of the Securities remain

outstanding, the Company will make available to any prospective purchaser of

Securities or beneficial owner of Securities in connection with any sale of

Securities the information required by Rule 144A(d)(4) under the Securities

Act, until such time as the Company has either exchanged the Securities for

securities identical in all material respects which have been registered under

the Securities Act or until such time as the holders of Securities have disposed

of such Securities pursuant to an effective registration statement under the

Securities Act.

 

Section 1021. 

Statement by Officers as to Default.

 

(a)           The

Company will deliver to the Trustee, on or before a date not more than 60 days

after the end of each fiscal quarter and not more than 120 days after the end

of each fiscal year of the Company ending after the date hereof, a written

statement signed by two executive officers of the Company, one of whom shall be

the principal executive officer, principal financial officer or principal

accounting officer of

 

127

 

the Company, stating whether or not, after a review of the activities

of the Company during such year or such quarter and of the Company’s performance

under this Indenture, to the best knowledge, based on such review, of the

signers thereof, the Company has fulfilled all its obligations and is in

compliance with all conditions and covenants under this Indenture throughout

such year or quarter, as the case may be, and, if there has been a Default

specifying each Default and the nature and status thereof.

 

(b)           When

any Default or Event of Default has occurred and is continuing, or if the

Trustee or any Holder or the trustee for or the holder of any other evidence of

Indebtedness of the Company or any Subsidiary gives any notice or takes any

other action with respect to a claimed default (other than with respect to

Indebtedness in the principal amount of less than $5,000,000), the Company

shall deliver to the Trustee by registered or certified mail or by telegram,

telex or facsimile transmission followed by hard copy an Officers’ Certificate

specifying such Default, Event of Default, notice or other action within five

Business Days of its occurrence.

 

Section 1022.  Waiver of Certain Covenants.

 

The Company or any Guarantor may omit in any

particular instance to comply with any term, provision or condition set forth

in Sections 1006 through 1012, 1014, 1015 and 1017 through 1020, if, before or

after the time for such compliance, the Holders of not less than a majority in

aggregate principal amount of the Securities at the time Outstanding shall, by

Act of such Holders, waive such compliance in such instance with such covenant

or condition, but no such waiver shall extend to or affect such covenant or

condition except to the extent so expressly waived, and, until such waiver

shall become effective, the obligations of the Company and the duties of the

Trustee in respect of any such covenant or condition shall remain in full force

and effect.

 

ARTICLE ELEVEN

 

REDEMPTION OF SECURITIES

 

Section 1101. 

Rights of Redemption.

 

(a)           The

Securities may be redeemed, at the Company’s option, in whole or from time to

time in part, at any time on or after March 15, 2007, upon not less than 30 nor

more than 60 days’ prior notice by first class mail to each Holder of

Securities to be redeemed at its address appearing in the Security Register and

prior to Maturity at the following redemption prices (“Redemption Prices”), expressed

as percentages of the principal amount, plus accrued interest to the dated

fixed for such redemption (the “Redemption Date”), subject to the right of

Holders of record on the relevant Regular

 

128

 

Record Date to receive interest due on an Interest Payment Date that is

on or prior to the Redemption Date.  If

less than all of the Securities are to be redeemed, the Trustee shall select

the Securities or portions thereof to be redeemed pro rata, by lot or by any

other method the Trustee shall deem fair and reasonable.

 

(b)           If

redeemed during the twelve-month period beginning March 15, in the year

indicated, the Redemption Price shall be:

 

	

  

  Year

  	

   

  	

  Redemption

  Price

  	

   

  
	

  2007

  	

   

  	

  104.000

  	

  %

  
	

  2008

  	

   

  	

  102.667

  	

  %

  
	

  2009

  	

   

  	

  101.333

  	

  %

  
					

 

and thereafter 100% of the principal amount, in each case together with

accrued and unpaid interest, if any, to the Redemption Date (subject to the

right of the Holders of record on relevant record dates to receive interest due

on an Interest Payment Date).

 

(c)           At

any time on or prior to March 15, 2005, the Company may redeem up to 25% of the

principal amount of Securities issued under the Indenture with the net proceeds

of a Public Equity Offering of the Company at 108.000% of the aggregate principal

amount, together with accrued and unpaid interest, if any, to the Redemption

Date (subject to the right of Holders of record on relevant record dates to

receive interest due on an Interest Payment Date).”

 

Section 1102. 

Applicability of Article.

 

Redemption of Securities at the election of the

Company or otherwise, as permitted or required by any provision of this

Indenture, shall be made in accordance with such provision and this Article.

 

Section 1103. 

Election to Redeem; Notice to Trustee.

 

The election of the Company to redeem any Securities

pursuant to Section 1101 shall be evidenced by a Company Order and an Officers’

Certificate.  In case of any redemption

at the election of the Company, the Company shall, not less than 45 nor more

than 60 days prior to the Redemption Date fixed by the Company (unless a

shorter notice period shall be satisfactory to the Trustee), notify the Trustee

in writing of such Redemption Date and of the principal amount of Securities to

be redeemed.

 

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Section 1104.  Selection by Trustee of Securities to

Be Redeemed.

 

If less than all the Securities are to be redeemed,

the particular Securities or portions thereof to be redeemed shall be selected

not more than 30 days prior to the Redemption Date by the Trustee, from the

Outstanding Securities not previously called for redemption, pro rata, by lot

or such other method as the Trustee shall deem fair and reasonable, and the

amounts to be redeemed may be equal to $1,000 or any integral multiple thereof.

 

The Trustee shall promptly notify the Company and the

Security Registrar in writing of the Securities selected for redemption and, in

the case of any Securities selected for partial redemption, the principal

amount thereof to be redeemed.

 

For all purposes of this Indenture, unless the context

otherwise requires, all provisions relating to redemption of Securities shall

relate, in the case of any Security redeemed or to be redeemed only in part, to

the portion of the principal amount of such Security which has been or is to be

redeemed.

 

Section 1105. 

Notice of Redemption.

 

Notice of redemption shall be given by first-class

mail, postage prepaid, mailed not less than 30 nor more than 60 days prior

to the Redemption Date, to each Holder of Securities to be redeemed, at his

address appearing in the Security Register.

 

All notices of redemption shall state:

 

(a)           the

Redemption Date;

 

(b)           the

Redemption Price;

 

(c)           if

less than all Outstanding Securities are to be redeemed, the identification of

the particular Securities to be redeemed;

 

(d)           in

the case of a Security to be redeemed in part, the principal amount of such

Security to be redeemed and that after the Redemption Date upon surrender of

such Security, new Security or Securities in the aggregate principal amount

equal to the unredeemed portion thereof will be issued;

 

(e)           that

Securities called for redemption must be surrendered to the Paying Agent to

collect the Redemption Price;

 

(f)            that

on the Redemption Date the Redemption Price will become due and payable upon

each such Security or portion thereof, and that (unless the Company 

 

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shall default in payment of the Redemption Price) interest thereon

shall cease to accrue on and after said date;

 

(g)           the

place or places where such Securities are to be surrendered for payment of the

Redemption Price; and

 

(h)           the

CUSIP number, if any, relating to such Securities.

 

Notice of redemption of Securities to be redeemed at

the election of the Company shall be given by the Company or, at the Company’s

written request, by the Trustee in the name and at the expense of the Company.

 

The notice if mailed in the manner herein provided

shall be conclusively presumed to have been given, whether or not the Holder

receives such notice.  In any case,

failure to give such notice to any Holder of any Security designated for

redemption as a whole or in part, or any defect in any such notice, shall not

affect the validity of the proceedings for the redemption of any other

Security.

 

Section 1106.  Deposit of Redemption Price.

 

On or prior to any Redemption Date, the Company shall

deposit with the Trustee or with a Paying Agent (or, if the Company is acting

as its own Paying Agent, segregate and hold in trust as provided in Section

1003) an amount of money in same day funds sufficient to pay the Redemption

Price of and (except if the Redemption Date shall be an Interest Payment Date)

accrued interest on, all the Securities or portions thereof which are to be

redeemed on that date.  When the

Redemption Date falls on an Interest Payment Date, payments of interest due on

such date are to be paid as provided hereunder as if no such redemption were

occurring.

 

Section 1107. 

Securities Payable on Redemption Date.

 

Notice of redemption having been given as aforesaid,

the Securities so to be redeemed shall, on the Redemption Date, become due and

payable at the Redemption Price therein specified and from and after such date

(unless the Company shall default in the payment of the Redemption Price and

accrued interest) such Securities shall cease to bear interest.  Upon surrender of any such Security for

redemption in accordance with said notice, such Security shall be paid by the

Company at the Redemption Price together with accrued interest to the

Redemption Date; provided, however, that installments of interest

whose Stated Maturity is on or prior to the Redemption Date shall be payable to

the Holders of such Securities, or one or more Predecessor Securities, registered

as such on the relevant Regular Record Dates according to the terms and the

provisions of Section 309.

 

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If any Security called for redemption shall not be so

paid upon surrender thereof for redemption, the principal and premium, if any,

shall, until paid, bear interest from the Redemption Date at the rate borne by

such Security.

 

Section 1108. 

Securities Redeemed or Purchased in Part.

 

Any Security which is to be redeemed or purchased only

in part shall be surrendered to the Paying Agent at the office or agency

maintained for such purpose pursuant to Section 1002 (with, if the Company, the

Security Registrar or the Trustee so requires, due endorsement by, or a written

instrument of transfer in form satisfactory to the Company, the Security

Registrar or the Trustee duly executed by, the Holder thereof 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 unredeemed portion of the principal of the Security so surrendered

that is not redeemed or purchased.

 

ARTICLE TWELVE

 

SUBORDINATION OF

SECURITIES

 

Section 1201. 

Securities Subordinate to Senior Indebtedness.

 

The Company covenants and agrees, and each Holder of a

Security, by his acceptance thereof, likewise covenants and agrees, that, to

the extent and in the manner hereinafter set forth in this Article, the

Indebtedness represented by the Securities and the payment of the principal of,

premium, if any, and interest on each and all of the Securities and all other Indenture

Obligations are hereby expressly made subordinate and subject in right of

payment as provided in the Indenture to the prior payment in full, in cash or

Cash Equivalents or in any other form as acceptable to the holders of Senior

Indebtedness, of all Senior Indebtedness, whether outstanding on the date of

the Indenture or thereafter incurred.

 

This Article Twelve shall constitute a continuing

offer to all Persons who, in reliance upon such provisions, become holders of,

or continue to hold Senior Indebtedness; and such provisions are made for the

benefit of the holders of Senior Indebtedness; and such holders are made

obligees hereunder and they or each of them may enforce such provisions.

 

Section 1202.  Payment Over of Proceeds Upon

Dissolution, etc.

 

In the event of

(a) any insolvency or bankruptcy case or proceeding, or any receivership,

liquidation, reorganization or other similar case or proceeding in connection

 

132

 

therewith, relative to the Company or to its creditors, as such, or to

its assets, or (b) any liquidation, dissolution or other winding up of the

Company, whether voluntary or involuntary and whether or not involving

insolvency or bankruptcy, or (c) any assignment for the benefit of creditors

or any other marshaling of assets or liabilities of the Company, then and in

any such event:

 

(1)           the

holders of Senior Indebtedness shall be entitled to receive payment in full in

cash or Cash Equivalents or in any other form as acceptable to the holders of

Senior Indebtedness, of all amounts due on or in respect of all Senior

Indebtedness, before the Holders of the Securities are entitled to receive any

payment or distribution of any kind or character (excluding Permitted Junior

Securities) on account of the principal of, premium, if any, or interest on the

Securities or any other Indenture Obligations; and

 

(2)           any

payment or distribution of assets of the Company of any kind or character,

whether in cash, property or securities (excluding Permitted Junior

Securities), by set-off or otherwise, to which the Holders or the Trustee would

be entitled but for the provisions of this Article shall be paid by the

liquidating trustee or agent or other Person making such payment or

distribution, whether a trustee in bankruptcy, a receiver or liquidating

trustee or otherwise, directly to the holders of Senior Indebtedness or their

representative or representatives or to the trustee or trustees under any

indenture under which any instruments evidencing any of such Senior

Indebtedness may have been issued, ratably according to the aggregate amounts

remaining unpaid on account of the Senior Indebtedness held or represented by

each, to the extent necessary to make payment in full in cash or Cash

Equivalents or in any other form as acceptable to the Holders of Senior

Indebtedness, of all Senior Indebtedness remaining unpaid, after giving effect

to any concurrent payment or distribution to the holders of such Senior

Indebtedness; and

 

(3)           in

the event that, notwithstanding the foregoing provisions of this Section, the

Trustee or the Holder of any Security shall have received any payment or

distribution of assets of the Company of any kind or character, whether in

cash, property or securities, in respect of principal, premium, if any, and

interest on the Securities or any other Indenture Obligations before all Senior

Indebtedness is paid in full, then and in such event such payment or

distribution (excluding Permitted Junior Securities) shall be paid over or

delivered forthwith to the trustee in bankruptcy, receiver, liquidating

trustee, custodian, assignee, agent or other person making payment or

distribution of assets of the Company for application to the payment of all

Senior Indebtedness remaining unpaid, to the extent necessary to pay all Senior

Indebtedness in full in cash or Cash Equivalents or in any other form as

acceptable to the Holders of Senior Indebtedness, after giving effect to any

concurrent payment or distribution to or for the holders of Senior Indebtedness.

 

The consolidation of the Company with, or the merger

of the Company with or into, another Person or the liquidation or dissolution

of the Company following the sale,

 

133

 

assignment, conveyance, transfer, lease or other disposal of all or

substantially all of the Company’s properties or assets to another Person upon

the terms and conditions set forth in Article Eight shall not be deemed a

dissolution, winding up, liquidation, reorganization, assignment for the

benefit of creditors or marshaling of assets and liabilities of the Company for

the purposes of this Section if the Person formed by such consolidation or the

surviving entity of such merger or the Person which acquires by sale,

assignment, conveyance, transfer, lease or other disposal of all or

substantially all of the Company’s properties or assets, as the case may be,

shall, as a part of such consolidation, merger, sale, assignment, conveyance,

transfer, lease or other disposal, comply with the conditions set forth in

Article Eight.

 

Section 1203. 

Suspension of Payment When Senior

Indebtedness in Default.

 

(a)           Unless

Section 1202 shall be applicable, upon the occurrence of a Payment Default, no

payment (other than any payments previously made pursuant to the provisions

described in Article Four) or distribution of any assets of the Company of any

kind or character (excluding Permitted Junior Securities) shall be made by the

Company on account of principal of, premium, if any, or interest on, the Securities

or any other Indenture Obligations or on account of the purchase, redemption,

defeasance (whether under Section 402 or 403) or other acquisition of or in

respect of the Securities unless and until such Payment Default shall have been

cured or waived or shall have ceased to exist or the Designated Senior

Indebtedness with respect to which such Payment Default shall have occurred

shall have been discharged or paid in full in cash or Cash Equivalents or in

any other form as acceptable to the Holders of Senior Indebtedness, after which

the Company shall resume making any and all required payments in respect of the

Securities, including any missed payments.

 

(b)           Unless

Section 1202 shall be applicable, upon (1) the occurrence of a Non-payment

Default and (2) after receipt by the Trustee and the Company from a

representative of the holders of any Designated Senior Indebtedness (a “Senior

Representative”) of written notice of such occurrence, no payment (other than

any payments previously made pursuant to the provisions described in Article

Four) or distribution of any assets of the Company of any kind or character

(excluding Permitted Junior Securities) shall be made by the Company on account

of any principal of, premium, if any, or interest on, the Securities or any

other Indenture Obligations or on account of the purchase, redemption,

defeasance or other acquisition of or in respect of Securities for a period

(“Payment Blockage Period”) commencing on the date of receipt by the Trustee of

such notice unless and until the earliest of (subject to any blockage of

payments that may then or thereafter be in effect under subsection (a) of this

Section 1203) (x) 179 days having elapsed since receipt of such

written notice by the Trustee (provided any Designated Senior Indebtedness as

to which notice was given shall theretofore have not been accelerated),

(y) the date such Non-payment Default and all

 

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other Non-payment Defaults as to which notice is also given after such

period is initiated shall have been cured or waived or shall have ceased to

exist or the Designated Senior Indebtedness related thereto shall have been

discharged or paid in full in cash or Cash Equivalents or in any other form as

acceptable to the Holders of Designated Senior Indebtedness, or (z) the

date on which such Payment Blockage Period (and all Non-payment Defaults as to

which notice is given after such Payment Blockage Period is initiated) shall

have been terminated by written notice to the Company or the Trustee from the

representative of holders of Designated Senior Indebtedness, or the holders of

at least a majority of the Designated Senior Indebtedness, that initiated such

Payment Blockage Period, after which, in each such case, the Company shall

promptly resume making any and all required payments in respect of the

Securities, including any missed payments. 

Notwithstanding any other provision of this Indenture, in no event shall

a Payment Blockage Period extend beyond 179 days from the date of the receipt

by the Company or the Trustee of the notice referred to in clause (2) of this

paragraph (b) (the “Initial Blockage Period”). 

Any number of notices of Non-payment Defaults may be given during the

Initial Blockage Period; provided that during any 365-day consecutive

period only one Payment Blockage Period during which payment of principal of,

or interest on, the Securities may not be made may commence and the duration of

the Payment Blockage Period may not exceed 179 days.  No Non-payment Default with respect to Designated Senior

Indebtedness which existed or was continuing on the date of the commencement of

any Payment Blockage Period will be, or can be, made the basis for the

commencement of a second Payment Blockage Period, whether or not within a

period of 365 consecutive days, unless such default shall have been cured or

waived for a period of not less than 90 consecutive days.

 

(c)           In

the event that, notwithstanding the foregoing, the Company shall make any

payment to the Trustee or the Holder of any Security prohibited by the

foregoing provisions of this Section, then and in such event such payment shall

be paid over and delivered forthwith to a Senior Representative of the holders

of the Designated Senior Indebtedness or as a court of competent jurisdiction

shall direct.

 

Section 1204. 

Payment Permitted if No Default.

 

Nothing contained in this Article, elsewhere in this

Indenture or in any of the Securities shall prevent the Company, at any time

except during the pendency of any case, proceeding, dissolution, liquidation or

other winding up, assignment for the benefit of creditors or other marshaling

of assets and liabilities of the Company referred to in Section 1202 or

under the conditions described in Section 1203, from making payments at

any time of principal of, premium, if any, or interest on the Securities.

 

135

 

Section 1205. 

Subrogation to Rights of Holders of

Senior Indebtedness.

 

Subject to the payment in full of all Senior

Indebtedness in cash or Cash Equivalents or in any other form as acceptable to

the holders of Senior Indebtedness, the Holders of the Securities shall be

subrogated to the rights of the holders of such Senior Indebtedness to receive

payments and distributions of cash, property and securities applicable to the

Senior Indebtedness until the principal of, premium, if any, and interest on

the Securities shall be paid in full. 

For purposes of such subrogation, no payments or distributions to the

holders of Senior Indebtedness of any cash, property or securities to which the

Holders or the Trustee would be entitled except for the provisions of this

Article, and no payments over pursuant to the provisions of this Article to the

holders of Senior Indebtedness by Holders of the Securities or the Trustee,

shall, as among the Company, its creditors other than holders of Senior

Indebtedness, and the Holders of the Securities, be deemed to be a payment or

distribution by the Company to or on account of the Senior Indebtedness.

 

Section 1206. 

Provisions Solely to Define Relative Rights.

 

The provisions of this Article are intended solely for

the purpose of defining the relative rights of the Holders of the Securities on

the one hand and the holders of Senior Indebtedness on the other hand.  Nothing contained in this Article or

elsewhere in this Indenture or in the Securities is intended to or shall

(a) impair, as among the Company, its creditors other than holders of

Senior Indebtedness and the Holders of the Securities, the obligation of the

Company, which is absolute and unconditional, to pay to the Holders of the

Securities the principal of, premium, if any, and interest on the Securities as

and when the same shall become due and payable in accordance with their terms;

or (b) affect the relative rights against the Company of the Holders of

the Securities and creditors of the Company other than the holders of Senior

Indebtedness; or (c) prevent the Trustee or the Holder of any Security

from exercising all remedies otherwise permitted by applicable law upon default

under this Indenture, subject to the rights, if any, under this Article of the

holders of Senior Indebtedness (1) in any case, proceeding, dissolution,

liquidation or other winding up, assignment for the benefit of creditors or

other marshaling of assets and liabilities of the Company referred to in

Section 1202, to receive, pursuant to and in accordance with such Section,

cash, property and securities otherwise payable or deliverable to the Trustee

or such Holder, or (2) under the conditions specified in Section 1203, to

prevent any payment prohibited by such Section or enforce their rights pursuant

to Section 1203(c).

 

Section 1207.  Trustee to Effectuate Subordination.

 

Each Holder of a Security by his acceptance thereof

authorizes and directs the Trustee on his behalf to take such action as may be

necessary or appropriate to effectuate the subordination provided in this

Article and appoints the Trustee his attorney-in-fact for

 

136

 

any and all such purposes, including, in the event of any dissolution,

winding-up, liquidation or reorganization of the Company whether in bankruptcy,

insolvency, receivership proceedings, or otherwise, the timely filing of a

claim for the unpaid balance of the Indebtedness of the Company owing to such

Holder in the form required in such proceedings and the causing of such claim

to be approved.

 

Section 1208. 

No Waiver of Subordination Provisions.

 

(a)           No

right of any present or future holder of any Senior Indebtedness to enforce

subordination as herein provided shall at any time in any way be prejudiced or

impaired by any act or failure to act on the part of the Company or by any act

or failure to act by any such holder, or by any non-compliance by the Company

with the terms, provisions and covenants of this Indenture, regardless of any

knowledge thereof any such holder may have or be otherwise charged with.

 

(b)           Without

limiting the generality of Subsection (a) of this Section and notwithstanding

any other provision contained herein, the holders of Senior Indebtedness may,

at any time and from time to time, without the consent of or notice to the

Trustee or the Holders of the Securities, without incurring responsibility to

the Holders of the Securities and without impairing or releasing the

subordination provided in this Article or the obligations hereunder of the

Holders of the Securities to the holders of Senior Indebtedness, do any one or

more of the following:  (1) change

the manner, place or terms of payment or extend the time of payment of, or

renew or alter, Senior Indebtedness or any instrument evidencing the same or

any agreement under which Senior Indebtedness is outstanding; (2) sell,

exchange, release or otherwise deal with any property pledged, mortgaged or

otherwise securing Senior Indebtedness; (3) release any Person liable in

any manner for the collection or payment of Senior Indebtedness; and

(4) exercise or refrain from exercising any rights against the Company and

any other Person; provided, however, that in no event shall any

such actions limit the right of the Holders of the Securities to take any

action to accelerate the maturity of the Securities in accordance with the

provisions set forth in Article Five or to pursue any rights or remedies

under this Indenture or under applicable laws if the taking of such action does

not otherwise violate the terms of this Article.

 

Section 1209. 

Notice to Trustee.

 

(a)           The

Company shall give prompt written notice to the Trustee of any fact known to

the Company which would prohibit the making of any payment to or by the Trustee

in respect of the Securities or other Indenture Obligations.  Notwithstanding the provisions of this

Article or any provision of this Indenture, the Trustee shall not be charged

with knowledge of the existence of any facts which would prohibit the making of

any payment to or by the Trustee in respect of the Securities, unless and until

the Trustee shall have received written notice thereof from the Company or a

holder of Senior

 

137

 

Indebtedness or from a Senior Representative or any trustee, fiduciary

or agent therefor; and, prior to the receipt of any such written notice, the

Trustee shall be entitled in all respects to assume that no such facts exist; provided,

however, that if the Trustee shall not have received the notice provided

for in this Section prior to the date upon which by the terms hereof any money

may become payable for any purpose (including, without limitation, the payment

of the principal of, premium, if any, or interest on any Security or other

Indenture Obligations), then, anything herein contained to the contrary

notwithstanding but without limiting the rights and remedies of the holders of Senior

Indebtedness or any trustee, fiduciary or agent thereof, the Trustee shall have

full power and authority to receive such money and to apply the same to the

purpose for which such money was received and shall not be affected by any

notice to the contrary which may be received by it after such date; nor shall

the Trustee be charged with knowledge of the curing of any such default or the

elimination of the act or condition preventing any such payment unless and

until the Trustee shall have received an Officers’ Certificate to such effect.

 

(b)           The

Trustee shall be entitled to rely on the delivery to it of a written notice to

the Trustee and the Company by a Person representing himself to be a Senior

Representative or a holder of Senior Indebtedness (or a trustee, fiduciary or

agent therefor) to establish that such notice has been given by a Senior

Representative or a holder of Senior Indebtedness (or a trustee, fiduciary or

agent therefor); provided, however, that failure to give such

notice to the Company shall not affect in any way the ability of the Trustee to

rely on such notice.  In the event that

the Trustee determines in good faith that further evidence is required with

respect to the right of any Person as a holder of Senior Indebtedness to

participate in any payment or distribution pursuant to this Article, the

Trustee may request such Person to furnish evidence to the reasonable

satisfaction of the Trustee as to the amount of Senior Indebtedness held by

such Person, the extent to which such Person is entitled to participate in such

payment or distribution and any other facts pertinent to the rights of such

Person under this Article, and if such evidence is not furnished, the Trustee

may defer any payment to such Person pending judicial determination as to the

right of such Person to receive such payment.

 

Section 1210. 

Reliance on Judicial Order or

Certificate of Liquidating Agent.

 

Upon any payment or distribution of assets of the

Company referred to in this Article, the Trustee and the Holders of the

Securities shall be entitled to rely upon any order or decree entered by any

court of competent jurisdiction in which such insolvency, bankruptcy,

receivership, liquidation, reorganization, dissolution, winding up or similar

case or proceeding is pending, or a certificate of the trustee in bankruptcy,

receiver, liquidating trustee, custodian, assignee for the benefit of

creditors, agent or other person making such payment or distribution, delivered

to the Trustee or to the Holders of Securities, for the purpose of ascertaining

the Persons entitled to participate in such

 

138

 

payment or distribution, the holders of Senior Indebtedness and other

Indebtedness of the Company, the amount thereof or payable thereon, the amount

or amounts paid or distributed thereon and all other facts pertinent thereto or

to this Article, provided that the foregoing shall apply only if such

court has been fully apprised of the provisions of this Article.

 

Section 1211.  Rights of Trustee as a Holder of Senior Indebtedness;

Preservation of Trustee’s Rights.

 

The Trustee in its individual capacity shall be

entitled to all the rights set forth in this Article with respect to any Senior

Indebtedness which may at any time be held by it, to the same extent as any

other holder of Senior Indebtedness, and nothing in this Indenture shall

deprive the Trustee of any of its rights as such holder.  Nothing in this Article shall apply to

claims of, or payments to, the Trustee under or pursuant to Section 606.

 

Section 1212. 

Article Applicable to Paying Agents.

 

In case at any time any Paying Agent other than the

Trustee shall have been appointed by the Company and be then acting under this

Indenture, the term “Trustee” as used in this Article shall in such case

(unless the context otherwise requires) be construed as extending to and

including such Paying Agent within its meaning as fully for all intents and

purposes as if such Paying Agent were named in this Article in addition to or

in place of the Trustee; provided, however, that Section 1211

shall not apply to the Company or any Affiliate of the Company if it or such

Affiliate acts as Paying Agent.

 

Section 1213. 

No Suspension of Remedies.

 

Nothing contained in this Article shall limit the right

of the Trustee or the Holders of Securities to take any action to accelerate

the maturity of the Securities pursuant to Article Five and as set forth in

this Indenture or to pursue any rights or remedies hereunder or under

applicable law, subject to the rights, if any, under this Article of the

holders, from time to time, of Senior Indebtedness to receive the cash,

property or securities receivable upon the exercise of such rights or remedies.

 

Section 1214. 

Trustee’s Relation to Senior Indebtedness.

 

With respect to the holders of Senior Indebtedness,

the Trustee undertakes to perform or to observe only such of its covenants and

obligations as are specifically set forth in this Article, and no implied

covenants or obligations with respect to the holders of Senior Indebtedness

shall be read into this Article against the Trustee.  The Trustee shall not be deemed to owe any fiduciary duty to the

holders of Senior Indebtedness and the Trustee shall not be liable to any

holder of Senior Indebtedness if it shall mistakenly

 

139

 

in the absence of gross negligence or willful misconduct pay over or

deliver to Holders, the Company or any other Person moneys or assets to which

any holder of Senior Indebtedness shall be entitled by virtue of this Article

or otherwise.

 

ARTICLE THIRTEEN

 

SATISFACTION AND

DISCHARGE

 

Section 1301. 

Satisfaction and Discharge of Indenture.

 

This Indenture shall cease to be of further effect

(except as to surviving rights of registration of transfer or exchange of

Securities herein, rights to payment, including Penalty Interest, and rights to

replacement of stolen, lost or mutilated Securities expressly provided for) and

the Trustee, on demand of and at the expense of the Company, shall execute

proper instruments acknowledging satisfaction and discharge of this Indenture,

when

 

(a)           either

 

(1)           all the Securities theretofore

authenticated and delivered (other than (i) Securities which have been

destroyed, lost or stolen and which have been replaced or paid as provided in

Section 308 or (ii) all Securities for whose payment United States dollars

have theretofore been deposited in trust or segregated and held in trust by the

Company and thereafter repaid to the Company or discharged from such trust, as

provided in Section 1003) have been delivered to the Trustee for cancellation;

or

 

(2)           all such Securities not theretofore

delivered to the Trustee for cancellation (x) have become due and payable,

(y) will become due and payable at their Stated Maturity within one year,

or (z) are to be called for redemption within one year under arrangements

satisfactory to the Trustee for the giving of notice of redemption by the

Trustee in the name, and at the expense, of the Company, and the Company or any

Guarantor, in the case of (2)(x),(y) or (z) above, has irrevocably deposited or

caused to be deposited with the Trustee as trust funds in trust for the purpose

an amount in United States dollars sufficient to pay and discharge the entire

Indebtedness on the Securities not theretofore delivered to the Trustee for

cancellation, for the principal of, premium, if any, and accrued interest at

such Stated Maturity or Redemption Date;

 

(b)           the

Company or any Guarantor has paid or caused to be paid all other sums payable

hereunder by the Company or any Guarantor; and

 

140

 

(c)           the

Company has delivered to the Trustee an Officers’ Certificate and an Opinion of

Counsel stating that (i) all conditions precedent herein provided for

relating to the satisfaction and discharge of this Indenture have been complied

with and (ii) such satisfaction and discharge will not result in a breach

or violation of or constitute a default under, this Indenture or any other

material agreement or instrument to which the Company or any Guarantor is a

party or by which the Company or any Guarantor is bound.

 

Opinions of Counsel required to be delivered under

this Section may have qualifications customary for opinions of the type

required and counsel delivering such Opinions of Counsel may rely on

certificates of the Company or government or other officials customary for

opinions of the type required, including certificates certifying as to matters

of fact, including that various financial covenants have been complied with.

 

Notwithstanding the satisfaction and discharge of this

Indenture, the obligations of the Company to the Trustee under Section 606

and, if United States dollars shall have been deposited with the Trustee

pursuant to subclause (2) of Subsection (a) of this Section, the

obligations of the Trustee under Section 1302 and the last paragraph of

Section 1003 shall survive.

 

Section 1302. 

Application of Trust Money.

 

Subject to the provisions of the last paragraph of

Section 1003, all United States dollars deposited with the Trustee

pursuant to Section 1301 shall be held in trust and applied by it, in

accordance with the provisions of the Securities and this Indenture (including,

without limitation, Section 605), to the payment, either directly or through

any Paying Agent (including the Company acting as its own Paying Agent) as the

Trustee may determine, to the Persons entitled thereto, of the principal of,

premium, if any, and interest on the Securities for whose payment such United

States dollars have been deposited with the Trustee.

 

ARTICLE FOURTEEN

 

GUARANTEE

 

Section 1401. 

Guarantors’ Guarantee.

 

For value received, each of the Guarantors, in

accordance with this Article Fourteen, hereby absolutely, unconditionally and

irrevocably guarantees, jointly and severally, to the Trustee and the Holders,

as if the Guarantors were the principal debtor, the punctual payment and

performance when due of all Indenture Obligations (which for purposes of this

Guarantee shall also be deemed to include all commissions, fees, charges,

 

141

 

costs and other expenses (including reasonable legal

fees and disbursements of one counsel in connection with any one action or

separate but similar or related actions in the same jurisdiction arising out of

the same general allegations or circumstances) arising out of or incurred by

the Trustee or the Holders in connection with the enforcement of this

Guarantee).

 

Section 1402. 

Continuing Guarantee; No Right of Set-Off; Independent Obligation.

 

(a)           This

Guarantee shall be a continuing guarantee of the payment and performance of all

Indenture Obligations and shall remain in full force and effect until the

payment in full of all of the Indenture Obligations and shall apply to and

secure any ultimate balance due or remaining unpaid to the Trustee or the

Holders; and this Guarantee shall not be considered as wholly or partially

satisfied by the payment or liquidation at any time or from time to time of any

sum of money for the time being due or remaining unpaid to the Trustee or the

Holders.  Each Guarantor, jointly and

severally, covenants and agrees to comply with all obligations, covenants,

agreements and provisions applicable to it in this Indenture including those

set forth in Article Eight.  Without

limiting the generality of the foregoing, each of the Guarantors’ liability

shall extend to all amounts which constitute part of the Indenture Obligations

and would be owed by the Company under this Indenture and the Securities but

for the fact that they are unenforceable, reduced, limited, impaired, suspended

or not allowable due to the existence of a bankruptcy, reorganization or

similar proceeding involving the Company.

 

(b)           Each

Guarantor, jointly and severally, hereby guarantees that the Indenture

Obligations will be paid to the Trustee without set-off or counterclaim or

other reduction whatsoever (whether for taxes, withholding or otherwise) in

lawful currency of the United States of America.

 

(c)           Each

Guarantor, jointly and severally, guarantees that the Indenture Obligations

shall be paid strictly in accordance with their terms regardless of any law,

regulation or order now or hereafter in effect in any jurisdiction affecting

any of such terms or the rights of the holders of the Securities.

 

(d)           Each

Guarantor’s liability under this Guarantee to pay or perform or cause the

performance of the Indenture Obligations shall arise forthwith after demand for

payment or performance by the Trustee has been given to the Guarantors in the

manner prescribed in Section 106 hereof.

 

(e)           Except

as provided herein, the provisions of this Article Fourteen cover all

agreements between the parties hereto relative to this Guarantee and none of

the parties shall be bound by any representation, warranty or promise made by

any Person relative thereto which is not embodied herein; and it is

specifically acknowledged and

 

142

 

agreed that this Guarantee has been delivered by each Guarantor free of

any conditions whatsoever and that no representations, warranties or promises

have been made to any Guarantor affecting its liabilities hereunder, and that

the Trustee shall not be bound by any representations, warranties or promises

now or at any time hereafter made by the Company to any Guarantor.

 

Section 1403.  Guarantee Absolute.

 

The obligations of the Guarantors hereunder are

independent of the obligations of the Company under the Securities and this

Indenture and a separate action or actions may be brought and prosecuted

against any Guarantor whether or not an action or proceeding is brought against

the Company and whether or not the Company is joined in any such action or

proceeding.  The liability of the Guarantors

hereunder is irrevocable, absolute and unconditional and (to the extent

permitted by law) the liability and obligations of the Guarantors hereunder

shall not be released, discharged, mitigated, waived, impaired or affected in

whole or in part by:

 

(a)        any defect or lack of validity or enforceability

in respect of any Indebtedness or other obligation of the Company or any other

Person under this Indenture or the Securities, or any agreement or instrument

relating to any of the foregoing;

 

(b)        any grants of time, renewals,

extensions, indulgences, releases, discharges or modifications which the

Trustee or the Holders may extend to, or make with, the Company, any Guarantor

or any other Person, or any change in the time, manner or place of payment of,

or in any other term of, all or any of the Indenture Obligations, or any other

amendment or waiver of, or any consent to or departure from, this Indenture or

the Securities, including any increase or decrease in the Indenture

Obligations;

 

(c)        the taking of security from the Company,

any Guarantor or any other Person, and the release, discharge or alteration of,

or other dealing with, such security;

 

(d)        the occurrence of any change in the

laws, rules, regulations or ordinances of any jurisdiction by any present or

future action of any governmental authority or court amending, varying,

reducing or otherwise affecting, or purporting to amend, vary, reduce or

otherwise affect, any of the Indenture Obligations and the obligations of any

Guarantor hereunder;

 

143

 

(e)        the abstention from taking security from

the Company, any Guarantor or any other Person or from perfecting, continuing

to keep perfected or taking advantage of any security;

 

(f)         any loss, diminution of value or lack

of enforceability of any security received from the Company, any Guarantor or

any other Person, and including any other guarantees received by the Trustee;

 

(g)        any other dealings with the Company, any

Guarantor or any other Person, or with any security;

 

(h)        the Trustee’s or the Holders’ acceptance

of compositions from the Company or any Guarantor;

 

(i)         the application by the Holders or the

Trustee of all monies at any time and from time to time received from the

Company, any Guarantor or any other Person on account of any indebtedness and

liabilities owing by the Company or any Guarantor to the Trustee or the

Holders, in such manner as the Trustee or the Holders deems best and the

changing of such application in whole or in part and at any time or from time

to time, or any manner of application of collateral, if any, or proceeds

thereof, to all or any of the Indenture Obligations, or the manner of sale of

any such collateral;

 

(j)         the release or discharge of the Company

or any Guarantor of the Securities or of any Person liable directly as surety

or otherwise by operation of law or otherwise for the Securities, other than an

express release in writing given by the Trustee, on behalf of the Holders, of

the liability and obligations of any Guarantor hereunder;

 

(k)        any change in the name, business,

capital structure or governing instrument of the Company or any Guarantor or

any refinancing or restructuring of any of the Indenture Obligations;

 

(l)         the sale of the Company’s or any

Guarantor’s business or any part thereof;

 

(m)       subject to Section 1414, any merger or

consolidation, arrangement or reorganization of the Company, any Guarantor, any

Person resulting from the merger or consolidation of the Company or any

Guarantor with any other Person or any other successor to such Person or merged

or consolidated Person or any other change in the

 

144

 

corporate

existence, structure or ownership of the Company or any Guarantor;

 

(n)        the insolvency, bankruptcy, liquidation,

winding-up, dissolution, receivership or distribution of the assets of the

Company or its assets or any resulting discharge of any obligations of the

Company (whether voluntary or involuntary) or of any Guarantor or the loss of

corporate existence;

 

(o)        subject to Section 1414, any arrangement

or plan of reorganization affecting the Company or any Guarantor;

 

(p)        any other circumstance (including any

statute of limitations) that might otherwise constitute a defense available to,

or discharge of, the Company or any Guarantor; or

 

(q)        any modification, compromise, settlement

or release by the Trustee, or by operation of law or otherwise, of the

Indenture Obligations or the liability of the Company or any other obligor

under the Securities, in whole or in part, and any refusal of payment by the

Trustee, in whole or in part, from any other obligor or other guarantor in

connection with any of the Indenture Obligations, whether or not with notice

to, or further assent by, or any reservation of rights against, each of the

Guarantors.

 

Section 1404.  Right to Demand Full Performance.

 

In the event of any demand for payment or performance

by the Trustee from any Guarantor hereunder, the Trustee or the Holders shall

have the right to demand its full claim and to receive all dividends or other

payments in respect thereof until the Indenture Obligations have been paid in

full, and the Guarantors shall continue to be jointly and severally liable

hereunder for any balance which may be owing to the Trustee or the Holders by

the Company under this Indenture and the Securities.  The retention by the Trustee or the Holders of any security,

prior to the realization by the Trustee or the Holders of its rights to such

security upon foreclosure thereon, shall not, as between the Trustee and any

Guarantor, be considered as a purchase of such security, or as payment,

satisfaction or reduction of the Indenture Obligations due to the Trustee or

the Holders by the Company or any part thereof.

 

145

 

Section 1405.  Waivers.

 

(a)           Each

Guarantor hereby expressly waives (to the extent permitted by law) notice of

the acceptance of this Guarantee and notice of the existence, renewal,

extension or the non-performance, non-payment, or non-observance on the part of

the Company of any of the terms, covenants, conditions and provisions of this

Indenture or the Securities or any other notice whatsoever to or upon the

Company or such Guarantor with respect to the Indenture Obligations.  Each Guarantor hereby acknowledges

communication to it of the terms of this Indenture and the Securities and all

of the provisions therein contained and consents to and approves the same.  Each Guarantor hereby expressly waives (to

the extent permitted by law) diligence, presentment, protest and demand for

payment.

 

(b)           Without

prejudice to any of the rights or recourses which the Trustee or the Holders

may have against the Company, each Guarantor hereby expressly waives (to the

extent permitted by law) any right to require the Trustee or the Holders to:

 

(i)                           initiate or exhaust any rights, remedies

or recourse against the Company, any Guarantor or any other Person;

 

(ii)                        value, realize upon, or dispose of any

security of the Company or any other Person held by the Trustee or the Holders;

or

 

(iii)                     initiate or exhaust any other remedy which the Trustee

or the Holders may have in law or equity;

 

before requiring

or becoming entitled to demand payment from such Guarantor under this

Guarantee.

 

(c)           With

respect to this Section 1405, to the extent applicable to any Guarantor, each

Guarantor expressly waives application of Sections 26-7 through 26-9 of the

North Carolina General Statutes.

 

Section 1406. 

The Guarantors Remain Obligated in Event the Company Is No Longer

Obligated to Discharge Indenture Obligations.

 

It is the express intention of the Trustee and the

Guarantors that if for any reason the Company has no legal existence, is or

becomes under no legal obligation to discharge the Indenture Obligations owing

to the Trustee or the Holders by the Company or if any of the Indenture

Obligations owing by the Company to the Trustee or the Holders becomes

irrecoverable from the Company by operation of law or for any reason

whatsoever, this Guarantee and the covenants, agreements and obligations of the

 

146

 

Guarantors contained in this Article Fourteen shall nevertheless be

binding upon the Guarantors, as principal debtor, until such time as all such

Indenture Obligations have been paid in full to the Trustee and all Indenture

Obligations owing to the Trustee or the Holders by the Company have been

discharged, or such earlier time as Section 402 shall apply to the Securities

and the Guarantors shall be responsible for the payment thereof to the Trustee

or the Holders upon demand.

 

Section 1407.  Fraudulent Conveyance;

Contribution; Subrogation.

 

(a)           Each

Guarantor that is a Subsidiary of the Company, and by its acceptance hereof

each Holder, hereby confirms that it is the intention of all such parties that

the Guarantee by such Guarantor pursuant to its Guarantee not constitute a

fraudulent transfer or conveyance for purposes of the Bankruptcy Law, the

Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any

similar federal or state law.  To effectuate

the foregoing intention, the Holders and such Guarantor hereby irrevocably

agree that the obligations of such Guarantor under its Guarantee shall be

limited to the maximum amount which, after giving effect to all other

contingent and fixed liabilities of such Guarantor as of the date hereof, and

after giving effect to any collections from or payments made by or on behalf of

any other Guarantor in respect of the obligations of such other Guarantor under

its Guarantee or pursuant to its contribution obligations under this Indenture,

will result in the obligations of such Guarantor under its Guarantee not

constituting such fraudulent transfer or conveyance.

 

(b)           Each

Guarantor that makes a payment or distribution under its Guarantee shall be

entitled to a contribution from each other Guarantor, if any, in a pro rata

amount based on the net assets of each Guarantor, determined in accordance with

GAAP.

 

(c)           Each

Guarantor hereby waives all rights of subrogation or contribution, whether

arising by contract or operation of law (including, without limitation, any

such right arising under federal bankruptcy law) or otherwise by reason of any

payment by it pursuant to the provisions of this Article Fourteen.

 

Section 1408. 

Guarantee Is in Addition to Other Security.

 

This Guarantee shall be in addition to and not in

substitution for any other guarantees or other security which the Trustee may

now or hereafter hold in respect of the Indenture Obligations owing to the

Trustee or the Holders by the Company and (except as may be required by law)

the Trustee shall be under no obligation to marshal in favor of each of the

Guarantors any other guarantees or other security or any moneys or other assets

which the Trustee may be entitled to receive or upon which the Trustee or the

Holders may have a claim.

 

147

 

Section 1409. 

Release of Security Interests.

 

Without limiting the generality of the foregoing and

except as otherwise provided in this Indenture, each Guarantor hereby consents

and agrees, to the fullest extent permitted by applicable law, that the rights

of the Trustee hereunder, and the liability of the Guarantors hereunder, shall

not be affected by any and all releases for any purpose of any collateral, if

any, from the Liens and security interests created by any collateral document

and that this Guarantee shall continue to be effective or be reinstated, as the

case may be, if at any time any payment of any of the Indenture Obligations is

rescinded or must otherwise be returned by the Trustee upon the insolvency,

bankruptcy or reorganization of the Company or otherwise, all as though such

payment had not been made.

 

Section 1410. 

No Bar to Further Actions.

 

Except as provided by law, no action or proceeding

brought or instituted under Article Fourteen and this Guarantee and no recovery

or judgment in pursuance thereof shall be a bar or defense to any further

action or proceeding which may be brought under Article Fourteen and this

Guarantee by reason of any further default or defaults under Article Fourteen

and this Guarantee or in the payment of any of the Indenture Obligations owing

by the Company.

 

Section 1411. 

Failure to Exercise Rights Shall Not Operate as a Waiver; No

Suspension of Remedies.

 

(a)           No

failure to exercise and no delay in exercising, on the part of the Trustee or

the Holders, any right, power, privilege or remedy under this Article Fourteen

and this Guarantee shall operate as a waiver thereof, nor shall any single or

partial exercise of any rights, power, privilege or remedy preclude any other

or further exercise thereof, or the exercise of any other rights, powers,

privileges or remedies.  The rights and

remedies herein provided for are cumulative and not exclusive of any rights or

remedies provided in law or equity.

 

(b)           Nothing

contained in this Article Fourteen shall limit the right of the Trustee or the

Holders to take any action to accelerate the maturity of the Securities

pursuant to Article Five or to pursue any rights or remedies hereunder or under

applicable law.

 

Section 1412. 

Trustee’s Duties; Notice to Trustee.

 

(a)           Any

provision in this Article Fourteen or elsewhere in this Indenture allowing the

Trustee to request any information or to take any action authorized by, or on

behalf of any Guarantor, shall be permissive and shall not be obligatory on the

Trustee

 

148

 

except as the Holders may direct in accordance with the provisions of

this Indenture or where the failure of the Trustee to request any such

information or to take any such action arises from the Trustee’s negligence,

bad faith or willful misconduct.

 

(b)           The

Trustee shall not be required to inquire into the existence, powers or

capacities of the Company, any Guarantor or the officers, directors or agents

acting or purporting to act on their respective behalf.

 

Section 1413. 

Successors and Assigns.

 

All terms, agreements and conditions of this Article

Fourteen shall extend to and be binding upon each Guarantor and its successors

and permitted assigns and shall enure to the benefit of and may be enforced by

the Trustee and its successors and assigns; provided, however,

that the Guarantors may not assign any of their rights or obligations hereunder

other than in accordance with Article Eight.

 

Section 1414. 

Release of Guarantee.

 

Concurrently with the payment in full of all of the

Indenture Obligations, the Guarantors shall be released from and relieved of

their obligations under this Article Fourteen. 

Upon the delivery by the Company to the Trustee of an Officer’s

Certificate and, if requested by the Trustee, an Opinion of Counsel to the

effect that the transaction giving rise to the release of this Guarantee was

made by the Company in accordance with the provisions of this Indenture and the

Securities, the Trustee shall execute any documents reasonably required in

order to evidence the release of the Guarantors from their obligations under

this Guarantee.  If any of the Indenture

Obligations are revived and reinstated after the termination of this Guarantee,

then all of the obligations of the Guarantors under this Guarantee shall be

revived and reinstated as if this Guarantee had not been terminated until such

time as the Indenture Obligations are paid in full, and each Guarantor shall

enter into an amendment to this Guarantee, reasonably satisfactory to the

Trustee, evidencing such revival and reinstatement.

 

This Guarantee shall terminate with respect to each

Guarantor and shall be automatically and unconditionally released and discharged

as provided in Section 1014(c).

 

Section 1415.  Execution of Guarantee.

 

To evidence the Guarantee, each Guarantor hereby

agrees to execute the guarantee substantially in the form set forth in Section

206, to be endorsed on each Security authenticated and delivered by the Trustee

and that this Indenture shall be executed (1) on behalf of each corporate

Guarantor by its Chairman of the Board, its

 

149

 

President, or one of its Vice Presidents and attested by its Secretary

or one of its Assistant Secretaries, (2) on behalf of each Guarantor that is a

partnership, by one or more of its general partners and (3) by each Guarantor

that is a limited liability company, by one or more of its managers or by its

sole member.  The signature of any of

these officers, partners, managers, or members on the Securities may be manual

or facsimile.

 

Section 1416. 

Guarantee 

Subordinate to Guarantor Senior Indebtedness.

 

Each Guarantor covenants and agrees, and each Holder

of a Guarantee, by his acceptance thereof, likewise covenants and agrees, that,

to the extent and in the manner hereinafter set forth in this Article, the

Indebtedness represented by the Guarantees is hereby made subordinate and

subject in right of payment as provided in this Article to the prior payment in

full in cash or Cash Equivalents or in any other form as acceptable to the

holders of Guarantor Senior Indebtedness of all Guarantor Senior Indebtedness; provided,

however, that the Indebtedness represented by this Guarantee in all

respects shall rank equally with, or prior to, all existing and future

Indebtedness of such Guarantor that is expressly subordinated to such

Guarantor’s Guarantor Senior Indebtedness.

 

This Article Fourteen shall constitute a continuing

offer to all Persons who, in reliance upon such provisions, become holders of,

or continue to hold Guarantor Senior Indebtedness; and such provisions are made

for the benefit of the holders of Guarantor Senior Indebtedness; and such

holders are made obligees hereunder and they or each of them may enforce such

provisions.

 

With respect to the relative rights of Holders and

holders of Senior Indebtedness and Guarantor Senior Indebtedness and for the

purpose of Section 1407(a), each Holder of a Security by his acceptance thereof

acknowledges that all Senior Indebtedness and any guarantee by a Guarantor of

such Senior Indebtedness shall be deemed to have been incurred prior to the

incurrence by such Guarantor of its liability under its Guarantee.

 

Section 1417.  Payment

Over of Proceeds Upon Dissolution of the Guarantor, etc.

 

In the event of (a) any insolvency or bankruptcy

case or proceeding, or any receivership, liquidation, reorganization or other

similar case or proceeding in connection therewith, relative to any Guarantor

or to its creditors, as such, or to its assets, or (b) any liquidation,

dissolution or other winding up of any Guarantor, whether voluntary or

involuntary and whether or not involving insolvency or bankruptcy, or (c) any

assignment for the benefit of creditors or any other marshaling of assets or

liabilities of any Guarantor, then and in any such event:

 

150

 

(1)           the

holders of Guarantor Senior Indebtedness shall be entitled to receive payment

in full in cash or Cash Equivalents or in any other form as acceptable to the

holders of Guarantor Senior Indebtedness of all amounts due on or in respect of

all Guarantor Senior Indebtedness, before the Holders of the Securities are

entitled to receive any payment or distribution of any kind or character

(excluding Permitted Guarantor Junior Securities) on account of the Guarantee

of such Guarantor; and

 

(2)           any

payment or distribution of assets of any Guarantor of any kind or character,

whether in cash, property or securities (excluding Permitted Guarantor Junior

Securities), by set-off or otherwise, to which the Holders or the Trustee would

be entitled but for the provisions of this Article shall be paid by the

liquidating trustee or agent or other Person making such payment or

distribution, whether a trustee in bankruptcy, a receiver or liquidating

trustee or  otherwise, directly to the

holders of Guarantor Senior Indebtedness or their representative or

representatives or to the trustee or trustees under any indenture under which

any instruments evidencing any of such Guarantor Senior Indebtedness may have

been issued, ratably according to the aggregate amounts remaining unpaid on

account of the Guarantor Senior Indebtedness held or represented by each, to

the extent necessary to make payment in full in cash or Cash Equivalents or in

any other form as acceptable to the holders of Guarantor Senior Indebtedness of

all Guarantor Senior Indebtedness remaining unpaid, after giving effect to any concurrent

payment or distribution to the holders of such Guarantor Senior Indebtedness;

and

 

(3)           in

the event that, notwithstanding the foregoing provisions of this Section, the

Trustee or the Holder of any Security shall have received any payment or distribution

of assets of any Guarantor of any kind or character, whether in cash, property

or securities, in respect of the Guarantee of such Guarantor before all

Guarantor Senior Indebtedness is paid in full, then and in such event such

payment or distribution (excluding Permitted Guarantor Junior Securities) shall

be paid over or delivered forthwith to the trustee in bankruptcy, receiver,

liquidating trustee, custodian, assignee, agent or other person making payment

or distribution of assets of such Guarantor for application to the payment of

all Guarantor Senior Indebtedness remaining unpaid, to the extent necessary to

pay all Guarantor Senior Indebtedness in full in cash or Cash Equivalents or in

any other form as acceptable to the holders of Guarantor Senior Indebtedness

after giving effect to any concurrent payment or distribution to or for the

holders of Guarantor Senior Indebtedness.

 

The consolidation of any Guarantor with, or the merger

of any Guarantor with or into, another Person or the liquidation or dissolution

of any Guarantor following the sale, assignment, conveyance, transfer, lease or

other disposal of all or substantially all of such Guarantor’s properties or

assets to another Person upon the terms and conditions set forth in Article

Eight shall not be deemed a dissolution, winding up, liquidation,

reorganization, assignment for the benefit of creditors or marshaling of assets

and

 

151

 

liabilities of such Guarantor for the purposes of this Section if the

Person formed by such consolidation or the surviving entity of such merger or

the Person which acquires by sale, assignment, conveyance, transfer, lease or

other disposal of all or substantially all of such Guarantor’s properties and

assets, as the case may be, shall, as a part of such consolidation, merger,

sale, assignment, conveyance, transfer, lease or other disposal comply with the

conditions set forth in Article Eight.

 

Section 1418. 

Default on Guarantor Senior Indebtedness.

 

(a)           Upon

the maturity of any Guarantor Senior Indebtedness by lapse of time,

acceleration or otherwise, all principal thereof and interest thereon and other

amounts due in connection therewith shall first be paid in full or such payment

duly provided for before any payment is made by any of the Guarantors or any

Person acting on behalf of any of the Guarantors in respect of the Guarantee of

such Guarantor.

 

(b)           No

payment (excluding payments in the form of Permitted Guarantor Junior

Securities) shall be made by any Guarantor in respect of its Guarantee during

the period in which Section 1417 shall be applicable, during any suspension of

payments in effect under Section 1203(a) of this Indenture or during any

Payment Blockage Period in effect under Section 1203(b) of this Indenture.

 

(c)           In

the event that, notwithstanding the foregoing, any Guarantor shall make any

payment to the Trustee or the Holder of its Guarantee prohibited by the

foregoing provisions of this Section, then and in such event such payment shall

be paid over and delivered forthwith to the representatives of Guarantor Senior

Indebtedness or as a court of competent jurisdiction shall direct.

 

Section 1419.  Payment Permitted by Each of the

Guarantors if No Default.

 

Nothing contained in this Article, elsewhere in this

Indenture or in any of the Securities shall prevent any Guarantor, at any time

except during the pendency of any case, proceeding, dissolution, liquidation or

other winding up, assignment for the benefit of creditors or other marshaling

of assets and liabilities of such Guarantor referred to in Section 1417 or

under the conditions described in Section 1418, from making payments at

any time of principal of, premium, if any, or interest on the Securities.

 

Section 1420.  Subrogation

to Rights of Holders of Guarantor Senior Indebtedness.

 

Subject to the payment in full of all Guarantor Senior

Indebtedness in cash or Cash Equivalents or in any other form acceptable to the

holders of Guarantor Senior Indebtedness, the Holders of the Securities shall

be subrogated to the rights of the holders of such Guarantor Senior

Indebtedness to receive payments and distributions of cash,

 

152

 

property and securities applicable to the Guarantor Senior Indebtedness

until the principal of, premium, if any, and interest on the Securities shall

be paid in full.  For purposes of such

subrogation, no payments or distributions to the holders of Guarantor Senior

Indebtedness of any cash, property or securities to which the Holders of the

Securities or the Trustee would be entitled except for the provisions of this

Article, and no payments over pursuant to the provisions of this Article to the

holders of Guarantor Senior Indebtedness by Holders of the Securities or the

Trustee, shall, as among any Guarantor, its creditors other than holders of

Guarantor Senior Indebtedness, and the Holders of the Securities, be deemed to

be a payment or distribution by such Guarantor to or on account of the

Guarantor Senior Indebtedness.

 

Section 1421.  Provisions Solely to Define Relative Rights.

 

The provisions of Sections 1416 through 1429 of this

Indenture are intended solely for the purpose of defining the relative rights

of the Holders of the Securities on the one hand and the holders of Guarantor

Senior Indebtedness on the other hand. 

Nothing contained in this Article or elsewhere in this Indenture or in

the Securities is intended to or shall (a) impair, as among any Guarantor,

its creditors other than holders of Guarantor Senior Indebtedness and the

Holders of the Securities, the obligation of such Guarantor, which is absolute

and unconditional, to pay to the Holders of the Securities the principal of,

premium, if any, and interest on the Securities as and when the same shall

become due and payable in accordance with their terms; or (b) affect the

relative rights against each of the Guarantors of the Holders of the Securities

and creditors of each of the Guarantors other than the holders of Guarantor

Senior Indebtedness; or (c) prevent the Trustee or the Holder of any

Security from exercising all remedies otherwise permitted by applicable law

upon default under this Indenture, subject to the rights, if any, under this

Article of the holders of Guarantor Senior Indebtedness (1) in any case,

proceeding, dissolution, liquidation or other winding up, assignment for the

benefit of creditors or other marshaling of assets and liabilities of the

Guarantors referred to in Section 1417, to receive, pursuant to and in

accordance with such Section, cash, property and securities otherwise payable

or deliverable to the Trustee or such Holder, or (2) under the conditions

specified in Section 1418, to prevent any payment prohibited by such Section or

enforce their rights pursuant to Section 1418(c).

 

Section 1422. 

Trustee to Effectuate Subordination.

 

Each Holder of a Security by his acceptance thereof

authorizes and directs the Trustee on his behalf to take such action as may be

necessary or appropriate to effectuate the subordination provided in this

Article and appoints the Trustee his attorney-in-fact for any and all such

purposes, including, in the event of any dissolution, winding-up, liquidation

or reorganization of any Guarantor whether in bankruptcy, insolvency,

receivership proceedings, or otherwise, the timely filing of a claim for the

unpaid balance

 

153

 

of the indebtedness of any Guarantor owing to such Holder in the form

required in such proceedings and the causing of such claim to be approved.

 

Section 1423. 

No Waiver of Subordination Provisions.

 

(a)           No

right of any present or future holder of any Guarantor Senior Indebtedness to

enforce subordination as herein provided shall at any time in any way be

prejudiced or impaired by any act or failure to act on the part of any

Guarantor or by any act or failure to act by any such holder, or by any

non-compliance by any Guarantor with the terms, provisions and covenants of

this Indenture, regardless of any knowledge thereof any such holder may have or

be otherwise charged with.

 

(b)           Without

limiting the generality of Subsection (a) of this Section and

notwithstanding any other provision contained herein, the holders of Guarantor

Senior Indebtedness may, at any time and from time to time, without the consent

of or notice to the Trustee or the Holders of the Securities, without incurring

responsibility to the Holders of the Securities and without impairing or

releasing the subordination provided in this Article or the obligations

hereunder of the Holders of the Securities to the holders of Guarantor Senior

Indebtedness, do any one or more of the following:  (1) change the manner, place or terms of payment or extend

the time of payment of, or renew or alter, Guarantor Senior Indebtedness or any

instrument evidencing the same or any agreement under which Guarantor Senior

Indebtedness is outstanding; (2) sell, exchange, release or otherwise deal

with any property pledged, mortgaged or otherwise securing Guarantor Senior

Indebtedness; (3) release any Person liable in any manner for the

collection or payment of Guarantor Senior Indebtedness; and (4) exercise

or refrain from exercising any rights against any of the Guarantors and any

other Person; provided, however, that in no event shall any such

actions limit the right of the Holders of the Securities to take any action to

accelerate the maturity of the Securities in accordance with the provisions set

forth in Article 5 or to pursue any rights or remedies under this

Indenture or under applicable laws if the taking of such action does not

otherwise violate the terms of this Article.

 

Section 1424.  Notice to Trustee by Each of the

Guarantors.

 

(a)           Each

Guarantor shall give prompt written notice to the Trustee of any fact known to

such Guarantor which would prohibit the making of any payment to or by the

Trustee in respect of the Guarantee. 

Notwithstanding the provisions of this Article or any provision of this

Indenture, the Trustee shall not be charged with knowledge of the existence of

any facts which would prohibit the making of any payment to or by the Trustee

in respect of the Securities, unless and until the Trustee shall have received

written notice thereof from any Guarantor or a holder of Guarantor Senior

Indebtedness or any trustee, fiduciary or agent therefor; and, prior to the

receipt of any such written notice, the Trustee shall be entitled in all

respects to assume that no such facts exist;

 

154

 

provided, however, that if

the Trustee shall not have received the notice provided for in this Section

prior to the date upon which by the terms hereof any money may become payable

for any purpose (including, without limitation, the payment of the principal

of, premium, if any, or interest on any Security or any other Indenture

Obligations), then, anything herein contained to the contrary notwithstanding

but without limiting the rights and remedies of the holders of Guarantor Senior

Indebtedness or any trustee, fiduciary or agent thereof, the Trustee shall have

full power and authority to receive such money and to apply the same to the

purpose for which such money was received and shall not be affected by any

notice to the contrary which may be received by it after such date; nor shall

the Trustee be charged with knowledge of the curing of any such default or the

elimination of the act or condition preventing any such payment unless and

until the Trustee shall have received an Officers’ Certificate to such effect.

 

(b)           The

Trustee shall be entitled to rely on the delivery to it of a written notice to

the Trustee and each Guarantor by a Person representing himself to be a

representative of one or more holders of Designated Guarantor Senior

Indebtedness (a “Guarantor Senior Representative”) or a holder of Guarantor

Senior Indebtedness (or a trustee, fiduciary or agent therefor) to establish

that such notice has been given by a Guarantor Senior Representative or a

holder of Guarantor Senior Indebtedness (or a trustee, fiduciary or agent

therefor); provided, however, that failure to give such notice to

the Company shall not affect in any way the ability of the Trustee to rely on

such notice.  In the event that the

Trustee determines in good faith that further evidence is required with respect

to the right of any Person as a holder of Guarantor Senior Indebtedness to

participate in any payment or distribution pursuant to this Article, the

Trustee may request such Person to furnish evidence to the reasonable

satisfaction of the Trustee as to the amount of Guarantor Senior Indebtedness

held by such Person, the extent to which such Person is entitled to participate

in such payment or distribution and any other facts pertinent to the rights of

such Person under this Article, and if such evidence is not furnished, the

Trustee may defer any payment to such Person pending judicial determination as

to the right of such Person to receive such payment.

 

Section 1425.  Reliance on Judicial Order or

Certificate of Liquidating Agent.

 

Upon any payment or distribution of assets of any

Guarantor referred to in this Article, the Trustee and the Holders of the

Securities shall be entitled to rely upon any order or decree entered by any

court of competent jurisdiction in which such insolvency, bankruptcy,

receivership, liquidation, reorganization, dissolution, winding up or similar

case or proceeding is pending, or a certificate of the trustee in bankruptcy,

receiver, liquidating trustee, custodian, assignee for the benefit of

creditors, agent or other person making such payment or distribution, delivered

to the Trustee or to the Holders of Securities, for the purpose of ascertaining

the Persons entitled to participate in such payment or distribution, the

holders of Guarantor Senior Indebtedness and other

 

155

 

indebtedness of such Guarantor, the amount thereof or payable thereon,

the amount or amounts paid or distributed thereon and all other facts pertinent

thereto or to this Article, provided that the foregoing shall apply only

if such court has been fully apprised of the provisions of this Article.

 

Section 1426.  Rights of Trustee as a Holder of Guarantor Senior Indebtedness;

Preservation of Trustee’s Rights.

 

The Trustee in its individual capacity shall be

entitled to all the rights set forth in this Article with respect to any

Guarantor Senior Indebtedness which may at any time be held by it, to the same

extent as any other holder of Guarantor Senior Indebtedness, and nothing in

this Indenture shall deprive the Trustee of any of its rights as such holder.  Nothing in this Article shall apply to

claims of, or payments to, the Trustee under or pursuant to Section 606.

 

Section 1427.  Article Applicable to Paying Agents.

 

In case at any time any Paying Agent other than the

Trustee shall have been appointed by the Company and be then acting under this

Indenture, the term “Trustee” as used in this Article shall in such case

(unless the context otherwise requires) be construed as extending to and

including such Paying Agent within its meaning as fully for all intents and

purposes as if such Paying Agent were named in this Article in addition to or

in place of the Trustee; provided, however, that Section 1426

shall not apply to the Company or any Affiliate of the Company if it or such

Affiliate acts as Paying Agent.

 

Section 1428. 

No Suspension of Remedies.

 

Nothing contained in this Article shall limit the

right of the Trustee or the Holders of Securities to take any action to

accelerate the maturity of the Securities pursuant to the provisions described

under Article Five and as set forth in this Indenture or to pursue any rights

or remedies hereunder or under applicable law, subject to the rights, if any,

under this Article of the holders, from time to time, of Guarantor Senior

Indebtedness to receive the cash, property or securities receivable upon the

exercise of such rights or remedies.

 

Section 1429. 

Trustee’s Relation to Guarantor Senior

Indebtedness.

 

With respect to the holders of Guarantor Senior

Indebtedness, the Trustee undertakes to perform or to observe only such of its

covenants and obligations as are specifically set forth in this Article, and no

implied covenants or obligations with respect to the holders of Guarantor

Senior Indebtedness shall be read into this Article against the Trustee.  The Trustee shall not be deemed to owe any

fiduciary duty to the holders of Guarantor Senior Indebtedness and the Trustee

shall not be liable to any holder of

 

156

 

Guarantor Senior Indebtedness if it shall mistakenly in the absence of

gross negligence or willful misconduct pay over or deliver to Holders, the

Company or any other Person moneys or assets to which any holder of Guarantor

Senior Indebtedness shall be entitled by virtue of this Article or otherwise.

 

If an officer whose signature is on this Indenture no

longer holds that office at the time the Trustee authenticates a Security on

which a Guarantee is endorsed, such Guarantee shall be valid nevertheless.

 

157

 

IN WITNESS WHEREOF, the parties hereto have caused

this Indenture to be duly executed, all as of the day and year first above

written.

 

	

   

  	

  SINCLAIR BROADCAST GROUP, INC., as Issuer

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President and CEO

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  J. Duncan Smith

  	

   

  
	

  Title:   Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  GUARANTORS:

  
	

   

  	

   

  
	

   

  	

  CHESAPEAKE TELEVISION, INC.

  
	

   

  	

  KSMO, INC.

  
	

   

  	

  WCGV, INC.

  
	

   

  	

  SINCLAIR ACQUISITION IV, INC.

  
	

   

  	

  WLFL, INC.

  
	

   

  	

  SINCLAIR MEDIA I, INC.

  
	

   

  	

  WSMH, INC.

  
	

   

  	

  SINCLAIR MEDIA II, INC.

  
	

   

  	

  WSTR LICENSEE, INC.

  
	

   

  	

  WGME, INC.

  
	

   

  	

  SINCLAIR MEDIA III, INC.

  
	

   

  	

  WTTE, CHANNEL 28 LICENSEE, INC.

  
	

   

  	

  WTTO, INC.

  
	

   

  	

  WTVZ, INC.

  
	

   

  	

  WYZZ, INC.

  
	

   

  	

  KOCB, INC.

  
	

   

  	

  FSF-TV, INC.

  
	

   

  	

  KSMO LICENSEE, INC.

  
	

   

  	

  WDKY, INC.

  
	

   

  	

  WYZZ LICENSEE, INC.

  
	

   

  	

  KLGT, INC.

  
	

   

  	

  SINCLAIR

  TELEVISION COMPANY II, INC. (F/K/A SINCLAIR ACQUISITION II, INC.)

  
	

   

  	

  SINCLAIR COMMUNICATIONS, INC.

  
	

   

  	

  WSYX LICENSEE, INC.

  
				

 

158

 

	

   

  	

  WGGB, INC.

  
	

   

  	

  WTWC, INC.

  
	

   

  	

  SINCLAIR COMMUNICATIONS II, INC.

  
	

   

  	

  SINCLAIR HOLDINGS I, INC.

  
	

   

  	

  SINCLAIR HOLDINGS II, INC.

  
	

   

  	

  SINCLAIR HOLDINGS III, INC.

  
	

   

  	

  SINCLAIR TELEVISION COMPANY, INC.

  
	

   

  	

  SINCLAIR TELEVISION OF BUFFALO, INC.

  
	

   

  	

  SINCLAIR TELEVISION OF CHARLESTON, INC.

  
	

   

  	

  SINCLAIR TELEVISION OF NASHVILLE, INC.

  
	

   

  	

  SINCLAIR TELEVISION OF NEVADA, INC.

  
	

   

  	

  SINCLAIR TELEVISION OF OKLAHOMA, INC.

  
	

   

  	

  SINCLAIR TELEVISION OF TENNESSEE, INC.

  
	

   

  	

  SINCLAIR TELEVISION LICENSE HOLDER, INC.

  
	

   

  	

  SINCLAIR TELEVISION OF DAYTON, INC.

  
	

   

  	

  SINCLAIR ACQUISITION VII,

  INC.

  
	

   

  	

  SINCLAIR ACQUISITION VIII,

  INC.

  
	

   

  	

  SINCLAIR ACQUISITION IX, INC.

  
	

   

  	

  SINCLAIR ACQUISITION X, INC.

  
	

   

  	

  SINCLAIR ACQUISITION XI, INC.

  
	

   

  	

  SINCLAIR ACQUISITION XII,

  INC.

  
	

   

  	

  MONTECITO BROADCASTING CORPORATION

  
	

   

  	

  CHANNEL 33, INC.

  
	

   

  	

  WNYO, INC.

  
	

   

  	

  NEW YORK TELEVISION, INC.

  
	

   

  	

  BIRMINGHAM (WABM-TV) LICENSEE, INC.

  
	

   

  	

  RALEIGH (WRDC-TV) LICENSEE, INC.

  
	

   

  	

  SAN ANTONIO (KRRT-TV) LICENSEE, INC.

  
	

   

  	

  WVTV LICENSEE, INC.

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President (as to all)

  

 

159

 

	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary (as to all)

  	

   

  
	

   

  	

   

  
	

   

  	

  SINCLAIR PROPERTIES, LLC

  
	

   

  	

  SINCLAIR PROPERTIES II, LLC

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    Manager (as to both)

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Manager (as to both)

  	

   

  
	

   

  	

   

  
	

   

  	

  KBSI LICENSEE L.P.

  
	

   

  	

  KETK LICENSEE L.P.

  
	

   

  	

  WMMP LICENSEE L.P.

  
	

   

  	

  WSYT LICENSEE L.P.

  
	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair Properties, LLC,

  
	

   

  	

  General

  Partner

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    Manager

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Manager 

  	

   

  
	

   

  	

   

  
	

  .

  	

  WEMT LICENSEE L.P

  
	

   

  	

  WKEF LICENSEE L.P.

  
	

   

  	

   

  
	

   

  	

  By:

  	

  Sinclair Properties II, LLC,

  
	

   

  	

  General

  Partner

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    Manager

  
							

 

160

 

	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Manager 

  	

   

  
	

   

  	

   

  
	

   

  	

  WGME LICENSEE LLC

  
	

   

  	

   

  
	

   

  	

  By:

  	

  WGME, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

   

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WICD LICENSEE, LLC

  
	

   

  	

  WICS LICENSEE, LLC

  
	

   

  	

  KGAN LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  Sinclair Acquisition IV, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WSMH LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  WSMH, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
							

 

161

 

	

   

  	

  WPGH LICENSEE, LLC

  
	

   

  	

  KDNL LICENSEE, LLC

  
	

   

  	

  WCWB LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  Sinclair Media I, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WTVZ LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  WTVZ, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  CHESAPEAKE

  TELEVISION LICENSEE, LLC

  
	

   

  	

  KABB LICENSEE, LLC

  
	

   

  	

  SCI - SACRAMENTO LICENSEE, LLC

  
	

   

  	

  WLOS LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  Chesapeake Television, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
							

 

162

 

	

   

  	

  KLGT LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  KLGT, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WCGV LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  WCGV, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  SCI - INDIANA LICENSEE, LLC

  
	

   

  	

  KUPN LICENSEE, LLC

  
	

   

  	

  WEAR LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  Sinclair Media II, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
					

 

163

 

	

   

  	

  WLFL LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  WLFL, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WTTO LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  WTTO, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WTWC LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  WTWC, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
						

 

164

 

	

   

  	

  WGGB LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  WGGB, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  KOCB LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  KOCB, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WDKY LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  WDKY, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
						

 

165

 

	

   

  	

  KOKH LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  Sinclair Television of Oklahoma, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WUPN LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  Sinclair Television of Buffalo, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

   

  	

  Title: 

  President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WUXP LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  Sinclair Television of Tennessee, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:

     Secretary

  	

   

  
									

 

166

 

	

   

  	

  WCHS LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  Sinclair Media III, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  SINCLAIR FINANCE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  KLGT, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
	

   

  	

   

  
	

   

  	

  WMSN LICENSEE, LLC

  
	

   

  	

  WRLH LICENSEE, LLC

  
	

   

  	

  WUTV LICENSEE, LLC

  
	

   

  	

  WXLV LICENSEE, LLC

  
	

   

  	

  WZTV LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By: 

  	

  Sinclair Television

  Company II, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
							

 

167

 

	

   

  	

  WUHF LICENSEE, LLC

  
	

   

  	

   

  
	

   

  	

  By:  

  	

  Sinclair Television

  Company, Inc., Member

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  David D. Smith

  
	

   

  	

  Title:    President

  
	

   

  	

   

  
	

  Attest:

  	

   

  	

   

  
	

  Name:  David B. Amy

  	

   

  
	

  Title:    Secretary

  	

   

  
					

 

168

 

	

   

  	

  FIRST UNION NATIONAL BANK, as Trustee

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Name:  

  
	

   

  	

  Title:    

  

 

169

 

	

  STATE OF

  	

   

  	

  )

  
	

   

  	

   

  	

  )  ss.:

  
	

  COUNTY OF

  	

   

  	

  )

  

 

On the ______ day

of March, 2002, before me personally came David D. Smith, to me known, who,

being by me duly sworn, did depose and say that he resides at 10706 Beaver Dam

Road, Hunt Valley, Maryland 21030; that he is President and Chief Executive

Officer of Sinclair Broadcast Group, Inc., which executed the foregoing

instrument;  that he holds the positions

identified on Annex I hereto with respect to each of the guarantors identified

on Annex I hereto, each of which has executed the foregoing instrument;  and that he signed his name thereto pursuant

to authority of the Boards of Directors of Sinclair Broadcast Group, Inc. and

such guarantors that are corporations, the Boards of Directors of the general

partner of such guarantors that are limited partnerships, and the members or

managers of such guarantors that are limited liability companies.

 

	

  (NOTARIAL

  
	

  SEAL)

  
	

   

  
	

   

  	

   

  

 

170

 

ANNEX I

 

	

  Guarantor

  	

   

  	

  Position

  of David Smith

  
	

  Chesapeake Television,

  Inc.

  	

   

  	

  President

  
	

  KSMO, Inc.

  	

   

  	

  President

  
	

  WCGV, Inc.

  	

   

  	

  President

  
	

  Sinclair Acquisition

  IV, Inc.

  	

   

  	

  President

  
	

  WLFL, Inc.

  	

   

  	

  President

  
	

  Sinclair Media I, Inc.

  	

   

  	

  President

  
	

  WSMH, Inc.

  	

   

  	

  President

  
	

  Sinclair Media II, Inc.

  	

   

  	

  President

  
	

  WSTR Licensee, Inc.

  	

   

  	

  President

  
	

  WGME, Inc.

  	

   

  	

  President

  
	

  Sinclair Media III,

  Inc.

  	

   

  	

  President

  
	

  WTTE, Channel 28

  Licensee, Inc.

  	

   

  	

  President

  
	

  WTTO, Inc.

  	

   

  	

  President

  
	

  WTVZ, Inc.

  	

   

  	

  President

  
	

  WYZZ, Inc.

  	

   

  	

  President

  
	

  KOCB, Inc.

  	

   

  	

  President

  
	

  FSF-TV, Inc.

  	

   

  	

  President

  
	

  KSMO Licensee, Inc.

  	

   

  	

  President

  
	

  WDKY, Inc.

  	

   

  	

  President

  
	

  WYZZ Licensee, Inc.

  	

   

  	

  President

  
	

  KLGT, Inc.

  	

   

  	

  President

  
	

  Sinclair Television Company II, Inc.

  (f/k/a Sinclair Acquisition II, Inc.)

  	

   

  	

  President

  
	

  Sinclair

  Communications, Inc.

  	

   

  	

  President

  
	

  WSYX Licensee, Inc.

  	

   

  	

  President

  
	

  WGGB, Inc.

  	

   

  	

  President

  
	

  WTWC, Inc.

  	

   

  	

  President

  
	

  Sinclair Communications

  II, Inc.

  	

   

  	

  President

  
	

  Sinclair Holdings I,

  Inc.

  	

   

  	

  President

  
	

  Sinclair Holdings II,

  Inc.

  	

   

  	

  President

  
	

  Sinclair Holdings III,

  Inc.

  	

   

  	

  President

  
	

  Sinclair Television

  Company, Inc.

  	

   

  	

  President

  
	

  Sinclair Television of

  Buffalo, Inc.

  	

   

  	

  President

  

 

171

 

	

  Sinclair Television of

  Charleston, Inc.

  	

   

  	

  President

  
	

  Sinclair Television of

  Nashville, Inc.

  	

   

  	

  President

  
	

  Sinclair Television of

  Nevada, Inc.

  	

   

  	

  President

  
	

  Sinclair Television of

  Oklahoma, Inc.

  	

   

  	

  President

  
	

  Sinclair Television of

  Tennessee, Inc.

  	

   

  	

  President

  
	

  Sinclair Television

  License Holder, Inc.

  	

   

  	

  President

  
	

  Sinclair Television of

  Dayton, Inc.

  	

   

  	

  President

  
	

  Sinclair Acquisition

  VII, Inc.

  	

   

  	

  President

  
	

  Sinclair Acquisition

  VIII, Inc.

  	

   

  	

  President

  
	

  Sinclair Acquisition

  IX, Inc.

  	

   

  	

  President

  
	

  Sinclair Acquisition X,

  Inc.

  	

   

  	

  President

  
	

  Sinclair Acquisition

  XI, Inc.

  	

   

  	

  President

  
	

  Sinclair Acquisition

  XII, Inc.

  	

   

  	

  President

  
	

  Montecito Broadcasting Corporation, Channel 33, Inc.

  	

   

  	

  President

  
	

  WNYO, Inc.

  	

   

  	

  President

  
	

  New York Television,

  Inc.

  	

   

  	

  President

  
	

  Birmingham (WABM-TV) Licensee, Inc.

  	

   

  	

  President

  
	

  Raleigh (WRDC-TV) Licensee, Inc.

  	

   

  	

  President

  
	

  San Antonio (KRRT-TV) Licensee, Inc.

  	

   

  	

  President

  
	

  WVTV Licensee, Inc.

  	

   

  	

  President

  
	

  Sinclair Properties,

  LLC

  	

   

  	

  Manager

  
	

  Sinclair Properties II,

  LLC

  	

   

  	

  Manager

  
	

  KBSI Licensee L.P.

  	

   

  	

  Manager of Sinclair Properties, LLC, the General

  Partner of KBSI Licensee L.P.

  
	

  KETK Licensee L.P.

  	

   

  	

  Manager of Sinclair Properties, LLC, the General

  Partner of KETK Licensee L.P.

  
	

  WMMP Licensee L.P.

  	

   

  	

  Manager of Sinclair Properties, LLC, the General

  Partner of WMMP Licensee L.P.

  
	

  WSYT Licensee L.P.

  	

   

  	

  Manager of Sinclair Properties, LLC, the General

  Partner of WSYT Licensee L.P.

  

 

172

 

	

  WEMT Licensee L.P.

  	

   

  	

  Manager of Sinclair Properties II, LLC, the General

  Partner of WEMT Licensee L.P.

  
	

  WKEF Licensee L.P.

  	

   

  	

  Manager of Sinclair Properties II, LLC, the General

  Partner of WKEF Licensee L.P.

  
	

  WGME Licensee, LLC

  	

   

  	

  President of WGME, Inc., the Sole Member of WGME

  Licensee, LLC

  
	

  WICD Licensee, LLC

  	

   

  	

  President of Sinclair Acquisition IV, Inc., the Sole

  Member of WICD Licensee, LLC

  
	

  WICS Licensee, LLC

  	

   

  	

  President of Sinclair Acquisition IV, Inc., the Sole

  Member of WICD Licensee, LLC

  
	

  KGAN Licensee, LLC

  	

   

  	

  President of Sinclair Acquisition IV, Inc., the Sole

  Member of WICD Licensee, LLC

  
	

  WSMH Licensee, LLC

  	

   

  	

  President of WSMH, Inc., the Sole Member of WSMH Licensee,

  LLC

  
	

  WPGH Licensee, LLC

  	

   

  	

  President of Sinclair Media I, Inc., the Sole Member

  of WPGH Licensee, LLC

  
	

  KDNL Licensee, LLC

  	

   

  	

  President of Sinclair Media I, Inc., the Sole Member

  of WPGH Licensee, LLC

  
	

  WCWB Licensee, LLC

  	

   

  	

  President of Sinclair Media I, Inc., the Sole Member

  of WPGH Licensee, LLC

  
	

  WTVZ Licensee, LLC

  	

   

  	

  President of WTVZ, Inc., the Sole Member of WTVZ

  Licensee, LLC

  
	

  Chesapeake Television

  Licensee, LLC

  	

   

  	

  President of Chesapeake Television, Inc., the Sole

  Member of Chesapeake Television Licensee, LLC

  
	

  KABB Licensee, LLC

  	

   

  	

  President of Chesapeake Television, Inc., the Sole

  Member of Chesapeake Television Licensee, LLC

  
	

  SCI — Sacramento

  Licensee, LLC

  	

   

  	

  President of Chesapeake Television, Inc., the Sole

  Member of Chesapeake Television Licensee, LLC

  
	

  WLOS Licensee, LLC

  	

   

  	

  President of Chesapeake Television, Inc., the Sole

  Member of Chesapeake Television Licensee, LLC

  

 

173

 

	

  KLGT Licensee, LLC

  	

   

  	

  President of KLGT, Inc., the Sole Member of KLGT

  Licensee, LLC

  
	

  WCGV Licensee, LLC

  	

   

  	

  President of WCGV, Inc., the Sole Member of WCGV

  Licensee, LLC

  
	

  SCI — Indiana Licensee,

  LLC

  	

   

  	

  President of Sinclair Media II, Inc., the Sole

  Member of SCI — Indiana Licensee, LLC

  
	

  KUPN Licensee, LLC

  	

   

  	

  President of Sinclair Media II, Inc., the Sole

  Member of SCI — Indiana Licensee, LLC

  
	

  WEAR Licensee, LLC

  	

   

  	

  President of Sinclair Media II, Inc., the Sole

  Member of SCI — Indiana Licensee, LLC

  
	

  WLFL Licensee, LLC

  	

   

  	

  President of WLFL, Inc., the Sole Member of WLFL

  Licensee, LLC

  
	

  WTTO Licensee, LLC

  	

   

  	

  President of WTTO, Inc., the Sole Member of WTTO

  Licensee, LLC

  
	

  WTWC Licensee, LLC

  	

   

  	

  President of WTWC, Inc., the Sole Member of WTWC

  Licensee, LLC

  
	

  WGGB Licensee, LLC

  	

   

  	

  President of WGGB, Inc., the Sole Member of WGGB

  Licensee, LLC

  
	

  KOCB Licensee, LLC

  	

   

  	

  President of KOCB, Inc., the Sole Member of KOCB

  Licensee, LLC

  
	

  WDKY Licensee, LLC

  	

   

  	

  President of WDKY, Inc., the Sole Member of WDKY

  Licensee, LLC

  
	

  KOKH Licensee, LLC

  	

   

  	

  President of Sinclair Television of Oklahoma, Inc.,

  the Sole Member of KOKH Licensee, LLC

  
	

  WUPN Licensee, LLC

  	

   

  	

  President of Sinclair Television of Buffalo, Inc.,

  the Sole Member of WUPN Licensee, LLC

  
	

  WUXP Licensee, LLC

  	

   

  	

  President of Sinclair Television of Tennessee, Inc.,

  the Sole Member of WUXP Licensee, LLC

  
	

  WCHS Licensee, LLC

  	

   

  	

  President of Sinclair Media III, Inc., the Sole

  Member of WCHS Licensee, LLC

  
	

  Sinclair Finance, LLC

  	

   

  	

  President of KLGT, Inc., the Sole Member of Sinclair

  Finance, LLC

  
	

  WMSN Licensee, LLC

  	

   

  	

  President of Sinclair Television Company II, Inc.

  (f/k/a Sinclair Acquisition II, Inc.), the Sole Member of WMSN Licensee, LLC

  
	

  WRLH Licensee, LLC

  	

   

  	

  President of Sinclair Television Company II, Inc.

  (f/k/a Sinclair Acquisition II, Inc.), the Sole Member of WRLH Licensee, LLC

  

 

174

 

	

  WUTV Licensee, LLC

  	

   

  	

  President of Sinclair Television Company II, Inc.

  (f/k/a Sinclair Acquisition II, Inc.), 

  the Sole Member of WUTV Licensee, LLC

  
	

  WXLV Licensee, LLC

  	

   

  	

  President of Sinclair Television Company II, Inc.

  (f/k/a Sinclair Acquisition II, Inc.), the Sole Member of WXLV Licensee, LLC

  
	

  WZTV Licensee, LLC

  	

   

  	

  President of Sinclair Television Company II, Inc.

  (f/k/a Sinclair Acquisition II, Inc.), the Sole Member of WZTV Licensee, LLC

  
	

  WUHF Licensee, LLC

  	

   

  	

  President of Sinclair Television Company , Inc., the

  Sole Member of WUHF Licensee, LLC

  

 

175

 

STATE OF                                       )

)  ss.:

COUNTY OF

________________ )

 

On the ______ day

of March, 2002, before me personally came __________________ , to me known,

who, being by me duly sworn, did depose and say that he resides at

_____________________________________ ; that he is an authorized officer of

First Union National Bank, one of the corporations described in and which

executed the above instrument; that he knows the corporate seal of such

corporation; that the seal affixed to said instrument is such corporate seal;

that it was so affixed pursuant to authority of the Board of Directors of such

corporation; and that he signed his name thereto pursuant to like authority.

 

	

  (NOTARIAL

  
	

  SEAL)

  
	

   

  

 

 

176

 

ANNEX A

 

GUARANTORS

 

Chesapeake Television, Inc., a Maryland corporation,

KSMO, Inc., a Maryland corporation,

WCGV, Inc., a Maryland corporation,

Sinclair Acquisition IV, Inc., a Maryland corporation,

WLFL, Inc., a Maryland corporation,

Sinclair Media I, Inc., a Maryland corporation,

WSMH, Inc., a Maryland corporation,

Sinclair Media II, Inc., a Maryland corporation,

WSTR Licensee, Inc., a Maryland corporation,

WGME, Inc., a Maryland corporation,

Sinclair Media III, Inc., a Maryland corporation,

WTTE, Channel 28 Licensee, Inc., a Maryland

corporation,

WTTO, Inc., a Maryland corporation,

WTVZ, Inc., a Maryland corporation,

WYZZ, Inc., a Maryland corporation,

KOCB, Inc., an Oklahoma corporation,

FSF-TV, Inc., a North Carolina corporation,

KSMO Licensee, Inc., a Delaware corporation,

WDKY, Inc., a Delaware corporation,

WYZZ Licensee, Inc., a Delaware corporation,

KLGT, Inc., a Minnesota corporation,

Sinclair Television Company II, Inc. (f/k/a Sinclair

Acquisition II, Inc.,) a Delaware corporation,

Sinclair Communications, Inc., a Maryland corporation,

WSYX Licensee, Inc., a Maryland corporation,

WGGB, Inc., a Maryland corporation,

WTWC, Inc., a Maryland corporation,

Sinclair Communications II, Inc., a Delaware

corporation,

Sinclair Holdings I, Inc., a Virginia corporation,

Sinclair Holdings II, Inc., a Virginia corporation,

Sinclair Holdings III, Inc., a Virginia corporation,

Sinclair Television Company, Inc., a Delaware

corporation,

Sinclair Television of Buffalo, Inc., a Delaware

corporation,

Sinclair Television of Charleston, Inc., a Delaware

corporation,

Sinclair Television of Nashville, Inc., a Tennessee

corporation,

Sinclair Television of Nevada, Inc., a Nevada

corporation,

Sinclair Television of Oklahoma, Inc., a Delaware

corporation,

Sinclair Television of Tennessee, Inc., a Delaware

corporation,

 

177

 

Sinclair Television of License Holder, Inc., a Nevada

corporation,

Sinclair Television of Dayton, Inc., a Delaware

corporation,

Sinclair Acquisition VII, Inc., a Maryland

corporation,

Sinclair Acquisition VIII, Inc., a Maryland

corporation,

Sinclair Acquisition IX, Inc., a Maryland corporation,

Sinclair Acquisition X, Inc., a Maryland corporation,

Sinclair Acquisition XI, Inc., a Maryland corporation,

Sinclair Acquisition XII, Inc., a Delaware

corporation,

Montecito Broadcasting Corporation, a Delaware

corporation,

Channel 33, Inc., a Nevada corporation,

WNYO, Inc., a Delaware corporation,

New York Television, Inc., a Maryland corporation,

Sinclair Properties, LLC, a Virginia limited liability

company,

Sinclair Properties II, LLC, a Virginia limited

liability company,

KBSI Licensee L.P., a Virginia limited partnership,

KETK Licensee L.P., a Virginia limited partnership,

WMMP Licensee L.P., a Virginia limited partnership,

WSYT Licensee L.P., a Virginia limited partnership,

WEMT Licensee L.P., a Virginia limited partnership,

WKEF Licensee L.P., a Virginia limited partnership,

WGME Licensee, LLC, a Maryland limited liability

company,

WICD Licensee, LLC, a Maryland limited liability

company,

WICS Licensee, LLC, a Maryland limited liability

company,

KGAN Licensee, LLC, a Maryland limited liability

company,

WSMH Licensee, LLC, a Maryland limited liability

company,

WPGH Licensee, LLC, a Maryland limited liability

company,

KDNL Licensee, LLC, a Maryland limited liability

company,

WCWB Licensee, LLC, a Maryland limited liability

company,

WTVZ Licensee, LLC, a Maryland limited liability

company,

Chesapeake Television Licensee, LLC, a Maryland

limited liability company,

KABB Licensee, LLC, a Maryland limited liability

company,

SCI-Sacramento Licensee, LLC, a Maryland limited

liability company,

WLOS Licensee, LLC, a Maryland limited liability

company,

KLGT Licensee, LLC, a Maryland limited liability

company,

WCGV Licensee, LLC, a Maryland limited liability

company,

SCI-Indiana Licensee, LLC, a Maryland limited

liability company,

KUPN Licensee, LLC, a Maryland limited liability

company,

WEAR Licensee, LLC, a Maryland limited liability

company,

WLFL Licensee, LLC, a Maryland limited liability

company,

WTTO Licensee, LLC, a Maryland limited liability

company,

WTWC Licensee, LLC, a Maryland limited liability

company,

WGGB Licensee, LLC, a Maryland limited liability

company,

 

178

 

KOCB Licensee, LLC, a Maryland limited liability

company,

WDKY Licensee, LLC, a Maryland limited liability

company,

KOKH Licensee, LLC, a Maryland limited liability

company,

WUPN Licensee, LLC, a Maryland limited liability

company,

WUXP Licensee, LLC, a Maryland limited liability

company,

WCHS Licensee, LLC, a Maryland limited liability

company,

Sinclair Finance, LLC, a Minnesota limited liability

company

Birmingham (WABM-TV) Licensee, Inc., a Maryland

corporation

Raleigh (WRDC-TV) Licensee, Inc., a Maryland

corporation

San Antonio (KRRT-TV) Licensee, Inc., a Maryland

corporation

WVTV Licensee, Inc., a Maryland corporation

WUHF Licensee, LLC, a Nevada limited liability company

WMSN Licensee, LLC, a Nevada limited liability company

WRLH Licensee, LLC, a Nevada limited liability company

WUTV Licensee, LLC, a Nevada limited liability company

WXLV Licensee, LLC, a Nevada limited liability company

WZTV Licensee, LLC, a Nevada limited liability company

 

179

 

SCHEDULE I

 

EXISTING INDEBTEDNESS OF

SINCLAIR BROADCAST GROUP, INC.

AND ITS RESTRICTED SUBSIDIARIES

 

1.                                       Term Note, dated September 30, 1990,

between Sinclair Broadcast Group, Inc. (as borrower) and Julian S. Smith (as

lender).

 

2.                                       Term

Note, dated September 30, 1990, between Sinclair Broadcast Group, Inc. (as

borrower) and Carolyn C. Smith (as lender).

 

3.                                       Lease

Agreement, dated January 1, 1991, between Chesapeake Television, Inc. (as

lessee) and Keyser Investment Group, Inc. (as lessor), for space located at

2000-2008 W. 41st Street, Baltimore, MD.

 

4.                                       Lease

Agreement, dated April 2, 1987, between Chesapeake Television, Inc. (as lessee)

and Cunningham Communications, Inc. (as lessor), for space located on the

primary Baltimore broadcasting tower at 3900 Hooper Avenue, Baltimore, MD.

 

5.                                       Lease

Agreement, dated March 16, 1988, between Chesapeake Television, Inc. (as

lessee) and Cunningham Communications, Inc. (as lessor), for space located on

the back-up Baltimore broadcasting tower at 1200 N. Rolling Road, Baltimore,

MD.

 

6.                                       Lease

Agreement, dated September 23, 1993, between WPGH, Inc. (as lessee) and

Gerstell Development Limited Partnership (as lessor), for building space

located at 750 Ivory Avenue, Pittsburgh, PA.

 

7.                                       Indenture,

dated as of July 2, 1997, as amended, among Sinclair Broadcast Group, Inc. (as

borrower), the Guarantors named therein (as guarantors) and First Union

National Bank (as trustee).

 

8.                                       Indenture,

dated as of December 17, 1997, between Sinclair Broadcast Group, Inc. and First

Union National Bank, and the First Supplemental Indenture, dated as of December

17, 1997, among Sinclair Broadcast Group, Inc. (as borrower), the Guarantors

named therein (as guarantors) and First Union National Bank (as trustee).

 

9.                                       Credit

Agreement, dated as of May 28, 1998, as amended by Amendment No. 1 dated as of

December 21, 1999 and Amendment No. 2 dated as of July 21, 2000, and as amended

and restated pursuant to an Amendment and Restatement dated as of May 9, 2001,

as amended by Amendment No. 1 as of October 30, 2001, between Sinclair

Broadcast Group, Inc. (as borrower), various subsidiaries of

 

180

 

Sinclair Broadcast Group,

Inc. party thereto (as guarantors), various lenders (as lenders) and The Chase

Manhattan Bank (as agent).  (As of March

14, 2002, giving effect to the use of proceeds of the issue of the Notes, $564

million was outstanding under the $800 million bank credit agreement).

 

10.                                 Lease

Agreement, dated November 14, 2000, between Sinclair Broadcast Group, Inc. (as

lessee) and General Electric Capital Corporations (as lessor), for six AS 400

computers and related equipment/software.

 

11.                                 Lease

Agreement, dated November 19, 1999, between Sinclair Broadcast Group, Inc. (as

lessee) and PBP-3, LP (as lessor) for building space located at Hollow Rd,

Upper Providence Township, PA.  This

property has a second Lease Agreement, dated October 20, 2000, where it is

subleased between Acrodyne Industries, Inc. (as lessee) and Sinclair Broadcast

Group, (as lessor).

 

12.                                 Lease

Agreement, dated August 12, 1999, between KMWB, Inc. (as lessee) and Telefarm,

Inc. (as lessor) for tower and land space located at 960 County Rd F W, Shoreview,

Minnesota.

 

13.                                 Master

Lease Agreement, dated December 1, 2000, between Sinclair Communications, Inc.

(as lessee) and American Tower L.P. (as lessor) for tower space.

 

14.                                 Time

Brokerage Agreement, dated May 31, 1996, has been amended, dated July 17, 1997,

between Chesapeake Television (as programmer) and Anderson (WFBC-TV), Inc. and

Anderson (WFBC-TV) Licensee, Inc. (collectively as licensee) for the television

station WFBC located in Anderson, SC.

 

15.                                 Time

Brokerage Agreement, dated January 5, 1999, between Sinclair Broadcast Group,

Inc. (as programmer) and Bay Television (as licensee) for television station

WTTA located in Tampa, FL.

 

16.                                 Time Brokerage Agreement, dated February

3, 1998, as amended, dated August 21, 1998, as amended, dated February 1, 1999,

an Agreement to Renew and Continue, dated March 27, 2000, and an amendment,

dated February 1, 2002, between Sinclair Media II, Inc. (as programmer) and

Columbus (WTTE-TV) Licensee, Inc. (as licensee) for television station WTTE-TV

located in Columbus, OH.

 

17.                                 Lease

Agreement, dated May 25, 2000, between Sinclair Broadcast Group, Inc. (as

lessee) and Beaver Dam Limited Liability Company (as lessor) for building space

located at 10706 Beaver Dam Rd, Cockeysville, MD.

 

181

 

18.                                 Lease

Agreement, dated December 18, 1998, between Sinclair Communications, Inc. (as

lessee) and Beaver Dam Limited Liability Company (as lessor) for building space

located at 10706 Beaver Dam Rd, Cockeysville, MD.

 

19.                                 Real Estate Loan Note, dated October 10,

1997, between Chesapeake Television, Inc. (as maker) and Joy B. Moul (as payee)

for land space for a tower site located at 12480 Adkins-Elmendorf Rd, San

Antonio, TX.

 

20.                                 Indenture,

dated as of December 10, 2001, among Sinclair Broadcast Group, Inc. (as

borrower), the Guarantors named therein (as guarantors) and First Union

National Bank (as trustee).

 

21.                                 Lease

Agreement, dated, February 13, 2001, between WPTT, Inc. (as lessee) and

Gerstell Development Limited Partnership (as lessor), for tower space located

at 750 Ivory Avenue, Pittsburgh, PA.

 

22.                                 Lease

Agreement, dated, December 26, 2001, between Sinclair Media I, Inc. (as lessee)

and Gerstell Development Limited Partnership (as lessor), for tower space

located at 750 Ivory Avenue, Pittsburgh, PA.

 

23.                                 Indenture,

dated as of March 14, 2002, among Sinclair Broadcast Group, Inc. (as borrower),

the Guarantors named therein (as guarantors) and First Union National Bank (as

trustee).

 

24.                                 Time

Brokerage Agreement, dated July 1, 1998, as amended by Amendment No. 1 dated,

January 31, 2002 by and between Sullivan Broadcasting Company III, Inc. (as

licensee) and Sinclair Communications II, Inc. (as programmer) for television

stations WTAT-TV, located in Charleston, SC, WVAH-TV, located in Charleston,

WV, and WRGT-TV, located in Dayton, OH.

 

25.                                 Programming

Services Agreement, dated July 14, 1995, as amended, dated July 24, 1995, an

Agreement to Renew and Continue, dated March 27, 2000, and an amendment, dated

February 1, 2002, between Chesapeake Television, Inc. (as programmer),

Baltimore (WNUV-TV), Inc. and Baltimore (WNUV-TV) Licensee, Inc. (collectively

as licensee) for television station WNUV-TV, located in Baltimore, MD.

 

182

 

SCHEDULE II

 

EXISTING LIENS

 

Liens relating to the below identified debt

instruments:

 

1.                                       Bank

Credit Agreement, including any Hedge Agreement relating thereto.

 

2.                                       Term

Note dated September 30, 1990, between Sinclair Broadcast Group, Inc. (as

borrower) and Julian S. Smith (as lender).

 

3.                                       Term

Note dated September 30, 1990, between Sinclair Broadcast Group, Inc. (as

borrower) and Carolyn C. Smith (as lender).

 

183

 

SCHEDULE III

 

EXISTING ENCUMBRANCES AND RESTRICTIONS

Notes

 

1.               Encumbrances and

restrictions under the Bank Credit Agreement and Founders’ Notes.

 

2.               Indenture, dated as

of August 28, 1995, as amended, among Sinclair Broadcast Group, Inc. (as

borrower), the Guarantors named therein, (as guarantors), and United States

Trust Company of New York (as trustee).

 

3.               Indenture, dated as

of July 2, 1997, as amended, among Sinclair Broadcast Group, Inc. (as

borrower), the Guarantors named therein, (as guarantors), and First Union

National Bank (as trustee).

 

4.               Indenture, dated as of December 17, 1997, between

Sinclair Broadcast Group, Inc. (as borrower) and First Union National Bank (as

trustee), and the First Supplemental Indenture, dated as of December 17, 1997

as amended, among Sinclair Broadcast Group, Inc. (as borrower), the Guarantors

named therein (as guarantors) and First Union National Bank (as trustee).

 

5.               Indenture, dated as of December 10, 2001, among

Sinclair Broadcast Group, Inc. (as borrower), the Guarantors named therein (as

guarantors) and First Union National Bank (as trustee).

 

6.               The restrictions,

if any, contained in the terms of the Company’s Series B Convertible Preferred

Stock, par value $.01 per share.

 

7.               The restrictions,

if any, contained in the terms of the Company’s Series C Preferred Stock, par

value $.01 per share.

 

8.               The restrictions,

if any, contained in the terms of the Company’s Series D Convertible

Exchangeable Preferred Stock, par value $.01 per share

 

184

 

EXHIBIT A

REGULATION S

CERTIFICATE

 

(For transfers

pursuant to § 307(a)(i) of the Indenture)

 

First Union

National Bank

_____________________

_____________________

 

Re:     8% Senior Subordinated Notes due 2012 of

Sinclair Broadcast

Group, Inc. (the

“Securities”)

 

Reference is made

to the Indenture, dated as of March 14, 2002 (the “Indenture”), among Sinclair

Broadcast Group, Inc., a Maryland corporation (the “Company”), the guarantors

named therein, and First Union National Bank, as Trustee.  Terms used herein and defined in the

Indenture or in Regulation S or Rule 144 under the U.S. Securities Act of 1933

(the “Securities Act”) are used herein as so defined.

 

This certificate

relates to US$____________ principal amount of Securities, which are evidenced

by the following certificate(s) (the “Specified Securities”):

 

CUSIP No(s).

___________________________

 

CERTIFICATE No(s).

_____________________

 

The person in

whose name this certificate is executed below (the “Undersigned”) hereby

certifies that either (i) it is the sole beneficial owner of the Specified

Securities or (ii) it is acting on behalf of all the beneficial owners of the

Specified Securities and is duly authorized by them to do so.  Such beneficial owner or owners are referred

to herein collectively as the “Owner.” 

The Specified Securities are represented by a Global Security and are

held through the Depositary or an Agent Member in the name of the Undersigned,

as or on behalf of the Owner.

 

The Owner has

requested that the Specified Securities be transferred to a person (the

“Transferee”) who will take delivery in the form of a Regulation S Global

Security.  In connection with such

transfer, the Owner hereby certifies that, unless such transfer is being effected

pursuant to an  effective registration

statement under the Securities Act, it is being effected in accordance with

Rule 904 or Rule 144 under the Securities Act and with all applicable

securities laws of the states of the United States and other 

 

1

 

jurisdictions.  Accordingly, the Owner hereby further

certifies as follows:

 

(1)           Rule 904 Transfers.  If the transfer is being effected in

accordance with Rule 904:

 

(A)          the Owner is not a distributor of the

Securities, an affiliate of the Company or any such distributor or a person

acting on behalf of any of the foregoing;

 

(B)           the offer of the Specified Securities

was not made to a person in the United States;

 

(C)           either:

 

(i)     at the time the buy order was originated,

the Transferee was outside the United States or the Owner and any person acting

on its behalf reasonably believed that the Transferee was outside the United

States, or

 

(ii)   the transaction is being executed in, on or

through the facilities of the Eurobond market, as regulated by the Association

of International Bond Dealers, or another designated offshore securities market

and neither the Owner nor any person acting on its behalf knows that the

transaction has been prearranged with a buyer in the United States;

 

(D)          no directed selling efforts have been

made in the United States by or on behalf of the Owner or any affiliate

thereof;

 

(E)           if the Owner is a dealer in

securities or has received a selling concession, fee or other remuneration in

respect of the Specified Securities, and the transfer is to occur during the

Restricted Period, then the requirements of Rule 904(c)(1) have been satisfied;

and

 

(F)           the transaction is not part of a plan

or scheme to evade the registration requirements of the Securities Act.

 

(2)           Rule 144 Transfers.  If the transfer is being effected pursuant

to Rule 144:

 

(A)          the transfer is occurring after a

holding period of at 

 

2

 

least one year

(computed in accordance with paragraph (d) of Rule 144) has elapsed since the

Specified Securities were last acquired from the Company or from an affiliate

of the Company, whichever is later, and is being effected in accordance with

the applicable amount, manner of sale and notice requirements of Rule 144; or

 

(B)           the transfer is occurring after a

holding period of at least two years has elapsed since the Specified Securities

were last acquired from the Company or from an affiliate of the Company,

whichever is later, and the Owner is not, and during the preceding three months

has not been, an affiliate of the Company.

 

3

 

This certificate and the

statements contained herein are made for your benefit and the benefit of the

Company and the Initial Purchasers.

 

Dated:

	

   

  	

  (Print the name of the Undersigned, as such term is

  defined in the second paragraph of this certificate.)

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

  Title:

  
	

   

  	

   

  
	

   

  	

  (If the Undersigned is a corporation, partnership or

  fiduciary, the title of the person signing on behalf of the Undersigned must

  be stated.)

  
	

   

  	

   

  

4

 

EXHIBIT B

 

[Form of

Restricted Securities Transfer Certificate]

 

RESTRICTED

SECURITIES TRANSFER CERTIFICATE

 

(For transfers

pursuant to Section 307(a)(ii) of

the Indenture referred to below)

 

First Union National Bank,

as Securities Registrar

[                             ]

[                             ]

 

Re:                   8%

Senior Subordinated Notes Due 2012 (the “Securities”)

 

Reference is made to the Indenture, dated as of March 14, 2002 (the

“Indenture”), among Sinclair Broadcast Group, Inc., a Maryland corporation, the

guarantors party thereto and First Union National Bank, as trustee.  Terms used herein and defined in the

Indenture, Rule 144A or Rule 144 under the U.S. Securities Act of 1933 (the

“Securities Act”) are used herein as so defined.

 

This certificate relates to $_____________ aggregate principal amount

of Securities, which are evidenced by the following certificate(s) (the

“Specified Securities”):

 

CUSIP No(s). ___________________________

 

CERTIFICATE No(s). _____________________

 

CURRENTLY IN BOOK-ENTRY FORM:  

Yes ____   No ____ (check one)

 

The person in whose name this certificate is executed below (the

“Undersigned”) hereby certifies that either (i) it is the sole beneficial owner

of the Specified Securities or (ii) it is acting on behalf of all the

beneficial owners of the Specified Securities and is duly authorized by them to

do so. Such beneficial owner or owners are referred to herein collectively as

the “Owner”.  If the Specified

Securities are represented by a Global Security, they are held through a

Depositary (except in the name of “The Depository Trust Company”) or an Agent

Member in the name of the Undersigned, as or on behalf of the Owner. If the

Specified Securities are not represented 

 

5

 

by a Global Security, they are registered in the name of the

Undersigned, as or on behalf of the Owner.

 

The Owner has requested that the Specified Securities be transferred to

a person (the “Transferee”) who will take delivery in the form of a Restricted

Security. In connection with such transfer, the Owner hereby certifies that,

unless such transfer is being effected pursuant to an effective registration

statement under the Securities Act, it is being effected in accordance with

Rule 144A or Rule 144 under the Securities Act and all applicable securities

laws of the states of the United States. 

Accordingly, the Owner hereby further certifies as:

 

(1)                                  Rule

144A Transfers.  If the transfer is

being effected in accordance with Rule 144A:

 

(A)                              the

Specified Securities are being transferred to a person that the Owner and any

person acting on its behalf reasonably believe is a “qualified institutional

buyer” within the meaning of Rule 144A, acquiring for its own account or for

the account of a qualified institutional buyer; and

 

(B)                                the

Owner and any person acting on its behalf have taken reasonable steps to ensure

that the Transferee is aware that the Owner may be relying on Rule 144A in

connection with the transfer; and

 

(2)                                  Rule

144 Transfers.  If the transfer is

being effected pursuant to Rule 144:

 

(A)                              the

transfer is occurring after a holding period of at least one year (computed in

accordance with paragraph (d) of Rule 144) has elapsed since the date the

Specified Securities were acquired from the Company or from an affiliate (as

such term is defined in Rule 144) of the Company, whichever is later, and is

being effected in accordance with the applicable amount, manner of sale and notice

requirements of paragraphs (e), (f) and (h) of Rule 144;

 

(B)                                the

transfer is occurring after a holding period by the Owner of at least two years

has elapsed since the date the Specified Securities were acquired from the

Company or from an affiliate (as such term is defined in Rule 144) of the

Company, whichever is later, and the Owner is not, and during the preceding

three months has not been, an affiliate of the Company; or

 

6

 

This certificate

and the statements contained herein are made for your benefit and the benefit

of the Company.

 

Dated:_____________________

 

	

   

  	

  (Print the name of the Undersigned, as such term is

  defined in the second paragraph of this certificate.)

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

  Title:

  
	

   

  	

   

  
	

   

  	

  (If the Undersigned is a corporation, partnership or

  fiduciary, the title of the person signing on behalf of the Undersigned must

  be stated.)

  
				

 

7

 

EXHIBIT C

 

UNRESTRICTED

SECURITIES CERTIFICATE

 

(For removal of

Securities Act Legends pursuant to § 307(b))

 

First Union

National Bank

_____________________

_____________________

 

Re:      8% Senior Subordinated Notes due 2012 of

Sinclair

Broadcast Group,

Inc. (the “Securities”) 

 

Reference is made

to the Indenture, dated as of March 15, 2002, among Sinclair Broadcast Group,

Inc., a Maryland corporation (the “Company”), the guarantors named therein, and

First Union National Bank, as Trustee. 

Terms used herein and defined in the Indenture or in Rule 144 under the

U.S. Securities Act of 1933 (the “Securities Act”) are used herein as so

defined.

 

This certificate

relates to US$_____________ principal amount of Securities, which are evidenced

by the following certificate(s) (the “Specified Securities”):

 

CUSIP No(s). ___________________________

 

CERTIFICATE No(s).

_____________________

 

The person in

whose name this certificate is executed below (the “Undersigned”) hereby

certifies that either (i) it is the sole beneficial owner of the Specified

Securities or (ii) it is acting on behalf of all the beneficial owners of the

Specified Securities and is duly authorized by them to do so.  Such beneficial owner or owners are referred

to herein collectively as the “Owner”. 

If the Specified Securities are represented by a Global Security, they

are held through the Depositary or an Agent Member in the name of the

Undersigned, as or on behalf of the Owner. 

If the Specified Securities are not represented by a Global Security,

they are registered in the name of the Undersigned, as or on behalf of the

Owner.

 

The Owner has

requested that the Specified Securities be exchanged for Securities bearing no

Private Placement Legend pursuant to Section 307(b) of the Indenture.  In connection with such exchange, the Owner

hereby certifies that the exchange is occurring after a holding period of at

least two years (computed in accordance with paragraph (d) of Rule 144) has

elapsed since the Specified Securities were last acquired from the Company or

from an affiliate of the Company, whichever is later, and the Owner is not, and

during 

 

 

the preceding

three months has not been, an affiliate of the Company.  The Owner also acknowl­edges that any future

transfers of the Specified Securities must comply with all applicable

securities laws of the states of the United States and other jurisdictions.

 

This certificate

and the statements contained herein are made for your benefit and the benefit

of the Company and the Initial Purchasers.

 

Dated:

 

	

   

  	

  (Print the name of the Undersigned, as such term is

  defined in the second paragraph of this certificate.)

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

  Title:

  
				

 

(If the

Undersigned is a corporation, partnership or fiduciary, the title of the person

signing on behalf of the Undersigned

 

 

EXHIBIT D

 

INTERCOMPANY NOTE

____________, 2002

 

Evidences of all loans or advances (“Loans”) hereunder

shall be reflected on the grid attached hereto.  FOR VALUE RECEIVED, _____________, a __________ corporation (the

“Maker”), HEREBY PROMISES TO PAY ON DEMAND to the order of ______________ (the

“Holder”) the principal sum of the aggregate unpaid principal amount of all

Loans (plus accrued interest thereon) at any time and from time to time made

hereunder to which has not been previously paid.

 

All capitalized terms used herein that are defined in,

or by reference in, the Indenture among Sinclair Broadcast Group, Inc., a

Maryland corporation (the “Company”), the guarantors party thereto and First

Union National Bank, as trustee, dated as of March 15, 2002 (the “Indenture”),

have the meanings assigned to such terms therein, or by reference therein,

unless otherwise defined.

 

ARTICLE I

 

TERMS OF INTERCOMPANY

NOTE

 

Section 1.01 Note Forgivable.  Unless the Maker of the Loan hereunder is

either of the Company or any Guarantor, the Holder may not forgive any amounts

owing under this intercompany note.

 

Section 1.02 Interest; Prepayment.  (a)  The interest rate (“Interest

Rate”) on the Loans shall be a rate per annum reflected on the grid attached

hereto.

 

(b)           The

interest, if any, payable on each of the Loans shall accrue from the date such

Loan is made and, subject to Section 2.01, shall be payable upon demand of

the Holder.

 

(c)           If

the principal or accrued interest, if any, of the Loans is not paid on the date

demand is made, interest on the unpaid principal and interest will accrue at a

rate equal to the Interest Rate, if any, plus 100 basis points per annum

from maturity until the principal and interest on such Loans are fully paid.

 

(d)           Subject

to Section 2.01, any amounts hereunder may be prepaid at any time by the

Maker.

 

Section 1.03.  Subordination.  All loans made to either of the Company or

any Guarantor shall be subordinated in right of payment to the payment and

performance 

 

 

of the obligations of the Company and any Subsidiary under the Indenture,

the Securities, the Guarantees or any other Indebtedness ranking senior to or pari

passu with the Securities, or any Guarantors, including, without

limitation, any Indebtedness incurred under the Bank Credit Agreement; provided

that with respect to a Subsidiary in any specific instance, such Subsidiary is

also an obligor under the Indenture, the Securities, a Guarantee or such other

senior or pari  passu Indebtedness, as the case may be, whether as

a borrower, guarantor or pledgor of collateral.

 

ARTICLE II

 

EVENTS OF DEFAULT

 

Section 2.01.  Events of Default.  If after the date of issuance of this Loan

(i) an Event of Default has occurred under the Indenture, (ii) an

“Event of Default” (as defined) has occurred under the Bank Credit Agreement,

or any refinancing of the Bank Credit Agreement or (iii) an “event of

default” (as defined) on any other Indebtedness of the Company or any Guarantor

then (x) in the event of the Maker is not either one of the Company or a

Guarantor, all amounts owing under the Loans hereunder shall be immediately due

and payable to the Holder, and (y) in the event the Maker is either the

Company or, the amounts owing under the Loans hereunder shall not be due and

payable, the amounts owing under the Loans hereunder shall not be due and

payable; provided, however, that if such Event of Default or

event of default has been waived, cured or rescinded, such amounts shall no

longer be due and payable in the case of clause (x), and such amounts may

be payable in the case of clause (y). 

If the Holder is a Subsidiary, then the Holder hereby agrees that if it

receives any payments or distributions on any Loan from the Company or a

Guarantor which is not payable pursuant to clause (y) of the prior

sentence after any Event of Default or event or default described in

clauses (i), (ii) or (iii) above has occurred, is continuing and has not

been waived, cured or rescinded, it will pay over and deliver forthwith to the

Company or such Guarantor, as the case may be, all such payments and distributions.

 

ARTICLE III

 

MISCELLANEOUS

 

Section 3.01  Amendments,

Etc.  No amendment or waiver

of any provision of this intercompany note, or consent to depart herefrom is

permitted at any time for any reason, except with the consent of the Holders of

not less than a majority in aggregate principal amount of the Outstanding

Securities.

 

Section 3.02  Assignment.  No party to this Agreement may assign, in

whole or in part, any of its rights and obligations under this intercompany

note, except to its legal successor in interest.

 

2

 

Section 3.03  Third Party

Beneficiaries.  The holders of the

Securities or any other Indebtedness ranking pari  passu with or

senior to, the Securities or any Guarantees, including without limitation, any

Indebtedness incurred under the Bank Credit Agreement, shall be third party

beneficiaries to this intercompany note and shall have the right to enforce

this intercompany note against the Company or any of their Subsidiaries.

 

Section 3.04  Headings.  Article and Section headings in this

intercompany note are included for convenience of reference only and shall not

constitute a part of this intercompany note for any other purpose.

 

Section 3.05  Entire Agreement.  This intercompany note sets forth the entire

agreement or the parties with respect to its subject matter and supersedes all

previous understandings, written or oral, in respect thereof.

 

Section 3.06  GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY AND

CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING

EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF).

 

Section 3.07  Waivers.  The Maker hereby waives presentment, demand

for payment, notice of protest and all other demands and notices in connection

with the delivery, acceptance, performance or enforcement hereof.

 

	

  By:

  	

   

  

 

3

 

BORROWINGS,

MATURITIES, AND PAYMENTS OF PRINCIPAL

 

	

  

  

  Date

  	

   

  	

  Amount of 

  Borrowing/ 

  Principal

  	

   

  	

  Maturity

  of 

  Borrowing/ 

  Principal

  	

   

  	

  Amount 

  Principal Paid 

  or Prepaid

  	

   

  	

  Unpaid 

  Principal 

  Balance

  	

   

  	

  

  Notation 

  Made by

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  

 

 

SINCLAIR BROADCAST GROUP, INC., as Issuer,

 

THE GUARANTORS IDENTIFIED ON ANNEX A HERETO, as

Guarantors,

 

and

 

FIRST UNION NATIONAL BANK, as Trustee

 

                

 

INDENTURE

 

Dated as of March 14, 2002

 

                 

 

$300,000,000

 

8% Senior Subordinated Notes due 2012

 

 

TABLE OF CONTENTS

 

 

	

  PARTIES

  	

   

  
	

   

  	

   

  
	

  RECITALS

  	

   

  
	

   

  	

   

  
	

  ARTICLE

  ONE  DEFINITIONS AND OTHER PROVISIONS

  OF GENERAL APPLICATION

  
	

   

  
	

  Section

  101.  Definitions.

  
	

   

  	

  “Acquired

  Indebtedness”

  
	

   

  	

  “Affiliate”

  
	

   

  	

  “Agent Member”

  
	

   

  	

  “Applicable Procedures”

  
	

   

  	

  “Asset Sale”

  
	

   

  	

  “Asset Swap”

  
	

   

  	

  “Average Life to Stated

  Maturity”

  
	

   

  	

  “Bank Credit Agreement”

  
	

   

  	

  “Bankruptcy Law”

  
	

   

  	

  “Board of Directors”

  
	

   

  	

  “Board

  Resolution”

  
	

   

  	

  “Business Day”

  
	

   

  	

  “Capital Lease Obligation”

  
	

   

  	

  “Cash

  Equivalents”

  
	

   

  	

  “Change of

  Control”

  
	

   

  	

  “Clearstream”

  
	

   

  	

  “Code”

  
	

   

  	

  “Commission”

  
	

   

  	

  “Company”

  
	

   

  	

  “Company

  Request” or “Company Order”

  
	

   

  	

  “Consolidated Interest

  Expense”

  
	

   

  	

  “Consolidated Net

  Income (Loss)”

  
	

   

  	

  “Consolidated

  Net Worth”

  
	

   

  	

  “Consolidation”

  
	

   

  	

  “Corporate

  Trust Office”

  
	

   

  	

  “Cumulative

  Consolidated Interest Expense”

  
	

   

  	

  “Cumulative Operating

  Cash Flow”

  
	

   

  	

  “Debt to Operating

  Cash Flow Ratio”

  
			

 

i

 

	

   

  	

  “Default”

  
	

   

  	

  “Depositary”

  
	

   

  	

  “Designated

  Guarantor Senior Indebtedness”

  
	

   

  	

  “Designated Senior

  Indebtedness”

  
	

   

  	

  “Disqualified Equity

  Interests”

  
	

   

  	

  “Equity

  Interest”

  
	

   

  	

  “Euroclear”

  
	

   

  	

  “Event of

  Default”

  
	

   

  	

  “Exchange Act”

  
	

   

  	

  “Exchange Offer”

  
	

   

  	

  “Exchange Offer

  Registration Statement”

  
	

   

  	

  “Fair Market

  Value”

  
	

   

  	

  “Film Contract”

  
	

   

  	

  “Founders’

  Notes”

  
	

   

  	

  “Generally

  Accepted Accounting Principles” or “GAAP”

  
	

   

  	

  “Global

  Security”

  
	

   

  	

  “Guarantee”

  
	

   

  	

  “Guaranteed

  Debt”

  
	

   

  	

  “Guarantor”

  
	

   

  	

  “Guarantor Senior

  Indebtedness”

  
	

   

  	

  “Holder”

  
	

   

  	

  “Indebtedness”

  
	

   

  	

  “Indenture”

  
	

   

  	

  “Indenture

  Obligations”

  
	

   

  	

  “Independent

  Director”

  
	

   

  	

  “Initial

  Purchasers”

  
	

   

  	

  “Initial

  Securities”

  
	

   

  	

  “Interest

  Payment Date”

  
	

   

  	

  “Interest

  Rate Agreements”

  
	

   

  	

  “Investments”

  
	

   

  	

  “Issue Date”

  
	

   

  	

  “Lien”

  
	

   

  	

  “Local Marketing Agreement”

  
	

   

  	

  “Maturity”

  
	

   

  	

  “Moody’s”

  
	

   

  	

  “Net Cash

  Proceeds”

  
	

   

  	

  “Non-payment

  Default”

  
	

   

  	

  “Officers’

  Certificate”

  
	

   

  	

  “Operating

  Cash Flow”

  
	

   

  	

  “Opinion

  of Counsel”

  
	

   

  	

  “Opinion of Independent

  Counsel”

  
	

   

  	

  “Outstanding”

  

 

ii

 

	

   

  	

  “Pari

  Passu Indebtedness”

  
	

   

  	

  “Paying Agent”

  
	

   

  	

  “Payment

  Default”

  
	

   

  	

  “Permitted

  Guarantor Junior Securities”

  
	

   

  	

  “Permitted

  Holders”

  
	

   

  	

  “Permitted

  Indebtedness”

  
	

   

  	

  “Permitted

  Investment”

  
	

   

  	

  “Permitted Junior

  Securities”

  
	

   

  	

  “Permitted

  Subsidiary Indebtedness”

  
	

   

  	

  “Person”

  
	

   

  	

  “Predecessor

  Security”

  
	

   

  	

  “Preferred Equity Interest”

  
	

   

  	

  “Prospectus”

  
	

   

  	

  “Public

  Equity Offering”

  
	

   

  	

  “Qualified Equity

  Interests”

  
	

   

  	

  “Redemption

  Date”

  
	

   

  	

  “Redemption

  Price”

  
	

   

  	

  “Registration Rights

  Agreement”

  
	

   

  	

  “Registration

  Statement”

  
	

   

  	

  “Regular

  Record Date”

  
	

   

  	

  “Regulation S”

  
	

   

  	

  “Regulation S

  Global Securities”

  
	

   

  	

  “Responsible

  Officer”

  
	

   

  	

  “Restricted

  Payment”

  
	

   

  	

  “Restricted Securities

  Legend”

  
	

   

  	

  “Restricted

  Securities Transfer Certificate”

  
	

   

  	

  “Restricted

  Security”

  
	

   

  	

  “Restricted

  Subsidiary”

  
	

   

  	

  “Rule 144”

  
	

   

  	

  “Rule 144A Global

  Securities”

  
	

   

  	

  “Rule

  144A Information”

  
	

   

  	

  “Sale and Leaseback

  Transaction”

  
	

   

  	

  “S&P”

  
	

   

  	

  “Securities”

  
	

   

  	

  “Securities Act”

  
	

   

  	

  “Security

  Register” and “Security Registrar”

  
	

   

  	

  “Senior

  Indebtedness”

  
	

   

  	

  “Series

  A Securities”

  
	

   

  	

  “Series

  B Securities”

  
	

   

  	

  “Shelf Registration

  Statement”

  
	

   

  	

  “Special

  Record Date”

  
	

   

  	

  “Stated

  Maturity”

  

 

iii

 

	 
	

   

  	

  “Subordinated Indebtedness”

  
	 
	

   

  	

  “Subsidiary”

  
	 
	

   

  	

  “Successor

  Security”

  
	 
	

   

  	

  “Temporary Cash

  Investments”

  
	 
	

   

  	

  “Trust

  Indenture Act”

  
	 
	

   

  	

  “Trustee”

  
	 
	

   

  	

  “Unrestricted

  Subsidiary”

  
	 
	

   

  	

  “Unrestricted

  Subsidiary Indebtedness”

  
	 
	

   

  	

  “U.S. Person”

  
	 
	

   

  	

  “Voting Stock”

  
	 
	

   

  	

  “Wholly Owned

  Restricted Subsidiary”

  
	

  Section

  102.  Other Definitions.

  	 

	

  Section

  103. 

  Compliance Certificates and Opinions.

  	 

	

  Section

  104. 

  Form of Documents Delivered to Trustee.

  	 

	

  Section 105.  Acts of Holders.

  	 

	

  Section

  106. 

  Notices, etc., to Trustee, the Company

  and any Guarantor.

  	 

	

  Section

  107. 

  Notice to Holders; Waiver.

  	 

	

  Section

  108. 

  Conflict with Trust Indenture Act.

  	 

	

  Section

  109. 

  Effect of Headings and Table of Contents.

  	 

	

  Section

  110. 

  Successors and Assigns.

  	 

	

  Section

  111.  Separability Clause.

  	 

	

  Section

  112.  Benefits of Indenture.

  	 

	

  Section 113.  Governing Law.

  	 

	

  Section 114.  Legal Holidays.

  	 

	

  Section

  115. 

  Schedules and Exhibits.

  	 

	

  Section 116.  Counterparts.

  	 

	

   

  	 

	

  ARTICLE

  TWO  SECURITY FORMS

  	 

	

   

  	 

	

  Section 201.  Forms Generally.

  	 

	

  Section

  202. 

  Form of Face of Security.

  	 

	

  Section

  203. 

  Form of Reverse of Securities.

  	 

	

  Section

  204.  Additional Provisions Required

  in Global Security.

  	 

	

  Section

  205. 

  Form of Trustee’s Certificate of Authentication.

  	 

	

  Section

  206. 

  Form of Guarantee of Each of the

  Guarantors.

  	 

	

   

  	 

	

  ARTICLE

  THREE  THE SECURITIES

  	 

	

   

  	 

	

  Section

  301.  Title and Terms.

  	 

	

  Section 302.  Denominations.

  	 

	

  Section

  303. 

  Execution, Authentication, Delivery and Dating.

  	 

	

  Section

  304.  Temporary Securities.

  	 

	

  Section 305.  Global Securities.

  	 

				

 

iv

 

	

  Section

  306.  Registration, Registration of

  Transfer and Exchange.

  
	

  Section

  307.  Special Transfer Provisions

  
	

  Section

  308. 

  Mutilated, Destroyed, Lost and Stolen Securities.

  
	

  Section

  309.  Payment of Interest; Interest Rights

  Preserved.

  
	

  Section

  310.  Persons Deemed Owners.

  
	

  Section 311.  Cancellation.

  
	

  Section

  312. 

  Computation of Interest.

  
	

  Section

  313.  CUSIP Numbers.

  
	

   

  
	

  ARTICLE

  FOUR  DEFEASANCE AND COVENANT

  DEFEASANCE

  
	

   

  
	

  Section

  401.  Company’s Option to Effect

  Defeasance or Covenant Defeasance.

  
	

  Section

  402. 

  Defeasance and Discharge.

  
	

  Section

  403.  Covenant Defeasance.

  
	

  Section

  404. 

  Conditions to Defeasance or Covenant Defeasance.

  
	

  Section

  405.  Deposited Money and U.S.

  Government Obligations to Be Held in Trust; Other Miscellaneous Provisions.

  
	

  Section 406.  Reinstatement.

  
	

   

  
	

  ARTICLE

  FIVE  REMEDIES

  
	

   

  
	

  Section

  501.  Events of Default.

  
	

  Section

  502. 

  Acceleration of Maturity; Rescission and

  Annulment.

  
	

  Section

  503.  Collection of Indebtedness and

  Suits for Enforcement by Trustee.

  
	

  Section

  504. 

  Trustee May File Proofs of Claim.

  
	

  Section

  505. 

  Trustee May Enforce Claims without

  Possession of Securities.

  
	

  Section

  506. 

  Application of Money Collected.

  
	

  Section

  507.  Limitation on Suits.

  
	

  Section

  508.  Unconditional Right of Holders

  to Receive Principal, Premium and Interest.

  
	

  Section

  509. 

  Restoration of Rights and Remedies.

  
	

  Section

  510. 

  Rights and Remedies Cumulative.

  
	

  Section

  511. 

  Delay or Omission Not Waiver.

  
	

  Section

  512.  Control by Holders.

  
	

  Section

  513. 

  Waiver of Past Defaults.

  
	

  Section

  514.  Undertaking for Costs.

  
	

  Section

  515. 

  Waiver of Stay, Extension or Usury Laws.

  
	

   

  
	

  ARTICLE

  SIX  THE TRUSTEE

  
	

   

  
	

  Section

  601.  Notice of Defaults.

  

 

v

 

	

  Section

  602. 

  Certain Rights of Trustee.

  
	

  Section

  603.  Trustee Not Responsible for

  Recitals, Dispositions of Securities or Application of Proceeds Thereof.

  
	

  Section

  604. 

  Trustee and Agents May Hold Securities;

  Collections; etc.

  
	

  Section

  605. 

  Money Held in Trust.

  
	

  Section

  606.  Compensation and Indemnification

  of Trustee and Its Prior Claim.

  
	

  Section

  607.  Conflicting Interests.

  
	

  Section

  608. 

  Corporate Trustee Required; Eligibility.

  
	

  Section

  609. 

  Resignation and Removal; Appointment of

  Successor Trustee.

  
	

  Section

  610. 

  Acceptance of Appointment by Successor.

  
	

  Section

  611. 

  Merger, Conversion, Consolidation or

  Succession to Business.

  
	

  Section

  612. 

  Preferential Collection of Claims Against Company.

  
	

   

  
	

  ARTICLE

  SEVEN  HOLDERS’ LISTS AND REPORTS BY

  TRUSTEE AND COMPANY

  
	

   

  
	

  Section

  701. 

  Company to Furnish Trustee Names and

  Addresses of Holders.

  
	

  Section

  702. 

  Disclosure of Names and Addresses of Holders.

  
	

  Section

  703.  Reports by Trustee.

  
	

  Section

  704. 

  Reports by Company and Guarantors.

  
	

   

  
	

  ARTICLE

  EIGHT  CONSOLIDATION, MERGER,

  CONVEYANCE, TRANSFER OR LEASE

  
	

   

  
	

  Section

  801.  Company or Any Guarantor May

  Consolidate, etc., Only on Certain Terms.

  
	

  Section

  802.  Successor Substituted.

  
	

   

  
	

  ARTICLE

  NINE  SUPPLEMENTAL INDENTURES

  
	

   

  
	

  Section

  901.  Supplemental Indentures and

  Agreements without Consent of Holders.

  
	

  Section 902.  Supplemental Indentures and Agreements

  with Consent of Holders.

  
	

  Section

  903. 

  Execution of Supplemental Indentures and

  Agreements.

  
	

  Section

  904. 

  Effect of Supplemental Indentures.

  
	

  Section

  905. 

  Conformity with Trust Indenture Act.

  
	

  Section

  906.  Reference in Securities to Supplemental

  Indentures.

  
	

  Section

  907. 

  Effect on Senior Indebtedness.

  

 

vi

 

	

  ARTICLE

  TEN  COVENANTS

  
	

   

  
	

  Section

  1001. 

  Payment of Principal, Premium and Interest.

  
	

  Section

  1002. 

  Maintenance of Office or Agency.

  
	

  Section

  1003. 

  Money for Security Payments to Be Held

  in Trust.

  
	

  Section

  1004.  Corporate Existence.

  
	

  Section

  1005. 

  Payment of Taxes and Other Claims.

  
	

  Section

  1006. 

  Maintenance of Properties.

  
	

  Section

  1007.  Insurance.

  
	

  Section

  1008. 

  Limitation on Indebtedness.

  
	

  Section

  1009. 

  Limitation on Restricted Payments.

  
	

  Section

  1010. 

  Limitation on Transactions with Affiliates.

  
	

  Section

  1011. 

  Limitation on Senior Subordinated Indebtedness.

  
	

  Section

  1012.  Limitation on Liens.

  
	

  Section

  1013. 

  Limitation on Sale of Assets.

  
	

  Section

  1014.  Limitation on Issuances of

  Guarantees of and Pledges for Indebtedness.

  
	

  Section

  1015. 

  Restriction on Transfer of Assets.

  
	

  Section

  1016. 

  Purchase of Securities upon a Change of

  Control.

  
	

  Section

  1017. 

  Limitation on Subsidiary Equity Interests.

  
	

  Section

  1018.  Limitation on Dividends and

  Other Payment Restrictions Affecting Subsidiaries.

  
	

  Section

  1019.  Limitation on Unrestricted Subsidiaries.

  
	

  Section

  1020. 

  Provision of Financial Statements.

  
	

  Section

  1021. 

  Statement by Officers as to Default.

  
	

  Section

  1022. 

  Waiver of Certain Covenants.

  
	

   

  
	

  ARTICLE

  ELEVEN  REDEMPTION OF SECURITIES

  
	

   

  
	

  Section

  1101.  Rights of Redemption.

  
	

  Section

  1102. 

  Applicability of Article.

  
	

  Section

  1103. 

  Election to Redeem; Notice to Trustee.

  
	

  Section

  1104. 

  Selection by Trustee of Securities to

  Be Redeemed.

  
	

  Section

  1105.  Notice of Redemption.

  
	

  Section

  1106. 

  Deposit of Redemption Price.

  
	

  Section

  1107.  Securities Payable on Redemption Date.

  
	

  Section

  1108. 

  Securities Redeemed or Purchased in Part.

  
	

   

  
	

  ARTICLE

  TWELVE  SUBORDINATION OF SECURITIES

  
	

   

  
	

  Section

  1201. 

  Securities Subordinate to Senior Indebtedness.

  
	

  Section

  1202. 

  Payment Over of Proceeds Upon Dissolution, etc.

  
	

  Section

  1203. 

  Suspension of Payment When Senior

  Indebtedness in Default.

  

 

vii

 

	

  Section

  1204. 

  Payment Permitted if No Default.

  
	

  Section

  1205. 

  Subrogation to Rights of Holders of

  Senior Indebtedness.

  
	

  Section

  1206. 

  Provisions Solely to Define Relative Rights.

  
	

  Section

  1207. 

  Trustee to Effectuate Subordination.

  
	

  Section

  1208. 

  No Waiver of Subordination Provisions.

  
	

  Section

  1209.  Notice to Trustee.

  
	

  Section

  1210.  Reliance on Judicial Order or

  Certificate of Liquidating Agent.

  
	

  Section

  1211.  Rights of Trustee as a Holder

  of Senior Indebtedness; Preservation of Trustee’s Rights.

  
	

  Section

  1212. 

  Article Applicable to Paying Agents.

  
	

  Section

  1213. 

  No Suspension of Remedies.

  
	

  Section

  1214. 

  Trustee’s Relation to Senior Indebtedness.

  
	

   

  
	

  ARTICLE

  THIRTEEN  SATISFACTION AND DISCHARGE

  
	

   

  
	

  Section

  1301. 

  Satisfaction and Discharge of Indenture.

  
	

  Section 1302.  Application of Trust Money.

  
	

   

  
	

  ARTICLE

  FOURTEEN  GUARANTEE

  
	

   

  
	

  Section

  1401.  Guarantors’ Guarantee.

  
	

  Section

  1402.  Continuing Guarantee; No Right

  of Set-Off; Independent Obligation.

  
	

  Section

  1403.  Guarantee Absolute.

  
	

  Section

  1404. 

  Right to Demand Full Performance.

  
	

  Section

  1405.  Waivers.

  
	

  Section

  1406.  The Guarantors Remain Obligated

  in Event the Company Is No Longer Obligated to Discharge Indenture

  Obligations.

  
	

  Section

  1407. 

  Fraudulent Conveyance; Contribution; Subrogation.

  
	

  Section

  1408.  Guarantee Is in Addition to Other

  Security.

  
	

  Section

  1409. 

  Release of Security Interests.

  
	

  Section

  1410. 

  No Bar to Further Actions.

  
	

  Section

  1411.  Failure to Exercise Rights

  Shall Not Operate as a Waiver; No Suspension of Remedies.

  
	

  Section

  1412.  Trustee’s Duties; Notice to Trustee.

  
	

  Section

  1413. 

  Successors and Assigns.

  
	

  Section

  1414.  Release of Guarantee.

  
	

  Section

  1415. 

  Execution of Guarantee.

  
	

  Section

  1416.  Guarantee  Subordinate to Guarantor

  Senior Indebtedness.

  
	

  Section

  1417.  Payment Over of Proceeds Upon

  Dissolution of the Guarantor, etc.

  
	

  Section

  1418. 

  Default on Guarantor Senior Indebtedness.

  
	

  Section

  1419. 

  Payment Permitted by Each of the

  Guarantors if No Default.

  

 

viii

 

	

  Section

  1420.  Subrogation to Rights of

  Holders of Guarantor Senior Indebtedness.

  
	

  Section

  1421. 

  Provisions Solely to Define Relative Rights.

  
	

  Section

  1422. 

  Trustee to Effectuate Subordination.

  
	

  Section

  1423. 

  No Waiver of Subordination Provisions.

  
	

  Section

  1424. 

  Notice to Trustee by Each of the

  Guarantors.

  
	

  Section

  1425. 

  Reliance on Judicial Order or

  Certificate of Liquidating Agent.

  
	

  Section

  1426.  Rights of Trustee as a Holder

  of Guarantor Senior Indebtedness; Preservation of Trustee’s Rights.

  
	

  Section

  1427.  Article Applicable to Paying Agents.

  
	

  Section

  1428. 

  No Suspension of Remedies.

  
	

  Section

  1429. 

  Trustee’s Relation to Guarantor Senior Indebtedness.

  

 

	

  TESTIMONIUM

  	

   

  
	

   

  	

   

  
	

  SIGNATURES AND SEALS

  	

   

  
	

   

  	

   

  
	

  ACKNOWLEDGMENTS

  	

   

  
	

   

  
	

  ANNEX A

  	

  Guarantors

  
	

   

  	

   

  
	

  SCHEDULE I

  	

  Existing Indebtedness of Sinclair

  
	

   

  	

  Broadcast Group, Inc. and its Restricted

  
	

   

  	

  Subsidiaries

  
	

   

  	

   

  
	

  SCHEDULE II

  	

  Existing Liens

  
	

   

  	

   

  
	

  SCHEDULE III

  	

  Existing Encumbrances and Restrictions

  
	

   

  	

   

  
	

  EXHIBIT A

  	

  Form of Regulation S Certificate

  
	

   

  	

   

  
	

  EXHIBIT B

  	

  Form of Restricted Securities Transfer

  Certificate

  
	

   

  	

   

  
	

  EXHIBIT C

  	

  Form of Unrestricted Securities Certificate

  
	

   

  	

   

  
	

  EXHIBIT D

  	

  Form of Intercompany Note

  
			

 

ix

 

Reconciliation and

tie between Trust Indenture Act of 1939

and Indenture,

dated as of December 10, 2001

 

	

  Trust Indenture 

  Act Section

  	

   

  	

  Indenture 

  Section

  
	

  § 310(a) 

  	

   

  	

  610, 611 

  
	

  (a)(1)

  	

   

  	

  608 

  
	

  (a)(2) 

  	

   

  	

  608 

  
	

  (b)

  	

   

  	

  607, 609

  
	

  § 311(a)

  	

   

  	

  612

  
	

  § 312(a)

  	

   

  	

  701

  
	

  (b)

  	

   

  	

  702

  
	

  (c)

  	

   

  	

  702

  
	

  § 313(a) 

  	

   

  	

  703 

  
	

  (c)

  	

   

  	

  703, 704

  
	

  § 314(a) 

  	

   

  	

  704 

  
	

  (a)(4) 

  	

   

  	

  1021 

  
	

  (c)(1) 

  	

   

  	

  103 

  
	

  (c)(2) 

  	

   

  	

  103 

  
	

  (e)

  	

   

  	

  103

  
	

  § 315(a) 

  	

   

  	

  602, 903 

  
	

  (b) 

  	

   

  	

  601, 602, 903 

  
	

  (c) 

  	

   

  	

  602, 903 

  
	

  (d)

  	

   

  	

  602, 903

  
	

  (e)

  	

   

  	

  514

  
	

  § 316(a)(last

  sentence) 

  	

   

  	

  101

  (“Outstanding”) 

  
	

  (a)(1)(A) 

  	

   

  	

  502, 512 

  
	

  (a)(1)(B) 

  	

   

  	

  513 

  
	

  (b) 

  	

   

  	

  508 

  
	

  (c)

  	

   

  	

  105

  
	

  § 317(a)(1)

  	

   

  	

  503

  
	

  (a)(2)

  	

   

  	

  504

  
	

  (b)

  	

   

  	

  1003

  
	

  § 318(a)

  	

   

  	

  108

  

 

Note:      This reconciliation and

tie shall not, for any purpose, be deemed to be a part of this Indenture.

 

xINCENTIVE STOCK OPTION AGREEMENT

EXHIBIT 10.1(b)

 

INCENTIVE STOCK OPTION

AGREEMENT

 

UNDER THE STOCKER &

YALE, INC.

1996 STOCK OPTION AND

INCENTIVE PLAN

 

 

Name of

Optionee:_____________________________

No. of Option

Shares:___________________________

Option Exercise

Price per Share:_____________________________________

[FMV (110%

of FMV if a 10% owner)]

Grant

Date:____________________

Expiration

Date:_____________________________________

[up to 10

years (5 if a 10% owner)]

 

 

Pursuant to

the Stocker & Yale, Inc. 1996 Stock Option and Incentive Plan (the “Plan”)

as amended through the date hereof, Stocker & Yale, Inc.  (the “Company”) hereby grants to the

Optionee named above an option (the “Stock Option”) to purchase on or prior to

the Expiration Date specified above all or part of the number of shares of

Common Stock, par value $.001 per share (the “Stock”) of the Company specified

above at the Option Exercise Price per Share specified above subject to the

terms and conditions set forth herein and in the Plan.

 

1.             Vesting Schedule.  No portion of this Stock Option may be

exercised until such portion shall have vested.  Except as set forth below, and subject to the discretion of the

Committee (as defined in Section 2 of the Plan) to accelerate the vesting

schedule hereunder, this Stock Option shall be vested and exercisable with

respect to the following number of Option Shares on the dates indicated:

 

	

  Number of

  	

   

  	

   

  	

   

  
	

  Option

  Shares Exercisable*

  	

   

  	

  Vesting

  Date

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  (___%

  	

  )

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  (___%

  	

  )

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  (___%

  	

  )

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  (___%

  	

  )

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  (___%

  	

  )

  	

   

  	

   

  

 

* Max. of $100,000 per yr.

 

 

 

In the event of a Change of Control of the Company as defined

in Section 14 of the Plan, this Stock Option shall become immediately vested

and exercisable in full, whether or not this Stock Option or any portion hereof

is vested and exercisable at such time. 

Once vested, this Stock Option shall continue to be exercisable at any

time or times prior to the close of business on the Expiration Date, subject to

the provisions hereof and of the Plan.

 

2.             Manner

of Exercise.

 

(a)           The

Optionee may exercise this Option only in the following manner:  from time to time on or prior to the

Expiration Date of this Option, the Optionee may give written notice to the

Committee of his or her election to purchase some or all of the vested Option

Shares purchasable at the time of such notice. 

This notice shall specify the number of Option Shares to be purchased.

 

Payment of the purchase price for the Option Shares may be

made by one or more of the following methods:  (i) in cash, by certified or bank check or other instrument

acceptable to the Committee; (ii) in the form of shares of Stock that are

not then subject to restrictions under any Company plan and that have been held

by the Optionee for at least six months; (iii) by the Optionee delivering

to the Company a properly executed exercise notice together with irrevocable

instructions to a broker to promptly deliver to the Company cash or a check

payable and acceptable to the Company to pay the option purchase price,

provided that in the event the Optionee chooses to pay the option purchase

price as so provided, the Optionee and the broker shall comply with such

procedures and enter into such agreements of indemnity and other agreements as

the Committee shall prescribe as a condition of such payment procedure; or

(iv) a combination of (i), (ii) and (iii) above.  Payment instruments will be received subject to collection.

 

The delivery of certificates representing the Option Shares

will be contingent upon the Company’s receipt from the Optionee of full payment

for the Option Shares, as set forth above and any agreement, statement or other

evidence that the Company may require to satisfy itself that the issuance of

Stock to be purchased pursuant to the exercise of Options under the Plan and

any subsequent resale of the shares of Stock will be in compliance with

applicable laws and regulations.

 

(b)           Certificates

for the shares of Stock purchased upon exercise of this Stock Option shall be

issued and delivered to the Optionee upon compliance to the satisfaction of the

Committee with all requirements under applicable laws or regulations in

connection with such issuance and with the requirements hereof and of the

Plan.  The determination of the

Committee as to such compliance shall be final and binding on the

Optionee.  The Optionee shall not be

deemed to be the holder of, or to have any of the rights of a holder with

respect to, any shares of Stock subject to this Stock Option unless and until

this Stock Option shall have been exercised pursuant to the terms hereof, the

Company shall have issued and delivered the shares to the Optionee, and the

Optionee’s name shall have been entered as the stockholder of record on the

books of the Company.

 

2

 

Thereupon,

the Optionee shall have full voting, dividend and other ownership rights with

respect to such shares of Stock.

 

(c)           The

minimum number of shares with respect to which this Stock Option may be

exercised at any one time shall be 100 shares, unless the number of shares with

respect to which this Stock Option is being exercised is the total number of

shares subject to exercise under this Stock Option at the time.

 

(d)           Notwithstanding

any other provision hereof or of the Plan, no portion of this Stock Option

shall be exercisable after the Expiration Date hereof.

 

3.             Termination

of Employment.  If the Optionee’s

employment by the Company or a Subsidiary (as defined in the Plan) is

terminated, the period within which to exercise the Option may be subject to

earlier termination as set forth below.

 

(a)           Termination

Due to Death.  If the Optionee’s

employment terminates by reason of death, any Option held by the Optionee shall

become fully exercisable and may thereafter be exercised by the Optionee’s

legal representative or legatee for a period of 12 months from the date of

death or until the Expiration Date, if earlier.

 

(b)           Termination

Due to Disability.  If the

Optionee’s employment terminates by reason of Disability (as defined in the Plan),

any Option held by the Optionee shall become fully exercisable and may

thereafter be exercised by the Optionee for a period of [12 ]months from the

date of termination or until the Expiration Date, if earlier.  The death of the Optionee during the [12]-month

period provided in this Section 3(b) shall extend such period for another

[12] months from the date of death or until the Expiration Date, if earlier.

 

(c)           Termination

for Cause.  If the Optionee’s

employment terminates for Cause (as defined in the Plan), any Option held by

the Optionee shall terminate immediately and be of no further force and effect.

 

(d)           Other

Termination.  If the Optionee’s

employment terminates for any reason other than death, Disability, or Cause,

and unless otherwise determined by the Committee, any Option held by the

Optionee may be exercised, to the extent exercisable on the date of

termination, for a period of three months from the date of termination or until

the Expiration Date, if earlier.  Any

Option that is not exercisable at such time shall terminate immediately and be

of no further force or effect.

 

 The Committee’s determination of the reason

for termination of the Optionee’s employment shall be conclusive and binding on

the Optionee and his or her representatives or legatees.

 

4.             Incorporation

of Plan.  Notwithstanding anything

herein to the contrary, this Stock Option shall be subject to and governed by

all the terms and conditions of the Plan.

 

3

 

Capitalized terms in this Agreement shall have the meaning

specified in the Plan, unless a different meaning is specified herein.

 

5.             Transferability.  This Agreement is personal to the Optionee,

is non-assignable and is not transferable in any manner, by operation of law or

otherwise, other than by will or the laws of descent and distribution.  This Stock Option is exercisable, during the

Optionee’s lifetime, only by the Optionee, and thereafter, only by the

Optionee’s legal representative or legatee.

 

6.             Status

of the Stock Option.  This Stock

Option is intended to qualify as an “incentive stock option” under Section 422

of the Internal Revenue Code of 1986, as amended (the “Code”), but the Company

does not represent or warrant that this Option qualifies as such.  The Optionee should consult with his or her

own tax advisors regarding the tax effects of this Option and the requirements

necessary to obtain favorable income tax treatment under Section 422 of

the Code, including, but not limited to, holding period requirements.  If the Optionee intends to dispose or does

dispose (whether by sale, gift, transfer or otherwise) of any Option Shares

within the one-year period beginning on the date after the transfer of such

shares to him or her, or within the two-year period beginning on the day after

the grant of this Stock Option, he or she will notify the Company within 30

days after such disposition.

 

7.             Miscellaneous.

 

(a)           Notice

hereunder shall be given to the Company at its principal place of business, and

shall be given to the Optionee at the address set forth below, or in either

case at such other address as one party may subsequently furnish to the other

party in writing.

 

(b)           This Stock

Option does not confer upon the Optionee any rights with respect to continuance

of employment by the Company or any Subsidiary.

 

(c)           Pursuant

to Section 12 of the Plan, the Committee may at any time amend or cancel any

outstanding portion of this Stock Option, but no such action may be taken which

adversely affects the Optionee’s rights under this Agreement without the

Optionee’s consent.

 

 

	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  By:

  	

   

  
	

   

  	

   

  	

   

  	

  Title:

  

 

 

4

 

The

foregoing Agreement is hereby accepted and the terms and conditions thereof

hereby agreed to by the undersigned.

 

 

	

  Dated:

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  Optionee’s

  Signature

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  Optionee’s name

  and address:

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  

 

 

5

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