EXHIBIT 99.3
Foothill Partners II, L.P.
Foothill Partners III, L.P.
00000 Xxxxx Xxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Gentlemen:
This letter will confirm the agreement of Children's Broadcasting
Corporation (the "Borrower") and its undersigned subsidiaries (the "Guarantors";
the Guarantors and Borrower shall be referred to individually and collectively,
jointly and severally, as the "Company") that Foothill Partners II, L.P. and
Foothill Partners III, L.P. (the "Funds"), in connection with its acquisition of
debt of the Company, will be entitled to the following contractual rights, in
addition to rights to certain non-public financial information, inspection
rights and other rights specifically provided to all lenders under that certain
Amended and Restated Loan and Security Agreement, dated July 1, 1997, between
Foothill Capital Corporation and the Borrower, as amended by that certain
Amendment Number One to Amended and Restated Loan and Security Agreement, dated
September 24, 1997, between Foothill Capital Corporation and the Borrower (as
further amended, restated, supplemented, or otherwise modified from time to
time, the "Loan Agreement"):
(1) The Funds shall be permitted to select one representative
("Representative") to consult with and advise management of the Company on
significant business issues, including management's proposed annual operating
plans, and management will make itself available to meet with that
Representative regularly during each year by telephone and/or at the Company's
facilities at mutually agreeable times, on reasonable prior written notice, for
such consultation and advice and to review progress in achieving such plans.
(2) In the event of any material development to or affecting the Company's
business, the Company shall notify the Representative and provide the
Representative with the opportunity, on reasonable prior written notice, to
consult with and advise management of its views with respect thereto.
(3) The Representative may examine the books and records of the Company
and visit and inspect its facilities and may reasonably request information at
reasonable times and intervals concerning the general status of the Company's
financial condition and operations.
(4) On reasonable prior written notice, the Representative may discuss the
business operations, properties and financial and other condition of the Company
with the Company's officers, employees and directors and with the Company's
independent certified accountants and investment bankers.
(Page 21 of 57 Pages)
(5) The Funds shall be entitled to request that the Company provide it
when available, with copies of (i) all financial statements, forecasts and
projections provided to or approved by its Board of Directors; (ii) all notices,
minutes, proxy materials, consents and correspondence and other material that it
provides to its Directors and shareholders; (iii) any letter issued to the
Company by its accountants with respect to the Company's internal controls; (iv)
any documents filed by the Company with the Securities and Exchange Commission;
(v) copies of all information, statements and reports provided to any Agent
under the Loan Agreement; and/or (vi) such other business and financial data as
the Representative may reasonably request in writing from time to time.
The Funds agree that they will not disclose to any third party any
information provided to the Funds by the Company hereunder which is not
generally available to the public or which is specifically designated by the
Company as confidential, except with the prior express approval of the Company
or as may otherwise by required by applicable law.
The rights described herein shall apply and continue for so long as the
Funds continue to hold an amount of indebtedness of the Company equal to at
least 25% of the indebtedness of the Company owned by the Funds on the date
hereof; provided that such indebtedness shall be deemed to remain outstanding
notwithstanding an exchange by the Company of such indebtedness for other
indebtedness or securities unless such exchange is in connection with a public
offering of the Company's securities or a merger or reorganization of the
Company.
Very truly yours,
CHILDREN'S BROADCASTING
CORPORATION, a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF LOS ANGELES, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
(Page 22 of 57 Pages)
CHILDREN'S RADIO OF NEW YORK, INC.,
a New Jersey corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF MINNEAPOLIS, INC.,a
Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF GOLDEN VALLEY, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF MILWAUKEE, INC., a
Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF DENVER, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
(Page 23 of 57 Pages)
CHILDREN'S RADIO OF KANSAS CITY, INC., a
Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF DALLAS, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF HOUSTON, INC., a
Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF PHILADELPHIA, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF DETROIT, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
(Page 24 of 57 Pages)
CHILDREN'S RADIO OF CHICAGO, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
CHILDREN'S RADIO OF PHOENIX, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
WWTC-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
KYCR-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
WZER-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
(Page 25 of 57 Pages)
KKYD-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
KCNW-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
KAHZ-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
KTEK-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
WPWA-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
(Page 26 of 57 Pages)
WCAR-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
WJDM-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
KPLS-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
WAUR-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
KIDR-AM, INC.,
a Minnesota corporation
By: /s/ Xxxxxxxxxxx X. Xxxx
-----------------------------------
Title: Chief Executive Officer
--------------------------------
(Page 27 of 57 Pages)
AGREED AND ACCEPTED THIS
25th DAY OF SEPTEMBER, 1997.
FOOTHILL PARTNERS II, L.P.
By: /s/ Xxxxx Xxxxxxxxx
-----------------------------------------
Managing General Partner
FOOTHILL PARTNERS III, L.P.
By: /s/ Xxxxx Xxxxxxxxx
-----------------------------------------
Managing General Partner
(Page 28 of 57 Pages)
