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Appreciation Notes Registration Rights Agreement

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Sectors: Media
Governing Law: New York, View New York State Laws
Effective Date: December 30, 1997
Related Agreement Types:
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APPRECIATION NOTES REGISTRATION RIGHTS AGREEMENT

Dated as of December 30, 1997

by and among

BRILL MEDIA COMPANY, LLC,

BRILL MEDIA MANAGEMENT, INC.,

THE SUBSIDIARY GUARANTORS
named herein

and

NATWEST CAPITAL MARKETS LIMITED


as Initial Purchaser


------------------------------------------------
------------------------------------------------


$3,000,000 Aggregate Principal Amount of

APPRECIATION NOTES DUE 2007


TABLE OF CONTENTS


1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2. Exchange Offer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5


3. Shelf Registration. . . . . . . . . . . . . . . . . . . . . . . . . . . 9


4. Additional Interest . . . . . . . . . . . . . . . . . . . . . . . . . . 10


5. Registration Procedures . . . . . . . . . . . . . . . . . . . . . . . . 12


6. Registration Expenses . . . . . . . . . . . . . . . . . . . . . . . . . 21


7. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 8. Rules 144 and 144A. . . . . . . . . . . . . . . . . . . . . . . . . . . 27 9. Underwritten Registrations. . . . . . . . . . . . . . . . . . . . . . . 27


10. Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
(a) No Inconsistent Agreements . . . . . . . . . . . . . . . . . . . . 27
(b) Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . 27
(c) Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
(d) Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . 29
(e) Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
(f) Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
(g) Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . 29
(h) Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
(i) Notes Held by the Issuers or their Affiliates. . . . . . . . . . . 30
(j) Third Party Beneficiaries. . . . . . . . . . . . . . . . . . . . . 30


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APPRECIATION NOTES REGISTRATION RIGHTS AGREEMENT


This Appreciation Notes Registration Rights Agreement (the "Agreement") is dated as of December 30, 1997, by and among Brill Media Company, LLC, a Virginia limited liability company ("BMC"), Brill Media Management, Inc., a Virginia corporation ("Media" and, collectively with BMC, the "Company"), the subsidiary guarantors of the Company's obligations hereunder as listed on Schedule A hereto (collectively, the "Guarantors"), and NatWest Capital Markets Limited (the "Initial Purchaser").


This Agreement is entered into in connection with the Purchase Agreement, dated December 22, 1997, among the Company, the Guarantors and the Initial Purchaser (the "Purchase Agreement"), which provides, among other things, for the sale by the Company to the Initial Purchaser of $3,000,000 aggregate principal amount of the Company's Appreciation Notes due 2007 (the "Appreciation Notes"), which Appreciation Notes will be guaranteed by the Guarantors. The Company and the Guarantors are collectively referred to herein as the "Issuers." In order to induce the Initial Purchaser to enter into the Purchase Agreement, the Issuers have agreed to provide the registration rights set forth in this Agreement for the benefit of the Initial Purchaser and its direct and indirect transferees. The execution and delivery of this Agreement is a condition to the obligation of the Initial Purchaser to purchase the Appreciation Notes under the Purchase Agreement.


The parties hereby agree as follows:


1. Definitions


As used in this Agreement, the following terms shall have the following meanings:


Additional Interest: Has the meaning provided in Section 4(a) hereof.


Advice: Has the meaning provided in the last paragraph of Section 5 hereof.


Agreement: Has the meaning provided in the first introductory paragraph hereto.


Applicable Period: Has the meaning provided in Section 2(b) hereof.


Appreciation Exchange Notes: Has the meaning provided in Section 2(a) hereof.


Appreciation Notes: Has the meaning provided in the second introductory paragraph hereto.


Appreciation Notes Indenture: The Indenture, dated as of December 30, 1997 between the Company, the Guarantors and United States Trust Company of New York, as trustee, pursuant to which the Appreciation Notes are being issued, as amended or supplemented from time to time in accordance with the terms thereof.


Closing Date: Has the meaning provided in the Purchase Agreement.


Company: Has the meaning provided in the first introductory paragraph hereto.


Effectiveness Date: The 90th day after the Filing Date.


Effectiveness Period: Has the meaning provided in Section 3(a) hereof.


Event Date: Has the meaning provided in Section 4(b) hereof.


Exchange Act: The Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.


Exchange Offer: Has the meaning provided in Section 2(a) hereof.


Exchange Registration Statement: Has the meaning provided in Section 2(a) hereof.


Filing Date: The 60th day after the Issue Date.


Guarantors: Has the meaning provided in the first introductory paragraph hereto.


Holder: Any holder of a Registrable Note or Registrable Notes.


Indemnified Person: Has the meaning provided in Section 7(c) hereof.


Indemnifying Person: Has the meaning provided in Section 7(c) hereof.


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Indenture: The Indenture, dated as of December 30, 1997 between the Company, the Guarantors and United States Trust Company of New York, as trustee, pursuant to which $105,00,000 aggregate principal amount of the Company's 12% Senior Notes due 2007 are being issued, as amended or supplemented from time to time in accordance with the terms thereof.


Initial Purchaser: Has the meaning provided in the first introductory paragraph hereto.


Inspectors: Has the meaning provided in Section 5(o) hereof.


Issue Date: The date on which the original Appreciation Notes were sold to the Initial Purchaser pursuant to the Purchase Agreement.


Issuers: Has the meaning provided in the second introductory paragraph hereto.


NASD: Has the meaning provided in Section 5(s) hereof.


Participant: Has the meaning provided in Section 7(a) hereof.


Participating Broker-Dealer: Has the meaning provided in Section 2(b) hereof.


Persons: An individual, trustee, corporation, partnership, limited liability company, joint stock company, trust, unincorporated association, union, business association, firm or other legal entity.


Private Exchange: Has the meaning provided in Section 2(b) hereof.


Private Appreciation Exchange Notes: Has the meaning provided in Section 2(b) hereof.


Prospectus: The prospectus included in any Registration Statement (including, without limitation, any prospectus subject to completion and a prospectus that includes any information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated under the Securities Act), as amended or supplemented by any prospectus supplement, and all other amendments and supplements to the Prospectus, with respect to the terms of the offering of any portion of the Registrable Notes covered by such Registration Statement including post-effective


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amendments, and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus.


Purchase Agreement: Has the meaning provided in the second introductory paragraph hereto.


Records: Has the meaning provided in Section 5(o) hereof.


Registrable Notes: Each Appreciation Note upon original issuance of the Appreciation Notes and at all times subsequent thereto and each Private Appreciation Exchange Note upon original issuance thereof and at all times subsequent thereto, until in the case of any such Appreciation Note or Private Appreciation Exchange Note, as the case may be, the earliest to occur of (i) a Registration Statement covering such Appreciation Note or Private Appreciation Exchange Note, as the case may be, has been declared effective by the SEC and such Appreciation Note (unless such Appreciation Note was not tendered for exchange by the Holder thereof), or Private Appreciation Exchange Note, as the case may be, has been disposed of in accordance with such effective Registration Statement, (ii) such Appreciation Note or Private Appreciation Exchange Note, as the case may be, is, or may be, sold in compliance with Rule 144, or (iii) such Appreciation Note or Private Appreciation Exchange Note, as the case may be, ceases to be outstanding for purposes of the Indenture.


Registration Statement: Any registration statement of the Company, including, but not limited to, the Exchange Registration Statement, that covers any of the Registrable Notes pursuant to the provisions of this Agreement, including the Prospectus, amendments and supplements to such registration statement, including post-effective amendments, all exhibits, and all material incorporated by reference or deemed to be incorporated by reference in such registration statement.


Rule 144: Rule 144 promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule (other than Rule 144A) or regulation hereafter adopted by the SEC providing for offers and sales of securities made in compliance therewith resulting in offers and sales by subsequent holders that are not affiliates of an issuer of such securities being free of the registration and prospectus delivery requirements of the Securities Act.


Rule 144A: Rule 144A promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule (other than Rule 144) or regulation hereafter adopted by the SEC.


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Rule 415: Rule 415 promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC.


SEC: The Securities and Exchange Commission.


Securities Act: The Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder.


Shelf Notice: Has the meaning provided in Section 2(c) hereof.


Shelf Registration: Has the meaning provided in Section 3(a) hereof.


Shelf Registration Statement: shall mean a "shelf" registration statement of the Company and the Guarantors which covers all of the Registrable Notes on an appropriate form under Rule 415 under the 1933 Act, or any similar rule that may be adopted by the SEC, and all amendments and supplements to such registration statement, including post-effective amendments, in each case including the Prospectus contained therein, all exhibits thereto and all material incorporated by reference therein.


TIA: The Trust Indenture Act of 1939, as amended.


Trustee(s): The trustee under the Indenture and, if existent, the trustee under any indenture governing the Exchange Notes and Private Exchange Notes (if any).


Underwritten registration or underwritten offering: A registration in which securities of one or more of the Issuers are sold to an underwriter for reoffering to the public.


2. Exchange Offer


(a) Each of the Issuers agrees to file with the SEC no later than the Filing Date an offer to exchange (the "Exchange Offer") any and all of the Appreciation Notes for a like aggregate principal amount of debt securities of the Company, guaranteed by the Guarantors, which are identical in all material respects to the Appreciation Notes (the "Appreciation Exchange Notes") (and which are entitled to the benefits of the Appreciation Notes Indenture or a trust indenture that is identical in all material respects to the Appreciation Notes Indenture (other than such changes to the Appreciation Notes Indenture or any such identical trust indenture as are necessary to comply with any requirements of the SEC to effect or maintain the qualification thereof under the TIA) and


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which, in either case, has been qualified under the TIA), except that (i) the Appreciation Exchange Notes shall have been registered pursuant to an effective Registration Statement under the Securities Act and shall contain no restrictive legend thereon and (ii) the Appreciation Exchange Notes shall not be entitled to any further registration rights hereunder or to any Additional Interest. The Exchange Offer shall be registered under the Securities Act on the appropriate form (the "Exchange Registration Statement") and shall comply with all applicable tender offer rules and regulations under the Exchange Act. The Issuers agree to use their reasonable best efforts to (x) cause the Exchange Registration Statement to be declared effective under the Securities Act no later than the 90th day after the Filing Date; (y) keep the Exchange Offer open for at least 20 business days (or longer if required by applicable law) after the date that notice of the Exchange Offer is mailed to the Holders; and (z) consummate the Exchange Offer on or prior to the 120th day following the Filing Date. If after such Exchange Registration Statement is declared effective by the SEC, the Exchange Offer or the issuance of the Appreciation Exchange Notes thereunder is interfered with by any stop order, injunction or other order or requirement of the SEC or any other governmental agency or court, such Exchange Registration Statement shall be deemed not to have become effective for purposes of this Agreement until such stop order, injunction or other order or requirement is no longer in effect. Each Holder who participates in the Exchange Offer will be required to represent that any Appreciation Exchange Notes received by it will be acquired in the ordinary course of its business, that at the time of the consummation of the Exchange Offer such Holder will have no arrangement or understanding with any Person to participate in the distribution of the Appreciation Exchange Notes in violation of the provisions of the Securities Act, that such Holder is not an "affiliate" of any of the Issuers within the meaning of the Securities Act and that such Holder is not acting on behalf of any person who could not truthfully make the foregoing representations. Upon consummation of the Exchange Offer in accordance with this Section 2, the Issuers shall have no further obligation to register Registrable Notes (other than Private Appreciation Exchange Notes pursuant to Section 3 hereof). No securities other than the Appreciation Exchange Notes shall be included in the Exchange Registration Statement.


(b) The Issuers shall include within the Prospectus contained in the Exchange Registration Statement a section entitled "Plan of Distribution," reasonably acceptable to the Initial Purchaser, which shall contain a summary statement of the positions taken or policies made by the Staff of the SEC with respect to the potential "underwriter" status of any broker-dealer that is the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of Appreciation Exchange Notes received by such broker-dealer in the Exchange Offer (a "Participating Broker-Dealer"), whether such positions or policies have been publicly disseminated by the Staff of the SEC or such positions or policies, in the judgment of the Initial Purchaser, represent the prevailing views of the Staff of the SEC.


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Such "Plan of Distribution" section shall also expressly permit the use of the Prospectus by all Persons subject to the prospectus delivery requirements of the Securities Act, including all Participating Broker-Dealers, and include a statement describing the means by which Participating Broker-Dealers may resell the Appreciation Exchange Notes.


Each of the Issuers shall use its reasonable best efforts to keep the Exchange Registration Statement effective and to amend and supplement the Prospectus contained therein, in order to permit such Prospectus to be lawfully delivered by any Participating Broker-Dealer subject to the prospectus delivery requirements of the Securities Act for such period of time as is necessary to comply with applicable law in connection with any resale of the Appreciation Exchange Notes; provided, however, that such period shall not exceed 180 days after the consummation of the Exchange Offer (or such longer period if extended pursuant to the last paragraph of Section 5 hereof) (the "Applicable Period").


If, prior to consummation of the Exchange Offer, the Initial Purchaser holds any Appreciation Notes acquired by it and having the status of an unsold allotment in the initial distribution, the Issuers shall, upon the request of the Initial Purchaser, simultaneously with the delivery of the Appreciation Exchange Notes in the Exchange Offer issue and deliver to the Initial Purchaser in exchange (the "Private Exchange") for such Appreciation Notes held by the Initial Purchaser a like principal amount of debt securities of the Company, guaranteed by the Guarantors, that are identical in all material respects to the Appreciation Exchange Notes (the "Private Appreciation Exchange Notes") (and which are issued pursuant to the same Appreciation Notes Indenture as the Appreciation Exchange Notes) except for the placement of a restrictive legend on such Private Appreciation Exchange Notes. The Private Appreciation Exchange Notes shall if permissible bear the same CUSIP number as the Appreciation Exchange Notes.


Interest on the Appreciation Exchange Notes and the Private Appreciation Exchange Notes will accrue from the last interest payment date on which interest was paid on the Appreciation Notes surrendered in exchange therefor or, if no interest has been paid on the Appreciation Notes, from the Issue Date.


In connection with the Exchange Offer, the Issuers shall:


(1) mail to each Holder a copy of the Prospectus forming part of
the Exchange Registration Statement, together with an appropriate
letter of transmittal and related documents;


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(2) utilize the services of a depositary for the Exchange
Offer with an address in the Borough of Manhattan, The City of
New York;


(3) permit Holders to withdraw tendered Appreciation Notes at
any time prior to the close of business, New York time, on the last
business day on which the Exchange Offer shall remain open; and


(4) otherwise comply in all material respects with all
applicable laws, rules and regulations.


As soon as practicable after the close of the Exchange Offer or the Private Exchange, as the case may be, the Issuers shall:


(1) accept for exchange all Appreciation Notes tendered and not
validly withdrawn pursuant to the Exchange Offer or the Private
Exchange;


(2) deliver to the Trustee for cancellation all Appreciation
Notes so accepted for exchange; and


(3) cause the Trustee to authenticate and deliver promptly to
each Holder of Appreciation Notes, Appreciation Exchange Notes or
Private Appreciation Exchange Notes, as the case may be, equal in
principal amount to the Appreciation Notes of such Holder so accepted
for exchange.


The Appreciation Exchange Notes and the Private Appreciation Exchange Notes are to be issued under (i) the Appreciation Notes Indenture or (ii) an indenture identical in all material respects to the Appreciation Notes Indenture, which in either event shall provide that (1) the Appreciation Exchange Notes shall not be subject to the transfer restrictions set forth in the Appreciation Notes Indenture and (2) the Private Appreciation Exchange Notes shall be subject to the transfer restrictions set forth in the Indenture. The Appreciation Notes Indenture or such indenture shall provide that the Appreciation Exchange Notes, the Private Appreciation Exchange Notes and the Appreciation Notes shall vote and consent together on all matters as one class and that none of the Appreciation Exchange Notes, the Private Appreciation Exchange Notes or the Appreciation Notes will have the right to vote or consent as a separate class on any matter.


(c) If, (i) because of any change in law or in currently prevailing interpretations of the Staff of the SEC, the Issuers are not permitted to effect an Exchange Offer, (ii) the Exchange Offer is not consummated within 120 days after the Filing Date, (iii) any


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holder of Private Appreciation Exchange Notes so requests at any time after the consummation of the Private Exchange, or (iv) if any Holder (other than the Initial Purchaser) is not eligible to participate in the Exchange Offer or such Holder does not receive Appreciation Exchange Notes on the date of the exchange that may be sold without restriction under the state and federal securities laws (other than due solely to the status of such Holder as an affiliate of any of the Issuers within the meaning of the Securities Act), then the Issuers shall promptly deliver to the Holders and the Appreciation Notes Trustee written notice thereof (the "Shelf Notice") and, in the case of clauses (i) and (ii) above, to all Holders, in the case of clause (iii) above, to the Holders of the Private Appreciation Exchange Notes and, in the case of clause (iv) above, to the affected Holder, and shall as promptly as reasonably practicable file a Shelf Registration pursuant to Section 3 hereof, provided, however, that in the case of clause (iii) above such holder shall pay all reasonable registration expenses of the Company as described in Section 6 hereof in connection with such Shelf Registration of such Private Appreciation Exchange Notes.


3. Shelf Registration


If a Shelf Notice is delivered as contemplated by Section 2(c) hereof, then:


(a) Shelf Registration. The Issuers shall as promptly as reasonably practicable file with the SEC a Registration Statement for an offering to be made on a continuous basis pursuant to Rule 415 covering all of the Registrable Notes (the "Shelf Registration"). If the Issuers shall not have yet filed an Exchange Registration Statement, each of the Issuers shall use its best efforts to file with the SEC the Shelf Registration on or prior to the Filing Date. The Shelf Registration shall be on Form S-1 or another appropriate form permitting registration of such Registrable Notes for resale by Holders in the manner or manners designated by them (including, without limitation, one or more underwritten offerings). The Issuers shall not permit any securities other than the Registrable Notes to be included in the Shelf Registration.


Each of the Issuers shall use its reasonable best efforts to cause the Shelf Registration to be declared effective under the Securities Act by the 180th day after the Issue Date and to keep the Shelf Registration continuously effective under the Securities Act until the date which is two years from the Issue Date, subject to extension pursuant to the last paragraph of Section 5 hereof, or such shorter period ending when all Registrable Notes covered by the Shelf Registration have been sold in the manner set forth and as contemplated in the Shelf Registration or when the Appreciation Notes become eligible for transfer without volume restrictions pursuant to Rule 144 under the Securities Act (the "Effectiveness Period").


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(b) Withdrawal of Stop Orders. If the Shelf Registration ceases to be effective for any reason at any time during the Effectiveness Period (other than because of the sale of all of the securities registered thereunder), each of the Issuers shall use its best efforts to obtain the prompt withdrawal of any order suspending the effectiveness thereof.


(c) Supplements and Amendments. The Issuers shall promptly supplement and amend the Shelf Registration if required by the rules, regulations or instructions applicable to the registration form used for such Shelf Registration, if required by the Securities Act, or if reasonably requested for such purpose by the Holders of a majority in aggregate principal amount of the Registrable Notes covered by such Registration Statement or by any underwriter of such Registrable Notes.


4. Additional Interest


(a) The Issuers and the Initial Purchaser agree that the Holders of Registrable Notes will suffer damages if the Issuers fail to fulfill their obligations under Section 2 or Section 3 hereof and that it would not be feasible to ascertain the extent of such damages with precision. Accordingly, the Issuers agree to pay, as the sole liquidated damages, for such failure additional interest on the Appreciation Notes ("Additional Interest") shall become payable with respect to the Appreciation Notes under the circumstances and to the extent set forth below:


(i) if neither the Exchange Registration Statement nor the Shelf
Registration has been filed on or prior to the Filing Date, then,
commencing on the 61st day after the Issue Date, Additional Interest
shall accrue on $3,000,000 at a rate of 0.50% per annum for the first
30 days commencing on the 61st day after the Issue Date, such
Additional Interest rate increasing by an additional 0.50% per annum
at the beginning of each subsequent 30-day period;


(ii) if neither the Exchange Registration Statement nor the Shelf
Registration is declared effective by the SEC on or prior to the
Effectiveness Date, then, commencing on the 91st day after the Filing
Date, Additional Interest shall accrue on $3,000,000 at a rate of
0.50% per annum for the first 30 days commencing on the 91st day after
the Filing Date, such Additional Interest rate increasing by an
additional 0.50% per annum at the beginning of each subsequent 30-day
period; and


(iii) if (A) the Issuers have not exchanged Exchange Notes
for all Appreciation Notes validly tendered in accordance with the
terms of the Exchange Offer on or prior to the 120th day after the
Filing Date or (B) the Exchange


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