Exhibit 99.4
AMERICAN RADIO EXHIBIT J
FORM OF SUBSIDIARY GUARANTY
SUBSIDIARY GUARANTY (this "Agreement"), dated as of January 24, 1997,
by and among AMERICAN RADIO SYSTEMS LICENSE CORP., a Delaware corporation, ARS
ACQUISITION II, INC., a Delaware corporation, RADIO SYSTEMS OF MIAMI, INC., a
Delaware corporation and RADIO SYSTEMS OF PHILADELPHIA, INC., a Pennsylvania
corporation (collectively, the "Current Guarantors"), such other Persons which
from time to time may become party hereto (the "Additional Guarantors", and
collectively with the Current Guarantors, the "Guarantors") and THE BANK OF NEW
YORK, in its capacity as Collateral Agent (the "Collateral Agent") for the
following Persons (collectively, the "Secured Creditors"): (i) the
Administrative Agent and the Lenders under, and as each term is defined in, the
$550,000,000 Credit Agreement (as hereinafter defined), (ii) the Administrative
Agent and the Lenders under, and as each term is defined in, the $350,000,000
Credit Agreement (as hereinafter defined) and (iii) for such of the Lenders
under the $550,000,000 Credit Agreement, the Lenders under the $350,000,000
Credit Agreement and any of their respective Affiliates which from time to time
enter into Interest Rate Protection Agreements with American Radio Systems
Corporation (the "Borrower").
RECITALS
I. Reference is made to (i) a $550,000,000 Credit Agreement, dated as of
the date hereof, among the Borrower, the lenders party thereto, the
Co-Syndication Agents, the Managing Agents, the Agent, the Co-Agents,
the Collateral Agent and the Administrative Agent (as amended,
supplemented or otherwise modified from time to time, the "$550,000,000
Credit Agreement") and (ii) a $350,000,000 Credit Agreement, dated as
of the date hereof, among the Borrower, the lenders party thereto, the
Co-Syndication Agents, the Managing Agents, the Agent, the Co- Agents,
the Collateral Agent and the Administrative Agent (as amended,
supplemented or otherwise modified from time to time, the "$350,000,000
Credit Agreement", and together with the $550,000,000 Credit Agreement,
the "Credit Agreements").
II. The Borrower and the Guarantors have been, and are now, engaged in the
business of radio broadcasting and activities related thereto. Each
Guarantor expects
to derive substantial benefit from the Credit Agreements and the
transactions contem plated thereby and, in furtherance thereof, and in
order to induce the Lenders to make Loans and any Secured Creditor to
enter into an Interest Rate Protection Agreement, has agreed to execute
and deliver this Agreement. Pursuant to the Credit Agreements, the
Lenders will not make Loans unless and until the Guarantors shall have
executed and delivered this Agreement.
Therefore, in consideration of the Recitals, the terms and conditions
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each of the Collateral Agent and
the Guarantors hereby agrees as follows:
1. Defined Terms
(a) Capitalized terms used herein which are not otherwise
defined herein shall have the respective meanings ascribed thereto in the Credit
Agreements as in effect on the date hereof.
(b) When used in this Agreement, the following capitalized
terms shall have the respective meanings ascribed thereto as follows:
"Bankruptcy Code": Title 11 of the United States Code entitled
"Bankruptcy".
"Borrower Obligations": all of the obligations and liabilities
of the Borrower under the Loan Documents as defined in the $550,000,000 Credit
Agreement, the Loan Documents as defined in the $350,000,000 Credit Agreement
and each Interest Rate Protection Arrangement with one or more of the Lenders
under either of the Credit Agreements or any of their respective Affiliates, in
each case whether fixed, contingent, now existing or hereafter arising, created,
assumed, incurred or acquired, and whether before or after the occurrence of any
Insolvency Event, and including, without limitation (a) any obligation or
liability in respect of any breach of any representation or warranty and in
respect of any rights of redemption or rescission, and (b) all post-petition
interest, funding losses and make-whole premiums, whether or not allowed as a
claim in any proceeding arising in connection with an Insolvency Event.
"Consideration": as of any date of determination and with
respect to each Guarantor, an amount equal to the lesser of (a) the total
"value" (within the meaning of Section 548 of the Bankruptcy Code as in effect
on the date hereof) given, directly or indirectly, to such Guarantor during the
period commencing on the date such Guarantor became a party to this Agreement
and ending on such date of determination, in exchange
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for its execution and delivery of this Agreement, and (b) the amount of "fair
consideration" (within the meaning of Article 10 of the New York Debtor Creditor
Law as in effect on the date hereof) given, directly or indirectly, to such
Guarantor during the period commencing on the date such Guarantor became a party
to this Agreement and ending on such date of determination in exchange for its
execution and delivery of this Agreement.
"Event of Default": as defined in Section 16.
"Guarantor Obligations": with respect to each Guarantor, all
of the obligations and liabilities of such Guarantor hereunder, whether fixed,
contingent, now existing or hereafter arising, created, assumed, incurred or
acquired.
"Insolvency Event": any Event of Default under Sections 9.1(h)
or 9.1(i) of the Credit Agreements.
"Net Worth": as of any date and with respect to each
Guarantor, the lesser of the following:
(a)(i) all of such Guarantor's "property, at a fair valuation"
(within the meaning of Section 101(32) of the Bankruptcy Code as in
effect on the date hereof) on such date, minus (ii) the sum of such
Guarantor's "debts" (within the meaning of Section 101(12) of the
Bankruptcy Code as in effect on the date hereof) on such date
(exclusive of such "debts" in respect of this Guaranty), or
(b)(i) the "fair salable value of the assets" (within the
meaning of Article 10 of the New York Debtor Creditor Law as in effect
on the date hereof) of such Guarantor on such date, minus (ii) "the
amount that will be required to pay such Guarantor's probable liability
on its existing debts as they become absolute and matured" (as such
phrase would be construed under Article 10 of the New York Debtor
Creditor Law as in effect on the date hereof) on such date (exclusive
of such debts in respect of this Guaranty).
"Supplement": a Supplement to this Agreement, duly completed,
in the form of Annex A hereto.
2. Guaranty
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(a) Subject to Section 2(b) hereof, each Guarantor hereby
absolutely, ir revocably and unconditionally guarantees the full and prompt
payment when due (whether at stated maturity, by acceleration or otherwise) of
the Borrower Obligations. This Agreement constitutes a guaranty of payment, and
neither the Collateral Agent nor any Secured Creditor shall have any obligation
to enforce any Loan Document or any Interest Rate Protection Arrangement or
exercise any right or remedy with respect to any collateral security thereunder
by any action, including, without limitation, making or perfecting any claim
against any Person or any collateral security for any of the Borrower
Obligations prior to being entitled to the benefits of this Agreement. The
Collateral Agent may, at its option, proceed against the Guarantors, or any one
or more of them, in the first instance, to enforce the Guarantor Obligations
without first proceeding against the Borrower or any other Person, and without
first resorting to any other rights or remedies, as the Collateral Agent may
deem advisable. In furtherance hereof, if the Collateral Agent or any Secured
Creditor is prevented by law from collecting or otherwise hindered from
collecting or otherwise enforcing any Borrower Obligation in accordance with its
terms, the Collateral Agent or such Secured Creditor, as the case may be, shall
be entitled to receive hereunder from the Guarantors after demand therefor, the
sums which would have been otherwise due had such collection or enforcement not
been prevented or hindered.
(b) Notwithstanding anything to the contrary contained in this
Agreement, the maximum liability of each Guarantor under this Agreement shall
not, as of any date of determination, exceed the lesser of (i) the highest
amount that is valid and enforceable against such Guarantor under principles of
New York State contract law, and (ii) the sum of (1) all Consideration received
by such Guarantor as of such date of determination, plus (2) 95% of the Net
Worth of such Guarantor on such date of determination. In calculating the
maximum liability of each Guarantor hereunder, full effect shall be given to any
provision in any other Indebtedness of or guaranteed by such Guarantor which for
purposes of applicable fraudulent transfer or similar laws provides that
indebtedness incurred under the Credit Agreements shall be deemed to have been
incurred prior to such other Indebtedness.
(c) Each Guarantor agrees that the Guarantor Obligations may
at any time and from time to time exceed the maximum liability of such Guarantor
hereunder without impairing this Agreement or affecting the rights and remedies
of the Collateral Agent or any Secured Creditor hereunder.
3. Absolute Obligation
Subject to Section 20, no Guarantor shall be released from
liability hereunder
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unless and until the Maturity Date shall have occurred and either (a) the
Borrower Obligations shall have been paid in full, in cash, or (b) the Guarantor
Obligations of such Guarantor shall have been paid in full, in cash. Each
Guarantor acknowledges and agrees that (1) neither the Collateral Agent nor any
Secured Creditor has made any representation or warranty to such Guarantor with
respect to the Borrower, its Subsidiaries, any Loan Document, any Interest Rate
Protection Arrangement, or any agreement, instrument or document executed or
delivered in connection therewith or any other matter whatsoever, and (2) such
Guarantor shall be liable hereunder, and such liability shall not be affected or
impaired, irrespective of (A) the validity or enforceability of any Loan
Document, any Interest Rate Protection Arrangement, or any agreement, instrument
or document executed or delivered in connection therewith, or the collectability
of any of the Borrower Obligations, (B) the preference or priority ranking with
respect to any of the Borrower Obligations, (C) the existence, validity,
enforceability or perfection of any security interest or collateral security
under any Loan Document, or any Interest Rate Protection Arrangement, or the
release, exchange, substitution or loss or impairment of any such security
interest or collateral security, (D) any failure, delay, neglect or omission by
the Collateral Agent or any Secured Creditor to realize upon or protect any
direct or indirect collateral security, indebtedness, liability or obligation,
any Loan Document, any Interest Rate Protection Arrangement, or any agreement,
instrument or document executed or delivered in connection therewith, or any of
the Borrower Obligations, (E) the existence or exercise of any right of set-off
by the Collateral Agent or any Secured Creditor, (F) the ex istence, validity or
enforceability of any other guaranty with respect to any of the Borrower
Obligations, the liability of any other Person in respect of any of the Borrower
Obligations, or the release of any such Person or any other guarantor of any of
the Borrower Obligations, (G) any act or omission of the Collateral Agent or any
Secured Creditor in connection with the administration of any Loan Document, any
Interest Rate Protection Arrangement, or any of the Borrower Obligations, (H)
the bankruptcy, insolvency, reorganization or receivership of, or any other
proceeding for the relief of debtors com menced by or against, any Person, (I)
the disaffirmance or rejection, or the purported disaffirmance or purported
rejection, of any of the Borrower Obligations, any Loan Docu ment, any Interest
Rate Protection Arrangement, or any agreement, instrument or document executed
or delivered in connection therewith, in any bankruptcy, insolvency,
reorganization or receivership, or any other proceeding for the relief of
debtor, relating to any Person, (J) any law, regulation or decree now or
hereafter in effect which might in any manner affect any of the terms or
provisions of any Loan Document, any Interest Rate Protection Arrangement, or
any agreement, instrument or document executed or delivered in connection
therewith or any of the Borrower Obligations, or which might cause or permit
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to be invoked any alteration in the time, amount, manner or payment or
performance of any of the Borrower's obligations and liabilities (including,
without limitation, the Borrower Obligations), (K) the merger or consolidation
of the Borrower into or with any Person, (L) the sale by the Borrower of all or
any part of its assets, (M) the fact that at any time and from time to time none
of the Borrower Obligations may be outstanding or owing to the Collateral Agent
or any Secured Creditor, (N) any amendment or modification of, or supple ment
to, any Loan Document or any Interest Rate Protection Arrangement or (O) any
other reason or circumstance which might otherwise constitute a defense
available to or a dis charge of the Borrower in respect of its obligations or
liabilities (including, without limitation, the Borrower Obligations) or of such
Guarantor in respect of any of the Guaran tor Obligations (other than by the
performance in full thereof).
4. Grant of Security Interest.
Each Guarantor, in order to secure the payment and performance
of all of its Guarantor Obligations, hereby grants to the Collateral Agent, for
its benefit and for the ratable benefit of the Secured Creditors, a continuing
first priority security interest in and to all of such Guarantor's right, title
and interest in and to the following, in each case whether now owned or existing
or hereafter arising or acquired and wherever located (col lectively, the
"Collateral"):
CAPITAL STOCK: All Capital Stock of each Person which now is
or may hereafter become a Subsidiary of such Guarantor, including, without
limitation, the Stock listed in Part A of Schedule 1 (the "Pledged Capital
Stock"), and all payments thereunder and instruments and other Property (other
than real Property) from time to time delivered in respect thereof or in
exchange therefor), together with all substitutions, exchanges and replacements
therefor, and all Proceeds thereof (collectively, the "Capital Stock");
INSTRUMENTS: All "instruments" as defined in the UCC,
including, without limitation, the notes and debt instruments described in Part
B of Schedule 1 (the "Pledged Debt"), and all payments thereunder and
instruments and other Property (other than real Property) from time to time
delivered in respect thereof or in exchange therefor), together with all
substitutions, exchanges and replacements therefor, and the Proceeds thereof
(collectively, the "Instruments"); and
MATERIAL AGREEMENTS: The License Subsidiary Management
Agreements, the PBB Documents and all other similar documents and agreements,
and all local marketing agreements and time brokerage agreements and all other
similar agreements together with all substitutions, exchanges and replacements
therefor, and the Proceeds
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thereof (collectively, the "Material Agreements").
As used herein, the term "Proceeds" shall have the meaning
assigned to it under Article 9 of the New York Uniform Commercial Code (as the
same is amended from time to time, the "UCC") and, to the extent not otherwise
included, shall include, but not be limited to, (i) any stock dividend or
distribution in connection with any increase or reduction of capital,
reclassification, merger, consolidation, sale of assets, combination of shares,
stock split, spin-off or split-off; (ii) any option or other right, whether
received as an addition, in substitution or exchange, or otherwise; (iii)
dividends or distributions on dissolution, or in partial or total liquidation,
or from capital, capital surplus, or paid-in surplus; (iv) any and all proceeds
of any insurance, causes and rights of action or settlements thereof, escrowed
amounts or Property, judicial and arbitration judgments and awards, payable to
such Guarantor from or in respect of any Person from time to time whether with
respect to the Collateral; (v) any and all payments (in any form whatsoever)
made or due and payable to such Guarantor from time to time in connection with
any requi sition, confiscation, condemnation, seizure or forfeiture of all or
any part of the Collateral by any Governmental Authority; (vi) all claims of
such Guarantor for losses or damages arising out of or relating to or for any
breach of any agreements, covenants, representations or warranties or any
default whether or not with respect to or under any of the foregoing Collateral
(without limiting any direct or independent rights of the Collateral Agent or
any Secured Creditor with respect to the Collateral); and (vii) any and all
other amounts from time to time paid or payable under or in connection with the
Collateral.
5. Guarantor Remains Liable.
Anything herein to the contrary notwithstanding, (a) each
Guarantor shall remain liable under the contracts and agreements included in the
Collateral to the extent set forth therein to perform all of its duties and
obligations thereunder to the same extent as if this Agreement had not been
executed, (b) the exercise by the Collateral Agent of any of its rights
hereunder shall not release any such Guarantor from any of its duties or
obligations under the contracts and agreements included in the Collateral, and
(c) the Collateral Agent shall not have any obligation or liability under the
contracts and agreements included in the Collateral by reason of this Agreement,
nor shall the Collateral Agent be obligated to perform any of the obligations or
duties of any such Guarantor thereunder, to make any payment, to make any
inquiry as to the nature or sufficiency of any payment received by any such
Guarantor or the sufficiency of any performance by any party under any such
contract or agreement or to take any action to collect or enforce any claim for
pay ment assigned hereunder.
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6. Delivery of Pledged Collateral.
All certificates, notes and other instruments, if any,
representing or evidencing the Pledged Capital Stock or the Pledged Debt and all
other Capital Sock and Instruments at any time owned or acquired by any
Guarantor (collectively, the "Pledged Collateral") shall be delivered to and
held by or on behalf of the Collateral Agent pursuant hereto and shall be in
suitable form for transfer by delivery, or shall be accompanied by duly executed
instruments of transfer or assignments in blank, all in form and substance
reasonably satisfactory to the Collateral Agent. Subject to Section 17(f), upon
the occurrence and during the continuance of an Event of Default, the Collateral
Agent shall have the right, at any time in its discretion and without notice to
such Guarantor, to transfer to or to register in the name of the Collateral
Agent or any of its nominees any or all of the Pledged Collateral. In addition,
upon the occurrence and during the continuance of an Event of Default, the
Collateral Agent shall have the right at any time to exchange certificates or
instruments representing or evidencing Pledged Collateral for certificates or
instruments of smaller or larger denominations.
7. Representations and Warranties
Each Guarantor hereby represents and warrants to the
Collateral Agent as follows:
(i) Binding Agreement. This Agreement constitutes the valid
and binding obligation of such Guarantor, enforceable in accordance with its
terms, except as such en forceability may be limited by applicable bankruptcy,
insolvency, reorganization, morato rium or similar laws related to or affecting
the enforcement of creditors' rights generally.
(ii) Solvency; Ability to Pay Debts. Such Guarantor (if a
Current Guarantor, both immediately before and after giving effect to this
Agreement and to all Indebtedness incurred by the Borrower in connection
therewith or, if an Additional Guarantor, immediately before and after giving
effect to this Agreement) (1) is not insolvent, (2) is not engaged, and is not
about to engage, in business or a transaction, for which it has unreasonably
small capital, and (3) does not intend to incur, and does not believe that it
would incur, debts that would be beyond its ability to pay such debts as they
mature, in each case referred to above within the meaning of both the Bankruptcy
Code and Article 10 of the New York Debtor Creditor Law, each as in effect on
the date hereof.
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(iii) Corporate Authority. Such Guarantor has full power and
authority to enter into, execute, deliver and perform the terms of this
Agreement and to incur the obligations provided for herein, all of which have
been duly authorized by all proper and necessary corporate action and are in
full compliance with its certificate of incorporation and by-laws.
(iv) No Misrepresentation. No representation or warranty
contained herein and no certificate or report furnished or to be furnished by
such Guarantor in connection with the transactions contemplated hereby, contains
or will contain a misstatement of material fact, or, to the best knowledge of
such Guarantor, omits or will omit to state a material fact required to be
stated in order to make the statements herein or therein con tained not
misleading in the light of the circumstances under which made.
(v) Names; Tradenames. As of the date of this Agreement, such
Guarantor currently conducts business under its own name and, in certain areas
and for certain operations, the tradenames listed on Schedule 7(b)(i).
(vi) Offices. As of the date of this Agreement (i) the chief
executive office and chief place of business of such Guarantor are located at
the address set forth in Part A of Schedule 7(b)(ii), and (ii) in addition to
such chief executive office and chief place of business, such Guarantor
maintains only the offices and places of business set forth in Part B of
Schedule 7(b)(ii).
(vii) Absence of Liens. Such Guarantor is the legal and
beneficial owner of the Collateral, free and clear of all Liens, except
Permitted Liens.
(viii) Pledged Collateral. To the best of such Guarantor's
knowledge, the Pledged Debt has been duly authorized, issued and delivered, and
is the legal, valid, binding and enforceable obligation of the respective
issuers thereof, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other similar rights affecting the
enforcement of creditors' rights generally. The Pledged Capital Stock (to the
extent certificated within the meaning of the UCC) and the Pledged Debt
constitute all of the Pledged Collateral, except for Pledged Collateral
consisting of checks and drafts received in the ordinary course of business.
(ix) Security Interest. This Agreement creates a valid
security interest in the Collateral, securing the payment of the obligations of
such Guarantor hereunder, and all
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filings and other actions necessary or desirable to perfect such security
interests have been or, substantially simultaneously with the execution and
delivery of this Agreement, will be, duly taken, except with respect to Property
as to which security interests are not subject to perfection under the UCC. The
delivery and pledge of the Pledged Collateral pursuant to this Agreement and all
other filings and other actions taken by such Guarantor to perfect such security
interests prior to the date hereof, create a valid and perfected first priority
security interest in the Pledged Collateral securing the payment of the
obligations of such Guarantor hereunder, except for Pledged Collateral
consisting of checks and drafts received in the ordinary course of business.
8. Further Assurances.
(a) Each Guarantor agrees that from time to time, at its
expense, such Guarantor shall promptly execute and deliver all further
instruments and documents, and take all further action, that the Collateral
Agent may reasonably request, in order to perfect and protect any security
interests granted hereby or to enable the Collateral Agent to exercise and
enforce its rights and remedies hereunder with respect to any Collateral.
Without limiting the generality of the foregoing, each Guarantor shall promptly
execute and file such financing or continuation statements, or amendments
thereto, and such other instruments or notices, and promptly take such other
action as the Collateral Agent may reasonably request, in order to perfect and
preserve the security interests granted hereby.
(b) Each Guarantor hereby authorizes the Collateral Agent to
file one or more financing or continuation statements, and amendments thereto,
relative to all or any part of the Collateral without the signature of such
Guarantor where permitted by law. The Collateral Agent shall provide such
Guarantor with a copy of any such statement or amendment, provided that no
failure to do so shall affect the rights of the Collateral Agent hereunder,
result in any liability of the Collateral Agent or any Secured Creditor to such
Guarantor or in any way affect the validity of such filing. A photographic or
other reproduction of this Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.
(c) Each Guarantor shall furnish to the Collateral Agent from
time to time statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the
Collateral Agent may reasonably request, all in reasonable detail.
9. Principal Place of Business.
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Each Guarantor shall keep its chief place of business and
chief executive office at the locations therefor specified in Section 7(b)(ii)
or, upon at least thirty days prior written notice to the Collateral Agent, at
such other locations in a jurisdiction where all ac tions required by Section 8
shall have been taken.
10. As to the Pledged Collateral.
So long as no Event of Default shall have occurred and be
continuing:
(i) Each Guarantor shall be entitled to exercise any and all
voting and other consensual rights pertaining to the Pledged Collateral or any
part thereof for any purpose not inconsistent with the terms of this Agreement
and the Credit Agreements; provided, however, that such Guarantor shall not
exercise or refrain from exercising any such right without the consent of the
Collateral Agent if such action or inaction would have a material adverse effect
on the fair market value of any part of the Pledged Collateral or the validity,
priority or perfection of the security interests granted hereby or the remedies
of the Collateral Agent hereunder.
(ii) Each Guarantor shall be entitled to receive and retain
any and all dividends, principal, interest and other distributions paid in
respect of the Pledged Collateral to the extent not prohibited by this
Agreement; provided, however, that any and all dividends, principal, interest
and other distributions paid or payable other than in cash in respect of, and
instruments and other Property received, receivable or otherwise distributed in
respect of, or in exchange for, Pledged Collateral, shall forthwith be delivered
to the Collateral Agent to hold as Pledged Collateral and shall, if received by
such Guarantor, be received in trust for the benefit of the Collateral Agent, be
segregated from the other Property of such Guarantor, and be forthwith delivered
to the Collateral Agent, as Pledged Collateral in the same form as so received
(with any necessary indorsement).
(iii) The Collateral Agent shall execute and deliver (or cause
to be executed and delivered) to each Guarantor all such proxies and other
instruments as such Guarantor may reasonably request for the purpose of enabling
such Guarantor to exercise the voting and other rights which it is entitled to
exercise pursuant to clause (i) above and to receive the distributions,
principal or interest payments which it is authorized to receive and retain
pursuant to clause (ii) above.
(a) Upon the occurrence and during the continuance of an Event
of
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Default and at the Collateral Agent's option and following written notice by the
Collateral Agent to such Guarantor:
(i) Subject to Section 17(f), all rights of such Guarantor to
exercise the voting and other consensual rights which it would otherwise be
entitled to exercise pursuant to Section 10(a)(i) and to receive the dividends,
principal, and interest payments and other distributions which it would
otherwise be authorized to receive and retain pursuant to Section 10(a)(ii)
shall cease, and all such rights shall thereupon become vested in the Collateral
Agent, who shall thereupon have the sole right to exercise such vot ing and
other consensual rights and to receive and hold as Pledged Collateral such dis
tributions and principal and interest payments.
(ii) All dividends, principal and interest payments and other
distributions which are received by such Guarantor contrary to the provisions of
Section 10(b)(i) shall be received in trust for the benefit of the Collateral
Agent, shall be segregated from other funds of such Guarantor and shall be
forthwith paid over to the Collateral Agent as Pledged Collateral in the same
form as so received (with any necessary indorsement).
(b) In the event that all or any part of the securities or
instruments constituting the Pledged Collateral are lost, destroyed or
wrongfully taken while such securities or instruments are in the possession of
the Collateral Agent, such Guarantor agrees that it will cause the delivery of
new securities or instruments in place of the lost, destroyed or wrongfully
taken securities or instruments upon request therefor by the Collateral Agent
without the necessity of any indemnity bond or other security other than the
Collateral Agent's agreement or indemnity therefor customary for security
agreements similar to this Agreement.
11. Additional Shares.
Each Guarantor agrees that it will cause each issuer of the
Capital Stock not to issue to such Guarantor any Stock or other securities in
addition to or in substitution for the Pledged Stock issued by such issuer,
unless immediately upon its acquisition (directly or indirectly) thereof, any
and all additional shares of Stock or other securities of each such issuer are
pledged to and delivered by such Guarantor to the Collateral Agent hereunder.
12. Other Covenants and Agreements of each Guarantor.
Each Guarantor covenants and agrees that on and after the date
hereof until the indefeasible cash payment in full of the Obligations, unless
the Collateral Agent shall
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otherwise consent in writing:
(a) Defense of Collateral. Such Guarantor will defend the
Collateral against all claims and demands of all Persons at any time claiming
the same or any interest therein adverse to the interests of the Collateral
Agent.
(b) Security Interest. Such Guarantor covenants that the
security interests granted hereby constitute and shall at all times constitute
continuing perfected first priority security interests in the Collateral, except
for Permitted Liens.
(c) Encumbrances; Filings. Such Guarantor will not (i) further
hypothecate, pledge, encumber, transfer, sell or otherwise suffer to exist a
security interest in, or a Lien on, the Collateral or any portion thereof in
favor of any Person other than the Collateral Agent as provided herein, except
for Permitted Liens or (ii) sign or file or authorize the signing or filing of
any document or instrument perfecting any Lien on the Collateral except for
Permitted Liens. The inclusion of "Proceeds" of the Collateral under the
security interest granted herein shall not be deemed a consent by the Collateral
Agent to any sale or other disposition of any Collateral except as expressly
permitted herein.
13. The Collateral Agent Appointed Attorney-in-Fact.
Effective upon the occurrence and during the continuance of an
Event of Default, subject to Section 17(f), each Guarantor hereby irrevocably
appoints the Collateral Agent such Guarantor's attorney-in-fact, with full
authority in the place and stead of such Guarantor and in the name of such
Guarantor or otherwise, from time to time in the Collateral Agent's discretion,
to take any action and to execute any instrument which the Collateral Agent may
deem necessary or advisable to accomplish the purposes of this Agreement,
including, without limitation:
(a) to obtain and adjust insurance required to be paid to the
Collateral Agent pursuant to section 7.5 of the Credit Agreements,
(b) to ask, demand, collect, xxx for, recover, compromise,
receive and give acquittance and receipts for moneys due and to become due under
or in respect of any of the Collateral,
(c) to receive, indorse, and collect any drafts or other
chattel paper,
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instruments and documents in connection with clause (a) or (b) above,
(d) to file any claims or take any action or institute any
proceedings which the Collateral Agent may deem necessary or desirable for the
collection of any of the Col lateral or otherwise to enforce the rights of the
Collateral Agent with respect to any of the Collateral, and
(e) to receive, indorse and collect all instruments made
payable to such Guarantor representing any dividend, interest payment or other
distribution in respect of the Pledged Collateral or any part thereof and to
give full discharge for the same.
14. The Collateral Agent May Perform.
If any Guarantor fails to perform any agreement contained
herein, the Collateral Agent may itself perform, or cause performance of, such
agreement, and the reasonable expenses of the Collateral Agent incurred in
connection therewith shall be payable by such Guarantor under Section 19.
15. The Collateral Agent's Duties.
The powers conferred on the Collateral Agent hereunder are
solely to protect its interest in the Collateral and shall not impose any duty
upon it to exercise any such powers. Except for the safe custody of any
Collateral in its possession and the accounting for moneys actually received by
it hereunder, the Collateral Agent shall have no duty as to any Collateral. The
Collateral Agent shall be deemed to have exercised reasonable care in the
custody and preservation of the Collateral in its possession if the Collateral
is accorded treatment substantially equal to that which the Collateral Agent
accords its own property, it being understood that the Collateral Agent shall
not be under any obligation to (i) ascertain or take action with respect to
calls, conversions, exchanges, maturities, tenders or other matters relative to
any Pledged Collateral, whether the Collateral Agent or any Secured Creditor has
or is deemed to have knowledge of such matters, or (ii) take any necessary steps
to preserve rights against prior parties or any other rights pertaining to any
Collateral, but may do so at its option, and all reasonable expenses incurred in
connection therewith shall be for the sole account of the Guarantors and shall
be added to the Obliga tions.
16. Events of Default
Each of the following shall constitute an "Event of Default":
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(a) The occurrence and continuance of an "Event of Default"
under and as defined in either of the Credit Agreements; or
(b) If any representation or warranty made herein or in any
certificate furnished by any Guarantor in connection with this Agreement shall
prove to have been incorrect or misleading (whether because of misstatement or
omission) in any material respect when made; or
(c) If any Guarantor shall fail to observe or perform any
term, covenant or agreement contained in Section 2, 11 or 12(c) of this
Agreement; or
(e) If any Guarantor shall fail to perform or observe any
other covenant or agreement on its part to be performed or observed pursuant to
this Agreement and such failure shall have continued unremedied for a period of
30 days after such Guarantor shall become aware of such failure; or
(f) If any Guarantor shall contest or disavow its obligations
under this Agreement or this Agreement shall not remain in full force and
effect.
17. Remedies.
Upon the occurrence of an Event of Default or at any time
thereafter during the continuance thereof, the Collateral Agent may, and upon
direction of the Combined Required Lenders shall, exercise any and all remedies
and other rights provided under this Agreement, including, without limitation,
the following:
(a) The Collateral Agent may take any action any Guarantor is
required to take or any other necessary action to obtain, preserve and enforce
this Agreement, and maintain and preserve the Collateral, without notice to such
Guarantor, and add the costs of the same to the Obligations (but the Collateral
Agent is under no duty to take any such action);
(b) The Collateral Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party upon
default under the UCC as in effect from time to time (whether or not the UCC
applies to the affected Collateral) and also may (i) require each Guarantor to,
and each Guarantor hereby agrees that it will at its expense and upon
-15-
request of the Collateral Agent forthwith, assemble all or any part of the
Collateral as directed by the Collateral Agent and make it available to the
Collateral Agent at a place designated by the Collateral Agent which is
reasonably convenient to the Collateral Agent and such Guarantor, (ii) without
notice, except as specified below, sell, lease, assign, grant an option or
options to purchase or otherwise dispose of the Collateral or any part thereof
in one or more parcels at public or private sale, at any exchange, broker's
board or at any of the Collateral Agent's offices or elsewhere, for cash, on
credit or for future delivery, and upon such other terms as may be commercially
reasonable. Each Guarantor agrees that, to the extent notice of sale shall be
required by law, at least five Business Days' notice to such Guarantor of the
time and place of any public sale or the time after which any private sale is to
be made shall constitute reasonable notification. The Collateral Agent shall not
be obligated to make any sale of Collateral regardless of notice of sale having
been given. The Collateral Agent may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and such sale
may, without further notice, be made at the time and place to which it was so
adjourned.
(c) Any cash held by the Collateral Agent as Collateral and
all cash proceeds received by the Collateral Agent in respect of any sale of,
collection from, or other realization upon all or any part of the Collateral
may, in the discretion of the Collateral Agent, be held by the Collateral Agent
as Collateral, and/or then or at any time thereafter applied (after payment of
any amounts payable to the Collateral Agent pursuant to Section 19) in whole or
in part by the Collateral Agent to the Administrative Agent under the
$550,000,000 Credit Agreement and the Administrative Agent under the
$350,000,000 Credit Agreement pro rata in accordance with the priorities
contained in section 9.1 of the Credit Agreements. Any surplus of such cash or
cash proceeds held by the Collateral Agent and remaining after payment in full
of all the Obligations shall be promptly paid over to the applicable Guarantor
or to whomsoever may be lawfully entitled to receive such surplus.
(d) Upon the completion of any sale or other disposition of
all or any part of the Collateral under this Section, full title and right of
possession to such Collateral shall pass to such purchaser or purchasers
forthwith upon the completion of such sale. Neverthe less, if so requested by
the Collateral Agent or by any purchaser of such Collateral, each Guarantor
shall confirm any such sale or disposition by executing and delivering to such
purchaser all proper instruments of conveyance and transfer and releases as may
be designated in any such request. To the extent permitted by applicable law,
every such sale or other disposition shall operate to divest all right, title,
interest, claim and demand whatsoever of such Guarantor of, in and to the
Collateral so sold or disposed of and shall be a perpetual bar, both at law and
in equity, against such Guarantor, all persons claiming the Collateral sold or
disposed of, or any part thereof, through such Guarantor, and its
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successors and assigns.
(e) At any sale or other disposition hereunder, the Collateral
Agent may bid for and purchase the Collateral offered for sale, and, upon
compliance with the terms of sale or other disposition, may hold, retain and
dispose of such Collateral without further accountability therefor. Any such
purchaser at any sale or other disposition hereunder shall be entitled, for the
purpose of making payment for the Collateral purchased, to apply any part of the
Obligations due and payable to it as a credit against the purchase price of such
Collateral.
(f) Notwithstanding anything to the contrary contained in this
Agreement, any other Loan Document or in any other agreement, instrument or
document executed by any Guarantor and delivered to the Collateral Agent or any
Secured Creditor, neither the Collateral Agent nor any Secured Creditor will
take any action pursuant to this Agreement, any other Loan Document or any other
document referred to above which would constitute or result in any assignment of
any FCC license or any change of control of any such Guarantor or any Subsidiary
of any such Guarantor if such assignment of any FCC license or change of control
would require, under then existing law, the prior approval of the FCC without
first obtaining such prior approval of the FCC. Each Guarantor waives any right
it may have to oppose, and agrees to take any action which the Collateral Agent
may reasonably request in order to obtain from the FCC, such approval as may be
necessary to enable the Collateral Agent to exercise and enjoy the full rights
and benefits granted to the Secured Creditors by this Agreement and the other
documents referred to above, including specifically, at the cost and expense of
such Guarantor, the use of commercially reasonable efforts to assist in
obtaining approval of the FCC for any action or transaction contemplated by this
Agreement for which such approval is or shall be required by law, and
specifically, without limitation, upon request, to prepare, sign and file with
the FCC the assignor's or transferor's portion of any application or
applications for consent to the assignment of license or transfer of control
necessary or appropriate under the FCC's rules and regulations for approval of
(a) any sale or other disposition of the Collateral by or on behalf of the
Collateral Agent, or (b) any assumption by the Collateral Agent of voting rights
in the Col lateral effected in accordance with the terms of this Agreement. It
is understood and agreed that all foreclosure and related actions will be made
in accordance with Section 310 of the Communications Act.
(g) Each Guarantor hereby expressly waives and covenants, to
the extent permitted by applicable law, not to assert any appraisement,
valuation, stay, extension,
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redemption or similar laws, now or at any time hereafter in force, which might
delay, prevent or otherwise impede the performance or enforcement of this
Agreement.
(h) Each Guarantor recognizes that the Collateral Agent may be
compelled to resort to one or more private sales of the Capital Stock to a
restricted group of purchasers who will be obliged to agree, among other things,
to acquire such Capital Stock for their own accounts, for investment, and not
with a view to the distribution or resale thereof. Each Guarantor agrees that
private sales so made may be at prices and other terms less favorable to the
seller than if the Capital Stock were sold at public sales and that the
Collateral Agent shall have no obligation to delay sale of any such Capital
Stock for the pe riod of time necessary to permit such Guarantor, even if such
Guarantor would agree, to register such Capital Stock for public sale under the
Securities Act of 1933, as amended. Each Guarantor agrees that private sales
made under the foregoing circumstances shall be deemed to have been conducted in
a commercially reasonable manner.
18. Notices
Except as otherwise expressly provided herein, all notices,
requests and demands to or upon the respective parties hereto to be effective
shall be in writing and, unless otherwise expressly provided herein, shall be
deemed to have been duly given or made (i) when delivered by hand, or (ii) one
Business Day after having been sent by overnight courier service, (iii) five
Business Days after having been deposited in the mail, first-class postage
prepaid, or (iv) in the case of telecopier notice, when sent, addressed as
follows, or to such other addresses as to which the Collateral Agent may be
hereafter notified by a party hereto:
The Current Guarantors:
c/o American Radio Systems Corporation
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxx
Chief Financial Officer
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
The Collateral Agent:
-00-
Xxx Xxxx xx Xxx Xxxx, as Collateral Agent
Communications, Publishing & Entertainment Division
Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxx
Vice President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
19. Expenses
Each Guarantor will upon demand pay to the Collateral Agent
any and all reasonable sums, costs and expenses which the Collateral Agent may
pay or incur pursuant to the provisions of this Agreement or in negotiating,
executing, perfecting, defending, protecting or enforcing this Agreement or the
security interests granted herein or in enforcing payment of the Borrower
Obligations or the Guarantor Obligations or otherwise in connection with the
provisions hereof, including, but not limited to court costs, reasonable
collection charges, reasonable travel expenses, and reasonable attorneys' fees,
all of which, together with interest at the highest rate then payable on any of
the Borrower Obligations, shall be part of the Borrower Obligations.
20. Repayment in Bankruptcy, etc.
If, at any time or times subsequent to the payment of all or
any part of the Borrower Obligations or the Guarantor Obligations, the
Collateral Agent or any Secured Creditor shall be required to repay any amounts
previously paid by or on behalf of the Bor rower or any Guarantor in reduction
thereof by virtue of an order of any court having jurisdiction in the premises,
including, without limitation, as a result of an adjudication that such amounts
constituted preferential payments or fraudulent conveyances, the Guarantors
unconditionally agree to pay to the Collateral Agent within five days after
demand a sum in cash equal to the amount of such repayment, together with
interest on such amount from the date of such repayment by the Collateral Agent
or such Secured Creditor, as the case may be, to the date of payment to the
Collateral Agent at the applicable after-maturity rate set forth in the Credit
Agreements.
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21. No Segregation of Moneys; No Interest.
No moneys or any other Property received by the Collateral
Agent hereunder need be segregated in any manner except to the extent required
by law, and any such moneys or other Property may be deposited under such
general conditions as may be pre scribed by law applicable to the Collateral
Agent and the Collateral Agent shall not be liable for any interest thereon,
except as may otherwise be agreed by the Collateral Agent.
22. Guarantors
Upon the execution and delivery to the Collateral Agent of a
Supplement by any Person, appropriately acknowledged, such Person shall be a
Guarantor.
23. Subrogation
Each Guarantor hereby irrevocably and forever waives any right
to succeed to any of the rights of the Collateral Agent and the Secured
Creditors against the Borrower under this Agreement, whether by way of
subrogation or otherwise, until all Borrower Obligations have been indefeasibly
paid in full, in cash.
24. Continuing Security Interest; Termination; Partial Release.
(a) This Agreement shall create a continuing security interest
in the Collateral and shall (i) remain in full force and effect until the
indefeasible cash payment in full of the Borrower Obligations and the
termination of the Credit Agreements, (ii) be binding upon each Guarantor and
its successors and assigns and (iii) inure, together with the rights and
remedies of the Collateral Agent hereunder, to the benefit of the Collateral
Agent, any successor Collateral Agent and the Secured Creditors. A Guarantor's
successors and assigns shall include, without limitation, a receiver, trustee or
debtor-in-possession thereof or therefor.
(b) The Collateral Agent may release from the Lien created by
this Agreement any Instrument in connection with the consummation of an
acquisition of a Broadcasting Station permitted by the Credit Agreements to
which such Instrument relates.
25. Miscellaneous
(a) No failure by the Collateral Agent to exercise, and no
delay by the Collateral Agent in exercising, any right or remedy hereunder shall
operate as a waiver thereof.
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(b) Except as otherwise expressly provided in this Agreement,
to the maximum extent permitted by applicable law, each Guarantor hereby waives
presentment, demand for payment, notice of default, nonperformance and dishonor,
protest and notice of protest of or in respect of this Agreement, the other Loan
Documents, each Interest Protection Arrangement, and the Borrower Obligations,
notice of acceptance of this Agreement and reliance hereupon by the Collateral
Agent and each Secured Creditor, and the incurrence of any of the Borrower
Obligations, notice of any sale of collateral security or any default of any
sort.
(c) No Guarantor is relying upon the Collateral Agent or any
Secured Creditor to provide to such Guarantor any information concerning the
Borrower or any Subsidiary, and each Guarantor has made arrangements
satisfactory to such Guarantor to obtain from the Borrower on a continuing basis
such information concerning the Borrower and its Subsidiaries as such Guarantor
may desire.
(d) Each Guarantor agrees that any statement of account with
respect to the Borrower Obligations from the Collateral Agent or any Secured
Creditor to the Borrower which binds the Borrower shall also be binding upon
such Guarantor, and that copies of said statements of account maintained in the
regular course of the Collateral Agent's or such Secured Creditor's business, as
the case may be, may be used in evidence against such Guarantor in order to
establish its Guarantor Obligations.
(e) Each Guarantor acknowledges that it has received a copy of
the Loan Documents and each Interest Rate Protection Arrangement and has
approved of the same. In addition, such Guarantor acknowledges having read each
Loan Document and each such Interest Rate Protection Arrangement and having had
the advice of counsel in connection with all matters concerning its execution
and delivery of this Agreement.
(f) No Guarantor may assign any right, or delegate any duty,
it may have under this Agreement.
(g) Subject to the limitations set forth in Section 2(b), the
Guarantor Obligations shall be joint and several.
(h) This Agreement is the "Subsidiary Guaranty" referred to in
the Credit Agreements. Each of the Collateral Agent and the Guarantors
acknowledges that certain provisions of the Credit Agreements, including,
without limitation, Sections 1.2 (Principles
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of Construction), 11.1 (Amendments and Waivers), 11.3 (No Waiver; Cumulative
Remedies), 11.4 (Survival of Representations and Warranties), 11.7 (Successors
and Assigns), 11.8 (Counterparts), 11.13 (Headings), 11.14 (Severability), 11.15
(Integration), 11.16 (Consent to Jurisdiction), 11.17 (Service of Process),
11.18 (No Limitation on Service or Suit) and 11.19 (WAIVER OF TRIAL BY JURY)
thereof, are made applicable to this Agreement and all such provisions are
incorporated by reference herein as if fully set forth herein.
26. Governing Law; Terms.
This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to conflicts of
laws rules, except to the extent that the validity or perfection of the security
interest hereunder, or remedies hereunder, in respect of any particular
collateral are governed by the laws of a jurisdiction other than the State of
New York. Unless otherwise defined herein or in the Credit Agreements, terms
used in Articles 8 and 9 of the UCC are used herein as therein defined.
-22-
IN EVIDENCE of the agreement by the parties hereto to the terms and
conditions herein contained, each such party has caused this Agreement to be
duly executed on its behalf.
THE BANK OF NEW YORK, as Collateral
Agent
By:
Name:
Title:
AMERICAN RADIO SYSTEMS LICENSE
CORP.
By:
Name:
Title:
ARS ACQUISITION II, INC.
By:
Name:
Title:
RADIO SYSTEMS OF MIAMI, INC.
By:
Name:
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Title:
RADIO SYSTEMS OF PHILADELPHIA,
INC.
By:
Name:
Title:
-24-
ANNEX A TO SUBSIDIARY GUARANTY
FORM OF SUPPLEMENT
to
SUBSIDIARY GUARANTY, dated as of _______________, 1997, by and among the Guar
antors party thereto, and The Bank of New York, as Collateral Agent (as the same
may have been amended, supplemented or otherwise modified from time to time, the
"Guaranty").
[Date]
Capitalized terms used herein which are not otherwise defined herein
shall have the respective meanings ascribed thereto in the Guaranty. Pursuant to
Section 22 of the Guaranty, by execution and delivery of this Supplement and,
upon acceptance hereof by the Collateral Agent, the undersigned (a) shall be,
and shall be deemed to be, a "Guarantor" under, and as such term is defined in
the Guaranty, (b) shall have made, and shall be deemed to have made, the
representations and warranties contained in Section 7 of the Guaranty on and as
of the date hereof, and (c) shall have made, and shall be deemed to have made,
all of the covenants and agreements of a Guarantor set forth in the Guaranty.
Address for notices: [NAME OF GUARANTOR]
____________________ By:
____________________ Name:
____________________ Title:
Accepted and agreed to as
of the date first above
written:
THE BANK OF NEW YORK, as Collateral Agent
By:
Name:
Title:
Schedule 1
to
SUBSIDIARY GUARANTY
PART A - Pledged Capital Stock:
Name of Jurisdiction of Class;
Issuer Incorporation Par Value Shares Owned
PART B - Pledged Debt:
Debtor Date Face Amount Balance Due
- 2 -
Schedule 7(b)(i)
to
SUBSIDIARY GUARANTY
LIST OF NAMES; TRADENAMES
-3-
Schedule 7(b)(ii)
to
SUBSIDIARY GUARANTY
PART A - Chief Executive Office and Chief Place of Business:
PART B - Other Offices and Places of Business:
- 4 -
