EXHIBIT 10.9
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TERM LOAN AGREEMENT
among
LCG ACQUISITION CORPORATION,
THE LENDERS PARTIES HERETO,
THE BANK OF NOVA SCOTIA,
as Syndication Agent,
FLEET NATIONAL BANK,
as Documentation Agent,
and
UNION BANK OF CALIFORNIA, N.A.,
as Agent
Dated as of April 20, 2000
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TABLE OF CONTENTS
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Page
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SECTION 1. DEFINITIONS.............................................................. 1
1.1 Defined Terms............................................................ 1
1.2 Other Definitional Provisions............................................ 15
SECTION 2. AMOUNT AND TERMS OF LOANS; COMMITMENT AMOUNTS............................ 16
2.1 Loans; Commitment Amounts................................................ 16
2.2 Optional Prepayments..................................................... 17
2.3 Mandatory Prepayments.................................................... 17
2.4 Conversion and Continuation Options...................................... 17
2.5 Minimum Amounts of Tranches.............................................. 18
2.6 Interest Rates and Payment Dates......................................... 18
2.7 Computation of Interest and Fees......................................... 19
2.8 Inability to Determine Interest Rate..................................... 19
2.9 Pro Rata Treatment and Payments.......................................... 19
2.10 Illegality............................................................... 20
2.11 Increased Costs.......................................................... 20
2.12 Taxes.................................................................... 21
2.13 Indemnity................................................................ 22
2.14 Mitigation of Costs...................................................... 23
SECTION 3. REPRESENTATIONS AND WARRANTIES........................................... 23
3.1 Organization and Good Standing........................................... 23
3.2 Power and Authority...................................................... 23
3.3 Validity and Legal Effect................................................ 23
3.4 No Violation of Laws or Agreements....................................... 23
3.5 Title to Assets; Existing Encumbrances; Intellectual and Real Property... 24
3.6 Capital Structure and Equity Ownership................................... 24
3.7 Subsidiaries, Affiliates and Investments................................. 24
3.8 Material Contracts....................................................... 24
3.9 Media Licenses........................................................... 25
3.10 Taxes and Assessments.................................................... 25
3.11 Litigation and Legal Proceedings......................................... 25
3.12 Accuracy of Financial Information........................................ 26
3.13 Accuracy of Other Information............................................ 26
3.14 Compliance with Laws Generally........................................... 26
3.15 ERISA Compliance......................................................... 26
3.16 Environmental Compliance................................................. 27
3.17 Federal Regulations...................................................... 28
3.18 Fees and Commissions..................................................... 28
3.19 Publishing Business...................................................... 28
3.20 Solvency................................................................. 28
3.21 FCC-Related Representations.............................................. 28
3.22 Investment Company Act; Other Regulations................................ 29
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3.23 Copyright Act Requirements............................................... 29
3.24 Nature of Business....................................................... 29
3.25 Ranking of Loans......................................................... 30
3.26 Condemnation............................................................. 30
SECTION 4. CONDITIONS PRECEDENT..................................................... 30
4.1 Conditions to Closing Date............................................... 30
SECTION 5. AFFIRMATIVE COVENANTS.................................................... 34
5.1 Financial Statements..................................................... 34
5.2 Certificates; Other Information.......................................... 35
5.3 Payment of Obligations................................................... 37
5.4 Conduct of Business and Maintenance of Existence......................... 37
5.5 Maintenance of Property; Insurance....................................... 37
5.6 Inspection of Property; Books and Records; Discussions................... 38
5.7 Environmental Laws....................................................... 38
5.8 Use of Proceeds.......................................................... 39
5.9 Compliance With Laws, Etc................................................ 39
5.10 Media Licenses........................................................... 39
5.11 Guarantees, Etc.......................................................... 40
5.12 License Subsidiary....................................................... 40
5.13 Interest Rate Protection................................................. 40
5.14 Leases and Licenses...................................................... 40
5.15 Lease and License Approvals.............................................. 40
5.16 Notices.................................................................. 41
5.17 Additional Material Contracts and Media Licenses......................... 41
SECTION 6. NEGATIVE COVENANTS....................................................... 41
6.1 Financial Condition Covenants............................................ 41
6.2 Limitation on Indebtedness............................................... 42
6.3 Limitation on Liens...................................................... 42
6.4 Limitation on Fundamental Changes........................................ 43
6.5 Limitation on Sale of Assets............................................. 43
6.6 Limitation on Dividends.................................................. 43
6.7 Limitation on Investments, Loans and Advances............................ 44
6.8 Limitation on Modifications of Certain Documents and Instruments......... 44
6.9 Transactions with Affiliates............................................. 44
6.10 Fiscal Year.............................................................. 44
6.11 Lease Obligations........................................................ 44
6.12 Unfunded Liabilities..................................................... 45
6.13 Management Fees.......................................................... 45
6.14 Equity Offerings......................................................... 45
SECTION 7. EVENTS OF DEFAULT........................................................ 45
SECTION 8. THE AGENT................................................................ 50
8.1 Appointment.............................................................. 50
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8.2 Delegation of Duties..................................................... 50
8.3 Exculpatory Provisions................................................... 50
8.4 Reliance by the Agent.................................................... 50
8.5 Notice of Default........................................................ 51
8.6 Non-Reliance on the Agent and Other Lenders.............................. 51
8.7 Indemnification.......................................................... 52
8.8 The Agent in Its Individual Capacity..................................... 52
8.9 Successor Agent.......................................................... 52
SECTION 9. MISCELLANEOUS............................................................ 52
9.1 Amendments and Waivers................................................... 52
9.2 Notices.................................................................. 53
9.3 No Waiver; Cumulative Remedies........................................... 54
9.4 Survival of Representations and Warranties............................... 54
9.5 Payment of Expenses and Taxes............................................ 55
9.6 Successors and Assigns; Participations; Purchasing Lenders............... 55
9.7 Adjustments; Set-Off..................................................... 58
9.8 Counterparts............................................................. 59
9.9 Severability............................................................. 59
9.10 Integration.............................................................. 59
9.11 GOVERNING LAW............................................................ 59
9.12 Alternative Dispute Resolution........................................... 59
9.13 Acknowledgements......................................................... 60
9.14 Headings................................................................. 61
9.15 Copies of Certificates, Etc.............................................. 61
9.16 Publicity................................................................ 61
9.17 Confidentiality.......................................................... 61
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TERM LOAN AGREEMENT
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THIS TERM LOAN AGREEMENT, dated as of April 20, 2000, among (1) LCG
ACQUISITION CORPORATION, a Delaware corporation ("LCGAC"), (2) the several banks
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and other financial institutions from time to time parties to this Agreement
(the "Lenders") and (3) UNION BANK OF CALIFORNIA, N.A., as agent for the Lenders
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hereunder (in such capacity, the "Agent").
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RECITALS
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A. LCGAC, a direct wholly-owned subsidiary of Entravision Communications
Company, L.L.C., a Delaware limited liability company ("Entravision"), was
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organized by Entravision to acquire Latin Communications Group Inc., a Delaware
corporation ("LCG").
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B. Pursuant to the Agreement and Plan of Merger dated December 21, 1999
among Entravision, LCGAC, LCG and certain other parties (the "Merger
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Agreement"), LCGAC will merge with and into LCG (the "Merger"), and LCG will be
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the surviving corporation.
C. LCGAC has requested that, simultaneously with the consummation of the
Merger, the Lenders lend to the Borrower (i) $105,000,000 to pay a portion of
the aggregate consideration to be paid by LCGAC in the Merger for outstanding
shares of LCG and (ii) $10,000,000 to pay a portion of the interest accruing
hereunder. The Lenders have indicated their willingness to agree to lend such
amounts on the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following terms shall
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have the following meanings:
"Accountants": McGladrey & Xxxxxx, LLP, or such other firm of independent
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certified public accountants of recognized national standing as shall be
selected by the Borrower and satisfactory to the Agent.
"Affiliate": as to any Person, (a) any other Person (other than a
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Subsidiary) which, directly or indirectly, is in control of, is controlled by,
or is under common control with, such Person or (b) any Person who is a
director, officer, shareholder or partner (i) of such Person, (ii) of any
Subsidiary of such Person or (iii) of any Person described in the preceding
clause (a).
For purposes of this definition, "control" of a Person means the power, directly
or indirectly, either to (i) vote securities having 5% or more of the ordinary
voting power for the election of directors of such Person or (ii) direct or
cause the direction of the management and policies of such Person whether by
contract or otherwise.
"Agent": as defined in the preamble hereto.
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"Aggregate Commitment": the sum of the Commitments set forth on the
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signature pages hereto, as the same may be adjusted from time to time pursuant
to the provisions hereof.
"Agreement": this Term Loan Agreement, as amended, waived, supplemented or
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otherwise modified from time to time.
"Applicable Lending Office": for any Lender, its offices for LIBOR Loans
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and Base Rate Loans specified below its signature on the signature pages hereof
or in the Assignment and Acceptance pursuant to which it becomes a party hereto,
as the case may be, any of which offices may, upon 10 days' prior written notice
to the Agent and the Borrower, be changed by such Lender.
"Applicable Margin": for each LIBOR Loan and for each Base Rate Loan as set
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forth below:
Period LIBOR Margin Base Rate Margin
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Closing Date to and including
August 17, 2000 4.00% 3.00%
August 18, 2000 to and including
October 16, 2000 4.25% 3.25%
October 17, 2000 and thereafter 4.50% 3.50%
; provided, however, that if the Entravision IPO is not consummated prior to
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September 30, 2000, each percentage listed in the table above shall
automatically increase by 0.25%, effective with respect to all interest accruing
on or after September 30, 2000.
"Asset Disposition": the sale, sale and leaseback, transfer, conveyance,
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exchange, long-term lease accorded sales treatment under GAAP or similar
disposition (including by means of a merger, consolidation, amalgamation, joint
venture or other substantive combination) of any of the Properties, business or
assets (other than marketable securities, including "margin stock" within the
meaning of Regulation U, liquid investments and other financial instruments but,
including, without limitation, the assignment of any lease, license or permit
relating to the Properties) of the Borrower or any of its Subsidiaries to any
Person or Persons other than to the Borrower or any of its Subsidiaries;
provided that Asset Dispositions shall not include the sale in the ordinary
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course of business of equipment.
"Assignment and Acceptance": an Assignment and Acceptance in the form of
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Exhibit B to this Agreement.
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"Base Rate": for any day, a rate per annum (rounded upwards, if necessary,
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to the next 1/16 of 1%) equal to the greater of (a) the Reference Rate in effect
on such day and (b) the Federal Funds Effective Rate in effect on such day plus
1/2 of 1%. "Reference Rate" shall mean the rate of interest per annum publicly
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announced from time to time by Union Bank of California, N.A. as its "reference
rate" in effect at its office in Los Angeles, California. "Federal Funds
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Effective Rate" shall mean, for any day, the weighted average of the rates on
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overnight federal funds transactions with members of the Federal Reserve System
arranged by federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average of the quotations for
the day of such transactions received by the Agent from three federal funds
brokers of recognized standing selected by it. If, for any reason, the Agent
shall have determined (which determination shall be conclusive absent manifest
error) that it is unable to ascertain the Federal Funds Effective Rate for any
reason, including, without limitation, the inability or failure of the Agent to
obtain sufficient quotations in accordance with the terms hereof, the Base Rate
shall be determined without regard to clause (b) of the first sentence of this
definition until the circumstances giving rise to such inability no longer
exist. Any change in the Base Rate due to a change in the Reference Rate or the
Federal Funds Effective Rate shall be effective on the effective date of such
change in the Reference Rate or the Federal Funds Effective Rate, respectively.
"Base Rate Loans": that portion of the Loans the rate of interest
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applicable to which is based upon the Base Rate.
"Borrower": prior to the Merger, LCGAC, and, from and after the Merger,
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LCG, as surviving corporation.
"Business Day": a day other than a Saturday, Sunday or other day on which
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commercial banks in the State of California are authorized or required by law to
close and which, in the case of a LIBOR Loan, is a Eurodollar Business Day.
"Capitalized Lease Obligations": obligations for the payment of rent for
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any real or personal property under leases or agreements to lease that, in
accordance with GAAP, have been or should be capitalized on the books of the
lessee and, for purposes hereof, the amount of any such obligation shall be the
capitalized amount thereof determined in accordance with GAAP.
"Capital Stock": any and all shares, interests, participations or other
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equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation), any and
all warrants, options or rights to purchase, or any other securities convertible
into, any of the foregoing.
"Cash Income Taxes": cash income taxes paid by the Borrower and its
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Subsidiaries during the fiscal quarter most recently ended and the immediately
preceding three fiscal quarters.
"Change in Control": either
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(a) Entravision shall no longer be the owner of all of the Capital Stock
of the Borrower; or
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(b) (i) Xxxxxx X. Xxxxx and Xxxxxx X. Xxxxxxxxx cease collectively to
have, directly or indirectly, Voting Control of Entravision; or
(ii) So long as Entravision is a limited liability company, Xxxxxx X.
Xxxxx and Xxxxxx X. Xxxxxxxxx cease to (A) be the Managing Members thereof,
(B) have the veto rights with regard to decisions of the Executive
Committee set forth in Section 16(a)(i) of the Operating Agreement and (C)
have the power to appoint the Executive Committee thereof.
"Closing Date": the date on which the conditions precedent set forth in
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Section 4.1 have been satisfied.
"Code": the Internal Revenue Code of 1986, as amended from time to time.
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"Collateral": all of the property (tangible or intangible) purported to be
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subject to the lien or security interest purported to be created by any security
agreement, pledge agreement, assignment or other security document heretofore or
hereafter executed by the Borrower as security for all or part of the
Obligations.
"Collateral Documents": the Security Agreement, all notices of security
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interests in deposit accounts requested by the Agent pursuant to the Security
Agreement, Form UCC-1 Financing Statements and amendments thereto and any other
document executed by the Borrower encumbering the Collateral or evidencing or
perfecting a security interest therein for the benefit of the Lenders.
"Commitment Percentage": with respect to each Lender, the percentage
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equivalent of the ratio which such Lender's Commitment bears to the Aggregate
Commitment, as such Lender's Commitment and the Aggregate Commitment may be
adjusted from time to time pursuant to the terms hereof, or, following
termination of the Aggregate Commitment, the percentage equivalent of the ratio
which such Lender's outstanding principal balance of Loans bear to the principal
balance of all Loans outstanding, excluding from such calculation Lenders which
have failed or refused to fund a Loan when required to do so.
"Commitments": as to any Lender, the amount listed as its "Commitment" on
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the signature pages hereto to make a term loan hereunder through its Applicable
Lending Office, as the same shall be adjusted from time to time pursuant to this
Agreement.
"Commonly Controlled Entity": as to any Person, an entity, whether or not
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incorporated, which is under common control with such Person within the meaning
of Section 4001 of ERISA or is part of a group which includes such Person and
which is treated as a single employer under Section 414 of the Code.
"Communications Act": the Communications Act of 1934, as amended, and the
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rules, regulations and policies issued thereunder, as from time to time in
effect.
"Continuation Notice": a request for continuation or conversion of a Loan
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as set forth in Section 2.4, substantially in the form of Exhibit E.
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"Contractual Obligation": as to any Person, any provision of any security
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issued by such Person or of any agreement, instrument or other undertaking to
which such Person is a party or by which it or any of its property is bound.
"Corporate Overhead": for any period, all general and administrative
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expenses of the Borrower and its Subsidiaries for such period not solely
attributable to an individual Station or group of Stations or publication. For
the purpose of illustration (and not for the purpose of limiting the foregoing),
Corporate Overhead shall include the general and administrative expenses of the
headquarters office of the Borrower, the salaries of its officers, lease
expenses for its headquarters office and the legal and accounting expenses
relating to the Borrower, and not relating solely to any Station, group of
Stations or publication.
"Covenant Compliance Certificate": a certificate of the Chief Financial
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Officer of the Borrower substantially in the form of Exhibit D hereto.
"Default": any of the events specified in Section 7, whether or not any
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requirement for the giving of notice, the lapse of time, or both, or any other
condition, has been satisfied.
"Dollars" and "$": dollars in lawful currency of the United States.
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"Entravision": as defined in Recital A hereto.
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"Entravision Credit Agreement": that certain Amended and Restated Credit
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Agreement dated as of November 10, 1998, as amended by the First Amendment to
Amended and Restated Credit Agreement dated as of December 29, 1999, the Second
Amendment to Amended and Restated Credit Agreement dated as of January 14, 2000,
and the Third Amendment to Amended and Restated Credit Agreement dated as of
April 20, 2000, and as it may be further amended, waived, supplemented or
otherwise modified from time to time, among (1) KSMS-TV, Inc., Tierra Alta
Broadcasting, Inc., Cabrillo Broadcasting Corporation, Golden Hills Broadcasting
Corporation, Las Tres Palmas Corporation, Valley Channel 48, Inc., Telecorpus,
Inc. and Entravision, (2) the lenders parties thereto and (3) Union Bank of
California, N.A., as agent for such lenders.
"Entravision IPO": the initial public offering of equity interests in
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Entravision Communications Corporation, a Delaware corporation wholly owned by
Entravision.
"Entravision License Subsidiary": Entravision Holdings, LLC, a California
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limited liability company, which is owned 99.999% by Entravision, 0.0005% by
Xxxxxx X. Xxxxx and 0.0005% by Xxxxxx X. Xxxxxxxxx, formed solely for the
purpose of holding the Entravision Media Licenses.
"Entravision Media Licenses": any franchise, license, permit, certificate,
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ordinance, approval or other authorization, or any renewal or extension thereof,
from any federal, state or local government or governmental agency, department
or body that is necessary for the broadcast or other operations of Entravision
or any of its Subsidiaries (other than the Borrower and its Subsidiaries).
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"Entravision Station": any radio station, any full power television
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station, low power television station, any translator and any other television
system now or hereafter owned, leased or operated by Entravision or any of its
Subsidiaries (other than the Borrower and its Subsidiaries).
"Environmental Control Statutes": as defined in Section 3.16.
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"Equity Offering": the sale or issuance (or reissuance) by the Borrower or
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any Subsidiary of any equity interest (common stock, preferred stock,
partnership interests, member interests or otherwise) or any options, warrants,
convertible securities or other rights to purchase such beneficial or equity
interests.
"Equityholder Agreements" each shareholder agreement, member agreement,
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partner agreement, voting agreement, buy-sell agreement, option, warrant, put,
call, right of first refusal, and any other agreement or instrument with
conversion rights into equity of the Borrower or any Subsidiary either (a)
between the Borrower or any Subsidiary and any holder or prospective holder of
any equity interest of the Borrower or any Subsidiary (including interests
convertible into such equity) or (b) otherwise between any two or more such
holders of equity interests.
"ERISA": the Employee Retirement Income Security Act of 1974, as amended
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from time to time.
"ERISA Affiliate": as to any Person, each trade or business including such
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Person, whether or not incorporated, which together with such Person would be
treated as a single employer under Section 4001(a)(14) of ERISA.
"Eurodollar Business Day": shall mean any day on which banks are open for
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dealings in Dollar deposits in the London Interbank Market.
"Event of Default": any of the events specified in Section 7, provided
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that any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.
"Excluded Taxes": all taxes imposed on or by reference to the net income
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of the Agent or any Lender or its Applicable Lending Office by any Governmental
Authority and all franchise taxes, taxes on doing business or taxes measured by
capital or net worth imposed on the Agent or on any Lender or its Applicable
Lending Office by any Governmental Authority and any taxes imposed by any
Governmental Authority arising as a consequence of the failure of any Lender to
provide accurate documentation required to be provided by such Lender pursuant
to Section 2.12(b).
"FCC": the Federal Communications Commission or any successor thereto.
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"Federal Funds Effective Rate": as defined in the definition of "Base
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Rate" contained in this Section 1.1.
"Final Order": an order, action or decision of the FCC that has not been
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reversed, stayed, enjoined, annulled or suspended and as to which (i) no timely
request for stay, appeal, petition
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for reconsideration, application for review or reconsideration by the FCC on its
own motion is pending and (ii) the time for filing any such request, appeal,
petition or application, or for reconsideration by the FCC on its own motion,
has expired.
"GAAP": generally accepted accounting principles in the United States in
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effect from time to time. If, at any time, GAAP changes in a manner which will
materially affect the calculations determining compliance by the Borrower with
any of the covenants in Section 6.1, such covenants shall continue to be
calculated in accordance with GAAP in effect prior to such changes in GAAP.
"Governmental Authority": any nation or government, any federal, state or
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other political subdivision thereof and any federal, state or local entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Guarantee Obligation": as to any Person (the "guaranteeing person"), any
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obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counter-indemnity
or similar obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")
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of any other third Person (the "primary obligor") in any manner, whether
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directly or indirectly, including, without limitation, any obligation of the
guaranteeing person, whether or not contingent, (i) to purchase any such primary
obligation or any property constituting direct or indirect security therefor,
(ii) to advance or supply funds for the purchase or payment of any such primary
obligation or to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the owner of any such primary obligation against loss
in respect thereof; provided, however, that the term Guarantee Obligation shall
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not include endorsements of instruments for deposit or collection in the
ordinary course of business. The amount of any Guarantee Obligation of any
guaranteeing person shall be deemed to be the lesser of (a) an amount equal to
the stated or determinable amount of the primary obligation in respect of which
such Guarantee Obligation is made and (b) the maximum amount for which such
guaranteeing person may be liable pursuant to the terms of the instrument
embodying such Guarantee Obligation, unless such primary obligation and the
maximum amount for which such guaranteeing person may be liable are not stated
or determinable, in which case the amount of such Guarantee Obligation shall be
such guaranteeing person's maximum reasonably anticipated liability in respect
thereof as determined by the Borrower in good faith.
"Guarantees": the guarantees made by each of the Guarantors (which
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guarantees shall be nonrecourse except for any executed by a Subsidiary of the
Borrower), and all other guarantees executed by a Guarantor in favor of the
Agent for the benefit of the Lenders, in form and substance substantially
identical to those executed in connection with the Entravision Credit Agreement,
as the same may be amended or modified from time to time in accordance with the
terms hereof.
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"Guarantor Collateral": all of the property (tangible or intangible)
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purported to be subject to the lien or security interest purported to be created
by any security agreement, pledge agreement, assignment or other security
document heretofore or hereafter executed by any Guarantor as security for all
or part of the Obligations or the Guarantees.
"Guarantor Collateral Documents": the Guarantor Security Agreements, all
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notices of security interests in deposit accounts requested by the Agent
pursuant to the Guarantor Security Agreements, Form UCC-1 Financing Statements
and amendments thereto and any other document executed by any Guarantor
encumbering the Guarantor Collateral or evidencing or perfecting a security
interest therein in favor of the Agent for the benefit of the Lenders.
"Guarantor Security Agreements": each security agreement (which, in the
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case of Xxxxxx X. Xxxxx and Xxxxxx X. Xxxxxxxxx, shall be only with respect to
their equity interests in the Entravision License Subsidiary), in form and
substance substantially identical to those executed in connection with the
Entravision Credit Agreement, made by each Guarantor in favor of the Agent, for
the benefit of the Lenders, as the same may be amended from time to time in
accordance with the terms hereof.
"Guarantors": (i) each Subsidiary of the Borrower, (ii) Xxxxxx X. Xxxxx,
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(iii) Xxxxxx X. Xxxxxxxxx, (iv) Entravision and (v) each Subsidiary of
Entravision other than the Borrower, including but not limited to the
Entravision License Subsidiary.
"Indebtedness": of any Person at any date, without duplication, (a) all
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indebtedness of such Person for borrowed money or for the deferred purchase
price of property or services (other than (i) current trade liabilities incurred
in the ordinary course of business and payable in accordance with customary
practices and (ii) current income taxes) or that is evidenced by a note, bond,
debenture or similar instrument, (b) all obligations of such Person under
Capitalized Lease Obligations, (c) all obligations of such Person in respect of
acceptances issued or created for the account of such Person, (d) all
liabilities secured by any Lien on any property owned by such Person even though
such Person has not assumed or otherwise become liable for the payment thereof,
(e) all obligations of such Person, whether absolute or contingent, in respect
of letters of credit opened for the account of such Person (other than any
letters of credit opened for the purpose of facilitating the purchase of goods
and services in the ordinary course of business and having a term of not more
than 360 days), (f) all obligations of such Person under Non-Compete Agreements
and (g) all Guarantee Obligations of such Person in respect of any indebtedness,
obligations or liabilities of any other Person of the type referred to in
clauses (a) through (f) of this definition.
"Insolvency": with respect to any Multiemployer Plan, the condition that
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such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
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"Intellectual Property": as defined in Section 3.5.
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"Intercreditor Agreement": the Intercreditor Agreement, in form and
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substance satisfactory to the Agent and the Lenders, between the Agent, on
behalf of the Lenders, and the
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"Agent" under the Entravision Credit Agreement, on behalf of the lenders
thereunder, as amended, waived, supplemented or otherwise modified from time to
time.
"Interest Expense": for any specified period ended as of any specified
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date, (A) the sum of (i) the amount of all interest on Total Debt which was
paid, payable and/or accrued for such period (without duplication of previous
amounts), (ii) all commitment fees paid, payable and/or accrued for such period
(without duplication of previous amounts) to any lender in exchange for such
lender's commitment to lend and (iii) net amounts payable (or receivable) under
all Interest Rate Agreements, less (B) all interest income.
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"Interest Payment Date": (a) as to any Base Rate Loan, the last day of
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each March, June, September and December to occur while the Loans are
outstanding, (b) as to any LIBOR Loan having an Interest Period of three months
or less, the last day of such Interest Period, (c) as to any LIBOR Loan having
an Interest Period longer than three months, each day which is at the end of
each three month-period within such Interest Period after the first day of such
Interest Period and the last day of such Interest Period and (d) for each of
(a), (b) and (c) above, on the day on which the Loans become due and payable in
full or are paid or prepaid in full.
"Interest Period": with respect to any LIBOR Loan:
---------------
(a) initially, the period commencing on the borrowing or conversion date,
as the case may be, with respect to such LIBOR Loan and ending one, two, three
or six months thereafter, as selected by the Borrower in its notice of borrowing
or Continuation Notice, as the case may be, given with respect thereto; and
(b) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such LIBOR Loan and ending one, two,
three or six months thereafter, as selected by the Borrower by irrevocable
notice to the Agent not less than three Eurodollar Business Days prior to the
last day of the then current Interest Period with respect thereto;
provided that, all of the foregoing provisions relating to Interest Periods are
--------
subject to the following:
(i) if any Interest Period would otherwise end on a day that is not
a Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless the result of such extension would be to carry such Interest
Period into another calendar month in which event such Interest Period shall end
on the immediately preceding Business Day;
(ii) any Interest Period that would otherwise extend beyond the
Maturity Date shall end on the Maturity Date;
(iii) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
(iv) the Borrower shall select Interest Periods so as not to require
a payment or prepayment of any LIBOR Loan during an Interest Period.
-9-
"Interest Rate Agreement": any interest rate protection agreement,
-----------------------
interest rate future, interest rate option, interest rate swap, interest rate
cap or other interest rate hedge or arrangement entered into pursuant to Section
5.13 with any Lender or any Affiliate of a Lender under which the Borrower is a
party or a beneficiary.
"Interest Reserve Account": a bank account to be established and
------------------------
maintained at Union Bank of California, N.A., Los Angeles, under the control of
the Agent, for the purpose of holding certain Loan proceeds to be used to pay
interest on the Loans until the funds in such account are exhausted or, if
earlier, the Obligations have been paid in full.
"Investment Company Act": as defined in Section 3.22.
----------------------
"LCGAC": as defined in the preamble hereto.
-----
"LCG License Subsidiary": LCG Holdings, L.L.C., a Delaware limited
----------------------
liability company, which is wholly-owned by the Borrower and was formed solely
for the purpose of holding Media Licenses and FCC files and records with respect
thereto.
"Lenders": as defined in the preamble hereto and Section 8.8 hereof. When
-------
used in any Collateral Document, Guarantee or Guarantor Collateral Document,
such term shall be deemed to include Affiliates of Lenders (and any Person that
was a Lender or an Affiliate of a Lender at the time of its entry into an
Interest Rate Agreement), to the extent the Borrower has Obligations to such
Person arising under an Interest Rate Agreement, it being understood that such
documents shall secure such Obligations ratably with all other Obligations.
"LIBOR": with respect to each day during each Interest Period pertaining
-----
to a LIBOR Loan, the rate of interest determined by the Agent to be the rate per
annum at which deposits in dollars would be offered to the Agent by leading
banks in the London Interbank Market at or about 9:00 a.m., Los Angeles time,
two Eurodollar Business Days prior to the beginning of such Interest Period, for
delivery on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of its LIBOR Loan to
be outstanding during such Interest Period.
"LIBOR Adjusted Rate": with respect to each day during each Interest
-------------------
Period pertaining to a LIBOR Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):
LIBOR
-----------------------------------
1.00 - LIBOR Reserve Requirements
"LIBOR Loans": that portion of the Loans the rate of interest applicable
-----------
to which is based upon LIBOR.
"LIBOR Reserve Requirements": for any day as applied to a LIBOR Loan, the
--------------------------
aggregate (without duplication) of the maximum rates (expressed as a decimal
fraction) of reserve requirements in effect on such day (including, without
limitation, basic, supplemental, marginal and emergency reserves under any
regulations of the Board of Governors of the Federal Reserve System or other
Governmental Authority having jurisdiction with respect thereto) dealing with
-10-
reserve requirements prescribed for eurocurrency funding (currently referred to
as "Eurocurrency Liabilities" in Regulation D of such Board) maintained by a
member bank of such Federal Reserve System.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
----
arrangement, encumbrance, lien (statutory or other), or preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever (including, without limitation, any conditional sale or other title
retention agreement, any Capitalized Lease Obligation having substantially the
same economic effect as any of the foregoing, and the filing of any financing
statement under the Uniform Commercial Code or comparable law of any
jurisdiction in respect of any of the foregoing).
"Loan" and "Loans": collectively, each term loan made under Section
---- -----
2.1(a).
"Loan Documents": this Agreement, the Notes, the Collateral Documents, the
--------------
Guarantor Collateral Documents, the Intercreditor Agreement, the Guarantees, any
Interest Rate Agreements, and the closing side letter referred to in Section
4.1(g) and any other agreement executed by an Obligor in connection therewith
and herewith including, but not limited to, UCC-1 Financing Statements, as such
agreements and documents may be amended, supplemented and otherwise modified
from time to time in accordance with the terms hereof.
"Majority Lenders": Lenders having Commitments equal to or more than 51%
----------------
of the Aggregate Commitment, or, following the termination of the Aggregate
Commitment, Lenders with outstanding Loans having an unpaid principal balance
equal to or more than 51% of the unpaid principal balance of all Loans
outstanding, excluding from such calculation Lenders which have failed or
refused to fund a Loan when required to do so.
"Margin Stock": as defined in Regulation U.
------------
"Material Adverse Effect": a material adverse effect on (a) the business,
-----------------------
operations, property, condition or prospects (financial or otherwise) of the
Borrower and its Subsidiaries (taken as a whole) or Entravision and its
Subsidiaries (other than the Borrower and its Subsidiaries), taken as a whole,
(b) the ability of the Borrower and its Subsidiaries (taken as a whole) or
Entravision and its Subsidiaries (other than the Borrower and its Subsidiaries),
taken as a whole to perform their respective obligations under the Loan
Documents or (c) the validity or enforceability of the Loan Documents or the
rights or remedies of the Agent and the Lenders hereunder or thereunder.
"Material Contracts": as defined in Section 3.8.
------------------
"Maturity Date": the earlier of (i) April 18, 2001 or such earlier date as
-------------
the Loans shall mature (whether by acceleration or otherwise) and (ii)
consummation of the Entravision IPO.
"Media Licenses": any franchise, license, permit, certificate, ordinance,
--------------
approval or other authorization, or any renewal or extension thereof, from any
federal, state or local government or governmental agency, department or body
that is necessary for the radio broadcasting operations of the Borrower or any
Subsidiaries.
-11-
"Merger": as defined in the Recitals hereto.
------
"Merger Agreement": as defined in the Recitals hereto.
----------------
"Multiemployer Plan": a plan which is a multiemployer plan as defined in
------------------
Section 4001(a)(3) of ERISA.
"Net Income": for the Borrower and its Subsidiaries on a consolidated
----------
basis, net income as determined in accordance with GAAP.
"Non-Compete Agreements": all agreements pursuant to which the Borrower or
----------------------
any Subsidiary has agreed to make payments (whether in cash or in kind) to
another Person for the agreement of such Person not to compete with the Borrower
or such Subsidiary in a given area.
"Note": as defined in Section 2.1(c).
----
"Obligations": the unpaid principal of and interest on (including, without
-----------
limitation, interest accruing after the maturity of the Loans and interest
accruing on or after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding and whether or not at a default rate) the Notes,
all obligations of the Borrower to any Lender or Affiliate of a Lender (or any
Person that was a Lender or Affiliate of a Lender at the time of its entry into
an Interest Rate Agreement) arising under any Interest Rate Agreement, and all
other obligations and liabilities of the Borrower to the Agent and the Lenders,
whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, this Agreement, the Notes, any other Loan Document and any other document
made, delivered or given in connection herewith or therewith, whether on account
of principal, interest, fees, indemnities, costs, expenses (including, without
limitation, all reasonable fees and disbursements of counsel, and the allocated
reasonable cost of internal counsel, to the Agent or the Lenders that are
required to be paid by the Borrower pursuant to the terms of this Agreement) or
otherwise.
"Obligor": the Borrower, LCG, each Subsidiary, each Guarantor and any
-------
other Person (other than a Lender) obligated under any Loan Document.
"Occupancy Agreements": as defined in Section 5.14.
--------------------
"Operating Cash Flow": for any specified period ended as of any specified
-------------------
date, Net Income after eliminating extraordinary gains and losses, plus (i)
----
provisions for taxes, (ii) depreciation and amortization, (iii) Interest
Expense, (iv) permitted termination payments owing by the Borrower resulting
from early termination of a time brokerage agreement, local marketing agreement
or similar agreement, (v) operating losses from Stations KVBC-FM and KRNV-FM, to
the extent that such losses are incurred during the first twelve months of such
Stations being on the air, and (vi) other non-cash charges, all to the extent
deducted from the computation of Net Income, but after deducting, without
duplication, (A) non-cash revenues and (B) Corporate Overhead, all to the extent
included in the calculation of Net Income.
-12-
"Organic Documents": relative to any entity, its certificate and articles
-----------------
of incorporation or organization, its by-laws or operating agreements, and all
Equityholder Agreements, voting agreements and similar arrangements applicable
to any of its authorized shares of capital stock, its partnership interests or
its member interests, and any other arrangements relating to the control or
management of any such entity (whether existing as corporation, a partnership, a
limited liability company or otherwise).
"Participant": as defined in Section 9.6(b).
-----------
"PBGC": the Pension Benefit Guaranty Corporation established pursuant to
----
Subtitle A of Title IV of ERISA or any successor thereto.
"Person": any individual, firm, partnership, joint venture, corporation,
------
association, limited liability company, business enterprise trust,
unincorporated organization, government or department or agency thereof or other
entity, whether acting in an individual, fiduciary or other capacity.
"Plan": as to any Person, any plan (other than a Multiemployer Plan)
----
subject to Title IV of ERISA maintained for employees of such Person or any
ERISA Affiliate of such Person (and any such plan no longer maintained by such
Person or any of such Person's ERISA Affiliates to which such Person or any of
such Person's ERISA Affiliates has made or was required to make any
contributions within any of the five preceding years).
"Program Services Agreements": any local marketing agreement, time
---------------------------
brokerage agreement, program services agreement or similar agreement providing
for the Borrower or its Subsidiaries (other than License Subsidiaries) to
program or sell advertising on all or any portion of the broadcast time of any
television or radio station.
"Prohibited Transaction": with respect to any Plan, a prohibited
----------------------
transaction (as defined in Section 406 of ERISA) with respect to such Plan.
"Properties": the collective reference to the real and personal property
----------
owned, leased, used, occupied or operated, under license or permit, by the
Borrower and its Subsidiaries.
"Purchasing Lenders": as defined in Section 9.6(c).
------------------
"Register": as defined in Section 9.6(d).
--------
"Regulation D": Regulation D of the Board of Governors of the Federal
------------
Reserve System, as the same is from time to time in effect, and all official
rulings and interpretations thereunder or thereof and any successor regulation
thereto.
"Regulation U": Regulation U of the Board of Governors of the Federal
------------
Reserve System, as the same is from time to time in effect, and all official
rulings and interpretations thereunder or thereof and any successor regulation
thereto.
"Reorganization": with respect to any Multiemployer Plan, the condition
--------------
that such plan is in reorganization within the meaning of Section 4241 of ERISA.
-13-
"Reportable Event": any of the events set forth in Section 4043(b) of
----------------
ERISA, other than those events as to which the thirty-day notice period is
waived under PBGC regulations.
"Requirement of Law": as to any Person, the Organic Documents of such
------------------
Person, and any law, treaty, rule or regulation, determination or policy
statement or interpretation of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject.
"Responsible Officer": with respect to any Person, the chief executive
-------------------
officer, the president, the managing member or members (as applicable, with
respect to any limited liability company), any executive vice president, any
senior vice president or any vice president or, with respect to financial
matters, the chief financial officer, treasurer or controller.
"Security Agreement": the Security Agreement in form and substance
------------------
reasonably satisfactory to the Majority Lenders, made by the Borrower in favor
of the Agent, for the benefit of the Lenders, in respect of the tangible and
intangible personal property of the Borrower described therein, as the same may
be amended from time to time in accordance with the terms hereof.
"Single Employer Plan": any Plan which is covered by Title IV of ERISA,
--------------------
but which is not a Multiemployer Plan.
"Solvent": when used with respect to any Person, that:
-------
(i) the present fair salable value of such Person's assets is in
excess of the total amount of the probable liability on such Person's
liabilities;
(ii) such Person is able to pay its debts as they become due; and
(iii) such Person does not have unreasonably small capital to carry on
such Person's business as theretofore operated and all businesses in which
such Person is about to engage.
"Station": any radio station now or hereafter owned, leased or operated by
-------
the Borrower or any of its Subsidiaries.
"Subsidiary": as to any Person at any time of determination, a
----------
corporation, partnership or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of
such corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries or Subsidiaries, or both, by such Person. Unless
otherwise qualified, all references to a "Subsidiary" or to "Subsidiaries" in
this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.
"Taxes": as defined in Section 2.12(a).
-----
-14-
"Termination Event": (i) a Reportable Event, (ii) the institution of
-----------------
proceedings to terminate a Single Employer Plan by the PBGC under Section 4042
of ERISA, (iii) the appointment by the PBGC of a trustee to administer any
Single Employer Plan or (iv) the existence of any other event or condition that
would reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment by the PBGC of a trustee to
administer, any Single Employer Plan.
"Total Debt": the aggregate principal amount of all Indebtedness
----------
(including Capitalized Lease Obligations) of the Borrower and its Subsidiaries.
"Total Interest Coverage Ratio": the ratio of Operating Cash Flow to
-----------------------------
Interest Expense.
"Tranche": the collective reference to LIBOR Loans the Interest Periods
-------
with respect to all of which begin on the same date and end on the same later
date (whether or not such LIBOR Loans shall originally have been made on the
same day).
"Transferee": as defined in Section 9.6(f).
----------
"Type": as to any Loan, its nature as a Base Rate Loan or a LIBOR Loan.
----
"Univision": as applicable, Univision Communications Inc., a Delaware
---------
corporation, or The Univision Network Limited Partnership, a Delaware limited
partnership.
"Voting Control": (i) with respect to any corporation, the power to elect a
--------------
majority of the board of directors of such corporation and (ii) with respect to
Entravision, ownership of a Majority in Interest (as defined in the Operating
Agreement) of each class of membership units of Entravision having voting power.
1.2 Other Definitional Provisions.
-----------------------------
(a) Unless otherwise specified therein, all terms defined in this
Agreement shall have the defined meanings when used in the Notes, any other Loan
Document or any certificate or other document made or delivered pursuant hereto
or thereto.
(b) As used herein, in the Notes, in any other Loan Document, and in any
certificate or other document made or delivered pursuant hereto or thereto,
accounting terms not defined in Section 1.1 and accounting terms partly defined
in Section 1.1, to the extent not defined, shall have the respective meanings
given to them under GAAP.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, subsection,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.
(d) The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.
-15-
(e) For the purpose of determining financial covenant compliance hereunder
for any period, divestitures and asset sales occurring during such period will
be included in the calculations for such period on a pro forma basis, and will
be deemed to have occurred on the first day of such period.
SECTION 2. AMOUNT AND TERMS OF LOANS; COMMITMENT AMOUNTS
2.1 Loans; Commitment Amounts.
-------------------------
(a) Subject to the terms and conditions hereof, each Lender severally
agrees to make a term loan through its Applicable Lending Office to the Borrower
on the Closing Date in accordance with the provisions of this Agreement in an
aggregate principal amount equal to the amount of the Commitment of such Lender.
After the making of such Loans, each Commitment, and the Aggregate Commitment,
shall terminate.
(b) Subject to Sections 2.8 and 2.10, the Loans may from time to time be
(i) LIBOR Loans, (ii) Base Rate Loans or (iii) a combination thereof, as
determined by the Borrower and notified to the Agent in accordance with either
Section 2.1(d) or 2.4. Each Lender may make or maintain its Loan to the Borrower
by or through any Applicable Lending Office.
(c) The Loan made by each Lender to the Borrower shall be evidenced by a
promissory note of the Borrower, substantially in the form of Exhibit A (a
"Note"), with appropriate insertions therein as to payee, date and principal
----
amount, payable to the order of such Lender and representing the obligations of
the Borrower to pay the aggregate unpaid principal amount of the Loan made by
such Lender to the Borrower in accordance with the terms of this Agreement, with
interest thereon as prescribed in Sections 2.6 and 2.7. Each Lender is hereby
authorized (but not required) to record the date and amount of each payment or
prepayment of principal of its Loan made to the Borrower, each continuation
thereof, each conversion of all or a portion thereof to another Type and, in the
case of LIBOR Loans, the length of each Interest Period with respect thereto, in
the books and records of such Lender, and any such recordation shall constitute
prima facie evidence of the accuracy of the information so recorded. The
----- -----
failure of any Lender to make any such recordation or notation in the books and
records of the Lender (or any error in such recordation or notation) shall not
affect the obligations of the Borrower hereunder or under the Notes. Each Note
shall (i) be dated the Closing Date, (ii) provide for the payment of interest in
accordance with Sections 2.6 and 2.7 and (iii) be stated to be payable on the
Maturity Date.
(d) The Borrower shall give the Agent irrevocable written notice (which
notice must be received by the Agent prior to 10:00 A.M., Los Angeles time, one
Business Day prior to, or if all or any part of the Loans are requested to be
made as LIBOR Loans, three Eurodollar Business Days prior to, the Closing Date)
requesting that the Lenders make the Loans in accordance with their respective
Commitments on the Closing Date and specifying (i) subject to Section 2.1(b),
whether the Loans are to be LIBOR Loans, Base Rate Loans or a combination
thereof and (ii) if the Loans are to be entirely or partly LIBOR Loans, the
respective amounts of each such Type of Loan and the respective lengths of the
initial Interest Periods therefor. Upon receipt of such notice, the Agent shall
promptly notify each Lender thereof. Not later than 12:00 noon, Los Angeles time
on the Closing Date, each Lender shall make available to the Agent at its office
-16-
specified in Section 9.2 the amount of such Lender's Commitment in immediately
available funds. The Agent may, in the absence of notification from any Lender
that such Lender has not made its pro rata share available to the Agent, on such
date, credit the account of the Borrower on the books of such office of the
Agent with the aggregate amount of Loans.
(e) All outstanding Loans shall be due and payable, to the extent not
previously paid in accordance with the terms hereof, on the Maturity Date.
(f) Neither the Agent nor any Lender shall be responsible for the
obligation or Commitment of any other Lender hereunder, nor will the failure of
any Lender to comply with the terms of this Agreement relieve any other Lender
or the Borrower of its obligations under this Agreement and the Notes. Nothing
herein shall be deemed to relieve any Lender from its obligation to fulfill its
Commitment hereunder or to prejudice any rights which the Borrower may have
against any Lender as a result of any default by such Lender hereunder.
2.2 Optional Prepayments. The Borrower may on the last day of any
--------------------
Interest Period with respect thereto, in the case of LIBOR Loans, or at any time
and from time to time, in the case of Base Rate Loans, prepay the Loans, in
whole or in part, without premium or penalty, upon at least three Business Days'
irrevocable written notice, in the case of LIBOR Loans, and upon at least one
Business Day's irrevocable written notice, in the case of Base Rate Loans, from
the Borrower to the Agent, specifying the date and amount of prepayment and
whether the prepayment is of LIBOR Loans, Base Rate Loans or a combination
thereof, and, if of a combination thereof, the amount allocable to each. Amounts
prepaid may not be reborrowed. Upon receipt of any such notice from the
Borrower, the Agent shall promptly notify each Lender thereof. If any such
notice is given, the amount specified in such notice shall be due and payable by
the Borrower on the date specified therein, together with accrued interest to
such date on the amount prepaid. Partial prepayments of Loans shall be in an
aggregate principal amount of $1,000,000 and integral multiples of $250,000 in
excess thereof.
2.3 Mandatory Prepayments.
---------------------
(a) If the Borrower or any of its Subsidiaries receives insurance proceeds
or condemnation proceeds with respect to any of their Properties that are not
fully applied (or contractually committed pursuant to contract(s) approved by
the Agent in its reasonable discretion) toward the repair or replacement of such
damaged or condemned Property within 90 days of the receipt thereof, the
Borrower shall, on such 90th day prepay the Loans in an amount equal to the
amount of such proceeds not so applied.
(b) Each prepayment of the Loans pursuant to this Section 2.3 shall be
accompanied by payment in full of all accrued interest to and including the date
of such prepayment, together with any additional amounts owing pursuant to
Section 2.13.
2.4 Conversion and Continuation Options.
-----------------------------------
(a) The Borrower may elect from time to time to convert LIBOR Loans to
Base Rate Loans, by the Borrower giving the Agent at least two Business Days'
prior irrevocable written notice of such election pursuant to a Continuation
Notice, provided that any such conversion of LIBOR Loans may only be made on the
last day of an Interest Period with respect thereto. The
-17-
Borrower may elect from time to time to convert Base Rate Loans to LIBOR Loans
by the Borrower giving the Agent at least three Eurodollar Business Days' prior
irrevocable written notice of such election pursuant to a Continuation Notice.
Any such notice of conversion to LIBOR Loans shall specify the length of the
initial Interest Period or Interest Periods therefor. Upon receipt of any such
notice, the Agent shall promptly notify each Lender thereof. All or any part of
outstanding LIBOR Loans and Base Rate Loans may be converted as provided herein,
provided that (i) any such conversion may only be made if, after giving effect
thereto, Section 2.5 shall not have been contravened, (ii) no Loan may be
converted into a LIBOR Loan after the date that is one month prior to the
Maturity Date and (iii) the Borrower shall not have the right to elect to
continue at the end of the applicable Interest Period, or to convert to, a LIBOR
Loan if a Default shall have occurred and be continuing.
(b) Any LIBOR Loan may be continued as such upon the expiration of the
then current Interest Period with respect thereto by the Borrower giving notice
to the Agent, in accordance with the applicable provisions of the term "Interest
Period" set forth in Section 1.1, of the length of the next Interest Period to
be applicable to such LIBOR Loan, provided that no LIBOR Loan may be continued
--------
as such (i) if, after giving effect thereto, Section 2.5 would be contravened,
(ii) after the date that is one month prior to the Maturity Date or (iii) if a
Default shall have occurred and be continuing and provided, further, that if the
-------- -------
Borrower shall fail to give any required notice as described above in this
Section or if such continuation is not permitted pursuant to the preceding
proviso, such Loans shall be automatically converted to Base Rate Loans on the
last day of such then-expiring Interest Period.
2.5 Minimum Amounts of Tranches. All borrowings, conversions and
---------------------------
continuations of Loans hereunder and all selections of Interest Periods
hereunder shall be in such amounts and be made pursuant to such elections so
that, after giving effect thereto, the aggregate principal amount of the Loans
comprising each Tranche shall be equal to $1,000,000 or a whole multiple of
$100,000 in excess thereof and, in any case, there shall not be more than 12
Tranches.
2.6 Interest Rates and Payment Dates.
--------------------------------
(a) Each LIBOR Loan shall bear interest for each day during each Interest
Period with respect thereto at a rate per annum equal to the LIBOR Adjusted Rate
plus the Applicable Margin.
(b) Each Base Rate Loan shall bear interest at a rate per annum equal to
the Base Rate plus the Applicable Margin.
(c) If any Default shall have occurred and be continuing, all amounts
outstanding shall bear interest at a rate per annum which is the rate described
in paragraph (b) of this Section plus 2% from the date of the occurrence of such
Default until such Default is no longer continuing (after as well as before
judgment).
(d) Interest shall be payable in arrears on each Interest Payment Date,
provided that interest accruing pursuant to paragraph (c) of this Section shall
be payable on demand.
-18-
(e) If and so long as funds are available in the Interest Reserve Account,
the Agent shall deduct funds from the Interest Reserve Account, and shall
distribute such funds pro rata to the Lenders, to pay interest due and payable
on the Loans.
2.7 Computation of Interest and Fees.
--------------------------------
(a) Interest on Base Rate Loans (other than Base Rate Loans based on the
Federal Funds Effective Rate) shall be calculated on the basis of a 365- (or
366-, as the case may be) day year for the actual days elapsed, and interest on
LIBOR Loans and all other Obligations of the Borrower shall be calculated on the
basis of a 360-day year for the actual days elapsed. The Agent shall as soon as
practicable notify the Borrower and the Lenders of each determination of a LIBOR
Adjusted Rate. Any change in the interest rate on a Loan resulting from a change
in the Base Rate or the LIBOR Reserve Requirements shall become effective as of
the opening of business on the day on which such change in the Base Rate is
announced or such change in the LIBOR Reserve Requirements becomes effective, as
the case may be. The Agent shall as soon as practicable notify the Borrower and
the Lenders of the effective date and the amount of each such change in interest
rate.
(b) Each determination of an interest rate by the Agent pursuant to any
provision of this Agreement shall be conclusive and binding on the Borrower and
the Lenders in the absence of manifest error.
2.8 Inability to Determine Interest Rate. In the event that prior to the
------------------------------------
first day of any Interest Period:
(a) the Agent shall have determined (which determination shall be
conclusive and binding upon the Borrower absent manifest error) that, by reason
of circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the LIBOR Adjusted Rate for such Interest Period, or
(b) the Agent shall have received notice from the Majority Lenders acting
in good faith that the LIBOR Adjusted Rate determined or to be determined for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (as conclusively certified by such Lenders) of making or maintaining
their affected Loans during such Interest Period, the Agent shall give telecopy
or telephonic notice thereof to the Borrower and the Lenders as soon as
practicable thereafter. If such notice is given (x) any LIBOR Loans requested to
be made on the first day of such Interest Period shall accrue interest at the
Base Rate, (y) Loans that were to have been converted on the first day of such
Interest Period to LIBOR Loans shall be continued as Base Rate Loans and (z) any
outstanding LIBOR Loans shall be converted, on the first day of such Interest
Period, to Base Rate Loans. Until such notice has been withdrawn by the Agent,
no further LIBOR Loans shall be made or continued as such, nor shall the
Borrower have the right to convert Base Rate Loans to LIBOR Loans.
2.9 Pro Rata Treatment and Payments. The borrowing by the Borrower from
-------------------------------
the Lenders hereunder shall be made pro rata according to the respective
Commitment Percentages of the applicable Lenders. Each payment (including each
prepayment) by the Borrower on account of principal of and interest on the Loans
shall be made pro rata according to the respective
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outstanding principal and interest amounts of the Loans then held by the
Lenders. All payments (including prepayments) to be made by the Borrower
hereunder and under the Notes, whether on account of principal, interest, fees
or otherwise, shall be made without set off or counterclaim and shall be made
prior to 12:00 noon, Los Angeles time, on the due date thereof to the Agent, for
the account of the applicable Lenders, at the Agent's office specified in
Section 9.2, in Dollars and in immediately available funds. The Agent shall
distribute such payments to the applicable Lenders promptly upon receipt in like
funds as received. If any payment hereunder (other than payments on the LIBOR
Loans) becomes due and payable on a day other than a Business Day, such payment
shall be extended to the next succeeding Business Day, and, with respect to
payments of principal, interest thereon shall be payable at the then applicable
rate during such extension. If any payment on a LIBOR Loan becomes due and
payable on a day other than a Eurodollar Business Day, the maturity thereof
shall be extended to the next succeeding Eurodollar Business Day (and interest
shall continue to accrue thereon at the applicable rate) unless the result of
such extension would be to extend such payment into another calendar month, in
which event such payment shall be made on the immediately preceding Eurodollar
Business Day.
2.10 Illegality. Notwithstanding any other provision herein, if any change
----------
after the Closing Date in any Requirement of Law or in the interpretation or
application thereof shall make it unlawful for any Lender or Applicable Lending
Office to make or maintain LIBOR Loans as contemplated by this Agreement, (a)
the commitment of such Lender hereunder to make LIBOR Loans, continue LIBOR
Loans as such and convert Base Rate Loans to LIBOR Loans shall forthwith be
suspended during such period of illegality and (b) the Loans of such Lender or
Applicable Lending Office then outstanding as LIBOR Loans, if any, shall be
converted automatically to Base Rate Loans on the respective last days of the
then current Interest Periods with respect to such Loans or within such earlier
period as required by law. If any such conversion of a LIBOR Loan occurs on a
day which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to Section 2.13. To the extent that a Lender's LIBOR Loans
have been converted to Base Rate Loans pursuant to this Section 2.10, all
payments and prepayments of principal that otherwise would be applied to such
Lender's LIBOR Loans shall be applied instead to its Base Rate Loans.
2.11 Increased Costs.
---------------
(a) In the event that any change after the Closing Date in any Requirement
of Law or in the interpretation or application thereof or compliance by any
Lender with any request or directive (whether or not having the force of law
but, if not having the force of law, generally applicable to and complied with
by banks and financial institutions of the same general type as such Lender in
the relevant jurisdiction) from any central bank or other Governmental Authority
made subsequent to the date hereof:
(i) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirements against assets held by,
letters of credit or guarantees issued by, deposits or other liabilities in
or for the account of, advances, loans or other extensions of credit by, or
any other acquisition of funds by, any office of such
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Lender or Applicable Lending Office which is not otherwise included in the
determination of the LIBOR Adjusted Rate hereunder; or
(ii) shall impose on such Lender or Applicable Lending Office any
other condition;
and the result of any of the foregoing is to increase the cost to such Lender or
Applicable Lending Office, by an amount which such Lender deems to be material,
of making, converting into, continuing or maintaining LIBOR Loans or to reduce
any amount receivable hereunder in respect thereof then, in any such case, the
Borrower shall immediately pay to the Agent, on behalf of such Lender or
Applicable Lending Office, as applicable, upon the request of such Lender any
additional amounts necessary to compensate such Lender for such increased cost
or reduced amount receivable. If any Lender or any Applicable Lending Office
becomes entitled to claim any additional amounts pursuant to this Section, it
shall promptly notify the Borrower, through the Agent, of the event by reason of
which it has become so entitled. A certificate as to any additional amounts
payable pursuant to this Section submitted by such Lender or Applicable Lending
Office, through the Agent, to the Borrower shall be conclusive evidence of the
accuracy of the information so recorded, absent manifest error. The obligations
of the Borrower under this Section 2.11(a) shall survive the termination of this
Agreement and the payment of the Loans, the Notes and all other amounts payable
hereunder.
(b) If, after the date of this Agreement, the introduction of or any
change in any applicable law, rule, regulation or guideline regarding capital
adequacy, or any change in the interpretation or administration thereof by any
Governmental Authority charged with the interpretation or administration
thereof, affects the amount of capital required or expected to be maintained by
any Lender or any corporation controlling any Lender, and such Lender (taking
into consideration such Lender's or such corporation's policies with respect to
capital adequacy) determines that the amount of capital maintained by such
Lender or such corporation, which is attributable to or based upon the Loans,
the Commitments or this Agreement, must be increased as a consequence of such
introduction or change by an amount deemed by such Lender to be material, then,
upon demand of the Agent at the request of such Lender, the Borrower shall
immediately pay to the Agent on behalf of such Lender, additional amounts
sufficient to compensate such Lender or such corporation for the increased costs
to such Lender or corporation of such increased capital. Any such demand shall
be accompanied by a certificate of such Lender setting forth in reasonable
detail the computation of any such increased costs, which certificate shall be
conclusive, absent manifest error. The obligations of the Borrower under this
Section 2.11(b) shall survive the termination of this Agreement and the payment
of the Loans, the Notes and all other amounts payable hereunder.
2.12 Taxes.
-----
(a) All payments made by the Borrower in respect of the Obligations shall
be made free and clear of, and without deduction or withholding for or on
account of, any present or future income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority or any
political subdivision or taxing authority thereof or therein, other than
Excluded Taxes (all such non-Excluded Taxes being hereinafter called "Taxes").
If any
-21-
Taxes are required to be withheld from any amounts payable to the Agent or any
Lender in respect of the Obligations, the amounts so payable to the Agent or
such Lender shall be increased to the extent necessary to yield to the Agent or
such Lender (after payment of all Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in this Agreement and
the Notes. The Agent or a Lender, as the case may be, shall deliver to the
Borrower a certificate in good faith setting forth the amount of such Taxes, the
calculation of such Taxes and an explanation of the requirement therefor, all in
reasonable detail and such certificate shall be conclusive, absent manifest
error. Whenever any Taxes are payable by the Borrower, as promptly as possible
thereafter, the Borrower shall send to the Agent, for its own account or for the
account of such Lender, as the case may be, a copy of an original official
receipt received by the Borrower showing payment thereof or such other evidence
of payment reasonably satisfactory to the Agent. If the Borrower fails to pay
any Taxes when due to the appropriate taxing authority or fails to remit to the
Agent the required receipts or other required documentary evidence, the Borrower
shall indemnify the Agent and the Lenders for any incremental taxes, interest or
penalties (and related reasonable fees and expenses of counsel) that may become
payable by the Agent or any Lender as a result of any such failure. The
agreements in this Section shall survive the termination of this Agreement and
the payment of the Notes and all other amounts payable hereunder.
(b) Each Lender that is not organized under the laws of the United States
of America or a state thereof agrees that it will deliver to the Borrower and
the Agent (i) two duly completed copies of United States Internal Revenue
Service Form X-0, X-0XXX xx X-0XXX (as applicable to it) or successor applicable
form. Each such Lender also agrees to deliver to the Borrower and the Agent two
further copies of the said Form X-0, X-0XXX xx X-0XXX (as applicable to it), or
successor applicable forms or other manner or certification, as the case may be,
on or before the date that any such form expires or becomes obsolete or after
the occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower and the Agent, and such extensions or
renewals thereof as may reasonably be requested by the Borrower or the Agent,
unless in any such case an event beyond the control of such Lender (including,
without limitation, any change in treaty, law or regulation) has occurred prior
to the date on which any such delivery would otherwise be required, which
renders all such forms inapplicable or which would prevent such Lender from duly
completing and delivering any such form with respect to it, and such Lender so
advised the Borrower and the Agent. Each such Lender shall certify pursuant to
such Forms that it is entitled to receive payments under this Agreement and the
Notes without deduction or withholding of any United States federal income
taxes.
2.13 Indemnity. The Borrower agrees to indemnify each Lender and to hold
---------
each Lender harmless from and to pay each Lender within 5 Business Days of such
Lender's demand the amount of any liability, loss or expense arising from the
reemployment of funds obtained by it or from fees payable to terminate the
deposits from which such funds were obtained (including reasonable fees and
expenses of counsel) which such Lender may sustain or incur as a consequence of
(a) default by the Borrower in payment when due of the principal amount of or
interest on any LIBOR Loan, (b) default by the Borrower in making a borrowing
of, conversion into or continuation of LIBOR Loans after the Borrower has given
a notice requesting the same in accordance with the provisions of this
Agreement, (c) default by the Borrower in making any prepayment after the
Borrower has given a notice thereof in accordance with the provisions of this
Agreement or (d) the making by the Borrower of a prepayment or conversion of
LIBOR
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Loans on a day which is not the last day of an Interest Period with respect
thereto. A Lender's certificate as to such liability, loss or expense shall be
deemed conclusive, absent manifest error. This covenant shall survive the
termination of this Agreement and the payment of the Notes and all other amounts
payable hereunder.
2.14 Mitigation of Costs. If any Lender, by changing its Applicable
-------------------
Lending Office or taking any other reasonable action, so long as making such
change or taking such other action is not disadvantageous to it in any
financial, regulatory or other respect, can mitigate any adverse effect on the
Borrower under Section 2.8, 2.10, 2.11, or 2.12, such Lender shall take such
action.
SECTION 3. REPRESENTATIONS AND WARRANTIES
To induce the Lenders to enter into this Agreement and to make the Loans,
the Borrower hereby represents and warrants to the Agent and each Lender, such
representations to be given, with respect to the Closing Date, both before and
after the consummation of the Merger, that:
3.1 Organization and Good Standing. The Borrower and each Subsidiary (a)
------------------------------
is duly organized, validly existing and in good standing under the laws of its
jurisdiction of organization, (b) has all requisite power and authority
(corporate, partnership, limited liability company and otherwise) to own its
properties and to conduct its business as now conducted and as currently
proposed to be conducted and (c) is duly qualified to conduct business as a
foreign organization and is currently in good standing in each state and
jurisdiction in which it conducts business. Each state and jurisdiction in which
the Borrower or any Subsidiary is organized or is (or should be) qualified to
conduct business is listed on Schedule 3.1 hereto.
3.2 Power and Authority. The Borrower has all requisite power and
-------------------
authority under applicable law and under its Organic Documents to consummate the
Merger and to borrow hereunder. The Borrower and each Subsidiary has all
requisite power and authority under applicable law and under its Organic
Documents to execute, deliver and perform the obligations under the Loan
Documents to which it is a party. Except as disclosed on Schedule 3.2 hereto,
all actions, waivers and consents (corporate, regulatory and otherwise)
necessary or appropriate for the Borrower and each Subsidiary to execute,
deliver and perform the Loan Documents to which it is a party and for the
Borrower to consummate the Merger have been taken and/or received. Except as
provided in Section 4.1(r)(i), all applicable waiting periods in connection with
the Merger and the other transactions contemplated hereby have expired without
any action having been taken by any competent authority restraining, preventing
or imposing materially adverse conditions upon the Merger or the rights of the
Borrower of its Subsidiaries freely to transfer or otherwise dispose of, or to
create any Lien on, any properties now owned or hereafter acquired by any of
them.
3.3 Validity and Legal Effect. This Agreement constitutes, and the other
-------------------------
Loan Documents to which the Borrower or any Subsidiary is a party, constitute
(or will constitute when executed and delivered), the legal, valid and binding
obligations of the Borrower and each Subsidiary enforceable against it in
accordance with the terms thereof.
3.4 No Violation of Laws or Agreements. The execution, delivery and
----------------------------------
performance of the Loan Documents, (a) will not violate or contravene any
Requirement of Law, (b) will not
-23-
result in any material breach or violation of, or constitute a material default
under, any agreement or instrument by which the Borrower, any Subsidiary or any
of its respective properties may be bound, and (c) will not result in or require
the creation of any Lien (other than pursuant to the Loan Documents) upon or
with respect to any properties of the Borrower or any Subsidiary, whether such
properties are now owned or hereafter acquired.
3.5 Title to Assets; Existing Encumbrances; Intellectual and Real
-------------------------------------------------------------
Property. The Borrower and each Subsidiary has good and marketable title to all
--------
of its real and personal properties and assets, free and clear of any Liens,
except the security interests granted to the Agent for the benefit of the
Lenders under the Loan Documents. Schedule 3.5A hereto lists each trademark,
service xxxx, copyright, patent, database, customized application software and
systems integration software, trade secret and other intellectual property
owned, licensed, leased, controlled or applied for by the Borrower or any
Subsidiary (the "Intellectual Property"). To the Borrower's knowledge, no claim
---------------------
has been asserted and is pending by any Person challenging or questioning the
use of any such Intellectual Property or the validity or effectiveness of any
such Intellectual Property, nor does the Borrower know of any valid basis for
any such claim. To the Borrower's knowledge, the use of such Intellectual
Property by the Borrower and its Subsidiaries does not infringe on the rights of
any Person, nor, to the Borrower's knowledge, does the use by other Persons of
such Intellectual Property infringe on the rights of the Borrower and its
Subsidiaries. Schedule 3.5B hereto lists each real property interest and
license owned, leased or otherwise used by the Borrower or any Subsidiary,
together with relevant identifying information describing, among other things,
the location and use of each such real property interest or license, whether
such interest is owned or leased. Each such property and asset is in good order
and repair (ordinary wear and tear excepted) and is fully covered by the
insurance required under the Loan Documents. Each such property and asset owned
by the Borrower is titled in the current legal name of the Borrower. Each such
property and asset owned by any Subsidiary is titled in the current legal name
of such Subsidiary. The Borrower has not, and no Subsidiary has, used (or
permitted the filing of any financing statement under) any legal or operating
name at any time during the twelve consecutive calendar months immediately
preceding the execution of this Agreement, except as identified on Schedule 3.5C
hereto.
3.6 Capital Structure and Equity Ownership. Schedule 3.6 hereto
--------------------------------------
accurately and completely discloses (a) the number of shares and classes of
equity ownership rights and interests of the Borrower (whether existing as
common or preferred stock or warrants, options or other instruments convertible
into such equity) and (b) the ownership thereof. All such shares and interests
are validly existing, fully paid and non-assessable. There are no Equityholder
Agreements with respect to the Borrower or any Subsidiary.
3.7 Subsidiaries, Affiliates and Investments. Schedule 3.7 hereto
----------------------------------------
accurately and completely discloses (a) each Subsidiary and Affiliate of the
Borrower (other than its officers and directors) and (b) each investment in or
loan to any other Person by the Borrower or any Subsidiary.
3.8 Material Contracts. Schedule 3.8 hereto accurately and completely
------------------
discloses each contract and agreement material to the financial condition or
operation of the Borrower or any Subsidiary (each, a "Material Contract," and
-----------------
collectively, the "Material Contracts"). The Borrower has not, and no Subsidiary
------------------
has, committed any unwaived breach or default under any
-24-
Material Contract, and the Borrower has no knowledge or reason to believe that
any other party to any Material Contract has or might have committed any
unwaived breach or default thereof. Each of the Material Contracts is a legal,
valid and binding obligation of the Borrower and Subsidiary party thereto,
enforceable in accordance with its terms. The Agent has received a complete and
correct copy of each of the Material Contracts (including in each case all
exhibits, schedules and disclosure letters referred to therein or delivered
pursuant thereto, if any) and all amendments thereto and other side letters or
agreements affecting the terms thereof.
3.9 Media Licenses. The Borrower and each Subsidiary have obtained, and
--------------
are holding through the Entravision License Subsidiary or the LCG License
Subsidiary, all Media Licenses necessary or required in the conduct of their
respective businesses and/or the operation of their respective properties. Each
Media License is valid, binding and enforceable on, against and by the Borrower
or such Subsidiary, as applicable. Each Media License is subsisting without any
defaults thereunder or enforceable adverse limitations thereon, and no Media
License is subject to any proceedings or claims opposing the issuance, renewal,
development or use thereof or contesting the validity thereof. Schedule 3.9
hereto accurately and completely lists each material Media License directly or
indirectly owned by the Borrower (including, whether or not otherwise
"material", each Media License issued by the FCC, and further including all
pending applications and renewals therefor), together with relevant identifying
information describing such Media License. With respect to each FCC license
listed on Schedule 3.9 hereto, the description shall include, among other
things, the call sign, frequency, location, file number, issuance date (original
or most recent renewal), and expiration date.
3.10 Taxes and Assessments. Except as disclosed on Schedule 3.10 hereto,
---------------------
the Borrower and each Subsidiary has timely filed all required tax returns and
reports (federal, state and local) or has properly filed for extensions of the
time for the filing thereof. The Borrower has no knowledge of any deficiency,
penalty or additional assessment due or appropriate in connection with any such
taxes. All taxes (federal, state and local) imposed upon the Borrower or any
Subsidiary or any of its properties, operations or income have been paid and
discharged prior to the date when any interest or penalty would accrue for the
nonpayment thereof, except for those taxes being contested in good faith by
appropriate proceedings diligently prosecuted and with adequate reserves
reflected on the financial statements in accordance with GAAP (all as also
disclosed on Schedule 3.10 hereto). There are no taxes imposed on the Borrower
or its Subsidiaries by any political subdivision or taxing authority due or
payable either on or by virtue of the execution and delivery by the Borrower,
the Agent, or the Lenders of this Agreement or any other Loan Document to which
the Borrower or its Subsidiaries are party, or on any payment to be made by the
Borrower pursuant hereto or thereto.
3.11 Litigation and Legal Proceedings. Except as disclosed on Schedule
--------------------------------
3.11 hereto, there is no litigation, claim, investigation, administrative
proceeding, labor controversy or similar action that is pending or, to the best
of the Borrower's knowledge and information after due inquiry, threatened,
except as set forth in the following clauses (i) and (ii), (i) against the
Borrower, any Subsidiary or any Property that, if adversely resolved, could have
a Material Adverse Effect, (ii) with respect to any Loan Document or the
transactions contemplated thereby or (iii) with respect to the legality,
validity or enforceability of the Merger.
-25-
3.12 Accuracy of Financial Information.
---------------------------------
(a) All information previously furnished to the Agent and the Lenders
concerning the financial condition and operations of LCGAC and LCG, including
(i) a balance sheet of LCGAC dated the Closing Date showing no assets or
liabilities of LCGAC and (ii) the audited consolidated and consolidating
financial statements of LCG as of December 31, 1999, (A) have been prepared in
accordance with GAAP consistently applied, (B) are true, accurate and complete
in all material respects, (C) fairly present the financial condition of the
organizations covered thereby as of the dates and for the periods covered
thereby and (D) disclose all material liabilities (contingent and otherwise) of
LCGAC and LCG, respectively.
(b) (i) With respect to the balance sheet delivered pursuant to Section
3.12(a), since the Closing Date there has been no event or condition resulting
in a Material Adverse Effect and (ii) with respect to the audited financial
statements delivered pursuant to Section 3.12(a), since December 31, 1999 there
has been no event or condition resulting in a Material Adverse Effect.
3.13 Accuracy of Other Information. All information contained in any
-----------------------------
material application, schedule, report, certificate, or any other document given
to the Agent or any Lender by the Borrower or any other Person in connection
with the Loan Documents is in all material respects true, accurate and complete,
and no such Person has omitted to state therein (or failed to include in any
such document) any material fact or any fact necessary to make such information
not misleading. All projections given to the Agent or any Lender by the Borrower
or any other Person on behalf of the Borrower have been prepared with a
reasonable basis and in good faith making use of such information as was
available at the date such projection was made. The projections and pro forma
financial information contained in such materials are based upon good faith
estimates and assumptions believed by the Borrower to be reasonable at the time
made and as of the Closing Date, it being recognized that such projections as to
future events are not to be viewed as facts and that actual results during the
period or periods covered by any such projections may differ from the projected
results.
3.14 Compliance with Laws Generally. The Borrower and each Subsidiary is
------------------------------
in compliance in all material respects with all Requirements of Law applicable
to it, its operations and its properties.
3.15 ERISA Compliance.
----------------
(a) The Borrower and each Subsidiary is in compliance in all material
respects with all applicable provisions of ERISA, and all rules, regulations and
orders implementing ERISA.
(b) None of the Borrower, any Subsidiary or any ERISA Affiliate thereof
maintains or contributes to (or has maintained or contributed to) any
Multiemployer Plan under which the Borrower, any Subsidiary or any ERISA
Affiliate thereof could have any withdrawal liability.
(c) None of the Borrower, any Subsidiary or any ERISA Affiliate thereof
sponsors or maintains any defined benefit pension plan under which there is an
accumulated funding deficiency within the meaning of Section 412 of the Code,
whether or not waived.
-26-
(d) The liability for accrued benefits under each defined benefit pension
plan that will be sponsored or maintained by the Borrower, any Subsidiary or any
ERISA Affiliate thereof (determined on the basis of the actuarial assumptions
utilized by the PBGC) does not exceed the aggregate fair market value of the
assets under each such defined benefit pension plan.
(e) The aggregate liability of the Borrower, each Subsidiary and each
ERISA Affiliate thereof arising out of or relating to a failure of any employee
benefit plan within the meaning of Section 3(2) of ERISA to comply with
provisions of ERISA or the Code will not have a Material Adverse Effect.
(f) There does not exist any unfunded liability (determined on the basis
of actuarial assumptions utilized by the actuary for the plan in preparing the
most recent annual report) of the Borrower, any Subsidiary or any ERISA
Affiliate thereof under any plan, program or arrangement providing post-
retirement, life or health benefits.
(g) No Reportable Event and no Prohibited Transaction (as defined in
ERISA) has occurred or is occurring with respect to any plan with which the
Borrower or any Subsidiary is associated.
3.16 Environmental Compliance.
------------------------
(a) The Borrower and each Subsidiary has received all permits and filed
all notifications necessary under and is otherwise in compliance in all material
respects with all federal, state and local laws, rules and regulations governing
the control, removal, storage, transportation, spill, release or discharge of
hazardous or toxic wastes, substances and petroleum products, including, without
limitation, as provided in the provisions of and the regulations under (i) the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended by the Superfund Amendment and Reauthorization Act of 1986, (ii) the
Solid Waste Disposal Act, (iii) the Clean Water Act and the Clean Air Act, (iv)
the Hazardous Materials Transportation Act, (v) the Resource Conservation and
Recovery Act of 1976 and (vi) the Federal Water Pollution Control Act Amendments
of 1972 (all of the foregoing enumerated and non-enumerated statutes, including
without limitation any applicable state or local statutes, all as amended,
collectively, the "Environmental Control Statutes").
------------------------------
(b) The Borrower has not, and no Subsidiary has, given any written or oral
notice to the Environmental Protection Agency ("EPA") or any state or local
---
agency with regard to any actual or imminently threatened removal, storage,
transportation, spill, release or discharge of hazardous or toxic wastes,
substances or petroleum products either (i) on properties owned or leased by the
Borrower or such Subsidiary or (ii) otherwise in connection with the conduct of
its business and operations.
(c) The Borrower has not, and no Subsidiary has, received notice that it
is potentially responsible for costs of clean-up of any actual or imminently
threatened spill, release or discharge of hazardous or toxic wastes or
substances or petroleum products pursuant to any Environmental Control Statute.
(d) No judicial proceedings or governmental or administrative action is
pending, or, to the knowledge of the Borrower, threatened, under any
Environmental Control Statute to which
-27-
the Borrower or any of its Subsidiaries is named as a party with respect to the
Properties or the business conducted at the Properties, nor are there any
consent decrees or other decrees, consent orders, administrative orders or other
orders, or other administrative or judicial requirements outstanding under any
Environmental Control Statute with respect to the Properties or such business.
3.17 Federal Regulations. No part of the proceeds of any Loans are
-------------------
intended to be or will be used, directly or indirectly for any purpose which
violates the provisions of the Regulations of the Board of Governors of the
Federal Reserve System. If requested by any Lender or the Agent, and in any
event upon consummation of any acquisition involving the purchase of stock by
the Borrower or any Subsidiary, the Borrower will furnish to the Agent and each
Lender a statement to the foregoing effect in conformity with the requirements
of Form U-1 referred to in Regulation U.
3.18 Fees and Commissions. Except as disclosed on Schedule 3.18 hereto or
--------------------
as required by the letter referred to in Section 4.1(g), the Borrower does not
and will not owe, and no Subsidiary owes or will owe, any fees or commissions of
any kind in connection with this Agreement or the transactions contemplated
hereby, and the Borrower does not know of any claim (or any basis for any claim)
for any fees or commissions in connection with this Agreement or such
transactions.
3.19 Publishing Business. The Borrower and each Subsidiary possess all
-------------------
licenses necessary or required in the conduct of its publishing businesses
and/or the operation of its properties used in connection with such businesses.
Each license is valid, binding and enforceable on, against and by the Borrower
or such Subsidiary, as applicable. Each license is subsisting without any
defaults thereunder or enforceable adverse limitations thereon, and no such
license is subject to any proceedings or claims opposing the issuance, renewal,
development or use thereof or contesting the validity thereof. Each publication
owned or operated by the Borrower or any Subsidiary is listed on Schedule 3.19.
3.20 Solvency. Immediately prior to and upon the execution of this
--------
Agreement and the funding of the Loans on the Closing Date, the Borrower and
each Guarantor was, is and will be Solvent.
3.21 FCC-Related Representations. Without limiting the generality of the
---------------------------
foregoing representations and warranties, the Borrower further represents and
warrants as follows:
(a) Except as described on Schedule 3.21 hereto, there is no outstanding
or unresolved (i) application by the Borrower or any Subsidiary for any Media
License or by the Entravision License Subsidiary for any Entravision Media
License, including any renewal of any Media License or Entravision Media
License, (ii) to the best of the Borrower's knowledge, material complaint to the
FCC regarding the Borrower, any Subsidiary, the Entravision License Subsidiary,
any Media License or any Entravision Media License, (iii) litigation,
investigation or other inquiry by or before the FCC involving the Borrower, any
Subsidiary, the Entravision License Subsidiary, any Media License or any
Entravision Media License, or (iv) FCC enforcement proceeding against the
Borrower, any Subsidiary, the Entravision License
-28-
Subsidiary, any Media License or any Entravision Media License, including
without limitation, any notice of violation, any notice of apparent liability
for forfeiture, or any forfeiture.
(b) The Media Licenses identified on Schedule 3.9 hereto constitute all of
the Media Licenses required by the Communications Act for the operation of the
Borrower's and each Subsidiary's business as it is currently being operated.
Each such Media License is validly outstanding and effective and has been
renewed by the FCC without condition for a full term in accordance with the
Communications Act. There are no modifications, amendments or revocations
(pending or, to the best knowledge of the Borrower after due inquiry,
threatened) that could materially and adversely affect the operations or
financial condition of the Borrower, any Subsidiary or any Station. After due
inquiry, the Borrower does not know of any reason why the FCC would not
routinely grant, for a full term and without condition, the application by the
Borrower , any Subsidiary or the Entravision License Subsidiary, as applicable,
for the renewal of each Media License and Entravision Media License over which
the FCC has jurisdiction, when and as such application shall become due to be
filed with the FCC.
(c) Except as described on Schedule 3.21 hereto, after due inquiry, the
Borrower does not know of any application currently pending before, or to be
filed with, the FCC, the grant of which application would result in the
authorization of a new or modified station whose authorized transmissions would
materially and impermissibly interfere with any of the operations, signals,
transmission or receptions of the Borrower or its Subsidiaries (as such
impermissible interference is described in the FCC's rules, regulations and
policies, including, without limitation, the FCC's rules relating to Receiver
Induced Third Order Intermodulation Effect, Blanketing, Antenna Separation,
Desired-to-Undesired Signal Ratios, and Prohibited Contour Overlap).
3.22 Investment Company Act; Other Regulations. The Borrower is not, and
-----------------------------------------
no Subsidiary is, an "investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended (the "Investment Company Act").
----------------------
3.23 Copyright Act Requirements. The Borrower and each Subsidiary has
--------------------------
recorded or deposited with and paid to the United States Copyright Office, the
Registrar of Copyrights, the Patent and Trademark Office, the American Society
of Composers, Authors and Publishers, Broadcast Music, Inc. and/or any other
licensors of copyrighted materials, all notices, statements of account, royalty
fees and other documents and instruments required under the terms and conditions
of any patent, trademark, service xxxx, trade name and copyright used in the
operation of a Station and/or the Copyright Act of 1976, as amended from time to
time, and the rules and regulations promulgated thereunder and, except as
disclosed in writing to the Agent, is not liable in a material amount to any
Person for copyright infringement under any law, rule, regulation, contract or
license as a result of its business operation.
3.24 Nature of Business. The Borrower is not, and no Subsidiary is,
------------------
engaged in any material business other than the ownership and operation of
Spanish-language radio stations, a Spanish-language radio network, Spanish-
language newspapers and other Spanish-language print publications.
-29-
3.25 Ranking of Loans. This Agreement and the other Loan Documents to
----------------
which the Borrower is party, when executed, and the Loans, when borrowed are and
will be the direct and general obligations of the Borrower. The Borrower's
obligations hereunder and thereunder rank and will rank at least pari passu in
---- -----
priority of payment to all other Indebtedness of the Borrower and its
Subsidiaries.
3.26 Condemnation. To the Borrower's knowledge, no taking of any of the
------------
Properties or any part thereof through eminent domain, conveyance in lieu
thereof, condemnation or similar proceeding is pending or, to the knowledge of
the Borrower, threatened by any Governmental Authority.
SECTION 4. CONDITIONS PRECEDENT
4.1 Conditions to Closing Date. The agreement of each Lender to make the
--------------------------
Loans requested to be made by it on the Closing Date is subject to the
satisfaction, immediately prior to or concurrently with the making of such Loans
on the Closing Date, of the following conditions precedent:
(a) Merger. (i) The Merger shall have been consummated in accordance with
------
the terms of the Merger Agreement, without any waiver or amendment not consented
to by the Agent, and the Agent shall have received a certificate of a
Responsible Officer of the Borrower to the effect that all material transactions
contemplated by the Merger Agreement to be consummated on or prior to the
Closing Date have been consummated without any such waiver or amendment;
(ii) The Agent shall have received a copy of the certificate of
merger filed with the Delaware Secretary of State evidencing the consummation of
the Merger;
(iii) The Agent shall have received evidence, in form and substance
satisfactory to the Agent, that Entravision has made an equity investment in the
Borrower, on terms and conditions satisfactory to the Agent, in the amount of at
least $145,000,000;
(iv) The Agent shall have received a copy of the Merger Agreement
(including the Disclosure Schedules thereto), along with all bills of sale and
similar agreements and documents relating thereto, certified by the Borrower to
be true, correct and complete copies thereof, with no amendments thereto;
(v) The Agent shall have received all necessary corporate
resolutions of the shareholders and board of directors of LCG approving the
Merger;
(vi) The Agent shall have received the legal opinions of counsel
delivered under the Merger Agreement, each in form and substance satisfactory to
the Agent, and each such opinion shall contain a statement or be accompanied by
a letter addressed to the Agent and the Lenders dated the Closing Date, to the
effect that the Agent and the Lenders may rely upon such opinion to the same
extent as if it were originally addressed to each of them;
(vii) The Agent shall have received evidence, in form and substance
satisfactory to the Agent, that the aggregate consideration paid for all
outstanding shares of LCG
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in connection with the Merger shall not exceed $252,000,000, and the Agent shall
have received a certificate of a Responsible Officer of the Borrower to such
effect; and
(viii) The Agent shall have received evidence, in form and substance
satisfactory to the Agent, that the Merger is in compliance with the Xxxx-Xxxxx-
Xxxxxx Act, and that any necessary approval thereunder has been obtained and is
in full force and effect.
(b) Credit Agreement. The Agent shall have received this Agreement,
----------------
executed and delivered by an officer of the Borrower as of the Closing Date.
(c) Other Loan Documents. The Agent shall have received the Notes, the
--------------------
Guarantees, the Guarantor Security Agreements, the Security Agreement, the
Intercreditor Agreement and all UCC-1 Financing Statements and other agreements
or instruments required to create or perfect a security interest in the
Collateral executed in connection herewith, in each case executed and delivered
by an officer of the relevant Obligor.
(d) Incumbency Certificates. The Agent shall have received an incumbency
-----------------------
certificate of LCGAC, LCG (setting forth the officers thereof immediately after
the consummation of the Merger) and each other Guarantor, in each case dated the
Closing Date and executed by one of its Responsible Officers or its Secretary or
Assistant Secretary.
(e) Corporate/Limited Liability Company Proceedings. The Agent shall have
-----------------------------------------------
received a copy of the resolutions of the Board of Directors of LCGAC, LCG
(immediately after the consummation of the Merger) and each other corporate
Guarantor, and a copy of the resolutions of the appropriate governing body of
each limited liability company Guarantor, each dated as of the Closing Date
authorizing (i) the execution, delivery and performance of the Loan Documents to
which it is or will be a party, (ii) the borrowings contemplated hereunder (in
the case of LCGAC and LCG), (iii) the consummation of the Merger (in the case of
LCGAC and LCG) and (iv) the execution and delivery on behalf of the Borrower of
all notices, certificates and other documents to be delivered under the Loan
Documents from time to time, in each case certified by the Secretary or an
Assistant Secretary of such Obligor or the Managing Member(s) of such Obligor,
as applicable, as of the Closing Date, which certificate states that such
resolutions thereby certified have not been amended, modified, revoked or
rescinded and are in full force and effect.
(f) Organic Documents. The Agent shall have received copies of the
-----------------
Organic Documents of LCGAC, LCG (immediately after consummation of the Merger)
and each other Guarantor, certified as of the Closing Date as complete and
correct copies thereof (or, with respect to copies of Organic Documents which
have not been amended since their delivery under the Entravision Credit
Agreement, a certificate stating that such copies remain complete and correct
and such documents have not been amended) by the Secretary or an Assistant
Secretary of such Obligor.
(g) Fees and Costs. The Agent shall have received payment of all fees,
--------------
costs and expenses, including legal fees (if requested by the Agent) and the
fees set forth in the closing side letter executed by the Borrower and the Agent
in connection herewith, accrued and unpaid
-31-
and otherwise due and payable on or before the Closing Date by the Borrower in
connection with this Agreement.
(h) Legal Opinions. The Agent shall have received, with a counterpart for
--------------
each Lender, the following executed legal opinions:
(i) the executed legal opinion of Xxxxxx Xxxxxx Xxxxxxx XxXxxxxx
Xxxxxx & Fognani, L.L.P., counsel to the Borrower and the Guarantors, in
form and substance satisfactory to the Agent;
(ii) the executed legal opinion of Xxxxxxxx, Xxxx & Xxxxx, LLP, FCC
counsel to the Borrower and the Guarantors, in form and substance
satisfactory to the Agent;
(iii) the executed legal opinions of (A) Fried, Frank, Harris, Xxxxxxx
& Xxxxxxxx and Xxxxxxxxx, Xxxxxx & Xxxxxx, P.L.L.C., counsel to the sellers
under the Merger Agreement, and (B) Xxxxxx Xxxxxx Xxxxxxx XxXxxxxx Xxxxxx &
Fognani, L.L.P., counsel to the purchasers under the Merger Agreement, in
each case in the form delivered pursuant to the Merger Agreement and either
addressed to the Agent and the Lenders or with a letter authorizing the
Agent and the Lenders to rely on such legal opinions; and
(iv) such other legal opinions as the Agent may reasonably request.
(i) Material Contracts. The Agent shall have received, with a counterpart
------------------
for each Lender, copies of (i) each Material Contract and (ii) to the extent not
referred to in clause (i), the Merger Agreement.
(j) Recording/Filing. The Agent shall have received as of the Closing
----------------
Date evidence of (i) the filing, or of provision acceptable to the Agent for the
filing, of appropriate financing statements naming the Agent, for the benefit of
the Lenders, as secured party (including recordation of all fixture filings
requested by the Agent), in such office or offices as may be necessary or, in
the reasonable opinion of the Agent, desirable to perfect the security interests
purported to be created by any of the Collateral Documents or the Guarantor
Collateral Documents, (ii) the payment by the Borrower of all filing taxes or
assessments imposed by any such state or county office and (iii) all filings and
other actions necessary or desirable to perfect a security interest in any
intellectual property of any Obligor pledged under the Loan Documents.
(k) Lien Searches. The Agent shall have received such UCC searches as it
-------------
shall deem necessary.
(l) Stock Certificates; Etc. The Agent shall have received (i) original
------------------------
stock certificates representing all outstanding shares of stock of the Borrower
and each corporate Subsidiary, together with an undated stock power for each of
such certificates, duly executed in blank by an authorized officer of the
pledgor and (ii) such Limited Liability Company Notices and Limited Liability
Company Acknowledgments as are required by the Security Agreement or any
Guarantor Security Agreement.
-32-
(m) Good Standing Certificates. With respect to the LCGAC, LCG and each
--------------------------
Guarantor, the Agent shall have received a certificate, dated a recent date, of
the Secretary of State of the state of formation of such Obligor and each other
jurisdiction where such Obligor is required to be qualified to do business under
such jurisdiction's law, certifying as to the existence and good standing of,
and the payment of taxes by, each Obligor in such state.
(n) No Default/Representations. No Default shall have occurred and be
--------------------------
continuing on the Closing Date or would occur after giving effect to the Loans
requested to be made on the Closing Date, and the representations and warranties
contained in this Agreement and each other Loan Document and certificate or
other writing delivered to the Lenders in satisfaction of the conditions set
forth in this Section 4.1 prior to or on the Closing Date shall be correct in
all material respects on and as of the Closing Date, and the Agent shall have
received a certificate of the Borrower to such effect in the form of Exhibit C,
dated as of the Closing Date and executed by a Responsible Officer of the
Borrower.
(o) No Prohibitions. No statute, rule, regulation, order, decree or
---------------
preliminary or permanent injunction of any court or administrative agency or, to
the best knowledge of the Borrower, any such action threatened by any Person,
shall be in effect that prohibits the Lenders from consummating the transactions
contemplated by this Agreement or any other Loan Document, and the Agent shall
have received a certificate of a Responsible Officer of the Borrower to such
effect.
(p) Solvency Certificate. The Agent shall have received a certificate of
--------------------
the Chief Financial Officer of the Borrower and each Guarantor, to the effect
that the Borrower and each Guarantor is Solvent after giving effect to the
consummation of the Merger, the funding of the Loans, the execution and delivery
of the Guarantees, and the payment of all estimated legal, investment banking,
accounting, and other fees related hereto and thereto.
(q) Insurance Policies. The Agent shall have received evidence that the
------------------
insurance policies provided for in Section 5.5 and in the other Loan Documents
are in full force and effect, certified by the insurance broker therefor,
together with appropriate evidence showing the Agent as an additional named
insured or loss payee, as appropriate, for the benefit of the Lenders, all in
form and substance reasonably satisfactory to the Agent.
(r) Operational Consents; FCC Matters. The Agent shall have received
---------------------------------
evidence, in form and substance reasonably satisfactory to the Agent that (i)
all necessary FCC consents to the transaction contemplated by the Merger
Agreement have been obtained, provided that such consents need not have become
Final Orders, (ii) the Borrower and its Subsidiaries have obtained all FCC
consents and licenses required by law or necessary for the operation of the
Borrower and its Subsidiaries, (iii) the Borrower and its Subsidiaries have
obtained all other consents and licenses required by law or necessary for the
operation of the Borrower and its Subsidiaries and (iv) pro forma applications
for FCC approval of the transfer of the Media Licenses to the LCG License
Subsidiary have been filed with the FCC.
(s) Existing Indebtedness. The Agent shall have received evidence
---------------------
satisfactory to it of (i) the full repayment of all existing Indebtedness of the
Borrower and its Subsidiaries, except as described in Schedule 6.2, and (ii) the
termination of all guarantees and collateral pledges (or
-33-
evidence that arrangements for termination of such collateral pledges
satisfactory to the Agent shall have been made).
(t) Operating Cash Flow. The Agent shall have received a certificate of a
-------------------
Responsible Officer of the Borrower stating that the consolidated Operating Cash
Flow of the Borrower and its Subsidiaries for the twelve months ended on January
31, 2000 was not less than $7,200,000, including calculations with respect
thereto in the form set forth in paragraph 2 of the Covenant Compliance
Certificate.
(u) Financial Information. The Agent shall have received (i) the
---------------------
financial statements referred to in Section 3.12, (ii) a pro forma balance sheet
--- -----
of the Borrower and its Subsidiaries giving effect to the Merger, in form and
substance satisfactory to the Agent, (iii) projections of the performance of the
Borrower, in form and substance satisfactory to the Agent, and (iv) an operating
budget for the Borrower and its Subsidiaries for the period from the Closing
Date through December 31, 2000, in form and substance satisfactory to the Agent.
(v) Third Amendment to Entravision Credit Agreement. The Agent shall have
-----------------------------------------------
received evidence of the satisfaction of the conditions precedent to the third
amendment, dated as of the date hereof, to the Entravision Credit Agreement.
(w) Additional Proceedings. The Agent shall have received such other
----------------------
approvals, opinions and documents as any Lender, through the Agent, may
reasonably request and all legal matters incident to the making of such Loans
shall be reasonably satisfactory to the Agent.
SECTION 5. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that from and after the Closing Date, so long as
any Commitment remains in effect, any Note remains outstanding and unpaid or any
other amount is owing to any Lender or the Agent hereunder:
5.1 Financial Statements
--------------------
(a) Within 120 days after the close of each fiscal year, the Borrower
shall deliver to the Agent, for distribution to the Lenders, a complete set of
audited annual consolidated and consolidating financial statements of the
Borrower, including a balance sheet, an income statement, a cash flow statement
and a reconciliation of consolidated net worth (with accompanying notes and
schedules). Such financial statements (i) must be prepared in accordance with
GAAP consistently applied and (ii) must be certified without qualification by
the Accountants. Together with the audited financial statements, the Agent must
also receive a certificate signed by such Accountants, at the time of the
completion of the annual audit, (A) stating that the financial statements fairly
present the consolidated and consolidating financial condition of the Borrower
as of the date thereof and for the periods covered thereby and (B) that, to the
knowledge of such Accountants, no Default exists under Section 6.1, to the
extent such Section relates to accounting matters.
(b) Within 45 days after the end of each fiscal quarter, the Borrower
shall deliver to the Agent, for distribution to the Lenders, (x) unaudited
consolidated and consolidating financial statements of the Borrower for such
quarter and (y) unaudited consolidated and consolidating
-34-
financial statements for the Borrower for the year-to-date period ended as of
the end of such quarter, in each case in form and substance acceptable to the
Agent. Such financial statements shall include, without limitation, a balance
sheet, income statement and operating cash flow statement (with appropriate
notes and schedules) and shall include a comparison of the results of each such
period with the results for the same period of the previous fiscal year and with
the budgeted results set forth in the budget referred to in Section 5.2(c) (or,
prior to delivery of such budget, the budget delivered on the Closing Date) and
must be prepared in accordance with GAAP consistently applied. In the case of
the financial statements referred to in clause (y), such financial statements
shall be prepared in accordance with GAAP consistently applied (except as
required by Section 1.2(e)). Together with the quarterly financial statements,
the Agent must also receive (i) a certificate executed by the Chief Financial
Officer of the Borrower (A) stating that the financial statements fairly present
the financial condition of the Borrower as of the date thereof and for the
periods covered thereby, (B) certifying that as of the date of such certificate
such officer has obtained no knowledge of any Default except as specified in
such certificate and (C) certifying that to the best of such officer's
knowledge, no Default has occurred and the Borrower is in compliance with its
respective covenants in the Loan Documents to which it is party and (ii) a
Covenant Compliance Certificate.
(c) Within 30 days after the end of each month, the Borrower shall deliver
to the Agent, for distribution to the Lenders, an unaudited monthly consolidated
and consolidating income statement and balance sheet, along with a comparison of
the results of such month with the same month of the previous fiscal year and
with the budgeted results set forth in the budget referred to in Section 5.2(c)
(or, prior to delivery of such budget, the budget delivered on the Closing
Date), in each case in form and substance acceptable to the Agent, certified by
a Responsible Officer of the Borrower as fairly presenting the financial
condition of the Borrower as of the date thereof and for the period covered
thereby.
(d) Within 45 days of the end of each fiscal quarter, the Borrower shall
deliver to the Agent, for distribution to the Lenders, a financial report, in
form and substance acceptable to the Agent, relating to the operations of each
Station and each publication as at the end of such quarter and the portion of
the fiscal year through the end of such quarter, certified by a Responsible
Officer of the Borrower as fairly presenting the financial condition of each
Station and publication as of the end of such quarter.
5.2 Certificates; Other Information. The Borrower shall furnish to the
-------------------------------
Agent, for distribution to the Lenders:
(a) within five Business Days after the same are filed, copies of all
financial statements and reports that the Borrower or any Subsidiary may make
to, or file with, the Securities and Exchange Commission or any successor or
analogous Governmental Authority;
(b) promptly but, in any event, within five Business Days after receipt
thereof, copies of all financial reports (including, without limitation,
management letters), if any, submitted to the Borrower or any Subsidiary by the
Accountants in connection with any annual or interim audit of the books thereof;
-35-
(c) by January 31 of each year, commencing with the fiscal year ending on
December 31, 2000, a copy of the annual operating budget for the Borrower and
its Subsidiaries for such fiscal year, in form satisfactory to the Agent;
(d) as soon as possible and in any event within five Business Days after
the occurrence of a Default or, in the good faith determination of a Responsible
Officer of the Borrower, a Material Adverse Effect, the written statement by a
Responsible Officer of the Borrower, setting forth the details of such Default
or Material Adverse Effect and the action that the Borrower proposes to take
with respect thereto;
(e) promptly, but in any event within 30 days after any change in the
senior management personnel of the Borrower, written notice of such change;
(f) promptly but, in any event, within five Business Days after the same
become available, copies of all statements, reports and other information that
the Borrower sends to any holder of an equity interest therein;
(g) (A) as soon as possible and in any event within 30 days after the
Borrower knows or has reason to know that any Termination Event with respect to
any Plan has occurred, a statement of a Responsible Officer of the Borrower
describing such Termination Event and the action, if any, which the Borrower
proposes to take with respect thereto, (B) promptly and in any event within ten
days after receipt thereof by the Borrower or any ERISA Affiliate of the
Borrower from the PBGC, copies of each notice received by the Borrower or such
ERISA Affiliate of the PBGC's intention to terminate any Plan or to have a
trustee appointed to administer any Plan, (C) promptly and in any event within
30 days after the filing thereof with the Internal Revenue Service, copies of
each Schedule B (Actuarial Information) to the annual report (Form 5500 Series)
with respect to each Single Employer Plan maintained for or covering employees
of the Borrower or any Subsidiary if the present value of the accrued benefits
under the Plan exceeds its assets by an amount in excess of $500,000 and (D)
promptly and in any event within ten days after receipt thereof by the Borrower
or any ERISA Affiliate of the Borrower from a sponsor of a Multiemployer Plan or
from the PBGC, a copy of each notice received by the Borrower or such ERISA
Affiliates concerning the imposition or amount of withdrawal liability under
Section 4202 of ERISA or indicating that such Multiemployer Plan may enter
reorganization status under Section 4241 of ERISA;
(h) promptly after the commencement thereof, but in any event not later
than five Business Days after service of process with respect thereto on, or the
obtaining of knowledge by, the Borrower or any Subsidiary, notice of each
material action, suit or proceeding before any Governmental Authority;
(i) promptly after the sending or filing thereof, but in any event not
later than ten Business Days following such sending or filing, copies of (A) all
Ownership Reports on FCC Form 323 (or any similar form which may be adopted by
the FCC from time to time) relating to any Media License or Entravision Media
License, and any supplements thereto, and (B) all statements, reports and other
information filed with the FCC by or on behalf of the Borrower, any Subsidiary
or the Entravision License Subsidiary with respect to any Media License or
Entravision Media License;
-36-
(j) promptly, but in any event within one Business Day after any period
during which the transmission at any Station or transmission site is interrupted
or curtailed for an aggregate of 12 hours or more (whether or not consecutive),
written notice thereof;
(k) promptly upon receipt thereof, but in any event not later than five
Business Days following such receipt, copies of all notices and other
communications that the Borrower, any Subsidiary or the Entravision License
Subsidiary shall have received from the FCC with respect to any FCC hearing,
order or dispute (A) directly concerning the Borrower, any Subsidiary, the
Entravision License Subsidiary, any Station, any Media License or any
Entravision Media License or (B) that may have a Material Adverse Effect;
(l) promptly upon receipt thereof, but in any event not later than ten
Business Days following such receipt, copies of all Arbitron rating period
reports; and
(m) promptly, such additional financial and other information as any
Lender, through the Agent, may from time to time reasonably request.
5.3 Payment of Obligations. The Borrower shall, and shall cause each of
----------------------
its Subsidiaries to, pay, discharge or otherwise satisfy at or before maturity
or before they become delinquent, as the case may be, all its obligations of
whatever nature, except where the failure to so satisfy such obligations would
not have a Material Adverse Effect or except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP with respect thereto have been provided on
the books of the Borrower or its Subsidiaries, as the case may be.
5.4 Conduct of Business and Maintenance of Existence. The Borrower shall,
------------------------------------------------
and shall cause each of its Subsidiaries to, continue to engage in business of
the same general type as conducted by the Borrower and its Subsidiaries as of
the Closing Date and preserve, renew and keep in full force and effect its
corporate or limited liability company existence, as applicable, and take all
reasonable action to maintain all rights, registrations, licenses, privileges
and franchises necessary or desirable in the normal conduct of its business, and
comply with all Contractual Obligations and Requirements of Law except to the
extent that failure to comply therewith would not, in the aggregate, have a
Material Adverse Effect.
5.5 Maintenance of Property; Insurance. The Borrower shall, and shall
----------------------------------
cause each of its Subsidiaries to, keep all property useful or necessary in its
business in good working order and condition (ordinary wear and tear excepted);
maintain with financially sound and reputable insurance companies or
associations insurance on such of its property in at least such amounts and
against such risks as are usually insured against in the same general area by
companies engaged in the same or a similar business (including casualty,
liability, fire, flood, business interruption, earthquake and workers'
compensation); and furnish to the Agent, upon written request, full information
as to the insurance carried. All such policies of insurance on the property of
the Borrower and the Subsidiaries shall contain an endorsement, in form and
substance reasonably satisfactory to the Agent in its sole discretion, showing
the Agent, on behalf of the Lenders, as additional insured or loss payee, as
appropriate, or as its interests appear. Such endorsement, or an independent
instrument furnished to the Agent, shall provide that the insurance companies
will give the Agent at least 25 days' prior written notice before any
-37-
such policy or policies of insurance shall be altered or canceled. All policies
of insurance required to be maintained under this Agreement shall be in
customary form and with insurers reasonably acceptable to the Agent, and all
such policies shall be in such amounts as shall be customary for similar
companies in the same or similar business in the same geographical area. The
Borrower shall deliver to the Agent insurance certificates certified by the
Borrower's insurance brokers, as to the existence and effectiveness of each
policy of insurance and evidence of payment of all premiums then due and payable
therefor. In addition, the Borrower shall notify the Agent promptly of any
occurrence causing a material loss of any insured Property and the estimated (or
actual, if available) amount of such loss. Further, the Borrower and its
Subsidiaries shall maintain all insurance required under the other Loan
Documents.
(i) Each policy for liability insurance shall provide for all losses
to be paid on behalf of the Agent and the Borrower or Subsidiary (as the case
may be), as their respective interests may appear, and each policy for property
damage insurance shall, to the extent applicable to equipment and inventory,
provide for all losses (except for losses of less than $500,000 per occurrence,
which may be paid directly to the Borrower or such Subsidiary, as applicable) to
be paid directly to the Agent.
(ii) Reimbursement under any liability insurance maintained by the
Borrower or its Subsidiaries pursuant to this Section 5.5 may be paid directly
to the Person who shall have incurred liability covered by such insurance. In
the case of any loss involving damage to equipment or inventory as to which
clause (iii) of this Section 5.5 is not applicable, the Borrower will make or
cause to be made the necessary repairs to or replacements of such equipment or
inventory, and any proceeds of insurance maintained by the Borrower or its
Subsidiaries pursuant to this Section 5.5 shall be paid by the Agent to the
Borrower or such Subsidiaries, upon presentation of invoices and other evidence
of obligations, as reimbursement for the costs of such repairs or replacements.
(iii) Upon the occurrence and during the continuance of a Default, all
insurance proceeds in respect of such equipment or inventory shall be paid to
the Agent and applied in repayment of the Loans.
5.6 Inspection of Property; Books and Records; Discussions. The Borrower
------------------------------------------------------
shall, and shall cause each of its Subsidiaries to, keep proper books of record
and account in which full, true and correct entries in conformity with GAAP and
all Requirements of Law shall be made of all material dealings and transactions
in relation to its business and activities; and upon reasonable notice and at
such reasonable times during usual business hours, permit representatives of any
Lender to visit and inspect any of its properties and examine and make abstracts
from any of its books and records at any reasonable time and as often as may
reasonably be desired and to discuss the business, operations, properties and
financial and other condition of the Borrower and its Subsidiaries with officers
and employees of the Borrower and its Subsidiaries and with its Accountants.
5.7 Environmental Laws. The Borrower shall, and shall cause each of its
------------------
Subsidiaries to:
(a) Comply in all material respects with, and ensure compliance by all
tenants and subtenants, if any, with, all applicable Environmental Control
Statutes and obtain and comply in
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all material respects with any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental Control Statutes;
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Control Statutes and promptly comply in all material respects with
all lawful orders and directives of all Governmental Authorities regarding
Environmental Control Statutes except to the extent that the same are being
contested in good faith by appropriate proceedings; and
(c) Defend, indemnify and hold harmless the Agent and the Lenders, and
their respective employees, agents, officers and directors, from and against any
and all claims, demands, penalties, fines, liabilities, settlements, damages,
costs and expenses of whatever kind or nature known or unknown, contingent or
otherwise, arising out of, or in any way relating to the violation of,
noncompliance with or liability under any Environmental Control Statutes
applicable to the operations of the Borrower or any of its Subsidiaries, or the
Borrower's or any of its Subsidiaries' interest in Properties, or any orders,
requirements or demands of Governmental Authorities related thereto, including,
without limitation, attorneys' and consultants' fees, investigation and
laboratory fees, response costs, court costs and litigation expenses, except to
the extent that any of the foregoing arise out of the gross negligence or
willful misconduct of the party seeking indemnification therefor. This indemnity
shall continue in full force and effect regardless of the termination of this
Agreement.
5.8 Use of Proceeds. The Borrower will use (i) $105,000,000 of the
---------------
proceeds of the Loans to pay a portion of the aggregate consideration to be paid
by LCGAC in the Merger for outstanding shares of LCG and (ii) $10,000,000 of the
proceeds of the Loans to fund the Interest Reserve Account.
5.9 Compliance With Laws, Etc. The Borrower shall comply, and shall cause
-------------------------
each of its Subsidiaries to comply, in all material respects with all applicable
Requirements of Law, such compliance to include, without limitation (i) paying
before the same become delinquent all taxes, assessments and governmental
charges or levies imposed upon it or upon its income or profits or upon any of
its Properties and (ii) paying all lawful claims which if unpaid might become a
Lien upon any of its Properties; provided, however, that neither the Borrower
-------- -------
nor any of such Subsidiaries shall be required to pay and discharge or to cause
to be paid and discharged any such tax, assessment, charge, levy or claim so
long as (A) the validity or applicability thereof is being contested in good
faith by appropriate proceedings or the failure to pay such tax, assessment,
charge, levy or claim would not (in the reasonable judgment of the Majority
Lenders) have a Material Adverse Effect and (B) the Borrower or such Subsidiary
shall, to the extent required by GAAP, have set aside on its books adequate
reserves with respect thereto.
5.10 Media Licenses. The Borrower will obtain, maintain and preserve, and
--------------
cause each of its Subsidiaries to obtain, maintain and preserve, all Media
Licenses (and will cause the Media Licenses to be held by the Entravision
License Subsidiary or the LCG License Subsidiary in accordance with the terms of
this Agreement), including without limitation, by filing with the FCC (i) those
of the Loan Documents required to be filed under the FCC's rules and regulations
within 30 days after the Closing Date and (ii) all reports (including Ownership
Reports on FCC Form 323) and other documents required to be filed by the
Communications Act in connection
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with the transactions contemplated hereby and maintaining public records and
files in accordance with Communications Act and the rules and regulations of the
FCC.
5.11 Guarantees, Etc. The Borrower will cause each of its Subsidiaries
---------------
hereafter formed or acquired to execute and deliver to the Agent promptly upon
the formation or acquisition thereof (i) a Guarantee in form and substance
satisfactory to the Agent, guaranteeing the Obligations, (ii) a Guarantor
Security Agreement, in form and substance satisfactory to the Agent, granting to
the Agent, for the benefit of the Lenders, a security interest in the tangible
and intangible personal property of such Subsidiary, together with appropriate
Lien searches requested by the Agent indicating the Lenders' first priority Lien
on such personal property and (iii) UCC-1 Financing Statements, duly executed by
such Subsidiary, in form and substance satisfactory to the Agent and, in
connection with such deliveries, cause to be delivered to the Agent (A) the
stock certificates representing the issued and outstanding shares of stock of
such Subsidiary, together with undated stock powers executed in blank, (B) a
favorable written opinion of counsel satisfactory to the Agent as to such
matters relating thereto as any Lender through the Agent may reasonably request,
in form and substance satisfactory to the Agent and (C) such other agreements,
instruments, approvals or other documents as any Lender through the Agent may
reasonably request.
5.12 License Subsidiary. The Borrower will cause each Media License to be
------------------
transferred to the LCG License Subsidiary by May 31, 2000 and to be held by the
LCG License Subsidiary at all times thereafter until the Obligations have been
paid in full and all Commitments have expired. The Borrower will not permit the
LCG License Subsidiary to (i) own any right, franchise or other asset except for
Media Licenses (and FCC files and records with respect thereto) or (ii) engage
in any business other than holding such Media License, files and records.
5.13 Interest Rate Protection. Within 30 days after the Closing Date, the
------------------------
Borrower will enter into and maintain one or more Interest Rate Agreements, each
in form and substance reasonably satisfactory to the Agent, covering a minimum
of 75% of the Loans outstanding on the Closing Date.
5.14 Leases and Licenses. The Borrower shall or shall cause its
-------------------
Subsidiaries to perform and carry out, in all material respects, all of the
provisions of all of the leases, licenses, permits and any other occupancy
agreements relating to real property or real property interests (the "Occupancy
---------
Agreements") to be performed by the Borrower or any of its Subsidiaries and
----------
shall appear in and defend any action in which the validity of any of the
Occupancy Agreements relating to any real property or real property interests is
at issue and shall commence and maintain any action or proceeding necessary to
establish or maintain the validity of any of such Occupancy Agreements and to
enforce the provisions thereof.
5.15 Lease and License Approvals. The Borrower and its Subsidiaries shall
---------------------------
submit to the Agent for its prior approval any leases, licenses, permits or
other Occupancy Agreements relating to real property or real property interests
that the Borrower or any of its Subsidiaries may desire to execute or obtain,
which provide for the payment of rent or license fees in excess of $100,000 in
any fiscal year. Each such agreement shall be subject to the approval of the
Agent, such approval not to be unreasonably withheld. The Agent may require that
any lease, license or
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other similar agreement become part of the Collateral or the Guarantor
Collateral, and the Borrower and its Subsidiaries shall provide or cause to be
provided any and all Collateral Documents or Guarantor Collateral Documents or
other documents to be executed in connection therewith requested by the Agent
and provide the Agent with title insurance (to the extent applicable) as a
condition to approval.
5.16 Notices. The Borrower will provide, and will cause its Subsidiaries
-------
to provide to the Agent, within 5 Business Days following receipt by the
Borrower or any Subsidiary, copies of all notices received by the Borrower or
such Subsidiary (i) under any Material Contract or any instrument, document or
agreement relating to any Subordinated Indebtedness, relating to any material
default, any claimed force majeure or any other material provision thereof and
(ii) from the Internal Revenue Service or other taxing authority relating to any
material dispute regarding deductions, audits or any other material matter
which, if adversely determined against the Borrower or such Subsidiary, would
have a Material Adverse Effect.
5.17 Additional Material Contracts and Media Licenses. The Borrower (a)
------------------------------------------------
will notify the Agent in writing within 90 calendar days after executing,
entering into, becoming bound by or subject to or otherwise obtaining any
contract, agreement or Media License that should have been listed on Schedule
3.8 hereto or Schedule 3.9 hereto if it had existed as of the Closing Date and
(b) will concurrently update Schedule 3.8 hereto or Schedule 3.9 hereto (as
appropriate).
SECTION 6. NEGATIVE COVENANTS
The Borrower hereby agrees that from and after the Closing Date, so long as
any Commitments remain in effect, any Note remains outstanding and unpaid or any
other amount is owing to any Lender or the Agent hereunder:
6.1 Financial Condition Covenants. The Borrower shall not:
-----------------------------
(a) Total Interest Coverage Ratio. Permit the Total Interest Coverage
-----------------------------
Ratio for the Borrower and its Subsidiaries on a consolidated basis, for the
period representing the number of whole months (not exceeding twelve months)
that have passed from and including May 1, 2000 to and including the last day of
the fiscal quarter of the Borrower ending on the applicable date specified
below, as determined by reference to the applicable Covenant Compliance
Certificate to be provided pursuant to Section 5.1(b), to be less than the
following levels for the periods indicated:
Period Ending Ratio
------------- -----
September 30, 2000 1.35:1
December 31, 2000 1.50:1
and thereafter
; provided, however, that the Borrower need not comply with the foregoing
-------- -------
covenant for any period specified above during which all interest in respect of
the Loans was paid from the Interest Reserve Account.
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(b) Minimum Operating Cash Flow. Permit the Operating Cash Flow of the
---------------------------
Borrower and its Subsidiaries on a consolidated basis, for the twelve months
ended as of the end of any fiscal quarter of the Borrower as determined by
reference to the applicable Covenant Compliance Certificate to be provided
pursuant to Section 5.1(b), to be less than the following levels for the periods
indicated:
Period Ending Maximum Amount
------------- --------------
June 30, 2000 $8,000,000
September 30, 2000 $8,500,000
December 31, 2000 $9,200,000
and thereafter
6.2 Limitation on Indebtedness. The Borrower shall not create, incur,
--------------------------
assume or suffer to exist any Indebtedness, and shall not permit any of its
Subsidiaries to create, incur, assume or suffer to exist any Indebtedness,
except for:
(a) Indebtedness created hereunder and under the Notes;
(b) Indebtedness of the Borrower or any Subsidiary outstanding on the
Closing Date and listed on Schedule 6.2;
(c) Indebtedness (i) under any Interest Rate Agreement required pursuant
to Section 5.13, (ii) evidenced by performance bonds or letters of credit issued
in the ordinary course of business or reimbursement obligations in respect
thereof, (iii) evidenced by a letter of credit facility related to insurance
associated with claims for work-related injuries or (iv) for bank overdrafts
incurred in the ordinary course of business that are promptly repaid; and
(d) trade credit incurred to acquire goods, supplies, services and
incurred in the ordinary and normal course of business.
Notwithstanding the foregoing, the LCG License Subsidiary shall not be
permitted, under any circumstances, to create, incur, assume or suffer to exist
any Indebtedness, other than the Indebtedness created under the Loan Documents.
6.3 Limitation on Liens. The Borrower shall not, and shall not permit
-------------------
any of its Subsidiaries to, create, incur, assume or suffer to exist any Lien
upon any of its property, assets or revenues, whether now owned or hereafter
acquired, except for:
(a) Liens created hereunder or under any of the other Loan Documents;
(b) Liens existing on any Property at the time of its acquisition and not
created in anticipation of such acquisition;
(c) Liens arising pursuant to any order of attachment, distraint or
similar legal process arising in connection with court proceedings so long as
the execution or other
-42-
enforcement thereof is effectively stayed and claims secured thereby are being
contested in good faith by appropriate proceedings;
(d) Liens for taxes not yet due or which are being contested in good faith
by appropriate proceedings, provided that adequate reserves with respect thereto
--------
are maintained on the books of the Borrower or its Subsidiaries, as the case may
be, in conformity with GAAP;
(e) Liens created by operation of law not securing the payment of
Indebtedness for money borrowed or guaranteed, including carriers',
warehousemen's, mechanics', materialmen's, repairmen's or other like Liens
arising in the ordinary course of business, which are not overdue for a period
of more than 45 days or which are being contested in good faith by appropriate
proceedings;
(f) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation and deposits
securing liability to insurance carriers under insurance or self-insurance
arrangements;
(g) deposits to secure the performance of bids, trade contracts (other
than for borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the
ordinary course of business; and
(h) easements, rights-of-way, restrictions and other similar encumbrances
incurred in the ordinary course of business, which, in the aggregate, would not
cause a Material Adverse Effect.
Notwithstanding the foregoing, the LCG License Subsidiary shall not be
permitted, under any circumstances, to incur any consensual Liens or Liens
securing the payment of Indebtedness for money borrowed or guaranteed, other
than Liens created by the Loan Documents.
6.4 Limitation on Fundamental Changes. The Borrower shall not, and shall
---------------------------------
not permit any of its Subsidiaries to, enter into any merger, consolidation or
amalgamation (other than the Merger), or liquidate, wind up or dissolve itself
(or suffer any liquidation or dissolution), or create or acquire any Subsidiary
or Affiliate (unless the documents required by Section 5.11 are executed and
delivered) or convey, sell, lease, assign, transfer or otherwise dispose of
(including by making any Station subject to any local marketing or similar
agreement) all or substantially all of its property, business or assets.
6.5 Limitation on Sale of Assets. The Borrower shall not, and shall not
----------------------------
permit any of its Subsidiaries to, make any Asset Disposition without the prior
written consent of the Majority Lenders in each case, such consent not to be
unreasonably withheld.
6.6 Limitation on Dividends. The Borrower shall not, and shall not permit
-----------------------
any of its Subsidiaries to (a) if a corporation, declare or pay any dividend
(other than dividends payable solely in common stock of the Borrower or its
Subsidiaries) on, or make any payment on account of, or set apart assets for a
sinking or other analogous fund for, the purchase, redemption, defeasance,
retirement or other acquisition of, any shares of any class of Capital Stock of
the Borrower or its Subsidiaries or any warrants or options to purchase any such
Capital Stock, whether now or hereafter outstanding, and (b) if a partnership or
a limited liability company,
-43-
make any distribution with respect to the ownership interests therein, or, in
either case, any other distribution in respect thereof, either directly or
indirectly, whether in cash or property or in obligations of the Borrower or any
Subsidiary.
6.7 Limitation on Investments, Loans and Advances. The Borrower shall
---------------------------------------------
not, and shall not permit any of its Subsidiaries to, make any advance, loan,
extension of credit or capital contribution to, or purchase any stock, bonds,
notes, debentures or other securities of or any assets constituting a business
unit of, or make any other investment in (any of the foregoing, an
"investment"), any Person, except for:
----------
(a) consummation of the Merger in accordance with the terms of Section
4.1;
(b) the Borrower's ownership interest in its Subsidiaries;
(c) investments in marketable securities, liquid investments and other
financial instruments that are acquired for investment purposes and may be
readily sold or otherwise liquidated, that have a value which may be readily
established and which are investment grade;
(d) extensions of trade credit in the ordinary course of business; and
(e) investments existing on the Closing Date and listed on Schedule 6.7.
Notwithstanding the foregoing, the LCG License Subsidiary shall not be
permitted, under any circumstances, to make any investments.
6.8 Limitation on Modifications of Certain Documents and Instruments.
----------------------------------------------------------------
The Borrower shall not, and shall not permit its Subsidiaries to, terminate,
amend or modify any provision of any document, instrument or agreement relating
to any Material Contract or any Organic Document, in each case which could have
a Material Adverse Effect.
6.9 Transactions with Affiliates. The Borrower shall not, and shall not
----------------------------
permit any of its Subsidiaries to, enter into any transaction, including,
without limitation, any purchase, sale, lease or exchange of property or the
rendering of any service, with any Affiliate or any Subsidiary less than wholly-
owned, directly or indirectly, by the Borrower, unless such transaction (i) is
otherwise permitted under this Agreement or (ii) is in the ordinary course of
the Borrower's or such Subsidiary's business and is upon terms no less favorable
to the Borrower or such Subsidiary, as the case may be, than it would obtain in
a comparable arm's length transaction with a Person not an Affiliate.
6.10 Fiscal Year. The Borrower shall not permit its fiscal year or the
-----------
fiscal year of any of its Subsidiaries to end on a day other than December 31.
6.11 Lease Obligations. The Borrower shall not, and shall not permit any
-----------------
of its Subsidiaries to, sell, assign or otherwise transfer any of its
Properties, rights or assets (whether now owned or hereafter acquired) to any
Person and thereafter directly or indirectly lease back the same or similar
property.
-44-
6.12 Unfunded Liabilities. The Borrower shall not permit unfunded
--------------------
liabilities for any and all Plans maintained for or covering employees of the
Borrower or any Subsidiary to exceed $500,000 in the aggregate at any time.
6.13 Management Fees. The Borrower shall not, and shall not permit any of
---------------
its Subsidiaries to, incur any management fees for services rendered.
6.14 Equity Offerings. The Borrower shall not, and shall not permit any of
----------------
its Subsidiaries to, consummate or agree to consummate any Equity Offering.
SECTION 7. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrower shall fail to pay any principal on any Note when due, the
Borrower shall fail to pay any interest on any Note, any fee referred to in the
letter referred to in Section 4.1(g) within two Business Days after any such
interest or fee becomes due in accordance with the terms thereof and hereof, or
the Borrower shall fail to pay any other amount payable hereunder within five
Business Days after written notice that such other amount is due; or
(b) Any representation or warranty made or deemed made by any Obligor
herein or in any other Loan Document or that is contained in any certificate,
document or financial or other statement furnished at any time under or in
connection with this Agreement or any other Loan Document shall prove to have
been incorrect in any material respect when made or deemed made; or
(c) The Borrower shall default in the observance or performance of any
agreement contained in Section 5.2(d), 5.3, 5.4, 5.8, 5.9, 5.10, 5.11, 5.12,
5.13, or any provision of Section 6; or
(d) (i) Any Obligor shall default in the observance or performance of any
other material agreement contained in this Agreement or the other Loan Documents
(other than as provided in paragraphs (a) through (c) of this Section), and such
default shall continue unremedied for a period of 30 days after the earlier of
(y) notice thereof from the Agent to the Borrower and (z) actual knowledge
thereof by a senior officer of such Obligor (unless such default is of such a
nature that it cannot reasonably be cured within 30 days after the date
described in clause (y) or (z), as applicable, in which case the defaulting
Obligor has not commenced the cure thereof within such 30-day period and/or has
not thereafter diligently pursued the completion of the same), (ii) any material
provision of any Loan Document shall at any time for any reason be declared null
and void, or the validity or enforceability of any Loan Document shall at any
time be contested by any Obligor, or a proceeding shall be commenced by any
Obligor, or by any Governmental Authority or other Person having jurisdiction
over any Obligor, seeking to establish the invalidity or unenforceability
thereof, or any Obligor shall deny that it has any liability or obligation
purported to be created under any Loan Document or (iii) a "Default" shall have
occurred and be continuing under the Entravision Credit Agreement; or
(e) Any Guarantee shall cease, for any reason, to be in full force and
effect, and such occurrence shall have a Material Adverse Effect; or
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(f) Except as set forth in Section 7(d)(iii), the Borrower or any other
Obligor shall (i) default in any payment of principal or interest, regardless of
the amount, due in respect of any (A) Indebtedness (other than the Notes),
issued under the same indenture or other agreement, if the original principal
amount of Indebtedness covered by such indenture or agreement is $500,000 or
greater or (B) any Guarantee Obligation with respect to an amount of $500,000 or
greater, beyond the period of grace, if any, provided in the instrument or
agreement under which such Indebtedness or Guarantee Obligation was created,
whether or not such default has been waived by the holders of such Indebtedness
or Guarantee Obligation; or (ii) default in the observance or performance of any
other material agreement or condition relating to any such Indebtedness or
Guarantee Obligation or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause, or to
permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Guarantee Obligation (or a trustee or agent on behalf of
such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to become due prior to its
stated maturity or such Guarantee Obligation to become payable or such
Indebtedness to be required to be defeased or purchased; or
(g) (i) The Borrower or any other Obligor shall commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian or other similar official
for it or for all or any substantial part of its assets, or the Borrower or any
other Obligor shall make a general assignment for the benefit of its creditors;
or (ii) there shall be commenced against the Borrower or any other Obligor any
case, proceeding or other action of a nature referred to in clause (i) above
which (A) results in the entry of an order for relief or any such adjudication
or appointment or (B) remains undismissed, undischarged, unstayed or unbonded
for a period of 60 days; or (iii) there shall be commenced against the Borrower
or any other Obligor any case, proceeding or other action seeking issuance of a
warrant of attachment, execution, distraint or similar process against all or
any substantial part of its assets which results in the entry of an order for
any such relief which shall not have been vacated, discharged, stayed or bonded
pending appeal within 60 days from the entry thereof; or (iv) the Borrower or
any other Obligor shall take any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any of the acts set forth in clause
(i), (ii), or (iii) above; or (v) the Borrower or any other Obligor shall
generally not, or shall be unable to, or shall admit in writing its inability
to, pay its debts as they become due or there shall be a general assignment for
the benefit of creditors; or
(h) (i) Any Person shall engage in any non-exempt "prohibited transaction"
(as defined in Section 406 of ERISA or Section 4975 of the Code) involving any
Plan, (ii) any "accumulated funding deficiency" (as defined in Section 302 of
ERISA), whether or not waived, shall exist with respect to any Plan, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence to
have a trustee appointed, or a trustee shall be appointed, to administer or to
terminate any Single Employer Plan, which Reportable Event or commencement of
proceedings or appointment of a trustee would reasonably be expected to result
in the
-46-
termination of such Plan for purposes of Title IV of ERISA, (iv) any Single
Employer Plan shall terminate for purposes of Title IV of ERISA (other than a
standard termination) or (v) the Borrower or any Commonly Controlled Entity
would reasonably be expected to incur any liability in connection with a
withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan;
and in each case regarding clauses (i) through (v) above, such event or
condition, together with all other such events or conditions, if any, would
reasonably be expected to subject the Borrower or any other Obligor to any tax,
penalty or other liabilities in the aggregate to exceed $500,000; or
(i) One or more judgments or decrees shall be entered against the Borrower
or any other Obligor involving in the aggregate a liability (not paid or fully
covered by insurance) of $250,000 or more, and all such judgments or decrees
shall not have been vacated, discharged, stayed or bonded pending appeal within
60 days from the entry thereof or in any event five days before the date of any
sale pursuant to such judgment or decree or any non-monetary judgment or order
shall be entered against the Borrower or any other Obligor that is reasonably
likely to have a Material Adverse Effect and either (i) enforcement proceedings
shall have been commenced by any Person upon such judgment, which has not been
stayed pending appeal or (ii) there shall be any period of 10 consecutive days
during which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect; or
(j) There shall occur any default in the material observance or material
performance of any Material Contract or any such Material Contract shall
terminate or otherwise no longer be in full force and effect, in each case to
the extent such default or termination could reasonably be expected to have a
Material Adverse Effect; or
(k) (A) any designation by any Governmental Authority (including the FCC)
of an evidentiary hearing with regard to any application of the Borrower, any of
its Subsidiaries, or any other Obligor requesting any authorization from such
Governmental Authority shall fail to be dismissed within 120 days after such
designation and the Agent, in its reasonable judgment after consultation with
its FCC counsel, believes that it is more likely than not that the result
thereof will be the termination, revocation, suspension, non-renewal or material
(and adverse) modification of any material Media License held by the Borrower or
its Subsidiaries, or any material Entravision Media License held by Entravision
or any of its Subsidiaries (other than the Borrower or its Subsidiaries), or (B)
any Governmental Authority (including the FCC) shall terminate, revoke or
substantially and adversely modify any material Media License of the Borrower or
its Subsidiaries, or any material Entravision Media License held by Entravision
or any of its Subsidiaries (other than the Borrower or its Subsidiaries), or (C)
any action or proceeding commenced by any Governmental Authority (including the
FCC) seeking the termination, suspension, revocation, non-renewal or substantial
and adverse modification of any material Media License or any material
Entravision Media License shall fail to be dismissed within 120 days after such
commencement, and the Agent, in its reasonable judgment after consultation with
its FCC counsel, believes that such proceeding will more likely than not result
in such termination, suspension, revocation, non-renewal or substantial and
adverse modification, or (D) any material Media License or any material
Entravision Media License shall expire by its terms and is not renewed in a
timely manner, or any material agreement which is necessary to the operation of
any broadcast facility or transmission site relating to any material Media
License or any material Entravision Media License shall expire or is revoked or
-47-
terminated and is not replaced by a comparable substitute or a substitute
reasonably acceptable to the Agent. (For purposes of this Section 7(k), a
"material" Media License is (1) any Media License (other than a Media License
issued by the FCC), alone or in conjunction with other Media Licenses then
subject to any of the circumstances described in this Section, the loss of which
(in the Agent's reasonable judgment) could have a Material Adverse Effect, (2)
any Entravision Media License (other than an Entravision Media License issued by
the FCC), alone or in conjunction with other Entravision Media Licenses then
subject to any of the circumstances described in this Section, the loss of which
(in the Agent's reasonable judgment) could have a Material Adverse Effect and
(3) any Media License or Entravision Media License issued by the FCC.
Notwithstanding the foregoing, with respect to the type of event described in
clause (A) or clause (C) above, the occurrence of such event will not constitute
an Event of Default under and for purposes of clause (A) or clause (C) of this
Section 7(k) only, provided that (and so long as) each of the following
-------- ----
conditions is satisfied to the Agent's satisfaction:
(i) the Borrower provides the Agent with written notice of such
event within five Business Days after it or any other Obligor is notified by the
FCC of such designation (and also provides a copy of any such notice received
from the FCC), and
(ii) the notice of designation affirmatively indicates that it
relates only to the licenses or applications of a single Station or a single
Entravision Station rather than to the licenses and/or applications of more than
one Station or Entravision Station, and
(iii) with respect to any Media License, if an adverse ruling in the
proceeding would threaten the Borrower's ability to continue providing the same
level of underlying service by such Station as theretofore provided, then (A)
the Borrower shall make a prepayment of the Loans (within 30 Business Days after
receiving notice of such designation from the FCC) in an amount sufficient for
the Borrower to remain in compliance with each of the financial covenants under
Section 6.1 hereof without including any of the Operating Cash Flow attributable
to such Station and (B) the Borrower shall thereafter exclude the Operating Cash
Flow attributable to such Station from the calculation of the Borrower's
consolidated Operating Cash Flow. Any such prepayment and exclusion from
Operating Cash Flow will be permanent unless and until the FCC proceeding
regarding such license or application is finally resolved to the Agent's
satisfaction in a manner favorable to the Borrower and without any divestiture
of assets required by the FCC or otherwise voluntarily accomplished by the
Borrower pursuant to the next sentence. Once the Borrower has made such
prepayment and exclusion from Operating Cash Flow under the circumstances
contemplated by this clause (iii), then the Borrower may thereafter sell the
assets relating to such Station (and only such Station) pursuant to a
transaction with an unrelated third party (i.e., a non-Affiliate) for value
----
received provided that (1) the Borrower gives the Agent written notice of such
-------- ----
transaction at least 30 days (but not more than 60 days) prior to consummation
of such transaction, (2) the representation under Section 3.20 regarding
solvency of the Borrower is true immediately prior to and following any such
disposition, (3) such transaction does not cause a Material Adverse Effect or
otherwise violate any covenant hereunder or otherwise cause a Default hereunder,
(4) the Borrower provides the Agent with a certificate renewing the
representations and warranties in the Loan Documents and (if and to the extent
appropriate) updating the various schedules to the Loan Documents to make the
representations and warranties therein true, accurate and complete following
such transaction and (5) the proceeds of such transaction are promptly used to
prepay the Loans; or
-48-
(l) Any material provision of any Loan Document, after delivery thereof
pursuant to the provisions hereof, shall, for any reason other than an act or
omission by the Agent, cease to be valid or enforceable in accordance with its
terms and such cessation shall have a Material Adverse Effect, or any security
interest created under any Loan Document shall for any reason other than an act
or omission by the Agent, cease to be a valid and perfected first-priority
security interest or Lien (except as otherwise stated or permitted herein or
therein) in any material portion of the Collateral, the Guarantor Collateral or
the property purported to be covered thereby; or
(m) A Change in Control shall have occurred; provided that, the occurrence
of any event which would constitute a Change in Control shall not constitute an
Event of Default under this Section 7(m) if such event is by reason of the death
or disability of either or both of Xxxxxx X. Xxxxx and Xxxxxx X. Xxxxxxxxx and
(i) no other Default has occurred and is continuing and (ii) there has been
presented to the Lenders within 120 days of such death or disability a plan for
reorganization of, and operation of the business of, the Borrower and
Entravision (which plan shall include compliance with the terms of this
Agreement and the other Loan Documents) in the absence of such individual or
individuals (as applicable) which is satisfactory to the Majority Lenders in
their reasonable discretion; or
(n) The operations of any Station or any Entravision Station shall be
interrupted or curtailed at any time for a period in excess of 96 hours (whether
or not consecutive) during any period of seven consecutive days; or
(o) With respect to any Obligor that is organized as a limited liability
company, any member thereof (A) experiences an event described in Section 7(g)
hereof, (B) dies, dissolves or otherwise terminates its existence, or (C)
withdraws from membership in such limited liability company. Notwithstanding the
foregoing, such event will not constitute an Event of Default hereunder if (1)
within 15 Business Days of the occurrence such event, the Agent is notified
thereof in writing and (2) within 30 days of the occurrence of such event (or
within such shorter period as may be required by applicable law or the
applicable Organic Documents for such limited liability company), the remaining
members of such limited liability company take all action necessary, if any (in
a manner reasonably acceptable to the Agent) to continue the existence of such
limited liability company as an operating organization liable to the Agent for
its obligations under the Loan Documents;
then, and in any such event, (A) if such event is an Event of Default specified
in paragraph (g) above, automatically the Commitments to the Borrower shall
immediately terminate and the Loans made to the Borrower hereunder (with accrued
interest thereon) and all other Obligations shall immediately become due and
payable, and (B) if such event is any other Event of Default, with the consent
of the Majority Lenders, the Agent may, or upon the request of the Majority
Lenders, the Agent shall, take any or all of the following actions: (i) by
notice to the Borrower declare the Commitments to the Borrower to be terminated
forthwith, whereupon such Commitments shall immediately terminate; and (ii) by
notice of default to the Borrower, declare the Loans (with accrued interest
thereon) and all other Obligations under this Agreement and the Notes to be due
and payable forthwith, whereupon the same shall immediately become due and
payable. In all cases, with the consent of the Majority Lenders, the Agent may
enforce any or all of the Liens and security interests and other rights and
remedies created pursuant to any Loan
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Document or available at law or in equity. Except as expressly provided above in
this Section, presentment, demand, protest and all other notices of any kind are
hereby expressly waived by the Borrower.
SECTION 8. THE AGENT
8.1 Appointment. Each Lender hereby irrevocably designates and appoints
-----------
Union Bank of California, N.A. as Agent of such Lender under this Agreement and
the other Loan Documents, and each such Lender irrevocably authorizes Union Bank
of California, N.A., as the Agent for such Lender, to take such action on its
behalf under the provisions of this Agreement and the other Loan Documents and
to exercise such powers and perform such duties as are expressly delegated to
the Agent by the terms of this Agreement and the other Loan Documents, together
with such other powers as are reasonably incidental thereto. Notwithstanding any
provision to the contrary elsewhere in this Agreement, the Agent shall not have
any duties or responsibilities, except those expressly set forth herein, or any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Agent.
8.2 Delegation of Duties. The Agent may execute any of its duties under
--------------------
this Agreement and the other Loan Documents by or through agents or attorneys-
in-fact and shall be entitled to advice of counsel concerning all matters
pertaining to such duties. The Agent shall not be responsible for the negligence
or misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.
8.3 Exculpatory Provisions. Neither the Agent nor any of its officers,
----------------------
directors, employees, agents, attorneys-in-fact or Affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Agreement or any other Loan Document (except
for its or such Person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower, any Subsidiary or any other
Obligor or any officer thereof contained in this Agreement or any other Loan
Document or in any certificate, report, statement or other document referred to
or provided for in, or received by the Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or the Notes or any
other Loan Document or for any failure of the Borrower, any Subsidiary or any
other Obligor to perform its obligations hereunder or thereunder. The Agent
shall not be under any obligation to any Lender to ascertain or to inquire as to
the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of the Borrower, any Subsidiary or any other
Obligor.
8.4 Reliance by the Agent. The Agent shall be entitled to rely, and shall
---------------------
be fully protected in relying, upon any note, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or
teletype message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Borrower), the Accountants and independent
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accountants and other experts selected by the Agent. The Agent may deem and
treat the payee of any Note as the owner thereof for all purposes unless a
written notice of assignment, negotiation or transfer thereof shall have been
filed with the Agent. The Agent shall be fully justified in failing or refusing
to take any action under this Agreement or any other Loan Document unless it
shall first receive such advice or concurrence of the Majority Lenders or all
Lenders, as it deems appropriate, or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense (except to
the extent incurred as a result of the Agent's gross negligence or willful
misconduct) which may be incurred by it by reason of taking or continuing to
take any such action. The Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement and the Notes and the
other Loan Documents in accordance with a request of the Majority Lenders or all
Lenders, as may be required, and such request and any action taken or failure to
act pursuant thereto shall be binding upon all the Lenders and all future
holders of the Notes.
8.5 Notice of Default. The Agent shall not be deemed to have knowledge or
-----------------
notice of the occurrence of any Default hereunder unless the Agent has received
notice from a Lender or the Borrower referring to this Agreement, describing
such Default and stating that such notice is a "notice of default". In the event
that the Agent receives such a notice, the Agent shall give notice thereof to
the Lenders. The Agent shall take such action with respect to such Default as
shall be reasonably directed by the Majority Lenders or all Lenders as
appropriate; provided that unless and until the Agent shall have received such
--------
directions, the Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default as it shall deem
advisable in the best interests of the Lenders or as the Agent shall believe
necessary to protect the Lenders' interests in the Collateral or the Guarantor
Collateral.
8.6 Non-Reliance on the Agent and Other Lenders. Each Lender expressly
-------------------------------------------
acknowledges that neither the Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates has made any representations
or warranties to it and that no act by the Agent hereafter taken, including any
review of the affairs of the Borrower, any Subsidiary or any other Obligor,
shall be deemed to constitute any representation or warranty by the Agent to any
Lender. Each Lender represents to the Agent that it has, independently and
without reliance upon the Agent or any other Lender, and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower, any Subsidiary and the other
Obligors and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon the Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Borrower, its Subsidiaries and the other Obligors. Except for notices, reports
and other documents expressly required to be furnished to the Lenders by the
Agent hereunder, the Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, property, condition (financial or otherwise), prospects or
creditworthiness of the Borrower, any Subsidiary or any other Obligor that may
come into the possession of the Agent or any of its respective officers,
directors, employees, agents, attorneys-in-fact or Affiliates.
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8.7 Indemnification. The Lenders agree to indemnify the Agent in its
---------------
capacity as such (to the extent not reimbursed by the Borrower, its Subsidiaries
or the other Obligors and without limiting the obligation of such Persons to do
so), ratably according to the respective amounts of their Commitment
Percentages, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs (including, without
limitation, the allocated cost of internal counsel), expenses or disbursements
of any kind whatsoever which may at any time (including, without limitation, at
any time following the payment of the Notes) be imposed on, incurred by or
asserted against the Agent, in its capacity as Agent, but not as a Lender
hereunder, in any way relating to or arising out of this Agreement, any of the
other Loan Documents or any documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby or any action taken
or omitted by the Agent under or in connection with any of the foregoing;
provided that no Lender shall be liable for the payment of any portion of such
--------
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements to the extent resulting from the Agent's gross
negligence or willful misconduct. The agreements in this Section shall survive
the payment of the Notes and all other amounts payable hereunder.
8.8 The Agent in Its Individual Capacity. The Agent and its Affiliates
------------------------------------
may make loans to, accept deposits from and generally engage in any kind of
business with the Borrower, any Subsidiary and the other Obligors as though the
Agent were not the Agent hereunder and under the other Loan Documents. With
respect to the Agent, the Loans made by the Agent, and any Note issued to the
Agent shall have the same rights and powers under this Agreement and the other
Loan Documents as any Lender and may exercise the same as though it were not the
Agent, and the terms "Lender" and "Lenders" shall include the Agent in its
individual capacity.
8.9 Successor Agent. The Agent may resign as Agent upon 30 days' notice
---------------
to the Lenders. If the Agent shall resign as Agent under this Agreement and the
other Loan Documents, then the Majority Lenders shall appoint from among the
Lenders a successor agent for the Lenders, which successor agent shall be
approved by the Borrower (which consent shall not be unreasonably withheld),
whereupon such successor agent shall succeed to the rights, powers and duties of
the Agent and the term "Agent" shall mean such successor agent, effective upon
its appointment, and the former Agent's rights, powers and duties as Agent shall
be terminated, without any other or further act or deed on the part of such
former Agent or any of the parties to this Agreement or any holders of the
Notes. After any retiring Agent's resignation as Agent, the provisions of this
Section shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent under this Agreement and the other Loan
Documents. Further, if the Agent no longer has any Loans or Commitment
hereunder, the Agent shall immediately resign and shall be replaced, and have
the benefits, as set forth in this Section 8.9.
SECTION 9. MISCELLANEOUS
9.1 Amendments and Waivers. Neither this Agreement, any Note, any other
----------------------
Loan Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section. With the
prior written consent of the Majority Lenders and the Borrower (and, in the case
of any Loan Document other than this Agreement, the relevant Obligor), the
Borrower may, from time to time, enter into written amendments,
-52-
supplements or modifications hereto and to the Notes and the other Loan
Documents for the purposes of adding any provisions to this Agreement or the
Notes or the other Loan Documents or changing in any manner the rights of the
Lenders, the Borrower or any other Obligor hereunder or thereunder or waiving,
on such terms and conditions as may be specified in such instrument, any of the
requirements of this Agreement or the Notes or the other Loan Documents or any
Default and its consequences; provided, however, that no such waiver and no such
-------- -------
amendment, supplement or modification shall (i) (a) reduce the amount or extend
the maturity of any Note or any installment due thereon, or reduce the rate or
extend the time of payment of interest thereon, or reduce the amount or extend
the time of payment of any fee, indemnity or reimbursement payable to any Lender
hereunder, or change the amount of any Lender's Commitment, in each case without
the written consent of the Lender affected thereby; or (b) amend, modify or
waive any provision of this Section 9.1 or reduce the percentage specified in or
otherwise modify the definition of Majority Lenders, or consent to the
assignment or transfer by any Obligor of any of its rights and obligations under
this Agreement and the other Loan Documents; or (c) release any Obligor from any
liability under its respective Loan Documents; or (d) release any material
portion of the Collateral or any material portion of the Guarantor Collateral,
except for any Asset Disposition or release of Lien permitted by this Agreement
or any other Loan Document; or (e) amend, modify or waive, directly or
indirectly, any of the provisions of Section 2.1(f) or 2.9; or (f) amend, modify
or waive any provision of this Agreement requiring the consent or approval of
all Lenders; or (g) increase the amount of the Aggregate Commitment, in each
case set forth in clauses (i)(b) through (i)(g) above without the written
consent of all the Lenders; or (ii) amend, modify or waive any provision of
Section 8 without the written consent of the then Agent. Any such waiver and any
such amendment, supplement or modification shall apply equally to each of the
Lenders and shall be binding upon the Borrower, the other Obligors, the Lenders,
the Agent and all future holders of the Notes. In the case of any waiver, the
Borrower, the other Obligors, the Lenders and the Agent shall be restored to
their former position and rights hereunder and under the outstanding Notes and
any other Loan Documents, and any Default waived shall be deemed to be cured and
not continuing; but no such waiver shall extend to any subsequent or other
Default, or impair any right consequent thereon.
9.2 Notices. All notices, requests and demands or other communications to
-------
or upon the respective parties hereto to be effective shall be in writing
(including by telecopy), and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made when delivered by hand, or 3 days
after being deposited in the United States mail, certified and postage prepaid
and return receipt requested, or, in the case of telecopy notice, when received,
in each case addressed as follows in the case of the Borrower and the Agent, and
as set forth on the signature pages hereto, or in the Assignment and Acceptance
pursuant to which a Person becomes a party hereto, in the case of the Lenders,
or to such other address as may be hereafter notified by the respective parties
hereto and any future holders of the Notes:
The Borrower:
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LCG Acquisition Corporation
0000 Xxxxxxx Xxxxxxxxx, Xxxxx 0000 Xxxx
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxxxxxx
Xxxxxxxx Xxxxx
Telecopy: (000) 000-0000
With a copy to (which shall not constitute notice
to the Borrower):
Xxxxxxxx Xxxx & Xxxxx, LLP
0000 X Xxxxxx, X.X.
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxxxx, Esq.
Telecopy: (000) 000-0000
and
Xxxxxx Xxxxxx Xxxxxxx
XxXxxxxx Xxxxxx & Fognani, L.L.P.
000 Xxxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
The Agent: Union Bank of California, N.A
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxx
Telecopy: (000) 000-0000
provided that any notice, request or demand to or upon the Agent or the Lenders
--------
pursuant to Section 2.1, 2.2 or 2.4 shall not be effective until received.
9.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay
------------------------------
in exercising, on the part of the Agent or any Lender, any right, remedy, power
or privilege hereunder shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege. The rights, remedies, powers and privileges herein
provided are cumulative and not exclusive of any rights, remedies, powers and
privileges provided by law.
9.4 Survival of Representations and Warranties. All representations and
------------------------------------------
warranties made hereunder and in any document, certificate or statement
delivered pursuant hereto or in connection herewith shall survive the execution
and delivery of this Agreement and the Notes.
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9.5 Payment of Expenses and Taxes. The Borrower agrees (a) to pay to
-----------------------------
reimburse the Agent for all its reasonable costs and out-of-pocket expenses
(including travel and other expenses incurred by it or its agents in connection
with performing due diligence with regard hereto) incurred in connection with
the development, preparation and execution of, and any amendment, supplement or
modification to, this Agreement and the Notes and the other Loan Documents and
any other documents prepared in connection herewith or therewith, and the
consummation and administration of the transactions contemplated hereby and
thereby (including those contemplated to occur on the Closing Date), including,
without limitation, syndication efforts in connection with this Agreement and
the reasonable fees and disbursements of counsel to the Agent (including special
counsel with regard to FCC matters, special counsel with regard to Collateral or
Guarantor Collateral located outside of California and the allocated costs of
internal counsel to the Agent), which counsel fees shall be subject to the
approval of the Borrower, such approval not to be unreasonably withheld or
delayed, (b) after the occurrence and during the continuance of a Default, to
pay or reimburse the Agent and each Lender for all its reasonable costs and out-
of-pocket expenses incurred in connection with the enforcement or preservation
of any rights under this Agreement, the Notes, the other Loan Documents and any
such other documents or in connection with any refinancing or restructuring of
the credit arrangements provided under this Agreement in the nature of a "work-
out" or of any insolvency or bankruptcy proceeding, including, without
limitation, reasonable legal fees and disbursements of counsel to the Agent and
each Lender (including the allocated costs of internal counsel to the Agent),
(c) to pay, and indemnify and hold harmless each Lender and the Agent from any
and all recording and filing fees and any and all liabilities with respect to,
or resulting from any delay in paying, stamp, excise and other taxes, if any,
which may be payable or determined to be payable in connection with the
execution and delivery of, or consummation or administration of any of the
transactions contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, this Agreement, the Notes, the
other Loan Documents and any such other documents and (d) to pay, and indemnify
and hold harmless each Lender and the Agent from and against, any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs (including the allocated cost of internal counsel and the reasonable legal
fees and disbursements of outside counsel to the Lenders and the Agent),
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement, the Notes and the other Loan Documents, the Merger or the use of the
proceeds of the Loans and any such other documents (all the foregoing,
collectively, the "indemnified liabilities" irrespective of whether the
transactions contemplated by this Agreement and the other Loan Documents are
consummated), provided, that the Borrower shall have no obligation hereunder to
--------
the Agent or any Lender with respect to indemnified liabilities arising from the
gross negligence or willful misconduct of the Agent or such Lender or their
agents or attorneys-in-fact. The agreements in this Section shall survive
repayment of the Notes and all other amounts payable hereunder. The Agent and
the Lenders agree to provide reasonable details and supporting information
concerning any costs and expenses required to be paid by the Borrower pursuant
to the terms hereof.
9.6 Successors and Assigns; Participations; Purchasing Lenders.
-----------------------------------------------------------
(a) This Agreement shall be binding upon and inure to the benefit of the
Borrower, the Lenders, the Agent, all future holders of the Notes and their
respective successors and
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assigns, except that the Borrower may not assign, transfer or delegate any of
its rights or obligations under this Agreement without the prior written consent
of each Lender.
(b) Any Lender may, in the ordinary course of its commercial banking or
finance business and in accordance with applicable law, at any time sell to one
or more banks or other entities ("Participants") participating interests in any
------------
Loan owing to such Lender, any Note held by such Lender, any Commitment of such
Lender or any other interest of such Lender hereunder and under the other Loan
Documents; provided that the holder of any such participation, other than an
--------
Affiliate of such Lender, shall not be entitled to require such Lender to take
or omit to take any action hereunder except action directly affecting the
extension of the maturity of any portion of the principal amount of a Loan or
any portion of interest or fees related thereto allocated to such participation
or a reduction of the principal amount or principal payment amount of or the
rate of interest payable on the Loans or any fees related thereto, or a release
of any Obligor or any substantial portion of the Collateral or the Guarantor
Collateral or any increase in participation amounts. In the event of any such
sale by a Lender of participating interests to a Participant, such Lender's
obligations under this Agreement to the other parties to this Agreement shall
remain unchanged, such Lender shall remain solely responsible for the
performance thereof, such Lender shall remain the holder of any such Note for
all purposes under this Agreement and the other Loan Documents, and the Borrower
and the Agent shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents. The Borrower agrees that if amounts outstanding under
this Agreement and the Notes are due or unpaid, or shall have been declared or
shall have become due and payable upon the occurrence of an Event of Default,
each Participant shall be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement and any Note to the
same extent as if the amount continuing of its participating interest were owing
directly to it as a Lender under this Agreement or any Note, provided that such
--------
Participant shall only be entitled to such right of setoff if it shall have
agreed in the agreement pursuant to which it shall have acquired its
participating interest to share with the Lenders the proceeds thereof as
provided in Section 9.7. The Borrower also agrees that each Participant shall be
entitled to the benefits of Sections 2.11, 2.12 and 2.13 with respect to its
participation in the Commitments and the Loans outstanding from time to time;
provided, that no Participant shall be entitled to receive any greater amount
--------
pursuant to such Sections than the transferor Lender would have been entitled to
receive in respect of the amount of the participation transferred by such
transferor Lender to such Participant had no such transfer occurred.
(c) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time sell to any of its
Affiliates or to any Lender, any Affiliate thereof or to one or more additional
lenders or financial institutions ("Purchasing Lenders"), which additional
------------------
lenders shall be subject to the consent of the Borrower (such consent not to be
unreasonably withheld and not to be required if a Default has occurred and is
continuing) all or any part of its rights and obligations under this Agreement,
the Notes and the other Loan Documents pursuant to an Assignment and Acceptance
substantially in the form of Exhibit B, executed by such Purchasing Lender and
such transferor Lender and delivered to the Agent for its acceptance and
recording in the Register (as defined in (d) below), provided, that any such
--------
sale must result in the Purchasing Lender having at least $5,000,000 in
aggregate amount of obligations under this Agreement, the Notes and the other
Loan Documents. Upon
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such execution, delivery, acceptance and recording, from and after the transfer
effective date determined pursuant to such Assignment and Acceptance, (x) the
Purchasing Lender thereunder shall be a party hereto and, to the extent provided
in such Assignment and Acceptance, have the rights and obligations of a Lender
hereunder with a Commitment as set forth therein, and (y) the transferor Lender
thereunder shall, to the extent of such assigned portion and as provided in such
Assignment and Acceptance, be released from its obligations under this Agreement
and the other Loan Documents (and, in the case of an Assignment and Acceptance
covering all or the remaining portion of a transferor Lender's rights and
obligations under this Agreement, such transferor Lender shall cease to be a
party hereto). Such Assignment and Acceptance shall be deemed to amend this
Agreement to the extent, and only to the extent, necessary to reflect the
addition of such Purchasing Lender and the resulting adjustment of Commitment
Percentages arising from the purchase by such Purchasing Lender of all or a
portion of the rights and obligations of such transferor Lender under this
Agreement, the Notes and the other Loan Documents. On or prior to the transfer
effective date determined pursuant to such Assignment and Acceptance, the
Borrower, at its own expense, shall execute and deliver to the Agent in exchange
for the surrendered Note or Notes a new Note or Notes to the order of such
Purchasing Lender in an amount equal to the Commitment assumed by it pursuant to
such Assignment and Acceptance, and if the transferor Lender has retained a
Commitment hereunder, new Notes to the order of the transferor Lender in an
amount equal to the Commitments retained by it hereunder. Such new Notes shall
be dated the Closing Date and shall otherwise be in the form of the Notes
replaced thereby. The Notes surrendered by the transferor Lender shall be
returned by the Agent to the Borrower marked "canceled."
(d) The Agent shall maintain at its address referred to in Section 9.2 a
copy of each Assignment and Acceptance delivered to it and a register (the
"Register") for the recordation of the names and addresses of the Lenders and
--------
the Commitment of, and principal amount of the Loans owing to each Lender from
time to time. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as the owner of the Loans recorded
therein for all purposes of this Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any reasonable time and from time to
time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by a
transferor Lender and Purchasing Lender (and, in the case of a Purchasing Lender
that is not then a Lender or an Affiliate thereof, by the Borrower and the
Agent) together with payment to the Agent (except in the case of a Lender
assigning to its Affiliate) of a registration and processing fee of $3,500, the
Agent shall (i) promptly accept such Assignment and Acceptance and (ii) on the
effective date determined pursuant thereto record the information contained
therein in the Register and give notice of such acceptance and recordation to
the Lenders and the Borrower.
(f) The Borrower authorizes each Lender to disclose to any Participant or
Purchasing Lender (each, a "Transferee") and any prospective Transferee any
----------
and all financial information in such Lender's possession concerning the
Borrower and its Subsidiaries and Affiliates, which has been delivered to such
Lender by or on behalf of the Borrower pursuant to this Agreement or any other
Loan Document or which has been delivered to such Lender by or on behalf of the
Borrower in connection with such Lender's credit evaluation of the Borrower and
its Subsidiaries and Affiliates prior to becoming a party to this Agreement.
-57-
(g) If, pursuant to this Section, any interest in this Agreement or any
Note is transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any state thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, (i) to represent to the transferor Lender and the Agent (for the
benefit of the transferor Lender, the Agent and the Borrower) that under
applicable law and treaties no taxes will be required to be withheld by the
Agent, the Borrower or the transferor Lender with respect to any payments to be
made to such Transferee in respect of the Loans, (ii) to furnish to the
transferor Lender, the Agent and the Borrower either U.S. Internal Revenue
Service Form X-0, X-0XXX xx X-0XXX (as applicable to it) (wherein such
Transferee claims entitlement to complete exemption from U.S. federal
withholding tax on all interest payments hereunder) and (iii) to agree (for the
benefit of the transferor Lender, the Agent and the Borrower) to provide the
transferor Lender, the Agent and the Borrower a new Form X-0, X-0XXX or W-8ECI
(as applicable to it) upon the expiration or obsolescence of any previously
delivered form and comparable statements in accordance with applicable U.S. laws
and regulations and amendments duly executed and completed by such Transferee,
and to comply from time to time with all applicable U.S. laws and regulations
with regard to such withholding tax exemption.
(h) Nothing herein shall prohibit any Lender from pledging or assigning
any of its rights under its Notes to any Federal Reserve Bank in accordance with
applicable law.
9.7 Adjustments; Set-Off.
---------------------
(a) If any Lender (a "benefited Lender") shall at any time receive any
----------------
payment of all or part of its Loans or interest thereon, or fees, or receive any
collateral in respect thereof (whether voluntarily or involuntarily, by set-off,
pursuant to events or proceedings of the nature referred to in Section 7(g), or
otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of such other Lender's Loans or
interest thereon, or fees, such benefited Lender shall purchase for cash from
the other Lenders such portion of each such other Lender's Loans or fees, or
shall provide such other Lenders with the benefits of any such collateral, or
the proceeds thereof, as shall be necessary to cause such benefited Lender to
share the excess payment or benefits of such collateral or proceeds ratably with
each of the Lenders; provided, however, that if all or any portion of such
-------- -------
excess payment or benefits is thereafter recovered from such benefited Lender,
such purchase shall be rescinded, and the purchase price and benefits returned,
to the extent of such recovery, but without interest. The Borrower agrees that
each Lender so purchasing a portion of another Lender's Loan may exercise all
rights of payment (including, without limitation, rights of set-off) with
respect to such portion as fully as if such Lender were the direct holder of
such portion.
(b) In addition to any rights and remedies of the Lenders provided by law,
with the prior consent of the Majority Lenders, each Lender shall have the
right, exercisable upon the occurrence and during the continuance of an Event of
Default and acceleration of the Obligations pursuant to Section 7, without prior
notice to the Borrower, any such notice being expressly waived by the Borrower
to the extent permitted by applicable law, to set-off and appropriate and apply
against any such Obligations any and all deposits (general or special, time or
demand, provisional or final), in any currency, and any other credits,
indebtedness or claims in any currency, in each case whether direct or indirect,
absolute or contingent, matured or unmatured,
-58-
at any time held or owing by such Lender or any branch or agency thereof or bank
controlling such Lender to or for the credit or the account of the Borrower.
Each Lender agrees promptly to notify the Borrower after any such set-off and
application made by such Lender, provided that the failure to give such notice
--------
shall not affect the validity of such set-off and application.
9.8 Counterparts. This Agreement may be executed by one or more of the
------------
parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.
9.9 Severability. Any provision of this Agreement which is prohibited or
------------
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
9.10 Integration. This Agreement represents the entire agreement of the
-----------
Borrower, the Agent and the Lenders with respect to the subject matter hereof,
and there are no promises, undertakings, representations or warranties by the
Agent or any Lender relative to the subject matter hereof not expressly set
forth or referred to herein or in the other Loan Documents.
9.11 GOVERNING LAW. THIS AGREEMENT AND THE NOTES AND THE RIGHTS AND
-------------
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
CALIFORNIA (WITHOUT REFERENCE TO ITS CHOICE OF LAW RULES).
9.12 Alternative Dispute Resolution.
-------------------------------
(a) Claims Subject To Judicial Reference; Selection Of Referee. All
----------------------------------------------------------
Claims, including any and all questions of law or fact relating thereto, shall,
at the written request of any Party, be determined by Reference. The Parties
shall select a single neutral referee, who shall be a retired state or federal
judge with at least five years of judicial experience in civil matters. In the
event that the Parties cannot agree upon a referee, the referee shall be
appointed by the court. The Parties shall equally bear the fees and expenses of
the referee unless the referee otherwise provides in the statement of decision.
(b) Waiver Of Jury Trial. In connection with a Reference or any other
--------------------
action or proceeding, whether brought in state or federal court, the Parties
hereby expressly, intentionally and deliberately waive any right they may
otherwise have to trial by jury of any Claim.
(c) Conduct Of Reference. Except as provided in this Section 9.12, the
--------------------
Reference shall be conducted pursuant to Applicable State Law. The referee shall
determine all issues relating to the applicability, interpretation, legality and
enforceability of this Section 9.12.
(d) Provisional Remedies, Self-Help And Foreclosure. No provision of this
-----------------------------------------------
Section 9.12 shall limit the right of any party to (i) exercise self-help
remedies including set-off,
-59-
(ii) foreclose against or sell any Collateral or Guarantor Collateral, by power
of sale or otherwise or (iii) obtain or oppose provisional or ancillary remedies
from a court of competent jurisdiction before, after or during the pendency of
the Reference. The exercise of, or opposition to, any such remedy does not waive
the right of any Party to Reference pursuant to this Section 9.12.
(e) Limitation On Damages. In the event that punitive damages are
---------------------
permitted under Applicable State Law, the amount thereof shall not exceed a sum
equal to three times the amount of actual damages as determined by the referee.
(f) Severability. In the event that any provision of this Section 9.12 is
------------
found to be illegal or unenforceable, the remainder of this Section 9.12 shall
remain in full force and effect.
(g) Miscellaneous. In the event that multiple Claims are asserted, some
-------------
of which are found not subject to this Section 9.12, the Parties agree to stay
the proceedings of the Claims not subject to this Section 9.12 until all other
Claims are resolved in accordance with this Section. In the event that Claims
are asserted against multiple parties, some of whom are not subject to this
Section, the Parties agree to sever the Claims subject to this Section 9.12 and
resolve them in accordance with this Section 9.12. In the event of any challenge
to the legality or enforceability of this Section 9.12, the prevailing Party
shall be entitled to recover the costs and expenses, including reasonable
attorneys' fees, incurred by it in connection therewith. Applicable State Law
shall govern the interpretation of this Section 9.12.
(h) Defined Terms. As used in this Section 9.12, the following terms
-------------
shall have the respective meanings set forth below:
"Applicable State Law": the law of the State of California; provided,
--------------------
however, that if any Party seeks to (i) exercise self-help remedies, including
set-off, (ii) foreclose against or sell any Collateral or Guarantor Collateral,
by power of sale or otherwise or (iii) obtain or oppose provisional or ancillary
remedies from a court of competent jurisdiction before, after or during the
pendency of the Reference, the law of the state where such Collateral or
Guarantor Collateral, as the case may be, is located shall govern the exercise
of or opposition to such rights and remedies.
"Claim": any claim, cause of action, action, dispute or controversy
-----
between or among the Parties, whether sounding in contract, tort or otherwise,
which arises out of or relates to: (i) any of the Loan Documents; (ii) any
negotiations or communications relating to any of the Loan Documents, whether or
not incorporated into the Loan Documents or any indebtedness evidenced thereby;
or (iii) any alleged agreements, promises, representations or transactions in
connection therewith.
"Party": any Obligor, any Lender or the Agent.
-----
"Reference": a judicial reference conducted pursuant to this Section 9.12
---------
in accordance with Applicable State Law, as in effect at the time the referee is
selected pursuant to Section 9.12(a).
9.13 Acknowledgements. The Borrower hereby acknowledges that:
----------------
-60-
(a) its has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the Notes and the other Loan Documents;
(b) neither the Agent nor any Lender has any fiduciary relationship to the
Borrower solely by virtue of any of the Loan Documents, and the relationship
pursuant to the Loan Documents between the Agent and the Lenders, on one hand,
and the Borrower on the other hand, is solely that of creditor and debtor; and
(c) no joint venture exists among the Lenders or among the Borrower, on
one hand and the Lenders, on the other hand.
9.14 Headings. Section headings herein are included for convenience of
--------
reference only and shall not constitute a part of this Agreement for any other
purpose.
9.15 Copies of Certificates, Etc. Whenever the Borrower is required to
---------------------------
deliver notices, certificates, opinions, statements or other information
hereunder to the Agent for delivery to any Lender (including under Article 4),
it shall do so in such number of copies as the Agent shall reasonably specify.
9.16 Publicity. The Agent shall have the right to review and approve, in
---------
advance, any public announcements (in any form) and any filings describing or
quoting from the credit arrangements reflected in this Agreement and the other
Loan Documents, provided, however, that the Borrower (i) shall be permitted to
-------- -------
file copies of any Loan Document with the FCC or any other governmental agency
as required by law and (ii) shall also be permitted to disclose information
concerning the Loan Documents if the Borrower's attorneys reasonably believe
that such disclosure is required by law.
9.17 Confidentiality. The Lenders shall take normal and reasonable
---------------
precautions to maintain the confidentiality of all non-public information
obtained pursuant to the requirements of this Agreement which has been
identified as such by the Borrower, but may, in any event, make disclosures (i)
reasonably required by any bona fide transferee, assignee or participant in
connection with the contemplated transfer or assignment of any of the
Commitments or Loans or participations therein or (ii) as required or requested
by any governmental agency or representative thereof or as required pursuant to
legal process or (iii) to its attorneys and accountants or (iv) as required by
law or (v) in connection with litigation involving any Lender; provided that
such transferee, assignee or participant agrees to comply with the provisions of
this Section 9.17 unless specifically prohibited by applicable law or court
order. In no event shall any Lender be obligated or required to return any
materials furnished by the Borrower or any Subsidiary.
-61-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Los Angeles, California by their proper and duly
authorized officers as of the day and year first above written.
BORROWER
--------
LCG ACQUISITION CORPORATION
By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Chairman/CEO
AGENT
-----
UNION BANK OF CALIFORNIA, N.A., as Agent
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Vice President
LENDERS
-------
UNION BANK OF CALIFORNIA, N.A.,
as a Lender
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Vice President
Commitment: $115,000,000
Address for Notices
-------------------
(a) For Credit:
----------
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(b) For Operations:
--------------
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Approved Lending Offices
------------------------
Applicable Lending Office for Base Rate Loans:
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Applicable Lending Office for LIBOR Loans:
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
EXHIBIT A
---------
TO TERM LOAN AGREEMENT
----------------------
FORM OF NOTE
------------
$____________ Los Angeles, California
____________, ____
FOR VALUE RECEIVED, the undersigned, Latin Communications Group Inc., a
Delaware corporation (the "Borrower"), hereby unconditionally promises to pay to
--------
the order of ______________________________ (the "Lender"), in lawful money of
------
the United States and in immediately available funds, the lesser of (1)
_____________ and (2) the aggregate unpaid principal amount of the Loan made by
the Lender to the undersigned pursuant to the Loan Agreement (as hereinafter
defined), on the Maturity Date (as defined in the Loan Agreement) and on such
other dates as are required under the Loan Agreement. Such payment shall be
made for the account of the Lender at the office of Union Bank of California,
N.A. located at 000 Xxxxx Xxxxxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000 or at
such other office as the holder of this Note may notify the undersigned and as
agreed to by Union Bank of California, N.A. The undersigned further agrees to
pay interest in like money at such office or such other office on the unpaid
principal amount hereof from time to time from the date hereof at the rates per
annum and on the dates specified in the Loan Agreement until such principal has
been paid in full (both before and after judgment to the extent permitted by
law).
This Note is one of the Notes referred to in the Term Loan Agreement dated
as of April 20, 2000 (as amended, supplemented, modified or restated from time
to time, the "Loan Agreement"), among LCG Acquisition Corporation, the Lender,
--------------
the other Lenders parties thereto and Union Bank of California, N.A., as agent
for the Lenders; is entitled to the benefits thereof and of the other Loan
Documents; and is subject to optional and mandatory prepayment in whole or in
part as provided therein. Capitalized terms used herein which are defined in
the Loan Agreement shall have such meanings unless otherwise defined herein or
unless the context otherwise requires.
Upon the occurrence of any one or more of the Events of Default specified
in the Loan Agreement, all amounts then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
therein.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF CALIFORNIA (WITHOUT REFERENCE TO ITS CHOICE OF LAW
RULES).
BORROWER
--------
LATIN COMMUNICATIONS GROUP INC.
By:_________________________
Name:_______________________
Title:______________________
-2-
EXHIBIT B
---------
TO TERM LOAN AGREEMENT
----------------------
ASSIGNMENT AND ACCEPTANCE
-------------------------
Date: _____________________
Reference is made to that certain Term Loan Agreement dated as of April 20,
2000 (as it may be amended, modified, supplemented or restated from time to
time, the "Loan Agreement") among (1) LCG ACQUISITION CORPORATION, a Delaware
--------------
corporation, (2) the several banks and other financial institutions from time to
time parties thereto (the "Lenders") and (3) Union Bank of California, N.A., as
-------
agent for the Lenders thereunder (in such capacity, the "Agent"). Terms defined
-----
and the rules of interpretation contained in the Loan Agreement have the same
meanings and application herein.
_________________ (the "Assignor") is a Lender under the Loan Agreement and
--------
agrees with _________________________ (the "Assignee") as follows:
--------
1. As of the Effective Date (as defined below), the Assignor hereby sells
and assigns to the Assignee, and the Assignee hereby purchases and assumes from
the Assignor, $_____________ in principal amount of the Assignor's
$_____________ Loan under the Loan Agreement (as in effect on the Effective Date
and without giving effect to other assignments by the Assignor that have become
or will be effective as of the Effective Date), together with the related rights
and obligations under the Loan Agreement and the other Loan Documents, which
assignment will result in the Assignee having a Commitment Percentage of ___%.
The Assignee hereby appoints and authorizes the Agent to exercise such powers as
are delegated to the Agent by Section 8 of the Loan Agreement and by the other
Loan Documents.
2. The Assignor (a) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (b) represents and warrants
that it has full power and authority, and has taken all action necessary, (i) to
execute and deliver this Assignment and any and all other documents required or
permitted to be executed or delivered by it in connection herewith and (ii) to
fulfill its obligations under, and consummate the transactions contemplated by,
this Assignment, and no governmental authorizations or other authorizations are
required in connection therewith; (c) represents and warrants that this
Assignment constitutes the legal, valid and binding obligation of the Assignor;
(d) makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with any Loan Document or any other instrument or document furnished
pursuant thereto, or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of any Loan Document or any other instrument
or document furnished pursuant thereto; and (e) makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Borrower or the performance or observance by the
Borrower of any of its obligations under the Loan Documents or any instrument or
document furnished thereto.
3. The Assignee (a) confirms that it has received copies of such of the
Loan Documents and other documents delivered pursuant to Section 4 of the Loan
Agreement as it has requested, together with a copy of the most recent financial
statements of the Borrower received by the Agent pursuant to Section 5.1 of the
Loan Agreement, and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment; (b) agrees that it will, independently and without reliance upon the
Agent, the Assignor or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Loan Documents; (c)
agrees that it will perform in accordance with their terms all of the
obligations that by the terms of the Loan Documents are required to be performed
by it as a Lender; (d) specifies as its Applicable Lending Offices the offices
set forth beneath its name on the signature pages hereof; (e) represents and
warrants, for the benefit of the Assignor, the Agent and the Borrower, that
under applicable law and treaties no taxes will be required to be withheld by
the Agent, the Borrower or the Assignor with respect to any payments to be made
to the Assignee with respect to the Loans; /1/[(f) attaches either U.S. Internal
Revenue Service Form W-9, W-8BEN or W-8ECI, or successor applicable form
certifying as to the Assignee's entitlement to claim complete exemption from
United States withholding taxes with respect to all payments to be made to the
Assignee under the Loan Agreement (and the Note held by it); (g) agrees, for the
benefit of the Assignor, the Agent and the Borrower, that it will provide to the
Assignor (and, in the event the Assignee becomes a Lender registered in the
Register, the Agent and the Borrower) a new Form X-0, X-0XXX or W-8ECI, or
successor applicable form upon the expiration or obsolescence of any previously
delivered form and comparable statements in accordance with applicable U.S. laws
and regulations and amendments duly executed and completed by Assignee, and that
it will comply from time to time with all applicable U.S. laws and regulations
with regard to such withholding tax exemption;] (h) represents and warrants that
it has full power and authority, and has taken all action necessary, to execute
and deliver this Assignment, and any and all other documents required or
permitted to be executed or delivered by it in connection with this Assignment
and to fulfill its obligations under, and to consummate the transactions
contemplated by, this Assignment, and no governmental authorizations or other
authorizations are required in connection therewith; and (i) represents and
warrants that this Assignment constitutes the legal, valid and binding
obligation of the Assignee.
4. The effective date for this Assignment shall be _________________ (the
"Effective Date"). Following the execution of this Assignment, it will be
---------------
delivered to the Agent for acceptance and recording by the Agent and, if
applicable, for acceptance by the Borrower.
_____________________
/1/ Bracketed provisions to be included if Assignee is organized under the laws
of any jurisdiction other than the United States or any state thereof.
5. Upon such acceptance and recording, as of the Effective Date, (a) the
Assignee shall be a party to the Loan Agreement and, to the extent provided in
this Assignment, shall have the rights and obligations of a Lender thereunder
and under the other Loan Documents as if the Assignee had been an original party
to the Loan Agreement and (b) the Assignor shall, to the extent provided in this
Assignment, relinquish its rights and be released from its obligations under the
Loan Agreement and the other Loan Documents.
6. Upon such acceptance and recording, from and after the Effective Date,
the Agent shall make all payments under the Loan Agreement and the other Loan
Documents in respect of the interest assigned hereby (including, without
limitation, all payments of principal, interest and fees with respect thereto)
to the Assignee. The Assignor and the Assignee shall make all appropriate
adjustments in payments under the Loan Agreement and the other Loan Documents
for periods prior to the Effective Date, as the case may be, directly between
themselves.
7. Concurrently with the execution of this Assignment, the Assignor shall
execute two counterpart original Requests for Registration, in the form of
Exhibit A to this Assignment, to be forwarded to the Agent. The Assignor and the
Assignee further agree to execute and deliver such other instruments, and take
such other action, as either party may reasonably request in connection with the
transactions contemplated by this Assignment, and the Assignor specifically
agrees to cause the delivery of two original counterparts of this Assignment and
the Request for Registration to the Agent for the purpose of registration of the
Assignee as a "Lender" pursuant to Section 9.6 of the Loan Agreement.
8. THIS ASSIGNMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF CALIFORNIA.
Assignor
--------
____________________________________
By:_________________________________
Name:_______________________________
Title:______________________________
Assignee
--------
____________________________________
By:_________________________________
Name:_______________________________
Title:______________________________
Applicable Lending Offices:
--------------------------
LIBOR Loans
-----------
Address:
____________________________________
____________________________________
____________________________________
Base Rate Loans
---------------
Address:
____________________________________
____________________________________
____________________________________
Address for Notices:
-------------------
____________________________________
____________________________________
____________________________________
Telephone No.:______________________
Telecopier No.:_____________________
Attention:__________________________
Consented to as of ____________, ____./2/
Borrower
--------
LATIN COMMUNICATIONS GROUP INC.
By:_________________________
Name:_______________________
Title:______________________
_______________________
/2/ To be completed if Borrower's consent required under Section 9.6(c) of the
Loan Agreement.
EXHIBIT A TO
------------
ASSIGNMENT AND ACCEPTANCE
-------------------------
REQUEST FOR REGISTRATION
------------------------
TO: UNION BANK OF CALIFORNIA, N.A., as Agent
THIS REQUEST FOR REGISTRATION is made as of the date of the enclosed
Assignment and Acceptance with reference to that certain Term Loan Agreement
dated as of April 20, 2000 (as it may be amended, modified, supplemented or
restated from time to time, the "Loan Agreement") among (1) LCG ACQUISITION
--------------
CORPORATION, a Delaware corporation, (2) the several banks and other financial
institutions from time to time parties thereto (the "Lenders") and (3) Union
-------
Bank of California, N.A., as agent for the Lenders thereunder (in such capacity,
the "Agent"). Terms defined and the rules of interpretation contained in the
-----
Loan Agreement have the same meanings and application herein.
The Assignor and the Assignee described below hereby request that the Agent
register the Assignee as a Lender pursuant to Section 9.6 of the Loan Agreement,
effective as of the Effective Date described in the enclosed Assignment and
Acceptance and, in connection with this request, certify to the Agent that the
enclosed Assignment and Acceptance sets forth the correct Commitment Percentage
and Loan of the Assignee.
Enclosed with this Request are (i) the registering and processing fee of
$3,500 payable to the Agent pursuant to Section 9.6 of the Loan Agreement, (ii)
two counterpart originals of the Assignment and Acceptance and (iii) the
original Note of the Borrower in favor of the Assignor in the principal amount
of its Loan. The Assignor and the Assignee hereby jointly request that the
Agent cause the Borrower to issue, pursuant to Section 9.6(c) of the Loan
Agreement, (i) a replacement Note, dated as of the same date as the original
note being replaced, in favor of the Assignor in the principal amount of the
balance of its Loan (after giving effect to the Assignment) and (ii) a new Note,
dated as of the Effective Date, in favor of the Assignee in the principal amount
of the Assignee's Loan.
IN WITNESS WHEREOF, the Assignor and the Assignee have executed this
Request for Registration by their duly authorized officers as of
________________, ____.
Assignor
--------
__________________________________
By:_______________________________
Name:_____________________________
Title:____________________________
Assignee
--------
__________________________________
By:_______________________________
Name:_____________________________
Title:____________________________
--------------------------------------------------------------------------------
CONFIRMATION OF REGISTRATION BY AGENT
-------------------------------------
TO: The Assignor and the Assignee referred to in the above Request for
Registration
The Agent referred to below hereby certifies that it has registered the
Assignee as a Lender under the Loan Agreement, effective as of the Effective
Date described above, with the Commitment Percentage and the Loan set forth for
the Assignee in the Assignment and Acceptance and has adjusted the registered
Commitment Percentage and Loan of the Assignor to reflect the assignment
effected by such Assignment and Acceptance.
UNION BANK OF CALIFORNIA, N.A.,
as Agent
By:__________________________________
Name:________________________________
Title:_______________________________
-2-
EXHIBIT C
---------
TO TERM LOAN AGREEMENT
----------------------
FORM OF NO DEFAULT/REPRESENTATION CERTIFICATE
---------------------------------------------
________________________________________, the ___________________ of the
_____________________, a Delaware corporation, hereby certifies in connection
with the Term Loan Agreement dated as of April 20, 2000 among LCG Acquisition
Corporation, the several banks and other financial institutions parties thereto
and Union Bank of California, N.A., as agent (the "Agent") (such Term Loan
-----
Agreement, as it may be amended, restated, modified or supplemented from time to
time, the "Loan Agreement"; capitalized terms used herein and not defined shall
--------------
have the meanings assigned to them in the Loan Agreement), as of the date set
forth below, that:
(i) the representations and warranties contained in the Loan
Agreement and in each other Loan Document and certificate or other writing
delivered to the Lenders prior to, on or after the Closing Date are correct on
and as of the Closing Date in all material respects as though made on and as of
the date hereof, except to the extent that such representations and warranties
expressly relate to an earlier date; and
(ii) no Default has occurred and is continuing on the Closing Date
or would result from the making of the Loan being made available on the Closing
Date pursuant to the Loan Agreement.
IN WITNESS WHEREOF, I HAVE HEREUNTO SIGNED MY NAME AS OF THIS ____ DAY OF
________________, ____:
By:________________________________
Name:______________________________
Title:_____________________________
EXHIBIT D
---------
TO TERM LOAN AGREEMENT
----------------------
FORM OF COVENANT COMPLIANCE CERTIFICATE
---------------------------------------
The undersigned, ____________________, the Chief Financial Officer of LATIN
COMMUNICATIONS GROUP INC., a Delaware corporation (the "Borrower"), refers to
--------
that certain Term Loan Agreement dated as of April 20, 2000 among the Borrower,
the several banks and other financial institutions parties thereto (the
"Lenders") and Union Bank of California, N.A., as agent for the Lenders (as it
-------
may be amended, modified, restated or supplemented from time to time, the "Loan
----
Agreement"; capitalized terms used herein and not defined shall have the
---------
meanings assigned to them in the Loan Agreement) and certifies as to the
accuracy of the following:
1. Total Interest Coverage Ratio
-----------------------------
a. Operating Cash Flow
i. Net Income after eliminating
extraordinary gains and
losses $_______
ii. provisions for taxes (to the
extent deducted from the
computation of Net Income) $_______
iii. depreciation and amortization
(to the extent deducted from the
computation of Net Income) $_______
iv. Interest Expense (see 1(b) below)
(to the extent deducted from the
computation of Net Income) $_______
v. permitted termination payments
owing by the Borrower resulting
from early termination of a time
brokerage agreement, local
marketing agreement or similar
agreement (to the extent deducted
from the computation of Net
Income) $_______
vi. operating losses from Stations
KVBC-FM and KRNV-FM, to
the extent that such losses are
incurred during the first twelve
months of such Stations being
on the air (to the extent deducted
from the computation of Net
Income) $_______
vii. other non-cash charges (to the
extent deducted from the
computation of Net Income) $_______
viii. non-cash revenues (to the
extent included in the calculation
of Net Income) $_______
ix. Corporate Overhead (to the
extent included in the calculation
of Net Income) $_______
x. i + ii + iii + iv + v + vi + vii $_______
- viii - ix
b. Interest Expense
i. amount of all interest on Total
Debt that was paid, payable
and/or accrued for such period
(without duplication of previous
amounts) $_______
ii. all commitment fees paid,
payable and/or accrued for such
period (without duplication of
previous amounts) to any
lender in exchange for such
lender's commitment to lend $_______
iii. net amounts payable (or
receivable) under all Interest
Rate Agreements $_______
iv. all interest income $_______
v. i + ii + iii - iv $_______
-2-
c. Ratio of a to b/1/: _____:1
2. Minimum Operating Cash Flow/2/ (see 1(a) above) $______
-----------------------------------------------
3. Unfunded Liabilities/3/ $______
As of the date hereof, the Chief Financial Officer represents and warrants
to the Lenders as follows:
a. The representations and warranties contained in each Loan Document and
certificate or other writing delivered to the Lenders are correct on
and as of the date hereof in all material respects, as though made on
and as of the date hereof (except to the extent that such
representations and warranties expressly relate to an earlier date, in
which case as of such date); and
b. no Default has occurred and is continuing.
IN WITNESS WHEREOF, I HAVE HEREUNTO SIGNED MY NAME, AS THE CHIEF FINANCIAL
OFFICER OF LATIN COMMUNICATIONS GROUP INC., AS OF __________, 200_.
LATIN COMMUNICATIONS GROUP INC.
________________________________________
Name:___________________________________
Chief Financial Officer
_________________________
/1/ Section 6.1(a) of the Loan Agreement requires that the Total Interest
Coverage Ratio for the period representing the number of whole months (not
exceeding 12 months) that have passed from and including May 1, 2000 to and
including the last day of the relevant fiscal quarter not be less than ____:1.
/2/ Section 6.1(b) of the Loan Agreement requires that the Operating Cash Flow
of the Borrower and its Subsidiaries on a consolidated basis for the 12 months
ended as of the end of the relevant fiscal quarter of the Borrower not be less
than $_________.
/3/ Section 6.12 of the Loan Agreement requires that unfunded liabilities for
any and all Plans maintained for or covering employees of the Borrower or any
Subsidiary not exceed $500,000 in the aggregate at any time.
-3-
EXHIBIT E
---------
TO TERM LOAN AGREEMENT
----------------------
FORM OF CONTINUATION NOTICE
---------------------------
Date:
To: Union Bank of California, N.A.,
as Agent
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Communications/Media Division
Re: LATIN COMMUNICATIONS GROUP INC., a Delaware corporation
We refer to that certain Term Loan Agreement dated as of April 20, 2000
among LCG Acquisition Corporation, the several banks and other financial
institutions parties thereto and Union Bank of California, N.A., as agent (such
Term Loan Agreement, as amended, modified, supplemented or restated from time to
time, the "Loan Agreement"). Capitalized terms used herein and not defined have
--------------
the meanings assigned to them in the Loan Agreement.
[Pursuant to Section 2.4(a) of the Loan Agreement, the undersigned elects
to convert the following LIBOR Loans to Base Rate Loans at the end of the
current Interest Period for such LIBOR Loans:
LIBOR Loan Amount Last Day of Current Interest Period
----------------- -----------------------------------
1.
2.
3. [and so on] ]
[Pursuant to Section 2.4(a) of the Loan Agreement, the undersigned elects
to convert Base Rate Loans in the aggregate amount of $__________ to LIBOR
Loan(s) as follows:
Desired Date Length of
LIBOR Loan Amount of Conversion Interest Period
----------------- ------------- ---------------
1.
2.
3. [and so on] ]
[Pursuant to Section 2.4(b) of the Loan Agreement, the undersigned elects
to continue the following LIBOR Loans for the following additional Interest
Periods:
Last Day of Current Length of Continued
LIBOR Loan Amount Interest Period Interest Period
----------------- --------------- ---------------
1.
2.
3. [and so on] ]
Sincerely,
BORROWER
--------
LATIN COMMUNICATIONS GROUP INC.
By:____________________________
Name:__________________________
Title:_________________________
-2-
Schedule 3.1
------------
Good Standing/Foreign Qualifications Jurisdictions
1. Latin Communications Group Inc.
Organized: Delaware
Qualified to do Business: New York
2. Latin Communications Inc.
Organized: Delaware
Qualified to do Business: California, New York
3. Vea Acquisition Corp.
Organized: Delaware
Qualified to do Business: California, New York
4. Latin Radio of Washington D.C., L.L.C.
Organized: Delaware
Qualified to do Business: Maryland
5. Latin Communications Group Television Inc.
Organized: Delaware
Qualified to do Business: Florida
6. Latin Communications EXCL Inc.
Organized: Delaware
Qualified to do Business: California
7. LCG Holdings, L.L.C.
Organized: Delaware
Qualified to do Business: None
8. EXCL Holdings, Inc.
Organized: Illinois
Qualified to do Business: California
9. EXCL Communications, Inc.
Organized: Illinois
Qualified to do Business: California
Note: doing business in California as EXCL Radio
----- Communications, Inc.
10. Norte Broadcasting of Colorado, Inc.
Organized: Illinois
Qualified to do Business: California, Colorado
11. SUR Broadcasting of Colorado, Inc.
Organized: Illinois
Qualified to do Business: California, Colorado
12. SUR Broadcasting of New Mexico, Inc.
Organized: New Mexico
Qualified to do Business: California
13. Norte Broadcasting of New Mexico, Inc.
Organized: New Mexico
Qualified to do Business: None
14. Metro Mix, Inc.
Organized: Illinois
Qualified to do Business: California
15. Radio Exito, Inc.
Organized: Nevada
Qualified to do Business: California
16. Pacifico Broadcasting, Inc.
Organized: California
Qualified to do Business: None
17. Sur Broadcasting, Inc.
Organized: California
Qualified to do Business: None
18. Norte Broadcasting, Inc.
Organized: California
Qualified to do Business: None
19. Sur Broadcasting of San Diego, Inc.
Organized: California
Qualified to do Business: None
20. Embarcadero Media, Inc.
Organized: Delaware
Qualified to do Business: California
21. Portland Radio, Inc.
Organized: Washington
Qualified to do Business: California, Oregon
22. Riverside Radio, Inc.
Organized: California
Qualified to do Business: None
23. EMI Sacramento Radio, Inc.
Organized: California
Qualified to do Business: None
24. EMI Los Angeles Radio, Inc.
Organized: California
Qualified to do Business: None
25. Norte Broadcasting of Nevada, Inc.
Organized: Nevada
Qualified to do Business: None
Schedule 3.2
------------
Required Consents
Consents of Landlords/Licensors set forth on Schedule 3.5B are as follows:
EMI Los Angeles Radio, Inc.
---------------------------
i. Lease dated November 1, 1994 (Zufu Properties, Co., Ltd.).
EMI Sacramento Radio, Inc.
--------------------------
i. Lease dated May 27, 1994 (between Great American Television and Radio
Company, Inc. and Xxxxxx-Xxxxxxx Broadcasting Corporation, Inc., now
assigned to EMI Sacramento Radio, Inc.).
EXCL Communications, Inc.
-------------------------
i. Office Lease Dated January 12, 2000 (Tropicana Office Investments,
L.L.C.).
ii. Lease dated October 3, 1996 (Candeleria Business Park Associates,
L.P.).
Metro Mix, Inc.
---------------
i. Lease Agreement and Option to Purchase dated June 1, 1990, as amended
(Xxxxxxxxxx Capital Corporation).
Norte Broadcasting, Inc.
------------------------
i. Lease of State Lands dated June 28, 1996 (State of Colorado).
Riverside Radio, Inc.
---------------------
i. Lease dated May 15, 1990 (Unum Life Insurance Co., now American
Pacific Financial Corporation).
Schedule 3.5A
-------------
Intellectual Property
1. FCC Licenses Owned by LCG Subsidiaries
KBRG(FM), San Jose, California
------------------------------
Xxxx Xxxxxxx
Xxxxx XXX XXXX-000
X000XX, Los Gatos, California
-----------------------------
Main Station
Intercity Relay XXXX-000
XXXX(XX), Xxx Xxxx, Xxxxxxxxxx
------------------------------
Main Station
R/P Base Station KOS 331
KSES-FM, Seaside, California
----------------------------
Main Station
KSES(AM), Soledad, California
-----------------------------
Main Station
Direct Measurement
KLOK-FM, Greenfield, California
-------------------------------
Main Station
Aural STL WGX-250
FM Translator K260AA, Carmel Valley, California
-----------------------------------------------
Main Station
KMXA(AM), Aurora, California
----------------------------
Main Station
KJMN(FM), Castle Rock, Colorado
-------------------------------
Main Station
Aural STL WHS-701
R/P Base Mobile System XXX-000
Xxxxx XXX XXX-000
XXXX(XX), Xxxxxxxxxxx
---------------------
Main Station
Direct Measurement
KRZY(FM), Santa Fe, New Mexico
------------------------------
Main Station
Construction Permit (to correct coordinates)
Direct Measurement
Earth Station E950068
---------------------
Authorization
KRCX-FM, Marysville, California
-------------------------------
Main Station
R/P Base Station KPE-548
R/P Auxiliary - KQY-890
Aural STL - XXX-000
XXXX(XX), Xxxxxxxx, California
------------------------------
Main Station
Auxiliary Antenna
Aural STL WLG-908
Auxiliary R/P KC - 25214
KSZZ(AM), San Bernardino, California
------------------------------------
Main Station
KSSE(FM), Riverside, California
-------------------------------
Main Station
KRRE(FM), Shingle Springs, California
-------------------------------------
Main Station
Aural STL WPNM-947
Aural STL WPJB-933
WACA(AM), Wheaton, Maryland
---------------------------
Main Station
KRNV(FM), Reno Nevada
---------------------
2. Trademarks and Copyrights
Owner Jurisdiction Trademark Ser./Reg No.
==============================================================================================
Latin Communications Group Inc. USA EL DIARIO LA PRENSA 1,863,697
----------------------------------------------------------------------------------------------
EMI Sacramento Radio, Inc. USA KRCX 1110AM RADIO 1,466,610
CAPITAL
EMI Sacramento Radio, Inc. (still USA LA SUPER X 2,070,252
assigned of record to
Marysville Radio, Inc.)
==================================================================================================
EXCL Communications, Inc. USA MARKETSPAN 1,781,772
EXCL Communications, Inc. USA OK RADIO 1,823,220
EXCL Communications, Inc. USA XXXXXX SUPER 1,824,629
XXXXXXXX
greater than STAR less than
EXCL Communications, Inc. USA SUPER XXXXXXXX XX 1,838,138
greater than STAR less than
EXCL Communications, Inc. USA RADIO TRICOLOR 1,993,998
EXCL Communications, Inc. USA RADIO ROMANTICA 2,021,380
greater than RADIO ROMANTIC less than
EXCL Communications, Inc. USA RADIO TRICOLOR 2,025,873
MEXICANISIMA
EXCL Communications, Inc. USA MEXICANISMA 75/781,280
=================================================================================================
3. The following marks related to the KINK station were sold to American Radio
Systems, Inc. pursuant to the Asset Exchange Agreement, dated April 21,
1997, among LCG, EXCL Communications, Inc., Portland Radio, Inc., Radio
Exito, Inc. and American Radio Systems, Inc., as amended on January 5,
1998: "KINK," "SATURDAY NIGHT CD," "FOCUS," "SUNDAY NIGHT JAZZ," "SUNDAY
MORNING JAZZ," "TRUE TO THE MUSIC." This Agreement closed on May 27, 1998,
but these marks have not yet been recorded as sold.
4. The marks "SUPERTALK" and "RADIO THAT BITES" were sold to Citicasters,
Co. pursuant to the Sale Agreement dated February 26, 1997, between
EXCL Communications, Inc. and Citicasters, Co. This Agreement closed
on May 5, 1997, but these marks have not yet been recorded as sold.
5. The following copyrights were sold to Citicasters, Co. pursuant to the
Sale Agreement, dated February 26, 1997, between EXCL Communications,
Inc. and Citicasters, Co.: "a stack of records" (PAu918-684), "177
records" (PAu915-406), "the kink primate test, cut 1" (PA 286-755) and
"the kink primate test, cut 2" (PA 308-003). This Agreement closed on
May 5, 1997, but these marks have not yet been recorded as sold.
6. Internet domain names:
XXXXXXXXX.XXX
XXXXXXXXXXXXX.XXX
XXXX.XXX
XXXX.XXX
XXXX.XXX
XXXX.XXX
XXXX.XXX
XXXXXXXXXXXXX.XXX
XXXXXXXXXXXXX.XXX
XXXXXXXXXXXXXX.XXX
7. See, also, Section (e) of Schedule 3.8.
Schedule 3.5B
-------------
Real Property
A. Owned Real Property
--------------------
PROPERTY OWNER
0000 Xxxxxxx Xxxxxx, #000 EMI Sacramento Radio, Inc. /1/
Sacramento, CA
--------------------------------------------------------------
000 Xxxx Xxxx Xx.
Xxx Xxxxxxxxxx, XX San Bernardino, Inc./2/
--------------------------------------------------------------
0000 Xxxxxxx Xxxx,
Xxxxxxxxxx, XX Marysville, Radio, Inc./3/
--------------------------------------------------------------
B. Real Property Leases
--------------------
1. Lease, dated October 31, 1997, by and between LCG and the Xxxxxx,
Churchwardens and Vestrymen of Trinity Church in the City of New York.
2. Lease, dated July 30, 1997, by and between Vea Acquisition Corp. and
Corporate Realty Income Fund I, L.P.
3. Site Lease, dated January 24, 1995, by and between GPA Enterprises, Inc.
and Century Broadcasting Corporation. Consent to Assignment, dated June
4, 1996, by GPA Enterprises, Inc. of the assignment by Century
Broadcasting Corporation to Sur Broadcasting of Colorado Inc.
4. Lease, dated January 4, 1994, by and between Pen Nom I Corporation by
the Equitable Life Assurance Society of the U.S. and Century
Broadcasting Corporation, as amended. Assignment and Assumption and
Consent to
-------------
/1/ Subject to any liens or encumbrances set forth in the California Title
Association Title Report, dated March 31, 1998 re 0000 Xxxxxxx Xxxxxx, #000,
Xxxxxxxxxx, XX. The underlying indebtedness secured by any liens referenced
on this report and showing Greyhound Financial Corporation or First National
Bank of Boston as the secured party has been satisfied. LCG will take
commercially reasonable steps to remove such liens.
/2/ Subject to any liens or encumbrances set forth in the California Title
Association Title Report, dated March 26, 1998 re 000 Xxxx Xxxx Xx., Xxx
Xxxxxxxxxx, XX. The underlying indebtedness secured by any liens referenced
on this report and showing Greyhound Financial Corporation as the secured
party has been satisfied. LCG will take commercially reasonable steps to
remove such liens.
/3/ 3 Marysville, Radio, Inc. merged into Roseville Radio, Inc. Roseville
Radio, Inc. later became EMI Sacramento Radio, Inc. This property will be
sold upon consummation of the Asset Purchase Agreement dated April 8, 1999
between Xxxx Broadcasting and EMI Sacramento Radio, Inc.
Assignment Agreement, dated June 25, 1996, by and among Pen Nom I
Corporation (WHTRI Real Estate L.P. as successor), Century Broadcasting
Corporation (Sur Broadcasting of Colorado, Inc. as assignee).
5. Lease of State Lands, dated June 28, 1996, by and between the State of
Colorado and Norte Broadcasting, Inc.
6. Lease Agreement and Option to Purchase, dated June 1, 1990, between
Xxxxxxxxxx Capital Corp. and Bahia Radio, Inc. (assigned to Metro Mix,
Inc.), as amended.
7. Office Lease, dated December 1, 1996, by and between RNM 135 Main, L.P.
and Metro Mix, Inc.
8. Assignment of Grants of Easement, dated January 12, 1994, by and between
Mt. Xxxxxx XX Broadcasters, Inc. and Norte Broadcasting, Inc.
9. License, by and between Xxxxxxx X. Sight and Mt. Xxxxxx XX Broadcasters.
First Amendment to License Agreement, dated October 4, 1993, by and
between Diablo Communications (assignee) and Mt. Xxxxxx XX Broadcasters.
Assignment of License Agreement, dated January 12, 1995, by and among
Diablo Communications, Inc., Mt. Xxxxxx XX Broadcasters, Inc. and Norte
Broadcasting, Inc.
10. Easement Grant, dated September 2, 1997, by and among Xxxxxxx X. Xxxxx,
Xxxxx X. Xxxxx, Xxxxx Xxxxx, EXCL Communications, Inc. Sur Broadcasting,
Inc., Norte Broadcasting, Inc. and LCG.
11. Tower Lease, dated June 3, 1987, by and among Xxxxxx X. Xxxxx and Xxxxxxx
X. Xxxxx and KMBY Radio, Inc. (assigned to Pacifico Broadcasting, Inc.),
as amended.
12. Antenna Space Lease, dated April 23, 1996, by and between Radio Exito,
Inc. and Destineer, as amended on December 8, 1997.
13. Lease, dated October 3, 1996, by and between EXCL Communications, Inc.
and Candeleria Business Park Associates, L.P.
14. Lease, dated March 17, 1994, by and between Broadcast Properties, Inc.
and Commonwealth Broadcasting of Northern California. Sublease Agreement,
dated October 9, 1996, by and between Citadel Broadcasting Company
(successor to Commonwealth Broadcasting of Northern California) and Sur
Broadcasting of New Mexico, Inc. Agreement, dated January 27, 1999,
between Citadel Broadcasting Company, EXCL Communications, Inc., Norte
Broadcasting of New Mexico, Inc. and Sur Broadcasting of New Mexico, Inc.
Antenna Site Lease, dated January 27, 1999, between Citadel Broadcasting
Company and Sur Broadcasting of New Mexico, Inc.
15. Radio Antenna and Equipment Space Lease, dated November 1, 1993, by and
between SON Broadcasting, Inc. and The Braiker Family Trust d/b/a KOLT.
Assignment and Assumption of Lease, dated October 1996, between Crescent
Communications L.P. (assignee of The Braiker Family Trust) and Norte
Broadcasting of New Mexico, Inc.
16. Lease and Option to Purchase, dated October 29, 1993, by and among Xxxxxx
X. Xxxxx and Xxxxxx X. Xxxxx as Trustees for the Xxxxx Family Trust and
Redlands Radio, Inc. (now Riverside Radio, Inc.).
17. Lease, dated May 15, 1990, by and between Unum Life Insurance Co. (now
American Pacific Financial Corporation) and Xxxxx Broadcasting Company
(assigned to Riverside Radio, Inc.), as amended.
18. License Agreement, dated August 11, 1987, between Atlas Land Company and
Xxxxx Broadcasting Co. (assigned to EMI Los Angeles Radio, Inc.).
19. License Agreement, dated December 12, 1994, by and between Xxxxx
Broadcasting Co. and San Bernardino Radio, Inc. (now EMI Los Angeles
Radio, Inc.).
20. Easement, dated July 25, 1986, by and between Orange Show Plaza
Associates and Xxxxx Broadcasting Co. (assigned to EMI Los Angeles Radio,
Inc.).
21. Restated Easement Agreement, dated February 6, 1987, by and between
Orange Show Plaza Associates and Xxxxx Broadcasting Company (assigned to
EMI Los Angeles Radio, Inc.), as amended on August 14, 1987 and February
24, 1988.
22. License Agreement, dated February 6, 1987, by and between Orange Show
Plaza Associates and Xxxxx Broadcasting Co. Assignment (assigned to EMI
Los Angeles Radio, Inc.).
23. Parcel 6 Easement Agreement, dated February 6, 1987, by and between
Xxxxxxx X. Xxxxxxxxxxx/ Trustee of Xxxxxxxxxxx Family Trust (successor to
Orange Show Plaza Associates) and Xxxxx Broadcasting Co. (assigned to EMI
Los Angeles Radio, Inc.)
24. Parcel 6 License Agreement, dated February 6, 1987, by and between
Xxxxxxx X. Xxxxxxxxxxx/ Trustee of Xxxxxxxxxxx Family Trust (successor to
Orange Show Plaza Associates) and Xxxxx Broadcasting Co. (assigned to EMI
Los Angeles Radio, Inc.)
25. Space Lease Agreement, dated August 1, 1994, by and between Xxxxx
Microwave Enterprises and Redlands Radio, Inc. (now Riverside Radio,
Inc.).
26. License Agreement, dated November 15, 1995, between Xxxxx Microwave
Enterprises and EMI Los Angeles Radio, Inc.
27. Lease, dated May 27, 1994, by and between Great American Television and
Radio Company, Inc. and Xxxxxx-Xxxxxxx Broadcasting Corporation, Inc.
Assignment of Lease, dated August 31, 1994, by Xxxxxx-Xxxxxxx
Broadcasting Corporation, Inc. to Roseville Radio, Inc. (now EMI
Sacramento Radio, Inc.).
28. License Agreement, dated October 14, 1994, by and between TOR
Broadcasting Corporation and Marysville Radio, Inc. (now EMI Sacramento
Radio, Inc.).
29. License Agreement, dated June 1, 1995, by and between Rosebud Properties
and Roseville Radio, Inc. (now EMI Sacramento Radio, Inc.).
30. Lease, dated February 1998, by and between EXCL Communications, Inc. and
Equifax Credit Information Systems, Inc. Notice of Cancellation, dated
October 27, 1999.
31. Lease, dated November 1, 1994, by and between Zufu Properties Co., Ltd.
by and through Total Properties Management, and San Bernardino Radio,
Inc. (now EMI Los Angeles Radio, Inc.), with Embarcadero Media, Inc. as
guarantor, as amended.
32. Storage Agreement, dated December 8, 1995, by and between Zufu Properties
Co., Ltd. and San Bernardino Radio, Inc. (now EMI Los Angeles Radio,
Inc.).
33. Lease, dated May 5, 1997, by and between Portland Radio Inc. and
Citicasters, Inc.
34. Agreement to lease SCA Sub-Carrier Capacity, dated February 1, 1985,
between American Diversified Capital Corporation and United Broadcasting
Co., and assigned to American Radio Systems, subsequently assigned to
Portland Radio, Inc.
35. Lease Agreement dated December 3, 1991 between United Broadcasting Co.,
d/b/a KBAY and Radio Sedaye Iran, Inc./X. Xxxxxxxx, and assigned to
American Radio Systems, subsequently assigned to Portland Radio, Inc.
36. Agreement dated February 19, 1987 between Audio House, Inc. d/b/a Radio
Station KOME and United Broadcasting Co. d/b/a KBAY (Lessee), and
assigned to American Radio Systems, subsequently assigned to Portland
Radio, Inc.
37. Lease, dated July 27, 1972, and Amendment thereto, dated July 8, 1987,
between KNTV Inc. and United Broadcasting Co. for transmitter tower in
Santa Clara, California, subsequently assigned to Portland Radio, Inc.
38. Translator Lease Agreement, dated February 6, 1997, between American
Radio Systems Corporation, American Radio Systems Radio License Corp.
("ARSLC") and United Broadcasting Co., and assigned to American Radio
Systems, subsequently assigned to Portland Radio, Inc.
39. Office Building Lease, dated April 18, 1994, between Gold River Limited
and Olympic Broadcasters, Inc. (Tenant), and assigned to American Radio
Systems, subsequently assigned to Radio Exito, Inc.
40. Grant of Easement, dated September 22, 1997, between Brush Creek Co. and
American Radio Systems, subsequently assigned to Radio Exito, Inc.
41. Radio Tower Lease Agreement, dated July 1, 1990, between Halldark
Enterprises (Lessor) and Lobster Communication, Inc., as amended as of
April 16, 1996 and January 31, 1997, and assigned to American Radio
Systems, subsequently assigned to Latin Communications Inc.
42. Basic Commercial Lease, dated October 22, 1998, between Pacifico
Broadcasting, Inc. as Lessee and Xxxxxxx Xxxxx as Lessor, for the
property located at 000 Xxxxxx Xxxxxx, Xxxxxxx, XX 00000.
43. Antenna and Equipment Space Lease, dated May 6, 1998, between EXCL
Communications (KRZY) as Lessee and Son Broadcasting, Inc. as Lessor, for
the property located at 0000 Xxxxxxx Xxxxx X.X, Xxxxxxxxxxx, XX 00000
(Sur Broadcasting of New Mexico).
44. Lease Agreement, dated June 1, 1995, between Roseville Radio, Inc. as
Lessee and American Tower System/Rosebud Properties, Inc. as Lessor, for
the property located at 0000 Xxxxxxx Xxxx Xxxxxxxxxx XX (EMI Sacramento
Radio, Inc.).
45. Lease Agreement, dated August 8, 1994, between Airport High Rise, Inc.
and Embarcadero Media, Inc.
46. Lease Agreement, dated August 27, 1999, between EXCL Communications, Inc.
and WTA Xxxxxxxx Technology Park LLC.
47. Lease Agreement, dated September 24, 1989, between Colorado State Board
of Land Commissioners and Century Broadcasting. Renewal Lease, dated June
26, 1996, between Colorado State Board of Land Commissioners and Norte
Broadcasting of Colorado, Inc.
48. Site Agreement, dated September 30, 1999, by and between EMI Sacramento
Radio, Inc. and Xxx Xxxx d/b/a Xxxx Broadcasting.
49. Office Lease, dated January 12, 2000, between Tropicana Office
Investments, L.L.C. and EXCL Communications, Inc.
50. Commercial Lease, between Xxxxxxxxx Xxxxxxx, Trustee and Norte
Broadcasting of Nevada, Inc.
Schedule 3.5C
-------------
Operating Names/Trade Names
El Diario/La Prensa
EXCL Radio Communications, Inc.
EXCL Spanish Network
Schedule 3.6
------------
Capital Structure/Equity Ownership
All of the assets of LCG (including, without limitation, all of the issued
equity interests of the LCG subsidiaries) are pledged to Suntrust pursuant to:
the Credit Agreement, dated October 22, 1999, among Latin Communications Inc.,
the lenders named there and Suntrust; the Guaranty, dated October 22, 1999,
among LCG and the LCG Subsidiaries (other than Latin Communications Group Inc.)
in favor of Suntrust; the Pledge Agreement, dated as of October 22, 1999, among
Latin Communications Inc., LCG and the LCG Subsidiaries in favor of Suntrust;
and the Security Agreement, dated October 22, 1999, among Latin Communications
Inc., LCG, the LCG Subsidiaries and Suntrust.
1. Latin Communications, Inc.
Authorized Common Shares: 000
Xxxxxxxxxxx Xxxxxx Shares: 100
Ownership: Latin Communications Group, Inc. (100 Shares)
2. Vea Acquisition Corp.
Authorized Common Shares: 1,000
Outstanding Common Shares: 100
Ownership: Latin Communications, Inc. (100 Shares)
3. Latin Communications Group Television, Inc.
Authorized Shares: 1,000
Outstanding Shares: 100
4. Latin Radio of Washington, D.C., L.L.C.
N/A
5. Latin Communications EXCL Inc.
Authorized Common Shares: 1,000
Outstanding Common Shares: 100
Ownership: Latin Communications, Inc. (80 Shares)
Latin Communications Group, Inc. (20 Shares)
6. EXCL Holdings, Inc.
Authorized Common Shares: 100,000
Issued Common Shares: 10,500
Ownership: Latin Communications EXCL, Inc (8,400 Shares)
Xxxxxxxxxxx & Xxxxxx Xxxxx (2,100 Shares)
7. EXCL Communications, Inc.
Authorized Common Shares:
Class A Common: 1,966,111
Class B Common: 3,195,000
Convertible Preferred: 2,150,000
Series II Preferred: 1,200,000
Issued Shares:
Class A Common: 1,450,000
Class B Common: 0
Convertible Preferred: 2,150,000
Series II Preferred: 510,931
Ownership:
Class A Common: EXCL Holdings, Inc.
(1,450,000 Shares)
Series II Preferred: Latin Communications Group,
Inc. (2,150,000 Shares)
Series II Preferred: Latin Communications Group,
Inc. (510,931 Shares)
8. Embarcadero Media, Inc.
Authorized Common Shares: 1,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
9. EMI Los Angeles Radio, Inc.
Authorized Common Shares: 100,000
Series E Preferred: 7,500
Issued Shares:
Common: 100,000
Series E Preferred: 7,500
Ownership:
Common: Embarcadero Media, Inc.
(100,000 Shares)
Series E Preferred: Embarcadero Media, Inc.
(7,500 Shares)
10. EMI Sacramento Radio, Inc.
Authorized Shares:
Common Shares: 200,000
Series C Preferred: 5,000
Issued Shares:
Common Shares: 200,000
Series C Preferred: 5,000
Ownership:
Common: Embarcadero Media, Inc.
(200,000 Shares)
Series C Preferred: Embarcadero Media, Inc.
(5,000 Shares)
11. Metro Mix, Inc.
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
(1,000 Shares)
12. Norte Broadcasting, Inc.
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
(1,000 Shares)
13. Norte Broadcasting of Colorado, Inc.
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
(1,000 Shares)
14. Norte Broadcasting of New Mexico, Inc.
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
(1,000 Shares)
15. Pacifico Broadcasting, Inc.
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications Inc.
(1,000 Shares)
16. Portland Radio, Inc.
Authorized Common Shares: 4,500,000
Series A Preferred Stock: 7,500
Issued Shares:
Common: 3,979,732
Series A Preferred: 7,500
Ownership:
Common: Embarcadero Media, Inc.
(3,979,732 Shares)
Series A Preferred: Embarcadero Media, Inc.
(7,500 Shares)
17. Radio Exito, Inc.
Authorized Common Shares: 25,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
18. Riverside Radio, Inc.
Authorized Common Shares: 1,000
Series B Preferred: 2,600
Issued Shares:
Common: 1,000
Series B Preferred: 2,600
Ownership:
Common: Embarcadero Media, Inc.
(1,000 Shares)
Series B Preferred: Embarcadero Media, Inc.
(2,600 Shares)
19. Sur Broadcasting Inc.
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
(1,000 Shares)
20. Sur Broadcasting of Colorado, Inc.
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
(1,000 Shares)
21. Sur Broadcasting of New Mexico, Inc.
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
(1,000 Shares)
22. Sur Broadcasting of San Diego, Inc./4/
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
23. Norte Broadcasting of Nevada, Inc.
Authorized Common Shares: 5,000
Issued Common Shares: 1,000
Ownership: EXCL Communications, Inc.
(1,000 Shares)
24. Latin Communications Group, Inc.
Authorized Common Shares: 1,000
Issued Common Shares 1,000
Ownership: Entravision Communication
Company, L.L.C. (1,000 Shares)
25. LCG Holdings, L.L.C.
Member Capital Contribution: $1,000.00
Contributed By: Latin Communications Group,
Inc.
Percentage Interest: 100%
-----------------
/4/ This is an inactive corporation, which is currently in the process of
being dissolved. To the best of LCG's information, a stock certificate was never
issued for these shares.
Schedule 3.7
------------
Subsidiaries, Affiliates and Investments
See Schedule 3.1 for subsidiary information. There are no affiliates and/or
investments.
Schedule 3.8
------------
Material Contracts
A. Collective Bargaining Agreements.
---------------------------------
1. Agreement, dated December 14, 1994, by and between El Diario
Associates and the NMDU (incorporating consistent portions of the
Agreement effective March 31, 1981 through March 30, 1984 by and
between the NMDU, the News and The New York Times).
2. Agreement, dated October 26, 1999, between the Guild and El Diario
Associates.
3. Agreement, dated December 14, 1994, between El Diario Associates L.P.
and the NMDU (incorporating consistent portions of the Agreement
affective March 31, 1981 through March 30, 1984 between NMDU, the New
and The New York Times), as amended.
B. Material licenses or similar agreements permitting the use of Intellectual
--------------------------------------------------------------------------
Property Assets.
---------------
1. Promotion Agreement, dated August 14, 1997, by and between EXCL
Communications, Inc. and Logic Communications, Incorporated.
2. Agreement, dated February 28, 1998, by and between LCG and News 12 The
Bronx L.L.C.
3. NSN Network Services Satellite Service Agreement, by and between EXCL
Communications, Inc. and NSN Network Services Ltd.
4. Promotional Package License Agreement, dated June 27, 1997, by and
between EXCL Communications, Inc. and Celestial Mechanix Incorporated.
5. All of the radio stations have Standard License Agreements with RCS
Sound.
6. Affiliation Agreement, dated June 10, 1999, between KBUF Partnership
and EXCL Communications, Inc.
7. The radio stations have Network Radio Affiliate Agreements with Metro
Traffic, Inc. to provide traffic and daily news reports.
8. The radio stations have local blanket radio licenses with the
American Society of Composers, Authors and Publishers (ASCAP),
Broadcast Music, Inc. (BMI), SESAC and CBSI and have licenses to
receive and use Arbitron reports, including Scarborough and
Maximizer reports.
9. The radio stations have programming agreements, music library
licenses and production library licenses in the ordinary course of
business.
10. Software Consulting Services Agreement, dated January 8, 1999,
between El Diario / La Prensa and Software Consulting Services.
See, Items 17, 18, 19, 20, 21, 22, 23 and 24 on Schedule 3.11 and
Schedule 3.5A.
C. Stock Purchase Agreement, Asset Purchase Agreement or other acquisition or
---------------------------------------------------------------------------
divestiture agreement (which other agreements have not been fully
-----------------------------------------------------------------
performed).
---------
1. Letter of Intent, dated February 17, 2000, between AC
Communications Corp., Latin Radio of Washington, L.L.C., EXCL
Communications, Inc. and Latin Communications Group.
D. Employment, Consulting or Management Agreements (either written or, if
----------------------------------------------------------------------
oral, providing for over $100,000 in payments annually).
--------------------------------------------------------
1. Employment Agreement, dated November 30, 1995, by and between LCG
and Xxxxxx X. Xxxxx. This Agreement was modified by the Roll-In
Agreement, dated February 28, 1997, by and among LCG, Xxxxxx X.
Xxxxx and Xxxxxxxxxxx X. Xxxxx.
2. Option extension, dated May 6, 1999, between LCG and Xxxxxx X.
Xxxxx.
3. Option Agreement, dated May 10, 1999, between LCG and Xxxxxx
Xxxxxxx.
4. Employment Agreement, dated December 6, 1998, between EXCL Spanish
Network and Xxxxxxxxx Xxxxxx.
5. Employment Agreement, dated October 1, 1999, between EXCL Spanish
Network and Xxxxxxx Xxxxxxxx.
6. Employment Agreement, dated December 16, 1999, between EXCL
Spanish Network and Xxxxxxx Xxxxxx.
7. Compensation Plan, dated January 1, 1999, for Xxxx Xxxxxxxx.
8. Compensation Plan, dated February 6, 1999, for Xxx Xxxxxx.
9. Compensation Plan, dated January 7, 1999, for Xxx Xxxx.
10. Compensation Plan, dated January 15, 1999, for Xxxx Xxxxxx.
11. Compensation Plan, undated document, for Xxxxx Xxxxxxx.
J. Real Property Leases
--------------------
See, also, Schedule 3.5B and 3.11.
K. Contracts with Related Persons
------------------------------
See, Schedule (Contracts w/Related Person).
L. Material Agreements.
--------------------
1. Printing Agreement, dated March 12, 1996, by and between Abitibi-
Prince, Concept Press, Inc. and LCG.
2. Letter of Agreement, dated April 11, 1997, between El Diario and
Concept Press Inc. for the sale of newsprint.
3. Agreement and General Release, dated June 11, 1998, between Xxxxxx
Xxxxxx and El Diario - La Prensa.
4. Settlement Agreement, between KTNQ/KLVE, Inc. and EMI Sacramento
Radio, Inc. re: LA SUPER X dispute.
5. Agreement re: Easement, effective date September 1, 1997, between
Mt. Xxxxxx XX Broadcasters, Inc., and EXCL Communications, Inc.,
Sur Broadcasting, Inc. and LCG.
6. Agreement, dated January 27, 1999, by and among EXCL
Communications, Inc., SUR Broadcasting of New Mexico, Inc., Norte
Broadcasting of New Mexico, Inc. and Citadel Broadcasting Company
re: KRZY-AM Tower.
7. Settlement Agreement and Mutual Release, dated August 1999,
between EXCL Communications, Inc., SUR Broadcasting of Colorado,
Inc. and Western Cities Broadcasting, Inc.
8. Release and Settlement Agreement, dated January 29, 1999, by and
among LCG, EXCL Communications, Inc., N.W. Incentive Partners and
Lombard/Nogales Radio Partners, L.P.
9. Each of the radio stations has a Representation Agreement with
Interp.
10. Non-Competition Agreement by and between LCG and Xxxxxx X. Xxxxxx.
Schedule 3.9
------------
Media Licenses
See, Schedule 3.5A.
Schedule 3.10
-------------
Taxes and Assessments
Tax Audits
----------
1. On March 10, 1998, LCG received written notice from the Internal
Revenue Service that its 1996 Federal tax return had been assigned to
an agent for examination. LCG has provided requested information to the
agent and has not received any response since providing such
information.
2. On April 16, 1998, LCG received notice of an audit by the New York
State Department of Taxation and Finance in connection with LCG's New
York State Franchise Tax Returns (Forms CT3) filed for the years ended
December 31, 1995 and 1996. After the field work was completed, the New
York State Department of Taxation and Finance sent LCG an assessment
for $170,000. LCG's accountants are disputing this amount. Though there
have been no additional tax assessments, LCG's accountants advised LCG
that customarily local tax authorities file assessments after state tax
assessments have been made.
3. On May 21, 1998, Vea Acquisition Corporation received notice of a desk
audit by The City of New York Department of Finance of Vea's New York
City Tax Returns (Form NYC-3L) for the period ending December 31, 1996.
Vea responded to the document request, and on August 20, 1998, Vea
received notice from The City of New York Department of Finance that
based on the information submitted to the Department, the Department
had determined that no further action was necessary at that time.
4. EXCL received a notice of assessment with respect to personal property
taxes on its transmitter and other personal property for KRRE,
Sacramento, for taxes in the amount of approximately $5,000. In
addition, the landowner is seeking to pass through an increase in the
landowner's real estate taxes arising from the increased value of its
land due to the antenna site rental payments. This assessment totals
$17,854 per annum but the landowner's claim is being disputed by EXCL
and American Radio Systems (as the prior lessee). The applicable
document provides that the lessor is responsible for all real estate
taxes.
5. Vea Acquisition Corp. Inc. has been audited by the New York State
Department of Labor with respect to its payment of unemployment
insurance taxes for the period from March 1995 through February 1997.
Vea Acquisition Corp. Inc. is disputing the results of this audit. Vea
Acquisition Corporation has paid $4,000 under protest to settle the
matter.
Schedule 3.11
-------------
Material Litigation
A. Litigation
----------
1. The National Labor Relations Board (the "NLRB") issued a formal
complaint against LCG and the Guild alleging that former El Diario/ La
Prensa reporter Xxxxxx Xxxxxx was unlawfully terminated because of her
union activities, and that the Guild failed to adequately represent
her. A trial commenced in November 1996 before an NLRB administrative
law judge and continued in 1998. Xxxxxx also filed a charge with the
New York City Commission on Human Rights alleging discrimination based
on her sex. On June 11, 1998, the NLRB claim and the New York City
Commission on Human Rights claim were settled in connection with a
$75,000 payment from LCG and a $15,000 payment from the Guild. In
1999, Xxxxxx filed for arbitration under the settlement agreement with
El Diario/La Prensa claiming a violation of the "no disparagement"
clause and seeking $100,000 in damages. An arbitration hearing has not
yet been scheduled in the matter.
2. On July 17, 1997, correspondence was received from counsel for Xxxx
Xxxx, a former employee of Embarcadero Media, Inc., raising certain
issues arising under the Consolidated Omnibus Budget Reconciliation
Act of 1985. EMI responded on September 30, 1997 and, to date, nothing
further has been communicated. On October 30, 1997, a Notice of Claim
for Indemnity pursuant to Section 7.2.1 of the Stock Purchase
Agreement dated September 30, 1996, was served with respect to this
litigation upon Lombard/ Nogales Radio Partners, L.P. and N.W.
Incentive Partners, L.P. The claim notice was rejected on November 11,
1997.
3. In 1997, the Guild filed a request for arbitration over LCG's alleged
failure to properly pay 1994 wage increases to employees. A hearing in
that case is scheduled to resume January 19, 2000.
4. In April 1999, the Guild filed an arbitration claim alleging that
former employee, Xxxx Caracal, was improperly terminated in May 1997
and seeking her reinstatement and back pay. The case is still pending
in arbitration.
5. In early 1999, LCG received notice of an arbitration claim filed by
the Guild alleging management performance of work under Guild
jurisdiction. An arbitration hearing date has been scheduled for
January 13, 2000.
6. On November 7, 1990, El Diario Associates, L.P. was named as a
defendant in a civil action captioned Hayden Zambian v. El Diario
---------------------------
Associates d/b/a El Diario/ La Prensa and Xxxxx Xxxxxxxx, presently
--------------------------------------------------------
pending in the Supreme Court of the County of Queens, New York.
Plaintiff, representing herself pro se, seeks $1,000,000 for El
Diario's publication of one or more allegedly "defamatory,
libelous and prejudicial" articles and/ or letters-to-the-editor.
Neither discovery nor motion practice has begun.
7. On September 22, 1993, El Diario was served with a summons and notice
in an action entitled Xxxxxxxxx Xxxxxx, et al. v. El Diario Associates,
------------------------------------------------
et. al., Index No. 93121648. The summons and complaint named both El
------
Diario and El Diario reporter Xxxxxx Xxxxxxxxx Villa, and sought $20
million dollars for El Diario's publication of allegedly "false,
malicious and libelous" articles. On January 24, 1994, El Diario filed
an answer, denying all allegations of the complaint and asserting
affirmative defenses. Since the filing of the answer, LCG is unaware of
any steps taken by plaintiffs to pursue the litigation.
8. In November 1995, Xxxxxxxx Xxxxxx, president of the Dominican Chamber
of Commerce in New York, filed a complaint against LCG and others in
New York State Supreme Court, New York Court, alleging libel in
connection with the publication of an article in El Diario/ La Prensa
concerning alleged wrongful conduct by plaintiff in connection with the
selection for the offices of that entity. Plaintiff seeks $1,000,000,
including punitive damages. In November 1996, LCG sent a letter to the
plaintiff informing him that LCG planned to ask for a discontinuation
based on the frivolousness of the plaintiff's claim. The plaintiff's
counsel then made a motion to withdraw as counsel. LCG is unaware of
any other action taken since then by the plaintiff.
9. EXCL has recently learned of the existence of "La Tricolor" Hispanic
magazine in San Jose, CA and may send a cease and desist letter.
10. On August 19, 1999, EXCL Communications, Inc. filed a complaint against
Spanish Broadcasting System, Inc. and Xxxxxxxxx Xxxxxx alleging False
Designation of Origin/Affiliation, Service Xxxx Infringement, Trademark
Dilution, Unfair Trade Practices and Common Law Unfair Competition.
This complaint stems from defendants' alleged use of EXCL's
MEXICANISIMA xxxx and XXXX XXXX name. On October 4, 1999, Spanish
Broadcasting System, Inc. filed a counterclaim alleging that EXCL
Communications, Inc. misappropriated the use of the "Xxxx Xxxx"
character established by one of its radio personalities.
11. EXCL Communications, Inc. was served with a Civil Investigative Demand
by the Department of Justice on October 22, 1996 in respect of an
investigation of Citadel Communications' acquisition of certain assets
of Crescent Communications. Department of Justice counsel has advised
LCG that neither EXCL Communications, Inc. nor LCG is a target of the
investigation.
12. On or about March 18, 1998, EXCL Communications, Inc./KBRG received a
letter from counsel for Heftel Broadcasting's KSOL-FM stations in San
Francisco, asserting the existence of claims of tortious interference
with contract and economic advantage and conversion arising from the
alleged destruction of KSOL promotional materials by EXCL
Communications, Inc. employees. No further action has been taken.
13. In June 1998, EXCL Communications, Inc. received a subpoena for
documents in connection with a grand jury payola investigation, and in
July 1998, LCG complied with the subpoena.
14. Potential claims may exist against and on behalf of EXCL
Communications, Inc. in connection with an easement that it purchased
from Mount Xxxxxx Broadcasting, Inc. for access to a radio tower in the
Xxxxxxx area. The access road, which was on the easement at the time of
purchase, was allegedly not in compliance with regulations and washed
out during a rain storm. Various neighbors have indicated that they
have lost access due to the flooding, although it is not yet clear
whether they are asserting any claim against EXCL Communications, Inc.
or Mount Xxxxxx Broadcasting, Inc. EXCL Communications, Inc. may have
an indemnity claim against Mount Xxxxxx with respect to these claims.
EXCL Communications, Inc. has entered into a settlement agreement with
Mt. Xxxxxx providing alternate access to the transmitter and preserving
EXCL's indemnity claims.
15. LCG's landlord, The Xxxxxx, Churchwardens and Vestrymen of Trinity
Church in the City of New York ("Trinity Church") filed a third-party
claim against LCG d/b/a El Diario / La Prensa demanding indemnification
in connection with a lawsuit filed against it by El Diario / La Prensa
employee Xxxx Xxxxxxxx. The plaintiff seeks $500,000 in damages for
personal injuries arising from a fall in an internal staircase in LCG's
building. On April 29,1999, Trinity Church filed a stipulation of
discontinuance discontinuing its third-party action against LCG.
16. EXCL Communications, Inc. is currently involved in a dispute with
Citadel Broadcasting with respect to ownership of the KRZY tower in
Albuquerque, New Mexico. In May 1996, EXCL assumed the lease for the
property on which the tower is located pursuant to an Assignment and
Assumption Agreement by and between EXCL and Citadel. The parties
reached an agreement acknowledging EXCL's uncontested right to
ownership of the tower. Pursuant to the agreement, EXCL provided a
sublicense of the tower with a credit against sublease rentals.
17. The owner of the land where the KRRE antenna is located is seeking to
pass through an increase in the landowner's real estate taxes arising
from the increased value of its land due to the antenna site rental
payments. This assessment totals $17,854 per annum but the landowner's
claim is being disputed by EXCL Communications, Inc. and American Radio
Systems (as the prior lessee). The applicable document provides that
the lessor is responsible for all real estate taxes.
See, also Schedule 3.10
B. Other Matters
-------------
1. Facilities for an auxiliary antenna for use by Station KLOK-FM were
constructed by the prior Licensee and are available for use. However,
no application for a license to cover the construction permit was filed
and the permit has expired. The
permit needs to be reinstated and a license application filed in order
to regularize the operation of the facility.
See, also Schedule 3.10.
Schedule 3.18
-------------
Fees and Commissions
None.
Schedule 3.19
-------------
Publications
See, Schedule 3.5A.
Schedule 3.21
-------------
Pending FCC Matters
None.
Schedule 6.2
------------
Permitted Indebtedness
None.
Schedule 6.7
------------
Permitted Additional Investments
None.
