Exhibit 4.1
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of June 30, 1998 (the
"Agreement"), is made by and among Cumulus Media Inc., an Illinois corporation
(the "Company"), NationsBanc Capital Corp. ("NationsBanc"), ▇▇▇▇▇▇ Equity
Capital Corporation ("▇▇▇▇▇▇"), the State of Wisconsin Investment Board ("SWIB")
and The Northwestern Mutual Life Insurance Company ("NML"). Each of NationsBanc,
▇▇▇▇▇▇, SWIB and NML and their respective transferees (as provided in Section
7(f)) shall sometimes be referred to herein as a "Shareholder" and collectively
as the "Shareholders".
R E C I T A L S:
WHEREAS, the Shareholders and Cumulus Media, LLC, a Wisconsin limited
liability company ("Media LLC"), are parties to that certain Amended and
Restated Registration Rights Agreement dated as of November 14, 1997 (the "Media
LLC Registration Rights Agreement") pursuant to which Media LLC agreed to
provide the Shareholders with certain registration rights; and
WHEREAS, Media LLC currently holds all of the issued and outstanding
common stock of the Company; and
WHEREAS, Media LLC is to be dissolved and all of the shares of common
stock of the Company held by Media LLC are to be distributed to the Shareholders
in a liquidating distribution; and
WHEREAS, the Company intends to consummate an initial public offering
of its Class A Common Stock; and
WHEREAS, the Media LLC Registration Rights Agreement contemplates that
in the event of an initial public offering of equity securities by the Company,
the Company would enter into a registration rights agreement with the
Shareholders on terms similar to those set forth in the Media LLC Registration
Rights Agreement prior to the consummation of such initial public offering; and
WHEREAS, the Company and the Shareholders have agreed to enter into
this Registration Rights Agreement to set forth the registration rights to be
provided to the Shareholders by the Company.
NOW, THEREFORE, in consideration of the foregoing, and of the mutual
promises herein contained and of other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
1. Definitions. The following capitalized terms have the following
meanings:
Class A Common Stock: The Class A Common Stock, $.01 par value per
share, issued by the Company.
Class B Common Stock: The Class B Common Stock, $.01 par value per
share, issued by the Company.
Class C Common Stock: The Class C Common Stock, $.01 par value per
share, issued by the Company.
Commission: The United States Securities and Exchange Commission or any
other United States federal agency administering the Securities Act or the
Exchange Act.
Common Stock: Class A Common Stock and/or Class B Common Stock and/or
Class C Common Stock and any securities issued thereafter with respect to such
Common Stock by way of a stock dividend, stock split, or in connection with a
combination of shares, recapitalization, merger, share exchange, consolidation
or similar transaction.
Exchange Act: The United States Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder, as in
effect from time to time.
NASD: The National Association of Securities Dealers, Inc. and any
successor organization.
Person: An individual, corporation, partnership, limited liability
company, association, joint-stock company, trust where the interests of the
beneficiaries are evidenced by a security, unincorporated organization, estate,
governmental or political subdivision thereof or governmental agency.
Public Offering: The closing of an underwritten public offering of
Class A Common Stock, or securities convertible into or exchangeable or
exercisable for Class A Common Stock, registered with the Commission under the
Securities Act.
Registrable Securities: Shares of Class A Common Stock that (i) are
owned by any Shareholder immediately after the dissolution of Media LLC and any
securities issued thereafter with respect to such Class A Common Stock by way of
a stock dividend, stock split or in connection with a combination of shares,
recapitalization, merger, share exchange, consolidation or similar transaction,
or (ii) are issued to any Shareholder upon conversion of any Class B Common
Stock owned by such Shareholder immediately after the dissolution of Media LLC
(or upon conversion of any Class C Common Stock received by such Shareholder
upon conversion of any Class B Common Stock owned by such Shareholder
immediately after the dissolution of Media LLC), and any securities issued
thereafter with respect to such Class B Common Stock or Class C Common Stock by
way of a stock dividend, stock split or in connection with a combination of
shares, recapitalization, merger, share exchange, consolidation or similar
transaction.
Registration Statement: A registration statement provided for in
Section 6 of the Securities Act under which securities are registered under the
Securities Act, together with any preliminary, final or summary prospectus
contained therein, any amendment or supplement thereto, and any document
incorporated by reference therein.
Securities Act: The United States Securities Act of 1933, as amended,
and the rules and regulations of the Commission thereunder, all as the same
shall be in effect from time to time.
Terms defined in the Exchange Act or the Securities Act and not otherwise
defined herein have the meanings herein as therein defined.
2. Demand Registration.
(a) Right to Demand. After the date of the initial Public
Offering, or, if earlier, the date on which the Company first becomes subject to
the reporting obligations under Section 13(a) of the Exchange Act, the holders
of Registrable Securities shall have the right, exercisable by written notice to
the Company signed by (i) Person(s) holding more than 25% of the Registrable
Securities outstanding in the case of the first notice, (ii) in the case of the
second notice, Person(s) holding more than 25% of the Registrable Securities
outstanding, excluding Registrable Securities held by the Person(s) initiating
the first notice, and (iii) in the case of the third notice, Person(s) holding
more than 20% of the Registrable Securities, excluding Registrable Securities
held by Person(s) initiating the first or second notice, to request that the
Company effect the registration under the Securities Act of all or part of such
Person(s)' Registrable Securities (a "Demand Registration"); provided, however,
that excluding any Demand Registration under Section 2(d) hereof, the holders of
Registrable Securities shall only have the right to make three (3) requests for
a Demand Registration. Upon receipt of such notice, the Company shall, as
expeditiously as reasonably possible and in any event, within ten (10) days of
receipt of such notice, give written notice of such Demand Registration to all
registered holders of Registrable Securities, and shall use all commercially
reasonable efforts to effect all such registrations under the Securities Act
(including, without limitation, the execution of an undertaking to file
post-effective amendments and appropriate qualifications and approvals under the
laws and regulations of any governmental agencies and authorities applicable to
the Company, including the relevant blue sky or other state securities laws) of:
(i) the Registrable Securities that the Company has been requested to
register as specified in the demand given pursuant to this Section 2(a)
(including, without limitation, an offering on a delayed or continuous basis
pursuant to Rule 415 (or any successor rule to similar effect) under the
Securities Act); and
(ii) all other Registrable Securities that the Company has been
requested to register by the holders thereof, by written request given to the
Company within thirty (30) days after the giving of such written notice by the
Company,
all to the extent required to permit the disposition of the Registrable
Securities so to be registered.
(b) Selection of Underwriters. The underwriters of any
underwritten offering pursuant to a Demand Registration shall be selected by the
Company, subject, however, to the approval of the holders of Registrable
Securities participating in such Demand Registration, which approval shall not
be unreasonably withheld; provided, however, that the holders of the Registrable
Securities shall not be required to pursue an underwritten offering upon
exercise of the Demand Registration.
(c) Participation in Demand Registrations. If the managing
underwriter advises the Company in writing, with a copy to the Shareholders
that, in its opinion, the number of Registrable Securities requested to be
included in a Demand Registration exceeds what can be sold in such offering
without a material adverse effect on the offering, then the Company will advise
the Shareholders and will include in such Demand Registration up to the maximum
number of Registrable Securities requested to be included in such Demand
Registration which the managing underwriter advises the Company can be sold in
such offering and such Registrable Securities shall be allocated among the
holders of Registrable Securities who have requested to be included in such
Demand Registration, pro rata among such Persons on the basis of the number of
Registrable Securities requested to be included in such Registration. If any
holder of Registrable Securities disapproves of the number of reduced
Registrable Securities that can be included on behalf of such holder, he may
elect to withdraw therefrom by written notice to the Company, the underwriter
and the other Shareholders.
(d) Additional Demand Registrations.
(i) If the Company effects the registration of less than all of the
Registrable Securities requested to be included in a Demand Registration under
Subsection 2(a) solely as a result of the operation of Subsection 2(c), the
holders of such Registrable Securities may at any time request an additional
Demand Registration with respect to such Registrable Securities (which Demand
shall not count as the second or third Demand Right contemplated in Section
2(a)), provided that at least six (6) months have elapsed since the effective
date of the most recent Demand Registration. Any such Demand Registration shall
be requested and effected in the manner and subject to the procedures that
applied with respect to the Demand Registration which was the subject of the
cutback in Subsection 2(c).
(ii) If the no-action request being submitted by Media LLC to the
Commission results in a finding that NationsBanc is unable to "tack" the holding
period of Media LLC to its own holding period with respect to the shares of
Common Stock distributed to NationsBanc upon dissolution of Media LLC, then
NationsBanc shall have the right, exercisable by written notice to the Company
and in addition to any rights provided under Section 2(a) hereof, to request
that the Company effect the registration under the Securities Act of all or part
of the Registrable Securities held by NationsBanc; provided, however, that
NationsBanc shall only have the right to make one (1) request for an additional
Demand Registration under this Section 2(d)(ii). Upon receipt of such notice,
the Company shall, as expeditiously as reasonably possible and in any event
within ten (10) days of receipt of such notice, give written notice of such
additional Demand Registration to all other registered holders of Registrable
Securities, and shall use all commercially reasonable efforts to effect all such
registrations under the Securities Act (including, without limitation, the
execution of an undertaking to file post-effective amendments
and appropriate qualifications and approvals under the laws and regulations of
any governmental agencies and authorities applicable to the Company, including
the relevant blue sky or the state securities laws) of (x) the Registrable
Securities that the Company has been requested to register as specified in the
demand given by NationsBanc pursuant to this Section 2(d)(ii); and (y) all other
Registrable Securities that the Company has been requested to register by the
other holders of Registrable Securities, by written request given to the Company
within thirty (30) days after the giving of such written notice by the Company,
all to the extent required to permit the disposition of the Registrable
Securities so to be registered. The underwriters shall be selected in accordance
with Section 2(b). If the managing underwriter advises the Company in writing
that, in its opinion, the number of Registrable Securities requested to be
included in such additional Demand Registration exceeds what can be sold in such
offering without a material adverse effect on the offering, then the Company
will advise the Shareholders and will include in such Demand Registration up to
the maximum number of Registrable Securities requested to be included in such
Demand Registration which the managing underwriter advises the Company can be
sold at such offering and such Registrable Securities shall be allocated first
to NationsBanc to the extent set forth in its notice of Demand Registration and
second, among the holders of Registrable Securities other than NationsBanc who
have requested to be included in such Demand Registration, pro rata among such
persons on the basis of the number of Registrable Securities requested to be
included in such registration. If the no-action request submitted to the
Commission results in a finding that NationsBanc may tack the holding period of
Media LLC to its own holding period with respect to the shares of Company Common
Stock received upon dissolution of Media LLC, the provisions of this Section
2(d)(ii) shall be null and void and of no force or effect.
(e) Restrictions on Demand Registrations. The Company may
postpone for up to (but not exceeding) six (6) months the filing or the
effectiveness of a Registration Statement for a Demand Registration, whether
pursuant to Subsection 2(a) or 2(d), if the Company's Board of Directors
determines that such Demand Registration would reasonably be expected to have an
adverse effect on any proposal or plan by the Company or any of its subsidiaries
to engage in any acquisition of assets (other than in the ordinary course of
business) or any merger, consolidation, tender offer or similar transaction or
that the Demand Registration will adversely interfere with other Company events
or would require disclosure of material nonpublic information relating to the
Company which, in the reasonable opinion of the Board of Directors of the
Company, should not be disclosed; provided that (i) the Company may postpone the
filing or effectiveness of a Demand Registration Statement pursuant hereto not
more than once during any twelve consecutive month period, and (ii) the Company
may postpone or withdraw the filing or effectiveness of a Demand Registration
Statement pursuant hereto not more than twice during the term of this Agreement.
In addition, the Company shall not be required to comply with this Section 2
within one hundred eighty (180) days after the effective date of an initial
Public Offering or within ninety (90) days of another Registration Statement
subject to this Section 2 or Section 3. In any such event, the holders of
Registrable Securities requesting such Demand Registration will be entitled to
withdraw their request for the Demand Registration. If the request for the
Demand Registration is so withdrawn, such Demand Registration request shall not
count as a Demand Registration request hereunder; provided, however, that the
holders of Registrable Securities shall not be permitted to request another
Demand Registration until such postponement would have ended had the request not
been
withdrawn. The Company shall reimburse each holder of Registrable Securities for
all costs and expenses reasonably incurred by it in connection with a proposed
and withdrawn Demand Registration.
(f) Other Registration Rights. The Company shall not, without
the prior written consent of the holders of 75% of the then outstanding
Registrable Securities, grant to any Persons the right to request the Company to
register any equity securities of the Company, or any securities convertible or
exchangeable into or exercisable for such securities, if such rights could
reasonably be expected to conflict with or be in parity with, the registration
rights of the holders of Registrable Securities granted hereunder. The granting
by the Company of registration rights to a third party shall not be deemed to be
in conflict or parity with the registration rights of the holders of Registrable
Securities granted hereunder as long as the provisions of Section 3(c) hereof
are complied with at all times during which the piggyback registration rights
provided to the Shareholders under said Section 3 are in effect and have not
been terminated in accordance with Section 3(d) hereof.
(g) Effective Registration Statement. Before filing a
Registration Statement or any amendments or supplements thereto, the Company
will (i) furnish to the holders of Registrable Securities which are to be
included in such registration, copies of all such documents proposed to be
filed, which documents will be subject to the review of the holders and their
counsel (which review shall be conducted at the Company's expense except that in
no event shall the Company be required to pay the expenses of more than one
counsel for the holders of Registrable Securities), and (ii) give the holders of
the Registrable Securities to be included in such Registration Statement and
their representatives, at the Company's expense (except that in no event shall
the Company be required to pay the expenses of more than one counsel for the
holders of Registrable Securities), the opportunity to conduct a reasonable
investigation of the records and the business of the Company and to participate
in the preparation of any such Registration Statement or any amendments or
supplements thereto. With respect to any registrations requested pursuant to
Sections 2(a) or 2(d), the Company may include in such registration any other
equity securities of the Company, subject to the restrictions set forth in
Section 2(f). A Demand Registration pursuant to this Section 2 shall not be
deemed to have been effected (i) unless a Registration Statement with respect
thereto has become effective and the sale of Registrable Securities contemplated
thereby (if underwritten) has been consummated (unless not consummated for any
reason not due to any action or failure to act by the Company or because of a
material adverse change with respect to the Company), or (ii) if after it has
become effective, such Demand Registration is interfered with by any stop order,
injunction or other order or requirement of the Commission or other governmental
agency or court for any reason.
3. Piggyback Registration.
(a) Right to Piggyback. If the Company at any time proposes to
register any securities under the Securities Act (other than registrations on
Form S-4 or S-8 or the equivalent thereof) with respect to a Public Offering
(whether for its own account or for the account of other security holders) and
the form of Registration Statement to be used may be used for the registration
of Registrable Securities, the Company will give prompt written notice to all
holders
of Registrable Securities of its intent to do so and the proposed method of
distribution, which notice shall state whether such registration has been
initiated by the Company (a "Company Registration") or by another Person (a
"Third-Party Registration"). Within thirty (30) days after receipt of such
notice, any holder of Registrable Securities may by written notice to the
Company request the registration by the Company under the Securities Act of
Registrable Securities in connection with such proposed registration by the
Company under the Securities Act of securities (a "Piggyback Registration").
Such written notice to the Company shall specify the Registrable Securities
intended to be disposed of by such holders. Upon receipt of such request, the
Company will use all commercially reasonable efforts to register under the
Securities Act all Registrable Securities which the Company has been so
requested to register, to the extent requisite to permit the disposition of the
Registrable Securities so to be registered in accordance with the proposed
method of distribution; provided, however, that if at any time after giving
notice of its intent to register securities and before the effective date of the
Registration Statement filed in connection with such Piggyback Registration, the
Company determines for any reason not to register or to delay registration of
such securities, the Company may, at its election, give notice of such
determination to the holders of Registrable Securities requesting such Piggyback
Registration, and, thereupon, (i) in the case of a determination not to
register, the Company shall be relieved of its obligation to register any
Registrable Securities in connection with such Piggyback Registration (but not
from its obligation to pay registration expenses pursuant to Section 5 hereof)
without prejudice, however, to the rights of any holder(s) of Registrable
Securities entitled to do so to request that such registration be effected as a
Demand Registration under Section 2 hereof, and (ii) in the case of a
determination to delay registering, the Company may delay registering any
Registrable Securities for the same period as the delay in registering such
other securities. No registration effected under this Section 3 shall relieve
the Company of its obligation to effect any Demand Registration upon request
under Section 2 hereof.
(b) Selection of Underwriters. The underwriters, if any, of
any offering pursuant to a Piggyback Registration shall be one or more
nationally-recognized investment banking firms selected by the Company.
(c) Participation in Piggyback Registrations. If the managing
underwriter informs the Company in writing of its judgment that including the
Registrable Securities in the Piggyback Registration creates a substantial risk
that the proceeds or price per unit to be received from such offering might be
reduced or that the number of Registrable Securities to be registered is too
large to be reasonably sold, then the Company will include in such Piggyback
Registration, to the extent of the number which the Company is so advised can be
sold in such offering: first, all securities proposed by the Company to be sold
for its own account; second, such other securities (if any) proposed to be
included as a result of the exercise of demand registration rights by the
holders thereof; third, such Registrable Securities requested by the holders
thereof to be included in such Piggyback Registration, pro rata on the basis of
the number of shares of such Registrable Securities requested to be included in
such Registration Statement; and fourth, such other securities requested to be
included therein pro rata on the basis of the number of shares of such other
securities requested to be included in the Registration Statement.
(d) Termination of Piggyback Rights. The piggyback
registration rights provided to the Shareholders under this Section 3 shall
terminate as to any Shareholder at such time as such Shareholder is permitted to
dispose of all of its Registrable Securities in any six (6) month period under
Rule 144 of the Securities Act (including Rule 144(k)).
4. Registration Procedures.
(a) Company Covenants. Whenever the Company is hereunder
required to use all commercially reasonable efforts to effect the registration
under the Securities Act of any Registrable Securities as provided in Section 2
or 3, the Company will:
(i) prepare and file (in the case of a Demand Registration,
within forty-five (45) days of the initial notice from the requisite
holders of Registrable Securities) with the Commission the requisite
Registration Statement to effect such registration and thereafter use
all commercially reasonable efforts to cause such Registration
Statement to become effective, provided that the Company may
discontinue any registration of its securities which are not
Registrable Securities (and, under the circumstances specified in
Subsection 3(a), its securities which are Registrable Securities) at
any time prior to the effective date of the Registration Statement
relating thereto;
(ii) prepare and file with the Commission such amendments and
supplements to such Registration Statement and the prospectus used in
connection therewith as may be necessary to comply with the provisions
of the Securities Act with respect to the disposition of all securities
covered by such Registration Statement until the earlier of (a) such
time as all such securities have been disposed of in accordance with
the intended methods of disposition by the sellers thereof set forth in
such Registration Statement and (b) the expiration of one hundred
eighty (180) days from the date such Registration Statement first
becomes effective (exclusive of any period during which the holders of
Registrable Securities are prohibited or impaired from disposition of
Registrable Securities by reason of the occurrence of any event
described in Section 4(a)(v)(a) or (b) or 4(a) (vii)), at which time
the Company shall have the right to deregister any of such securities
which remain unsold;
(iii) furnish to each seller of Registrable Securities covered
by such Registration Statement such number of conformed copies of the
Registration Statement, and of each amendment and supplement thereto,
such number of copies of the prospectus contained in such Registration
Statement and any other prospectus filed under Rule 424 under the
Securities Act, in conformity with the requirements of the Securities
Act, and such other documents as such seller may reasonably request;
(iv) use all commercially reasonable efforts to register or
qualify all securities covered by such Registration Statement under
such other securities or blue sky laws of jurisdictions as each seller
thereof shall reasonably request, to keep such registration or
qualification in effect for so long as the Registration Statement
remains in effect, and to take any other action which may be reasonably
necessary or advisable to enable such seller to consummate the
disposition in such jurisdictions of the securities owned by such
seller, except that the Company shall not for any such purpose be
required to (a) qualify generally to do business as a foreign
corporation in any jurisdiction wherein it would not be obligated to be
so qualified but for the requirements of this subsection; (b) subject
itself to taxation in any such jurisdiction; or (c) consent to general
service of process in any such jurisdiction;
(v) use all commercially reasonable efforts to (a) obtain the
withdrawal of any order suspending the effectiveness of such
Registration Statement or sales thereunder at the earliest possible
time and (b) cause all Registrable Securities covered by such
Registration Statement to be registered with or approved by such other
governmental agencies or authorities of United States jurisdictions as
may be necessary to enable the seller thereof to consummate the
disposition of such Registrable Securities;
(vi) in connection with any registration pursuant to this
Agreement, furnish to each seller of Registrable Securities a signed
counterpart, addressed to such seller and the underwriters, of:
(a) an opinion of counsel for the Company dated the
effective date of the Registration Statement (and dated the
closing date under any underwriting agreement), reasonably
satisfactory in form and substance to such seller, and
(b) a "comfort letter" or a "procedures letter" dated
the effective date of the Registration Statement (and dated
the date of the closing under any underwriting agreement),
signed by the independent public accountants who have audited
the Company's financial statements included in such
Registration Statement,
covering substantially the same matters with respect to such Registration
Statement and, in the case of the "comfort letter," with respect to events
subsequent to the date of such financial statements, as are customarily covered
in opinions of issuer's counsel and in accountants' letters delivered to the
underwriters in underwritten public offerings of securities, and, in the case of
the legal opinion, such other legal matters, and, in the case of the "comfort
letter," such other financial matters, as such seller or the underwriter may
reasonably request;
(vii) at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, notify each seller
of Registrable Securities covered by such Registration Statement
promptly after the Company discovers that the prospectus included in
such Registration Statement as then in effect includes an untrue
statement of a material fact or omits to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were
made, and at the request of any such seller promptly prepare and
furnish to such seller a reasonable number of copies of a supplement to
or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such securities, such
prospectus shall not include 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 in the light of
the circumstances under which they were made;
(viii) otherwise use all commercially reasonable efforts to
comply with all applicable rules and regulations of the Commission;
(ix) provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by such Registration
Statement from and after a date not later than the effective date of
such Registration Statement;
(x) use all commercially reasonable efforts to list all
Registrable Securities covered by such Registration Statement on a
securities exchange on which similar securities issued by the Company
are then listed and shall take any other action necessary or advisable
to facilitate the disposition of such Registrable Securities;
(xi) use all commercially reasonable efforts to facilitate
timely preparation and delivery (under regular-way settlement
procedures) of certificates representing Registrable Securities to be
sold free of restrictions; and
(xii) take all steps reasonably necessary to assure compliance
with any applicable provisions of the Investment Company Act of 1940,
as amended, including, but not limited to, registration of the Company,
or the election on behalf of the Company to be regulated as a business
development company, under that Act.
The Company may require each seller of Registrable Securities as to which any
registration is being effected to furnish the Company such information regarding
such seller and the distribution of such securities (which, in the case of a
non-underwritten offering, may include sales under Rule 144 under the Securities
Act) as the Company may reasonably request, in writing. Any Person participating
in any Demand Registration or Piggyback Registration must (a) agree to sell
their Registrable Securities on the basis provided in the underwriting
agreement, if any, and (b) complete and execute all documents required under
this Agreement or the underwriting agreement, if any.
Each holder of Registrable Securities agrees that upon receipt of any notice
from the Company of the happening of any event of the kind described in
subparagraph (vii) of this Subsection 4(a), such holder will discontinue
immediately such holder's disposition of securities pursuant to the Registration
Statement until such holder receives copies of the supplemented or amended
prospectus contemplated by such subparagraph (vii) and, if so directed by the
Company, will deliver to the Company all copies, other than permanent file
copies, then in such holder's possession of the prospectus relating to such
Registrable Securities current at the time of receipt of such notice.
(b) Underwriting Agreements. The Company will enter into an
underwriting agreement with the underwriters for any underwritten offering
pursuant to a Demand Registration or Piggyback Registration if requested by the
holders of Registrable Securities and the underwriters to do so. The
underwriting agreement will contain such representations and warranties by the
Company and such other terms as are generally prevailing at such time in
underwriting agreements. The holders of Registrable Securities to be distributed
by the
underwriters shall be parties to such underwriting agreement and may, at their
option, require that any or all of the representations, warranties, and other
agreements by the Company to and for the benefit of the underwriters also be
made to and for the benefit of such holders of Registrable Securities and that
any or all of the conditions precedent to the obligations of such underwriters
under such underwriting agreement be conditions precedent to the obligations of
such holders of Registrable Securities. No holder of Registrable Securities
shall be required to make representations or warranties to, or agreements with,
the Company or the underwriters other than representations, warranties or
agreements regarding such holder, such holder's Registrable Securities, such
holder's intended method of distribution and any representations required by
law.
(c) Holdback Agreement. Each holder of Registrable Securities
agrees by acquisition of such holder's Common Stock not to effect any public
sale or distribution of any Registrable Securities during the thirty (30) days
prior to and the one hundred eighty (180) days after the initial Public Offering
or ninety (90) days after any other underwritten (firm commitment or best
efforts) Public Offering, Demand Registration or Piggyback Registration has
become effective, except as part of such Public Offering, Demand Registration or
Piggyback Registration, as the case may be, unless the managing underwriter of
the Public Offering, Demand Registration or Piggyback Registration otherwise
agrees to such sale or distribution. Notwithstanding the foregoing, it is
acknowledged and agreed that the immediately preceding sentence shall not
prohibit ▇▇▇▇▇▇ or NML from effecting any public sale or distribution of any
Registrable Securities during the one hundred eighty (180) day period after the
initial Public Offering.
(d) Preparation; Reasonable Investigation. In connection with
the preparation and filing of each Registration Statement under the Securities
Act pursuant to this Agreement, the Company will give the holders of Registrable
Securities to be registered under such Registration Statement, the underwriters,
if any, and their respective counsel and accountants, the opportunity to
participate in preparing the Registration Statement. The Company will also give
each of such Persons such access to its books and records and opportunities to
discuss the business of the Company with the Company's officers and independent
public accountants who have certified the Company's financial statements as
shall, in the opinion of such holders' and such underwriters' respective
counsel, be necessary to conduct a reasonable investigation within the meaning
of the Securities Act.
(e) Rule 144. From and after the date of the initial Public
Offering, the Company will file the reports required to be filed by it under the
Securities Act and the Exchange Act to enable the holders thereof to sell their
Registrable Securities without registration under the Securities Act and within
the exemptions provided under the Securities Act by Rule 144 or any similar rule
or regulation hereafter adopted by the Commission. Upon the request of any
holder of Registrable Securities, the Company will deliver to such holder a
written statement as to whether it has complied with such requirements.
5. Registration Expenses. The Company will bear all expenses incident
to the Company's performance of or compliance with this Agreement, including,
without limitation, all registration, filing, qualifying and NASD fees, all
securities and blue sky compliance fees and
expenses (including related legal fees and disbursements and other expenses
pertaining thereto), all word processing expenses, duplicating expenses,
printing expenses, engraving expenses, messenger and delivery expenses, all
Company general and administrative expenses, all Company counsel and accountants
fees and disbursements, all special audit, financial statement and
reconstruction costs, all comfort letter costs, the reasonable fees and
disbursements of one counsel acting on behalf of the sellers of the Registrable
Securities being registered, all underwriter fees and disbursements customarily
paid by issuers or sellers of securities (including fees paid to a "qualified
independent underwriter" required by the rules of the NASD in connection with a
distribution), all "road show" expenses and allocations and the expense for
other Persons retained by the Company, but excluding discounts, commissions or
fees of underwriters, selling brokers, dealer managers, sales agents or similar
securities industry professionals relating to the distribution of Registrable
Securities and applicable transfer taxes, if any, and fees for more than one
special counsel to the sellers of Registrable Securities, which shall be borne
by the sellers of the Registrable Securities being registered on a pro rata
basis based on the number of Registrable Securities sold by each of them or upon
such other basis upon which such sellers may mutually agree.
6. Indemnification.
(a) Indemnification by the Company. In the event of any Demand
Registration or Piggyback Registration of any Registrable Securities under the
Securities Act, the Company shall, and hereby does, indemnify and hold harmless
each seller of any Registrable Securities covered by the Registration Statement
with respect thereto, such seller's partners, directors, trustees, officers,
advisors, employees and agents, and each Person who controls or is controlled by
such seller within the meaning of the Securities Act, against any losses,
claims, damages or liabilities to which such seller, partner, director, officer,
or controlling Person, as the case may be, may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings, whether commenced or threatened, in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of material fact contained in the Registration Statement under
which such Registrable Securities were sold (including all documents
incorporated therein by reference) as originally filed or in any amendment
thereto, any preliminary or final prospectus contained therein or any amendments
or supplements thereto, or an omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or a violation by the Company of any rule or regulation
promulgated pursuant to any federal, state or common law rule, including,
without limitation, the Securities Act, applicable to the Company and relating
to any action or inaction required of the Company in connection with such
registration, qualification or compliance, and the Company will reimburse each
such indemnified Person for expenses reasonably incurred by it in connection
with investigating or defending any such loss, claim, damage, liability, action
or proceeding; provided that the Company shall not be liable in any such case
for any losses, claims, damages, liabilities (or actions or proceedings in
respect thereof) or expenses which arise out of or are based upon an untrue
statement or alleged untrue statement or omission or alleged omission made by
the Company in such Registration Statement in reliance upon and in strict
conformity with information furnished to the Company by such Person through an
instrument duly executed by such Person specifically stating that it is for use
in the preparation thereof. This indemnity shall
remain in full force and effect regardless of any investigation made by or on
behalf of an indemnified party, and shall survive the transfer of such
Registrable Securities by the seller thereof.
(b) Indemnification by the Sellers. The Company may require,
as a condition to including any Registrable Securities in any Registration
Statement, that the Company receive an undertaking satisfactory to it from the
prospective seller of such Registrable Securities, to indemnify and hold
harmless (in the same manner and to the same extent as set forth in subsection
(a) of this Section 6) the Company, its directors, its officers, and each other
Person who controls the Company within the meaning of the Securities Act, with
respect to any statement or alleged statement in or omission or alleged omission
from such Registration Statement, if such statement or alleged statement or
omission or alleged omission was made in reliance upon and in conformity with
written information furnished to the Company through an instrument duly executed
by such seller specifically stating that it is for use in the preparation of
such Registration Statement. The prospective sellers' obligation to indemnify
will be several, not joint and several, among such sellers and the liability of
each such seller of Registrable Securities shall be in proportion to the net
amount received by such seller from the sale of Registrable Securities pursuant
to such Registration Statement. Notwithstanding the foregoing, the liability of
any such seller shall not exceed an amount equal to the proceeds realized by
each such seller from the sale of Registrable Securities pursuant to such
Registration Statement. This indemnity shall remain in full force and effect,
regardless of any investigation made by or on behalf of the Company, its
directors, officers or controlling Persons, and shall survive the transfer of
such Registrable Securities by the seller thereof.
(c) Notices of Claims, Etc. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a claim referred to in Subsection 6(a) or (b), such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party,
give written notice to such indemnifying party of the commencement of such
action. The failure of any indemnified party to give notice as provided herein
shall not relieve the indemnifying party of its obligations under the preceding
subdivisions of this Section 6, except to the extent that the indemnifying party
is materially prejudiced by the failure to give such notice. In case any such
action is brought against an indemnified party, the indemnifying party shall be
entitled to participate in and to assume the defense thereof, jointly with any
other indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to the indemnified party, unless a conflict of
interest exists between such indemnified and indemnifying parties that would
make representation by the same counsel inappropriate in the circumstances.
After notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable for any settlement made by the indemnified party without its consent
(which consent will not be unreasonably withheld or delayed) or for any legal or
other expenses subsequently incurred by the indemnified party in connection with
the defense thereof other than reasonable costs of investigation and the legal
expenses (if allowed under the previous sentence). No indemnifying party shall,
without the consent of the indemnified party, consent to entry of any judgment
or enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such indemnified party of a
release from all
liability in respect to such claim or litigation or imposes action or limitation
on action on such indemnified party.
(d) Indemnification Payments. The indemnification required by
this Section 6 shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred upon submission of reasonably
sufficient documentation that such expenses have been incurred.
(e) Contribution. If the indemnification provided for in this
Agreement shall for any reason be unavailable to or insufficient to hold
harmless an indemnified party in respect of any loss, claim, damage, expense or
liability, or any action in respect thereof, referred to herein, then the
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, in such
proportion as is appropriate to reflect the relative fault of the Company and
the Shareholders, respectively, with respect to the statements or omissions
which resulted in such loss, claim, damage, expense or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative fault of each party shall be determined by reference to whether the
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Company
or the Shareholder, the interest of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Shareholders agree that it would not be just and
equitable if contributions pursuant to this Agreement were to be determined by
pro rata allocation or by any other method of allocation which does not take
into account the equitable considerations referred to herein. The amount paid or
payable by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this Agreement
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions herein, a Shareholder shall not
be required to contribute any amount in excess of the amount by which the
proceeds received by the Shareholder from the sale of the Registrable Securities
pursuant to the Registration Statement exceeds the amount of any damage which
such Shareholder has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act or the Exchange Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
7. Miscellaneous.
(a) Effectiveness. This Agreement shall become effective only
upon the distribution by Media LLC of all shares of Common Stock of the Company
held by it to the shareholders and the other members of Media LLC as and to the
extent provided in the Agreement Regarding Dissolution dated as of June 30, 1998
among Cumulus Media, LLC, the Shareholders, QUAESTUS Management Corporation,
DBBC of Georgia, LLC, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇. If, for any reason,
such dissolution has not occurred on or before July 15, 1998, this Agreement
shall be null and void and of no force or effect. Upon this Agreement
becoming effective, the Media LLC Registration Rights Agreement shall be deemed
terminated and of no further force or effect.
(b) Initial Public Offering. Subject to the terms and
provisions of the Operating Agreement, nothing in this Agreement shall otherwise
create any obligation on the part of the Company to effect an initial Public
Offering.
(c) Amendments and Waivers. This Agreement may be amended or
waived by the consent of the Company and each of the Shareholders. Each holder
of any Registrable Securities at the time or thereafter outstanding shall be
bound by any consent authorized by this Subsection 7(c), whether or not such
Registrable Securities shall have been marked to indicate such consent.
(d) Nominees for Beneficial Owners. If Registrable Securities
are held by a nominee for the beneficial owner thereof, the beneficial owner
thereof may, at its election, be treated as the holder of such Registrable
Securities for purposes of (i) any action by holders of Registrable Securities
pursuant to this Agreement and (ii) any determination of number of Registrable
Securities held by any holders of Registrable Securities contemplated by this
Agreement. If the beneficial owner of any Registrable Securities so elects, the
Company may require assurances of such beneficial owner's ownership of such
Registrable Securities.
(e) Notices. Any consent, notice or other communication
provided for hereunder shall be in writing and shall be deemed given or made:
(i) when delivered in person; (ii) one (1) business day after delivered via
reputable overnight courier service or guaranteed next day service; or (iii)
upon confirmation of delivery when sent by facsimile transmission to a Person at
the address or facsimile number as shown in the records of the Company. The
following shall be prima facie evidence of the giving or making of any notice in
accordance with the provisions of this Section 7(e): (i) in the case of personal
delivery, an affidavit, executed by the person effecting personal delivery, of
the giving or making of such notice; (ii) in the case of a courier service, a
certificate of delivery by the courier service; and (iii) in the case of a
facsimile transmission, an electronically generated written confirmation of the
successful transmission thereof. Any notice to be given or made to any
Shareholder shall be deemed conclusively to have been given or made, and the
obligation to give such notice or report shall be deemed conclusively to have
been fully satisfied, upon sending of such notice to the Shareholder at his
address or facsimile number shown in the records of the Company. If any notice
to a Person at the address of such Person appearing in the books and records of
the Company is returned by the United States Postal Service or overnight courier
service marked to indicate that the United States Postal Service or overnight
courier service has been unable to deliver it, such notice and any subsequent
notices, shall be deemed to have been duly given or made without further mailing
(until such time as such person notifies the Company of a change in his address)
if they are available for the Person at the principal office of the Company for
a period of one (1) year from the date of the giving or making of such notice.
(f) Assignment. This Agreement is personal to the parties
hereto and not assignable and may not be enforced by any subsequent holder of
securities of the Company; provided, however, that upon execution and delivery
to the Company of a commitment to be
bound by the terms of this Agreement, this Agreement may be assigned to, and may
be enforced by, a transferee of Registrable Securities, which transferee shall
thereupon have all of the rights and obligations of its transferor hereunder.
(g) Descriptive Headings. The descriptive headings of the
sections and paragraphs of this Agreement are for reference only and shall not
limit or otherwise affect the meaning hereof.
(h) Governing Law. The rights and duties of the parties hereto
under this Agreement shall be governed by the law of the State of Wisconsin.
(i) Specific Performance. The parties hereto acknowledge that
there may be no adequate remedy at law if any party fails to perform any of its
obligations hereunder, and accordingly agree that each party, in addition to any
other remedy to which it may be entitled at law or in equity, shall be entitled
to compel specific performance of the obligations of any other party under this
Agreement in accordance with the terms and conditions of this Agreement, in any
court of the United States or any state thereof having jurisdiction.
(j) Counterparts. This Agreement may be executed in any number
of counterparts. Each counterpart is an original, but all counterparts shall
together constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
CUMULUS MEDIA INC.
By: /s/
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Executive Chairman
THE STATE OF WISCONSIN INVESTMENT BOARD
By: /s/
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▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, Portfolio Manager
NATIONSBANC CAPITAL CORP.
By: /s/
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ III, Senior Vice President
▇▇▇▇▇▇ EQUITY CAPITAL CORPORATION
By: /s/
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THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
By: /s/
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