EXHIBIT 1.1
Clear Channel Communications, Inc.
Underwriting Agreement
New York, New York
September 15, 2004
To the Representatives
named in Schedule I
hereto of the Under-
writers named in
Schedule II hereto
Ladies and Gentlemen:
Clear Channel Communications, Inc., a Texas corporation (the
"Company"), proposes to sell to the underwriters named in Schedule II hereto
(the "Underwriters"), for whom you (the "Representatives") are acting as
representatives, the principal amount of its securities identified in Schedule I
hereto of the Company, to be issued under an indenture dated as of October 1,
1997, between the Company and The Bank of New York, as trustee (the "Trustee"),
as amended by the Seventeenth Supplemental Indenture dated as of September 20,
2004 (as so amended, the "Indenture") (said principal amount to be issued and
sold by the Company being hereinafter called the "Securities"). If the firm or
firms listed in Schedule II hereto include only the firm or firms listed in
Schedule I hereto, then the terms "Underwriters" and "Representatives", as used
herein, shall each be deemed to refer to such firm or firms. To the extent there
are no additional Underwriters listed on Schedule I other than you, the term
Representatives as used herein shall mean you, as Underwriters, and the terms
Representatives and Underwriters shall mean either the singular or plural as the
context requires. Any reference herein to the Registration Statement, the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus, shall
except as specified therein, be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 which were
filed under the Exchange Act on or before the Effective Date of the Registration
Statement or the issue date of the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus, as the case may be; and any reference herein
to the terms "amend", "amendment" or "supplement" with respect to the
Registration Statement, the Basic Prospectus, any Preliminary Final Prospectus
or the Final Prospectus shall be deemed to refer to and include the filing of
any document under the Exchange Act after the Effective Date of the Registration
Statement or the issue date of the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus, as the case may be, deemed to be
incorporated therein by reference. The use of the neuter in this Agreement shall
include the feminine and masculine wherever appropriate.
1. Representations and Warranties. The Company represents and
warrants to, and agrees with, each Underwriter as set forth below in this
Section 1. Certain terms used in this Section 1 are defined in Section 16
hereof.
(a) The Company meets the requirements for the use of Form S-3 under
the Act and has filed with the Commission a registration statement (the
file number of which is set forth in Schedule I hereto) on such Form,
including a basic prospectus, for registration under the Act of the
offering and sale of the Securities. The Company may have filed one or
more amendments thereto, including a Preliminary Final Prospectus, each of
which has previously been furnished to you. The Company will next file
with the
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Commission one of the following: (x) a final prospectus supplement
relating to the Securities in accordance with Rules 430A and 424(b), (y)
prior to the Effective Date of such registration statement, an amendment
to such registration statement, including the form of final prospectus
supplement, or (z) a final prospectus in accordance with Rules 415 and
424(b). In the case of clause (x), the Company has included in such
registration statement, as amended at the Effective Date, all information
(other than Rule 430A Information) required by the Act and the rules
thereunder to be included in such registration statement and the Final
Prospectus. As filed, such final prospectus supplement or such amendment
and form of final prospectus supplement shall contain all Rule 430A
Information, together with all other such required information, and,
except to the extent the Representatives shall agree in writing to a
modification, shall be in all substantive respects in the form furnished
to you prior to the Execution Time or, to the extent not completed at the
Execution Time, shall contain only such specific additional information
and other changes (beyond that contained in the Basic Prospectus and any
Preliminary Final Prospectus) as the Company has advised you, prior to the
Execution Time, will be included or made therein.
(b) On the Effective Date, the Registration Statement did or will,
and when the Final Prospectus is first filed (if required) in accordance
with Rule 424(b) and on the Closing Date (as defined herein), the Final
Prospectus (and any supplement thereto) will, comply in all material
respects with the applicable requirements of the Act, the Exchange Act and
The Trust Indenture Act and the respective rules thereunder; on the
Effective Date and at the Execution Time, the Registration Statement did
not or will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; on the Effective Date
and on the Closing Date the Indenture did or will comply in all material
respects with the requirements of the Trust Indenture Act and the rules
thereunder; and, on the Effective Date, the Final Prospectus, if not filed
pursuant to Rule 424(b), will not, and on the date of any filing pursuant
to Rule 424(b) and on the Closing Date, the Final Prospectus (together
with any supplement thereto) will not, include any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that the Company makes no
representations or warranties as to (i) that part of the Registration
Statement which shall constitute the Statement of Eligibility and
Qualification (Form T-1) under the Trust Indenture Act of the Trustee or
(ii) the information contained in or omitted from the Registration
Statement or the Final Prospectus (or any supplement thereto) in reliance
upon and in conformity with information furnished herein or in writing to
the Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion in the Registration Statement or the Final
Prospectus (or any supplement thereto), it being understood that the
information referred to in this clause (b)(ii) shall be limited to the
information described in Section 7(b) hereof.
(c) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Texas, with
corporate power and authority to own its properties and conduct its
business as described in the Final Prospectus; each of the subsidiaries of
the Company as listed on Schedule III hereto (collectively, the
"Subsidiaries") has been duly organized and is validly existing in good
standing under the laws of the jurisdiction of its organization, with
power and authority to own or lease its properties and conduct its
business as described in the Final Prospectus; the Company and each of the
Subsidiaries are duly qualified to transact business in all
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jurisdictions in which the conduct of their business requires such
qualification and a failure to qualify would have a material adverse
effect upon the business or financial condition of the Company and the
Subsidiaries taken as a whole; except as set forth on Schedule III hereto,
or as described in the Final Prospectus, the outstanding shares of capital
stock of each of the Subsidiaries owned by the Company or a Subsidiary
have been duly authorized and validly issued, are fully paid and
nonassessable and are owned by the Company or another subsidiary free and
clear of all liens, encumbrances and security interests and no options,
warrants or other rights to purchase, agreements or other obligations to
issue or other rights to convert any obligations into shares of capital
stock or ownership interests in the Subsidiaries are outstanding.
(d) The authorized shares of Common Stock of the Company have been
duly authorized. The outstanding shares of Common Stock of the Company
have been duly authorized and are validly issued, fully-paid and
non-assessable.
(e) This Agreement has been duly authorized, executed and delivered
by the Company and is a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms.
(f) The Indenture and the Securities conform in all material
respects with the statements concerning them in the Final Prospectus.
(g) The Commission has not issued an order preventing or suspending
the use of any Basic Prospectus, Preliminary Final Prospectus or Final
Prospectus relating to the proposed offering of the Securities nor
instituted proceedings for that purpose.
(h) The consolidated financial statements of the Company and its
subsidiaries, together with related notes and schedules incorporated by
reference in the Final Prospectus present fairly the financial position
and the results of operations of the Company and its subsidiaries
consolidated, at the indicated dates and for the indicated periods. Such
financial statements have been prepared in accordance with generally
accepted principles of accounting, consistently applied throughout the
periods involved, and all adjustments necessary for a fair presentation of
results for such periods have been made. The selected and summary
financial and statistical data included in the Final Prospectus present
fairly the information shown therein and have been compiled on a basis
consistent with the financial statements incorporated by reference therein
and the books and records of the Company. The pro forma financial
information, if any, included in the Final Prospectus presents fairly the
information shown therein, have been properly compiled on the pro forma
bases described therein, and, in the opinion of the Company, the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein.
(i) Except for those license renewal applications of the Company or
its subsidiaries currently pending before the Federal Communications
Commission (the "FCC"), or as set forth in the Final Prospectus or on
Schedule III, there is no action or proceeding pending or, to the
knowledge of the Company, threatened against the Company or any of the
Subsidiaries before any court or administrative agency which could
reasonably be likely to result in any material adverse change in the
earnings, business, management, properties, assets, rights, operations,
condition (financial or otherwise) of the Company and of the Subsidiaries
(taken as a whole).
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(j) The Company and the Subsidiaries have good and marketable title
to all of the properties and assets reflected in the financial statements
herein above described (or as described in the Final Prospectus) subject
to no material lien, mortgage, pledge, charge or encumbrance of any kind,
except those reflected in such financial statements or as described in the
Final Prospectus or set forth on Schedule III. The Company and the
Subsidiaries occupy their leased properties under valid leases with such
exceptions as are not material to the Company and the subsidiaries taken
as a whole and do not materially interfere with the use made and proposed
to be made of such properties by the Company and the Subsidiaries.
(k) The Company and the Subsidiaries have filed all Federal, State
and foreign income tax returns which have been required to be filed and
have paid all taxes indicated by said returns and all assessments received
by them or any of them to the extent that such taxes have become due and
are not being contested in good faith. The Company has no knowledge of any
tax deficiency that has been or might be asserted against the Company that
would have a material adverse effect on the Company and its subsidiaries
taken as a whole.
(l) Since the last date as of which information is given in the
Final Prospectus, as it may be amended or supplemented, there has not been
any material adverse change or any development involving a prospective
material adverse change in or affecting the earnings, business,
management, properties, assets, rights, operations, condition (financial
or otherwise) or business prospects of the Company and its subsidiaries
(taken as a whole), whether or not occurring in the ordinary course of
business, other than general economic and industry conditions, changes in
the ordinary course of business and changes or transactions described or
contemplated in the Final Prospectus, and there has not been any material
definitive agreement entered into by the Company or the Subsidiaries,
other than transactions in the ordinary course of business and changes and
transactions contemplated by the Final Prospectus, as it may be amended or
supplemented. None of the Company or the Subsidiaries have any material
contingent obligations which are not disclosed in the Final Prospectus, as
it may be amended or supplemented.
(m) Neither the Company nor any of the Subsidiaries is or with the
giving of notice or lapse of time or both, will be in default under its
certificate or articles of incorporation, by-laws or partnership
agreements or any agreement, lease, contract, indenture or other
instrument or obligation to which it is a party or by which it, or any of
its properties, is bound and which default is of material significance in
respect of the business or financial condition of the Company and its
subsidiaries (taken as a whole). The execution and delivery of this
Agreement and the consummation of the transactions herein contemplated and
the fulfillment of the terms hereof will not conflict with or result in a
breach of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust or other material agreement
or instrument to which the Company or any Subsidiary is a party, or of the
certificate or articles of incorporation or by-laws of the Company or any
order, rule or regulation applicable to the Company or any Subsidiary, or
of any court or of any regulatory body or administrative agency or other
governmental body having jurisdiction, except in all cases a conflict,
breach or default which would not have a materially adverse effect on the
business or financial condition of the Company and the subsidiaries (taken
as a whole).
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(n) Each approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body necessary in connection with the execution and delivery
by the Company of this Agreement and the consummation of the transactions
herein contemplated (except such additional steps as may be required by
the National Association of Securities Dealers, Inc. ("NASD") or the New
York Stock Exchange ("NYSE") or as may be necessary to qualify the
Securities for public offering by the Underwriters under State securities
or Blue Sky laws) has been obtained or made and is in full force and
effect.
(o) The Company and each of the Subsidiaries hold all material
licenses, certificates and permits from governmental authorities,
including without limitation, the FCC, which are necessary to the conduct
of their businesses; and neither the Company nor any of the Subsidiaries
has received notice of any infringement of any material patents, patent
rights, trade names, trademarks or copyrights, which infringement is
material to the business of the Company and the Subsidiaries (taken as a
whole).
(p) Ernst & Young LLP, who has certified certain of the financial
statements incorporated by reference in the Final Prospectus, is to the
knowledge of the Company an independent registered public accounting firm
as required by the Act and the Rules and Regulations.
(q) To the Company's knowledge, there are no affiliations or
associations between any member of the National Association of Securities
Dealers and any of the Company's officers, directors or 5% or greater
security holders except as otherwise disclosed in writing to Citigroup
Global Markets Inc. or set forth in Schedule III.
(r) Neither the Company nor any Subsidiary is an "investment
company" within the meaning of such term under the Investment Company Act
of 1940 and the rules and regulations of the Commission thereunder.
(s) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(t) The Company and each of its Subsidiaries carry, or are covered
by, insurance, including self insurance, in such amounts and covering such
risks as is adequate for the conduct of their respective businesses and
the value of their respective properties and as is customary for companies
engaged in similar industries.
(u) The Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income Security
Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"); no "reportable event" (as defined in
ERISA) for which the Company would have any liability has occurred and is
continuing; the Company has not incurred and does not
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expect to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii) Sections
412 or 4971 of the Internal Revenue Code of 1986, as amended, including
the regulations and published interpretations thereunder (the "Code"); and
each "pension plan" for which the Company would have any liability that is
intended to be qualified under Section 401(a) of the Code is so qualified
in all material respects and nothing has occurred, whether by action or by
failure to act, which would cause the loss of such qualification and where
any such noncompliance, "reportable event," liability or nonqualification,
alone or in the aggregate, would not have a material adverse effect on the
Company and its subsidiaries taken as a whole.
Any certificate signed by any officer of the Company and delivered
to the Representatives or counsel for the Underwriters in connection with the
offering of the Securities shall be deemed solely to be a representation and
warranty by the Company, as to matters covered thereby, to each Underwriter.
2. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase at the purchase price set forth on Schedule I, the
principal amount of Securities set forth opposite such Underwriter's name in
Schedule II.
3. Delivery and Payment. Delivery of and payment for the
Securities shall be made on the date and at the time specified in Schedule I
hereto, which date and time may be postponed by agreement among the
Representatives and the Company or as provided in Section 8 hereof (such date
and time of delivery and payment for the Securities being herein called the
"Closing Date"). Delivery of the Securities shall be made to the Representatives
for the respective accounts of the several Underwriters against payment by the
several Underwriters through the Representatives of the respective aggregate
purchase prices of the Securities being sold by the Company to or upon the order
of the Company by wire transfer payable in same-day funds to an account
specified by the Company. Delivery of the Securities shall be made through the
facilities of The Depository Trust Company unless the Representatives shall
otherwise instruct.
4. Agreements. The Company agrees with the several Underwriters
that:
(a) The Company will use its reasonable best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereto, to become effective. Prior to the termination of the
offering of the Securities, the Company will not file any amendment of the
Registration Statement or supplement (including the Final Prospectus or
any Preliminary Final Prospectus) to the Basic Prospectus or any Rule
462(b) Registration Statement unless the Company has furnished you a copy
for your review prior to filing and will not file any such proposed
amendment or supplement to which you reasonably object in writing. Subject
to the foregoing sentence, the Company will cause the Final Prospectus,
properly completed, and any supplement thereto to be filed with the
Commission pursuant to the applicable paragraph of Rule 424(b) within the
time period prescribed and will provide evidence satisfactory to the
Representatives of such timely filing. The Company will promptly advise
the Representatives (i) when the Registration Statement, if not effective
at the Execution Time, shall have become effective, (ii) when the Final
Prospectus, and any supplement thereto, shall have been filed with the
Commission pursuant to Rule 424(b) or when any
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Rule 462(b) Registration Statement shall have been filed with the
Commission, (iii) when, prior to termination of the offering of the
Securities, any amendment to the Registration Statement shall have been
filed or become effective, (iv) of any request by the Commission or its
staff for any amendment of the Registration Statement, or any Rule 462(b)
Registration Statement, or for any supplement to the Final Prospectus or
of any additional information, (v) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement
or the institution or threatening of any proceeding for that purpose and
(vi) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Company will use its reasonable efforts to prevent the
issuance of any such stop order or the suspension of any such
qualification and, if issued, to obtain as soon as possible the withdrawal
thereof.
(b) If, at any time when a prospectus relating to the Securities
is required to be delivered under the Act, any event occurs as a result of
which the Final Prospectus as then supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein in the light of the circumstances under
which they were made not misleading, or if it shall be necessary to amend
the Registration Statement or supplement the Final Prospectus to comply
with the Act or the Exchange Act or the respective rules thereunder, the
Company promptly will (i) prepare and file with the Commission, subject to
the second sentence of paragraph (a) of this Section 4, an amendment or
supplement or, if appropriate, a filing under the Exchange Act, which will
correct such statement or omission or effect such compliance and (ii)
supply any supplemented Final Prospectus to you in such quantities as you
may reasonably request.
(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an earnings
statement or statements of the Company and its subsidiaries which will
satisfy the provisions of Section 11(a) of the Act and Rule 158 under the
Act.
(d) The Company will furnish to the Representatives and counsel
for the Underwriters, without charge, copies of the Registration Statement
(including exhibits thereto) and, so long as delivery of a prospectus by
an Underwriter or dealer may be required by the Act, as many copies of any
Preliminary Final Prospectus and the Final Prospectus and any supplement
thereto as the Representatives may reasonably request. The Company will
pay the expenses of printing or other production of all documents relating
to the offering.
(e) The Company will arrange, if necessary, for the qualification
of the Securities for sale under the laws of such jurisdictions as the
Representatives may designate, will maintain such qualifications in effect
so long as required for the distribution of the Securities and will pay
any fee of the National Association of Securities Dealers, Inc., in
connection with its review of the offering, provided that the Company will
not be required to file a consent to service of process in any state in
which it is not qualified or for which consent has not been given.
(f) The Company shall not invest, or otherwise use the proceeds
received by the Company from its sale of the Securities in such a manner
as would require the Company
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or any of the Subsidiaries to register as an investment company under the
Investment Company Act of 1940, as amended (the "1940 Act").
5. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Securities shall be subject to
the accuracy of the representations and warranties on the part of the Company
contained herein as of the Execution Time and the Closing Date pursuant to
Section 3 hereof, to the accuracy of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior
to the Execution Time, unless the Representatives agree in writing to a
later time, the Registration Statement will become effective not later
than (i) 6:00 PM New York City time, on the date of determination of the
public offering price, if such determination occurred at or prior to 3:00
PM New York City time on such date or (ii) 9:30 AM on the Business Day
following the day on which the public offering price was determined, if
such determination occurred after 3:00 PM New York City time on such date;
if filing of the Final Prospectus, or any supplement thereto, is required
pursuant to Rule 424(b), the Final Prospectus, and any such supplement,
shall have been filed in the manner and within the time period required by
Rule 424(b); and no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
(b) The Company shall have furnished to the Representatives the
opinion of Akin Gump Xxxxxxx Xxxxx & Xxxx LLP, counsel for the Company,
dated the Closing Date, to the effect that:
(i) The Company is validly existing as a corporation in good
standing under the laws of the State of Texas, with corporate power
and authority to own or lease its properties and conduct its
business as described in the Final Prospectus; and the outstanding
shares of capital stock of each of the Subsidiaries have been duly
authorized and validly issued, are fully paid and non-assessable;
and, to the best of such counsel's knowledge, except (A) as
reflected in the Company's financial statements, (B) as described in
the Registration Statement or (C) as set forth on Schedule III
hereto or as disclosed in such counsel's opinion, (x) the
outstanding shares of capital stock of each of the Subsidiaries are
owned by the Company or its subsidiary free and clear of all liens,
encumbrances and security interests and (y) no options, warrants or
other rights to purchase, agreements or other obligations to issue,
or other rights to convert any obligations into any shares of
capital stock or of ownership interests in the Subsidiaries are
outstanding.
(ii) The Indenture and the Securities conform in all material
respects to the descriptions thereof contained in the Final
Prospectus.
(iii) Except as described in the Final Prospectus, to the
knowledge of such counsel, no holder of any securities of the
Company or any other person has the right, contractual or otherwise,
which has not been satisfied or effectively waived, to cause the
Company to sell or otherwise issue to them, or to permit them to
underwrite the sale of, any of the Securities or the right to have
any Common Stock or other securities of the Company included in the
Registration
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Statement or the right, as a result of the filing of the
Registration Statement, to require registration under the Act of any
shares of Common Stock or other securities of the Company.
(iv) the Indenture has been duly authorized, executed and
delivered, has been duly qualified under the Trust Indenture Act,
and constitutes a legal, valid and binding instrument enforceable
against the Company in accordance with its terms and the Securities
have been duly authorized and, when executed and authenticated in
accordance with the provisions of the Indenture and delivered to and
paid for by the Underwriters pursuant to this Agreement, will
constitute legal, valid and binding obligations of the Company
entitled to the benefits of the Indenture (subject, in respect to
both the Indenture and the Securities, as to enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency,
fraudulent conveyance or transfer, moratorium or other laws
affecting creditors' rights generally from time to time in effect);
(v) The Registration Statement has become effective under
the Act and, to the knowledge of such counsel, no stop order
proceedings with respect thereto have been instituted or are pending
or threatened under the Act.
(vi) The Registration Statement, the Final Prospectus and
each amendment or supplement thereto and documents incorporated by
reference therein (each as amended to date) comply as to form in all
material respects with the requirements of the Act or the Exchange
Act, as applicable and the applicable rules and regulations
thereunder (except that such counsel need express no opinion as to
the statistical information contained in the Final Prospectus or
financial statements, schedules and other financial information
incorporated by reference therein).
(vii) The statements under the captions "Business" and
"Description of the Notes" in the Final Prospectus, insofar as such
statements constitute a summary of documents referred to therein or
matters of law, are accurate summaries and fairly and accurately
present the information called for with respect to such documents
and matters in all material respects.
(viii) Except as set forth on Schedule III, to such counsel's
knowledge, there are no contracts or documents required to be filed
as exhibits to the Registration Statement or described in the
Registration Statement or the Final Prospectus (excluding any
document incorporated therein by reference) which are not so filed
or described as required, and such contracts and documents as are
summarized in the Registration Statement or the Final Prospectus
(excluding any document incorporated therein by reference) are
fairly summarized in all material respects.
(ix) Except as set forth on Schedule III, to such counsel's
knowledge, there are no material legal proceedings pending or
threatened against the Company or any of the Subsidiaries which are
of a character required to be disclosed in the Final Prospectus and
which has not been properly disclosed therein.
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(x) The execution and delivery of the Indenture, the
issuance and sale of the Securities and the execution and delivery
of this Agreement and the consummation of the transactions herein
contemplated do not and will not conflict with or result in a breach
of any of the terms or provisions of, or constitute a default under,
(a) the Articles of Incorporation or (b) By-laws of the Company, or
(c) to such counsel's knowledge, any agreement or instrument filed
as an exhibit to the Company's most recent annual report on Form
10-K or any subsequent quarterly report of the Company on Form 10-Q
(other than licenses or permits granted by the FCC, on which such
counsel need not express any opinion), or (d) will not contravene
any law, rule or regulation of the United States or the State of
Texas or the General Corporation Law of the State of Delaware, or,
to such counsel's knowledge, any order or decree of any court or
governmental agency or instrumentality, except, with respect to
clause (c) above, a conflict, breach or default which would not have
a materially adverse effect on the business or financial condition
of the Company and its subsidiaries taken as a whole.
(xi) This Agreement has been duly authorized, executed and
delivered by the Company.
(xii) No approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory,
administrative or other governmental body having jurisdiction over
the Company is necessary in connection with the execution and
delivery of this Agreement and the consummation of the transactions
herein contemplated (other than as may be required by the NASD or
NYSE or as required by State securities and Blue Sky laws as to
which such counsel need express no opinion) except such as have been
obtained or made, specifying the same.
(xiii) The Company is not, and will not become, as a result of
the consummation of the transactions contemplated by this Agreement,
and application of the net proceeds therefor as described in the
Final Prospectus, required to register as an investment company
under the 1940 Act.
In rendering such opinion, such counsel may rely (A) as to matters
governed by the laws of states other than Texas or Federal laws on local
counsel in such jurisdictions, provided that in each case such counsel
shall state that they believe that they and the Underwriters are justified
in relying on such other counsel and (B) as to matters of fact, on
certificates of responsible officers of the Company and certificates or
other written statements of officers or departments of various
jurisdictions having custody of documents respecting the corporate
existence or good standing of the Company and any Subsidiary. In addition
to the matters set forth above, such opinion shall also include a
statement to the effect that nothing has come to the attention of such
counsel which leads them to believe that the Registration Statement, as of
the time it became effective under the Act, the Final Prospectus or any
amendment or supplement thereto, on the date it was filed pursuant to Rule
424(b) and the Registration Statement and the Final Prospectus, or any
amendment or supplement thereto, as of the Closing Date, contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading (except that such counsel need express no view as to matters
pertaining to the statistical information contained in the Final
Prospectus or financial statements, schedules and other financial
information contained or incorporated
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by reference in the Final Prospectus). With respect to such statement,
such counsel may state that their belief is based upon the procedures set
forth therein, but is without independent check and verification.
(c) The Underwriters shall have received on the Closing Date the
opinion of Xxxxx Xxxx & Xxxxxxxx LLP, special FCC counsel to the Company,
dated the Closing Date, addressed to the Underwriters as is reasonably
acceptable to the Underwriters.
(d) The Representatives shall have received from Cravath, Swaine &
Xxxxx LLP, counsel for the Underwriters, such opinion or opinions, dated
the Closing Date, with respect to the issuance and sale of the Securities,
the Registration Statement, the Final Prospectus (together with any
supplement thereto) and other related matters as the Representatives may
reasonably require, and the Company shall have furnished to such counsel
such documents as they request for the purpose of enabling them to pass
upon such matters.
(e) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chief Executive Officer or the
President and the principal financial or accounting officer of the
Company, in their capacity as such, dated the Closing Date, to the effect
that the signers of such certificate have carefully examined the
Registration Statement, the Final Prospectus, any supplements to the Final
Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in
this Agreement are true and correct in all material respects on and
as of the Closing Date with the same effect as if made on the
Closing Date, and the Company has complied with all the agreements
and satisfied all the conditions on its part to be performed or
satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Company's knowledge,
threatened; and
(iii) since the date of the most recent financial statements
included in the Final Prospectus (exclusive of any supplement
thereto), there has been no material adverse change in the condition
(financial or otherwise), prospects, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the Final Prospectus (exclusive
of any supplement thereto).
(f) At the Execution Time and at the Closing Date Ernst & Young
LLP shall have furnished to the Representatives letters dated as of the
Execution Time and the Closing Date in form and substance satisfactory to
the Representatives.
(g) Except as agreed to by Citigroup Global Markets Inc. and
Wachovia Capital Markets, LLC, subsequent to the Execution Time, there
shall not have been any decrease in the rating of any of the Company's
debt securities by any "nationally recognized statistical rating
organization" (as defined for purpose of Rule 436(g) under the Act) or any
notice given of any intended or potential decrease in any such rating or
of a possible change in any such rating that does not indicate the
direction of the possible change.
12
(h) Prior to the Closing Date the Company shall have furnished to
the Representatives such further information, certificates and documents
as the Representatives may reasonably request.
If any of the conditions specified in this Section 5 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representatives. Notice of such
cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
The documents required to be delivered by this Section 5 shall be
delivered at the office of Cravath, Swaine & Xxxxx LLP, counsel for the
Underwriters, at Worldwide Plaza, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, xx the
Closing Date.
6. Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 5 hereof is not satisfied,
because of any termination pursuant to Section 9 hereof (other than a
termination under Section 9(b) resulting from a default by an Underwriter as
provided in Section 8 hereof) or because of any refusal, inability or failure on
the part of the Company to perform any agreement herein or comply with any
provision hereof other than by reason of a default by any of the Underwriters,
the Company will reimburse the Underwriters severally through Citigroup Global
Markets Inc. on demand for all reasonable out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by
them in connection with the proposed purchase and sale of the Securities, but
the Company shall not be liable in any event to any of the Underwriters for
damages on account of loss of anticipated profits from the sale of the
Securities.
7. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement for the registration of
the Securities as originally filed or in any amendment thereof, or in the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus, or in any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
agrees to reimburse each such indemnified party, as reasonably incurred, for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that with respect to any untrue statement or omission of
material fact made in any Preliminary Final Prospectus, the indemnity agreement
contained in this Section 7(a) shall not inure to the benefit of any Underwriter
from whom the person asserting any such loss, claim, damage or liability
purchased the securities concerned, to the extent that any such loss, claim,
damage or liability of such Underwriter occurs under the circumstance where (w)
the Company had previously furnished copies of the Final Prospectus to the
Representatives, (x) delivery of the Final Prospectus was required by the Act to
be made to such person, (y) the untrue statement or
13
alleged untrue statement or omission or alleged omission of a material fact
contained in the Preliminary Final Prospectus was corrected in the Final
Prospectus and (z) there was not sent or given to such person, at or prior to
the written confirmation of the sale of such securities to such person, a copy
of the Final Prospectus. This indemnity agreement will be in addition to any
liability which the Company may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold
harmless the Company, each of its directors, each of its officers who
signs the Registration Statement, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, to the same
extent as the foregoing indemnity from the Company to each Underwriter,
but only with reference to written information relating to such
Underwriter furnished to the Company by or on behalf of such Underwriter
through the Representatives specifically for inclusion in the documents
referred to in the foregoing indemnity. This indemnity agreement will be
in addition to any liability which any Underwriter may otherwise have. The
Company acknowledges that the statements set forth under the heading
"Underwriting" in the fourth, seventh, eighth and ninth paragraphs (except
for the statement made by the Company in the third sentence of the ninth
paragraph, as such statement relates to the Company), and the second and
third sentences of the eleventh paragraph, in any Preliminary Final
Prospectus or the Final Prospectus, constitute the only information
furnished in writing by or on behalf of the several Underwriters for
inclusion in the documents referred to in the foregoing indemnity.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 7, notify the indemnifying party in
writing of the commencement thereof; but the failure so to notify the
indemnifying party (i) will not relieve it from liability under paragraph
(a) or (b) above unless and to the extent it did not otherwise learn of
such action and such failure results in the prejudice by the indemnifying
party of substantial rights and defenses and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a)
or (b) above. The indemnifying party shall be entitled to appoint counsel
of the indemnifying party's choice at the indemnifying party's expense to
represent the indemnified party in any action for which indemnification is
sought (in which case the indemnifying party shall not thereafter be
responsible for the fees and expenses of any separate counsel retained by
the indemnified party or parties except as set forth below); provided,
however, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party's election to
appoint counsel to represent the indemnified party in an action, the
indemnified parties shall have the right to employ one separate counsel
(and, if reasonably necessary, one additional local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel if (i) the use of counsel chosen by the indemnifying
party to represent the indemnified party would present such counsel with a
conflict of interest, (ii) the indemnifying party shall not have employed
counsel satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of the institution of such
action or, (iii) the indemnifying party shall authorize the indemnified
party to employ separate counsel at the expense of the indemnifying party.
An indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or
14
contribution may be sought hereunder (whether or not the indemnified
parties are actual or potential parties to such claim or action) unless
such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim,
action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or
(b) of this Section 7 is unavailable to or insufficient to hold harmless
an indemnified party for any reason, the Company and the Underwriters
agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in
connection with investigating or defending same) (collectively "Losses")
to which the Company and one or more of the Underwriters may be subject in
such proportion as is appropriate to reflect the relative benefits
received by the Company and by the Underwriters from the offering of the
Securities; provided, however, that in no case shall any Underwriter
(except as may be provided in any agreement among underwriters relating to
the offering of the Securities) be responsible for any amount in excess of
the underwriting discount or commission applicable to the Securities
purchased by such Underwriter hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Company
and the Underwriters shall contribute in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault of
the Company and of the Underwriters in connection with the statements or
omissions which resulted in such Losses as well as any other relevant
equitable considerations. Benefits received by the Company shall be deemed
to be equal to the total net proceeds from the offering (before deducting
expenses), and benefits received by the Underwriters shall be deemed to be
equal to the total underwriting discounts and commissions, in each case as
set forth on the cover page of the Final Prospectus. Relative fault shall
be determined by reference to, among other things, whether any untrue or
any alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information provided by the
Company on the one hand or the Underwriters on the other, the intent of
the parties and their relative knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The
Company and the Underwriters agree that it would not be just and equitable
if contribution were determined by pro rata allocation or any other method
of allocation which does not take account of the equitable considerations
referred to above. Notwithstanding the provisions of this paragraph (d),
no person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For
purposes of this Section 7, each person who controls an Underwriter within
the meaning of either the Act or the Exchange Act and each director,
officer, employee and agent of an Underwriter shall have the same rights
to contribution as such Underwriter, and each person who controls the
Company within the meaning of either the Act or the Exchange Act, each
officer of the Company who shall have signed the Registration Statement
and each director of the Company shall have the same rights to
contribution as the Company, subject in each case to the applicable terms
and conditions of this paragraph (d).
8. Default by an Underwriter. If any one or more Underwriters
shall fail to purchase and pay for any of the Securities agreed to be purchased
by such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay within 24 hours for (in the respective proportions which the amount of
Securities set forth opposite their names in Schedule II hereto bears to the
aggregate amount of
15
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
Schedule II hereto, the remaining Underwriters shall have the right to purchase
within 24 hours all, but shall not be under any obligation to purchase any, of
the Securities, and if such nondefaulting Underwriters do not purchase all the
Securities, this Agreement will terminate without liability to any nondefaulting
Underwriter or the Company. In the event of a default by any Underwriter as set
forth in this Section 8, the Closing Date shall be postponed for such period,
not exceeding five Business Days, as the Representatives shall determine in
order that the required changes in the Registration Statement and the Final
Prospectus or in any other documents or arrangements may be effected. Nothing
contained in this Agreement shall relieve any defaulting Underwriter of its
liability, if any, to the Company and any nondefaulting Underwriter for damages
occasioned by its default hereunder.
9. Termination. This Agreement may be terminated by you by notice
to the Company as follows:
(a) at any time after the Execution Time and prior to the Closing
Date if any of the following has occurred: (i) any material adverse change
or any development involving a prospective material adverse change in or
affecting the condition, financial or otherwise, of the Company and its
subsidiaries taken as a whole or the earnings, business affairs,
management or business prospects of the Company and its subsidiaries taken
as a whole, whether or not arising in the ordinary course of business,
(ii) any outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic or political
conditions, if the effect of such outbreak, escalation, calamity, crisis
or change on the financial markets of the United States would, in your
reasonable judgment, make the offering or delivery of the Securities
impracticable, (iii) suspension of trading in securities on the NYSE or
limitation on prices (other than limitations on hours or numbers of days
of trading) for securities on the NYSE, (iv) the enactment, publication,
decree or other promulgation of any federal or state statute, regulation,
rule or order of any court or other governmental authority which in your
reasonable opinion materially and adversely affects or will materially or
adversely affect the business or operations of the Company and its
subsidiaries taken as a whole, (v) declaration of a banking moratorium by
either federal or New York State authorities, (vi) a material disruption
in commercial banking or securities settlement or clearance services in
the United States, if the effect of such disruption is so material or
adverse that it makes the offering or delivery of the Securities on the
terms and in the manner contemplated in the Final Prospectus impraticable
or (vii) the taking of any action by any federal, state or local
government or agency in respect of its monetary or fiscal affairs which in
your reasonable opinion has a material adverse effect on the securities
markets in the United States; or
(b) as provided in Sections 5 and 8 of this Agreement.
10. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers, and of the Underwriters set forth in or made pursuant
to this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors or controlling persons referred to in Section 7 hereof,
and will
16
survive delivery of and payment for the Securities. The provisions of Sections 6
and 7 hereof shall survive the termination or cancelation of this Agreement.
11. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed
or delivered Citigroup Global Markets Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX
00000, attention: General Counsel or, if sent to the Company, will be mailed or
delivered to 000 Xxxx Xxxxx Xxxx, Xxx Xxxxxxx, Xxxxx, 00000 attention: Xxxxxxx
Xxxx, Executive Vice President.
12. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7 hereof, and no
other person will have any right or obligation hereunder. The term "successors"
shall not include any purchaser of the Securities merely because of such
purchase.
13. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York.
14. Counterparts. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
15. Headings. The Section headings used herein are for convenience
only and shall not affect the construction hereof.
16. Definitions. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended.
"Basic Prospectus" shall mean the prospectus referred to in
paragraph 1(a) above contained in the Registration Statement at the
Effective Date including any Preliminary Final Prospectus.
"Business Day" shall mean any day other than a Saturday, a Sunday or
a legal holiday or a day on which banking institutions or trust companies
are authorized or obligated by law to close in New York City or Dallas,
Texas.
"Commission" means the Securities and Exchange Commission.
"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto and any Rule
462(b) Registration Statement became or become effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
17
"Final Prospectus" shall mean the prospectus supplement relating to
the Securities that is first filed pursuant to Rule 424(b) after the
Execution Time together with the Basic Prospectus.
"Preliminary Final Prospectus" shall mean any preliminary prospectus
supplement to the Basic Prospectus which describes the Securities and the
offering thereof and is used prior to filing of the Final Prospectus.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at the
Execution Time, in the form in which it shall become effective) and, in
the event any post-effective amendment thereto or any Rule 462(b)
Registration Statement becomes effective prior to the Closing Date (as
hereinafter defined), shall also mean such registration statement as so
amended or such Rule 462(b) Registration Statement, as the case may be.
Such term shall include any Rule 430A Information deemed to be included
therein at the Effective Date as provided by Rule 430A.
"Rule 415", "Rule 424", "Rule 430A" and "Rule 462" refer to such
rules under the Act.
"Rule 430A Information" shall mean information with respect to the
Securities and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b)
relating to the offering covered by the initial registration statement.
"Rules and Regulations" means the rules and regulations of the
Commission.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as
amended.
18
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters.
Very truly yours,
Clear Channel Communications, Inc.,
By: /s/ XXXX X. XXXX
-------------------------------
Name: Xxxx X. Xxxx
Title: Interim Chief Executive Officer,
President and Chief Operating Officer
19
The foregoing Agreement is
hereby confirmed and accepted
as of the date specified in
Schedule I hereto.
CITIGROUP GLOBAL MARKETS INC.
By: /s/ XXXX XXXXXX
------------------------
Name: Xxxx Xxxxxx
Title: Managing Director
WACHOVIA CAPITAL MARKETS, LLC
By: /s/ XXXX XXXXX
-------------------------
Name: Xxxx Xxxxx
Title: Managing Director
For themselves and the other
several Underwriters, if any,
named in Schedule II to the
foregoing Agreement.
SCHEDULE I
Underwriting Agreement dated September 15, 2004
Registration Statement No. 333-111070
Representatives:
Citigroup Global Markets Inc.
Underwriters:
Citigroup Global Markets Inc. and Wachovia Capital Markets, LLC
Title, Purchase Price and Description of Securities:
Title: $750,000,000 of 5.5% Senior Notes due 2014 (the "notes")
Principal Amount of Securities: $750,000,000
Purchase Price (include accrued interest or amortization, if any):
$743,445,000 for the $750,000,000 aggregate principal amount of the notes.
Sinking fund provisions: None
Redemption provisions:
The notes are redeemable by the Company. The notes will be redeemable as a
whole at any time or in part from time to time, at the option of the Company, at
a redemption price equal to the greater of (i) 100% of the principal amount of
such notes being redeemed or (ii) the sum of the present values of the remaining
scheduled payments of principal and interest on the notes being redeemed from
the redemption date to September 15, 2014, discounted to the redemption date on
a semiannual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate (as defined below) plus 25 basis points, plus, in either
case, any interest accrued but not paid to the date of redemption. Notice of any
redemption will be mailed at least 30 days but no more than 60 days before the
redemption date to each holder of the notes to be redeemed. Unless the Company
defaults in payment of the redemption price, on and after the redemption date
interest will cease to accrue on the notes or portions thereof called for
redemption. The notes will not be subject to any sinking fund provision.
"Treasury Rate" means, with respect to any redemption date for the notes,
(i) the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published statistical
release designated "H.15(519)" or any successor publication which is published
weekly by the Board of Governors of the Federal Reserve System and which
establishes yields on actively traded United States Treasury securities adjusted
to constant maturity under the caption "Treasury Constant Maturities," for the
maturity corresponding to the Comparable Treasury Issue (if no maturity is
within three months before or after the maturity date, yields for the two
published maturities most closely corresponding to the
2
Comparable Treasury Issue shall be determined and the Treasury Rate shall be
interpolated or extrapolated from such yields on a straight line basis, rounding
to the nearest month), or (ii) if such release referred to in clause (i) (or any
successor release) is not published during the week preceding the calculation
date or does not contain the yields referred to above, the rate per year equal
to the semiannual equivalent yield maturity of the Comparable Treasury Issue,
calculated using a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date. The Treasury Rate shall be calculated on the third
Business Day preceding the redemption date.
"Comparable Treasury Issue" means the United States Treasury security
selected by an "Independent Investment Banker" as having a maturity comparable
to the remaining term of the notes to be redeemed that would be utilized, at the
time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of such notes.
"Independent Investment Banker" means, with respect to any redemption date
for the notes, Citigroup Global Markets Inc. and Wachovia Capital Markets, LLC
and their successors or, if both of such firms or successor to such firms, as
the case may be, are unwilling or unable to select the Comparable Treasury
Issue, an independent banking institution of national standing appointed by the
Trustee after consultation with the Company.
"Comparable Treasury Price" means, with respect to any redemption date for
the notes, (i) the average of four Reference Treasury Dealer Quotations (as
defined below) for the redemption date, after excluding the highest and lowest
such Reference Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer
than four such Reference Treasury Dealer Quotations, the average of all such
quotations obtained.
"Reference Treasury Dealer" means Citigroup Global Markets Inc. and
another primary U.S. Government securities dealer in New York City selected by
Wachovia Capital Markets, LLC, and two other primary U.S. Government securities
dealers in New York City (each, a "Primary Treasury Dealer") appointed by the
Trustee in consultation with the Company. If any of the foregoing shall cease to
be a Primary Treasury Dealer, the Company shall substitute therefor another
Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined by
the Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the
third Business Day preceding such redemption date.
Other provisions: None
Closing Date, Time and Location: September 20, 2004 at 10:00 a.m. at
Cravath, Swaine & Xxxxx LLP, Worldwide Plaza, 000 Xxxxxx Xxx., Xxx Xxxx,
XX 00000
Type of Offering: Non-delayed
Overallotment Option: None
SCHEDULE II
Principal Amount
Underwriters of Notes
------------ ----------------
Citigroup Global Markets Inc. $375,000,000
Wachovia Capital Markets, LLC 375,000,000
------------
Total $750,000,000
============
The Company has not granted the Underwriters an option to purchase any
additional principal amount of the above referenced securities.
