Exhibit 10.8
LBI HOLDINGS I, INC.
FIRST AMENDMENT TO
SECURITIES PURCHASE AGREEMENT, WARRANT AGREEMENT
AND SUBORDINATION AND INTERCREDITOR AGREEMENTS
THIS FIRST AMENDMENT TO SECURITIES PURCHASE AGREEMENT, WARRANT AGREEMENT
AND SUBORDINATION AND INTERCREDITOR AGREEMENTS (this "Amendment") is dated as of
July 9, 2002 and entered into by and among LBI Holdings I, Inc., a California
corporation (the "Company"), the several purchasers (individually, a
"Purchaser," and collectively, the "Purchasers") listed on the signature pages
hereof, for purposes of Sections 3, 5, 7, 8A and 9 only, Fleet National Bank,
individually and as administrative agent for the lenders under the Senior Loan
Agreement dated as of July 9, 2002 ("Fleet"), and, for purposes of Sections 4,
7, 8A and 9 only, Oaktree Capital Management, LLC, individually and as agent for
the Senior Subordinated Lenders (as such term is defined in the Purchase
Agreement prior to giving effect to this Amendment) ("Oaktree").
This Amendment is made with reference to that certain Securities Purchase
Agreement dated as of March 20, 2001 and entered by and among the Company and
the Purchasers (the "Purchase Agreement"; as amended hereby, the "Amended
Purchase Agreement"), that certain Warrant Agreement dated as of March 20, 2001
and entered by and among the Company and the Purchasers (the "Warrant
Agreement"; as amended hereby, the "Amended Warrant Agreement"), that certain
Subordination and Intercreditor Agreement dated as of March 20, 2001 and entered
by and among the Company, the Purchasers and Fleet (the "Senior Lenders
Intercreditor Agreement"; as amended hereby, the "Amended Intercreditor
Agreement"), that certain Subordination and Intercreditor Agreement dated as of
March 20, 2001 and entered by and among the Company, the Purchasers and Oaktree
(the "Senior Subordinated Lenders Intercreditor Agreement"; as amended hereby,
the "Amended Subordinated Intercreditor Agreement"), and that Investor
Subordination Agreement dated as of March 20, 2001 and entered by and among the
Purchasers and Fleet (the "Investor Subordination Agreement"; as amended hereby,
the "Amended Investor Subordination Agreement" and together with the Amended
Purchase Agreement, the Amended Warrant Agreement, the Amended Intercreditor
Agreement and the Amended Subordinated Intercreditor Agreement, the "Amended
Agreements").
Capitalized terms used herein without definition shall have the same
meanings herein as set forth in the Purchase Agreement.
RECITALS
WHEREAS, the Company and the Purchasers have previously entered into the
Purchase Agreement and the Warrant Agreement, pursuant to which the Company sold
to the Purchasers (i) Notes in an original aggregate principal amount of
$30,000,000 and (ii) Warrants to purchase a certain number of shares of the
Company's Common Stock;
WHEREAS, certain subsidiaries of the Company desire to amend and restate
the existing Senior Loan Agreement and to refinance the existing Senior
Subordinated Loan Agreement by issuing publicly-traded senior subordinated notes
pursuant to an indenture;
WHEREAS, the obligations under the Notes will be subordinated to the
obligations under the publicly-traded senior subordinated notes and the Purchase
Agreement will be amended to insert certain provisions regarding subordination;
WHEREAS, the parties hereto desire to amend, to the extent they are a party
thereto, the Purchase Agreement, the Warrant Agreement and the Senior Lenders
Intercreditor Agreement on the terms and subject to the conditions contained
herein;
WHEREAS, the Company and the Purchasers desire to have the Company reissue
the Warrants and the Notes reflecting the changes set forth in this Amendment,
including the extension of the scheduled maturity date of the Notes to July 9,
2013 and the extension of the scheduled expiration date of the Warrants to
January 9, 2015;
WHEREAS, the Company, the Purchasers and Oaktree desire to amend the
existing Senior Subordinated Lenders Intercreditor Agreement to reflect the
payment in full of all principal and interest due on the subordinated notes held
by Oaktree;
WHEREAS, Fleet and the Purchasers desire to amend the Investor
Subordination Agreement.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
Section 1. AMENDMENTS TO THE PURCHASE AGREEMENT
1.1 Amendments to Article I: Definitions.
A. The definition of "Senior Loan Agreement" in Article I of the Purchase
Agreement is hereby amended by adding after the phrase "from time to time"
appearing in the fifth line thereof the phrase ", as amended and restated by the
Amended and Restated Credit Agreement dated as of July 9, 2002 among LBI Media,
as the borrower, the guarantors party thereto and Fleet National Bank, as
administrative agent, General Electric Capital Corporation and U.S. Bank, N.A.,
as co-syndication agents, and CIT Lending Services Corporation and SunTrust
Bank, as co-documentation agents, and the other lenders party thereto from time
to time."
B. Article I of the Purchase Agreement is hereby amended by deleting each
of the following definitions therefrom in their entirety and substituting the
following therefor:
"Maturity Date" means the earlier to occur of (i) July 9, 2013, (ii)
the acceleration of the obligations of the Company to the Purchasers under
the Notes in accordance with Article IX following the occurrence and
continuance of a Material Event of Default, (iii) a Sale of the Company,
(iv) [intentionally left blank] or (v) the date on which the Company
repurchases the Warrants pursuant to Section 5.2 of the Warrant Agreement.
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"Senior Subordinated Lenders" means the holders of notes from time to
time issued pursuant to the Senior Subordinated Loan Agreement.
"Senior Subordinated Lenders Intercreditor Agreement" means Article
XIX of this Agreement, as such provisions may be amended from time to time.
"Senior Subordinated Loan Agreement" means the Indenture, dated as of
July 9, 2002, among LBI Media, as the issuer, the guarantors party thereto
and U.S. Bank, N.A., as the trustee, and any other agreement governing
Indebtedness incurred to refund or refinance the borrowings and commitments
then outstanding or permitted to be outstanding under the Indenture, in
whole or in part, in each case together with any related notes, guarantees,
and collateral documents executed from time to time in connection
therewith, including that certain registration rights agreement dated as of
July 9, 2002 by and among LBI Media, the Senior Subordinated Note
Guarantors, and the initial purchasers party thereto for the benefit of the
Senior Subordinated Lenders, and in each case as amended, modified,
supplemented, extended, restated, renewed, refunded, restructured, replaced
or refinanced (in whole or in part), including any increase in the amount
of Indebtedness thereunder, from time to time, whether by the same or any
other agent, purchaser or group of purchasers.
C. Article I of the Purchase Agreement is hereby amended by adding each of
the following definitions thereto in appropriate alphabetical order:
"Agreement" means the Purchase Agreement, as amended from time to time.
"LBI Media" means LBI Media, Inc., a California corporation (formerly
known as LBI Holdings II, Inc.).
"Reorganization" means any distribution of the assets of any entity
upon any voluntary or involuntary dissolution, winding-up, total or partial
liquidation or reorganization, or bankruptcy, insolvency, receivership or
other statutory or common law proceedings or arrangements involving any
such party or the readjustment of the liabilities of any such party or any
assignment for the benefit of creditors or any marshaling of the assets or
liabilities of any such party.
"Senior Credit Satisfaction" means the repayment in full of all loans,
advances, extensions of credit and other fees and direct monetary
obligations (including, without limitation, interest which accrues after
the commencement of any proceeding in respect of any Reorganization), and
the termination of all commitments, under the Senior Loan Agreement.
"Senior Subordinated Notes" means the 10-1/8% Senior Subordinated
Notes due 2012 of LBI Media, together with any additional notes issued
pursuant to the Senior Subordinated Loan Agreement, including, but not
limited to, notes issued in exchange or replacement therefor, and any
refinancing, refunding or replacement of any of the foregoing.
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"Senior Subordinated Note Guarantors" means each of the direct and
indirect subsidiaries of LBI Media that are guarantors of the Senior
Subordinated Notes pursuant to the Senior Subordinated Loan Agreement.
"Senior Subordinated Note Obligations" means any and all principal,
interest, premium, penalty, fee, indemnification, reimbursements, damages,
including liquidated damages, and other indebtedness, obligations and
liabilities of LBI Media and the Senior Subordinated Note Guarantors to the
holders of the Senior Subordinated Notes, their successors and assigns, now
existing or hereafter arising, direct or indirect, absolute or contingent,
secured or unsecured, arising out of or in connection with the Senior
Subordinated Loan Agreement and any other document or instrument executed
in connection with the Senior Subordinated Notes, including any and all
interest payable pursuant to the Senior Subordinated Loan Agreement and the
Senior Subordinated Notes at the interest rates provided therein, any
premium payable in accordance with the terms of the Senior Subordinated
Loan Agreement and all other fees, expenses, and other amounts due from
time to time under the Senior Subordinated Loan Agreement and the Senior
Subordinated Notes.
"Senior Subordinated Notes Trustee" means the trustee under the Senior
Subordinated Loan Agreement.
"Subordinated Agreements" means this Agreement, the Warrant Agreement,
and the Voting and Co-Sale Agreement.
"Subordinated Indebtedness" means all existing and hereafter arising
indebtedness, obligations and liabilities of the Company, LBI Media and its
direct and indirect subsidiaries or the shareholders of the Company to the
Permitted Holders, whether direct or contingent, and all claims, rights,
causes of action, judgments and decrees in respect of the foregoing,
including, without limitation: (i) the Notes and any notes hereafter issued
by the Company to the Permitted Holders, including, without limitation, all
notes issued in respect of payment in kind interest, (ii) the Warrants and
all warrants hereafter issued pursuant to the Warrant Agreement, (iii) the
Subordinated Agreements and (iv) all obligations of the Company to
repurchase or redeem the Notes or the Warrants.
1.2 Amendments to Article II: Sale and Purchase of Purchased Securities
A. Section 2.4(a)(i) of the Purchase Agreement is hereby amended by adding
after the phrase "9% per annum" appearing in the second line thereof the phrase
"(or 13% per annum after September 20, 2009), in each case".
B. Section 2.4(a)(ii) of the Purchase Agreement is hereby amended by
deleting the reference to "September 20, 2009" contained therein and
substituting "July 9, 2013" therefor.
C. Section 2.4(h) of the Purchase Agreement is hereby amended by deleting
the phrase "or otherwise" in the fourth sentence contained therein.
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1.3 Amendments to Article VII: Affirmative and Negative Covenants
A. Section 7.1 of the Purchase Agreement is hereby amended by (i)
deleting the first reference to "under Sections 7.4, 7.16 and Article 8 of
the Senior Subordinated Loan Agreement, as such sections exist on the date
hereof" contained therein and substituting "or not prohibited under the
Senior Subordinated Loan Agreement," (ii) deleting the second reference to
"under Sections 7.4, 7.16 and Article 8 of the Senior Subordinated Loan
Agreement, as such sections exist on the date hereof" contained therein and
substituting "under Sections 4.10, 4.13, and Article 5 of the Senior
Subordinated Loan Agreement, as such sections exist on July 9, 2002" and
(iii) adding after the second sentence of such Section 7.1 the following
sentence:
"Notwithstanding the foregoing, LBI Intermediate Holdings, Inc. may
merge with and into LBI Media."
B. Section 7.2 of the Purchase Agreement is hereby amended by deleting
the reference to "Section 6.5 of the Senior Loan Agreement, as such section
exists as of the date hereof" contained therein and substituting "Section
6.5 of the Senior Loan Agreement, as such section exists as of July 9,
2002" therefor.
C. Section 7.5(i) of the Purchase Agreement is hereby amended by
deleting the phrase "on the date hereof" contained therein and substituting
therefor the phrase "on July 9, 2002, or Distributions between or among LBI
Media and/or any of its wholly-owned Subsidiaries."
D. Section 7.5(ii) of the Purchase Agreement is hereby amended by
inserting the phrase "or loans" after the phrase "those Distributions."
E. Section 7.5(iv) of the Purchase Agreement is hereby amended by
deleting the reference to "$10,000,000" contained therein and substituting
"$15,000,000" therefor.
F. Section 7.5 of the Purchase Agreement is hereby further amended by
inserting the following sentence at the end of such section:
"Notwithstanding any provision in Section 7.1 or this Section 7.5 to
the contrary, the Company and its wholly-owned Subsidiaries may cancel,
forgive or transfer loan receivables made under Section 7.5(ii) owing
to Company or any of its wholly-owned Subsidiaries from the Company's
shareholders and such cancellation, forgiveness or transfer shall not
be deemed as Distributions hereunder."
G. Section 7.6 of the Purchase Agreement is hereby further amended by
inserting the following parenthetical at the end of clause (a) after the
phrase "of the Company":
"(including without limitation any intercompany note issued by the
Company to any of its wholly-owned Subsidiaries in connection with
intercompany loans made by such wholly-owned Subsidiaries to the
Company)"
H. Section 7.7 of the Purchase Agreement is hereby amended by deleting
the second sentence thereof in its entirety and substituting the following
therefor:
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"If after July 9, 0000, Xxxxxx Xxxxxxxx, Xxxx Xxxxxxxx and/or their
Family Members shall loan or otherwise extend any credit to the Company
or its Subsidiaries (except for business expenses to be reimbursed by
the Company or its Subsidiaries in the ordinary course of business),
then, if requested by Majority Purchasers, such person shall enter into
a subordination agreement with the Purchasers subordinating such
person's loans to the Company and/or its Subsidiaries on terms
reasonably acceptable to Majority Purchasers, Senior Lenders and such
person, and which does not restrict any payment to such person that
would otherwise be permitted under the Senior Subordinated Loan
Agreement."
1.4 Amendment to Article VIII: Delivery of Information
A. The Purchase Agreement is hereby amended by deleting each reference
to "the Company" or "the Company's" appearing in Sections 8.1, 8.2, 8.3 and
8.4 thereof (other than (i) the second reference to "the Company" in such
Section 8.1, (ii) the first and third references to "the Company" in such
Section 8.2, (iii) the second reference to "the Company" (not including any
reference to the phrase "the Company's") in such Section 8.3, and (iv) the
first reference to "the Company" in such Section 8.4) and substituting
therefor in each instance the phrase "LBI Media" or "LBI Media's", as
applicable.
B. Section 8.1 of the Purchase Agreement is hereby further amended by
inserting the following paragraph at the end of such section:
"Within 120 days after the close of each fiscal year of the Company,
commencing with the fiscal year ending on December 31, 2002, the
Company will deliver to each Purchaser an unaudited consolidated
balance sheet and statement of income and retained earnings and of cash
flows of the Company and its Subsidiaries, which annual financial
statements shall show the financial condition of the Company as of the
close of such fiscal year and the results of the Company's operations
during such fiscal year, to be accompanied by an officer's certificate
as described in Section 8.3; provided, however, that in the event the
Company engages in any activities beyond the activities as permitted by
Section 7.15 of the Senior Loan Agreement as such provision is in
effect on July 9, 2002, then the Purchasers shall be entitled to
request and receive the audited financial statements for Company and
its Subsidiaries (rather than LBI Media and its Subsidiaries) under
this Section."
1.5 Amendment to Article IX: Defaults
A. Subsection (e) of Article IX of the Purchase Agreement is hereby
amended by deleting the reference to "Sections 6.1, 6.2 and 6.6 of the
Senior Loan Agreement, as such provisions are in effect on the date hereof"
contained therein and substituting "Sections 6.1, 6.2 and 6.6 of the Senior
Loan Agreement, as such provisions are in effect on July 9, 2002" therefor.
B. Subsection (l) of Article IX of the Purchase Agreement is hereby
amended by deleting therefrom the phrase "and Requisite Holders (as defined
in the Senior Subordinated Loan Agreement)."
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1.6 Addition of New Article XIX: Subordination
The Purchase Agreement is hereby amended by adding after Article XVIII
thereof a new Article XIX as follows:
"Section 19.1 Payment and Performance Subordinated. Notwithstanding
anything to the contrary in the Subordinated Agreements, the Notes or the
Warrants, but subject to Section 19.4, for so long as any of the Senior
Subordinated Notes are outstanding, the payment and performance of the
Subordinated Indebtedness is, and shall expressly be, subordinate and junior in
right of payment and exercise of remedies to the prior payment in full in cash
of the Senior Subordinated Note Obligations to the extent and in the manner
provided in this Article XIX, and the Subordinated Indebtedness is hereby
subordinated as a claim against the Company, LBI Media, any of their direct or
indirect subsidiaries and the Senior Subordinated Note Guarantors and any of the
assets of, or ownership interests in, such parties whether such claim be in the
event of any Reorganization or otherwise. In furtherance of the foregoing, the
Company will not make, and the Permitted Holders will not demand, accept or
receive, any payment of interest, principal or any payment in respect of the
Subordinated Indebtedness, including, without limitation, any amounts in
connection with a put of the Warrants pursuant to the Warrant Agreement, or
otherwise in respect of the Subordinated Indebtedness, until all of the Senior
Subordinated Note Obligations have been indefeasibly paid in full in cash,
except as permitted pursuant to Section 19.4 hereof. All Senior Subordinated
Note Obligations shall be entitled to the benefits of this Article XIX without
notice thereof being given to any holder of Subordinated Indebtedness.
Section 19.2 Distribution in Reorganization.
(a) In the event of any Reorganization relative to the Company, LBI
Media or any of their direct and indirect subsidiaries or any of their
respective properties, all of the Senior Subordinated Note Obligations shall
first be paid in full in cash before any payment on account of principal,
premium or interest or otherwise is made upon or in respect of the Subordinated
Indebtedness, and in any such proceedings any payment or distribution of any
kind or character, whether in cash or property or securities which may be
payable or deliverable in respect of the Subordinated Indebtedness shall, after
Senior Credit Satisfaction, be paid or delivered to the Senior Subordinated
Notes Trustee for application in payment of the Senior Subordinated Note
Obligations, unless and until all such Senior Subordinated Note Obligations
shall have been paid and satisfied in full in cash.
(b) Each Permitted Holder, for itself and its heirs, legatees,
successors and assigns, hereby irrevocably authorizes and directs the Senior
Subordinated Notes Trustee and any trustee in bankruptcy, receiver, custodian or
assignee for the benefit of creditors of any of the Company, LBI Media or any of
their direct and indirect subsidiaries, whether in voluntary or involuntary
liquidation, dissolution or reorganization, on its behalf to take such action as
may be necessary or appropriate to effectuate the subordination provided for in
this Article XIX and irrevocably appoints, which appointment is coupled with an
interest, upon any Default or Event of Default under the Senior Subordinated
Loan Agreement and during the continuance thereof and upon any failure to comply
with the terms of this Article XIX, the Senior Subordinated Notes Trustee,
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or any such trustee, receiver, custodian or assignee, its attorneys-in-fact for
such purpose with full powers of substitution and revocation.
(c) Notwithstanding the foregoing provisions of this Section 19.2, the
Permitted Holders shall be entitled to receive and retain any securities of the
Company provided for by a plan of reorganization or readjustment or the like,
the payment of which securities is subordinate, at least to the extent provided
in this Article XIX, with respect to the Subordinated Indebtedness, to the
payment of all Senior Subordinated Note Obligations.
Section 19.3 Effect of Provisions. The provisions of Article XIX as to
subordination are solely for the purpose of defining the relative rights of the
holders of Senior Subordinated Note Obligations, on the one hand, and the
Permitted Holders, on the other hand, and none of such provisions shall impair,
as between the Company and the Permitted Holders, the obligations of the Company
to pay to the Permitted Holders in accordance with the terms of the Senior
Subordinated Note Obligations, nor, except as provided in Section 19.7 below,
shall any such provisions prevent the Permitted Holders from exercising all
rights and remedies otherwise permitted by applicable law or under the terms of
the applicable Subordinated Agreements upon a default thereunder or otherwise,
subject to the rights, if any, of the holders of Senior Subordinated Note
Obligations under the provisions of this Article XIX.
Section 19.4 Permitted Payments of Subordinated Indebtedness.
(a) The Company may issue additional Notes to the Permitted Holders as
payment in kind for interest accrued on the Notes in accordance with the terms
of this Agreement, and the Company may issue additional Warrants (or adjust the
number of shares of equity securities underlying Warrants) to the Permitted
Holders in accordance with the Warrant Agreement. Each such additional Note
shall have payment terms (including, without limitation, maturity date and the
absence of any scheduled payments of principal, interest or other amounts prior
to such maturity date) identical to the Notes and shall otherwise be
substantially identical to the Notes, except for any differences in the
principal amount of any such additional Note. Each such additional Warrant shall
have payment terms (including, without limitation, any terms relating to any put
or redemption thereof) identical to the Warrants and shall otherwise be
substantially identical to the Warrants, except for any differences in the
purchase price thereof or the number of shares of Common Stock of the Company
which may be purchased upon exercise thereof. If the Company issues any
additional Note or Warrant pursuant to this Section 19.4(a), such delivery shall
be deemed to constitute a representation of the Company to the holders of Senior
Subordinated Note Obligations and the Permitted Holders that such issuance is
not prohibited under this Article XIX. Until all Senior Subordinated Note
Obligations have been paid in full, the Company shall not issue any instrument,
security or other writing evidencing any part of the Subordinated Indebtedness,
except the additional Notes and additional Warrants that are permitted to be
issued pursuant to this Section 19.4(a). The Permitted Holders shall not assign
or subordinate any part of the Subordinated Indebtedness except in accordance
with this Article XIX.
(b) The Company may pay the Permitted Holders and the Permitted Holders
may accept and retain (i) payments of accrued interest on the Notes on (but in
no event prior to) the scheduled maturity date (determined without giving effect
to any acceleration of such date
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pursuant to the Subordinated Agreements or otherwise) at a per annum rate not
exceeding the rate at which interest is stated to accrue under Section 2.4 of
this Agreement in the absence of a default under any of the Subordinated
Agreements, unless at the time of such proposed payment or immediately after
giving effect thereto, there shall exist any Event of Default under the Senior
Subordinated Loan Agreement (as defined therein), (ii) payments of principal
under the Notes on (but in no event prior to) the scheduled maturity date
(determined without giving effect to any acceleration of such date pursuant to
the Subordinated Agreements or otherwise) in the amounts required to be paid
thereunder on such maturity date, unless at the time of such proposed payment or
immediately after giving effect thereto, there shall exist any Event of Default
under the Senior Subordinated Loan Agreement (as defined therein), (iii) the
redemption of the Notes and/or the repurchase of the Warrants (or any equity
interests of the Company issued to the holder thereof in lieu of, or in
connection with, the exercise of such Warrants) and/or the payment of any
interest or any other obligation under the Subordinated Agreements, the Notes or
the Warrants with (1) proceeds received from LBI Media or any of its
Subsidiaries (in the form of dividends, distributions or loans) so long as the
payment or the making of such dividend, distribution, or loan to the Company by
LBI Media or any of its Subsidiaries is not prohibited by the Senior
Subordinated Loan Agreement or (2) proceeds received by the Company (other than
from LBI Media or any of its Subsidiaries) from the sale of any equity
securities of the Company, and (iv) payments required to be made by the Company
under Section 12.1 of this Agreement for certain fees and expenses (including
legal fees), in each case as and at the times when such reimbursements are due
and payable thereunder. If any holder of Subordinated Indebtedness receives
payment or reimbursement from the Company in accordance with clause (i) or (ii)
of the immediately preceding sentence, such payment shall be deemed to
constitute a representation of the Company to the Senior Subordinated Notes
Trustee and the holders of the Senior Subordinated Notes that no Event of
Default under the Senior Subordinated Loan Agreement exists, and that such
payment is permitted to be paid by the Company under this Article XIX; and the
Permitted Holders shall be entitled to keep and retain such payment unless,
prior to the Clawback Date (as hereinafter defined) the Senior Subordinated
Notes Trustee shall have notified the Company and LBI Media, who shall in turn
notify the Permitted Holders in writing of an Event of Default, in which case
(if such Event of Default in fact existed on the date of such payment) the
Permitted Holders shall forthwith deliver such payment or an amount of cash
equal thereto to the Senior Subordinated Notes Trustee for application in
payment of the Senior Subordinated Note Obligations.
(c) As used in this Article XIX, the term "Clawback Date" shall mean
(i) with respect to any payment default, 60 days after the occurrence thereof
and (ii) with respect to any other Event of Default, 60 days after the Senior
Subordinated Notes Trustee and holders of the Senior Subordinated Notes knew or,
in the exercise of reasonable diligence, should have known, of such Event of
Default.
(d) Notwithstanding anything herein or in the Subordinated Agreements
to the contrary, until such time as all Senior Subordinated Note Obligations
have been indefeasibly paid in full in cash, (i) the Company will not make, and
the Permitted Holders will not demand, accept or receive, any payments of cash
under the Subordinated Agreements (including, without limitation, the Notes or
the Warrants (including amounts in respect of a put or repurchase of the
Warrants)) or otherwise in respect of the Subordinated Indebtedness, except as
expressly permitted by Section 19.4(b), and (ii) the Company will not make, and
the Permitted Holders
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will not demand, accept or receive any payment of any other assets of any kind
under the Subordinated Agreements or otherwise in respect of the Subordinated
Indebtedness, except for the additional Notes and Warrants issued in accordance
with Section 19.4(a).
Section 19.5 Agreement to Hold in Trust; Defense to Enforcement. If
any holder of Subordinated Indebtedness shall receive any payment on account of
the Subordinated Indebtedness in violation of this Article XIX, it shall, after
Senior Credit Satisfaction, hold such payment in trust for the benefit of the
holder or holders of the Senior Subordinated Note Obligations and pay it over to
the Senior Subordinated Notes Trustee for application in payment of the Senior
Subordinated Note Obligations. If any holder of Subordinated Indebtedness, in
contravention of the terms of this Article XIX, shall commence, prosecute or
participate in any suit, action or proceeding against the Company, then the
Company may interpose as a defense or plea the making of this Article XIX and
the Senior Subordinated Notes Trustee may intervene and interpose such defense
or plea in its name or in the name of the Company. If any holder of Subordinated
Indebtedness, in contravention of the terms of this Article XIX, shall attempt
to collect any of the Subordinated Indebtedness or enforce any of the
Subordinated Agreements, the Notes or the Warrants, then the Senior Subordinated
Notes Trustee or the Company may, by virtue of this Article XIX, restrain the
enforcement thereof in the name of the Senior Subordinated Notes Trustee and
holders of the Senior Subordinated Note Obligations or in the name of the
Company. If any holder of Subordinated Indebtedness, in contravention of this
Article XIX, obtains any cash or assets of the Company, LBI Media or any of its
direct or indirect subsidiaries as a result of any administrative, legal or
equitable actions, or otherwise, after Senior Credit Satisfaction, such holder
agrees forthwith to pay, deliver and assign to the Senior Subordinated Notes
Trustee, for the benefit of the holders of Senior Subordinated Note Obligations
and the Senior Subordinated Notes Trustee, with appropriate endorsements, any
such cash for application to the Senior Subordinated Note Obligations and any
other assets as collateral for the Senior Subordinated Note Obligations.
Section 19.6 No Security to the Permitted Holders. The Company shall
not grant, and shall not permit any of its direct or indirect subsidiaries to
grant, and no Permitted Holder shall accept, any security of any nature in
property, real or personal, of the Company or any of its direct or indirect
subsidiaries to secure Subordinated Indebtedness. Any security interest granted
in violation of the terms of this Article XIX shall be null and void and of no
force and effect against the holders of the Senior Subordinated Note
Obligations.
Section 19.7 Limit on Right of Action.
(a) The Permitted Holders agree for the benefit of the holders of the
Senior Subordinated Note Obligations that so long as any Senior Subordinated
Notes or any other part of the Senior Subordinated Note Obligations remains
outstanding, but subject to Section 19.4, the Permitted Holders will not,
directly or indirectly, take any action to accelerate or demand payment by the
Company of the Subordinated Indebtedness (including any put of the Warrants
pursuant to the Warrant Agreement), to exercise any of its remedies in respect
of the Subordinated Indebtedness (including any requirement to change the
composition of the Board of Directors of the Company or to cause a "Sale of the
Company" (as defined in the Voting and Co-Sale Agreement) pursuant to the Voting
and Co-Sale Agreement), whether pursuant to any Subordinated Agreement, the
Notes, the Warrants or otherwise, or in respect of any guarantee of
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payment thereof, to initiate any litigation against the Company or any of its
direct or indirect subsidiaries or to foreclose or otherwise realize on any
security given by the Company or any other person to secure the Subordinated
Indebtedness prior to the earlier of (i) a Reorganization of the Company or (ii)
180 days after the receipt by the Senior Subordinated Notes Trustee of written
notice of intent to take any such action by the percentage of the Permitted
Holders required to authorize such action under this Agreement, provided that
(x) such notice is given during the continuance of a Material Event of Default
caused by the failure of the Company to make a payment permitted to be made
under clause (i) or (ii) of Section 19.4(b) hereof and (y) any proceeds received
or recoverable by the Permitted Holders in connection therewith shall be subject
to the other provisions of this Article XIX. Notwithstanding anything herein to
the contrary, the Permitted Holders will neither commence nor join with any
other creditor or creditors of the Company or any of its direct or indirect
subsidiaries in commencing any bankruptcy, reorganization or insolvency
proceedings against the Company or any such subsidiary.
Notwithstanding the foregoing, in the event of a material breach by the
Company of any material covenant contained in this Agreement, the Warrant
Agreement or Voting and Co-Sale Agreement, the Permitted Holders may seek
injunctive relief and state a claim for damages; provided, however, that the
Permitted Holders shall not be entitled to collect or receive any monetary
damages in respect of such claim from the Company or any of its subsidiaries in
connection with such material breach except in accordance with the first
sentence of this Section 19.7.
(b) The Permitted Holders shall not amend or permit amendment of the
terms of any instrument or agreement evidencing any Subordinated Indebtedness
(including, without limitation, the Subordinated Agreements, the Notes or the
Warrants), the effect of which is to (i) increase principal, interest, fees,
reimbursements or other amounts payable with respect thereto or create any
additional payment obligations thereunder, (ii) accelerate any scheduled or
otherwise required payments of principal, interest, fees, reimbursements or
other amounts, (iii) cause any covenants or other agreements to be more
restrictive upon, or burdensome to, the Company and its Subsidiaries, (iv) alter
any event of default or put provisions contained in the Subordinated Agreements,
the Notes or the Warrants (other than any alterations in favor of the Company
that are permitted under the Senior Subordinated Loan Agreement) or (v) make any
other change which materially adversely affect the interests of the holders of
Senior Subordinated Note Obligations, without the prior written consent of the
Senior Subordinated Notes Trustee.
Section 19.8 Senior Loan Agreement. Reference is made herein to the
Amended and Restated Credit Agreement dated as of July 9, 2002 by and among LBI
Media, the guarantors party thereto and the lenders party thereto (together with
successors and assignees and lenders party to any other Senior Loan Agreement,
the "Senior Credit Parties") (such Amended and Restated Credit Agreement, and
any amendment, restatement, renewal, refunding, refinancing or replacement
thereto, including, without limitation, any such change to the Amended and
Restated Credit Agreement which increases the amount of indebtedness thereunder
(the "Senior Loan Agreement"). Notwithstanding anything herein to the contrary,
to the extent the rights of holders of Senior Subordinated Note Obligations or
obligations of the Permitted Holders hereunder directly conflict with the rights
of the Senior Credit Parties, the Senior Credit Parties
11
shall have priority over and supersede the obligations hereunder; provided,
that, upon satisfaction of such conflicting rights and/or obligations under the
Senior Loan Agreement and the intercreditor agreement relating thereto, the
holders of Senior Subordinated Note Obligations may promptly exercise their
rights, and the Permitted Holders shall promptly satisfy their obligations under
this Article XIX.
Section 19.9 Rights of Holders of Senior Subordinated Notes to Amend
Senior Subordinated Loan Agreement and Discontinue Senior Subordinated Note
Obligations. The holders of Senior Subordinated Note Obligations may, in their
sole discretion, and without notice to the Permitted Holders, modify, amend,
waive or release any of the terms of the Senior Subordinated Loan Agreement, or
any other document or agreement at any time executed by LBI Media or any of the
Senior Subordinated Notes Guarantors or any other person in connection with the
Senior Subordinated Note Obligations and may exercise or refrain from exercising
any powers, remedies or rights which any such holder may have thereunder, and
such modification, amendment, waiver, release, exercise or failure to exercise
shall not affect any of such holders' rights under this Article XIX. Each
Permitted Holder hereby agrees that the holders of Senior Subordinated Note
Obligations may from time to time in their sole discretion amend the Senior
Subordinated Loan Agreement and any other instrument or agreement evidencing the
Senior Subordinated Note Obligations, grant extensions of time of payment or
performance and make compromises and settlements with LBI Media and the Senior
Subordinated Notes Guarantors and other creditors of LBI Media and the Senior
Subordinated Notes Guarantors without affecting the agreements of the Permitted
Holders and the Company hereunder. If at any time hereafter, the holders of
Senior Subordinated Note Obligations shall, in their sole discretion, determine
to discontinue the extension of credit to LBI Media or demand payment of the
Senior Subordinated Note Obligations, it may do so without notice to the
Permitted Holders. The failure on the part of the holders of Senior Subordinated
Note Obligations to insist on the strict performance of any term, condition or
other provision of this Article XIX or any term, condition or other provision
contained in the Senior Subordinated Loan Agreement or any other document or
instrument evidencing the Senior Subordinated Note Obligations, or to exercise
any right or remedy hereunder or thereunder, shall not affect or alter this
Article XIX, the Senior Subordinated Loan Agreement or any other such document
or instrument, and each and every term, condition and other provision of this
Article XIX, the Senior Subordinated Notes, and the Senior Subordinated Loan
Agreement shall, in such event, continue in full force and effect and shall be
operative with respect to any other then existing or subsequent default or event
of default in connection therewith.
Section 19.10 Third Party Beneficiaries. The holders of Senior
Subordinated Note Obligations and their respective successors and assigns and
the Senior Subordinated Notes Trustee are third party beneficiaries of this
Article XIX.
Section 19.11 No Transfer. A Permitted Holder may sell or transfer any
of the Subordinated Indebtedness, including, without limitation, the Notes and
the Warrants, to an Eligible Fund (as hereinafter defined) of such Permitted
Holder, provided that no such sale or other transfer of any Subordinated
Indebtedness shall be effective unless and until (i) the proposed transfer is in
accordance with Article XI, (ii) the proposed transferee shall agree in writing
pursuant to an agreement in form and substance acceptable to the Senior
Subordinated Notes Trustee to become a party hereto, and (iii) such sale or
other transfer is effected in
12
accordance with the Subordinated Agreements. As used herein, "Eligible Fund"
means, with respect to any Permitted Holder that is a fund that invests in
commercial loans or subordinated indebtedness, any other fund that invests in
commercial loans or subordinated indebtedness and is managed by the same
investment manager as such Permitted Holder.
Section 19.12 Amendment of Article XIX. No amendment shall be made to
this Article XIX which would materially adversely affect the interests of the
holders of Senior Subordinated Note Obligations, without the prior written
consent of the Senior Subordinated Notes Trustee."
1.7 Modification of Schedules
A. Schedule 3.4(b) to the Purchase Agreement is hereby amended by
deleting the reference to "April 1, 1999" with respect to the Xxxxx Employment
Agreement contained therein and substituting "September 1, 1999" therefor.
B. Schedule 3.7 to the Purchase Agreement is hereby amended by deleting
the existing schedule in its entirety and substituting the Schedule 3.7 attached
to this Amendment therefor.
C. Schedule 7.6 to the Purchase Agreement is hereby amended by (i)
adding at the end of each of items 4 and 5 thereof the following: "All amounts
owing thereunder may be paid in full on or about July 9, 2002," and (ii) adding
at the end of such Schedule 7.6 the following:
"7. Loans by Company or its Subsidiaries (on such terms as determined
by the sole and absolute discretion of Company or its Subsidiaries) to
Xxxx Xxxxxxxx and/or Xxxxxx Xxxxxxxx (and their respective Family
Members) in an aggregate amount not exceeding $5,000,000; provided that
no cancellation, foregiveness or transfer of any such loans shall
increase the aggregate amount of loans otherwise permitted hereunder.
8. The making of any loans described in Section 7.5(ii) (the terms of
which shall be determined in the sole discretion of the Company) and
cancellation, foregiveness or transfer of such loan."
1.8 Substitution of Exhibit
The Purchase Agreement is hereby amended by adding thereto a new
Exhibit A in the form of Annex A to this Amendment.
1.9 Amendment of Recitals
The first paragraph of the Purchase Agreement is hereby amended by
deleting the parenthetical "(the "Agreement")" contained therein.
13
Section 2. AMENDMENTS TO THE WARRANT AGREEMENT
2.1 Amendment to Section 7: Interpretation of this Agreement
A. The definition of "Consolidated EBITDA" in Section 7.1 of the
Warrant Agreement is hereby amended by deleting the reference therein to "Net
Cash Proceeds" and substituting "Net Cash Payments" therefor.
B. The definition of "Corporate Overhead Expense" in Section 7.1 of
the Warrant Agreement is hereby amended by adding at the end thereof the
following: "(it being understood that loans by Company or any of its
Subsidiaries to Xxxxxx or Xxxx Xxxxxxxx shall not constitute compensation to
Xxxxxx or Xxxx Xxxxxxxx)."
C. The definition of "Expiration Date" in Section 7.1 of the Warrant
Agreement is hereby amended by deleting the reference to "March 20, 2011"
contained therein and substituting "January 9, 2015" therefor.
2.2 Substitution of Exhibit
The Warrant Agreement is hereby amended by adding thereto a new Exhibit
A in the form of Annex B to this Amendment.
Section 3. AMENDMENTS TO THE SENIOR LENDERS INTERCREDITOR AGREEMENT
3.1 Amendment to Section 1: Certain Definitions
Section 1.1 of the Senior Lenders Intercreditor Agreement is hereby
amended by deleting the phrase "as amended, restated" appearing in the seventh
line thereof and substituting therefor the phrase "as amended and restated by
the Amended and Restated Credit Agreement dated as of July 9, 2002 among LBI
Media, Inc. (formerly known as LBI Holdings II, Inc.), as the borrower, the
guarantors party thereto, and Fleet National Bank, as administrative agent,
General Electric Capital Corporation and U.S. Bank, N.A., as co-syndication
agents, and CIT Lending Services Corporation and SunTrust Bank, as
co-documentation agents, and the other lenders party thereto from time to time,
as further amended, amended and restated,".
3.2 Amendments to Section 3: Terms of Subordination
Section 3.6(b) of the Senior Lenders Intercreditor Agreement is hereby
amended by (i) deleting each of the two references to "September 20, 2009"
contained therein and substituting therefor in each instance the phrase "July 9,
2013", and (ii) deleting each of the two references to "(as in effect on the
date hereof)" appearing in clauses (i) and (ii) thereof and substituting
therefor in each instance the phrase "(as in effect on July 9, 2002)".
14
3.3 Amendment to Section 8: Limit on Right of Action
Section 8(a) of the Senior Lenders Intercreditor Agreement is hereby
amended by adding at the end thereof the following:
"Notwithstanding the foregoing, in the event of a material breach by
the Company of (i) any covenant set forth in the following sections of
the Subordinated Investment Agreement, namely Section 2.4(h), the
second and third sentences of Section 7.1, Section 7.5, Section 7.6,
Section 7.7, Sections 8.1 through 8.8 or (ii) any material covenant
contained in the Warrant Agreement or Voting and Co-Sale Agreement, the
Subordinated Creditors may seek injunctive relief and state a claim for
damages; provided, however, that the Subordinated Creditors shall not
be entitled to collect or receive any monetary damages in respect of
such claim from the Company or any of its subsidiaries in connection
with such material breach except in accordance with the first sentence
of this Section 8(a). Prior to seeking any such injunctive relief or
stating any such claims, the Subordinated Creditors shall first deliver
notice thereof to the Administrative Agent at least thirty (30) days,
or shorter period if required by reason of a limitation period, filing
requirement or like matter, prior to taking any such action."
Section 4. AMENDMENT OF THE SENIOR SUBORDINATED LENDERS INTERCREDITOR
AGREEMENT
A. The parties acknowledge and understand that upon the payment of
amounts set forth in Section 1.1B of that certain Agreement Relating to Note
Purchase Agreement dated as of June 28, 2002 by and among LBI Intermediate
Holdings, Inc., the several purchasers listed on the signature pages thereof,
and Oaktree, which payment shall be made on or prior to the Amendment Effective
Date, the outstanding amounts owed by the Company under the existing Senior
Subordinated Loan Agreement with Oaktree and related notes shall be repaid in
full.
B. Section 1.1 of the existing Senior Subordinated Lenders
Intercreditor Agreement among the Company, the Purchasers, and Oaktree is hereby
amended by deleting the first sentence contained therein and substituting the
following therefor:
"Reference is made herein to the Notes Purchase Agreement of even date
herewith, by and among LBI Intermediate Holdings, Inc. (the
"Borrower"), the Purchasers party thereto, and the Agent (as amended
and supplemented from time to time, the "Notes Purchase Agreement"; it
being understood by the parties hereto that the term Note Purchase
Agreement shall not include any agreement entered into to refund,
refinance, or otherwise replace amounts owed under the Notes Purchase
Agreement and in no event shall include the Indenture, dated as of July
9, 2002, among LBI Media, Inc., as the issuer, the guarantors party
thereto and U.S. Bank, N.A., as the trustee or any documents related
thereto)."
Section 5. AMENDMENT OF THE INVESTOR SUBORDINATION AGREEMENT
Section 1 of the Investor Subordination Agreement is hereby amended by
inserting the phrase "and restated by the Amended and Restated Credit Agreement
dated as of July 9, 2002 among LBI Media, Inc. (formerly known as LBI Holdings
II, Inc.), as the borrower, the
15
guarantors party thereto, and Fleet National Bank, as administrative agent,
General Electric Capital Corporation and U.S. Bank, N.A., as co-syndication
agents, and CIT Lending Services Corporation and SunTrust Bank, as
co-documentation agents, and the other lenders party thereto from time to time,
and as further amended" into the second parenthetical contained in the first
sentence and immediately following the phrase "as amended."
Section 6. EXCHANGE OF NOTES AND WARRANTS
On or after the Amendment Effective Date and upon surrender of each
existing Note and existing Warrant held by each Purchaser, the Company agrees to
execute and deliver to such Purchaser a new Note in the form of Annex A to this
Amendment and a new Warrant in the form of Annex B to this Amendment, in each
case with appropriate insertions reflecting the same amounts as the existing
Note and Warrant. In such exchange, the parties agree that no commission or
other remuneration will be paid or given directly or indirectly for soliciting
such exchange.
On and after the Amendment Effective Date, any existing Notes and
existing Warrants outstanding and not exchanged pursuant to this Section 6 shall
be deemed to have such terms and conditions as set forth in the new form of Note
set forth in Annex A and the new form of Warrant set forth in Annex B.
Section 7. CONDITIONS TO EFFECTIVENESS
Sections 1, 2, 3, 4, 5, 6, and 9F of this Amendment shall become
effective only upon the satisfaction of all of the following conditions
precedent (the date of satisfaction of such conditions being referred to herein
as the "Amendment Effective Date"):
A. On or before the Amendment Effective Date, each of Company, Fleet,
Oaktree, and Majority Purchasers shall have delivered to the Company and to Alta
Communications VIII, L.P., as agent for each of the Purchasers, executed copies
of this Amendment.
B. LBI Media shall have simultaneously issued the Senior Subordinated
Notes under the Senior Subordinated Loan Agreement (as defined in Section 1.1C
hereof) and the new Senior Loan Agreement dated as of July 9, 2002 shall have
become effective.
C. The Purchasers shall have received an opinion of O'Melveny & Xxxxx
LLP, counsel to the Company, substantially in the form attached as Annex C.
D. The Company shall have received an opinion of Xxxxxxx & Xxxxxx, LLP,
counsel to Alta Communications VIII, L.P. and certain affiliates thereof,
substantially in the form attached as Annex D.
E. The new Senior Loan Agreement and related documents and the new
Senior Subordinated Loan Agreement and related documents shall be in form and
substance reasonably satisfactory to Majority Purchasers.
16
Section 8. REPRESENTATIONS AND WARRANTIES
A. By All Parties. In order to induce each of the other parties hereto
to enter into this Amendment, each party hereto represents and warrants to each
of the other parties hereto that the following statements are true, correct and
complete:
(i) Corporate Power and Authority. Such party has all requisite
corporate or partnership power and authority to enter into this
Amendment and to carry out the transactions contemplated by, and
perform its obligations under, this Amendment and the Amended
Agreements.
(ii) Authorization of Agreements. The execution and delivery of
this Amendment and the performance of this Amendment and the Amended
Agreements have been duly authorized by all necessary corporate or
partnership action on the part of such party.
(iii) No Conflict. The execution and delivery by such party of
this Amendment and the performance by such party of this Amendment and
the Amended Agreements do not and will not (i) violate any provision
of any law or any governmental rule or regulation applicable to such
party, the articles and bylaws or the partnership agreement or any
other organizational documents of such party, or any order, judgment
or decree of any court or other agency of the government of the United
States binding on such party, (ii) conflict with, result in a breach
of or constitute (with due notice or lapse of time or both) a default
under any material contractual obligation of such party, (iii) result
in or require the creation or imposition of any Lien upon any of the
properties or assets of such party, or (iv) require any approval of
stockholders or any approval or consent of any Person under any
contractual obligation of such party, except where applicable
approvals or consents have been obtained.
(iv) Governmental Consents. The execution and delivery by such
party of this Amendment and the performance by such party of this
Amendment and the Amended Agreements do not and will not require any
registration with, consent or approval of, or notice to, or other
action to, with or by, any U.S. federal, state, provincial or other
governmental authority or regulatory body.
(v) Binding Obligation. This Amendment has been duly executed
and delivered by such party and this Amendment and the Amended
Agreements are the legally valid and binding obligations of such party
enforceable against such party in accordance with their respective
terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally or by equitable principles relating to
enforceability.
B. By the Company. In order to induce the Purchasers to enter into this
Amendment, the Company represents and warrants to each of the Purchasers that
the following statements are true, correct and complete:
(i) The representations and warranties of the Company and its
Subsidiaries made in Sections 3.3, 3.4, and 3.7 of the Purchase
Agreement as of the Amendment
17
Effectiveness Date (which representations and warranties are subject to
all of the qualifications, limitations and restrictions contained in
the Purchase Agreement and any revised schedule attached to this
Amendment); and
(ii) The representations and warranties of the Company and its
Subsidiaries made in the amended and restated Senior Loan Agreement as
of the Amendment Effectiveness Date (which representations and
warranties are subject to all of the qualifications, limitations and
restrictions contained in the amended and restated Senior Loan
Agreement);
are hereby incorporated herein by reference and each such representation and
warranty is restated and re-made by the Company to the Purchasers as of the date
hereof and will be deemed to be representations and warranties made by the
Company to the Purchasers under this Amendment and relied upon by the Purchasers
in entering into this Amendment.
C. By the Purchasers. In order to induce each of the other parties
hereto to enter into this Amendment, each Purchaser hereto represents and
warrants to each of the other parties hereto that the following statements are
true, correct and complete: (i) the execution by the Majority Purchasers of this
Amendment constitutes the requisite approval of the Purchasers necessary to
amend the Amended Agreements as contemplated by this Amendment, including but
not limited to approval as "Majority Purchasers" under the Purchase Agreement
and the "Required Holders" under the Warrant Agreement; (ii) with such approval,
each Purchaser is bound by this Amendment, whether or not such Purchaser is a
party hereto; and (iii) collectively, Alta Communications VIII, L.P., Alta-Comm
VIII S By S, LLC, Alta Communications VIII-B, L.P., and Alta VIII Associates,
LLC constitute "Majority Purchasers" under the Purchase Agreement and "Required
Holders" under the Warrant Agreement.
Section 9. MISCELLANEOUS
A. Headings. Section and subsection headings in this Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Amendment for any other purpose or be given any substantive effect.
B. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE COMMONWEALTH OF MASSACHUSETTS, WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES.
C. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document.
D. Expenses. The Company acknowledges that all costs, fees and expenses
as described in Section 12.1 of the Purchase Agreement incurred by the
Purchasers and one counsel for the
18
Purchasers with respect to this Amendment and the documents and transactions
contemplated hereby shall be for the account of the Company. The Company shall
concurrently with the execution and delivery of this Amendment pay all accrued
and unpaid fees of Xxxxxxx & Xxxxxx, LLP, counsel to the Purchasers, for which
invoices shall have been received by Company on or prior to the Amendment
Effective Date.
E. Confirmation of Tax Allocation and Budgeted Plan. The Company hereby
ratifies and confirms that this Amendment shall not amend or otherwise alter the
allocation of issue price of $29,500,000 to the Notes and $500,000 to the
Warrants as set forth in the original Purchase Agreement. The Company further
ratifies and confirms its obligation under Section 4.1(d) of the Warrant
Agreement to provide to Purchasers a breakdown of the Budgeted Plan (as defined
in the Warrant Agreement) on a quarter-annual basis, reasonably acceptable to
Required Holders (as defined in the Warrant Agreement).
F. Consent to Amended Agreements. Fleet hereby consents to this
Amendment and the amendments and modifications to the Amended Agreements as
effected by this Amendment and the transactions described in Section 6 hereof.
G. Consent to Registration Rights. With reference to Section 7.6(B) of
the Purchase Agreement, the Purchasers hereby consent to the grant of
registration rights to the holders of the Senior Subordinated Note Obligations
as contemplated by the Senior Subordinated Loan Agreement (as defined in Section
1.1B).
H. Ratification and Confirmation. Except as specifically amended by
this Amendment and the Amendment and Confirmation of Subordination Agreements
dated as of the date hereof by and among the Purchasers, the Company, and Fleet,
(i) the Purchase Agreement, (ii) the Warrant Agreement, (iii) the Senior Lenders
Intercreditor Agreement, (iv) the existing Senior Subordinated Lenders
Intercreditor Agreement with Oaktree, and (v) the Investor Subordination
Agreement shall remain in full force and effect and are hereby ratified and
confirmed.
[Remainder of page intentionally left blank; signature pages to follow]
19
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the day and year first above written.
COMPANY:
LBI HOLDINGS I, INC.
By: /s/ Xxxxxx Xxxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxxx
---------------------------------------
Title: Executive Vice President
--------------------------------------
PURCHASERS:
ALTA COMMUNICATIONS VIII, L.P.
By: Alta Communications VIII Managers, LLC,
its General Partner
By: /s/ Xxxxxx XxXxxxxx
-----------------------------------------
Name: Xxxxxx XxXxxxxx
---------------------------------------
Title: Member
--------------------------------------
ALTA-COMM VIII S BY S, LLC
By: /s/ Xxxxxx XxXxxxxx
-----------------------------------------
Name: Xxxxxx XxXxxxxx
---------------------------------------
Title: Member
--------------------------------------
ALTA COMMUNICATIONS VIII-B, L.P.
By: Alta Communications VIII Managers, LLC,
its General Partner
By: /s/ Xxxxxx XxXxxxxx
-----------------------------------------
Name: Xxxxxx XxXxxxxx
---------------------------------------
Title: Member
--------------------------------------
S-1
ALTA VIII ASSOCIATES, LLC
By: Alta Communications, Inc.
By: /s/ Xxxxxx XxXxxxxx
----------------------------------------------
Name: Xxxxxx XxXxxxxx
--------------------------------------------
Title: Member
-------------------------------------------
CALIFORNIA STATE TEACHERS'
RETIREMENT SYSTEM
By: /s/ Xxxxxxxxxxx X. Xxxxxx
----------------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxx
--------------------------------------------
Title: Chief Investment Officer
-------------------------------------------
BANCBOSTON INVESTMENTS INC.
By: /s/ Xxxx X. Xxxxxxx
----------------------------------------------
Name: Xxxx X. Xxxxxxx
--------------------------------------------
Title: Director
-------------------------------------------
UNIONBANCAL EQUITIES, INC.
By: /s/ J. Xxxxx Xxxxxxx /s/ Xxxxx Xxxxxxxx
----------------------------------------------
Name: J. Xxxxx Xxxxxxx Xxxxx Xxxxxxxx
--------------------------------------------
Title: Vice President Vice President
-------------------------------------------
S-2
For purposes of Sections 4, 7, 8A and 9 only:
OAKTREE CAPITAL MANAGEMENT, LLC,
individually and as agent for the Holders under that
certain Note Purchase Agreement
By: /s/ Xxxxxxx Xxxxx
---------------------------------------------------
Name: Xxxxxxx Xxxxx
-------------------------------------------------
Title: Managing Director
------------------------------------------------
By: /s/ Xxxxxxx Xxxx
---------------------------------------------------
Name: Xxxxxxx Xxxx
-------------------------------------------------
Title: Vice President, Legal
------------------------------------------------
For purposes of Sections 3, 5, 7, 8A and 9 only:
FLEET NATIONAL BANK, individually and as agent for the
Senior Lenders
By: /s/ Xxxxxx Xxxxxxxx
---------------------------------------------------
Name: Xxxxxx Xxxxxxxx
-------------------------------------------------
Title: Director
------------------------------------------------
S-3
SCHEDULE 3.4(a)
(to the Securities Purchase Agreement, as revised on July 9, 2002)
CAPITALIZATION
Xxxx Xxxxxxxx - 100 shares of Common Stock.
Xxxxxx Xxxxxxxx - 100 shares of Common Stock.
SCHEDULE 3.4(b)
(to the Securities Purchase Agreement, as revised on July 9, 2002)
EQUITY RIGHTS
1. Pursuant to a Stock Purchase Agreement dated as of January 6, 1998,
between Xxxx Xxxxxxxx, Xxxxxx Xxxxxxxx, Xxxxxx X. Xxxxxxxx
(collectively, the "Shareholders") and LBI Holdings I, Inc. (the
"Company"), upon the death of any Shareholder, the surviving
Shareholders and the Company will have an option to purchase the
deceased Shareholder's stock. The Shareholders are subject to certain
restrictions on pledging, transferring, hypothecating, dividing,
assigning or otherwise alienating their stock in the Company.
2. Pursuant to that certain Employment Agreement dated September 1, 1999,
by and between LBI Holdings I, Inc. and Xxxxxx Xxxxx, Xx. Xxxxx is
entitled under an incentive plan to receive payment in either cash or
Common Stock of LBI Holdings I, Inc. if, among other things, stock of
LBI Holdings I, Inc. is traded on the New York Stock Exchange or the
National Association of Securities Dealers Automated Quotation System.
3. Pursuant to that certain Employment Agreement dated November 15, 1998,
by and between LBI Holdings I, Inc. and Xxxxxx X. Mars, Mr. Mars is
entitled under an incentive plan to receive payment in either cash or
Common Stock of LBI Holdings I, Inc. if, among other things, stock of
LBI Holdings I, Inc. is traded on the New York Stock Exchange or the
National Association of Securities Dealers Automated Quotation System.
4. Pursuant to that certain Employment Agreement dated December 1, 1999,
by and between Xxxxxxxx Broadcasting Inc. and Xxxxxxx Xxxx, Xx. Xxxx is
entitled under an incentive plan to receive payment in either cash or
Common Stock of Xxxxxxxx Broadcasting Inc. if, among other things,
stock of Xxxxxxxx Broadcasting Inc. is capable of being immediately
traded on the New York Stock Exchange or the National Association of
Securities Dealers Automated Quotation System.
SCHEDULE 3.7
(to the Securities Purchase Agreement, as revised on July 9, 2002)
AFFILIATE TRANSACTIONS
1. Regarding the Empire Burbank Studios located at 0000 Xxxxxx Xxxx.,
Xxxxxxx, Xxxxxxxxxx, the following leases are in effect:
(a) Lease dated as of July 15, 1999 by and between Empire Burbank
Studios, Inc., a California corporation ("Empire"), as
landlord, and Xxxxxxxx Broadcasting, Inc., a California
corporation ("Xxxxxxxx Broadcasting"), as tenant
(b) Sublease Agreement dated as of July 15, 1999 by and between
Xxxxxxxx Broadcasting, as sublandlord and Empire, as subtenant
2. Spanish Media Rep Team is a wholly owned subsidiary of Xxxx Xxxxxxxx
and Xxxxxx Xxxxxxxx and it receives a 15% commission from Xxxxxxxx
Broadcasting Inc. for any advertising time is sells. The agreement is
not memorialized in writing.
3. LBI Holdings I, Inc. will make capital contributions to LBI
Intermediate Holdings, Inc., and LBI Intermediate Holdings, Inc. will
make certain dividend payments to LBI Holdings I, Inc. on the Effective
Date.
4. Third Amended and Restated Demand Promissory Note dated March 20, 2001,
by Xxxxxxxx Broadcasting, Inc. in favor of Xxxx Xxxxxxxx with
accumulated principal and interest equal to $1,667,193 as of March 31,
2002. The remaining balance of this promissory note will be paid on or
about July 9, 2002.
5. Third Amended and Restated Demand Promissory Note dated March 20, 2001,
by Xxxxxxxx Broadcasting, Inc. in favor of Xxxxxx Xxxxxxxx with
accumulated principal and interest equal to $194,414 as of March 31,
2002. The remaining balance of this promissory note will be paid on or
about July 9, 2002.
6. As of Xxxxx 00, 0000, XXX Media, Inc. (formerly known as LBI Holdings
II, Inc.) had outstanding loans of $243,095 and $146,950 to Xxxx and
Xxxxxx Xxxxxxxx, respectively, which loans were made in December 2001.
7. On or about July 9, 2002, LBI Media, Inc. made a loan of $1,916,563 to
Xxxxxx Xxxxxxxx. The loan will mature in seven years and bear interest
at the applicable federal rate.
8. Those transactions and payments described in Section 7.6(a) through (h)
of the Senior Loan Agreement or otherwise permitted by the Senior Loan
Agreement.
9. Item #1 of Schedule 3.4(b) is incorporated herein by reference.
ANNEX A TO AMENDMENT
EXHIBIT A
THIS INSTRUMENT IS SUBJECT TO A SUBORDINATION AND INTERCREDITOR
AGREEMENT DATED AS OF MARCH 20, 2001 BY AND AMONG LBI HOLDINGS I, INC., A
CALIFORNIA CORPORATION, FLEET NATIONAL BANK, INDIVIDUALLY AND AS ADMINISTRATIVE
AGENT FOR CERTAIN LENDERS, AND CERTAIN OTHER PARTIES, AS AMENDED FROM TIME TO
TIME. BY ITS ACCEPTANCE OF THIS INSTRUMENT, THE HOLDER HEREOF AGREES TO BE BOUND
BY THE PROVISIONS OF SUCH SUBORDINATION AND INTERCREDITOR AGREEMENT TO THE SAME
EXTENT THAT THE SUBORDINATED CREDITORS (AS DEFINED THEREIN) ARE BOUND.
THIS INSTRUMENT IS SUBJECT TO THE SUBORDINATION AND INTERCREDITOR
PROVISIONS CONTAINED IN ARTICLE XIX OF THE SECURITIES PURCHASE AGREEMENT
DESCRIBED BELOW. BY ITS ACCEPTANCE OF THIS INSTRUMENT, THE HOLDER HEREOF AGREES
TO BE BOUND BY SUCH SUBORDINATION AND INTERCREDITOR PROVISIONS TO THE SAME
EXTENT THAT THE PERMITTED HOLDERS (AS DEFINED THEREIN) ARE BOUND.
THE SECURITIES REPRESENTED BY THIS NOTE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR
APPLICABLE STATE LAWS. THESE SECURITIES MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS THE REGISTRATION PROVISIONS OF SAID ACT AND LAWS HAVE BEEN
COMPLIED WITH OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL
ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED. FURTHERMORE,
THESE SECURITIES MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS
THE COMPANY HAS RECEIVED AN OPINION OF TAX COUNSEL REASONABLY ACCEPTABLE TO THE
COMPANY IN FORM AND SUBSTANCE REASONABLY ACCEPTABLE TO THE COMPANY TO THE EFFECT
THAT SUCH SALE, TRANSFER, PLEDGE OR HYPOTHECATION WILL NOT TERMINATE THE
COMPANY'S CLASSIFICATION AS AN S CORPORATION.
JUNIOR SUBORDINATED PROMISSORY NOTE
[$___________] Dated as of March 20, 2001
FOR VALUE RECEIVED, the undersigned LBI HOLDINGS I, INC., a California
corporation (the "Borrower"), hereby unconditionally promises to pay to the
order of [________________] (hereinafter with any subsequent holder referred to
as "Lender"), having its principal place of business at [________________], on
the Maturity Date (as hereinafter defined), the principal amount of [_________
Dollars ($_________)] together with interest thereon, at the rates provided for
in the Securities Purchase Agreement (hereafter described).
This Note is one of the "Notes" referred to in, and is entitled to all
the benefits of that certain Securities Purchase Agreement dated as of the date
hereof, by and among Borrower,
A-1
Lender and the other parties signatories thereto (as may be amended from time to
time, the "Securities Purchase Agreement"). All capitalized terms used herein
and not otherwise defined shall have the meanings given to such terms in the
Securities Purchase Agreement.
Interest on the principal amount outstanding hereunder shall accrue and
shall be paid as provided in the Securities Purchase Agreement.
The outstanding principal amount of this Note, together with all
accrued interest thereon, shall be due and payable, without setoff, deduction or
counterclaim, on July 9, 2013, or on such earlier date as provided in the
Securities Purchase Agreement (the "Maturity Date").
Borrower may prepay the outstanding principal amount and accrued
interest hereunder, in full or in part, upon the terms and conditions set forth
in the Securities Purchase Agreement.
Payments of principal and interest due hereunder shall be made by
Borrower in lawful money of the United States of America and immediately
available funds to Lender at its address set forth in the first paragraph of
this Note, or at such other place as Lender may designate to the Borrower in
writing, in accordance with the Securities Purchase Agreement. All payments
hereunder, unless otherwise determined by Lender, shall be applied first to
interest, fees and expenses then due and the balance, if any, to principal.
In no event shall the undersigned be required to pay any interest or
other fees or charges in excess of the maximum permitted by applicable law. If,
for any circumstances whatsoever, fulfillment of any provisions hereof or of the
Securities Purchase Agreement, at the time performance of such provision shall
be due, shall involve exceeding such amount, then the obligation to be fulfilled
shall automatically be reduced to the limit of such validity, and if from any
circumstance Lender should ever receive as interest an amount which would exceed
such maximum amount, such amount which would be excessive interest shall be
applied to the reduction of the principal balance evidenced hereby and not to
the payment of interest. As used herein, the term "applicable law" shall mean
the law in effect as of the date hereof; provided, however, that in the event
there is a change in the law which results in a higher permissible rate of
interest, then this Note shall be governed by such new law as of its effective
date. This provision shall control every other provision of all agreements
between Borrower and Lender.
Borrower agrees to pay all costs and expenses (including reasonable
attorneys' fees) incurred by Lender in the collection of this Note and the
enforcement of any agreement or instrument securing this Note.
Any and all sums at any time due from Lender to Borrower shall at all
times constitute security for this Note and any other obligations of Borrower to
Lender and may be applied or set off by Lender against such obligations whether
or not other collateral is available to Lender.
Borrower, for itself and its legal representatives, successors and
assigns, hereby expressly waives presentment, dishonor, protest and demand,
diligence, notice of protest of demand and of dishonor, and any other notice
otherwise required to be given under the law in connection with the delivery,
acceptance, performance, default, enforcement or collection of this Note, and
expressly agrees that this Note, or any payment hereunder, may be extended or
subordinated (by forbearance or otherwise) as set forth in the Securities
Purchase Agreement.
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No delay or omission on the part of Lender in exercising any right
hereunder shall operate as a waiver of such right or of any other right of
Lender nor shall any delay, omission or waiver on any one occasion be deemed a
bar to or waiver of the same or any other right on any future occasion. No
consent or waiver by Lender with respect to any action or failure to act which,
without such consent or waiver, would constitute a breach of any provision of
this Note shall be valid and binding unless in writing and signed by Borrower
and Lender.
Transfer of this Note is registrable on the Note register of Borrower
upon presentation at the principal office of Borrower accompanies by a written
instrument of transfer in form reasonably satisfactory to Borrower duly executed
by, or on behalf of, the holder hereof; provided any such transferee is also a
Permitted Holder. This Note may also be exchanged at such office for one or more
Notes in any authorized denominations, as requested by the holder, of a like
aggregate unpaid principal amount. Any transfer of this Note shall be subject to
the terms of the Securities Purchase Agreement and any such transferee's
agreement to be bound to the terms of the Securities Purchase Agreement, the
Related Agreements and the Intercreditor Agreements, and by acceptance of this
Note the holder agrees to be bound by the terms of the Securities Purchase
Agreement, the Related Agreements and the Intercreditor Agreements.
Prior to due presentment for registration of transfer, Borrower and any
agent of Borrower may treat the person in whose name this Note is registered as
the owner hereof for the purpose of receiving payment of principal and interest
as herein provided and for all other purposes.
This Note shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts without giving effect to any choice or
conflict of law provision or rule that would cause the application of the
domestic substantive laws of any other jurisdiction.
This Note is subject to certain subordination provisions as set forth
in the Intercreditor Agreements.
BORROWER HEREBY WAIVES TRIAL BY JURY IN ANY ACTION PERTAINING TO THE
ENFORCEMENT OF THIS NOTE OR ANY AGREEMENT OR INSTRUMENT SECURING THIS NOTE.
This Note is executed as of the date first set forth above as a sealed
instrument, shall be binding upon the undersigned and its successors and
assigns, and shall inure to the benefit of Lender and its successors and
assigns.
LBI HOLDINGS I, INC.
Witness:
By:___________________________________
______________________________ Name:_________________________________
Title:________________________________
A-3
ANNEX B TO AMENDMENT
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES
ISSUABLE UPON EXERCISE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND THEY MAY NOT BE SOLD OR
OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE
SECURITIES UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR THE
AVAILABILITY OF AN EXEMPTION FROM REGISTRATION UNDER SAID ACT AND ANY APPLICABLE
STATE SECURITIES LAWS.
THE SALE, TRANSFER, PLEDGE, OR HYPOTHECATION (COLLECTIVELY, THE
"TRANSFER") OR EXERCISE OF THIS WARRANT AND THE TRANSFER OF THE SECURITIES
ISSUABLE UPON EXERCISE ARE SUBJECT TO THE COMMUNICATIONS ACT OF 1934, AS
AMENDED, AND THE RULES AND REGULATIONS OF THE FEDERAL COMMUNICATIONS COMMISSION.
FURTHERMORE, THE WARRANTS REPRESENTED BY THIS CERTIFICATE MAY NOT BE
TRANSFERRED OR EXERCISED AND THE SECURITIES ISSUABLE UPON EXERCISE MAY NOT BE
TRANSFERRED, IN EACH CASE, UNLESS THE COMPANY HAS RECEIVED AN OPINION OF TAX
COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY IN FORM AND SUBSTANCE REASONABLY
ACCEPTABLE TO THE COMPANY TO THE EFFECT THAT SUCH TRANSFER OR EXERCISE, AS
APPLICABLE, WILL NOT TERMINATE THE COMPANY'S CLASSIFICATION AS AN "S"
CORPORATION EXCEPT TO THE EXTENT SUCH EXERCISE IS OTHERWISE PERMITTED UNDER THE
PURCHASE AGREEMENT DEFINED IN THE BELOW-REFERENCED WARRANT AGREEMENT.
THIS INSTRUMENT IS SUBJECT TO A SUBORDINATION AND INTERCREDITOR
AGREEMENT DATED AS OF MARCH 20, 2001 BY AND AMONG LBI HOLDINGS I, INC., A
CALIFORNIA CORPORATION, THE PURCHASERS PARTY TO THE PURCHASE AGREEMENT, AND
FLEET NATIONAL BANK, INDIVIDUALLY AND AS ADMINISTRATIVE AGENT (THE
"ADMINISTRATIVE AGENT") FOR CERTAIN LENDERS AND CERTAIN OTHER PARTIES, AS
AMENDED FROM TIME TO TIME. BY ITS ACCEPTANCE OF THIS INSTRUMENT, THE HOLDER
HEREOF AGREES TO BE BOUND BY THE PROVISIONS OF SUCH SUBORDINATION AND
INTERCREDITOR AGREEMENT TO THE SAME EXTENT THAT THE SUBORDINATED CREDITORS (AS
DEFINED THEREIN) ARE BOUND.
THIS INSTRUMENT IS SUBJECT TO THE SUBORDINATION AND INTERCREDITOR
PROVISIONS CONTAINED IN ARTICLE XIX OF THE PURCHASE AGREEMENT (AS DEFINED IN THE
WARRANT AGREEMENT
B-1
DESCRIBED BELOW). BY ITS ACCEPTANCE OF THIS INSTRUMENT, THE HOLDER HEREOF AGREES
TO BE BOUND BY SUCH SUBORDINATION AND INTERCREDITOR PROVISIONS TO THE SAME
EXTENT THAT THE PERMITTED HOLDERS (AS DEFINED IN THE PURCHASE AGREEMENT) ARE
BOUND.
WARRANT CERTIFICATE
LBI HOLDINGS I, INC.
No. WR-___-2002 [_____] Warrants
Dated as of March 20, 2001
This Warrant Certificate certifies that ________, or registered
assigns, is the registered holder of ____________ (__________) Warrants to
purchase shares of Common Stock of LBI HOLDINGS I, INC. (the "Company"), a
California corporation. Each Warrant initially entitles the owner thereof to
purchase at any time on or before the Expiration Date one (1) fully paid and
nonassessable share of Common Stock of the Company, at a Purchase Price of one
cent ($0.01) upon (i) presentation and surrender of this Warrant Certificate
with a form of election to purchase duly executed and (ii) delivery to the
Company of the payment of the Purchase Price in the manner set forth in the
Warrant Agreement referred to below. The number of shares of Common Stock
purchasable pursuant to this Warrant Certificate and the Purchase Price therefor
are subject to adjustment as referred to below.
The Warrants are issued pursuant to the Warrant Agreement, dated as of
March 20, 2001 (as it may from time to time be amended or supplemented, the
"Warrant Agreement"), between the Company and the purchasers named therein, and
are subject to all of the terms, provisions and conditions thereof, which
Warrant Agreement is hereby incorporated herein by reference and made a part
hereof and to which Warrant Agreement reference is hereby made for a full
description of the rights, obligations, duties and immunities of the Company and
the holders of the Warrant Certificates. Capitalized terms used, but not
defined, herein have the respective meanings ascribed to them in the Warrant
Agreement.
As provided in the Warrant Agreement, the number of shares of Common
Stock purchasable pursuant to this Warrant Certificate and/or the Purchase Price
are, upon the happening of certain events, subject to adjustment. As further set
forth in, and subject to, the Warrant Agreement, the expiration date of this
Warrant Certificate is 5:00 p.m. Eastern Time on the earlier of (a) the later of
(i) January 9, 2015, or (ii) the date which is six (6) months from the date of
payment in full of all outstanding principal and interest on the Notes and (b)
the closing of the sale and issuance of shares of Common Stock of the Company in
an underwritten public offering pursuant to an effective registration statement
under the Securities Act of 1933, as amended, the gross proceeds of which exceed
$25,000,000; provided that if the holders of the Warrants have not had the right
to put the Warrants under Section 5.1 of the Warrant Agreement, the expiration
date of this Warrant Certificate shall extend until such time as the holders
have such right.
B-2
This Warrant Certificate shall be exercisable, at the election of the
holder, either as an entirety or in part from time to time. If this Warrant
Certificate shall be exercised in part, the holder shall be entitled to receive,
upon surrender hereof, another Warrant Certificate or Warrant Certificates for
the number of Warrants not exercised. This Warrant Certificate, with or without
other Warrant Certificates, upon surrender in the manner set forth in the
Warrant Agreement, may be exchanged for another Warrant Certificate or Warrant
Certificates of like tenor evidencing Warrants entitling the holder to purchase
a like aggregate number of shares of Common Stock as the Warrants evidenced by
the Warrant Certificate or Warrant Certificates surrendered shall have entitled
such holder to purchase.
Except as expressly set forth in the Warrant Agreement, no holder of
this Warrant Certificate shall be entitled to vote or receive dividends or be
deemed for any purpose the holder of shares of Common Stock or of any other
Securities of the Company that may at any time be issued upon the exercise
hereof, nor shall anything contained in the Warrant Agreement or herein be
construed to confer upon the holder hereof, as such, any of the rights of a
holder of a share of Common Stock in the Company or any right to vote upon any
matter submitted to holders of shares of Common Stock at any meeting thereof, or
to give or withhold consent to any corporate action (whether upon any
recapitalization, issuance of stock, reclassification of Securities, change of
par value, consolidation, merger, conveyance, or otherwise) or, except as
provided in the Warrant Agreement, to receive notice of meetings, or to receive
dividends or subscription rights, or otherwise, until the Warrant or Warrants
evidenced by this Warrant Certificate shall have been exercised as provided in
the Warrant Agreement.
THIS WARRANT CERTIFICATE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, AND THE RIGHTS OF THE COMPANY AND THE HOLDER HEREOF SHALL BE GOVERNED BY,
THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS (OTHER THAN ITS CONFLICTS OF LAW
PRINCIPLES). THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO
AGREEMENTS, COVENANTS AND RESTRICTIONS PROVIDED IN THE VOTING AND CO-SALE
AGREEMENT DATED MARCH 20, 2001, AND THE SECURITIES PURCHASE AGREEMENT DATED
MARCH 20, 2001, EACH AS AMENDED FROM TIME TO TIME, BY AND AMONG THE COMPANY AND
THE PERSONS NAMED THEREIN. A COPY OF SUCH AGREEMENTS MAY BE OBTAINED BY ANY
HOLDER OF THIS WARRANT UPON REQUEST WITHOUT CHARGE FROM THE SECRETARY OF THE
COMPANY AT THE PRINCIPAL OFFICE OF THE COMPANY.
WITNESS the signature of a proper officer of the Company as of the date
first above written.
ATTEST: LBI HOLDINGS I, INC.
______________________________ By:_____________________________
Secretary Name:
Title:
B-3
[FORM OF ASSIGNMENT]
(To be executed by the registered holder if such holder desires to transfer
the Warrant Certificate)
FOR VALUE RECEIVED, _______________________________ hereby sells,
assigns and transfers unto
______________________________________________________________________________
(Please print name, address and taxpayer identification number or social
security number of transferee)
the accompanying Warrant Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and appoint:
___________________________________________ attorney, to transfer the
accompanying Warrant Certificate on the books of the Company, with full power of
substitution.
Dated: _________________, ______.
________________________
Signature of Holder
NOTICE
The signature to the foregoing Assignment must correspond to the name
as written upon the face of the accompanying Warrant Certificate or any prior
assignment thereof in every particular, without alteration or enlargement or any
change whatsoever.
B-4
[FORM OF ELECTION TO PURCHASE]
(To be executed by the registered holder if
such holder desires to exercise the Warrant Certificate)
To: ___________:
The undersigned hereby irrevocably elects to exercise _____ Warrants
represented by the accompanying Warrant Certificate to purchase the shares of
Common Stock issuable upon the exercise of such Warrants and requests that
certificates for such shares be issued in the name of:
-----------------------------------------------------------------------
(Please print name and address.)
-----------------------------------------------------------------------
(Please insert social security or other identifying number.)
If such number of Warrants shall not be all the Warrants evidenced by
the accompanying Warrant Certificate, a new Warrant Certificate for the balance
remaining of such Warrants shall be registered in the name of and delivered to:
-----------------------------------------------------------------------
(Please print name and address.)
-----------------------------------------------------------------------
(Please insert social security or other identifying number.)
Dated:_______________,________.
_____________________
Signature of Holder
NOTICE
The signature to the foregoing Election to Purchase must correspond to
the name as written upon the face of the accompanying Warrant Certificate or any
prior assignment thereof in every particular, without alteration or enlargement
or any change whatsoever.
B-5
