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Exhibit 2.7
JACOR COMMUNICATIONS, INC.
AND
KEYCORP SHAREHOLDER SERVICES, INC.
AS WARRANT AGENT
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WARRANT AGREEMENT
DATED AS OF , 1996
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WARRANT AGREEMENT, dated as of ___________, 1996 between Jacor
Communications, Inc., an Ohio corporation (the "Company"), and KeyCorp
Shareholder Services Inc., of ___________, a national banking association, as
Warrant Agent (the "Warrant Agent") ("Agreement").
The Company proposes to issue Common Stock Purchase Warrants, as
hereinafter described (the "Warrants"), to purchase up to an aggregate of
[_______] shares of its Common Stock without par value ("Common Stock") (the
shares of Common Stock issuable on exercise of the Warrants being referred to
herein as the "Warrant Shares"), pursuant to an Agreement and Plan of Merger
among the Company, JCAC, Inc. and Citicasters, Inc. dated as of February, 1996,
pursuant to which the Company will issue the Warrants, each Warrant entitling
the holder thereof to purchase _____ of a share of Common Stock.
The Company wishes the Warrant Agent to act on behalf of the Company
and the Warrant Agent is willing to act in connection with the issuance,
division, transfer, exchange and exercise of Warrants.
In consideration of the foregoing and for the purpose of defining the
terms and provisions of the Warrants and the respective rights and obligations
thereunder of the Company and the registered owners of the Warrants (the
"Holders"), the Company and the Warrant Agent hereby agree as follows:
SECTION 1. APPOINTMENT OF WARRANT AGENT. The Company hereby appoints
the Warrant Agent to act as agent for the Company in accordance with the
instructions hereinafter set forth in this Agreement, and the Warrant Agent
hereby accepts such appointment.
SECTION 2. TRANSFERABILITY AND FORM OF WARRANT.
2.1 REGISTRATION. The Warrants shall be numbered and shall be
registered in a Warrant Register as they are issued. The Company and the Warrant
Agent shall be entitled to treat the Holder of any Warrant as the owner in fact
thereof for all purposes and shall not be bound to recognize any equitable or
other claim to or interest in such Warrant on the part of any other person, and
shall not be liable for any registration of transfer of Warrants which are
registered or to be registered in the name of a fiduciary or the nominee of a
fiduciary unless made with the actual knowledge that a fiduciary or nominee is
committing a breach of trust in requesting such registration of transfer, or
with such knowledge of such acts that its participation therein amounts to bad
faith.
2.2 TRANSFER. The Warrants shall be transferable only on the
books of the Company maintained at the principal office of the Warrant Agent
upon delivery thereof duly endorsed by the Holder or by his duly authorized
attorney or representative, or accompanied by proper evidence of succession,
assignment or authority to transfer, which endorsement shall be guaranteed by a
bank or trust company or a broker or dealer which is a member of the National
Association of Securities Dealers, Inc. In all cases of transfer by an attorney,
the original power of attorney, duly approved, or a copy thereof, duly
certified, shall be deposited and remain with the Warrant Agent. In case of
transfer by executors, administrators, guardians or other legal representatives,
duly authenticated evidence of their authority shall be produced, and may be
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required to be deposited and remain with the Warrant Agent in its discretion.
Upon any registration of transfer, the Warrant Agent shall countersign and
deliver a new Warrant or Warrants to the persons entitled thereto.
2.3 FORM OF WARRANT. The text of the Warrant and of the
Purchase Form shall be substantially as set forth in Exhibit A attached hereto.
The price per Warrant Share and the number of Warrant Shares issuable upon
exercise of each Warrant are subject to adjustment upon the occurrence of
certain events, all as hereinafter provided. The Warrants shall be executed on
behalf of the Company by its President or one of its Vice Presidents, under its
corporate seal reproduced thereon attested by its Secretary or an Assistant
Secretary. The signature of any such officers on the Warrants may be manual or
facsimile.
Warrants 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 one of them shall have
ceased to hold such offices prior to the delivery of such Warrants or did not
hold such offices on the date of this Agreement.
Warrants shall be dated as of the date of countersignature
thereof by the Warrant Agent either upon initial issuance or upon division,
exchange, substitution or transfer.
SECTION 3. COUNTERSIGNATURE OF WARRANTS. The Warrants shall be
countersigned by the Warrant Agent (or any successor to the Warrant Agent then
acting as warrant agent under this Agreement) and shall not be valid for any
purpose unless so countersigned. Warrants may be countersigned, however, by the
Warrant Agent (or by its successor as warrant agent hereunder) and may be
delivered by the Warrant Agent, notwithstanding that the persons whose manual or
facsimile signatures appear thereon as proper officers of the Company shall have
ceased to be such officers at the time of such countersignature, issuance or
delivery. The Warrant Agent shall, upon written instructions of the Chairman of
the Board, the President, a Vice President, the Treasurer or the Secretary of
the Company, countersign, issue and deliver Warrants entitling the Holders
thereof to purchase not more than [_______] Warrant Shares (subject to
adjustment pursuant to Section 10 hereof) and shall countersign and deliver
Warrants as otherwise provided in this Agreement.
SECTION 4. EXCHANGE OF WARRANT CERTIFICATES. Each Warrant certificate
may be exchanged for another certificate or certificates entitling the Holder
thereof to purchase a like aggregate number of Warrant Shares as the certificate
or certificates surrendered then entitle such Holder to purchase. Any Holder
desiring to exchange a Warrant certificate or certificates shall make such
request in writing delivered to the Warrant Agent, and shall surrender, properly
endorsed, the certificate or certificates to be so exchanged. Thereupon, the
Warrant Agent shall countersign and deliver to the person entitled thereto a new
Warrant certificate or certificates, as the case may be, as so requested.
SECTION 5. TERM OF WARRANTS; EXERCISE OF WARRANTS.
5.1 TERM OF WARRANTS. Subject to the terms of this Agreement,
each Holder shall have the right, which may be exercised commencing the date of
issuance of the Warrants
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and until 5:00 P.M., Eastern Time, on ___________, [2001] [the fifth anniversary
of the date of the Effective Time as defined in the Agreement and Plan of Merger
among the Company, JCAC, Inc., and Citicasters, Inc.] (the "Expiration Date"),
to purchase from the Company the number of fully paid and nonassessable Warrant
Shares which the Holder may at the time be entitled to purchase on exercise of
such Warrants.
5.2 EXERCISE OF WARRANTS. A Warrant may be exercised upon
surrender to the Warrant Agent, at its principal office, of the certificate or
certificates evidencing the Warrants to be exercised, together with the form of
election to purchase on the reverse thereof duly filled in and signed, which
signature shall be guaranteed by a bank or trust company or a broker or dealer
which is a member of the National Association of Securities Dealers, Inc., and
upon payment to the Warrant Agent for the account of the Company of the Warrant
Price (as defined in and determined in accordance with the provisions of
Sections 9 and 10 hereof), for the number of Warrant Shares in respect of which
such Warrants are then exercised. Payment of the aggregate Warrant Price shall
be made in cash or by certified or bank cashier's check drawn on a banking
institution chartered by the government of the United States or any state
thereof.
Subject to Section 6 hereof, upon such surrender of Warrants
and payment of the Warrant Price as aforesaid, the Warrant Agent shall cause to
be issued and delivered with all reasonable dispatch to or upon the written
order of the Holder and in such name or names as the Holder may designate, a
certificate or certificates for the number of full Warrant Shares so purchased
upon the exercise of such Warrants, together with cash, as provided in Section
11 hereof, in respect of any fractional Warrant Shares otherwise issuable upon
such surrender. Such certificate or certificates shall be deemed to have been
issued and any person so designated to be named therein shall be deemed to have
become a holder of record of such Warrant Shares as of the date of the surrender
of such Warrants and payment of the Warrant Price, as aforesaid. The rights of
purchase represented by the Warrants shall be exercisable, at the election of
the Holders thereof, either in full or from time to time in part and, in the
event that a certificate evidencing Warrants is exercised in respect of less
than all of the Warrant Shares purchasable on such exercise at any time prior to
the date of expiration of the Warrants, a new certificate evidencing the
remaining Warrant or Warrants will be issued, and the Warrant Agent is hereby
irrevocably authorized to countersign and to deliver the required new Warrant
certificate or certificates pursuant to the provisions of this Section and of
Section 3 hereof, and the Company, whenever required by the Warrant Agent, will
supply the Warrant Agent with Warrant certificates duly executed on behalf of
the Company for such purpose.
5.3 RESTRICTION ON EXERCISE. A Warrant may not be exercised in
whole or in part if in the reasonable opinion of counsel to the Company the
issuance of the Common Stock upon such exercise would cause the Company to be in
violation of the Telecommunications Act of 1996 or the rules and regulations in
effect thereunder. A Holder desiring to exercise Warrants shall, if requested by
the Company, furnish to the Company such additional information as the Company
deems reasonably necessary in order to determine if exercise of a Warrant may
cause the Company to be in said violation. In the event the Company's counsel
determines that, in such counsel's opinion after review of such information, if
any, requested by and delivered to, the Company, the exercise of a Warrant would
cause the Company to be in violation of the Telecommunications Act of 1996 or
the rules and regulations in effect thereunder, the Company
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shall notify such Holder to that effect. Upon receipt of said notice, such
Holder may take such steps, at its own expense, as it reasonably determines
necessary so that the exercise of the Warrant would not cause such a violation;
provided, that upon completion of said steps, such Holder shall notify the
Company and the provisions of this Section 5.3 shall then apply with respect to
the proposed revised transaction.
5.4 LEGEND ON CERTIFICATE. The certificates evidencing the
Warrants may, in the sole discretion of the Company, bear a legend relating to
certain limitations on the ownership of Common Stock imposed by the
Telecommunications Act of 1996.
SECTION 6. PAYMENT OF TAXES. The Company will pay all documentary stamp
taxes, if any, attributable to the initial issuance of Warrant Shares upon the
exercise of Warrants; provided, however, that the Company shall not be required
to pay any tax or taxes which may be payable in respect of any transfer involved
in the issue or delivery of any Warrants or certificates for Warrant Shares in a
name other than that of the registered Holder of Warrants in respect of which
such Warrant Shares are issued.
SECTION 7. MUTILATED OR MISSING WARRANTS. In case any of the
certificates evidencing the Warrants shall be mutilated, lost stolen or
destroyed, the Company shall issue, and the Warrant Agent shall countersign and
deliver in exchange and substitution for and upon cancellation of the mutilated
Warrant certificate, or in lieu of and substitution for the Warrant certificate
lost, stolen or destroyed, a new Warrant certificate of like tenor and
representing an equivalent right or interest, but only upon receipt of evidence
satisfactory to the Company and the Warrant Agent of such loss, theft or
destruction of such Warrant and indemnity or bond, if requested, also
satisfactory to them. An applicant for such a substitute Warrant certificate
shall also comply with such other reasonable regulations and pay such other
reasonable charges as the Company or the Warrant Agent may prescribe.
SECTION 8. RESERVATION OF WARRANT SHARES; PURCHASE, CALL AND
CANCELLATION OF WARRANTS.
8.1 RESERVATION OF WARRANT SHARES. There have been reserved,
and the Company shall at all times keep reserved, out of its authorized Common
Stock, a number of shares of Common Stock sufficient to provide for the exercise
of the rights of purchase represented by the outstanding Warrants. The Transfer
Agent for the Common Stock and every subsequent transfer agent for any shares of
the Company's capital stock issuable upon the exercise of any of the rights of
purchase aforesaid will be irrevocably authorized and directed at all times to
reserve such number of authorized shares as shall be required for such purpose.
The Company will keep a copy of this Agreement on file with the Transfer Agent
for the Common Stock and with every subsequent transfer agent for any shares of
the Company's capital stock issuable upon the exercise of the rights of purchase
represented by the Warrants. The Warrant Agent is hereby irrevocably authorized
to requisition from time to time from such Transfer Agent the stock certificates
required to honor outstanding Warrants upon exercise thereof in accordance with
the terms of this Agreement. The Company will supply such Transfer Agent with
duly executed stock certificates for such purposes and will provide or otherwise
make available any cash which may be payable as provided in Section 11 hereof.
All Warrants surrendered in the
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exercise of the rights thereby evidenced shall be canceled by the Warrant Agent
and shall thereafter be delivered to the Company.
8.2 PURCHASE OF WARRANTS BY THE COMPANY. The Company shall
have the right, except as limited by law, other agreements or herein, to
purchase or otherwise acquire Warrants at such times, in such manner and for
such consideration as it may deem appropriate.
8.3 CANCELLATION OF WARRANTS. In the event the Company shall
purchase or otherwise acquire Warrants, the same shall thereupon be delivered to
the Warrant Agent and be canceled by it and retired. The Warrant Agent shall
cancel any Warrant surrendered for exchange, substitution, transfer or exercise
in whole or in part.
SECTION 9. WARRANT PRICE. The price per share at which Warrant Shares
shall be purchasable upon exercise of Warrants shall be $______ (the "Warrant
Price"), subject to adjustment pursuant to Section 10 hereof.
SECTION 10. ADJUSTMENT OF WARRANT PRICE AND NUMBER OF WARRANT SHARES.
The number and kind of securities purchasable upon the exercise of each Warrant
and the Warrant Price shall be subject to adjustment from time to time upon the
happening of certain events, as hereinafter defined.
10.1 MECHANICAL ADJUSTMENTS. The number of Warrant Shares
purchasable upon the exercise of each Warrant and the Warrant Price shall be
subject to adjustment as follows:
(a) In case the Company shall (i) pay a dividend in
shares of Common Stock or make a distribution in shares of
Common Stock, (ii) subdivide its outstanding shares of Common
Stock, (iii) combine its outstanding shares of Common Stock
into a smaller number of shares of Common Stock, or (iv) issue
by reclassification of its shares of Common Stock other
securities of the Company (including any such reclassification
in connection with a consolidation or merger in which the
Company is surviving corporation), the number of Warrant
Shares purchasable upon exercise of each Warrant immediately
prior thereto shall be adjusted so that the Holder of each
Warrant shall be entitled to receive the kind and number of
Warrant Shares or other securities of the Company which he
would have owned or have been entitled to receive after the
happening of any of the events described above, had such
Warrant been exercised immediately prior to the happening of
such event or any record date with respect thereto. An
adjustment made pursuant to this paragraph (a) shall become
effective immediately after the effective date of such event
retroactive to the record date, if any, or such event.
(b) In case the Company shall issue rights, options
or warrants to all holders of its outstanding Common Stock,
without any charge to such holders, entitling them (for a
period within 45 days after the record date mentioned below)
to subscribe for or purchase shares of Common Stock at a price
per share which is
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lower at the record date mentioned below than the then current
market price per share of Common Stock (as defined in
paragraph (d) below) the number of Warrant Shares thereafter
purchasable upon the exercise of each Warrant shall be
determined by multiplying the number of Warrant Shares
theretofore purchasable upon exercise of each Warrant by a
fraction, of which the numerator shall be the number of shares
of Common Stock outstanding on the date of issuance of such
rights, options or warrants plus the number of additional
shares of Common Stock offered for subscription or purchase,
and of which the denominator shall be the number of shares of
Common Stock outstanding on the date of issuance of such
rights, options or warrants plus the number of shares which
the aggregate offering price of the total number of shares of
Common Stock so offered would purchase at the then current
market price per share of Common Stock. Such adjustment shall
be made whenever such rights, options or warrants are issued,
and shall become effective retroactively immediately after the
record date for the determination of stockholders entitled to
receive such rights, options or warrants.
(c) In case the Company shall distribute to all
holders of its shares of Common Stock evidences of its
indebtedness or assets (excluding cash dividends or
distributions payable out of consolidated earnings or surplus
legally available for dividends and dividends or distributions
referred to in paragraph (a) above) or rights, options or
warrants, or convertible or exchangeable securities containing
the right to subscribe for or purchase shares of Common Stock
(excluding those referred to in paragraph (b) above), then in
each case the number of Warrant Shares thereafter purchasable
upon the exercise of each Warrant shall be determined by
multiplying the number of Warrant Shares theretofore
purchasable upon the exercise of each Warrant, by a fraction,
of which the numerator shall be the then current market price
per share of Common Stock (as defined in paragraph (d) below)
on the date of such distribution, and of which the denominator
shall be the then current market price per share of Common
Stock, less the then fair value (as determined by the Board of
Directors of the Company, whose determination shall be
conclusive) of the portion of the assets or evidences of
indebtedness so distributed or of such subscription rights,
options or warrants, or of such convertible or exchangeable
securities applicable to one share of Common Stock. Such
adjustment shall be made whenever any such distribution is
made, and shall become effective on the date of distribution
retroactive to the record date for the determination of
shareholders entitled to receive such distribution.
In the Company's sole discretion, in the event of a
distribution by the Company to all holders of its shares of
Common Stock of the capital stock of a subsidiary or
securities convertible into or exercisable for such stock,
then in lieu of an adjustment in the number of Warrant Shares
purchasable upon the exercise of each Warrant, the Holder of
each Warrant, upon the exercise thereof at any time after such
distribution shall be entitled to receive the stock or other
securities to which such Holder would have been entitled if
such Holder had exercised such Warrant immediately prior
thereto, all subject to further adjustment as provided in this
subsection 10.1; provided, however, that no adjustment in
respect of dividends
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or interest on such stock or other securities shall be made
during the term of a Warrant or upon the exercise of a
Warrant.
(d) For the purpose of any computation under paragraphs (b)
and (c) of this Section, the current market price per share of Common
Stock at any date shall be the average of the daily closing prices for
20 consecutive trading days commencing 30 trading days before the date
of such computation. The closing price for each day shall be the last
reported sales price regular way or, in case no reported sale takes
place on such day, the average of the closing bid and asked prices
regular way for such day, in each case on the principal national
securities exchange on which the shares of Common Stock are listed or
admitted to trading or, if not listed or admitted to trading, the
average of the closing bid and asked prices of the Common Stock in the
over-the-counter market as reported by NASDAQ or any comparable system.
In the absence of one or more such quotations, the Company shall
determine the current market price on the basis of such quotations as
it considers appropriate.
(e) No adjustment in the number of Warrant Shares purchasable
hereunder shall be required unless and until such adjustment would
require an increase or decrease of at least one percent (1%) in the
number of Warrant Shares purchasable upon the exercise of each Warrant;
provided, however, that any adjustments which by reason of this
paragraph (e) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All calculations shall
be made to the nearest one-thousandth of a share.
(f) Whenever the number of shares purchasable upon the
exercise of each Warrant is adjusted as provided in paragraphs (a), (b)
and (c) above, the Warrant Price payable upon exercise of each Warrant
shall be adjusted by multiplying such Warrant Price immediately prior
to such adjustment by a fraction, of which the numerator shall be the
number of Warrant Shares purchasable upon the exercise of each Warrant
immediately prior to such adjustment, and of which the denominator
shall be the number of Warrant Shares purchasable immediately
thereafter.
(g) No adjustment in the number of Warrant Shares purchasable
upon the exercise of each Warrant need be made under paragraphs (b) and
(c) if the Company issues or distributes to each Holder of Warrants the
rights, options, warrants, or convertible or exchangeable securities,
or evidence of indebtedness or assets referred to in those paragraphs
which each Holder of Warrants would have been entitled to receive had
the Warrants been exercised prior to the happening of such event or the
record date with respect thereto. No adjustment in the number of
Warrant Shares purchasable upon the exercise of each Warrant need be
made for sales of Warrant Shares pursuant to a Company plan for
reinvestment of dividends or interest. No adjustment need be made for a
change in the par value of the Warrant Shares.
(h) For the purpose of this subsection 10.1, the term "shares
of Common Stock" shall mean (i) the class of stock designated as the
Common Stock of the Company at the date of this Agreement, or (ii) any
other class of stock resulting from successive
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changes or reclassification of such shares consisting solely of changes
in par value, or from par value to no par value, or from no par value
to par value. In the event that at any time, as a result of an
adjustment made pursuant to paragraph (a) above, the Holders shall
become entitled to purchase any shares of the Company other than shares
of Common Stock, thereafter the number of such other shares so
purchasable upon exercise of each Warrant and the Warrant Price of such
shares shall be subject to adjustment from time to time in a manner and
on terms as nearly equivalent as practicable to the provisions with
respect to the Warrant Shares contained in paragraph (a) through (c),
inclusive, above, and the provisions of Section 5 and subsections 10.2
through 10.4, inclusive, with respect to the Warrant Shares, shall
apply on like terms to any such other shares.
(i) Upon the expiration of any rights, options, warrants or
conversion or exchange privileges, if any thereof shall not have been
exercised, the Warrant Price and the number of shares of Common Stock
purchasable upon the exercise of each Warrant shall, upon such
expiration, be readjusted and shall thereafter be such as it would have
been had it been originally adjusted (or had the original adjustment
not been required, as the case may be) as if (A) the only shares of
Common Stock so issued were the shares of Common Stock, if any,
actually issued or sold upon the exercise of such rights, options,
warrants or conversion or exchange rights and (B) such shares of Common
Stock, if any, were issued or sold for the consideration, if any,
actually received by the Company for the issuance, sale or grant of all
such rights, options, warrants or conversion or exchange rights whether
or not exercised; provided, further, that no such readjustment shall
have the effect of increasing the Warrant Price by an amount in excess
of the amount of the adjustment initially made in respect to the
issuance, sale or grant of such rights, options, warrants or conversion
or exchange rights.
10.2 DETERMINATION OF CONSIDERATION. Upon any issuance or sale
for a consideration other than cash, or a consideration part of which is other
than cash, of any shares of Common Stock or Convertible Securities or any rights
or options to subscribe for, purchase or otherwise acquire any shares of Common
Stock or Convertible Securities, the amount of the consideration other than cash
received by the Company shall be deemed to be the fair value of such
consideration as determined in good faith by the Board of Directors of the
Company. In case any shares of Common Stock or Convertible Securities or any
rights, options or warrants to subscribe for, purchase or otherwise acquire any
shares of Common Stock or Convertible Securities shall be issued or sold
together with other shares, stock or securities or other assets of the Company
for a consideration which covers both, the consideration for the issue or sale
of such shares of Common Stock or Convertible Securities or such rights or
options shall be deemed to be the portion of such consideration allocated
thereto in good faith by the Board of Directors of the Company.
10.3 VOLUNTARY ADJUSTMENT BY THE COMPANY. The Company may at
its option, at any time during the term of the Warrants, reduce the then current
Warrant Price to any amount deemed appropriate by the Board of Directors of the
Company.
10.4 NOTICE OF ADJUSTMENT. Whenever the number of Warrant
Shares purchasable upon the exercise of each Warrant or the Warrant Price of
such Warrant Shares is
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adjusted, as herein provided, to an extent that such adjustment is equal to or
greater than 5% of the Warrant Price in effect prior to such adjustment, the
Company shall cause the Warrant Agent promptly to mail by first class mail,
postage prepaid, to each Holder notice of such adjustment or adjustments and
shall deliver to the Warrant Agent a certificate of a firm of independent public
accountants selected by the Board of Directors of the Company (who may be the
regular accountants employed by the Company) setting forth the number of Warrant
Shares purchasable upon the exercise of each Warrant and the Warrant Price of
such Warrant Shares after such adjustment, setting forth a brief statement of
the facts requiring such adjustment and setting forth the computation by which
such adjustment was made. Such certificate shall be conclusive evidence of the
correctness of such adjustment. The Warrant Agent shall be entitled to rely on
such certificate and shall be under no duty or responsibility with respect to
any such certificate, except to exhibit the same, from time to time, to any
Holder desiring an inspection thereof during reasonable business hours. The
Warrant Agent shall not at any time be under any duty or responsibility to any
Holders to determine whether any facts exist which may require any adjustment of
the Warrant Price or the number of Warrant Shares or other stock or property
purchasable on exercise thereof, or with respect to the nature or extent of any
such adjustment when made, or with respect to the method employed in making such
adjustment.
10.5 NO ADJUSTMENT OF DIVIDENDS. Except as provided in
subsection 10.1, no adjustment in respect of any dividends shall be made during
the term of a Warrant or upon the exercise of a Warrant.
10.6 PRESERVATION OF PURCHASE RIGHTS RECLASSIFICATION,
CONSOLIDATION, ETC. In case of any consolidation of the Company with or merger
of the Company into another corporation or in case of any sale, transfer or
lease to another corporation of all or substantially all the property of the
Company, the Company or such successor or purchasing corporation, as the case
may be, shall execute with the Warrant Agent an agreement that (i) each Holder
shall have the right thereafter upon payment of the Warrant Price in effect
immediately prior to such action to purchase upon exercise of each Warrant the
kind and amount of shares and other securities and property (including cash)
which he would have owned or have been entitled to receive after the happening
of such consolidation, merger, sale, transfer or lease had such Warrant been
exercised immediately prior to such action; or (ii) in the event that all of the
property to which a Holder would be entitled to receive in such an action had
such Warrant been exercised immediately prior to such action is cash, then upon
surrender of a certificate representing Warrants each Holder shall be entitled
to receive cash in the amount of the difference between the amount which such
Holder would have paid to exercise such Warrants in full at the Warrant Price in
effect immediately prior to such action and the amount of cash which he would
have been entitled to receive after the happening of such consolidation, merger,
sale, transfer or lease had such Warrant been exercised immediately prior to
such action; provided, however, that no adjustment in respect of dividends,
interest or other income on or from such shares or other securities and property
shall be made during the term of a Warrant or upon the exercise of a Warrant.
The Company shall mail by first class mail, postage prepaid, to each Holder,
notice of the execution of any such agreement. Such agreement shall provide for
adjustments, which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 10. The provisions of this subsection
10.6 shall similarly apply to successive consolidations, mergers, sales,
transfers or leases. The Warrant Agent shall be under no duty or responsibility
to determine the correctness of any
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provisions contained in any such agreement relating to the kind or amount of
shares of stock or other securities or property receivable upon exercise of
Warrants or with respect to the method employed and provided therein for any
adjustments and shall be entitled to rely upon the provisions contained in any
such agreement.
10.7 STATEMENT ON WARRANTS. Irrespective of any adjustments in
the Warrant Price or the number or kind of shares purchasable upon the exercise
of the Warrants, Warrants theretofore or thereafter issued may continue to
express the same price and number and kind of shares as are stated in the
Warrants initially issuable pursuant to this Agreement.
SECTION 11. FRACTIONAL INTERESTS. The Company shall not be required to
issue fractional Warrant Shares on the exercise of Warrants. If more than one
Warrant shall be presented for exercise in full at the same time by the same
Holder, the number of full Warrant Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Warrant Shares purchasable on exercise of the Warrants so presented. If any
fraction of a Warrant Share would, except for the provisions of this Section 11,
be issuable on the exercise of any Warrant (or specified portion thereof), the
Warrant Agent shall pay (and shall be promptly reimbursed by the Company upon
demand therefor) an amount in cash equal to the closing price for one share of
the Common Stock, as defined in paragraph (d) of subsection 10.1, on the trading
day immediately preceding the date the Warrant is presented for exercise,
multiplied by such fraction.
SECTION 12. NO RIGHTS AS STOCKHOLDERS; NOTICES TO HOLDERS. Nothing
contained in this Agreement or in any of the Warrants shall be construed as
conferring upon the Holders or their transferees the right to vote or to receive
dividends or to consent or to receive notice as stockholders in respect of any
meeting of stockholders for the election of directors of the Company or any
other matter, or any rights whatsoever as stockholders of the Company. If,
however, at any time prior to the expiration of the Warrants and prior to their
exercise, any of the following events shall occur:
(a) the Company shall declare any dividend payable in any
securities upon its shares of Common Stock or make any distribution
(other than a cash dividend as to which no adjustment in the Warrant
Price is to be made as herein provided) to the holders of its shares of
Common Stock; or
(b) the Company shall offer to the holders of its shares of
Common Stock any additional shares of Common Stock or securities
convertible into shares of Common Stock or any right to subscribe
thereto; or
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation, merger, transfer or
lease of all or substantially all of its property, assets, and business
as an entirety) shall be proposed.
then in any one or more of said events the Company shall (a) give notice in
writing of such event to the Warrant Agent and the Holders as provided in
Section 18 hereof and (b) cause notice of such event to be published once in The
Wall Street Journal, such giving of notice and publication
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to be completed at least 20 days prior to the date fixed as a record date or the
date of closing the transfer books for the determination of the stockholders
entitled to such dividend, distribution, or subscription rights, or for the
determination of stockholders entitled to vote on such proposed dissolution,
liquidation or winding up. Such notice shall specify such record date or the
date of closing the transfer books, as the case may be. Failure to publish or
mail such notice or any defect therein or in the publication or mailing thereof
shall not affect the validity of any action taken in connection with such
dividend, distribution or subscription rights, or such proposed dissolution,
liquidation or winding up.
SECTION 13. DISPOSITION OF PROCEEDS ON EXERCISE OF WARRANTS; INSPECTION
OF WARRANT AGREEMENT. The Warrant Agent shall account to the Company with
respect to Warrants exercised two business days thereafter and concurrently pay
to the Company all monies received by the Warrant Agent for the purchase of the
Warrant Shares through the exercise of such Warrants.
The Warrant Agent shall keep copies of this Agreement and any notices
given or received hereunder available for inspection by the Holders during
normal business hours at its principal office. The Company shall supply the
Warrant Agent from time to time with such numbers of copies of this Agreement as
the Warrant Agent may request.
SECTION 14. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT.
Any corporation into which the Warrant Agent may be merged or with which it may
be consolidated, or any corporation resulting from any merger or consolidation
to which the Warrant Agent shall be a party, or any corporation succeeding to
the corporation trust business of the Warrant Agent, shall be the successor to
the Warrant Agent hereunder without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor Warrant Agent under
the provisions of Section 16 hereof. In case at the time such successor to the
Warrant Agent shall succeed to the agency created by this Agreement, any of the
Warrants shall have been countersigned but not delivered, any such successor to
the Warrant Agent may adopt the countersignature of the original Warrant Agent
and deliver such Warrants so countersigned; and in case at that time any of the
Warrants shall not have been countersigned, any successor to the Warrant Agent
may countersign such Warrants either in the name of the predecessor Warrant
Agent or in the name of the successor Warrant Agent; and in all such cases
Warrants shall have the full force provided in the Warrants and in this
Agreement.
In case at any time the name of the Warrant Agent shall be changed and
at such time any of the Warrants shall have been countersigned but not
delivered, the Warrant Agent may adopt the countersignatures under its prior
name and deliver such Warrants so countersigned; and in case at that time any of
the Warrants shall not have been countersigned, the Warrant Agent may
countersign such Warrants either in its prior name or in its changed name; and
in all such Warrants shall have the full force provided in the Warrants and in
this Agreement.
SECTION 15. CONCERNING THE WARRANT AGENT. The Warrant Agent undertakes
the duties and obligations imposed by this Agreement upon the following terms
and conditions, by all of which the Company and the Holders, by their acceptance
of Warrants, shall be bound.
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15.1 CORRECTNESS OF STATEMENTS. The statements contained
herein and in the Warrants shall be taken as statements of the Company and the
Warrant Agent assumes no responsibility for the correctness of any of the same
except such as describe the Warrant Agent or action taken by it. The Warrant
Agent assumes no responsibility with respect to the distribution of the Warrants
except as herein otherwise provided.
15.2 BREACH OF COVENANTS. The Warrant Agent shall not be
responsible for any failure of the Company to comply with any of the covenants
contained in this Agreement or in the Warrant to be complied with by the
Company.
15.3 PERFORMANCE OF DUTIES. The Warrant Agent may execute and
exercise any of the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents (which shall
not include its employees) and shall not be responsible for the misconduct or
negligence of any agent appointed with due care.
15.4 RELIANCE ON COUNSEL. The Warrant Agent may consult at any
time with legal counsel satisfactory to it and the Company (who may be counsel
for the Company) and the Warrant Agent shall incur no liability or
responsibility to the Company or to any Holder in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance with the
opinion or the advice of such counsel.
15.5 PROOF OF ACTIONS TAKEN. Whenever in the performance of
its duties under this Agreement the Warrant Agent shall deem it necessary or
desirable that any fact or matter be proved or established by the Company prior
to taking or suffering any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed) may be deemed
conclusively to be proved and established by a certificate signed by the
Chairman of the Board or President, a Vice President, the Treasurer or the
Secretary of the Company and delivered to the Warrant Agent; and such
certificate shall be full authorization to the Warrant Agent for any action
taken or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
15.6 COMPENSATION. The Company agrees to pay the Warrant Agent
reasonable compensation for all services rendered by the Warrant Agent in the
performance of its duties under this Agreement in accordance with the fee
schedule agreed to from time to time by the Company and the Warrant Agent, to
reimburse the Warrant Agent for all expenses, taxes and governmental charges and
other charges of any kind and nature reasonably incurred by the Warrant Agent in
the performance of its duties under this Agreement, and to indemnify the Warrant
Agent and save it harmless against any and all liabilities, including judgments,
costs and counsel fees, for anything done or omitted by the Warrant Agent in the
performance of its duties under this Agreement except as a result of the Warrant
Agent's negligence or bad faith.
15.7 LEGAL PROCEEDINGS. The Warrant Agent shall be under no
obligation to institute any action, suit or legal proceeding or to take any
other action likely to involve expense unless the Company or one or more Holders
shall furnish the Warrant Agent with reasonable security and indemnity for any
costs and expenses which may be incurred, but this provision shall
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not affect the power of the Warrant Agent to take such action as the Warrant
Agent may consider proper, whether with or without any such security or
indemnity. All rights of action under this Agreement or under any of the
Warrants may be enforced by the Warrant Agent without the possession of any of
the Warrants or the production thereof at any trial or other proceedings
relative thereto, any such action, suit or proceeding instituted by the Warrant
Agent shall be brought in its name as Warrant Agent, and any recovery of
judgment shall be for the ratable benefit of the Holders, as their respective
rights or interests may appear.
15.8 OTHER TRANSACTIONS IN SECURITIES OF COMPANY. The Warrant
Agent and any stockholder, director, officer or employee of the Warrant Agent
may buy, sell or deal in any of the Warrants, or other securities of the Company
or become pecuniarily interested in any transaction in which the Company may be
interested or contract with or lend money to the Company or otherwise act as
fully and freely as though it were not Warrant Agent under this Agreement.
Nothing herein shall preclude the Warrant Agent from acting in any other
capacity for the Company or for any other legal entity.
15.9 LIABILITY OF WARRANT AGENT. The Warrant Agent shall act
hereunder solely as agent, and its duties shall be determined solely by the
provisions hereof. The Warrant Agent shall not be liable for anything which it
may do or refrain from doing in connection with this Agreement except for its
own negligence or bad faith.
15.10 RELIANCE ON DOCUMENTS. The Warrant Agent will not incur
any liability or responsibility to the Company or to any Holder for any action
taken in reliance on any notice, resolution, waiver, consent, order,
certificate, or other paper, documents or instrument reasonably believed by it
to be genuine and to have been signed, set or presented by the proper party or
parties.
15.11 VALIDITY OF AGREEMENT. The Warrant Agent shall not be
under any responsibility in respect of the validity of this Agreement or the
execution and delivery hereof (except the due execution hereof by the Warrant
Agent) or in respect of the validity or execution of any Warrant (except its
countersignature thereof); nor shall the Warrant Agent by any act hereunder be
deemed to make any representation or warranty as to the authorization or
reservation of any Warrant Shares (or other stock) to be issued pursuant to this
Agreement or any Warrant, or as to whether any Warrant Shares (or other stock)
will, when issued, be validly issued, fully paid and nonassessable, or as to the
Warrant Price or the number or amount of Warrant Shares or other securities or
other property issuable upon exercise of any Warrant.
15.12 INSTRUCTIONS FROM COMPANY. The Warrant Agent is hereby
authorized and directed to accept instructions with respect to the performance
of its duties hereunder from the Chairman of the Board, the President, a Vice
President, the Secretary or the Treasurer of the Company, and to apply to such
officer for advice or instructions in connection with its duties, and shall not
be liable for any action taken or suffered to be taken by it in good faith in
accordance with instructions of any such officer or officers.
SECTION 16. CHANGE OF WARRANT AGENT. The Warrant Agent may resign and
be discharged from its duties under this Agreement by giving to the Company 30
days notice in
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writing. The Warrant Agent may be removed by like notice to the Warrant Agent
from the Company. If the Warrant Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall appoint a successor to
the Warrant Agent. If the Company shall fail to make such appointment within a
period of 30 days after such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Warrant Agent
or by any Holder (who shall with such notice submit his Warrant for inspection
by the Company), then any Holder may apply to any court of competent
jurisdiction for the appointment of a successor to the Warrant Agent. Any
successor warrant agent, whether appointed by the Company or such a court, shall
be a bank or trust company, in good standing, incorporated under the laws of the
United States of America or any state thereof and having at the time of its
appointment as warrant agent a combined capital and surplus of at least
$100,000,000. After appointment, the successor warrant agent shall be vested
with the same powers, rights, duties and responsibilities as if it had been
originally named as Warrant Agent without further act or deed, but the former
Warrant Agent shall deliver and transfer to the successor warrant agent any
property at the time held by it hereunder, and execute and deliver for further
assurance, conveyance, act or deed necessary for the purpose. Failure to file
any notice provided for in this Section 16, however, or any defect therein,
shall not affect the legality or validity of the resignation or removal of the
Warrant Agent or the appointment of the successor warrant agent, as the case may
be. In the event of such resignation or removal, the successor warrant agent
shall mail, by first class mail, postage prepaid, to each Holder, written notice
of such removal or resignation and the name and address of such successor
warrant agent.
SECTION 17. IDENTITY OF TRANSFER AGENT. Forthwith upon the appointment
of any subsequent transfer agent for the Common Stock, or any other shares of
the Company's capital stock issuable upon the exercise of the Warrants, the
Company will file with the Warrant Agent a statement setting forth name and
address of such subsequent transfer agent.
SECTION 18. NOTICES. Any notice pursuant to this Agreement by the
Company or by any Holder to the Warrant Agent, or by the Warrant Agent or by any
Holder to the Company, shall be in writing and shall be delivered in person or
by facsimile transmission, or mailed first class, postage prepaid (a) to the
Company, at its offices at ; or (b) the Warrant agent, to [Bank] . Each party
hereto may from time to time change the address to which notices to it are to be
delivered or mailed hereunder by notice to the other party.
Any notice mailed pursuant to this Agreement by the Company or the
Warrant Agent to the Holders shall be in writing and shall be mailed first
class, postage prepaid, or otherwise delivered to such Holders at their
respective addresses on the books of the Warrant Agent.
SECTION 19. SUPPLEMENTS AND AMENDMENTS. The Company and the Warrant
Agent may from time to time supplement or amend this Agreement without the
approval of any Holder, in order to cure any ambiguity or to correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provision herein, or to make any other provisions in regard to
matters or questions arising hereunder which the Company and the Warrant Agent
may deem necessary or desirable and which shall not be inconsistent with the
provisions of the Warrants and which shall not adversely affect the interests of
the Holders.
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This Agreement shall not otherwise be modified, supplemented or altered
in any respect except with the consent in writing of the Holders of Warrants
representing not less than 50% of the Warrants then outstanding; and provided,
further, that no change in (i) the number or nature of the securities
purchasable upon the exercise of any Warrant, (ii) the Warrant Price therefor,
(iii) the acceleration of the Expiration Date, or (iv) the anti-dilution
provisions of Section 10 hereof which would adversely affect the interests of
any Holder shall be made without the consent in writing of the Holder of the
certificate representing such Warrant, other than such changes as are
specifically prescribed by this Agreement as originally executed or are made in
compliance with applicable law.
SECTION 20. SUCCESSORS. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
SECTION 21. MERGER OR CONSOLIDATION OF THE COMPANY. The Company will
not merge or consolidate with or into, or sell, transfer or lease all or
substantially all of its property to, any other corporation unless the successor
or purchasing corporation, as the case may be (if not the Company), shall
expressly assume, by supplemental agreement satisfactory in form to the Warrant
Agent and executed and delivered to the Warrant Agent, the due and punctual
performance and observance of each and every covenant and condition of this
Agreement to be performed and observed by the Company.
SECTION 22. APPLICABLE LAW. This Agreement and each Warrant issued
hereunder shall be governed by and construed in accordance with the laws of the
State of Ohio, without giving effect to principles of conflict of laws.
SECTION 23. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall
be construed to give to any person or corporation other than the Company, the
Warrant Agent, and the Holders any legal or equitable right, remedy or claim
under this Agreement; but this Agreement shall be for the sole and exclusive
benefit of the Company, the Warrant Agent and the Holders of the Warrants.
SECTION 24. COUNTERPARTS. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same instrument.
SECTION 25. CAPTIONS. The captions of the Sections and subsections of
this Agreement have been inserted for convenience only and shall have no
substantive effect.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, all as of the day and year first above written.
JACOR COMMUNICATIONS, INC..
[SEAL] By:_____________________________
Title:__________________________
Attest:
_______________________
Secretary
KEYCORP SHAREHOLDER SERVICES,
INC.
as Warrant Agent
[SEAL] By:_____________________________
Title:__________________________
Attest:
_______________________
Corporate Trust Officer
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EXHIBIT A TO THE WARRANT AGREEMENT
VOID AFTER 5:00 P.M. EASTERN TIME, ________________, 2001
No. Warrants to Purchase
[_______] Shares of Common Stock
JACOR COMMUNICATIONS, INC.
COMMON STOCK PURCHASE WARRANTS
This certifies that, for value received, __________________________ or
registered assigns (the "Holder"), is entitled to purchase from Jacor
Communications, Inc., an Ohio corporation (the "Company") , at any time, at the
purchase price of $_______ per share (the "Warrant Price"), the number of shares
of Common Stock, without par value, of the Company ("Common Stock"), shown
above. The number of shares purchasable upon exercise of the Warrants and the
Warrant Price are subject to adjustment from time to time as set forth in the
Warrant Agreement referred to below.
Warrants may be exercised in whole or in part by presentation of this
Warrant Certificate with the Purchase Form on the reverse side hereof duly
executed, which signature shall be guaranteed by a bank or trust company or a
broker or dealer which is a member of the National Association of Securities
Dealers, Inc., and simultaneous payment of the Warrant Price at the principal
office of KeyCorp Shareholder Services, Inc. (the "Warrant Agent") in
________________. Payment of such price shall be made at the option of the
Holder hereof in cash or by certified or bank cashier's check drawn upon a bank
chartered by the government of the United States or any state thereof.
This Warrant Certificate is issued under and in accordance with a
Warrant Agreement dated as of ________________________, 1996, between the
Company and the Warrant Agent and is subject to the terms and
provisions contained in the Warrant Agreement, to all of which the Holder of
this Warrant Certificate by acceptance hereof consents. A copy of the Warrant
Agreement may be obtained by the Holder hereof upon written request to the
Company.
Upon any partial exercise of the Warrants evidenced by this Warrant
Certificate, there shall be countersigned and issued to the Holder hereof a new
Warrant Certificate for the shares of Common Stock as to which the Warrants
evidenced by this Warrant Certificate shall not have been exercised. This
Warrant Certificate may be exchanged at the office of the Warrant Agent by
surrender of this Warrant Certificate properly endorsed either separately or in
combination with one or more other Warrant Certificates for one or more new
Warrant Certificates evidencing the right of the Holder thereof to purchase the
same aggregate number of shares as were purchasable on exercise of the Warrants
evidenced by the Warrant Certificate or Certificates exchanged. No fractional
shares will be issued upon the exercise of any Warrant, but the
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Company will pay the cash value thereof determined as provided in the Warrant
Agreement. This Warrant Certificate is transferable at the office of the Warrant
Agent in the manner and subject to the limitations set forth in the Warrant
Agreement.
The Holder hereof may be treated by the Company, the Warrant Agent, and
all other persons dealing with this Warrant Certificate as the absolute owner
hereof for any purpose and as the person entitled to exercise the rights
represented hereby, or to the transfer hereof on the books of the Company any
notice to the contrary notwithstanding, and until such transfer on such books,
the Company may treat the Holder thereof as the owner for all purposes.
Neither the Warrants nor this Warrant Certificate entitle any Holder
hereof to any of the rights of a stockholder of the Company.
This Warrant Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Warrant Agent.
DATED:
COUNTERSIGNED:
[ Bank ]
Warrant Agent
By:________________________________
Authorized Signature
JACOR COMMUNICATIONS, INC.
Attest:____________________________ By:____________________________
Secretary Title:_________________________
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JACOR COMMUNICATIONS, INC.
PURCHASE FORM
(To be executed upon exercise of Warrant)
Warrant Agent
The undersigned hereby irrevocably elects to exercise the right to
purchase _____________ shares of Common Stock evidenced by the within Warrant
Certificate, according to the terms and conditions thereof, and herewith makes
payment of the purchase price in full by tendering cash or certified or bank
cashier's check drawn upon a bank chartered by the government of the United
States or any state thereof in the aggregate amount of $_________________. The
undersigned requests that certificates for such shares of Common Stock shall be
issued in the name of
___________________________________________________________________________
(Please print Name, Address and Social Security No.)
___________________________________________________________________________
___________________________________________________________________________
and, if said number of shares shall not be all the shares purchasable
thereunder, that a New Warrant Certificate for the balance remaining of the
shares purchasable under the within Warrant Certificate be issued in the name of
the undersigned Warrantholder or his Assignee as below indicated and delivered
to the address stated below.
DATED: ___________________, ______
Name of Warrantholder or Assignee:________________________________________
(Please Print)
Address:__________________________________________________________________
__________________________________________________________________
Signature:__________________________________________
Signature Guaranteed: (The above signature must correspond with
the name as written upon the face of this Warrant
Certificate in every particular, without alteration
or enlargement or any change whatever, unless this
Warrant Certificate has been assigned.)
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ASSIGNMENT
(To be signed only upon assignment of Warrant Certificate)
FOR VALUED RECEIVED, the undersigned hereby sells, assigns and
transfers unto ____
_______________________________________________________________________________
(Name and Address of Assignee Must be Printed or Typewritten)
the within Warrant Certificate, irrevocably constituting and appointing
______________________________________________________________, Attorney to
transfer said Warrant Certificate on the books of the Company, with full power
of substitution in the premises.
DATED: ________________________, ______
Signature:__________________________________
Signature Guaranteed: (The above signature must
correspond with the name as written
on the face of this Warrant
Certificate in every particular,
without alteration or enlargement
or any change whatever.)
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