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EXHIBIT 10.09
EXECUTION COPY
LOAN AGREEMENT
by and among
ENTERTAINMENT COMMUNICATIONS, INC.,
as the Borrower,
KEY CORPORATE CAPITAL INC.,
as Administrative Agent and Documentation Agent,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Syndication Agent,
and
THE FINANCIAL INSTITUTIONS LISTED HEREIN
AS OF FEBRUARY 13, 1998
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TABLE OF CONTENTS
SECTION 1 DEFINITIONS.....................................................................................1
1.1 Definitions................................................................................1
1.2 Other Terms...............................................................................19
1.3 Accounting Provisions.....................................................................19
SECTION 2 THE LOANS......................................................................................20
2.1 The Commitment and the Loans..............................................................20
2.2 Letters of Credit.........................................................................21
2.3 Making and Continuation/Conversion of the Loans...........................................26
2.4 The Notes.................................................................................27
2.5 Fees......................................................................................27
2.6 Prepayment................................................................................28
2.7 Reserves or Deposit Requirements, Etc.....................................................32
2.8 Tax Law, Increased Costs, Etc.............................................................32
2.9 Eurodollar Deposits Unavailable or Interest Rate
Unascertainable................................................................................33
2.10 Changes in Law Rendering LIBOR Loans Unlawful............................................33
2.11 Funding..................................................................................33
2.12 Indemnity................................................................................33
2.13 Capital Adequacy.........................................................................34
2.14 Taxes....................................................................................34
2.15 Incremental Commitment...................................................................36
SECTION 3 INTEREST; PAYMENTS.............................................................................36
3.1 Interest..................................................................................36
3.2 Manner of Payments........................................................................37
SECTION 4 CLOSING........................................................................................38
SECTION 5 REPRESENTATIONS AND WARRANTIES OF THE BORROWER.................................................38
5.1 Organization and Powers...................................................................39
5.2 Authorization.............................................................................39
5.3 Financial Statements......................................................................40
5.4 Projections...............................................................................40
5.5 Capitalization of the Borrower and its
Subsidiaries...................................................................................40
5.6 Title to Properties; Patents, Trademarks, Etc.............................................41
5.7 Litigation; Proceedings...................................................................41
5.8 Taxes.....................................................................................41
5.9 Absence of Conflicts......................................................................42
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5.10 Indebtedness.............................................................................42
5.11 Compliance...............................................................................43
5.12 Statements Not Misleading................................................................43
5.13 Consents or Approvals....................................................................44
5.14 Material Contracts and Commitments.......................................................44
5.15 Employee Benefit Plans...................................................................45
5.16 Licenses and Operating Agreements........................................................45
5.17 Material Restrictions....................................................................46
5.18 Investment Company Act...................................................................46
5.19 Absence of Material Adverse Effect.......................................................46
5.20 Defaults.................................................................................46
5.21 Real Estate..............................................................................46
5.22 Securities Laws..........................................................................46
5.23 Insurance................................................................................46
5.24 Labor Matters............................................................................47
5.25 Environmental Compliance.................................................................47
5.26 Solvency.................................................................................49
5.27 Subordinated Purchase Agreement..........................................................50
SECTION 6 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE BANKS...............................................50
6.1 Compliance................................................................................50
6.2 Security Agreements.......................................................................51
6.3 Pledge Agreements.........................................................................51
6.4 Financing Statements......................................................................52
6.5 Subsidiary Guaranty.......................................................................52
6.6 Opinion of Borrower's Counsel.............................................................52
6.7 Consummation of Acquisition Agreements....................................................52
6.8 Financial Information.....................................................................52
6.9 Borrowing Request.........................................................................53
6.10 Insurance Certificates...................................................................53
6.11 Corporate and Partnership Documents......................................................54
6.12 Lien Searches, Consents and Releases of Liens............................................54
6.13 No Order, Judgment or Decree.............................................................54
6.14 No Material Adverse Effect...............................................................54
6.15 Fee Letters..............................................................................54
6.16 Legal Approval...........................................................................55
6.17 Other Documents..........................................................................55
SECTION 7 AFFIRMATIVE COVENANTS OF THE BORROWER..........................................................55
7.1 Use of Proceeds...........................................................................55
7.2 Continued Existence; Maintenance of Rights and
Licenses; Compliance with Law..................................................................55
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7.3 Insurance.................................................................................55
7.4 Obligations and Taxes.....................................................................56
7.5 Financial Statements and Reports..........................................................57
7.6 Notices...................................................................................59
7.7 Maintenance of Property...................................................................60
7.8 Information and Inspection................................................................60
7.9 Maintenance of Liens......................................................................60
7.10 Title To Property........................................................................61
7.11 Environmental Compliance and Indemnity...................................................61
7.12 Rate Hedging Obligations.................................................................63
7.13 FCC Consents.............................................................................63
SECTION 8 NEGATIVE COVENANTS OF THE BORROWER....................................................64
8.1 Indebtedness. ...........................................................................64
8.2 Liens.....................................................................................65
8.3 Guaranties................................................................................65
8.4 Rental and Conditional Sale Obligations...................................................66
8.5 Real Property Interests...................................................................66
8.6 Capitalized Lease Obligations.............................................................66
8.7 Capital Expenditures......................................................................66
8.8 Notes, Accounts Receivable and Claims.....................................................66
8.9 Capital Distributions; Restrictions on Payments to
Stockholders..............................................................................67
8.10 Disposal of Property; Mergers; Acquisitions;
Reorganizations..........................................................................68
8.11 Investments..............................................................................72
8.12 Amendment of Governing Documents.........................................................73
8.13 Financial Covenants......................................................................73
8.14 Management Agreements and Fees...........................................................75
8.15 Fiscal Year..............................................................................75
8.16 ERISA....................................................................................75
8.17 Affiliates...............................................................................75
8.18 Change of Name, Identity or Structure....................................................76
8.19 Amendments or Waivers....................................................................76
8.20 Issuance or Transfer of Capital Stock....................................................76
8.21 Change in Business.......................................................................76
8.22 Regulation U.............................................................................76
8.23 License Subsidiaries.....................................................................77
8.24 Subordinated Debt........................................................................77
SECTION 9 EVENTS OF DEFAULT..............................................................................78
9.1 Non-Payment...............................................................................78
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9.2 Failure of Performance in Respect of Other
Obligations...............................................................................78
9.3 Breach of Warranty........................................................................78
9.4 Cross-Defaults............................................................................78
9.5 Assignment for Benefit of Creditors.......................................................79
9.6 Bankruptcy................................................................................79
9.7 Appointment of Receiver; Liquidation......................................................79
9.8 Judgments.................................................................................79
9.9 Impairment of Collateral; Invalidation of any Loan
Document..................................................................................79
9.10 Termination of License or Operating Agreement............................................80
9.11 Change of Control........................................................................81
9.12 Condemnation.............................................................................81
9.13 Cessation of Operations..................................................................81
9.14 Subordination............................................................................81
9.15 Material Adverse Effect..................................................................81
SECTION 10 REMEDIES.......................................................................................82
10.1 Optional Defaults........................................................................82
10.2 Automatic Defaults.......................................................................82
10.3 Performance by the Banks.................................................................83
10.4 Other Remedies...........................................................................83
10.5 Enforcement and Waiver by the Banks......................................................83
SECTION 11 THE ADMINISTRATIVE AGENT.......................................................................83
11.1 Appointment..............................................................................83
11.2 Powers...................................................................................84
11.3 General Immunity.........................................................................84
11.4 Action on Instructions of the Banks......................................................84
11.5 Employment of Agents and Counsel.........................................................85
11.6 Reliance on Documents; Counsel...........................................................85
11.7 Administrative Agent's Reimbursement and
Indemnification..........................................................................85
11.8 Rights as a Bank.........................................................................85
11.9 Bank Credit Decision.....................................................................86
11.10 Successor Administrative Agent..........................................................86
11.11 Ratable Sharing.........................................................................87
11.12 Actions by the Administrative Agent and the
Banks...................................................................................87
SECTION 12 MISCELLANEOUS..................................................................................88
12.1 Construction.............................................................................88
12.2 Further Assurance........................................................................88
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12.3 Expenses of the Administrative Agent and the
Banks; Indemnification...................................................................88
12.4 Notices..................................................................................90
12.5 Waiver and Release by the Borrower. .....................................................91
12.6 Right of Set Off.........................................................................91
12.7 Successors and Assigns; Participations...................................................92
12.8 Applicable Law...........................................................................94
12.9 Binding Effect and Entire Agreement......................................................94
12.10 Counterparts............................................................................94
12.11 Survival of Agreements..................................................................94
12.12 Modification............................................................................94
12.13 Separability............................................................................95
12.14 Section Headings........................................................................95
12.15 Enforcement.............................................................................95
12.16 Termination.............................................................................96
12.17 FCC Compliance..........................................................................96
12.18 Jury Trial Waiver.......................................................................97
12.19 Sale as a Going Concern.................................................................98
12.20 Marshaling; Payments Set Aside..........................................................98
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LOAN AGREEMENT
THIS LOAN AGREEMENT is made and entered into as of February 13, 1998,
by and among ENTERTAINMENT COMMUNICATIONS, INC., a Pennsylvania corporation (the
"Borrower"), the BANKS (as that term is defined below), KEY CORPORATE CAPITAL
INC., as documentation agent and administrative agent (the "Administrative
Agent"), and BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as
syndication agent (the "Syndication Agent").
R E C I T A L S:
The Borrower desires to borrow from the Banks up to $300,000,000
(subject to increase under certain circumstances up to $350,000,000) on a
reducing revolving credit basis, the proceeds of which will be used to refinance
amounts outstanding under the Loan Agreement dated as of August 1, 1996, as
amended, among the Borrower, KeyBank National Association, as agent, and the
financial institutions which are a party thereto, to fund certain acquisitions
and for capital expenditures and working capital purposes in the operations of
the Borrower.
A G R E E M E N T S:
Accordingly, the Borrower, the Banks, the Administrative Agent and the
Syndication Agent agree as follows:
SECTION 1 DEFINITIONS.
1.1 Definitions. All terms typed with leading capitals are terms
defined in this Agreement. For the purposes of this Agreement, the terms defined
in this Section 1 shall have the meanings set out below.
"Acquisition Agreements" means the Armak Purchase Agreement, the ARS
Purchase Agreement, the Capital Broadcasting Purchase Agreement, the Gator
Purchase Agreement and the Xxxxxxxx Purchase Agreement and any other purchase or
exchange agreement pursuant
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to which the Borrower or any of its Subsidiaries is to acquire a Station
pursuant to a Permitted Acquisition.
"Acquisition Capital Expenditures" means Capital Expenditures incurred
by the Borrower or any of its Subsidiaries with respect to a radio station which
are incurred within twelve months following the acquisition of such radio
station.
"Affiliate" means, with respect to any Person (a) any other Person
which is directly or indirectly controlled by, under common control with or
controlling the first specified Person; (b) a Person owning beneficially or
controlling 10% or more of the equity interest in such other Person; (c) any
officer, director or partner of such other Person; or (d) any spouse or relative
(by blood, adoption or marriage) of any such individual Person. The term
"control" means possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of a Person whether through
the ownership of voting securities, partnership interests, by contract or
otherwise.
"Agents" means the Administrative Agent and the Syndication
Agent.
"Applicable Margin" means, as of any date of determination, the
percentage determined from the following table based upon the Leverage Ratio:
Leverage Ratio: Applicable Margin Applicable Margin
for Base Rate for LIBOR Loans:
Loans:
Greater than 0.875% 2.125%
6.50:1.0 but less
than or equal to
7.00:1.0:
Greater than 0.625% 1.875%
6.00:1.0 but less
than or equal to
6.50:1.0:
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Greater than 0.250% 1.500%
5.50:1.0 but less
than or equal to
6.00:1.0:
Greater than 0.000% 1.250%
5.00:1.0 but less
than or equal to
5.50:1.0:
Greater than 0.000% 1.125%
4.50:1.0 but less
than or equal to
5.00:1.0:
Greater than 0.000% 1.000%
4.00:1.0 but less
than or equal to
4:50:1.0:
Greater than 0.000% 0.750%
3.50:1.0 but less
than or equal to
4.00:1.0:
Less than or equal 0.000% 0.500%
to 3.50:1.0:
"Armak Purchase Agreement" means the Asset Purchase Agreement, dated
January 23, 1998, between Armak Broadcasters, Inc. and the Borrower pursuant to
which the Borrower is to acquire substantially all of the assets relating to
radio stations KRQT, Castle Rock, Washington and KBAM, Longview, Washington for
a purchase price of approximately $1,000,000.
"ARS Purchase Agreement" means the Letter Agreement, dated November 24,
1997, among American Radio Systems Corporation ("ARS"), the License Partnership
and the Borrower pursuant to which the License Partnership and the Borrower will
exchange the FCC Licenses of KRXQ, Roseville, California, plus $4,500,000 in
cash for the FCC Licenses of KRAK, Sacramento, California, plus certain
intellectual property relating to KSSJ and also pursuant
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to which ARS will purchase from the Borrower the KRXQ transmitter site for
$750,000 in cash.
"Asset Sale" means the sale, exchange, transfer or other disposition by
the Borrower or any of its Subsidiaries to any Person of any of the stock,
partnership interests or other equity interests of any Subsidiary or any other
assets of the Borrower or any Subsidiary, other than (a) the sale of assets in
one transaction or a series of transactions with an aggregate value which does
not exceed in any fiscal year an amount equal to $2,000,000; (b) the sale in the
ordinary course of business of assets held for resale in the ordinary course of
business or the trade in or replacement of assets in the ordinary course of
business; and (c) the sale, exchange, transfer or other disposition from the
Borrower to a wholly owned Subsidiary or from one wholly owned Subsidiary to
another wholly owned Subsidiary.
"Banking Day" means a day on which the main office of the
Administrative Agent is open to the public for the transaction of business, and
on which, with respect to any LIBOR Loan, banks are open for business in London,
England, and quoting deposit rates for dollar deposits.
"Banks" means the financial institutions listed on the signature pages
of this Agreement and their respective successors and assigns; the term "Banks"
shall include the Issuing Bank.
"Base Rate" means the rate of interest determined and publicly
announced by KeyBank from time to time as its prime rate at its main office in
Cleveland, Ohio. The prime rate functions as a reference rate index, and KeyBank
may charge borrowers more or less than the prime rate. The Base Rate will
automatically change as and when such prime rate changes.
"Base Rate Loans" means those Loans described in Section 2.1 on which
the Borrower shall pay interest at a rate based on the Base Rate.
"Benefit Arrangement" means any pension, profit-sharing, thrift, or
other retirement plan, medical, hospitalization, vision, dental, life,
disability or other insurance or benefit plan, deferred compensation, stock
ownership, stock purchase,
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stock option, performance share, bonus, fringe benefit, savings or other
incentive plan, severance plan or other similar plan, agreement, arrangement or
understanding, to which the Borrower or any member of the Controlled Group is,
or in the preceding six years was, required to contribute on behalf of its
employees or directors, whether or not such plan, agreement, arrangement or
understanding is subject to ERISA.
"Borrower Pledge Agreement" has the meaning assigned to it in Section
6.3(a).
"Borrower Security Agreement" has the meaning assigned to it in Section
6.2.
"Broadcast Cash Flow" for any period means Operating Cash Flow for such
period plus the aggregate administrative, legal, accounting, management and
overhead expenses attributable to the corporate management of the Borrower for
such period.
"Capital Broadcasting Purchase Agreement" means the Asset Purchase
Agreement, dated September 18, 1997, between Capital Broadcasting, Inc. and the
Borrower pursuant to which the Borrower will acquire substantially all of the
assets relating to the communications tower business operating at 2800 Xxxxxxx,
Kansas City, Missouri for a purchase price of approximately $2,100,000.
"Capital Distribution" means any payment or distribution made,
liability incurred or other consideration given for the purchase, acquisition,
redemption or retirement of any stock, partnership interest or other equity
interest of the Borrower or any of its Subsidiaries or as a dividend, return of
capital or other payment or distribution of any kind to a shareholder or partner
of the Borrower or any of its Subsidiaries in respect of the Borrower's or such
Subsidiary's stock or partnership interests.
"Capital Expenditures" means any payments by a Person for or in
connection with the rental, lease, purchase, construction or use of any real or
personal property the value or cost of which, under GAAP, should be capitalized
and appear on such Person's balance sheets in the category of property, plant or
equipment, without regard to the manner in which such payments or the
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instrument pursuant to which they are made are characterized by such Person or
any other Person; provided, however, that neither (a) the capitalized portion of
the purchase price payable in connection with a Permitted Acquisition, nor (b)
expenditures of proceeds of casualty insurance policies reasonably and promptly
applied to replace insured assets, shall constitute a Capital Expenditure for
purposes of this Agreement.
"Capitalized Lease Obligations" means, as to any Person, the
obligations of such Person to pay rent or other amounts under leases of, or
other agreements conveying the right to use real or personal property, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person, prepared in accordance with GAAP.
"Closing" and "Closing Date" have the meanings assigned to them in
Section 4.
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor statute thereto.
"Collateral Documents" means all promissory notes, letters of credit,
agreements, assignments, guaranties, mortgages, financing statements,
certificates and other instruments and documents which are required by this
Agreement or any other Collateral Document to be executed or delivered by or on
behalf of the Borrower, any of its Subsidiaries or any other Person.
"Commitment" has the meaning assigned to it in Section 2.1(a).
"Controlled Group" means a controlled group of entities which are
treated as a single employer under Sections 414(b), 414(c) or 414(m) of the Code
of which the Borrower or any of its Subsidiaries is a part.
"Default Interest Rate" means a rate of interest equal to the sum of
the Base Rate plus the Applicable Margin plus 2.00% per annum.
"Discount Rate" means, with respect to a prepayment or conversion of a
LIBOR Loan on a date other than the last day of its Interest Period, a rate
equal to the interest rate (as of the
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date of prepayment) on United States Treasury obligations in a like amount as
such Loan and with a maturity approximately equal to the period between the
prepayment or conversion date and the last day of the Interest Period of such
Loan, as determined by the Administrative Agent.
"Distributions to Pay Tax Liabilities" means Capital Distributions to a
shareholder of the Borrower to enable such shareholder to pay his Tax Liability
for any tax year.
"Environmental Claim" means, with respect to any Person, any written or
oral notice, claim, demand, request for information, citation, summons, order or
other communication (each, a "claim") by any other Person alleging or asserting
the liability of the recipient of such claim for investigatory costs, cleanup
costs, governmental response costs, damages to natural resources or other
property or health, personal injuries, fines or penalties arising out of, based
on or resulting from (a) the presence, or Release, of any Hazardous Material at
or from any location, whether or not owned by such Person, or (b) circumstances
forming the basis of any violation, or alleged violation, of any Environmental
Law. The term "Environmental Claim" shall include, without limitation, any claim
by any governmental authority for enforcement, cleanup, removal, response,
remedial or other actions or damages pursuant to any applicable Environmental
Law, and any claim by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting from
the presence or Release of Hazardous Materials or arising from alleged injury or
threat of injury to health, safety or the environment.
"Environmental Laws" means all provisions of law, statutes, ordinances,
rules, regulations, permits, licenses, judgments, writs, injunctions, decrees,
orders, awards and standards promulgated by the government of the United States
of America or by any state or municipality thereof or by any court, agency,
instrumentality, regulatory authority or commission of any of the foregoing
concerning health, safety and protection of, or regulation of the emission,
release or discharge of substances into, the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the regulations thereunder.
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"Event of Default" means any of the events specified in Section 9.
"Excess Cash Flow" for any fiscal year of the Borrower means Operating
Cash Flow for such fiscal year, minus the sum of the following without
duplication: (a) all actual cash principal payments required to be made as a
result of scheduled Commitment reductions on the Loans pursuant to Sections 2.1
and 2.6(b)(i) during such fiscal year, plus (b) all principal payments required
to be made by the Borrower and its Subsidiaries on Total Debt (other than the
Loans) during such fiscal year, plus (c) all Interest Expense of the Borrower
and its Subsidiaries incurred during such fiscal year, plus (d) Capital
Expenditures paid or incurred by the Borrower and its Subsidiaries during such
fiscal year, plus (e) federal, state and local income taxes incurred during such
fiscal year and Distributions to Pay Tax Liabilities made during such fiscal
year and to be made after such fiscal year with respect to income of the
Borrower for such fiscal year, plus (f) the increase, if any, in Working Capital
as of the end of such fiscal year over Working Capital as of the end of the
prior fiscal year, plus (g) $1,000,000.
"FCC" means the Federal Communications Commission or any governmental
authority at any time substituted therefor.
"Fee Letters" means collectively the letter agreement dated December
26, 1997, among the Borrower, the Agents and BancAmerica Xxxxxxxxx Xxxxxxxx, and
the letter agreement dated December 26, 1997, between the Borrower and the
Administrative Agent.
"Field Family" means (a) Xxxxxx X. Field, Xxxxx X. Field, Xxxxx X.
Field and Xxxxx X. Field and any of their respective spouses, (b) any other
relative or spouse of any relative of Xxxxxx X. Field who, directly or
indirectly, holds any of the Borrower's Common Stock (or beneficial interest
therein) or rights to acquire any such Common Stock and (c) any trust which
holds any of the Borrower's Common Stock or rights to acquire any such Common
Stock for the benefit of any Person identified in clause (a) or (b) of this
definition.
"Final Order" means an action or order issued by the FCC (a) which has
not been reversed, stayed, enjoined, set aside, annulled or suspended, and (b)
with respect to which (i) no
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requests or petitions have been filed for administrative or judicial review,
reconsideration, rehearing, appeal or stay, and the time for filing any such
requests or petitions and for the FCC to set aside the action on its own motion
has expired, (ii) in the event of review, reconsideration or appeal, the time
for further review, reconsideration or appeal has expired, and (iii) no appeal
to a court or request for stay by a court of such action is pending or in
effect, and, if any deadline for filing any such appeal or request is designated
by statute or rule, it has passed.
"Fixed Charge Coverage Ratio" means, as of the end of any quarter, the
ratio of Operating Cash Flow for the four quarter period then ended to the sum
of (a) all Projected Debt Service as of the end of such quarter, plus (b)
Capital Expenditures (other than Acquisition Capital Expenditures and Project
Capital Expenditures) incurred by the Borrower and its Subsidiaries in such four
quarter period, plus (c) any federal, state or local income taxes incurred by
the Borrower or any of its Subsidiaries during such four quarter period, plus
(d) any Capital Distributions (including, without limitation, Distributions to
Pay Tax Liabilities) made by the Borrower in such four quarter period.
"GAAP" means generally accepted accounting principles in effect from
time to time in the United States, consistently applied.
"Gator Purchase Agreement" means the Asset Purchase Agreement, dated
January 23, 1998 between Gator Broadcasting Corporation and the Borrower
pursuant to which the Borrower is to acquire substantially all of the assets
relating to radio station WRRX, Micanopy, Florida for a purchase price of
approximately $2,000,000, plus $850,000 and expenses (not to exceed $150,000)
relating to the upgrade of WRRX to a Class C-2 Station in the event the FCC
licenses such upgrade by Final Order.
"Guarantor" means one who pledges its credit or property in any manner,
or otherwise becomes responsible for the payment or other performance of the
indebtedness, contract or other obligation of another Person and includes
(without limitation) any guarantor (whether of payment or of collection),
surety, co-maker, endorser or one who agrees conditionally or otherwise
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to make any purchase, loan or investment in order thereby to enable another to
prevent or correct a default of any kind and one who has endorsed (otherwise
than for collection or deposit in the ordinary course of business), or has
discounted with recourse or agreed (contingently or otherwise) to purchase or
repurchase or otherwise acquire or become liable for, any Indebtedness.
"Guaranty" shall have the meaning assigned to it in Section 6.5.
"Hazardous Material" means, collectively, (a) any petroleum or
petroleum products, flammable materials, explosives, radioactive materials,
asbestos, urea formaldehyde foam insulation, and transformers or other equipment
that contain polychlorinated biphenyls ("PCBs"), (b) any chemicals or other
materials or substances that are now or hereafter become defined as or included
in the definition of "hazardous substances", "hazardous wastes", "hazardous
materials", "extremely hazardous wastes", "restricted hazardous wastes", "toxic
substances", "toxic pollutants", "contaminants", "pollutants" or words of
similar import under any Environmental Law and (c) any other chemical or other
material or substance, exposure to which is now or hereafter prohibited, limited
or regulated under any Environmental Law.
"Indebtedness" of any Person means, without duplication, all
liabilities, obligations and reserves, contingent or otherwise, which, in
accordance with GAAP, would be reflected as a liability on a balance sheet
(excluding trade accounts payable and accrued expenses arising in the ordinary
course of business), and (without duplication) (a) all obligations of such
Person for borrowed money or with respect to deposits or advances of any kind,
(b) all obligations of such Person evidenced by bonds, debentures, notes or
similar instruments, (c) all obligations of such Person upon which interest
charges are customarily paid, (d) all obligations of such Person under
conditional sale or other title retention agreements relating to assets
purchased by such Person, (e) all obligations of such Person issued or assumed
as the deferred purchase price of property or services, (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the obligations secured thereby have
been
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assumed by such Person, (g) all obligations or liabilities in respect of which
such Person is a Guarantor, (h) all Capitalized Lease Obligations of such
Person, (i) all Rate Hedging Obligations, and (j) all obligations of such Person
as an account party to reimburse any Person in respect of letters of credit
(including the Letters of Credit) or bankers' acceptances. The Indebtedness of
any Person shall include any recourse Indebtedness of any partnership in which
such Person is a general partner.
"Interest Expense" shall mean, for any period, the gross interest
expense incurred by the Borrower and its Subsidiaries in respect of their
Indebtedness for such period (other than interest incurred on the Indebtedness
under the Subordinated Purchase Agreement), determined on a consolidated basis,
all fees payable under Section 2.5 or the Fee Letters (other than any one time
closing fees) and any other fees, charges, commissions and discounts in respect
of Indebtedness, including fees payable in connection with the Letters of
Credit. For purposes of the foregoing, net payments made or received by the
Borrower with respect to Rate Hedging Obligations shall be included in the
computation of gross interest expense.
"Interest Period" means, with respect to any LIBOR Loan, the period
selected by the Borrower, commencing on the date such Loan is made, continued or
converted and ending on the last day of such period as selected by the Borrower.
The Interest Period for each LIBOR Loan shall be one, two, three or six months;
provided, however, that whenever the last day of such Interest Period would
otherwise occur on a day other than a Banking Day, the last day of such Interest
Period shall occur on the next succeeding Banking Day; provided, further, that
if such extension of time would cause the last day of such Interest Period to
occur in the next calendar month, the last day of such Interest Period shall
occur on the next preceding Banking Day. The Borrower shall not select any
Interest Period which extends beyond any date on which a scheduled payment is or
may be required to be made pursuant to Sections 2.1 or 2.6(b)(i) unless the sum
of the amount available to be drawn under the Commitment plus the aggregate
principal balance of all Base Rate Loans and all LIBOR Loans with Interest
Periods ending prior to such date is at least equal to the maximum amount that
is, or may be, required to be paid on such date.
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18
"Issuing Bank" means KCCI in its capacity as the issuer of the Letters
of Credit, or any successor issuer of the Letters of Credit.
"KCCI" means Key Corporate Capital Inc., a Michigan corporation.
"KeyBank" means KeyBank National Association.
"Letters of Credit" has the meaning assigned to it in Section 2.2.
"Leverage Ratio", as of any date, means the ratio of Total Debt as of
such date to Operating Cash Flow for the four quarter period then ended or most
recently ended.
"LIBOR" means the average (rounded upwards, if necessary, to the
nearest 1/16th of 1%) of the per annum rates at which deposits in immediately
available funds in United States dollars for the relevant Interest Period and in
an amount approximately equal to the Loan to be disbursed or to remain
outstanding during such Interest Period, as the case may be, are offered to the
Administrative Agent by leading banks in the London Eurodollar market,
determined as of 11:00 a.m. London time (or as soon thereafter as practicable),
two Banking Days prior to the beginning of the relevant Interest Period.
"LIBOR Loans" means those Loans described in Section 2.1 on which the
Borrower shall pay interest at a rate based on the applicable LIBOR Rate.
"LIBOR Rate" means a rate per annum equal to the quotient obtained
(rounded upwards, if necessary, to the nearest 1/100th of 1%) by dividing (a)
the applicable LIBOR by (b) 1.00 minus the LIBOR Reserve Percentage.
"LIBOR Reserve Percentage" means for any day that percentage (expressed
as a decimal) which is in effect on such day, as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for determining the
maximum reserve requirement (including, without limitation, all basic,
supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in
- 12 -
19
reserve requirements) for a member bank of the Federal Reserve System in respect
of Eurocurrency Liabilities (as that term is defined in Regulation D of the
Board of Governors of the Federal Reserve System, as in effect from time to
time). The LIBOR Rate shall be adjusted automatically on and as of the effective
date of any change in the LIBOR Reserve Percentage.
"License" means any authorization, permit, consent, franchise,
ordinance, registration, certificate, license, agreement or other right filed
with, granted by, or entered into by a federal, state or local governmental
authority which permits or authorizes the acquisition, construction or operation
of a radio broadcasting station, or any part of a radio broadcasting station or
which is required for the acquisition, ownership or operation of any Station.
"License Partnership" means ECI License Company, L.P., a Pennsylvania
limited partnership, of which the Borrower is the sole general partner with a
99% partnership interest, and ECI Investors Corporation, a Delaware corporation,
is the sole limited partner with a 1% partnership interest.
"License Subsidiary" means the License Partnership and each other
Subsidiary formed pursuant to Section 8.10(b)or (c) solely for the purpose of
holding Licenses issued by the FCC.
"Licensing Authority" means a governmental authority which has granted
or issued a License.
"Lien" as applied to the property of any Person means: (a) any
mortgage, lien, pledge, charge, lease constituting a Capitalized Lease
Obligation, conditional sale or other title retention agreement, or other
security interest or encumbrance of any kind in respect of any property of such
Person, or upon the income or profits therefrom; (b) any arrangement, express or
implied, under which any property of such Person is transferred, sequestered or
otherwise identified for the purpose of subjecting the same to the payment of
Indebtedness in priority to the payment of the general, unsecured creditors of
such Person; (c) the filing of, or any agreement to give, any financing
statement under the Uniform Commercial Code or its equivalent of any
jurisdiction in respect of Indebtedness; and (d) in the case of securities or
other equity interests, any purchase option, call
- 13 -
20
or similar right of a third party with respect to such securities or other
equity interests.
"Loans" has the meaning assigned to it in Section 2.1(a).
"Management Agreement" means the Management and License Agreement dated
as of December 23, 1992, between the Borrower and the License Partnership and
any amendments thereto.
"Material Adverse Effect" means a material adverse effect upon or
change in (a) the properties, assets, business, operations, financial condition
or prospects of the Borrower or any of its Subsidiaries or on the ability of the
Borrower or any such Subsidiary to conduct its business (other than matters
reflected in the audited financial statements contained in Exhibit B attached
hereto or otherwise disclosed herein), (b) the ability of the Borrower, any of
the Borrower's Subsidiaries or any other party to a Collateral Document (other
than either Agent or any Bank) to perform its obligations hereunder or under any
other Collateral Document to which it is a party, (c) the validity or
enforceability of this Agreement, the Notes or any other Collateral Document, or
(d) the rights or remedies of the Agents or the Banks under this Agreement, the
Notes or any other Collateral Document or at law or in equity.
"Net Earnings" means, with respect to the Borrower, the consolidated
net income (or deficit) of the Borrower and its Subsidiaries for the period
involved, after taxes incurred and after all proper charges and reserves
(excluding, however, non-recurring special charges and credits), all as
determined in accordance with GAAP.
"Notes" has the meaning assigned to it in Section 2.4.
"Obligations" means any obligation of the Borrower or any of its
Subsidiaries (a) to pay to the Banks the principal of and interest on the Loans
in accordance with the terms hereof and of the Notes, including, without
limitation, any interest accruing after the date of any filing by the Borrower
or any Subsidiary of any petition in bankruptcy or the commencing of bankruptcy,
insolvency or similar proceedings with respect to the Borrower or any of its
Subsidiaries, regardless of whether such interest is allowable as a claim in any
such proceeding; (b) in respect of
- 14 -
21
the contingent liability of the Borrower under all outstanding Letters of Credit
and in respect of the contingent liability of the Borrower to KCCI under the
Xxxxxxxx Letter of Credit; (c) in respect of any net Rate Hedging Obligations
owing to any Bank or any Affiliate of any Bank; (d) to pay, satisfy or perform
any other liability or obligation to either Agent or any Bank, arising under
this Agreement or any Collateral Document, whether now existing or hereafter
incurred by reason of future advances or otherwise, matured or unmatured, direct
or contingent, joint or several, including any extensions, modifications or
renewals thereof and substitutions therefor, and including without limitation
all fees, indemnification amounts, costs and expenses, including interest
thereon and reasonable attorneys' fees, incurred by either Agent or any Bank for
the protection, preservation or enforcement of its rights and remedies arising
hereunder or under the Collateral Documents; (e) to repay to the Banks all
amounts advanced at any time by the Banks hereunder or under any Collateral
Document, including, without limitation, advances for principal or interest
payments to prior secured parties, mortgagees, lienors or other Persons, or for
taxes, levies, insurance, rent or repairs to, or maintenance or storage of, any
of the property of the Borrower or any of its Subsidiaries; (f) to perform any
covenant or agreement made with the Banks pursuant to this Agreement or any
Collateral Document; or (g) to take any other action in respect of any other
liability of any nature of the Borrower or any of its Subsidiaries to the Banks
under this Agreement or any Collateral Document.
"Operating Agreement" means any programming agreement, time brokerage,
local marketing or similar agreement, franchise agreement, lease or other
agreement relating to the operation of a Station by the Borrower or any of its
Subsidiaries, the termination or adverse modification of which could have a
Material Adverse Effect.
"Operating Cash Flow" means, during any period, the consolidated Net
Earnings of the Borrower for such period (excluding, to the extent included in
Net Earnings, (i) the effect of any exchange of advertising time for non-cash
consideration, such as merchandise or services, (ii) any other non-cash income
or expense (including the cumulative effect of a change in accounting principles
and extraordinary items), and (iii) any gains or losses net of taxes from sales,
exchanges and
- 15 -
22
other dispositions of property not in the ordinary course of business, including
non-recurring charges relating to such exchanges or dispositions), minus any
non-operating income (other than interest income and investment income), plus
the sum of (a) depreciation on or obsolescence of fixed or capital assets and
amortization of intangibles and leasehold improvements for such period, plus (b)
Interest Expense incurred in such period plus interest incurred on the
Indebtedness under the Subordinated Purchase Agreement, plus (c) federal, state
and local income taxes incurred in such period to the extent deducted in
calculating Net Earnings in such period (other than any such tax Distributions
resulting from any gains from sales and exchanges and other distributions not in
the ordinary course of business), plus (d) the costs relating to discontinued
operations, all on a consolidated basis and computed on the accrual method. For
purposes of calculating Operating Cash Flow in any period (other than for
purposes of calculating Excess Cash Flow):
(A) any acquisition of any Station, and any sale or other
disposition of any Station, which occurs during such period shall be deemed to
have occurred on the first day of such period;
(B) Operating Cash Flow shall be increased by the difference,
if positive, of $167,000 minus the product of $13,917 times the number of months
in the period from March 1, 1997, through the end of the period for which
Operating Cash Flow is being calculated;
(C) Operating Cash Flow shall be increased by the difference,
if positive, of $339,000 minus the product of $28,250 times the number of months
in the period from March 1, 1997, through the end of the period for which
Operating Cash Flow is being calculated;
(D) Operating Cash Flow shall be increased by the difference,
if positive, of $2,800,000 minus the product of $233,333 times the number of
months in the period from May 1, 1997, through the end of the period for which
Operating Cash Flow is being calculated;
(E) Operating Cash Flow shall be increased by the difference,
if positive, of $400,000 minus the product of $33,333 times the number of months
in the period from May 1, 1997,
- 16 -
23
through the end of the period for which Operating Cash Flow is being calculated;
(F) Operating Cash Flow shall be increased by the difference,
if positive, of $802,000 minus the product of $66,833 times the number of months
in the period from March 1, 1998, through the end of the period for which
Operating Cash Flow is being calculated;
(G) For periods after the date on which the Borrower acquires
radio stations KKSN-AM, KKSN-FM and KKRH-FM pursuant to the Xxxxxxxx Purchase
Agreement, Operating Cash Flow shall be increased by the difference, if
positive, of $323,000 minus the product of $26,917 times the number of months in
the period from the first day of the third full calendar month after the date on
which the Borrower acquires such stations through the end of the period for
which Operating Cash Flow is being calculated; and
(H) Operating Cash Flow shall be calculated as if the License
Partnership were a wholly owned Subsidiary of the Borrower.
"PBGC" means the Pension Benefit Guaranty Corporation or any
governmental authority at any time substituted therefor.
"Pension Plan" means an employee pension benefit plan as defined in
Section 3(2) of ERISA which is subject to the provisions of Section 302 or Title
IV of ERISA or Section 412 of the Code.
"Permitted Acquisition" has the meaning assigned to it in Section
8.10(b).
"Permitted Lien" means any of the following Liens:
(a) Liens for taxes or assessments and similar charges, which
are either not delinquent or being contested diligently and in good faith by
appropriate proceedings, and (i) as to which the Borrower or its affected
Subsidiary has set aside adequate reserves in accordance with GAAP on its books
and (ii) which do not entail any significant risk of loss, forfeiture,
foreclosure or sale of the property subject thereto;
- 17 -
24
(b) statutory Liens, such as mechanic's, materialman's,
warehouseman's, landlord's, artisan's, xxxxxxx'x, contractor's, carrier's or
other like Liens, (i) incurred in good faith in the ordinary course of business,
(ii) which are either not delinquent or are being contested diligently and in
good faith by appropriate proceedings, (iii) as to which the Borrower or its
affected Subsidiary has set aside adequate reserves in accordance with GAAP on
its books or bonded satisfactorily to the Administrative Agent and (iv) which do
not entail any significant risk of loss, forfeiture, foreclosure or sale of the
property subject thereto;
(c) encumbrances consisting of zoning restrictions, easements,
licenses, reservations, provisions, covenants, conditions, waivers, restrictions
on the use of real property or minor irregularities of title, provided that none
of such encumbrances materially impairs the use or value of any property in the
operation of the Borrower's or any of its Subsidiaries' business;
(d) Liens securing conditional sale, rental or purchase money
obligations permitted under Section 8.4 and Capitalized Lease Obligations
permitted under Section 8.6 (and protective UCC-1 financing statements filed by
lessors in connection therewith under leases not intended as security), but only
in the property which is the subject of such obligations;
(e) Liens arising under or pursuant to this Agreement or any
Collateral Document or otherwise securing any Obligation;
(f) Liens in respect of judgments or awards with respect to
which the Borrower or any of its Subsidiaries is, in good faith, prosecuting an
appeal or proceeding for review and with respect to which a stay of execution
upon such appeal or proceeding for review has been secured, and as to which
judgments or awards the Borrower or such Subsidiary has established adequate
reserves in accordance with GAAP on its books or has bonded in a manner
satisfactory to the Administrative Agent;
(g) pledges or deposits made in the ordinary course of
business to secure payment of worker's compensation, or to participate in any
fund in connection with worker's compensation,
- 18 -
25
unemployment insurance, old-age pensions or other social security programs;
(h) Liens granted to secure the performance of bids, tenders,
contracts, leases, public or statutory obligations, surety, customs, appeal and
performance bonds and other similar obligations and not incurred in connection
with the borrowing of money, the obtaining of advances or the payment of the
deferred purchase price of any property; and
(i) any other Liens listed on Exhibit F hereto or to which the
Required Banks have consented in writing.
"Person" shall include natural persons, corporations, business trusts,
associations, companies, limited liability companies, joint ventures and
partnerships.
"Plan" means any employee benefit plan, as defined under Section 3(3)
of ERISA, established or maintained by the Borrower or any member of the
Controlled Group or any such Plan to which the Borrower or any member of the
Controlled Group is, or in the last six years was, required to contribute on
behalf of its employees.
"Pledge Agreements" means the Borrower Pledge Agreement and the
Subsidiary Pledge Agreements.
"Possible Default" means an event, condition, situation or thing which
constitutes, or which with the lapse of any applicable grace period or the
giving of notice or both would constitute, an Event of Default.
"Prepayment Premium" with respect to the prepayment or conversion of
any LIBOR Loan or any other receipt or recovery of any LIBOR Loan prior to the
end of the applicable Interest Period, whether by voluntary prepayment,
acceleration, conversion to a Base Rate Loan or otherwise, means an amount equal
to the sum of (a) the present value (discounted at the Discount Rate) of the
product of (i) the excess, if any, of the rate of interest applicable to such
Loan pursuant to Section 3.1 hereof at the time of such prepayment or conversion
on the principal amount so prepaid, converted or accelerated, as the case may
be, over the Discount Rate, as determined by the Administrative Agent,
- 19 -
26
multiplied by (ii) the principal amount so prepaid, converted or accelerated, as
the case may be, multiplied by (iii) a fraction, the numerator of which is the
number of days remaining in the related Interest Period and the denominator of
which is 360 (taking into consideration the applicable compounding for the
frequency of installment payments of the Loans being prepaid), plus (b)
reasonable out-of-pocket costs and expenses incurred by the Banks and the
Administrative Agent with respect to such prepayment.
"Project Capital Expenditures" means Capital Expenditures incurred with
respect to a radio station for (i) the construction or relocation of Station
facilities; (ii) the construction of new tower and transmitting equipment; and
(iii) the upgrade of radio signals, which are incurred no earlier than twelve
months after the acquisition of such Station.
"Projected Debt Service" means, as of the end of any quarter, the sum
of (a) all principal payments required to be made on the Loans pursuant to
Sections 2.1(b) and 2.6(b)(i) during the four quarter period following such
date, (b) all principal payments required to be made by the Borrower and its
Subsidiaries on Total Debt, other than the Loans, during such subsequent four
quarter period, and (c) all Interest Expense during such subsequent four quarter
period. In calculating Projected Debt Service, (i) the interest rate in effect
in such subsequent period on any Indebtedness which does not bear interest at a
rate which is fixed for the entire subsequent period shall be deemed to be the
interest rate in effect on such Indebtedness as of the date of determination,
and (ii) for the purpose of determining the amount of principal payments
required on the Loans pursuant to Section 2.1(b) and 2.6(b)(i) in future
periods, it shall be assumed that the principal amount of Loans outstanding as
of the date of determination will be outstanding for the subsequent four quarter
period, subject to any required Commitment reductions.
"Quarterly Date" means the last day of each of the Borrower's fiscal
quarters.
"Ratable Share" means, with respect to any Bank, its pro rata share of
the Commitment, the Letters of Credit or the Loans, as such pro rata share may
be modified pursuant to Section 2.15
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27
or by assignment pursuant to Section 12.7. As of the date of this Agreement, the
Ratable Shares of the Banks shall be as listed on Schedule 1.1 attached hereto.
"Rate Hedging Obligations" means any and all obligations of the
Borrower, whether absolute or contingent and howsoever and whensoever created,
arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (a) any and all
agreements, devices or arrangements designed to protect the Borrower from the
fluctuations of interest rates, including interest rate exchange or swap
agreements, interest rate cap or collar protection agreements, and interest rate
options, puts and warrants, and (b) any and all cancellations, buy backs,
reversals, terminations or assignments of any of the foregoing.
"Regulatory Change" means the adoption of or any change in federal,
state or local treaties, laws, rules or regulations or the adoption of or change
in any interpretations, guidelines, directives or requests of or under any
federal, state or local treaties, laws, rules or regulations (whether or not
having the force of law) by any court, governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof.
"Release" shall mean any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the indoor or outdoor environment, including, without limitation, the movement
of Hazardous Materials through ambient air, soil, surface water, ground water,
wetlands, land or subsurface strata.
"Reportable Event" means a reportable event as that term is defined in
Title IV of ERISA, excluding, however, such events as to which the PBGC by
regulation has waived the requirement of Section 4043(a) of ERISA that it be
notified within thirty days of the occurrence of such event (provided that a
failure to meet the minimum funding standard of Section 412 of the Code and of
Section 302 of ERISA shall be a Reportable Event regardless of the issuance of
any such waivers in accordance with Section 412(d) of the Code).
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28
"Required Banks" means, at any time, Banks holding at least 51% of the
then aggregate unpaid principal amount of the Notes and the stated amount of the
outstanding Letters of Credit, or, if no principal amount of the Notes or any
Letter of Credit is then outstanding, Banks having at least 51% of the
Commitment.
"Security Agreements" means the Borrower Security Agreement and the
Subsidiary Security Agreement.
"Xxxxxxxx Letter of Credit" means the letter of credit issued by KCCI
for the account of the Borrower in connection with the Xxxxxxxx Purchase
Agreement.
"Xxxxxxxx Purchase Agreement" means the Asset Purchase Agreement, dated
January 26, 1998, among Tuscaloosa Broadcasting, Inc., Xxxxxxxx Radio of
Portland Licensee, Inc., Xxxxxxxx Radio of Rochester Licensee, Inc., the
Borrower and the License Partnership pursuant to which the Borrower and the
License Partnership will acquire substantially all of the assets relating to
radio stations KKSN-AM/FM, Portland, Oregon, KKRH, Salem, Oregon, WKLX, WBEE,
WBBF, Rochester, New York, and WQRV, Avon, New York for a purchase price of
approximately $126,500,000.
"Stations" means, as of any date, the radio broadcasting stations owned
by the Borrower or any of its Subsidiaries as of such date; all auxiliary
stations owned or operated in connection with the foregoing or any other
communications station owned or operated at such time by the Borrower or any of
its Subsidiaries.
"Subordinated Debt" means all Indebtedness of the Borrower incurred
pursuant to the provisions of Section 8.1(g). Indebtedness owing to the
Subordinated Lender pursuant to the Subordinated Purchase Agreement shall not
constitute Subordinated Debt.
"Subordinated Lender" means Chase Equity Associates, L.P. and any other
holder of Indebtedness of the Borrower under the Subordinated Purchase Agreement
or any of the notes issued pursuant thereto.
"Subordinated Purchase Agreement" means the Convertible Subordinated
Note Purchase Agreement dated as of May 21, 1996,
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29
between the Borrower and Chase Equity Associates, L.P., as the same may be
amended to the extent permitted in Section 8.19.
"Subsidiary" means each partnership, corporation or limited liability
company, the majority of the outstanding partnership interests, capital stock,
membership interests or voting power of which is (or upon the exercise of all
outstanding warrants, options and other rights would be) owned, directly or
indirectly, at the time in question by the Borrower.
"Subsidiary Pledge Agreements" has the meaning assigned to it in
Section 6.3(b).
"Subsidiary Security Agreement" has the meaning assigned to it in
Section 6.2.
"Tax Liability" means the aggregate federal and state income tax
liability for any tax year (exclusive of penalties and interest) of a
shareholder of the Borrower which arises from the allocation to such shareholder
for income tax purposes of taxable income and/or taxable gain of the Borrower
for the tax year in question, calculated by assuming that all such income is
taxed at the highest marginal rate for federal and state income tax purposes to
which any shareholder is subject. Income and losses from any prior or succeeding
year shall not be considered in making such calculation.
"Termination Date" means February 13, 2006.
"Total Debt" means (a) all Indebtedness of the Borrower and its
Subsidiaries for borrowed money, including, without limitation, the Loans, (b)
all Capitalized Lease Obligations of the Borrower and its Subsidiaries, (c) all
other Indebtedness of the Borrower or any of its Subsidiaries represented by
notes or drafts representing extensions of credit or on which interest is
typically charged, (d) all obligations of the Borrower and its Subsidiaries
evidenced by bonds, debentures, notes or other similar instruments (including
all such obligations to which any property or asset owned by the Borrower or any
of its Subsidiaries is subject, whether or not the obligation secured thereby
shall have been assumed), (e) all obligations of the Borrower and its
Subsidiaries under conditional sale or other title retention agreements relating
to purchased assets, (f) all
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obligations of the Borrower and its Subsidiaries which are incurred, issued or
assumed as the deferred purchase price of property or services and which are
payable over a period in excess of one year, (g) all obligations or liabilities
in respect of which the Borrower or any of its Subsidiaries is a Guarantor, (h)
at any time after the occurrence and during the continuance of an event of
default under any agreement of the Borrower or any of its Subsidiaries governing
Rate Hedging Obligations, the aggregate amount payable by the Borrower or such
Subsidiary under such agreement, and (i) all obligations of the Borrower and its
Subsidiaries as an account party to reimburse any Person in respect of letters
of credit (including the Letters of Credit) or bankers' acceptances; provided,
however, that the amounts outstanding under the Subordinated Purchase Agreement
and the notes issued pursuant thereto shall not constitute Total Debt.
"Working Capital" means, as of any date, the excess of the consolidated
current assets, other than cash, of the Borrower and its Subsidiaries over their
consolidated current liabilities, other than the current portion of long term
debt, as of such date.
1.2 Other Terms. Except as otherwise specifically provided in this
Agreement, each term not otherwise expressly defined herein which is defined in
the Uniform Commercial Code, as amended (the "UCC") as adopted in any applicable
jurisdiction shall have the meaning assigned to it in the UCC in effect in such
jurisdiction. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. All references herein to
Sections, Schedules or Exhibits shall be deemed to be references to Sections of,
and Schedules and Exhibits to, this Agreement unless the context shall otherwise
require. Whenever any agreement, promissory note or other instrument or document
is defined in this Agreement, such definition shall be deemed to mean and
include, from and after the date of any amendment, restatement or modification
thereof, such agreement, promissory note or other instrument or document as so
amended, restated or modified. All terms defined in this Agreement in the
singular shall have comparable meanings when used in the plural and vice versa.
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.
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31
1.3 Accounting Provisions. All accounting terms used in this Agreement
which are not expressly defined herein shall have the respective meanings given
to them in accordance with GAAP, all computations shall be made in accordance
with GAAP, and all balance sheets and other financial statements shall be
prepared in accordance with GAAP.
SECTION 2 THE LOANS.
2.1 The Commitment and the Loans.
(a) Subject to the terms and conditions hereof, during the
period from the Closing Date up to but not including the Termination Date, the
Banks severally, but not jointly, shall make loans to the Borrower in such
amounts as the Borrower may from time to time request but not exceeding in
aggregate principal amount at any one time outstanding $300,000,000 (as such
amount may be (i) increased pursuant to Section 2.15 or (ii) reduced pursuant to
Section 2.1(d), 2.6 or any other provision of this Agreement, from time to time,
the "Commitment"); provided, however, that in no event shall the aggregate
principal amount of such loans plus the aggregate stated amount of the Letters
of Credit exceed the Commitment. All amounts borrowed by the Borrower pursuant
to this Section 2.1(a) and all amounts drawn under any Letter of Credit and not
repaid may be referred to hereinafter collectively as the "Loans." Each Loan
requested by the Borrower shall be funded by the Banks in accordance with their
Ratable Shares of the requested Loan. A Bank shall not be obligated hereunder to
make any additional Loan if immediately after making such Loan, the aggregate
principal balance of all Loans made by such Bank plus such Bank's Ratable Share
of any outstanding Letters of Credit would exceed such Bank's Ratable Share of
the Commitment. The Loans may be comprised of Base Rate Loans or LIBOR Loans, as
provided in Section 2.3.
(b) On each date set forth in the table below, the Commitment
shall automatically reduce by that percentage of the Commitment (as in effect on
June 30, 2000, before giving effect to the reduction required by this Section
2.1(b) on that date) set forth for such date in such table:
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32
Year February 13 March 31 June 30 September 30 December 31
2000 0% 0% 1.25% 1.25% 1.25%
2001 0% 1.25% 3.75% 3.75% 3.75%
2002 0% 3.75% 5% 5% 5%
2003 0% 5% 5% 5% 5%
2004 0% 5% 5% 5% 5%
2005 0% 5% 5% 5% 5%
2006 all
remaining
principal
(c) Prior to the Termination Date, the Borrower may, at its
option, from time to time prepay all or any portion of the Loans, subject to the
provisions of Section 2.6, and the Borrower may reborrow from time to time
hereunder amounts so paid up to the amount of the Commitment in effect at the
time of reborrowing.
(d) At any time prior to the Termination Date, by written
notice to the Administrative Agent no later than 11:00 A.M. Cleveland, Ohio time
five Banking Days prior to such termination or reduction, the Borrower may
permanently terminate, or from time to time permanently reduce, the Commitment.
Such notice shall be in writing or by telephonic communication confirmed by
telecopy or other facsimile transmission on the same day as such telephone
notice. Any such partial reduction hereunder shall be in an amount which is not
less than $1,000,000 or an integral multiple of $500,000 in excess thereof. The
Administrative Agent shall notify the Banks of any such reduction or termination
of the Commitment.
(e) All Loans, together with all interest accrued thereon,
shall be paid in full no later than the Termination Date.
(f) All reductions of the Commitment pursuant to Section
2.1(d), 2.6(c) or any other provision of this Agreement
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33
shall be permanent reductions, and the Commitment shall not be increased.
2.2 Letters of Credit.
(a) Issuance. Subject to the terms and conditions hereof,
including the provisions of Section 6, the Borrower may request that the Issuing
Bank issue, from time to time, and the Issuing Bank agrees to issue, from time
to time, letters of credit in an aggregate stated amount not exceeding
$15,000,000 (the "Letters of Credit"). No Letter of Credit shall be issued for a
term of more than three hundred sixty-four days, and no Letter of Credit shall
have an expiration date which is later than the Termination Date. No Letter of
Credit shall be issued if after giving effect to such issuance, the sum of the
outstanding principal balance of the Loans (including amounts drawn on Letters
of Credit and not repaid), plus the aggregate stated amount of outstanding
Letters of Credit, would exceed the Commitment. Each Letter of Credit shall be
issued in the manner and on the conditions set forth in this Section 2.2 and
Section 6.
(b) Application. Each request for a Letter of Credit shall be
made to the Issuing Bank by an application on the Issuing Bank's standard form
or in such other manner as the Issuing Bank may approve. Promptly following the
issuance of any Letter of Credit, the Issuing Bank shall notify the
Administrative Agent and the Banks of such issuance.
(c) Participation by the Banks.
(i) By the issuance of a Letter of Credit and
without any further action on the part of the Issuing Bank, the Administrative
Agent or the other Banks in respect thereof, the Issuing Bank hereby grants to
each other Bank, and each other Bank hereby agrees to acquire from the Issuing
Bank, a participation in such Letter of Credit equal to such Bank's Ratable
Share of the stated amount of such Letter of Credit, effective upon the issuance
of such Letter of Credit; provided, however, that no Bank shall be required to
acquire participations in any Letter of Credit that would result in its Ratable
Share of the sum of outstanding Loans plus the stated amount of all outstanding
Letters of Credit to be greater than its Ratable
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Share of the Commitment. In consideration and in furtherance of the foregoing,
each Bank hereby absolutely and unconditionally agrees to pay to the
Administrative Agent, for the account of the Issuing Bank, in accordance with
Section 2.2(d), such Bank's Ratable Share of each amount disbursed pursuant to a
Letter of Credit; provided, that payment by the Issuing Bank under such Letter
of Credit against presentation of such draft or document shall not have
constituted gross negligence or willful misconduct of the Issuing Bank.
(ii) Each Bank acknowledges and agrees that its
obligation to acquire participations pursuant to paragraph (i) above in respect
of Letters of Credit is absolute and unconditional and shall not be affected by
any circumstances whatsoever, including the occurrence and continuance of an
Event of Default or Possible Default, and that each such payment shall be made
without any offset, abatement, withholding or reduction whatsoever.
(d) Letter of Credit Disbursements.
(i) If the Administrative Agent has not received
from the Borrower the payment permitted pursuant to paragraph (ii) of this
Section 2.2(d) by 11:00 a.m., Cleveland time, on the date on which the Issuing
Bank has notified the Borrower that payment of a draft presented under any
Letter of Credit will be made, as provided in such paragraph (ii), the
Administrative Agent shall promptly notify the Issuing Bank and each other Bank
of the disbursement to be made under such Letter of Credit and, in the case of
each Bank, its Ratable Share of such disbursement. Each Bank shall pay to the
Administrative Agent, not later than 1:00 P.M., Cleveland time, on such date
(or, if the Issuing Bank shall elect to defer reimbursement from the Banks
hereunder, such later date as the Issuing Bank shall specify by notice to the
Administrative Agent and the Banks), such Bank's Ratable Share of such
disbursement, which the Administrative Agent shall promptly pay to the Issuing
Bank. The Administrative Agent will promptly remit to each Bank its share of any
amount subsequently received by the Administrative Agent from the Borrower in
respect of such disbursement; provided that amounts so received for the account
of any Bank prior to payment by such Bank of amounts required to be paid by it
hereunder in respect of any disbursement shall be remitted to the Issuing Bank.
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(ii) If the Issuing Bank shall receive any draft
presented under any Letter of Credit, the Issuing Bank shall give notice thereof
as provided in paragraph (iii) below. If the Issuing Bank shall pay any draft
presented under a Letter of Credit, the Borrower may (but shall not be required
to) pay to the Administrative Agent, for the account of the Issuing Bank, an
amount equal to the amount of such draft before 11:00 A.M., Cleveland time, on
the Banking Day on which the Issuing Bank shall have notified the Borrower that
payment of such draft will be made. The Administrative Agent will promptly pay
any such amounts received by it to the Issuing Bank.
(iii) The Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit to ascertain that the same appear on their face
to be in substantial conformity with the terms and conditions of such Letter of
Credit. The Issuing Bank shall as promptly as reasonably practicable give oral
notification, confirmed in writing, to the Administrative Agent and the Borrower
of such demand for payment and the determination by the Issuing Bank as to
whether such demand for payment was in accordance with the terms and conditions
of such Letter of Credit and whether the Issuing Bank has made or will make a
disbursement thereunder, provided that the failure to give such notice shall not
relieve the Borrower of its obligation to reimburse such disbursement, and the
Administrative Agent shall promptly give each Bank notice thereof.
(iv) Any amounts paid by the Issuing Bank on any
Letter of Credit shall be deemed to be a Loan for all purposes of this Agreement
and shall bear interest from the date of payment by the Issuing Bank at the
rates provided in Section 3.1 until paid in full.
(e) Obligation to Repay Letter of Credit Disbursements, etc.
The Borrower assumes all risks in connection with the Letters of Credit and the
Borrower's obligation to repay each disbursement under a Letter of Credit shall
be absolute, unconditional and irrevocable under any and all circumstances and
irrespective of:
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(i) any lack of validity or enforceability of any
Letter of Credit;
(ii) the existence of any claim, setoff, defense
or other right which the Borrower or any other person may at any time have
against the beneficiary under any Letter of Credit, the Administrative Agent,
the Issuing Bank or any other Bank (other than the defense of payment in
accordance with the terms of this Agreement or a defense based on the gross
negligence or willful misconduct of the Issuing Bank) or any other Person in
connection with this Agreement or any other agreement or transaction;
(iii) any draft or other document presented under
a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any respect
other than a defense based on the willful misconduct or gross negligence of the
Issuing Bank; and
(iv) any other circumstance or event whatsoever,
whether or not similar to any of the foregoing that does not result from the
willful misconduct or gross negligence of the Issuing Bank.
It is understood that in making any payment under a Letter of Credit
(A) the Issuing Bank's exclusive reliance as to any and all matters set forth
therein, including reliance on the amount of any draft presented under such
Letter of Credit, whether or not the amount due to the beneficiary equals the
amount of such draft and whether or not any documents presented pursuant to such
Letter of Credit prove to be insufficient in any respect, if such document on
its face appears to be in order, and whether or not any such Letter of Credit
proves to be forged or invalid or any statement therein proves to be inaccurate
or untrue in any respect whatsoever, shall, in each case, not in and of itself
be deemed willful misconduct or gross negligence of the Issuing Bank and (B) any
noncompliance in any immaterial respect of the documents presented under a
Letter of Credit with the terms thereof, shall, in each case, not in and of
itself be deemed willful misconduct or gross negligence of the Issuing Bank.
(f) Indemnification. The Borrower shall: (i) indemnify and
hold the Administrative Agent and each Bank (including the Issuing Bank)
harmless from any loss resulting
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from any claim, demand or liability which may be asserted against the
Administrative Agent or such Bank in connection with actions taken under any
Letter of Credit, and (ii) reimburse the Administrative Agent or such Bank for
any fees or other reasonable expenses paid or incurred by the Administrative
Agent or such Bank in connection with any Letter of Credit, other than any loss
or expense resulting from the Administrative Agent's or such Bank's willful
misconduct or gross negligence.
(g) Security. Upon the occurrence of any Event of Default, the
Borrower shall, upon demand, pay to the Issuing Bank the stated amount of all
outstanding Letters of Credit, which amount the Issuing Bank shall hold as
security for the obligations incurred under the Letters of Credit, this
Agreement and the Notes. The payment by the Borrower of such security shall not
terminate the obligations of the Borrower under this Section 2.2, but the stated
amount of such Letters of Credit to the extent of such security payment shall
not be deemed to be Indebtedness for purposes of determining the Borrower's
compliance with the covenants set forth in Section 8.13 or for determining the
Applicable Margin.
(h) Additional Costs. If any Regulatory Change shall either
(i) impose upon, modify, require, make or deem applicable to the Issuing Bank,
the Administrative Agent or any Bank (or its holding company) any reserve
requirement, special deposit requirement, insurance assessment or similar
requirement against or affecting any Letter of Credit issued or to be issued
hereunder, or (ii) subject the Issuing Bank, the Administrative Agent or any
Bank to any tax (other than taxes imposed on the net income of the
Administrative Agent, the Issuing Bank or such other Bank), charge, fee,
deduction or withholding of any kind whatsoever, or (iii) impose any condition
upon or cause in any manner the addition of any supplement to or increase of any
kind to the Issuing Bank's, the Administrative Agent's or any Bank's (or its
holding company's) capital or cost base for issuing such Letter of Credit which
results in an increase in the capital requirement supporting such Letter of
Credit, or (iii) impose upon, modify, require, make or deem applicable to the
Issuing Bank, the Administrative Agent or any Bank (or its holding company) any
capital requirement, increased capital requirement or similar requirement such
as the deeming of such Letters of Credit to be assets held by the Issuing Bank,
the Administrative
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Agent or such Bank (or its holding company) for capital calculation or other
purposes and the result of any events referred to in (i), (ii), (iii) or (iv)
above shall be to increase the costs or decrease the benefit in any way to the
Issuing Bank, the Administrative Agent or a Bank (or its holding company) of
issuing, maintaining or participating in such Letters of Credit, then and in
such event the Borrower shall, within ten days after the mailing of written
notice of such increased costs and/or decreased benefits to the Administrative
Agent and the Borrower, pay to the Issuing Bank, the Administrative Agent or
such Bank all such additional amounts which in the Issuing Bank's, the
Administrative Agent's or such Bank's good faith calculation as allocated to
such Letters of Credit, shall be sufficient to compensate it (or its holding
company) for all such increased costs and/or decreased benefits. The Issuing
Bank's, the Administrative Agent's or such Bank's calculation shall be
conclusive absent manifest error.
(i) Fees. Each Letter of Credit shall be issued for a fee
equal to the product of the Applicable Margin applicable to LIBOR Loans as of
the date of issuance thereof times the stated amount thereof, payable upon
issuance. The fee shall be payable to the Administrative Agent for the benefit
of the Banks in accordance with their Ratable Shares. If any Letter of Credit is
drawn upon prior to its expiration date, the Banks shall reimburse to the
Borrowers that portion of the fee allocable to the period from the date of the
draw to the expiration date, calculated in accordance with the Issuing Bank's
standard letter of credit procedures. In addition, the Borrower shall pay to the
Issuing Bank for its own account its standard charges for the issuance of
letters of credit and for draws upon letters of credit, which charges, as of the
date hereof, are as follows: (i) $200 per Letter of Credit, payable upon
issuance and (ii) $100 per Letter of Credit, payable upon a draw under such
Letter of Credit.
2.3 Making and Continuation/Conversion of the Loans.
(a) Making of the Loans.
(i) Each Loan shall be made by the Banks in such
amount as the Borrower shall request, provided that each borrowing shall be in
an amount which is a minimum of (A), with
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respect to any LIBOR Loan, $3,000,000, and integral multiples of $500,000 in
excess thereof, and (B) with respect to any Base Rate Loan, $1,000,000 and
integral multiples of $500,000 in excess thereof or such lesser amount as may be
equal to the then unused portion of the Commitment. The obligation of the Banks
to make any Loan is conditioned upon the fact that (x) no Possible Default or
Event of Default shall then exist or immediately after the Loan would exist; (y)
all of the Collateral Documents shall still be in full force and effect; and (z)
the representations and warranties contained herein and in the Collateral
Documents shall be true and correct in all material respects as if made on and
as of the date of such borrowing, except to the extent that any thereof
expressly relate to an earlier date.
(ii) Loans shall be effected at the principal
banking office of the Administrative Agent in Cleveland, Ohio, and shall be made
at such times as the Borrower may request by notice to the Administrative Agent
no later than 11:00 A.M. Cleveland, Ohio time (A) three Banking Days prior to
the date of a requested LIBOR Loan and (B) one Banking Day prior to the date of
a requested Base Rate Loan. Such notices shall be in writing, or by telephonic
communication confirmed by telecopy or other facsimile transmission on the same
day as the telephone request, and shall specify the proposed date and the amount
of the requested Loan, whether it is to bear interest initially based upon the
Base Rate or the LIBOR Rate, and the Interest Period thereof, if applicable.
(iii) Upon receipt of each borrowing notice for a
Loan, the Administrative Agent shall promptly notify each Bank of the type,
Interest Period, if applicable, amount and date of the proposed borrowing. Not
later than 11:00 A.M. Cleveland time, on the date of a proposed borrowing of a
Loan, each Bank shall provide the Administrative Agent at its address specified
in Section 12.4 hereof with immediately available funds covering such Bank's
Ratable Share of such Loan, and the Administrative Agent shall pay over such
immediately available funds to the Borrower.
(b) Conversion/Continuation of the Loans. At the Borrower's
election pursuant to notice given to the Administrative Agent not later than
11:00 A.M. Cleveland, Ohio time three Banking Days prior to such conversion or
continuation,
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any Base Rate Loan may be converted to, or any LIBOR Loan may be continued as, a
LIBOR Loan as requested by the Borrower; provided, however, that each conversion
shall be in an amount which is a minimum of $3,000,000, and integral multiples
of $1,000,000 in excess thereof; and provided, further, that no Loan may be
continued as or converted to a LIBOR Loan at any time that an Event of Default
or Possible Default exists. If the Borrower has not delivered to the
Administrative Agent such notice with respect to any terminating Interest Period
at least three Banking Days prior to the end of such Interest Period, the
affected LIBOR Loan shall convert to a Base Rate Loan at the end of such
Interest Period.
(c) Number of Interest Rate Options. In no event shall the
Borrower have more than five LIBOR Loans outstanding at any time.
2.4 The Notes. All Loans shall be evidenced by separate promissory
notes payable to the Banks substantially in the form attached hereto as Exhibit
A to be duly executed and delivered by the Borrower at or prior to the Closing
in the aggregate principal amount of the Commitment (such notes, together with
any notes issued in connection with the issuance of a Letter of Credit being
referred to hereinafter as the "Notes"). The Banks may, and are hereby
authorized by the Borrower to, set forth on the grids attached to the Notes, or
in other comparable records maintained by them, the amount of each Loan, all
payments and prepayments of principal and interest received, the current
outstanding principal balance, and other appropriate information. The aggregate
unpaid amount of any Loan set forth in any records maintained by a Bank with
respect to a Note shall be presumptive evidence of the principal amount owing
and unpaid on such Note. Failure of a Bank to record the principal amount of any
Loan on the grid(s) attached to a Note shall not limit or otherwise affect the
obligation of the Borrower hereunder or under such Note to repay the principal
amount of such Loan and all interest accruing thereon.
2.5 Fees.
(a) Commitment Fees. The Borrower shall pay to the
Administrative Agent for the benefit of the Banks a non-refundable commitment
fee of 0.375% per annum (based on a year
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having 360 days and actual days elapsed) on the excess of the aggregate average
daily undisbursed amount of the Commitment over the aggregate stated amount of
the Letters of Credit then outstanding; provided, however, that the commitment
fee shall be 0.25% per annum for any day on which the Leverage Ratio is less
than or equal to 5.0 to 1.0. Such commitment fee shall (i) commence to accrue as
of the Closing Date and continue for each day to and including the Termination
Date, (ii) be in addition to any other fee required by the terms and conditions
of this Agreement, (iii) be payable quarterly in arrears on each Quarterly Date
and on the date the Commitment is terminated, and (iv) be shared by the Banks in
accordance with their Ratable Shares of the Commitment.
(b) Other Fees. The Borrower shall pay to the Agents such
other fees as are set forth in the Fee Letters.
2.6 Prepayment.
(a) Voluntary Prepayments. By notice to the Administrative
Agent (which shall be in writing or by telephonic communication confirmed by
telecopy or other facsimile transmission on the same day as such telephone
notice) no later than 11:00 A.M. Cleveland, Ohio time on the Banking Day prior
to such prepayment (with respect to any Base Rate Loan) or on the third Banking
Day prior to such prepayment (with respect to any LIBOR Loan), the Borrower may,
at its option, prepay the Loans in whole at any time or in part from time to
time without penalty or premium (except that any such prepayment of any LIBOR
Loan shall be made together with the applicable Prepayment Premium); provided,
however, that each partial prepayment shall be in the aggregate principal amount
of not less than $1,000,000 or an integral multiple of $500,000 in excess
thereof.
(b) Mandatory Prepayments.
(i) Reduction of Commitment. If at any time the
sum of the outstanding principal amount of the Loans plus the stated amount of
all outstanding Letters of Credit exceeds the Commitment, the Borrower shall
immediately prepay the Loans, without penalty or premium (except that any such
prepayment of any LIBOR Loan shall be made together with the applicable
Prepayment Premium), in an amount necessary to cause the sum of
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the outstanding principal amount of the Loans plus the stated amount of all
outstanding Letters of Credit not to exceed the Commitment. All accrued interest
on the amount prepaid shall be paid with the prepayment.
(ii) Excess Cash Flow. If the Leverage Ratio as
of the end of any fiscal year of the Borrower ending on or after September 30,
2000, is 5.0 to 1.0 or greater, then within one hundred twenty-five days after
the end of such fiscal year the Borrower shall make a mandatory prepayment of
the Loans in an amount equal to 50% of Excess Cash Flow, if any, for such fiscal
year. Mandatory prepayments made pursuant to this Section 2.6(b)(ii) shall be
determined from the annual financial statements for such fiscal year delivered
by the Borrower pursuant to Section 7.5(a) and shall be accompanied by a
certificate signed by a financial officer of the Borrower setting forth the
calculations from which the amount of such prepayment was determined.
(iii) Proceeds of Asset Sales.
(A) Subject to paragraph (B) below, if, as
of the end of the quarter most recently ended prior to the consummation of any
Asset Sale, the Leverage Ratio was greater than 5.5 to 1.0, then the Borrower
shall make a mandatory prepayment of the Loans in that amount (not to exceed the
cash proceeds of such Asset Sale, net of any reasonable costs directly incurred
in connection with such Asset Sale and any taxes payable by the Borrower or its
stockholders in connection with such Asset Sale) which, had it been prepaid at
the end of such quarter and applied to the Loans, would have caused the Leverage
Ratio to equal 5.5 to 1.0, and the balance of such net proceeds shall be applied
in accordance with the provisions of the following sentence as if the Leverage
Ratio as of the end of such quarter had been less than 5.5 to 1.0. If, as of the
end of the quarter most recently ended prior to the consummation of any Asset
Sale, the Leverage Ratio was less than or equal to 5.5 to 1.0, then the Borrower
shall not be required to make such a mandatory prepayment of the Loans, so long
as (I) no Event of Default or Possible Default exists as of the date of such
Asset Sale or at the date of the reinvestment of such proceeds and (II) the
Borrower reinvests such proceeds by making a Permitted Acquisition within twelve
months of the date of consummation of
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such Asset Sale. If any such Event of Default or Possible Default exists or if
such proceeds are not so reinvested within such twelve month period, then the
Borrower shall make a mandatory prepayment of the Loans in an amount equal to
the cash proceeds of such Asset Sale, net of any reasonable costs directly
incurred in connection with such Asset Sale and any taxes payable by the
Borrower or its stockholders in connection with such Asset Sale. Together with
any prepayment required by this Section 2.6(b)(iii), the Borrower shall deliver
to the Administrative Agent a certificate executed by a financial officer of the
Borrower setting forth the calculation of the net cash proceeds of such Asset
Sale, including a calculation of the taxes payable by the Borrower or its
stockholders in respect of such sale. Such prepayment shall be made
simultaneously with the consummation of such Asset Sale.
(B) Notwithstanding the foregoing provisions
of this Section 2.6(b)(iii), the Borrower shall not be required to make a
mandatory prepayment of the Loans in connection with the consummation of an
Asset Sale if (I) the Asset Sale is structured as an exchange of like-kind
property under Section 1031 of the Code to the maximum extent possible under
Section 1031 (a "Like Kind Exchange"), (II) the property acquired in the
Like-Kind Exchange is a radio station located in one of the top 75 markets, as
ranked by Metro Survey Area as determined by The Arbitron Company, or in a
market in which the Borrower or one of its Subsidiaries already owns a Station,
(III) no Possible Default or Event of Default exists at the time of such Asset
Sale or would exist after giving effect thereto, and (IV) the Borrower shall
have delivered to the Administrative Agent a certificate of a financial officer
of the Borrower in form and substance satisfactory to the Administrative Agent
which shall contain calculations demonstrating on a pro forma basis the
Borrower's compliance with the financial covenants set forth in Section 8 after
giving effect to such Asset Sale. If the Borrower desires to effect a Like-Kind
Exchange, at or prior to closing the disposition of any Station pursuant to this
paragraph, the Borrower shall (A) establish a "qualified escrow account" within
the meaning of Treas. Reg. Section 1.1031(k)-1(g)(3) with a "qualified
intermediary" within the meaning of Treas. Reg. Section 1.1031(k)-1(g)(4) (the
"Qualified Intermediary"), which account shall be governed by an escrow
agreement complying with the requirements of Treas. Reg. Section 1.1031(k)-1(g)
(4) and 1.1031(k)-1(g)(6), and
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enter into an "exchange agreement" within the meaning of Treas. Reg. Section
1.1031(k)-1(g)(4)(iii)(B) with the Qualified Intermediary and (B) deliver to the
Administrative Agent, as soon as reasonably practicable but in no event later
than the closing of the transfer or other disposition of such Station by the
Borrower or one of its Subsidiaries, a pledge of its rights in the escrow
agreement in form and substance reasonably satisfactory to the Administrative
Agent which governs the "qualified escrow account" and the proceeds thereof. No
later than immediately before the consummation of the closing of the transfer or
other disposition of such Station by the Borrower or one of its Subsidiaries,
the Administrative Agent shall release any and all liens of the Administrative
Agent or the Banks in the cash proceeds from the transfer or other disposition
of such Station for the period necessary (but no longer than necessary) to
comply with the requirements of Treas. Reg. Section 1.1031(k)-1(g)(6). The terms
of the escrow agreement governing the "qualified escrow account" shall, among
other things, provide that immediately upon the occurrence of any event set
forth in Treas. Reg. Section 1.1031(k)-1(g)(6)(ii) or (iii), the cash proceeds
from the transfer or other disposition of such Station, together with any
interest thereon, net of any reasonable costs directly incurred by the Borrower
or its Subsidiary in connection with the transactions contemplated by the
Like-Kind Exchange, and any taxes payable by the Borrower or its stockholders
with respect to such transactions and Like-Kind Exchange, shall be released to
the Administrative Agent, to the extent of any then outstanding balance of the
Loans, to be applied as provided in Section 2.6(c) hereof.
(iv) Insurance Proceeds. Within 180 days after
the date of receipt of any cash payments in excess of $250,000 under any
insurance policy maintained by the Borrower or any of its Subsidiaries which
have not been reinvested in assets of a kind then used or usable in the business
of the Borrower or such Subsidiary or used to maintain the business of the
Borrower and its Subsidiaries as going concerns as a consequence of any business
interruption, the Borrower shall make a mandatory prepayment of the Loans in the
amount of such unreinvested or unused proceeds; provided, however, that
notwithstanding any of the foregoing to the contrary, upon and during the
continuance of any Event of Default or Possible Default, all such insurance
proceeds, regardless of reinvestment or other use, received by
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the Borrower or any Subsidiary shall be applied as a prepayment of the Loans.
(v) Net Equity Proceeds. If the Borrower issues
or sells any shares of its capital stock or other equity interests or securities
convertible into or exercisable for any shares of its capital stock or other
equity interests, and if as of the end of the quarter most recently ended prior
to such issuance or sale (the "Test Date") the Leverage Ratio was greater than
5.5 to 1.0, then the Borrower shall make a mandatory prepayment of the Loans.
Such prepayment shall be in an amount (not to exceed the cash proceeds of such
issuance or sale, net of any reasonable costs directly incurred in connection
with such issuance or sale) equal to the sum of (A) if the Leverage Ratio as of
the Test Date was greater than 6.5 to 1.0, the amount of such proceeds which,
had it been prepaid on the Test Date and applied to the Loans, would have caused
the Leverage Ratio to equal 6.5 to 1.0, plus (B) that amount (not to exceed 50%
of the balance of such proceeds after applying the provisions of clause (A) to
the extent applicable) which, had it been prepaid on the Test Date (and after
giving effect to the payment, if any, pursuant to clause (A)) and applied to the
Loans, would have caused the Leverage Ratio to equal 5.5 to 1.0.
(vi) Subordinated Purchase Agreement. If any
Indebtedness of the Borrower under the Subordinated Purchase Agreement is
outstanding on April 21, 2004 (unless the Subordinated Purchase Agreement has
been amended in accordance with the provisions of Section 8.19 to extend the
final maturity date thereunder to a date that is at least six months later than
the Termination Date), or if the Borrower fails to comply in any material
respect with any of the provisions of Section 7.14, it shall make a mandatory
prepayment of the Loans in the amount of all then outstanding principal together
with all accrued interest and all other amounts then owing hereunder, under any
Note and under any other Collateral Document.
(c) Application of Prepayments; Reduction of Commitment.
(i) Application to Prepayment Premium, Accrued
Interest and Principal. All prepayments made pursuant to this Section 2.6 shall
be applied first to any Prepayment Premium then
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46
due, then to accrued interest in accordance with the Administrative Agent's
standard operating procedures and then to the principal outstanding under the
Loans. For purposes of the calculation of interest and the determination of
whether any Prepayment Premium is due in connection with any such prepayment,
such principal prepayments shall be applied first to the Base Rate Loans and
then to the LIBOR Loans with the shortest remaining Interest Periods.
(ii) Reduction of Commitment and Loans. Any
mandatory prepayment of the Loans pursuant to Sections 2.6(b)(ii), (iii), (iv),
(v) or (vi) shall cause the Commitment to be immediately, automatically and
permanently reduced by the amount of such prepayment, and no amount so prepaid
may be reborrowed. Each such mandatory prepayment of the Loans (other than a
prepayment pursuant to Section 2.6(b)(v)) shall be applied to the subsequent
Commitment reductions set forth in Section 2.1(b) in the inverse order of
maturity. Mandatory prepayments made pursuant to Section 2.6(b)(v) shall be
applied to all subsequent Commitment reductions set forth in Section 2.1(b) pro
rata.
(d) Prepayment Premium. The Borrower shall pay to the
Administrative Agent, for the benefit of the Banks, the applicable Prepayment
Premium upon any prepayment or conversion (whether voluntary or involuntary) of
any LIBOR Loan not made on the last day of the applicable Interest Period.
2.7 Reserves or Deposit Requirements, Etc. If at any time any
Regulatory Change (including without limitation, Regulation D of the Board of
Governors of the Federal Reserve System) shall impose any reserve and/or special
deposit requirement (other than reserves included in the LIBOR Reserve
Percentage, the effect of which is reflected in the interest rate of any LIBOR
Loan) against assets held by, or deposits in or for the amount of any loans by,
any Bank, and the result of the foregoing is to increase the cost (whether by
incurring a cost or adding to a cost) to such Bank of taking or maintaining
hereunder any LIBOR Loan or to reduce the amount of principal, interest or fees
received by such Bank with respect to any such Loan, then such Bank shall notify
the Administrative Agent and the Borrower of such occurrence. Thereafter, upon
demand by such Bank the Borrower shall pay to such Bank additional amounts
sufficient to
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compensate and indemnify such Bank for such increased cost or reduced amount. A
statement as to the increased cost or reduced amount as a result of any event
mentioned in this Section shall be submitted by such Bank to the Administrative
Agent and the Borrower and shall, in the absence of manifest error, be
conclusive and binding as to the amount thereof.
2.8 Tax Law, Increased Costs, Etc. In the event that by reason of any
Regulatory Change, any Bank shall, with respect to this Agreement or any
transaction under this Agreement, be subjected to any tax, levy, impost, charge,
fee, duty, deduction or withholding of any kind whatsoever (other than any tax
imposed upon the net income of such Bank and other than changes in franchise
taxes), and if any such measure or any other similar measure shall result in an
increase in the costs to such Bank of making or maintaining any LIBOR Loan or in
a reduction in the amount of principal or interest ultimately receivable by such
Bank in respect of such Loan, then such Bank shall notify the Administrative
Agent and the Borrower stating the reasons therefor. The Borrower shall
thereafter pay to such Bank within ten days after written demand such additional
amounts as will compensate such Bank for such increased cost or reduced amount.
A statement as to any such increased cost or reduced amount shall be submitted
by such Bank to the Administrative Agent and the Borrower and shall, in the
absence of manifest error, be conclusive and binding as to the amount thereof.
2.9 Eurodollar Deposits Unavailable or Interest Rate Unascertainable.
If any Bank determines that dollar deposits of the relevant amount for the
relevant Interest Period are not available to it in the applicable Eurodollar
market or that, by reason of circumstances affecting such market, adequate and
reasonable means do not exist for ascertaining the LIBOR Rate applicable to such
Interest Period, or that the LIBOR Rate does not adequately reflect the cost to
such Bank of making such Loan, as the case may be, such Bank shall promptly give
notice of such determination to the Administrative Agent and the Borrower, and
any request for a new LIBOR Loan or notice of conversion of an existing Loan to
a LIBOR Loan given thereafter or previously given by the Borrower and not yet
made or converted shall be deemed a notice to make a Base Rate Loan.
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2.10 Changes in Law Rendering LIBOR Loans Unlawful. If at any time
any Regulatory Change shall make it unlawful for any Bank to fund any LIBOR Loan
which it has committed to make hereunder with moneys obtained in the applicable
Eurodollar market, such Bank shall notify the Administrative Agent and the
Borrower, and the obligation of the Banks to fund such Loan shall, upon the
happening of such event, forthwith be suspended for the duration of such
illegality. If any such change makes it unlawful for any Bank to continue in
effect the funding in the applicable Eurodollar market of any LIBOR Loan
previously made by it hereunder, such Bank shall, upon the happening of such
event, notify the Administrative Agent and the Borrower thereof in writing
stating the reasons therefor, and the Borrower shall, on the earlier of (a) the
last day of the then current Interest Period or (b) if required by such
Regulatory Change on such date as shall be specified in such notice, either
convert all such Loans to Base Rate Loans or prepay all such Loans in full.
2.11 Funding. Any Bank may, but shall not be required to, make
LIBOR Loans hereunder with funds obtained outside the United States.
2.12 Indemnity. Without prejudice to any other provisions of
Sections 2.7 through Section 2.11, but without duplication, the Borrower hereby
agrees to indemnify each Bank against any loss or expense which it may sustain
or incur as a consequence of the Borrower's failure to borrow any LIBOR Loan
requested pursuant to this Agreement or any default by the Borrower in payment
when due of any amount due hereunder in respect of any LIBOR Loan, including,
but not limited to, any premium or penalty actually incurred by such Bank in
respect of funds borrowed by it for the purpose of making or maintaining such
Loan, as determined by such Bank. A statement as to any such loss or expense
shall be submitted by such Bank to the Borrower for payment under the aforesaid
indemnification, with a copy to the Administrative Agent, which statement shall,
in the absence of manifest error, be conclusive and binding as to the amount
thereof.
2.13 Capital Adequacy. If any Bank shall determine that any
Regulatory Change regarding capital adequacy or compliance by such Bank (or its
lending office) with any request or directive regarding capital adequacy
(whether or not having the force of law) of any governmental authority, central
bank or comparable
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49
agency has the effect of reducing the rate of return on such Bank's capital (or
on the capital of such Bank's holding company) as a consequence of its
obligations hereunder to a level below that which such Bank (or its holding
company) could have achieved but for such Regulatory Change or compliance
(taking into consideration such Bank's policies or the policies of its holding
company with respect to capital adequacy) by an amount which such Bank deems to
be material, then from time to time, within ten days after demand by such Bank,
the Borrower shall pay to such Bank such additional amount or amounts as will
compensate such Bank (or its holding company) for such reduction. Such Bank will
designate a different lending office if such designation will avoid the need
for, or reduce the amount of, such compensation and will not, in the sole
judgment of such Bank, be otherwise disadvantageous to such Bank. A certificate
of such Bank claiming compensation under this Section and setting forth the
additional amount to be paid to it hereunder shall be conclusive in the absence
of manifest error. In determining such amount, such Bank may use any reasonable
averaging and attribution methods. Failure on the part of any Bank to demand
compensation for any reduction in return on capital with respect to any period
shall not constitute a waiver of such Bank's rights to demand compensation for
any reduction in return on capital in such period or in any other period. The
protection of this Section shall be available to each Bank regardless of any
possible contention of the invalidity or inapplicability of the law, regulation
or other condition which shall have been imposed.
2.14 Taxes.
(a) Without duplication of any other Section of this
Agreement including, without limitation Section 2.8, all sums payable by the
Borrower hereunder or under the Notes or in respect of the Letters of Credit,
whether of principal, interest, fees, expenses or otherwise, shall be paid in
full, free of any deductions or withholdings for any and all present and future
taxes, levies, imposts, stamps, duties, fees, assessments, deductions,
withholdings, and other governmental charges and all liabilities with respect
thereto (collectively referred to as "Taxes"). If the Borrower is prohibited by
law from making payments hereunder or under the Notes or in respect of the
Letters of Credit free of such deductions or withholdings, then the Borrower
shall pay such additional amount as may be necessary
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in order that the actual amount received by the Banks after such deduction or
withholding shall equal the full amount stated to be payable hereunder or under
the Notes or in respect of the Letters of Credit. The Borrower shall pay
directly to all appropriate taxing authorities any and all present and future
Taxes, and all liabilities with respect thereto imposed by law or by any taxing
authority on or with regard to any aspect of the transactions contemplated by
this Agreement or the execution and delivery of this Agreement or the Notes or
the issuance of the Letters of Credit, except for any Taxes or other liabilities
that the Borrower is contesting in good faith by appropriate proceedings,
provided that the Borrower hereby indemnifies the Administrative Agent and the
Banks and holds them harmless from and against any and all liabilities, fees or
additional expense with respect to or resulting from any delay in paying, or
omission to pay, Taxes. Within thirty days after the payment by the Borrower of
any Taxes, the Borrower shall furnish the Administrative Agent with the original
or a certified copy of the receipt evidencing payment thereof, together with any
other information the Administrative Agent may reasonably require to establish
to its satisfaction that full and timely payment of such Taxes has been made.
Each Bank shall notify the Borrower and the Administrative Agent of any payment
of Taxes required or requested of it and shall give due consideration to any
advice or recommendation given in response thereto by the Borrower, and upon
notice from such Bank that Taxes or any liability relating thereto (including
penalties and interest) have been paid, the Borrower shall pay or reimburse such
Bank therefor within ten days of such notice. The foregoing to the contrary
notwithstanding, in no event shall any Bank receive any amount pursuant to this
Section in excess of the amount required to be paid by it in respect of any
Taxes. Without prejudice to the survival of any other agreement of the Borrower
hereunder, the agreements and obligations of the Borrower contained in this
Section shall survive the payment in full of principal and interest hereunder
and under the Note.
(b) Upon the timely request of the Borrower, each Bank
shall execute and deliver to the Borrower, prior to the due date of any sum
payable by the Borrower under this Agreement, one or more (as the Borrower may
reasonably request) United States Internal Revenue Service Forms 4224, Forms
1001, Forms W-8 or Forms W-9, or any applicable successor form, as may be
appropriately applicable to such Bank and which such Bank is
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lawfully able and legally required to execute and deliver. Notwithstanding the
provisions of Sections 2.8 or 2.14(a) to the contrary, the Borrower shall have
no obligation to increase any sum payable in respect of any Tax pursuant to such
Sections to the extent such Bank has failed to deliver to the Borrower any such
Forms reasonably requested by the Borrower pursuant to this Section which is
applicable to such Bank and which such Bank is lawfully able and legally
required to execute and deliver.
2.15 Incremental Commitment. At any time prior to June 30, 2000,
the Borrower may solicit from the Banks an increase in the Commitment of up to
$50,000,000; provided, however, that the Borrower may not request such increase
at any time that a Possible Default or an Event of Default has occurred and is
continuing. With such solicitation, the Borrower shall deliver to the
Administrative Agent and the Banks revised projections for the period from the
date of such solicitation through the Termination Date which shall be in form
and substance reasonably satisfactory to the Administrative Agent and shall
demonstrate the Borrower's ability to timely repay the Loans, assuming the
Commitment as increased pursuant to this Section is fully drawn, and to comply
with the financial covenants contained in Section 8. No Bank shall be obligated
to increase its share of the Commitment beyond the maximum amount it has agreed
to lend as of the Closing Date, and no Bank shall be removed as a Bank for
failure to agree to such increase. If any Bank desires to participate in such
increase in the Commitment (a "Consenting Bank"), such Bank shall notify the
Administrative Agent and the Borrower of the amount by which it desires to
increase its commitment hereunder. The Commitment shall be increased by the
aggregate amount that the Consenting Banks are willing to increase their
respective commitments hereunder, but in no event shall the Commitment by
increased pursuant to this Section by more than $50,000,000. The aggregate
increase in the Commitment shall be shared pro rata by all Consenting Banks or
in such other ratio as the Consenting Banks agree among themselves. The Borrower
shall deliver to each Consenting Bank a new Note reflecting the increase in its
commitment hereunder. The Ratable Shares of all of the Banks shall be adjusted
to reflect such increase in the Commitment, and Schedule 1.1 shall be deemed
modified to reflect such adjustment to the Ratable Shares of the Banks. Any fees
payable in connection with such increase in the Commitment shall be payable only
to the Agents, with respect to
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fees payable to the Agents, and to the Consenting Banks, in their
capacity as Consenting Banks.
SECTION 3 INTEREST; PAYMENTS.
3.1 Interest.
(a) Subject to Section 3.1(c), prior to maturity, Loans
that are LIBOR Loans shall bear interest at the LIBOR Rate plus the Applicable
Margin, and Loans that are Base Rate Loans shall bear interest at the Base Rate
plus the Applicable Margin.
(b) The Applicable Margin shall be determined by the
Administrative Agent quarterly, and upon the making of each Loan and issuance of
each Letter of Credit in an amount in excess of $5,000,000, based on the
financial statements and the Compliance Certificate delivered to the Banks
pursuant to Sections 7.5(b) and (d) (in the case of a quarterly determination)
and the compliance certificate delivered pursuant to Section 6.8(c) (in the case
of determination of the Applicable Margin upon the making of a Loan or issuance
of a Letter of Credit). Any change in the interest rate on the Loans due to a
change in the Applicable Margin shall be effective on the fifth Banking Day
after delivery of such financial statements or compliance certificate; provided,
however, that if any such quarterly financial statements and compliance
certificate indicate an increase in the Applicable Margin and such financial
statements and certificate are not provided within the time period required in
Section 7.5(b), the increase in the interest rate due to such change in the
Applicable Margin shall be effective retroactively as of the fifth Banking Day
after the date on which such financial statements and certificate were due.
Until delivery of financial statements for the first fiscal quarter of the
Borrower ending after the Closing, for purposes of calculating the Applicable
Margin, the Leverage Ratio shall be determined, after giving effect to the Loans
made on and after the Closing Date, from the certificate delivered to the
Administrative Agent pursuant to Section 6.8(c). The Borrower shall deliver to
the Banks with each set of quarterly financial statements which indicate a
change in the Applicable Margin a notice with respect to such change, which
notice shall set forth the calculation of, and the supporting evidence for, such
change.
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53
(c) Upon the occurrence of any Event of Default, the
entire outstanding principal amount of each Loan and (to the extent permitted by
law) unpaid interest thereon and all other amounts due hereunder shall bear
interest from the date of occurrence of such Event of Default until the earlier
of the date such Loan is paid in full and the date on which such Event of
Default is cured or waived in writing at the Default Interest Rate which shall
be payable upon demand.
(d) Interest shall be computed on a Three Hundred Sixty
day year basis calculated for the actual number of days elapsed. Interest
accrued on each Base Rate Loan shall be paid quarterly in arrears on each
Quarterly Date after the date hereof until such Loan is paid in full, and
interest accrued on each LIBOR Loan shall be paid on the last day of the
Interest Period thereof and, in addition, if such Interest Period is more than
three months, on the day that would have been the last day of such Interest
Period if such Interest Period had been three months.
(e) The rate of interest payable on any Note from time to
time shall in no event exceed the maximum rate, if any, permissible under
applicable law. If the rate of interest payable on any Note is ever reduced as a
result of the preceding sentence and any time thereafter the maximum rate
permitted by applicable law shall exceed the rate of interest provided for on
such Note, then the rate provided for on such Note shall be increased to the
maximum rate permitted by applicable law for such period as is required so that
the total amount of interest received by the holder of such Note is that which
would have been received by such holder but for the operation of the preceding
sentence.
3.2 Manner of Payments.
(a) Prior to each Quarterly Date and the end of each
Interest Period, the Administrative Agent shall render a statement to the
Borrower of all amounts due to the Banks for principal, interest and fees
hereunder. All amounts listed on each such statement shall be due and payable on
the Quarterly Date or, for LIBOR Loans, the last day of such Interest Period, in
respect of which such statement was sent. As to all other Obligations which
become due and payable other than on a fixed
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54
date by their terms, the Administrative Agent shall advise the Borrower by a
written statement that they are due and payable, and the Borrower shall pay the
same within five days of receipt of such statement. Any failure by the
Administrative Agent to render any such statement or give any such advice shall
in no way relieve the Borrower of any liability for or obligation to pay any
amount due and payable hereunder.
(b) Whenever any payment to be made hereunder, including
without limitation any payment to be made on a Note, shall be stated to be due
on a day which is not a Banking Day, such payment may be made on the next
succeeding Banking Day, and such extension of time shall in each case be
included in the computation of the interest payable on such Note.
(c) Unless otherwise provided in this Agreement, all
payments or prepayments made or due hereunder or under the Notes shall be made
in immediately available funds by federal funds wire transfer, and without
setoff, deduction or counterclaim, to the Administrative Agent prior to 11:00
A.M., Cleveland time, on the date when due, at its offices at 000 Xxxxxx Xxxxxx,
Xxxxxxxxx, Xxxx 00000, or at such other place as may be designated by the
Administrative Agent. Funds received after 1:00 P.M., Cleveland time, shall be
deemed to have been received on the next Banking Day. To the extent any such
payment is made for the ratable benefit of the Banks, the Administrative Agent
shall promptly distribute such payment to the Banks in accordance with their
respective Ratable Shares.
SECTION 4 CLOSING.
The closing of the transactions contemplated by this Agreement shall
take place at the offices of the Administrative Agent at 000 Xxxxxx Xxxxxx,
Xxxxxxxxx, Xxxx 00000 on or about February 13, 1998, or such other date and
place as to which the parties may agree (the "Closing" and the "Closing Date").
Subject to the terms and conditions hereof, upon the fulfillment or waiver in
writing of all the conditions precedent set out in Section 6 below, and the
delivery to the Administrative Agent of the Notes, the Banks shall make such
Loans as the Borrower may request.
SECTION 5 REPRESENTATIONS AND WARRANTIES OF THE BORROWER.
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55
To induce the Banks to enter into this Agreement and to make the Loans,
the Borrower represents and warrants as follows:
5.1 Organization and Powers.
(a) The Borrower is a corporation, duly organized,
validly existing and in good standing under the laws of the Commonwealth of
Pennsylvania. The Borrower is duly qualified or registered to conduct business
and in good standing under the laws of each other jurisdiction in which the
character of its business or the ownership of its assets makes such
qualification or registration necessary, except where failure to so qualify or
register could not reasonably be expected to have a Material Adverse Effect. The
Borrower has all requisite power and authority to own and operate its
properties, to carry on its business as now conducted and proposed to be
conducted, to enter into and perform the Acquisition Agreements, this Agreement,
the Collateral Documents to which it is a party and all other documents to be
executed by it in connection with the transactions contemplated hereby and
thereby, to acquire the additional Stations pursuant to the Acquisition
Agreements and to carry out the terms hereof and thereof.
(b) As of the date hereof, the Borrower has no
Subsidiaries other than the License Partnership. The License Partnership is a
limited partnership, duly organized, validly existing and in good standing under
the laws of the Commonwealth of Pennsylvania and is duly qualified and in good
standing under the laws of each other jurisdiction in which the character of its
business or the ownership of its assets makes such qualification or registration
necessary. All of the Licenses issued by the FCC in connection with the
ownership and operation of the Stations, including the Stations being acquired
pursuant to the Acquisition Agreements, have been, or at the closing under the
respective Acquisition Agreements will be, duly assigned to the License
Partnership. The Borrower is the sole general partner of the License Partnership
with a 99% partnership interest. ECI Investors Corporation, a Delaware
corporation, is the sole limited partner of the License Partnership with a 1%
partnership interest. The License Partnership has no assets, other than Licenses
relating to the Stations and the Management Agreement, has no commitments,
obligations or liabilities (other than
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obligations under the Management Agreement), has no employees and engages in no
business (except pursuant to the Management Agreement).
5.2 Authorization. All necessary corporate, partnership,
shareholder or other actions on the part of the Borrower and its Subsidiaries to
authorize the execution and delivery of the Acquisition Agreements, this
Agreement and the Collateral Documents and the performance of the respective
obligations of the Borrower and its Subsidiaries herein and therein have been
taken. The Acquisition Agreements, this Agreement and each Collateral Document
are valid and legally binding upon each of the Borrower and its Subsidiaries, to
the extent it is a party thereto, and enforceable in accordance with their
respective terms, except to the extent that the enforceability hereof and
thereof may be limited by bankruptcy, insolvency or like laws affecting
creditors rights generally and by the application of general equitable
principles.
5.3 Financial Statements. Exhibit B attached hereto contains (a)
the audited consolidated financial statements of the Borrower and its
Subsidiaries for the fiscal years ending September 30, 1995, September 30, 1996,
and September 30, 1997, and (b) the unaudited consolidated financial statements
of the Borrower and its Subsidiaries as of December 31, 1997, and for the three
month period then ended (the "Financial Statements"). The Financial Statements
are true and complete in all material respects (including, without limitation, a
disclosure of all material contingent liabilities) and present fairly the
financial condition and results of operations of the Borrower and its
Subsidiaries, as of the dates and for the periods indicated and have been
prepared in accordance with GAAP, subject in the case of statements for interim
periods to normal year-end adjustments and the absence of footnotes.
5.4 Projections. Exhibit C attached hereto contains the Borrower's
projections for the fiscal years 1998 through 2005. Such projections were
prepared by the Borrower in good faith on the basis of assumptions the Borrower
believes were reasonable in light of the conditions existing at the time of
preparation thereof and remain reasonable as of the date hereof, and as of the
date hereof there are no facts which are known to the
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Borrower which the Borrower believes would cause a material adverse change in
such projections.
5.5 Capitalization of the Borrower and its Subsidiaries. The
capitalization of the Borrower and the License Partnership as of the Closing
Date is as set forth on Exhibit D attached hereto. All of the issued and
outstanding capital stock of the Borrower has been duly and validly issued and
is fully paid and nonassessable. None of the capital stock of the Borrower has
been issued in violation of the Securities Act of 1933, as amended, or the
securities or "Blue Sky" or any other applicable laws, rules or regulations of
any applicable jurisdiction. Except as set forth on Exhibit D, as of the Closing
Date, neither the Borrower nor any of its Subsidiaries has any commitment or
obligation, either firm or conditional, to issue, deliver, purchase or sell,
under any offer, option agreement, bonus agreement, purchase plan, incentive
plan, compensation plan, warrant, conversion rights, contingent share agreement,
shareholders agreement, partnership agreement or otherwise, any shares of its
capital stock, partnership interests or other equity securities or securities
convertible into shares of capital stock, partnership interests or other equity
securities.
5.6 Title to Properties; Patents, Trademarks, Etc. The Borrower
and each of its Subsidiaries have, and will have after giving effect to the
closings under the Acquisition Agreements, good and marketable title to all of
their assets, whether real or personal, tangible or intangible, free and clear
of any Liens or adverse claims, except Permitted Liens. The Borrower and each of
its Subsidiaries own or possess, and will own or possess after giving effect to
the closings under the Acquisition Agreements, the valid right to use all the
patents, patent applications, patent and know-how licenses, inventions,
technology, permits, trademark registrations and applications, trademarks,
service marks, trade names, copyrights, product designs, applications, formulae,
processes, circulation, and other subscriber lists, industrial property rights
and licenses and rights in respect of the foregoing used or necessary for the
conduct of its business (collectively, "proprietary rights"). The Borrower is
not aware of any existing or threatened infringement or misappropriation of (a)
any such proprietary rights of others by the Borrower or any of its Subsidiaries
or (b) any proprietary rights of the Borrower or any of its Subsidiaries by
others.
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5.7 Litigation; Proceedings. Except as disclosed on Exhibit E
attached hereto, there is no action, suit, complaint, proceeding, inquiry or
investigation at law or in equity, or by or before any court or governmental
instrumentality or agency, nor any order (including, without limitation, any
order to show cause or order of forfeiture), decree or judgment in effect,
pending or, to the best of the Borrower's knowledge, threatened against or
affecting the Borrower, any of its Subsidiaries, any Station or any of the
properties or rights relating to any Station which could reasonably be expected
to have a Material Adverse Effect. No Person has filed or, to the best of the
Borrower's knowledge, threatened to file, any material competing application,
petition to deny or other opposition against any application, including any
renewal application, filed or to be filed by the Borrower or any of its
Subsidiaries.
5.8 Taxes. Except as disclosed on Exhibit E attached hereto, all
Federal, state and local tax returns, reports and statements (including, without
limitation, those relating to income taxes, withholding, social security and
unemployment taxes, sales and use taxes, and franchise taxes) required to be
filed by the Borrower or any of its Subsidiaries have been properly filed with
the appropriate governmental agencies in all jurisdictions in which such
returns, reports and statements are required to be filed, which returns, reports
and statements are complete and accurate, and all taxes and other impositions
due and payable have been timely paid prior to the date on which any fine,
penalty, interest, late charge or loss may be added thereto for non-payment
thereof except where contested in good faith and by appropriate proceedings. As
of the Closing Date, neither the Borrower nor any of its Subsidiaries has filed
with the Internal Revenue Service or any other governmental authority any
agreement or other document extending or having the effect of extending the
period for assessment or collection of any Federal, state, local or foreign
taxes or other impositions. All tax deficiencies asserted or assessments made as
a result of any examinations conducted by the Internal Revenue Service or any
other governmental authority relating to the Borrower or any of its Subsidiaries
have been fully paid or are being contested in accordance with the provisions of
Section 7.4. Proper and accurate amounts have been withheld by the Borrower and
its Subsidiaries from its employees for all periods to fully comply
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with the tax, social security and unemployment withholding provisions of
applicable Federal, state, local and foreign law. The charges, accruals and
reserves on the books of the Borrower and its Subsidiaries in respect of any
taxes or other governmental charges are adequate.
5.9 Absence of Conflicts. The execution, delivery and performance
of the Acquisition Agreements, this Agreement and the Collateral Documents and
all actions and transactions contemplated hereby and thereby will not (a)
violate, be in conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under (i) any provision of the
Articles of Incorporation or By-Laws or any shareholders agreement or other
organizational document of the Borrower or any of its Subsidiaries or the
Certificate of Limited Partnership or the Limited Partnership Agreement of the
License Partnership, (ii) any arbitration award or any order of any court or of
any other governmental agency or authority binding on the Borrower or any of its
Subsidiaries, (iii) any License of the Borrower or any of its Subsidiaries or
under which the Borrower or any of its Subsidiaries operates or will operate
after giving effect to the closings under the Acquisition Agreements, (iv) any
applicable law, rule, order or regulation (including without limitation, (A) the
Communications Act of 1934, as amended, (B) any law, rule, regulation or policy
of the FCC or any other Licensing Authority or (C) regulations G, T, U or X of
the Board of Governors of the Federal Reserve System) or (v) any Operating
Agreement, the Subordinated Purchase Agreement or other material agreement,
instrument or document relating to a Station or to which the Borrower or any of
its Subsidiaries is a party, or by which the Borrower or any of its Subsidiaries
or any of their properties is bound, or (b) result in the creation or imposition
of any Lien of any nature whatsoever, other than those Liens arising hereunder
or under the Collateral Documents, upon any of the properties of the Borrower or
any of its Subsidiaries.
5.10 Indebtedness. As of the Closing Date, the Borrower has no
Indebtedness of any nature, whether due or to become due, absolute, contingent
or otherwise, including Indebtedness for taxes and any interest or penalties
relating thereto, which exceeds in the aggregate, $150,000, except (a) the
liability to pay legal and accounting fees and reasonable closing expenses in
connection with this Agreement and the Acquisition Agreements,
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(b) the Obligations, (c) Indebtedness incurred in the ordinary course of
business since September 30, 1997, (d) as disclosed in the Financial Statements,
and (e) as disclosed on Exhibit F attached hereto. The License Partnership has
no Indebtedness of any nature, whether due or to become due, absolute,
contingent or otherwise, including Indebtedness for taxes and any interest or
penalties relating thereto, except for the obligations arising under the
Management Agreement.
5.11 Compliance. Except as disclosed in Exhibit E attached hereto,
neither the Borrower nor any of its Subsidiaries nor the ownership, construction
or operation of any Station is in material violation of any License or any
statute, ordinance, law, rule, regulation or order of the United States of
America or the FCC (including, without limitation, applicable federal laws and
the rules, regulation, policies and orders of the FCC relating to foreign
ownership restrictions or to limitations on the nature and number of media
outlets that may be held under common ownership or control), the Federal
Aviation Administration or any other federal, state, county, municipal or other
governmental agency or authority applicable to the Borrower or any of its
Subsidiaries, their properties, the ownership, construction or operation of any
Station or the conduct of their business. Neither the Borrower nor any of its
Subsidiaries nor the ownership, construction or operation of any Station is in
violation or has breached in any material respect the provisions of the
Subordinated Purchase Agreement or any indenture, License, Operating Agreement,
note, lease or other instrument or document to which it is a party or by which
it is bound, nor does there exist any material default, or any event or
condition which, upon notice or lapse of time, or both, would become a material
default, under the Subordinated Purchase Agreement or any such indenture,
License, Operating Agreement, note, lease, or other instrument or document. The
Borrower and each of its Subsidiaries have the legal right and authority to
conduct their respective businesses as now conducted or proposed to be
conducted.
5.12 Statements Not Misleading. No statement, representation or
warranty made by the Borrower or any of its Subsidiaries in or pursuant to this
Agreement or the Schedules or Exhibits attached hereto or any of the Collateral
Documents contains any untrue statement of a material fact, nor omits to
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state a material fact necessary to make such statement not misleading in light
of the circumstances under which such statement was made, or otherwise violates
any federal or state securities laws, rules or regulations. There is no fact
known to the Borrower (other than matters of a general economic nature or
relating to the broadcasting industry generally or matters reflected in the
audited financial statements contained in Exhibit B attached hereto or otherwise
disclosed herein) that has had or could reasonably be expected to have a
Material Adverse Effect.
5.13 Consents or Approvals. No consent, approval or authorization
of, or filing, registration or qualification with, any governmental authority or
any other Person (including, without limitation, the FCC and any other Licensing
Authority) is required to be obtained by the Borrower or any of its Subsidiaries
in connection with the execution, delivery or performance of the Acquisition
Agreements or this Agreement or any of the Collateral Documents, including
without limitation, in connection with the granting of Liens in the Borrower's
partnership interest in the License Partnership or in the capital stock or the
assets of the Borrower and its Subsidiaries, which has not already been obtained
or completed, except for (a) the filing with the FCC of this Agreement and
certain of the Collateral Documents pursuant to FCC rules, which shall be
accomplished within the required time period after the Closing, (b) the filing
of financing statements and other actions expressly required to be taken
pursuant to the Collateral Documents, (c) the consent of the FCC to the extent
required in connection with the exercise by the Administrative Agent or the
Banks of their rights and remedies hereunder or under the Collateral Documents
and (d) the consent of the FCC to the consummation of the Acquisition
Agreements.
5.14 Material Contracts and Commitments. Exhibit G attached hereto
contains a true and complete description of all material contracts and
commitments of the Borrower or any of its Subsidiaries or which relate to a
Station, as of the Closing Date, whether oral or written, including, without
limitation, (a) any security agreement, pledge agreement, mortgage or guaranty;
(b) any material management, construction supervision, service or employment
agreements, conditional sale contract or lease of personal property which
involves expenditures in excess of
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$1,000,000 in any single case; (c) any collective bargaining agreement; (d) any
material contract or commitment for the future purchase or sale of goods which
involves expenditures in excess of $1,000,000 in any single case; (e) any
contract or commitment which involves a material Capital Expenditure in excess
of $1,000,000 in any single case; (f) all Licenses; and (g) all Operating
Agreements. To the best of the Borrower's knowledge, except as disclosed on
Exhibit G, as of the Closing Date, all of the items listed on Exhibit G are in
full force and effect without material default. Exhibit G further identifies
each such contract which requires consent to the granting of a Lien in favor of
the Administrative Agent for the benefit of the Banks on the rights of the
Borrower or its Subsidiaries under such contract. The Borrower has made
available to the Administrative Agent true and complete copies of each of the
above.
5.15 Employee Benefit Plans. Exhibit H contains a true and complete
list of all Plans maintained by the Borrower or any member of the Controlled
Group. Neither the Borrower nor any member of the Controlled Group has or will
have, as of the closings under the Acquisition Agreements, any liability, or
reasonably anticipates any liability, of any kind (other than current expenses
incurred in the ordinary course of business) in excess, in the aggregate, of
$150,000, to or in respect of any Plan or Benefit Arrangement, which liability
is not reflected in the financial statements included in Exhibit B attached
hereto. With respect to the Plans and Benefit Arrangements maintained by the
Borrower or any member of the Controlled Group: (a) each Plan that is intended
to be qualified under Code Section 401(a) is so qualified and has been so
qualified since its adoption, and each trust forming a part thereof is exempt
from tax under Code Section 501(a); (b) each Plan complies in all material
respects with all applicable requirements of law, has been administered in
accordance with its terms and all required contributions have been made; (c)
neither the Borrower nor any member of the Controlled Group knows or has reason
to know that the Borrower or any member of the Controlled Group has engaged in a
transaction which would subject it to any material tax, penalty or liability
under ERISA or the Code for any prohibited transaction; (d) no Plan is subject
to the minimum funding requirements under ERISA Section 302 or Code Section 412,
is a multiemployer plan (as defined in ERISA Section 4001(a)(3)), is a defined
benefit plan (as defined under ERISA Section 3(35) or Code Section 414(j)), or
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is a multiple employer plan (as defined in ERISA Section 4063). No Plan or
Benefit Arrangement maintained by the Borrower or any member of the Controlled
Group is a multiple employer welfare arrangement (as defined in ERISA Section
3(40)).
5.16 Licenses and Operating Agreements. The Licenses and Operating
Agreements shown on Exhibit G constitute all of the Licenses and Operating
Agreements which, as of the Closing Date, are necessary for the lawful
ownership, construction or operation of the Stations and of the other businesses
of the Borrower and its Subsidiaries in the manner and to the full extent they
are currently owned, constructed or operated. Exhibit G sets forth a correct and
complete list, as of the Closing Date, of the expiration date of each License
and of each pending application for a License. Except as specified on Exhibit G,
all of the Licenses relating to the Stations and all other Licenses of the
Borrower and its Subsidiaries have been duly and validly issued or assigned to
and are legally held by the Borrower or one of its Subsidiaries and are in full
force and effect without condition except those of general application. All such
Licenses have been issued in compliance with all applicable laws and
regulations, are legally binding and enforceable in accordance with their terms
and are in good standing. Except as set forth on Exhibit E, the Borrower knows
of no facts or conditions which would constitute grounds for any Licensing
Authority to deny any pending application for a License, to suspend, revoke,
materially adversely modify, designate for a hearing, annul, fail to renew on or
before its renewal date, or renew for less than a full license period any
License or to impose a material financial penalty on the Borrower or any of its
Subsidiaries.
5.17 Material Restrictions. Except as set forth in Exhibit M
attached hereto, neither the Borrower nor any of its Subsidiaries is a party to
any agreement or other instrument or subject to any other restriction which has
had or could reasonably be expected to have a Material Adverse Effect.
5.18 Investment Company Act. The Borrower (a) is not an investment
company as that term is defined in the Investment Company Act of 1940, as
amended, (b) does not directly or indirectly control, and is not directly or
indirectly controlled by, a company which is an investment company as that term
is
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defined in such act and (c) is not otherwise subject to regulation under such
act.
5.19 Absence of Material Adverse Effect. No Material Adverse Effect
has occurred since September 30, 1997.
5.20 Defaults. No Possible Default or Event of Default now exists
or will exist upon the making of any Loan.
5.21 Real Estate. Exhibit I attached hereto lists all real estate
owned as of the Closing Date by the Borrower or any of its Subsidiaries and all
leases pursuant to which the Borrower or any of its Subsidiaries has acquired,
as of the Closing Date, a leasehold interest in real estate. Exhibit I lists the
use of such owned and leased property in the Borrower's or its Subsidiary's
operations.
5.22 Securities Laws. No proceeds of any Loan will be used by the
Borrower or any of its Subsidiaries to acquire any security in any transaction
which is subject to Section 13 or 14 of the Securities Exchange Act of 1934, as
amended. Neither the registration of any security under the Securities Act of
1933, as amended, or the securities laws of any state, nor the qualification of
an indenture in respect thereof under the Trust Indenture Act of 1939, as
amended, is required in connection with the consummation of this Agreement or
the Acquisition Agreements or the execution and delivery of the Notes.
5.23 Insurance. All policies of insurance of any kind or nature
owned by or issued to the Borrower or any of its Subsidiaries are in compliance
with the requirements of Section 7.3 and are in full force and effect. In the
past three years neither the Borrower nor any of its Subsidiaries has been
refused insurance for which it applied or had any policy of insurance terminated
(except at its own request).
5.24 Labor Matters. Except as set forth in Exhibit N attached
hereto, there are no material strikes, unfair labor practice charges or other
material labor disputes or grievances pending or, to the best of the Borrower's
knowledge, threatened against the Borrower, any of its Subsidiaries or any
Station. The Borrower has not received any written complaints or knowledge of
any threatened complaints, nor to the best of the Borrower's
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knowledge, are any such complaints on file with any Federal, state or local
governmental agency, alleging employment discrimination by the Borrower or any
of its Subsidiaries or in connection with any Station which would, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
All payments due under any collective bargaining agreement to which the Borrower
or any of its Subsidiaries is a party have been paid or accrued as a liability
on the books of the Borrower or such Subsidiary.
5.25 Environmental Compliance.
Except as set forth in Exhibit J attached hereto and giving effect to
the consummation of the Acquisition Agreements:
(a) The Borrower and each of its Subsidiaries have
obtained all material permits, licenses and other authorizations which are
required under all Environmental Laws. The Borrower and each of its Subsidiaries
is in material compliance with all terms and conditions of all such permits,
licenses and authorizations and are also in material compliance with all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in any applicable Environmental
Law or in any regulation, code, plan, order, decree, judgment, injunction,
notice or demand letter issued, entered, promulgated or approved thereunder,
including, without limitation, all Environmental Laws in all jurisdictions in
which the Borrower or such Subsidiary owns or operates a Station, a facility or
site, arranges or has arranged for disposal or treatment of Hazardous Materials,
solid waste or other wastes, accepts or has accepted for transport any Hazardous
Materials, solid waste or other wastes or holds or has held any interest in real
property or otherwise.
(b) No material Environmental Claim has been issued, no
complaint has been filed, no penalty has been assessed and no litigation,
proceeding, investigation or review is pending or, to the best of the Borrower's
knowledge, threatened by any Person with respect to any alleged failure by the
Borrower, any of its Subsidiaries or any property owned by the Borrower or any
Subsidiary to comply with any Environmental Law or to have any permit, license
or authorization required in connection with the conduct of the business of the
Borrower or any of its
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66
Subsidiaries or with respect to any generation, treatment, storage, recycling,
transportation, use, disposal or Release of any Hazardous Materials generated by
the Borrower or any of its Subsidiaries or with respect to any real property in
which the Borrower or any of its Subsidiaries holds or has held an interest or
any past or present operation of the Borrower or any of its Subsidiaries.
(c) There are no Environmental Laws requiring any
material work, repairs, construction, Capital Expenditures or other remedial
work of any nature whatsoever, with respect to any real property in which the
Borrower or any of its Subsidiaries holds or has held an interest or any past or
present operation of the Borrower or any Subsidiary.
(d) Neither the Borrower nor any of its Subsidiaries has
handled any Hazardous Material, on any property now or previously owned or
leased by the Borrower or any of its Subsidiaries to an extent that it has, or
could reasonably be expected to have, a Material Adverse Effect.
(e) To the best of the Borrower's knowledge:
(i) no PCBs or asbestos is present at any
property now or previously owned or any premises now or previously leased by the
Borrower or any of its Subsidiaries;
(ii) no underground storage tanks for Hazardous
Materials, active or abandoned, are now or were previously operated at any
property now or previously owned by the Borrower or any of its Subsidiaries,
and, with respect to premises now or previously leased by the Borrower or any of
its Subsidiaries, no underground storage tanks for Hazardous Materials, active
or abandoned, are now or were previously operated by the Borrower or any of its
Subsidiaries;
(iii) no Hazardous Materials have been Released,
in a reportable quantity, where such a quantity has been established by statute,
ordinance, rule, regulation or order, at, on or under any property now or
previously owned by the Borrower or any of its Subsidiaries; and
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(iv) no Hazardous Materials have been otherwise
Released at, on or under any property now or previously owned or any premises
now or previously leased by the Borrower or any of its Subsidiaries to an extent
that it has, or could reasonably be expected to have, a Material Adverse Effect.
(f) Neither the Borrower nor any of its Subsidiaries has
transported or arranged for the transportation of any Hazardous Material to any
location that is listed on the National Priorities List ("NPL") under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended ("CERCLA"), listed for possible inclusion on the NPL by the
Environmental Protection Agency in the Comprehensive Environmental Response and
Liability Information System, as provided for by 40 C.F.R. Section 300.5
("CERCLIS"), or on any similar state or local list or that is the subject of
Federal, state or local enforcement actions or other investigations that may
lead to Environmental Claims against the Borrower or any of its Subsidiaries.
(g) No Hazardous Material generated by the Borrower or
any of its Subsidiaries has been recycled, treated, stored, disposed of or
Released by the Borrower or any of its Subsidiaries at any location.
(h) No oral or written notification of a Release of a
Hazardous Material has been filed by or on behalf of the Borrower or any of its
Subsidiaries and no property now or previously owned or premises leased by the
Borrower or any of its Subsidiaries is listed or proposed for listing on the
National Priorities list promulgated pursuant to CERCLA, on CERCLIS or on any
similar state list of sites requiring investigation or clean-up.
(i) There are no Liens arising under or pursuant to any
Environmental Laws on any of the property owned or premises leased by the
Borrower or any of its Subsidiaries, and no government actions have been taken
or are in process which could subject any of such property to such Liens, and
neither the Borrower nor any of its Subsidiaries would be required to place any
notice or restriction relating to the presence of Hazardous Materials at any
property owned by it in any deed to such property.
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(j) Neither the Borrower nor any of its Subsidiaries has
retained or assumed any liabilities (contingent or otherwise) in respect of any
Environmental Claims under the terms of any contract or agreement or by
operation of law as a result of the sale of assets or stock.
(k) There have been no environmental investigations,
studies, audits, tests, reviews or other analyses conducted by or which are in
the possession of the Borrower or any of its Subsidiaries in relation to any
property or facility now or previously owned or leased by the Borrower or such
Subsidiary which have not been made available to the Banks.
5.26 Solvency. The Borrower has received, or has the right
hereunder to receive, consideration which is the reasonable equivalent value of
the obligations and liabilities that the Borrower has incurred to the Banks. The
Borrower is not insolvent as defined in Section 101 of Title 11 of the United
States Code or any applicable state insolvency statute, nor, after giving effect
to the consummation of the transactions contemplated herein and in the
Acquisition Agreements, will the Borrower be rendered insolvent by the execution
and delivery of this Agreement, the Notes or the Collateral Documents to the
Banks. The Borrower is not engaged or about to engage in any business or
transaction for which the assets retained by it shall be an unreasonably small
capital, taking into consideration the obligations to the Banks incurred
hereunder. The Borrower does not intend to, nor does it believe that it will,
incur debts beyond its ability to pay them as they mature.
5.27 Subordinated Purchase Agreement. There has been no amendment
to, or waiver of any provision of, the Subordinated Purchase Agreement since
August 1, 1996. No default has occurred under the Subordinated Purchase
Agreement or will exist after giving effect to the execution, delivery and
performance of this Agreement.
SECTION 6 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE BANKS.
The obligations of the Banks to make any Loan and to issue any Letter
of Credit and the performance by the Banks of the other actions to be taken by
them on or after the Closing Date
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are subject to the fulfillment or waiver in writing of each of the following
conditions precedent. The Borrower shall deliver to the Administrative Agent
copies for each Bank of each document, instrument or other item to be delivered
pursuant to this Section 6.
6.1 Compliance. All of the representations and warranties of the
Borrower and its Subsidiaries herein and in the Collateral Documents shall be
true in all material respects on and as of the Closing Date, the date of
issuance of any Letter of Credit and the date of any subsequent Loan (other than
a Loan resulting from the funding of a Letter of Credit), as if made on and as
of such date (except to the extent that such representations and warranties
expressly relate to an earlier date, in which case such representations and
warranties shall be true in all material respects as of such earlier date) both
before and after giving effect to the making of the proposed loan or the
issuance of the proposed Letter of Credit. The Borrower and its Subsidiaries
shall have performed and shall be in compliance with all the provisions of this
Agreement and each Collateral Document, and no Possible Default or Event of
Default shall have occurred and be continuing, on and as of the Closing Date and
the date of any subsequent Loan (other than a Loan resulting from the funding of
a Letter of Credit) or the issuance of a Letter of Credit, before and after
giving effect to the making of the proposed Loan or the issuance of the proposed
Letter of Credit. On the Closing Date and on the date of each subsequent Loan
(other than a Loan resulting from the funding of a Letter of Credit) and the
date of issuance of any Letter of Credit, the Borrower shall deliver to the
Banks a certificate, dated as of such date, and signed by an executive officer
of the Borrower, certifying compliance with the conditions of this Section 6.1.
Each request by the Borrower for a Loan shall, in and of itself, constitute a
representation and warranty that the Borrower, as of the date of such Loan, is
in compliance with this Section.
6.2 Security Agreements. The Borrower shall have executed and
delivered to the Administrative Agent a Security Agreement in form and substance
satisfactory to the Administrative Agent (the "Borrower Security Agreement"),
granting to the Administrative Agent, for the benefit of the Banks, a first
priority security interest in substantially all of the Borrower's personal
property; and the Borrower Security Agreement, and the security
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interests granted pursuant thereto, shall be in full force and effect. The
License Partnership shall have executed and delivered to the Administrative
Agent a Security Agreement in form and substance satisfactory to the
Administrative Agent (the "Subsidiary Security Agreement"), granting to the
Administrative Agent, for the benefit of the Banks, a first priority security
interest in substantially all of the License Partnership's personal property;
and the Subsidiary Security Agreement, and the security interests granted
pursuant thereto, shall be in full force and effect.
6.3 Pledge Agreements.
(a) All of the stockholders of the Borrower shall have
executed and delivered to the Administrative Agent a Pledge Agreement in form
and substance satisfactory to the Administrative Agent (the "Borrower Pledge
Agreement"), granting to the Administrative Agent, for the benefit of the Banks,
a first priority security interest in all of the issued and outstanding capital
stock of the Borrower; such stockholders shall have delivered to the
Administrative Agent stock certificates evidencing all of such capital stock and
stock powers, duly endorsed in blank, with respect thereto; the Borrower and
such stockholders shall have taken all other actions as may be required to
effect the grant and perfection of the Administrative Agent's security interest
in such capital stock; and the Borrower Pledge Agreement, and the security
interests granted pursuant thereto, shall be in full force and effect.
(b) The Borrower shall have executed and delivered to the
Administrative Agent a Pledge Agreement in form and substance satisfactory to
the Administrative Agent (together with any pledge agreements executed and
delivered pursuant to Section 8.10(b) or (c), collectively, the "Subsidiary
Pledge Agreements"), granting to the Administrative Agent, for the benefit of
the Banks, a first priority security interest in all of the issued and
outstanding partnership interests in the License Partnership held by the
Borrower; the Borrower shall have taken all actions as may be required to effect
the grant and perfection of the Administrative Agent's security interest in such
partnership interests; and such Subsidiary Pledge Agreement, and the security
interests granted pursuant thereto, shall be in full force and effect.
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6.4 Financing Statements. Any financing statements required by the
Security Agreements and the Pledge Agreements shall have been filed for record
with the appropriate governmental authorities.
6.5 Subsidiary Guaranty. The License Partnership shall have
executed and delivered to the Administrative Agent, for the benefit of the
Banks, a guaranty (the "Guaranty"), in form and substance satisfactory to the
Administrative Agent, pursuant to which the License Partnership shall guarantee
the Obligations of the Borrower to the Banks.
6.6 Opinion of Borrower's Counsel. On the Closing Date, the
Administrative Agent shall have received the favorable written opinions of
general counsel to the Borrower and the Subsidiaries, of Pennsylvania counsel to
the Borrower and the Subsidiaries and of FCC counsel to the Borrower and the
Subsidiaries, in each case dated the Closing Date, addressed to the Banks and in
form and substance satisfactory to the Administrative Agent.
6.7 Consummation of Acquisition Agreements. On or prior to the
date on which any Loan is made hereunder the proceeds of which will be used to
pay any part of the purchase price of a Permitted Acquisition, the Borrower
shall have delivered to the Administrative Agent a certified copy of the
Acquisition Agreement, and of all agreements, documents and instruments entered
into in connection therewith, relating to such Permitted Acquisition. The
transactions contemplated by such Acquisition Agreement shall have been
consummated, or shall be consummated simultaneously with the making of such
Loan, without the waiver of any material term or condition by any party thereto,
and, except as expressly permitted by the Administrative Agent, the FCC consent
to the assignment of the FCC Licenses relating to Stations being acquired
pursuant to such Permitted Acquisition shall have become a Final Order. Without
limiting the foregoing sentence, the Borrower or a Subsidiary of the Borrower
shall have purchased pursuant to such Acquisition Agreement substantially all of
the assets being acquired free and clear of all Liens, except Permitted Liens.
The consummation of the transactions contemplated by such Acquisition Agreement
shall be completed in a manner satisfactory to the Administrative Agent, and the
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Administrative Agent shall have received conformed copies or photocopies of all
documents relating thereto. The Borrower shall use its reasonable best efforts
to cause all opinions and certificates of the seller under such Acquisition
Agreement delivered in connection with such closing to be addressed to the
Banks.
6.8 Financial Information.
(a) Agreed Upon Procedures Report. On or prior to the
date on which any Loan is made hereunder the proceeds of which will be used to
pay any part of the purchase price of a Permitted Acquisition, the purchase
price of which is in excess of $10,000,000, the Borrower shall have delivered to
the Administrative Agent a report, in form and substance satisfactory to the
Administrative Agent relating to the financial condition of the stations being
acquired pursuant to such Permitted Acquisition, signed by an accounting or
consulting firm acceptable to the Administrative Agent and prepared in
accordance with the procedures reasonably requested by the Administrative Agent.
(b) Pro Forma Financial Statements. On the Closing Date,
the Borrower shall have delivered to the Administrative Agent (i) a consolidated
pro forma balance sheet as of December 31, 1997 and income statement, for the
twelve month period then ended, after giving effect to the closing under this
Agreement, which pro forma financial statements may contain certain adjustments
acceptable to the Administrative Agent and described therein and (ii) a
certificate in form and substance satisfactory to the Administrative Agent
showing in detail the calculation of the Applicable Margin (using pro forma
twelve month trailing cash flow as of December 31, 1997) after giving effect to
the closings under this Agreement.
(c) Compliance Certificate. On, or one Banking Day prior
to, the date of each borrowing hereunder of $5,000,000 or more, the date of each
issuance of a Letter of Credit with a stated amount of $5,000,000 or more, and,
to the extent requested by the Administrative Agent, the date of any other
borrowing hereunder or issuance of a Letter of Credit, the Borrower shall have
delivered to the Administrative Agent a pro forma compliance certificate using
the most recently available quarterly financial
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statements in form and substance satisfactory to the Administrative Agent
showing the Leverage Ratio as the date of such borrowing or issuance of a Letter
of Credit and the Borrower's compliance on a pro forma basis with the financial
covenants set forth in Section 8.
(d) Subordinated Purchase Agreement. On the Closing Date,
the Borrower shall have provided to the Administrative Agent evidence
satisfactory to the Administrative Agent that the execution, delivery and
performance of this Agreement and the incurrence of Indebtedness by the Borrower
hereunder are permitted pursuant to Section 7.2(a) and Section 7.7(c) of the
Subordinated Purchase Agreement.
6.9 Borrowing Request. On the date of each Loan, the Borrower
shall have delivered to the Administrative Agent a borrowing request,
substantially in the form attached hereto as Exhibit O, for such Loan in form
and substance satisfactory to the Administrative Agent, setting forth (a) the
application of the proceeds of such Loan, (b) evidence that such application is
permitted pursuant to Section 7.1, (c) the recipient, the amount of the payment
and the wire transfer instructions, and (d) a certificate from a financial
officer of the Borrower, in form and substance acceptable to the Administrative
Agent, that the entire amount of such Loan, together with the aggregate amount
of all outstanding Loans, constitutes "Senior Debt" as that term is defined in
the Subordinated Purchase Agreement.
6.10 Insurance Certificates. On the Closing Date, the Borrower
shall have furnished to the Administrative Agent certificates of insurance
together with copies, if requested by the Administrative Agent, of all policies
or other satisfactory evidence that the insurance required by Section 7.3 is in
full force and effect.
6.11 Corporate and Partnership Documents. On the Closing Date, the
Borrower shall deliver to the Administrative Agent the following:
(a) certificates of good standing for the Borrower and
the License Partnership from the Secretary of State of the Commonwealth of
Pennsylvania and from the Secretary of State of each other state in which the
Borrower or the License Partnership
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is qualified or registered to do business, in each case dated as
of a date as near to the Closing Date as practicable;
(b) a certificate signed by the Secretary or Assistant
Secretary of the Borrower, dated as of the Closing Date, certifying that
attached thereto are true and complete copies of (i) the Articles of
Incorporation and By-Laws of the Borrower, (ii) the Certificate of Limited
Partnership and the Limited Partnership Agreement of the License Partnership;
and (iii) resolutions adopted by the Board of Directors of the Borrower
authorizing the execution, delivery and performance of this Agreement, the
Collateral Documents and the Obligations;
(c) incumbency certificates for the Borrower and the
License Partnership; and
(d) such other documents as any Bank may reasonably
request in connection with the proceedings taken by the Borrower or any of its
Subsidiaries authorizing this Agreement and the Collateral Documents.
6.12 Lien Searches, Consents and Releases of Liens. The
Administrative Agent shall have received: (a) certified copies of UCC, judgment
and tax lien search reports listing all effective financing statements and other
Liens on any of the property of the Borrower or any Subsidiary, (b) consents to
the granting of Liens in all Operating Agreements and other material contracts
and leases of the Borrower and each of its Subsidiaries, which by their terms
require such consent, and (c) releases of any existing Liens encumbering any
assets of the Borrower or any of its Subsidiaries, except for Permitted Liens.
6.13 No Order, Judgment or Decree. No order, judgment or decree of
any court, arbitrator or governmental authority shall purport to enjoin or
restrain the Banks from making the Loans.
6.14 No Material Adverse Effect. There shall have occurred no
Material Adverse Effect since September 30, 1997.
6.15 Fee Letters. The Borrower shall have paid all fees, expenses
and other amounts due pursuant hereto and pursuant to the Fee Letters.
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6.16 Legal Approval. All legal matters incident to this Agreement
and the consummation of the transactions contemplated hereby shall be
satisfactory to Dow, Xxxxxx & Xxxxxxxxx, PLLC, special counsel to the
Administrative Agent.
6.17 Other Documents. The Administrative Agent shall have received
all Collateral Documents duly executed, and each Bank shall have received such
other certificates, opinions, agreements and documents, in form and substance
satisfactory to it, as it may reasonably request.
SECTION 7 AFFIRMATIVE COVENANTS OF THE BORROWER.
The Borrower agrees with the Banks that so long as this Agreement shall
remain in effect or any of the Obligations shall remain unpaid or to be
performed, or any Letter of Credit remains outstanding, it shall perform and
comply with the affirmative covenants contained in this Section.
7.1 Use of Proceeds. The Borrower shall use the proceeds of the
Loans only for the following purposes: (a) to refinance on the Closing Date
existing indebtedness under the Borrower's senior secured credit facility, (b)
to fund draws on the Letters of Credit, (c) to pay all or a portion of the
purchase price of Permitted Acquisitions, (d) for Capital Expenditures, (e) for
Capital Distributions permitted pursuant to Section 8.9, (f) to fund investments
permitted pursuant to Section 8.11(g), and (g) for general corporate and working
capital purposes.
7.2 Continued Existence; Maintenance of Rights and Licenses;
Compliance with Law. The Borrower shall, and shall cause each of its
Subsidiaries to, do or cause to be done all things necessary to preserve, renew
and keep in full force and effect its corporate or partnership existence and its
material rights and Licenses. Without limiting the generality of the foregoing,
the Borrower shall, and shall cause each of its Subsidiaries to, maintain in
full force and effect, until termination in accordance with their respective
terms, any and all Licenses, Operating Agreements and other material contracts
and other rights necessary to operate the Stations, not breach or violate the
same in any material respect, and take all actions which may be required to
comply in all material respects with all applicable laws, statutes, rules,
regulations, orders and decrees
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now in effect or hereafter promulgated by any governmental authority. The
Borrower shall, and shall cause each of its Subsidiaries to, obtain, renew and
extend all of the foregoing rights, Licenses and the like which may be necessary
for the continuance of the operation of the Stations.
7.3 Insurance. The Borrower shall, and shall cause each of its
Subsidiaries to, keep its insurable properties insured to the full replacement
cost thereof at all times by financially sound and reputable insurers reasonably
acceptable to the Administrative Agent, and maintain such other insurance, to
such extent and against such risks, including fire, lightning, vandalism,
malicious mischief, flood (to the extent required by the Administrative Agent,
if any of the Borrower's or any of its Subsidiaries' property is located in an
identified flood hazard area, in which insurance has been made available
pursuant to the National Flood Insurance Act of 1968) and other risks insured
against by extended coverage, as is customary with companies in the broadcasting
business. All such insurance shall be in amounts sufficient to prevent the
Borrower or any of its Subsidiaries from becoming a coinsurer, shall name the
Administrative Agent, for the benefit of the Banks, as loss payee and may
contain loss deductible provisions which shall not exceed $100,000 (or, in the
case of earthquake, flood and windstorm coverage, $250,000). The Borrower shall
maintain, for itself and its Subsidiaries, in full force and effect liability
insurance, business interruption insurance, errors and omissions insurance,
general accident and public liability insurance and all other insurance as is
usually carried by companies engaged in the same or similar businesses similarly
situated against claims for personal or bodily injury, death or property damage
occurring upon, in, about or in connection with the use or operation of any
property or motor vehicles owned, occupied, controlled or used by the Borrower,
its Subsidiaries and their employees or agents, or arising in any other manner
out of the business conducted by the Borrower and its Subsidiaries. All of such
insurance shall be in amounts reasonably satisfactory to the Administrative
Agent and shall be obtained and maintained by means of policies with generally
recognized, responsible insurance companies authorized to do business in such
states as may be necessary depending upon the locations of the Borrower's and
its Subsidiaries' assets and shall name the Administrative Agent, for the
benefit of the Banks, as an additional insured or loss payee, as the case may
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be. The insurance to be provided may be blanket policies. Each policy of
insurance shall be written so as not to be subject to cancellation or
substantial modification without not less than thirty days advance written
notice to the Administrative Agent. The Borrower shall furnish the
Administrative Agent annually with certificates or other evidence satisfactory
to the Administrative Agent that the insurance required hereby has been obtained
and is in full force and effect and, prior to the expiration of any such
insurance, the Borrower shall furnish the Administrative Agent with evidence
satisfactory to the Administrative Agent that such insurance has been renewed or
replaced. The Borrower shall, upon request of the Administrative Agent, furnish
the Administrative Agent such information about such insurance as the
Administrative Agent may from time to time reasonably request.
7.4 Obligations and Taxes. The Borrower shall, and shall cause
each of its Subsidiaries to, pay or perform all of its material Indebtedness and
other material liabilities and obligations in a timely manner in accordance with
normal business practices and with the terms governing the same. The Borrower
shall, and shall cause each of its Subsidiaries to, comply with the terms and
covenants of all material agreements and all material leases of real or personal
property and shall keep them all in full force and effect until termination
thereof in accordance with their respective terms. The Borrower shall, and shall
cause each of its Subsidiaries to, pay and discharge promptly all taxes,
assessments and governmental charges or levies imposed upon it or in respect of
its property before the imposition of any penalty, as well as all lawful claims
for labor, materials, supplies or other matters which, if unpaid, might become a
Lien or charge upon such properties or any part thereof; provided, however, that
neither the Borrower nor any of its Subsidiaries shall be required to pay and
discharge any such tax, assessment, charge, levy or claim so long as (a) the
validity thereof is being contested diligently and in good faith by appropriate
proceedings and the enforcement thereof is stayed, pending the outcome of such
proceedings, (b) the Borrower or such Subsidiary has set aside on its books
adequate reserves in accordance with GAAP with respect thereto, and (c) such
contest will not endanger the Lien of the Administrative Agent or the Banks in
any of the Borrower's or such Subsidiary's assets.
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7.5 Financial Statements and Reports. The Borrower shall, and
shall cause each of its Subsidiaries to, maintain true and complete books and
records of account in accordance with GAAP. The Borrower shall furnish to the
Administrative Agent, for delivery to the Banks, the following financial
statements and projections at the following times:
(a) As soon as available, but in no event later than
ninety days after the end of each fiscal year of the Borrower, the Borrower
shall furnish (i) audited consolidated financial statements, including audited
consolidated balance sheets and income and expense statements, of the Borrower
and its Subsidiaries as of the close of such fiscal year reflecting the results
of their operations during such fiscal year, and a consolidated statement of
cash flows for such fiscal year, together with such additional statements,
schedules and footnotes as are customary in a complete accountant's report; such
financial statements shall be certified by independent certified public
accountants selected by the Borrower and acceptable to the Administrative Agent,
and the opinion of such accountants shall be unqualified; and (ii) a statement
signed by such accountants to the effect that in connection with their
examination of such financial statements they have reviewed the provisions of
this Agreement and have no knowledge of any event or condition which constitutes
an Event of Default or Possible Default or, if they have such knowledge,
specifying the nature and period of existence thereof; provided, however, that
in issuing such statement, such independent accountants shall not be required to
go beyond normal auditing procedures conducted in connection with their opinion
referred to above;
(b) As soon as available, but in no event later than
forty-five days after the end of each fiscal quarter of the Borrower (or, in the
case of the last quarter of the Borrower's fiscal year, sixty days after the end
of such quarter), the Borrower shall furnish unaudited consolidated and
consolidating financial statements, including consolidated and consolidating
balance sheets and income and expense statements, of the Borrower and its
Subsidiaries as of the end of such period reflecting the results of their
operations during such period and for the then elapsed portion of the fiscal
year, and a consolidated statement of cash flows for the portion of the fiscal
year ended with the last day of such quarter; all such financial statements
shall be
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in form and detail satisfactory to the Administrative Agent, and
shall be certified as to accuracy and completeness by a financial
officer of the Borrower;
(c) As soon as available, but in no event later than
forty-five days after the end of each month (or, in the case of the last month
of the Borrower's fiscal year, sixty days after the end of such month), the
Borrower shall furnish unaudited statements of income and expense for each
Station, which shall contain a comparison with the budget or projections for
such period and a comparison to the comparable period for the prior year, and
which shall be certified by a financial officer of the Borrower; such financial
statements for the twelfth month of each fiscal year may be preliminary
statements;
(d) The financial statements required under (a) and (b)
above shall be accompanied by a compliance certificate in the form attached
hereto as Exhibit K of a financial officer of the Borrower (i) setting forth the
computations showing compliance with the financial covenants set forth in
Section 8 below, and (ii) certifying that no Possible Default or Event of
Default has occurred, or if any Possible Default or Event of Default has
occurred, stating the nature thereof and the actions the Borrower intends to
take in connection therewith;
(e) The Borrower shall furnish (i) no later than thirty
days after the commencement of each fiscal year, an annual operating budget or
fiscal projections for such fiscal year, and (ii) promptly upon preparation
thereof, any material revisions of such annual budget or fiscal projections;
(f) Promptly upon their becoming available, the Borrower
shall furnish (i) copies of any periodic or special reports filed by the
Borrower or any of its Subsidiaries with the FCC or any other federal, state or
local governmental agency or authority if such reports indicate any material
change in the ownership of the Borrower or such Subsidiary, or any materially
adverse change in the business, operations, affairs or condition of the Borrower
or such Subsidiary, and (ii) copies of any material notices and other material
communications from the FCC or any other federal, state or local governmental
agency or authority which specifically relate to the Borrower, any of its
Subsidiaries, any Station or any material License, and the
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substance of which relates to a matter that could reasonably be
expected to have a Material Adverse Effect;
(g) The Borrower shall furnish (i) upon request, promptly
after the filing thereof with the Internal Revenue Service, copies of each
annual report with respect to each Plan established or maintained by the
Borrower or any member of the Controlled Group for each plan year, including (A)
where required by law, a statement of assets and liabilities of such Plan as of
the end of such plan year and statements of changes in fund balance and in
financial position, or a statement of changes in net assets available for plan
benefits, for such plan year, certified by an independent public accountant
satisfactory to the Administrative Agent, and (B) if prepared by or available to
the Borrower, an actuarial statement of such Plan applicable to such plan year,
certified by an enrolled actuary of recognized standing acceptable to the
Administrative Agent; and (ii) promptly after receipt thereof, a copy of any
notice the Borrower or a member of the Controlled Group may receive from the
Department of Labor or the Internal Revenue Service with respect to any Plan
(other than notices of general application) which could result in a material
liability to the Borrower; the Borrower will promptly notify the Banks of any
material taxes assessed, proposed to be assessed or which the Borrower has
reason to believe may be assessed against the Borrower or any member of the
Controlled Group by the Internal Revenue Service with respect to any Plan or
Benefit Arrangement; and
(h) Upon the Administrative Agent's written request, such
other information about the financial condition, properties and operations of
the Borrower or any of its Subsidiaries as any Bank may from time to time
reasonably request.
7.6 Notices. The Borrower shall give the Administrative Agent, for
distribution to the Banks, notice (a) within five days after its receipt of
notice thereof, of any action, suit, investigation or proceeding by or against
the Borrower or any of its Subsidiaries, which, if adversely determined, could
reasonably be expected to have a Material Adverse Effect, including, without
limitation, any material admonition, censure or adverse citation or order by the
FCC or any other governmental authority or regulatory agency, (b) within three
days after its receipt of notice thereof, (i) of any action or event
constituting an event of default or violation of the Subordinated
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Purchase Agreement, or any License, Operating Agreement or other material
contract to which the Borrower or any of its Subsidiaries is a party or by which
the Borrower or any such Subsidiary is bound, and (ii) of any competing
application, petition to deny or other opposition to any license renewal
application filed by the Borrower or any of its Subsidiaries with the FCC, if
such event of default, violation or other matter could reasonably be expected to
have a Material Adverse Effect, (c) within three days after its receipt of
notice thereof, of the occurrence of any Possible Default or Event of Default
and the actions the Borrower intends to take in connection therewith, (d) within
five days after its receipt of notice thereof, of any cancellation of or any
material amendment to any of the insurance policies maintained in accordance
with the requirements of this Agreement, except for cancellations and amendments
that occur in the ordinary course of business, (e) promptly after the occurrence
thereof, of any material, adverse change in the business or financial condition
of the Borrower or any of its Subsidiaries, and (f) promptly after the
occurrence thereof, of any material strike, labor dispute, slow down or work
stoppage due to a labor disagreement (or any material development regarding any
thereof) affecting the Borrower or any of its Subsidiaries.
7.7 Maintenance of Property. The Borrower shall, and shall cause
each of its Subsidiaries to, at all times maintain and preserve its towers,
machinery, equipment, motor vehicles, fixtures and other property in good
working order, condition and repair, normal wear and tear excepted, and in
compliance with all material applicable standards, rules or regulations imposed
by any governmental authority or agency (including, without limitation, the FCC,
the Federal Aviation Administration or any other Licensing Authority) or policy
of insurance, except for such property which, in the judgment of the Borrower,
is no longer necessary to the business of the Borrower or any of its
Subsidiaries.
7.8 Information and Inspection. The Borrower shall furnish to the
Administrative Agent and the Banks from time to time, promptly upon request,
information reasonably requested by the Administrative Agent or any Bank
pertaining to any covenant, provision or condition hereof, or to any matter
connected with the books, records, operations, financial condition, properties,
activities or business of the Borrower or of any of its
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Subsidiaries. At all reasonable times, the Borrower shall permit any authorized
representative designated by any Bank to visit and inspect any of the properties
of the Borrower or any of its Subsidiaries, and their books and records, and to
take extracts therefrom and make copies thereof, and to discuss the Borrower's
and its Subsidiaries' affairs, finances and accounts with the management of the
Borrower and its Subsidiaries and with the Borrower's independent accountants.
7.9 Maintenance of Liens. The Borrower shall do all things
necessary or requested by the Administrative Agent to preserve and perfect the
Liens of the Administrative Agent, for the benefit of the Banks, arising
pursuant hereto and pursuant to the Collateral Documents as first Liens, except
for Permitted Liens, and to insure that the Administrative Agent, for the
benefit of the Banks, has a Lien on substantially all of the personal property
of the Borrower and its Subsidiaries. If the Borrower issues any capital stock
prior to the termination of the Borrower Pledge Agreement pursuant to Section
8.10(c), it shall cause the holder of such stock to pledge such stock to the
Administrative Agent, for the benefit of the Banks, as security for the
Obligations pursuant to a pledge agreement in form and substance satisfactory to
the Administrative Agent. If the Borrower or any of its Subsidiaries enters into
a new Operating Agreement or other material contract which prohibits the
assignment thereof or the granting of a security interest therein without the
consent of the other party, the Borrower shall use its best efforts to obtain
the written consent of such other party to the grant to the Administrative
Agent, for the benefit of the Banks, of a security interest therein pursuant to
the Security Agreements; provided, however, that the Borrower shall not be
obligated to accept any material adverse change in any such agreement or
contract or expend a material amount in attempting to obtain such consent.
7.10 Title To Property. The Borrower shall, and shall cause each of
its Subsidiaries to, own and hold title to all of its assets in its own name and
not in the name of any nominee.
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7.11 Environmental Compliance and Indemnity.
(a) The Borrower shall, and shall cause each of its
Subsidiaries to, comply in all material respects with any and all Environmental
Laws, including, without limitation, all Environmental Laws in jurisdictions in
which the Borrower or any of its Subsidiaries owns or operates a facility or
site, arranges for disposal or treatment of Hazardous Materials, solid waste or
other wastes, accepts for transport any Hazardous Materials, solid wastes or
other wastes or holds any interest in real property or otherwise. Neither the
Borrower nor any of its Subsidiaries shall cause or allow the Release of
Hazardous Materials, solid waste or other wastes on, under or to any real
property in which the Borrower or such Subsidiary holds any interest or performs
any of its operations, in material violation of any Environmental Law. The
Borrower shall notify the Banks promptly after its receipt of notice thereof, of
any Environmental Claim which the Borrower receives involving any potential or
actual material liability of the Borrower or any of its Subsidiaries arising in
connection with any noncompliance with or violation of the requirements of any
Environmental Law or a material Release or threatened Release of any Hazardous
Materials, solid waste or other waste into the environment. The Borrower shall
promptly notify the Banks (i) of any material Release of Hazardous Material on,
under or from the real property in which the Borrower or any of its Subsidiaries
holds or has held an interest, upon the Borrower's learning thereof by receipt
of notice that the Borrower or any of its Subsidiaries is or may be liable to
any Person as a result of such Release or that the Borrower or such Subsidiary
has been identified as potentially responsible for, or is subject to
investigation by any governmental authority relating to, such Release, and (ii)
of the commencement or threat of any judicial or administrative proceeding
alleging a violation of any Environmental Laws.
(b) If the Administrative Agent at any time has a
reasonable basis to believe that there may be a violation of any Environmental
Law by, or any liability arising thereunder of, the Borrower or any of its
Subsidiaries or related to any real property owned, leased or operated by the
Borrower or any of its Subsidiaries or real property adjacent to such real
property, which violation or liability could reasonably be expected to have a
Material Adverse Effect, then the Borrower shall, upon request from the
Administrative Agent, provide the Administrative Agent
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with such reports, certificates, engineering studies or other written material
or data as the Administrative Agent may require so as to satisfy the
Administrative Agent that the Borrower or such Subsidiary is in material
compliance with all applicable Environmental Laws.
(c) The Borrower shall defend, indemnify and hold the
Agents and the Banks, and their respective officers, directors, shareholders,
employees, agents, affiliates, successors and assigns harmless from and against
all costs, expenses, claims, demands, damages, penalties and liabilities of
every kind or nature whatsoever incurred by them (including reasonable attorneys
fees) arising out of, resulting from or relating to (i) the noncompliance of the
Borrower, any of its Subsidiaries or any property owned or leased by the
Borrower or any of its Subsidiaries with any Environmental Law, or (ii) any
investigatory or remedial action involving the Borrower, any of its Subsidiaries
or any property owned or leased by the Borrower or any of its Subsidiaries and
required by Environmental Laws or by order of any governmental authority having
jurisdiction under any Environmental Laws, or (iii) any injury to any person
whatsoever or damage to any property arising out of, in connection with or in
any way relating to the breach of any of the environmental warranties or
covenants contained in this Agreement or any facts or circumstances that cause
any of the environmental representations or warranties contained in this
Agreement to cease to be true, or (iv) the existence, treatment, storage,
Release, generation, transportation, removal, manufacture or other handling of
any Hazardous Material on or affecting any property owned or leased by the
Borrower or any of its Subsidiaries, or (v) the presence of any
asbestos-containing material or underground storage tanks, whether in use or
closed, under or on any property owned or leased by the Borrower or any of its
Subsidiaries; provided, however, that the foregoing indemnity shall not apply to
any such costs, expenses, claims, demands, damages, penalties or liabilities
that are determined in a final non-appealable order of a court of competent
jurisdiction to have arisen solely out of the gross negligence or willful
misconduct of the indemnified person.
7.12 Rate Hedging Obligations. The Borrower shall within forty-five
days after the Closing enter into, and shall at all times thereafter maintain in
full force and effect, agreements having an initial term of at least three years
and in form and
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substance reasonably satisfactory to the Administrative Agent regarding Rate
Hedging Obligations so that the sum of the notional amount subject to such
agreements plus the outstanding principal amount of Indebtedness of the Borrower
which bears interest at a fixed rate equals at all times at least 50% of the
principal amount of Total Debt then outstanding.
7.13 FCC Consents. The Borrower acknowledges that certain
transactions contemplated by this Agreement or the Collateral Documents, and
certain actions which may be taken by the Administrative Agent or the Banks in
the exercise of their rights under this Agreement or the Collateral Documents,
may require the consent of the FCC. If counsel to the Administrative Agent
determines that the consent of the FCC is required in connection with the
execution, delivery and performance of any of the aforesaid documents or any
documents delivered to the Administrative Agent or the Banks in connection
therewith or as a result of any action which may be taken pursuant thereto, then
the Borrower, at its sole cost and expense, shall use its best efforts, and
shall cause its Subsidiaries to use their best efforts, to secure such consent
and to cooperate with the Administrative Agent and the Banks in any action
commenced by the Administrative Agent or the Banks to secure such consent. The
Borrower shall not take any action, and shall not permit any of its Subsidiaries
to take any action, which interferes with the exercise or completion of any such
action taken by the Administrative Agent or the Banks. The Borrower further
consents to the transfer of control or assignment of Licenses to a receiver or
trustee or similar official or to any purchaser of the collateral securing the
Loans pursuant to any public or private sale, judicial sale, foreclosure or
exercise of other remedies available to the Administrative Agent or the Banks as
permitted by applicable law upon the occurrence of an Event of Default.
7.14 Subordinated Purchase Agreement. The Borrower shall deliver to
the Administrative Agent no later than October 31, 2003, a plan satisfactory to
the Banks holding at least 66 2/3% of the Commitment, including the Agents,
setting forth the method by which the Borrower intends either to raise funds
sufficient to pay in full the Indebtedness outstanding under the Subordinated
Purchase Agreement on its scheduled payment date or to restructure such
Indebtedness so that its scheduled payment date is no earlier than six months
after the Termination Date. Such
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plan shall be consistent with the terms and conditions of this Agreement. Such
plan shall set forth the time periods within which the Borrower will have
accomplished the various steps necessary to implement its plan, such as (a) the
obtaining of a commitment from the Subordinated Lender to restructure such
Indebtedness to have a final maturity no earlier than six months after the
Termination Date or (b) receiving an executed subscription agreement pursuant to
which a potential new stockholder agrees to purchase new shares of the Borrower
or (c) receiving an executed contribution agreement pursuant to which an
existing shareholder agrees to contribute to the capital of the Borrower.
Thereafter, the Borrower shall perform in accordance with the time limits set
forth in such plan, so that on the scheduled payment date, the Borrower will
either have funds sufficient to pay such Indebtedness in full or will have
restructured such Indebtedness in a manner acceptable to the Banks holding at
least 66 2/3% of the Commitment, including the Agents.
SECTION 8 NEGATIVE COVENANTS OF THE BORROWER.
The Borrower agrees with the Banks that so long as this Agreement shall
remain in effect or any of the Obligations shall remain unpaid or to be
performed, or any Letter of Credit remains outstanding, the Borrower shall not,
directly or indirectly, take any of the actions set out in this Section 8 nor
permit any of the conditions set out herein to occur.
8.1 Indebtedness. The Borrower shall not, and shall not permit any
of its Subsidiaries to, incur, create, assume or permit to exist any
Indebtedness, except:
(a) the Obligations;
(b) Indebtedness permitted under Sections 8.4, 8.5 or 8.6
hereof and any other Indebtedness secured by a Permitted Lien;
(c) unsecured trade accounts payable and other unsecured
current Indebtedness incurred in the ordinary course of business (but excluding
any Indebtedness for borrowed money);
(d) Indebtedness for taxes, assessments, governmental
charges, liens or similar claims to the extent that payment
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thereof shall not be required to be made by the provisions of
Section 7.4;
(e) Indebtedness incurred in respect of Rate Hedging
Obligations required pursuant to Section 7.12;
(f) Indebtedness of the Borrower owing to the
Subordinated Lender incurred pursuant to the terms of the Subordinated Purchase
Agreement as in effect on the date hereof;
(g) Subordinated Debt of the Borrower so long as (i) no
principal is payable on such Indebtedness prior to the date that is at least six
months after the Termination Date, (ii) the aggregate principal amount of all
Indebtedness incurred pursuant to this clause 8.1(g) does not exceed at any time
$150,000,000, (iii) the terms and conditions of all agreements, documents and
instruments evidencing or governing such Indebtedness, including the terms and
conditions of subordination, shall be satisfactory to the Required Banks, (iv)
the Borrower shall have delivered to the Administrative Agent and the Banks
revised projections for the period from the incurrence of such Indebtedness
through the Termination Date which shall be in form and substance reasonably
satisfactory to the Administrative Agent and shall demonstrate the Borrower's
ability to comply with the financial covenants contained in Section 8, and the
Borrower shall have demonstrated to the satisfaction of the Administrative Agent
that the Borrower will be in compliance with all of the covenants contained
herein after giving effect to the incurrence of such Indebtedness, (v) no
Possible Default or Event of Default exists at the time of incurrence of such
Indebtedness or would exist after giving effect thereto, and (vi) the Borrower
shall have delivered to the Administrative Agent a certificate of a financial
officer of the Borrower in form and substance satisfactory to the Administrative
Agent which shall contain calculations demonstrating on a pro forma basis the
Borrower's compliance with the financial covenants set forth in this Section 8
after giving effect to the incurrence of such Indebtedness;
(h) Indebtedness arising under the Xxxxxxxx Letter of
Credit; and
(i) existing Indebtedness listed on Exhibit F.
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8.2 Liens. The Borrower shall not, and shall not permit any of its
Subsidiaries to, incur, create, assume or permit to exist any Lien of any nature
whatsoever on any property or assets now owned or hereafter acquired by the
Borrower or any of its Subsidiaries, other than Permitted Liens. The Borrower
shall not, and shall not permit any of its Subsidiaries to, enter into or permit
to exist any arrangement or agreement, other than pursuant to this Agreement or
any Collateral Document, which directly or indirectly prohibits the Borrower or
any of its Subsidiaries from creating or incurring any Lien on any of its
assets, other than (a) leases and agreements regarding purchase money
Indebtedness permitted pursuant to Section 8.4 (so long as such prohibition only
relates to the asset which is subject to such lease or which secure such
Indebtedness), (b) provisions in agreements which prohibit the assignment of
such agreements and (c) restrictions on the creation of Liens contained in the
Subordinated Purchase Agreement as in effect as of the date hereof.
8.3 Guaranties. The Borrower shall not, and shall not permit any
of its Subsidiaries to, become a Guarantor for any Person, except with respect
to (a) endorsements of negotiable instruments for collection in the ordinary
course of business, (b) the Guaranty, and (c) contingent obligations incurred in
the ordinary course of business with respect to surety and appeal bonds,
performance and return-of-money bonds and other similar obligations not
exceeding at any time outstanding $1,000,000 in aggregate liability.
8.4 Rental and Conditional Sale Obligations. The Borrower shall
not, and shall not permit any of its Subsidiaries to, incur, create, assume or
permit to exist, with respect to any personal property, any conditional sale
obligation, any purchase money obligation, any rental obligation, any purchase
money security interest or any other arrangement for the use of personal
property of any other Person, which in any such case has an unexpired term of
not less than one year, other than an arrangement constituting a Capitalized
Lease Obligation, if the aggregate amount payable by the Borrower and its
Subsidiaries pursuant to all such arrangements in any fiscal year would exceed
the sum of $1,000,000 plus the amount of any such obligations incurred pursuant
to a Permitted Acquisition.
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8.5 Real Property Interests. The Borrower shall not, and shall not
permit any of its Subsidiaries to, be obligated under, enter into, assume or
permit to exist any lease or rental obligation for real property (other than any
lease or rental obligation where the Borrower receives rent from sublessees in
an amount in excess of the rents payable by the Borrower to the lessor) which
has an unexpired term of not less than one year, if the aggregate amount payable
in respect of all such arrangements by the Borrower and its Subsidiaries in any
fiscal year would exceed the sum of $4,500,000 plus the amount of any such
obligations incurred pursuant to a Permitted Acquisition.
8.6 Capitalized Lease Obligations. The Borrower shall not, and shall
not permit any of its Subsidiaries to, incur, create, assume or permit to exist
Capitalized Lease Obligations if the aggregate amount payable by the Borrower
and its Subsidiaries in respect of all such Capitalized Lease Obligations in any
fiscal year would exceed the sum of $2,000,000 plus the amount of any such
obligations incurred pursuant to a Permitted Acquisition.
8.7 Capital Expenditures. The Borrower and its Subsidiaries shall not
make Project Capital Expenditures (i) in fiscal year 1998 which exceed in the
aggregate $8,000,000, or (ii) in any fiscal year thereafter which exceed in the
aggregate $5,000,000 (the amount permitted in any year pursuant to this sentence
being referred to as the "Base Amount" for such year). If the Base Amount for
any year exceeds the aggregate amount of Project Capital Expenditures actually
made by the Borrower and its Subsidiaries in such year (such excess being
referred to as the "Excess Amount"), then the Borrower and its Subsidiaries may
make Project Capital Expenditures in the immediately succeeding year (but not in
any year thereafter) in excess of the Base Amount for such succeeding year in an
amount not to exceed the Excess Amount for the prior year.
8.8 Notes, Accounts Receivable and Claims. The Borrower shall not, and
shall not permit any of its Subsidiaries to, sell, discount or otherwise dispose
of any note, account receivable or other right to receive payment, with or
without recourse, except for collection in the ordinary course of business; or
fail to timely assert any claim, cause of action or contract right which it
possesses against any third party or agree to settle or compromise any such
claim, cause of action or contract right except in any case in the exercise of
good business judgment and
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except for settlements or compromises made in the reasonable exercise of
business judgment in the ordinary course of business.
8.9 Capital Distributions; Restrictions on Payments to Stockholders.
(a) The Borrower shall not, and shall not permit any of its
Subsidiaries to, make, or declare or incur any liability to make, any Capital
Distribution, except that:
(i) any Subsidiary of the Borrower may make Capital
Distributions to the Borrower or to a wholly owned Subsidiary of the Borrower;
(ii) so long as the Borrower has not ceased to be treated as
an "S corporation" under the Code, the Borrower may make Distributions to pay
Tax Liabilities for the then current or immediately previous tax year of the
Borrower (or any prior year that the Borrower was an "S corporation" if such
Distribution is a result of an Internal Revenue Service audit adjustment) so
long as: (A) prior to each such distribution, a financial officer of the
Borrower has provided the Administrative Agent with a certificate in form and
substance reasonably satisfactory to the Administrative Agent stating the amount
of each Tax Liability for which a distribution is to be made (which certificate
will also explain in reasonable detail the basis for and method of calculating
the Tax Liability); (B) such distribution has been specifically approved by a
written resolution of the Board of Directors of the Borrower; (C) no Possible
Default or Event of Default arising under Section 9.1 exists at the time of
making such distribution or would exist after giving effect thereto; and (D)
such distributions shall not be made more frequently than four times in any four
quarter period for state income taxes or more than five times in any four
quarter period for federal income taxes;
(iii) the Borrower may make Capital Distributions to its
stockholders in any fiscal year in an aggregate amount which does not exceed
$305,000 for such fiscal year, multiplied each year on the anniversary hereof by
the percentage increase, if any, in the U.S. Department of Labor, Bureau of
Labor Statistics Consumer Price Index (the "CPI") (if the CPI ceases to exist or
is substantially changed, the Administrative Agent shall substitute a similar
index), so long as: (A) the Borrower shall
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have demonstrated to the satisfaction of the Administrative Agent that the
Borrower will be in compliance with all of the covenants contained herein after
giving effect to such distribution; (B) no Possible Default or Event of Default
exists at the time of making such distribution or would exist after giving
effect thereto; (C) the Borrower shall have delivered to the Administrative
Agent a certificate of a financial officer of the Borrower using the most
recently available quarterly financial statements in form and substance
satisfactory to the Administrative Agent which shall contain calculations
demonstrating on a pro forma basis the Borrower's compliance with the financial
covenants set forth in this Section 8 after giving effect to such distribution;
and (D) such distributions shall not be made more frequently than once per year;
and
(iv) the Borrower may make Capital Distributions to its
stockholders in any fiscal year, so long as:
(A) the Leverage Ratio is less than 5.0 to 1.0 as of the
end of the most recently ended fiscal year of the Borrower (as determined by the
annual financial statements provided pursuant to Section 7.5(a)) and as of the
date of any such distribution and after giving effect thereto;
(B) such distributions shall not exceed an amount equal
to the Excess Cash Flow as of the end of the immediately preceding year;
(C) the Borrower shall have demonstrated to the
satisfaction of the Administrative Agent that the Borrower will be in compliance
with all of the covenants contained herein after giving effect to such
distribution;
(D) no Possible Default or Event of Default exists at
the time of making such distribution or would exist after giving effect thereto;
(E) the Borrower shall have delivered to the
Administrative Agent a certificate of a financial officer of the Borrower in
form and substance satisfactory to the Administrative Agent which shall contain
calculations demonstrating on a pro forma basis the Borrower's compliance with
the financial covenants set forth in this Section 8 after giving effect to such
distribution; and
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(F) such distributions shall only be made once per year
within the sixty day period commencing with the date on which the Administrative
Agent receives the Borrower's annual financial statements for the fiscal year
most recently ended prior to such distribution.
(b) The Borrower shall not permit any of its Subsidiaries to agree
to or to be subject to any restriction on its ability to make Capital
Distributions or loans or other asset transfers to its stockholders other than
restrictions imposed by applicable law and the restrictions set forth in this
Section.
8.10 Disposal of Property; Mergers; Acquisitions; Reorganizations.
(a) Except as provided in paragraphs (b) and (c) below, the
Borrower shall not, and shall not permit any of its Subsidiaries to, (i)
dissolve or liquidate; (ii) sell, lease, transfer or otherwise dispose of any
material portion of its properties and assets to any Person, except for (A) the
disposition of assets in the ordinary course of business in an aggregate amount
not to exceed $2,000,000 in any transaction or related series of transactions,
(B) the disposition of any asset which, in the good faith exercise of its
business judgment, the Borrower determines is no longer useful in the conduct of
its or its Subsidiaries' business, and (C) the exchange of a Station in
connection with a Permitted Acquisition, subject to the satisfaction of the
provisions of Section 2.6(b)(iii); (iii) be a party to any consolidation,
merger, recapitalization or other form of reorganization; (iv) make any
acquisition of all or substantially all the assets of any Person, or of a
business division or line of business of any Person, or of any other assets
constituting a going business; (v) create, acquire or hold any Subsidiary (other
than the License Partnership), or (vi) be or become a party to any joint venture
or other partnership except as set forth on Exhibit L attached hereto.
(b) The Borrower may make the acquisitions contemplated in the
Acquisition Agreements subject to its compliance with clauses (iv), (v), (vi),
(vii) and (viii) below. In addition, the Borrower may make acquisitions of
substantially all of the assets of any radio station or tower site or of all of
the capital stock or other equity interests of a Person which
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owns a radio station or tower site, subject to the satisfaction of the following
conditions (the acquisitions pursuant to the Acquisition Agreements and any
other acquisition which satisfies all of the following conditions being referred
to hereinafter as a "Permitted Acquisition"):
(i) such radio station or tower site shall be located in a
market in which the Borrower or a wholly owned Subsidiary of the Borrower owns a
Station or in one of the 75 largest Metro Survey Areas, as determined by The
Arbitron Company;
(ii) the Borrower shall have given to the Administrative
Agent notice of such acquisition at least five days prior to executing any
binding commitment with respect thereto, which notice shall state the additional
amounts, if any, by which the Borrower proposes to increase the dollar
limitations set forth in Sections 8.4, 8.5 and 8.6; and the Agents and the
Required Banks shall have received evidence satisfactory to them that the
structure of the transaction shall satisfy all material, applicable legal and
regulatory requirements relating to such acquisition;
(iii) the Borrower shall have demonstrated to the satisfaction
of the Administrative Agent that the Borrower will be in compliance with all of
the covenants contained herein after giving effect to such acquisition and that
no Event of Default or Possible Default then exists or would exist after giving
effect to such acquisition, and the Borrower shall have delivered to the
Administrative Agent within ten days prior to the consummation of such
acquisition an acquisition report signed by an executive officer of the Borrower
in form and substance satisfactory to the Administrative Agent which shall
contain (A) calculations demonstrating on a pro forma basis the Borrower's
compliance with the financial covenants set forth in this Section 8 after giving
effect to such acquisition, and (B) projections for the Borrower for a five year
period after the closing of such acquisition giving effect to the acquisition
and including a statement of sources and uses of funds for such acquisition
showing, among other things, the source of financing for the acquisition;
(iv) all FCC Licenses acquired in connection with such
acquisition shall be transferred immediately upon consummation of such
acquisition to the License Partnership or to
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a direct wholly owned Subsidiary of the Borrower which shall have no other
assets or liabilities;
(v) the Borrower shall have delivered to the Administrative
Agent UCC, judgment and tax lien searches for each relevant jurisdiction and
shall have taken any actions as may be necessary or reasonably requested by the
Administrative Agent to grant to the Administrative Agent, for the benefit of
the Banks, perfected Liens in all personal property acquired by the Borrower or
any of its Subsidiaries in such acquisition pursuant to the Collateral
Documents, subject to no prior Liens except Permitted Liens;
(vi) if the Borrower acquires a Subsidiary or creates a
Subsidiary (including a License Subsidiary) pursuant to or in connection with
such acquisition,
(A) such Subsidiary shall be directly wholly owned by
the Borrower;
(B) the Borrower shall pledge to the Administrative
Agent, for the benefit of the Banks, all of the stock or other securities or
equity interests of such acquired or created Subsidiary pursuant to
documentation in form and substance satisfactory to the Administrative Agent;
and
(C) such acquired or created Subsidiary shall execute
and deliver to the Administrative Agent, for the benefit of the Banks, a
guaranty of all of the Obligations of the Borrower, in form and substance
satisfactory to the Administrative Agent, and shall grant to the Administrative
Agent, for the benefit of the Banks, a first priority, perfected lien or
security interest in substantially all of its personal property subject to no
prior Liens except for Permitted Liens, pursuant to documentation in form and
substance satisfactory to the Administrative Agent;
(vii) the Borrower shall have delivered to the Administrative
Agent evidence reasonably satisfactory to the Administrative Agent to the effect
that all approvals, consents or authorizations required in connection with such
acquisition (including the formation of any License Subsidiary and the transfer
of FCC Licenses to such Subsidiary) from any Licensing Authority or other
governmental authority shall have been
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obtained and, except as expressly permitted by the Administrative Agent, that
any consent of the FCC shall have become a Final Order, and such opinions as the
Administrative Agent may reasonably request as to the Liens granted to the
Administrative Agent, for the benefit of the Banks, as required pursuant to this
Section, as to any required regulatory approvals for such acquisition and as to
such other matters as the Administrative Agent may reasonably request; and
(viii) if the Borrower has consummated the reorganization
contemplated by Section 8.10(c), the Borrower shall cause such acquisition to be
consummated by a Subsidiary and not by it.
(c) As of the date of this Agreement, all of the assets of each
Station, other than the FCC Licenses, are owned by the Borrower, and all of the
FCC Licenses of the Stations are owned by the License Partnership. The Borrower
desires to create new Subsidiaries and contribute all of its operating assets
relating to the Stations and all of the FCC Licenses held by the License
Partnership to such Subsidiaries. The Borrower shall have the right to so
reorganize subject to the satisfaction of all of the following conditions:
(i) each new Subsidiary shall be directly and wholly owned
by the Borrower;
(ii) all of the FCC Licenses of the Stations shall be
transferred to one or more of such newly created Subsidiaries which shall have
no other assets or liabilities, and upon such transfer, the License Partnership
shall be dissolved and liquidated;
(iii) the Borrower shall pledge to the Administrative Agent,
for the benefit of the Banks, all of the stock or other securities or equity
interests of such acquired or created Subsidiaries pursuant to documentation in
form and substance satisfactory to the Administrative Agent; and
(iv) such acquired or created Subsidiaries shall execute and
deliver to the Administrative Agent, for the benefit of the Banks, a guaranty of
all of the Obligations of the Borrower, in form and substance satisfactory to
the Administrative Agent, and shall grant to the Administrative
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Agent, for the benefit of the Banks, a first priority, perfected lien or
security interest in substantially all of their personal property subject to no
prior Liens except for Permitted Liens, pursuant to documentation in form and
substance satisfactory to the Administrative Agent; and
(v) the Borrower and its Subsidiaries shall take such other
actions as the Administrative Agent may reasonably request in connection with
such reorganization.
Upon completion of such reorganization, so long as all operating assets and
Licenses relating to all of the Stations have been contributed to such newly
created Subsidiaries, the Administrative Agent shall terminate the Borrower
Pledge Agreement and release the stock certificates held by it pursuant to that
agreement.
8.11 Investments. The Borrower shall not, and shall not permit any of
its Subsidiaries to, purchase or otherwise acquire, hold or invest in any stock
or other securities or evidences of indebtedness of, or any interest or
investment in, or make or permit to exist any loans or advances to, any other
Person, except:
(a) direct obligations of the United States Government maturing
within one year;
(b) certificates of deposit of a member bank of the Federal
Reserve System having capital, surplus and undivided profits in excess of
$2,000,000,000;
(c) any investment in commercial paper which at the time of such
investment is assigned the highest quality rating in accordance with the rating
systems employed by either Xxxxx'x Investors Service, Inc. or Standard & Poor's
Corporation;
(d) money market funds;
(e) securities received pursuant to a plan of reorganization
adopted in an insolvency proceeding or otherwise in immaterial amounts in
exchange for accounts receivable of the entity which is the subject of such
insolvency proceeding generated in the ordinary course of the Borrower's or any
of its Subsidiaries' business;
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(f) investments in the License Partnership and in Subsidiaries
created pursuant to Section 8.10(b) and (c); and
(g) investments having an aggregate cost for all investments made
pursuant to this clause (g) of not to exceed $4,000,000, so long as: (i) no
Event of Default or Possible Default exists as of the date of making any such
investment or would exist after giving effect thereto, (ii) the Borrower shall
have given notice to the Administrative Agent of each such investment at least
fifteen days prior to making such investment, (iii) each such investment shall
be structured so that it is non-recourse to the Borrower and its Subsidiaries
and that neither the Borrower nor any of its Subsidiaries shall have any
liability or obligation, contingent or otherwise, in respect of such investment,
and (iv) each such investment shall be pledged to the Administrative Agent for
the benefit of the Banks pursuant to documentation in form and substance
satisfactory to the Administrative Agent as security for the Obligations.
8.12 Amendment of Governing Documents. The Borrower shall not, and
shall not permit any of its Subsidiaries to, amend, modify or supplement its
Certificate or Articles of Incorporation, By-Laws, Certificate of Limited
Partnership, partnership agreement or other organizational or governing
documents or any shareholders or security holders agreement, unless required by
law, in any manner that is adverse to the interests of the Banks (as may be
reasonably determined by the Banks).
8.13 Financial Covenants.
(a) Total Leverage Ratio. The Borrower shall not permit the
Leverage Ratio at any time during any period listed in Column A below to be
greater than the ratio set forth in Column B below opposite such period:
Column A Column B
-------- --------
Period: Permitted Ratio:
------- ----------------
Closing through March 31, 7.0:1.0
1999:
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April 1, 1999, through March 6.5:1.0
31, 2000:
April 1, 2000, through March 6.0:1.0
31, 2001:
April 1, 2001, through March 5.5:1.0
31, 2002:
April 1, 2002, through March 5.0:1.0
31, 2003:
April 1, 2003, through March 4.5:1.0
31, 2004:
April 1, 2004, and thereafter: 4.0:1.0
(b) Senior Leverage Ratio. The Borrower shall not permit the ratio
of the outstanding principal amount of the Loans as of any date in any period
listed in Column A below to Operating Cash Flow for the four quarter period then
ended or then most recently ended (i) to be greater than the ratio set forth in
Column B below opposite such period if at such time the Borrower has
Subordinated Debt outstanding, or (ii) to be greater than the ratio set forth in
Column C below opposite such period if at such time the Borrower has no
Subordinated Debt outstanding:
Column A Column B Column C
-------- -------- --------
Period: Permitted Ratio if Permitted Ratio if
Subordinated Debt: No Subordinated
Debt:
------- ------------------ ------------------
Closing through 6.0:1.0 6.5:1.0
March 31, 1999:
April 1, 1999, 5.5:1.0 6.0:1.0
through March 31,
2000:
April 1, 2000, 5.0:1.0 5.5:1.0
through March 31,
2001:
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April 1, 2001, 4.5:1.0 5.0:1.0
through March 31,
2002:
April 1, 2002, 4.0:1.0 4.5:1.0
through March 31,
2003:
April 1, 2003, 3.5:1.0 4.0:1.0
through March 31,
2004:
April 1, 2004, and 3.0:1.0 3.5:1.0
thereafter:
(c) Fixed Charge Coverage Ratio. The Borrower shall not permit the
Fixed Charge Coverage Ratio as of the end of any fiscal quarter to be less than
1.05 to 1.00.
(d) Operating Cash Flow to Interest Expense. The Borrower shall
not permit the ratio of Operating Cash Flow for any four quarter period to
Interest Expense for such four quarter period (the "Interest Coverage Ratio) to
be less than 2.0 to 1.0. The Borrower shall not permit the Interest Coverage
Ratio calculated on a pro forma basis as of the date of consummation of any
Permitted Acquisition for the four quarter period then ended or most recently
ended as if such acquisition had occurred on the first day of such four quarter
period to be less than 1.75 to 1.00.
(e) Broadcast Cash Flow Concentration. The Borrower shall not
permit the Broadcast Cash Flow attributable to the Stations in any one market
for any four quarter period to exceed 60% of the total Broadcast Cash Flow for
such period.
8.14 Management Agreements and Fees.
(a) Except for agreements permitted pursuant to Section 8.14(b),
the Borrower shall not, and shall not permit any of its Subsidiaries to, make or
enter into, or pay any management fees pursuant to, any so-called management or
service agreement or joint operating agreement whereby management, supervision
or control of its business, or any significant aspect thereof, shall be
delegated to or placed in any Person other than the Borrower,
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an employee of the Borrower or any Subsidiary. The Borrower shall not, and shall
not permit any of its Subsidiaries to, make or enter into, or receive any
management fees pursuant to, any so-called management or service agreement or
joint operating agreement whereby management, supervision or control of the
business of any other Person (other than a Subsidiary of the Borrower), or any
significant aspect thereof, shall be delegated to or placed in the Borrower or
any of its Subsidiaries.
(b) Without the prior written consent of the Administrative Agent,
the Borrower shall not, and shall not permit any of its Subsidiaries to, enter
into, or otherwise be obligated under any local marketing agreement (other than
with respect to Stations being acquired pursuant to Permitted Acquisitions),
time brokerage agreement, program service agreement, joint sales agreement,
facilities leasing agreement or similar arrangement; provided, however, that the
Borrower may enter into any such arrangements with respect to any AM Station
owned by it upon written notice to the Administrative Agent.
8.15 Fiscal Year. The Borrower shall not, and shall not permit any
Subsidiary to, change its fiscal year.
8.16 ERISA. Neither the Borrower nor any member of the Controlled Group
shall fail to make any contributions which are required pursuant to the terms of
any Plan or any Benefit Arrangement. Neither the Borrower nor any member of the
Controlled Group shall contribute to or agree to contribute to any Plan which is
(a) subject to the minimum funding requirements under ERISA Section 302 or Code
Section 412; (b) a multiemployer plan (as defined in ERISA Section 4001(a)(3));
(c) a defined benefit plan (as defined under ERISA Section 3(35) or Code Section
414(j)); (d) a multiple employer plan (as defined in ERISA Section 4063); or (e)
a multiple employer welfare arrangement (as defined in ERISA Section 3(40)).
8.17 Affiliates. The Borrower shall not, and shall not permit any of
its Subsidiaries to, enter into any transaction or agreement with any Affiliate
of the Borrower or pay any compensation or salary to any such Person unless such
transaction or agreement is in the ordinary course of and pursuant to the
reasonable requirements of the business of the Borrower or any of its
Subsidiaries and the terms of such transaction or agreement are not
substantially less favorable to the Borrower or such
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Subsidiary than could be obtained in an arms-length transaction with an
unaffiliated third party or unless the amount paid to such person is not
substantially in excess of the fair value of the services rendered by such
person.
8.18 Change of Name, Identity or Structure. The Borrower shall not, and
shall not permit any of its Subsidiaries to, change its name, identity or
corporate or partnership structure without thirty days prior written notice to
the Administrative Agent.
8.19 Amendments or Waivers. The Borrower shall not, and shall not
permit any of its Subsidiaries to, amend, alter or modify, or consent to or
suffer any amendment, alteration or modification of, the Subordinated Purchase
Agreement or any notes or other documents or agreements issued or entered into
pursuant to the Subordinated Purchase Agreement, or any Acquisition Agreement,
License, Operating Agreement or other material contract to which the Borrower or
such Subsidiary is a party without the prior written consent of all of the Banks
if such amendment, alteration or modification imposes any significantly more
onerous term or condition on the Borrower than is contained in such agreement,
note, document, License or contract as of the date hereof or is otherwise
materially adverse to the Banks, or without the prior written consent of the
Required Banks if such amendment, alteration or modification does not impose any
more onerous term or condition on the Borrower than is contained in such
agreement, note, document, License or contract as of the date hereof and is not
otherwise materially adverse to the Borrower or the Banks, in either case as
reasonably determined by the Administrative Agent.
8.20 Issuance or Transfer of Capital Stock. The Borrower shall not
permit any of its Subsidiaries to sell or issue any capital stock, partnership
interests or other equity interests or any warrants, options or other securities
convertible into or exercisable for any capital stock, partnership interests or
other equity interests, and the Borrower shall not permit any of its
Subsidiaries to permit the transfer of any capital stock, partnership interests
or other such equity interests.
8.21 Change in Business. The Borrower shall not, and shall not permit
any of its Subsidiaries to, change the nature of its business in any material
respect. Neither the Borrower nor any
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of its Subsidiaries shall engage in any business other than the ownership and
operation of radio stations and other activities incidental or related thereto.
8.22 Regulation U. The Borrower shall not, and shall not permit any of
its Subsidiaries to, directly or indirectly, (a) apply any part of the proceeds
of the Loans to the purchasing or carrying of any "margin stock" within the
meaning of Regulations G, T, U or X of the Federal Reserve Board, or any
regulations, interpretations or rulings thereunder, (b) extend credit to others
for the purpose of purchasing or carrying any such margin stock, or (c) retire
Indebtedness which was incurred to purchase or carry any such margin stock.
8.23 License Subsidiaries. The Borrower shall not, and shall not permit
any Subsidiary (other than a License Subsidiary) to, hold any FCC Licenses, but
rather shall cause all FCC Licenses relating to the Stations to be issued to and
held by a License Subsidiary. The Borrower shall not permit the License
Partnership or any other License Subsidiary to (a) incur, create, assume or
permit to exist any Indebtedness other than pursuant to the Guaranty and the
other Collateral Documents, (b) incur, create, assume or permit to exist any
Lien of any nature whatsoever on any property or assets now owned or hereafter
acquired by it except in favor of the Administrative Agent, for the benefit of
the Banks, (c) make any Capital Expenditures, (d) acquire any assets other than
the Licenses, (e) conduct any business, or (f) hire or engage any employees,
except, in the case of the License Partnership, pursuant to the Management
Agreement.
8.24 Subordinated Debt. The Borrower shall not redeem, discharge, pay,
prepay or defease all or any portion of the principal of any Subordinated Debt
prior to the payment in full in cash of all Obligations. The Borrower shall not
redeem, discharge, pay, prepay or defease all or any portion of the principal or
interest of any Indebtedness owing to the Subordinated Lender, prior to the
payment in full in cash of all Obligations, except that (a) the Borrower may
issue Redemption Notes and Put Notes in the forms attached to the Subordinated
Purchase Agreement in effect as of the date hereof and (b) the Borrower may
issue shares of common stock to the Subordinated Lender pursuant to the terms of
the Convertible Subordinated Notes in the forms attached to the Subordinated
Purchase
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Agreement in effect as of the date hereof so long as such shares of common stock
are pledged to the Administrative Agent for the benefit of the Banks as security
for the Obligations. The Borrower shall not, and shall not elect to, make any
payment of principal on any Subordinated Debt, or any payment of principal or
interest on any Indebtedness owing to the Subordinated Lender (including,
without limitation, any payment of the Mandatory Redemption Obligations or the
Put Obligation, as those terms are defined in the Subordinated Purchase
Agreement), in cash. The Borrower shall not exercise any right of first offer or
right of first refusal under Article X of the Subordinated Purchase Agreement.
Except as expressly provided in a plan approved by the Banks pursuant to Section
7.14, the Borrower shall not take any action in violation of any of the
provisions of Article XII of the Subordinated Purchase Agreement. The Borrower
shall not, pursuant to clause (b) of the definition of the term "Senior Debt" in
the Subordinated Purchase Agreement, designate any Indebtedness (other than the
Obligations) as Senior Debt.
SECTION 9 EVENTS OF DEFAULT.
The occurrence of any one or more of the following events, whether
voluntarily or involuntarily or by operation of law, shall constitute an Event
of Default hereunder:
9.1 Non-Payment. The Borrower shall fail to pay when due, whether by
acceleration of maturity or otherwise, any installment of principal due
hereunder or under any Note or shall fail to pay within three days of the date
when due, whether by acceleration of maturity or otherwise, any installment of
interest due hereunder or under any Note or any fee or other payment obligation
in respect of the Obligations.
9.2 Failure of Performance in Respect of Other Obligations. (a) The
Borrower shall fail to observe, perform or be in compliance with any of the
provisions of Section 8, Section 7.1, Section 7.3, Section 7.8 or the first
sentence of Section 7.2; or (b) the Borrower, any of its Subsidiaries or any
other party to a Collateral Document (other than the Administrative Agent or a
Bank) shall fail to observe, perform or be in compliance with the terms of any
Obligation, covenant or agreement (other than those referred to in Section 9.1,
Section 8, Section 7.1, Section 7.3, Section 7.8 or the first sentence of
Section 7.2) to be observed, performed or complied with by the Borrower, any of
its
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Subsidiaries or such other party hereunder or under any Collateral Document and,
provided that such failure is of a type which can be cured, such failure shall
continue and not be cured for thirty days after: (i) written notice thereof from
the Administrative Agent or a Bank; or (ii) the Administrative Agent or the
Banks are notified thereof or should have been notified thereof pursuant to the
provisions of Section 7.6 hereof, whichever is earlier.
9.3 Breach of Warranty. Any financial statement, representation,
warranty, statement or certificate made or furnished by the Borrower, any of its
Subsidiaries or any other party to a Collateral Document (other than the
Administrative Agent or a Bank) in or in connection with this Agreement or any
Collateral Document, or as an inducement to the Administrative Agent or the
Banks to enter into this Agreement and the Collateral Documents, including,
without limitation, those in Section 5 above, shall have been false, incorrect
or incomplete when made or deemed made in any material respect.
9.4 Cross-Defaults. Any Change in Control or Event of Default, as those
terms are defined in the Subordinated Purchase Agreement as in effect as of the
date hereof, shall occur; or the Borrower or any of its Subsidiaries shall
default in any payment due on any Total Debt in excess of $250,000 and such
default shall continue for more than the period of grace, if any, applicable
thereto; or the Borrower or any of its Subsidiaries shall default in the
performance of or compliance with any term of any evidence of such Total Debt or
of any mortgage, indenture or other agreement relating thereto, and any such
default shall continue for more than the period of grace, if any, specified
therein if such default causes, or permits the holder thereof to cause, the
acceleration of such Total Debt.
9.5 Assignment for Benefit of Creditors. The Borrower or any of its
Subsidiaries shall make an assignment for the benefit of its creditors, or shall
admit its insolvency or shall fail to pay its debts generally as such debts
become due.
9.6 Bankruptcy. Any petition seeking relief under Title 11 of the
United States Code, as now constituted or hereafter amended, shall be filed by
or against the Borrower or any of its Subsidiaries or any proceeding shall be
commenced by or against the Borrower or any of its Subsidiaries with respect to
relief
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under the provisions of any other applicable bankruptcy, insolvency or other
similar law of the United States or any State providing for the reorganization,
winding-up or liquidation of Persons or an arrangement, composition, extension
or adjustment with creditors; provided, however, that no Event of Default shall
be deemed to have occurred if any such involuntary petition or proceeding shall
be discharged within sixty days of its filing or commencement.
9.7 Appointment of Receiver; Liquidation. A receiver or trustee shall
be appointed for the Borrower or any of its Subsidiaries or for any substantial
part of its assets, and such receiver or trustee shall not be discharged within
sixty days of his appointment; any proceedings shall be instituted for the
dissolution or the full or partial liquidation of the Borrower or any of its
Subsidiaries and such proceedings shall not be dismissed or discharged within
sixty days of their commencement; or the Borrower or any of its Subsidiaries
shall discontinue its business.
9.8 Judgments. The Borrower or any of its Subsidiaries shall incur
non-appealable final judgments for the payment of money aggregating at any one
time in excess of $1,000,000 (to the extent not covered by insurance) and shall
not discharge (or make adequate provision for the discharge of) the same within
a period of thirty days unless, pending further proceedings, execution thereon
has been effectively stayed; or a non-monetary judgment or order shall be
rendered against the Borrower or any of its Subsidiaries that could reasonably
be expected to have a Material Adverse Effect, and there shall be any period in
excess of thirty 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.
9.9 Impairment of Collateral; Invalidation of any Loan Document. (i) A
creditor of the Borrower or of any of its Subsidiaries shall obtain possession
of any significant portion of the collateral for the Obligations by any means,
including, without limitation, levy, distraint, replevin or self-help, or any
creditor shall establish or obtain any right in such collateral which is equal
or senior to a Lien of the Administrative Agent, for the benefit of the Banks,
in such collateral; or (ii) any material damage to, or loss, theft or
destruction of, any material collateral for the Loans shall
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occur, except to the extent such loss, damage or injury is covered by insurance;
or (iii) subject to Section 8.10(c), the Administrative Agent, for the benefit
of the Banks, shall cease to have a first priority perfected lien (except for
Permitted Liens) in all of the issued and outstanding capital stock of the
Borrower and each corporate Subsidiary of the Borrower, in all of the issued and
outstanding partnership interests in the License Partnership held by the
Borrower, in all of the issued and outstanding partnership interests or other
equity interests in each other Subsidiary of the Borrower and in substantially
all of the properties and assets of the Borrower and each Subsidiary; or (iv)
any Lien granted or created or purported to be granted or created by this
Agreement or any Collateral Document shall cease or fail to be perfected with
respect to any significant portion of the collateral purported to be covered
thereby; or (v) this Agreement, any Note or any Collateral Document ceases to be
a legal, valid and binding agreement or obligation enforceable against any party
thereto (including the Banks or the Administrative Agent) in accordance with its
terms, or shall be terminated, invalidated, set aside or declared ineffective or
inoperative and such cessation, termination, invalidity, set aside or
declaration could reasonably be expected to have a Material Adverse Effect; or
(vi) the Borrower, any Subsidiary or any member of the Field Family shall
contest or deny the validity or enforceability of any Collateral Document to
which it is a party or any lien, security interest or obligation purported to be
created thereby.
9.10 Termination of License or Operating Agreement. The FCC or any
other Licensing Authority shall (a) revoke, terminate, substantially and
adversely modify or fail to renew any material License relating to a Station, or
(b) designate any material License for hearing or commence proceedings to
suspend, revoke, terminate or substantially and adversely modify any such
License and such proceedings shall not be dismissed or discharged within sixty
days; or the Borrower or the License Partnership shall be required pursuant to a
final non-appealable order to sell or otherwise dispose of any Station; or any
Operating Agreement or any other agreement which is necessary to the operation
of a Station shall be revoked or terminated or materially, adversely modified
and not replaced by a substitute acceptable to the Required Banks within thirty
days of such revocation, termination or modification.
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9.11 Change of Control. Xxxxxx X. Field and his immediate family,
including his wife, his children, the spouses of his children and his
grandchildren, or trusts created for the benefit of any of the foregoing, shall
cease to own collectively 51% of the voting capital stock of the Borrower; or a
period of ninety days shall elapse during which neither Xxxxxx X. Field nor
Xxxxx X. Field nor a successor executive having expertise and experience in the
broadcasting industry comparable to that of Xxxxxx X. Field or Xxxxx X. Field
shall be the President and Chief Executive Officer of the Borrower; or the
Borrower shall cease to own a 99% general partnership interest in the License
Partnership (unless all the Licenses held by the License Subsidiary have been
transferred to a wholly owned Subsidiary of the Borrower pursuant to Section
8.10(c) hereof).
9.12 Condemnation. Any court, government or governmental agency shall
condemn, seize or otherwise appropriate, or take custody or control of any
substantial portion of the assets of the Borrower or any of its Subsidiaries
pursuant to a final, non-appealable order unless such taking could not
reasonably be expected to have a Material Adverse Effect.
9.13 Cessation of Operations. The Borrower's on-the-air broadcast
operations at any Station (other than a Station which has not, in the four
quarter period most recently ended prior to the date of determination,
contributed at least 5% to the Operating Cash Flow of the Borrower) shall be
interrupted at any time for more than forty-eight hours, whether or not
consecutive, during any period of five consecutive days, unless (a) the
broadcasting operations of all or substantially all of the radio stations in the
relevant market also are interrupted for a like period of time, or (b) the
Borrower shall be receiving during such period of interruption insurance
sufficient to assure that its per diem Operating Cash Flow during such period is
a least equal to that which could reasonably have been expected during such
period but for the interruption.
9.14 Subordination. The Borrower, the Subordinated Lender or any other
obligee of Subordinated Debt shall fail to comply with the subordination
provisions of the Subordinated Purchase Agreement, any other agreement or
instrument governing or evidencing such Subordinated Debt or any separate
subordination agreement, and the Administrative Agent shall have determined that
such failure to comply could reasonably be expected to have
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a material adverse effect on the Borrower or on its ability to perform its
obligations hereunder or under the Collateral Documents or on the rights and
remedies of the Administrative Agent and the Banks hereunder or under the
Collateral Documents.
9.15 Material Adverse Effect. Any event or circumstance shall occur or
fail to occur or any action shall be taken or fail to be taken if the result of
such occurrence or failure to occur or such action or failure to take action
could reasonably be expected to have a material adverse effect on the ability of
the Borrower to perform its obligations hereunder or under any of the Collateral
Documents.
SECTION 10 REMEDIES.
Notwithstanding any contrary provision or inference herein or
elsewhere,
10.1 Optional Defaults. If any Event of Default referred to in
Section 9.1 through and including Section 9.4 or Section 9.8 through and
including Section 9.15 shall occur, the Issuing Bank shall not be required to
issue any additional Letters of Credit, and the Administrative Agent, with the
consent of the Required Banks, upon written notice to the Borrower, may
(a) terminate the Commitment and the credit hereby
established and forthwith upon such election the obligations of the Banks to
make any further Loans hereunder (other than Loans resulting from the funding of
Letters of Credit) immediately shall be terminated, and/or
(b) accelerate the maturity of the Loans and all other
Obligations, whereupon all Obligations shall become and thereafter be
immediately due and payable in full without any presentment or demand and
without any further or other notice of any kind, all of which are hereby waived
by the Borrower, and/or
(c) demand the payment to the Issuing Bank of the aggregate
stated amount of the outstanding Letters of Credit, which amount the Issuing
Bank shall hold as security for the obligations incurred under the Letters of
Credit.
10.2 Automatic Defaults. If any Event of Default referred to
in Sections 9.5-9.7 shall occur,
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(a) the Commitment and the credit hereby established shall
automatically and forthwith terminate, and the Banks thereafter shall be under
no obligation to grant any further Loans hereunder (other than Loans resulting
from the funding of Letters of Credit), and
(b) the principal of and interest on the Notes, then outstanding,
and all of the other Obligations shall thereupon become and thereafter be
immediately due and payable in full, all without any presentment, demand or
notice of any kind, which are hereby waived by the Borrower, and
(c) the Issuing Bank shall not be required to issue any additional
Letters of Credit, and the aggregate stated amount of the outstanding Letters of
Credit shall be immediately payable by the Borrower to the Issuing Bank, which
amount the Issuing Bank shall hold as security for the obligations incurred
under the Letters of Credit.
10.3 Performance by the Banks. If at any time the Borrower or any of
its Subsidiaries fails or refuses to pay or perform any material obligation or
duty to any third Person, except for payments which are the subject of bona fide
disputes in the ordinary course of business, the Administrative Agent or the
Banks may, in their sole discretion, but shall not be obligated to, pay or
perform the same on behalf of the Borrower or such Subsidiary, and the Borrower
shall promptly repay all amounts so paid, and all costs and expenses so
incurred. This repayment obligation shall become one of the Obligations of the
Borrower hereunder and shall bear interest at the Default Interest Rate.
10.4 Other Remedies. Upon the occurrence of an Event of Default, the
Administrative Agent and the Banks may exercise any other right, power or remedy
as may be provided herein, in the Notes or in any other Collateral Document, or
as may be provided at law or in equity, including, without limitation, the right
to recover judgment against the Borrower for any amount due either before,
during or after any proceedings for the enforcement of any security or any
realization upon any security.
10.5 Enforcement and Waiver by the Banks. The Administrative Agent and
the Banks shall have the right at all
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times to enforce the provisions of this Agreement and all Collateral Documents
in strict accordance with the terms hereof and thereof, notwithstanding any
conduct or custom on the part of the Administrative Agent or the Banks in
refraining from so doing at any time, unless the Administrative Agent or the
Banks shall have waived such enforcement in writing in respect of a particular
instance. The failure of the Administrative Agent or the Banks at any time to
enforce their rights under such provisions shall not be construed as having
created a custom or course of dealing in any way contrary to the specific
provisions of this Agreement or the Collateral Documents, or as having in any
way modified or waived the same. All rights, powers and remedies of the
Administrative Agent and the Banks are cumulative and concurrent and the
exercise of one right, power or remedy shall not be deemed a waiver or release
of any other right, power or remedy.
SECTION 11 THE AGENTS.
11.1 Appointment. KCCI is hereby appointed documentation agent and
administrative agent hereunder, and each of the Banks irrevocably authorizes
KCCI to act as the documentation agent and administrative agent of such Bank.
Bank of America National Trust and Savings Association is hereby appointed
syndication agent hereunder, and each of the Banks irrevocably authorizes Bank
of America National Trust and Savings Association to act as the syndication
agent of such Bank. The Agents agree to act as such upon the express conditions
contained in this Section 11. Neither the Administrative Agent nor the
Syndication Agent shall have a fiduciary relationship in respect of any Bank by
reason of this Agreement.
11.2 Powers. The Administrative Agent shall have and may exercise such
powers hereunder as are specifically delegated to it by the terms hereof,
together with such powers as are reasonably incidental thereto. The
Administrative Agent shall not have any implied duties or any obligation to the
Banks to take any action hereunder except any action specifically provided by
this Agreement to be taken by the Administrative Agent.
11.3 General Immunity. Neither the Administrative Agent, nor the
Syndication Agent nor any of their respective directors, officers, affiliates,
agents or employees shall be liable to the Banks or any Bank for any action
taken or omitted
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to be taken by it or them hereunder or in connection herewith except for its or
their own gross negligence or wilful misconduct. Without limiting the foregoing,
neither the Administrative Agent, nor the Syndication Agent nor any of their
respective directors, officers, affiliates, agents or employees shall be
responsible for, or have any duty to examine (a) the genuineness, execution,
validity, effectiveness, enforceability, value or sufficiency of this Agreement,
any Collateral Document, or any other document or instrument furnished pursuant
to or in connection with this Agreement or any Collateral Document, (b) the
collectibility of any amounts owed by the Borrower or any of its Subsidiaries,
(c) any recitals, statements, reports, representations or warranties made in
connection with this Agreement or any Collateral Document, (d) the performance
or satisfaction by the Borrower or any Subsidiary of any covenant or agreement
contained herein or in any Collateral Document, (e) any failure of any party to
this Agreement to receive any communication sent, including any telegram,
teletype, bank wire, cable, radiogram or telephone message sent or any writing,
application, notice, report, statement, certificate, resolution, request, order,
consent letter or other instrument or paper or communication entrusted to the
mails or to a delivery service, or (f) the assets or liabilities or financial
condition or results of operations or business or credit-worthiness of the
Borrower or any of its Subsidiaries. The Administrative Agent shall not be bound
to ascertain or inquire as to the performance or observance of any of the terms
of this Agreement or any Collateral Document.
11.4 Action on Instructions of the Banks. The Administrative Agent
shall not be required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the instructions of the Required Banks
(subject to Section 11.12 hereof), and such instructions shall be binding upon
all the Banks and all holders of the Notes; provided, however, that the
Administrative Agent shall not be required to take any action which exposes it
to personal liability or which is contrary to this Agreement or applicable law.
The foregoing provisions of this Section 11.4 shall not limit in any way the
exercise by any Bank of any right or remedy granted to such Bank pursuant to the
terms of this Agreement or any Collateral Document. Except as otherwise
expressly provided herein, any reference in this Agreement to action by the
Banks shall be deemed to be a reference to the Required Banks.
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11.5 Employment of Agents and Counsel. The Administrative Agent may
execute any of its duties as Administrative Agent hereunder by or through
employees, agents and attorneys-in-fact and shall not be answerable to the
Banks, except as to money or securities received by it or its authorized agents,
for the default or misconduct of any such agents or attorneys-in-fact selected
by it with reasonable care.
11.6 Reliance on Documents; Counsel. The Administrative Agent shall be
entitled to rely upon any Note, notice, consent, certificate, affidavit, letter,
telegram, statement, paper, document or other communication believed by it to be
genuine and correct and to have been signed or sent by the proper person or
persons, and, with respect to legal matters, upon the opinion of counsel
selected by the Administrative Agent, which counsel may be employees of the
Administrative Agent, concerning all matters pertaining to the agency hereby
created and its duties hereunder.
11.7 Administrative Agent's Reimbursement and Indemnification. The
Banks agree to reimburse and indemnify the Administrative Agent (which
indemnification shall be shared by the Banks ratably in proportion to their
respective Ratable Shares of the Loans) (a) for any amounts not reimbursed by
the Borrower for which the Administrative Agent is entitled to reimbursement by
the Borrower hereunder or under any Collateral Document, (b) for any other
expenses reasonably incurred by the Administrative Agent on behalf of the Banks,
in connection with the preparation, execution, delivery, administration,
amendment or enforcement hereof or of any of the Collateral Documents and (c)
for any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to or arising out of this Agreement,
any Collateral Document or any other document related hereto or thereto or the
transactions contemplated hereby or the enforcement of any of the terms hereof
or thereof or of any such other documents, provided that no Bank shall be liable
for any of the foregoing to the extent they arise from the gross negligence or
willful misconduct of the Administrative Agent.
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11.8 Rights as a Bank. With respect to its Ratable Share of the
Commitment, the Loans made by it, the Letters of Credit issued by the Issuing
Bank and the Notes issued to it, each of the Administrative Agent and the
Syndication Agent shall have the same rights and powers hereunder as any Bank
and may exercise the same as though it were not the Administrative Agent or the
Syndication Agent, as the case may be, and the term "Bank" or "Banks" shall,
unless the context otherwise indicates, include the Administrative Agent and the
Syndication Agent in their individual capacities. Each of the Administrative
Agent and the Syndication Agent may accept deposits from, lend money to, and
generally engage in any kind of banking or trust business with the Borrower or
any of its Subsidiaries as if it were not the Administrative Agent or the
Syndication Agent hereunder.
11.9 Bank Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Bank and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other
Collateral Documents. Each Bank also acknowledges that it will, independently
and without reliance upon the Administrative Agent or any other Bank 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
this Agreement and the other Collateral Documents. The Administrative Agent
shall not be required to keep the Banks informed as to the performance or
observance by the Borrower and its Subsidiaries of this Agreement or any other
document referred to or provided for herein or to inspect the properties or
books of the Borrower or any of its Subsidiaries. Except for notices, reports
and other documents and information expressly required to be furnished to the
Banks by the Administrative Agent hereunder, the Administrative Agent shall not
have any duty or responsibility to provide any Bank with any credit or other
information concerning the affairs, financial condition or business of the
Borrower or any of its Subsidiaries which may come into its possession.
11.10 Successor Administrative Agent.
(a) The Administrative Agent may, without the consent of the
Borrower or the other Banks, assign its rights and obligations as Administrative
Agent hereunder and under the
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Collateral Documents to its parent or to any wholly owned subsidiary of its
parent which has capital and retained earnings of at least $500,000,000, and
upon such assignment, the former Administrative Agent shall be deemed to have
retired, and such wholly owned subsidiary shall be deemed to be a successor
Administrative Agent.
(b) The Administrative Agent may resign at any time by giving
written notice thereof to the Banks. Upon any such resignation, the Required
Banks shall have the right to appoint a successor Administrative Agent with the
consent of the Borrower so long as no Event of Default or Possible Default has
occurred and is continuing. If no successor Administrative Agent shall have been
so appointed by the Required Banks and shall have accepted such appointment
within thirty days after the notice of resignation, then the retiring
Administrative Agent may appoint a successor Administrative Agent. Such
successor Administrative Agent shall be a commercial bank having capital and
retained earnings of at least $500,000,000.
(c) Upon the acceptance of any appointment as the Administrative
Agent hereunder by a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the assigning or retiring
Administrative Agent, and the assigning or retiring Administrative Agent shall
be discharged from its duties and obligations hereunder. After any assigning or
retiring Administrative Agent's resignation hereunder as the Administrative
Agent, the provisions of this Section 11 shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as the Administrative Agent hereunder.
11.11 Ratable Sharing. All principal and interest payments on Loans and
commitment fees received by the Administrative Agent shall be remitted to the
Banks in accordance with their Ratable Shares. Any amounts received by the
Administrative Agent or any other Bank upon the sale of any collateral for the
Loans or upon the exercise of any remedies hereunder or under any of the
Collateral Documents or upon the exercise of any right of setoff shall be
remitted to the Banks in accordance with their Ratable Shares of the Loans;
provided, however, that, solely for purposes of the sharing of any amounts
received by the Administrative Agent or any other Bank, if at the
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time of any such receipt the Borrower has defaulted under any agreements
regarding Rate Hedging Obligations entered into pursuant to Section 7.12 with
any Bank or any Affiliate of any Bank, then the Ratable Share of the affected
Bank shall be proportionately increased and the Ratable Shares of the other
Banks shall be proportionately decreased based upon the amount due to the
affected Bank (or such Bank's Affiliate) pursuant to such agreements. If any
Bank shall obtain any payment hereunder (whether voluntary, involuntary, through
exercise of any right of set-off or otherwise) in excess of its Ratable Share,
then such Bank shall immediately remit such excess to the other Banks pro rata.
11.12 Actions by the Administrative Agent and the Banks. The
Administrative Agent shall take formal action following the occurrence of a
Possible Default or an Event of Default only upon the agreement of the Required
Banks; provided, however, that if the Administrative Agent gives notice to the
Banks of a Possible Default or an Event of Default, and the Required Banks
cannot agree (which agreement shall not be unreasonably withheld) on a mutual
course of action within thirty days following such notice, the Administrative
Agent may (but shall not be required to) pursue such legal rights and remedies
against the Borrower as it deems necessary and appropriate to protect the Banks
and any collateral under the circumstances; provided, further, however, that
nothing in this Section shall permit the Administrative Agent to take any action
which pursuant to Section 12.12 would require the consent of all of the Banks
without such consent of all of the Banks.
SECTION 12 MISCELLANEOUS.
12.1 Construction. The provisions of this Agreement shall be in
addition to those of the Collateral Documents and to those of any other
guaranty, security agreement, note or other evidence of the liability relating
to the Borrower held by the Banks, all of which shall be construed as
complementary to each other. Nothing contained herein shall prevent the
Administrative Agent or the Banks from enforcing any or all of such instruments
in accordance with their respective terms. Each right, power or privilege
specified or referred to in this Agreement or in any Collateral Document is in
addition to any other rights, powers or privileges that the Administrative Agent
or the Banks may otherwise have or acquire by operation of law, by other
contract
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or otherwise. No course of dealing in respect of, nor any omission or delay in
the exercise of, any right, power or privilege by the Administrative Agent or
the Banks shall operate as a waiver thereof, nor shall any single or partial
exercise thereof preclude any further or other exercise thereof or of any other,
as each right, power or privilege may be exercised independently or concurrently
with others and as often and in such order as the Administrative Agent or the
Banks may deem expedient. Notwithstanding any other provision of this Agreement,
the Borrower shall not be required to pay any amount of interest pursuant hereto
which is in excess of the maximum amount permitted by law.
12.2 Further Assurance. From time to time, the Borrower shall, and
shall cause its Subsidiaries to, execute and deliver to the Banks such
additional documents and take such actions as the Administrative Agent may
reasonably require to carry out the purposes of this Agreement or any of the
Collateral Documents, or to preserve and protect the rights of the
Administrative Agent and the Banks hereunder or thereunder.
12.3 Expenses of the Administrative Agent and the Banks;
Indemnification.
(a) Whether or not the transactions contemplated by this Agreement
are consummated, the Borrower shall pay the costs and expenses, including the
reasonable fees and disbursements of the Administrative Agent's special counsel,
incurred by the Administrative Agent and the Banks in connection with (i) the
negotiation, preparation, amendment or enforcement of this Agreement and the
Collateral Documents and any amendment or modification thereof and the closing
of the transactions contemplated hereby and thereby; (ii) the perfection of the
Liens granted pursuant hereto and pursuant to the Collateral Documents; (iii)
the making of the Loans and issuance of the Letters of Credit hereunder; (iv)
the negotiation, preparation or enforcement of any other document in connection
with this Agreement, the Collateral Documents or the Loans made hereunder; (v)
any proceeding brought or formal action taken by the Administrative Agent or the
Banks to enforce any provision of this Agreement or any Collateral Document, or
to enforce or exercise any right, power or remedy hereunder or thereunder; or
(vi) any action which may be taken or instituted by any Person against the
Administrative Agent or any Bank as a result of any
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of the foregoing; provided, however, that notwithstanding the foregoing, the
Borrower shall not be responsible for the costs and expenses, including legal
fees, of any Bank other than the Administrative Agent in respect of any period
prior to the occurrence of a Possible Default. The estimated fees and expenses
of the Administrative Agent's special counsel through the Closing shall be paid
on the Closing Date.
(b) The Borrower hereby indemnifies and holds harmless each Agent
and each Bank and their respective directors, officers, employees, agents,
counsel, subsidiaries and affiliates (the "Indemnified Persons") from and
against any and all claims, losses, liabilities, obligations, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever (including, without limitation, reasonable attorneys
fees) which may be imposed on, incurred by, or asserted against any Indemnified
Person in any way relating to or arising out of this Agreement, the Collateral
Documents, or any of them, or the Loans made pursuant hereto, or the Letters of
Credit issued pursuant hereto, or the use of the proceeds of the Loans or any of
the transactions contemplated hereby or thereby or the ownership or operation of
the Stations or any of the other assets of the Borrower or its Subsidiaries or
the breach by the Borrower or any of its Subsidiaries of any of the
representations, warranties, covenants and agreements contained herein or in any
Collateral Document; provided, however, that the Borrower shall not be liable to
any Indemnified Person, if there is a final judicial determination that such
claims, losses, liabilities, obligations, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulted solely from the
gross negligence or willful misconduct of such Indemnified Person; and provided,
further, that notwithstanding the foregoing, the Borrower shall not be
responsible for the costs and expenses, including legal fees, of any Bank other
than the Administrative Agent in respect of any period prior to the occurrence
of a Possible Default which legal fees are incurred by such Bank in connection
with the negotiation, preparation, amendment or modification of this Agreement
and the Collateral Documents and the closing of the transactions contemplated
hereby and thereby.
12.4 Notices. Except as otherwise expressly provided herein, all
notices, demands and requests required or permitted to be given under the
provisions of this Agreement shall be in writing and shall be deemed to have
been duly delivered and
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received (a) on the date of personal delivery, (b) on the date of receipt (as
shown on the return receipt) if mailed by registered or certified mail, postage
prepaid and return receipt requested, (c) on the next business day after
delivery to a courier service that guarantees delivery on the next business day
if the conditions to the courier's guarantee are complied with, or (d) on the
date of receipt by telecopy, in each case addressed as follows:
TO THE ADMINISTRATIVE AGENT:
Key Corporate Capital Inc.
000 Xxxxxx Xxxxxx
X/X XX-00-000-0000
Xxxxxxxxx, Xxxx 00000-0000
Attention: Media and Telecommunications Finance
Division
Telecopy: 000-000-0000
Copy to:
Xxxxxxx X. Xxxxxx, Esq.
Dow, Xxxxxx & Xxxxxxxxx, PLLC
0000 Xxx Xxxxxxxxx Xxx., X.X., Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Telecopy: 202-776-2222
TO THE SYNDICATION AGENT:
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxx
Telecopy: 000-000-0000
TO THE BANKS, AT THE ADDRESSES LISTED ON THE SIGNATURE
PAGES HEREOF OR IN THE ASSIGNMENT INSTRUMENT DELIVERED
PURSUANT TO SECTION 12.7(b)
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TO THE BORROWER OR ANY OF ITS SUBSIDIARIES:
Entertainment Communications, Inc.
000 Xxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx X. Field, Senior Vice President
Telecopy: 000-000-0000
Copy to:
Xxxx X. Xxxxxxxx, Esq.
Executive Vice President and General Counsel
Entertainment Communications, Inc.
000 Xxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxx, Xxxxxxxxxxxx 00000
Telecopy: 000-000-0000
or to such other address or addresses as the party to which such notice is
directed may have designated in writing to the other parties hereto.
12.5 Waiver and Release by the Borrower. Neither the Administrative
Agent, nor the Syndication Agent, nor any Bank, nor any Affiliate, officer,
director, employee, attorney, or agent of the Administrative Agent, the
Syndication Agent or any Bank shall have any liability with respect to, and the
Borrower hereby waives, releases and agrees not to xxx any of them upon, any
claim for any special, indirect, incidental or consequential damages suffered or
incurred by the Borrower or any of its Subsidiaries in connection with, arising
out of, or in any way related to, this Agreement or any of the Collateral
Documents, or any of the transactions contemplated by this Agreement or any of
the Collateral Documents, unless arising from the gross negligence or willful
misconduct of such Person as determined by a final judgment of a court of
competent jurisdiction.
12.6 Right of Set Off. Upon the occurrence and during the continuance
of any Event of Default, each Bank is hereby authorized at any time and from
time to time, to the fullest extent permitted by law, to set-off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held and other indebtedness at any time owing by such Bank or an
Affiliate of such Bank to or for the credit or the account of the Borrower or
any of its Subsidiaries against
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any and all of the obligations of the Borrower or any of its Subsidiaries now or
hereafter existing hereunder or under any Collateral Document, irrespective of
whether or not such Bank shall have made any demand hereunder or under any
Collateral Document and although such obligations may be unmatured. Such Bank
agrees promptly to notify the Administrative Agent and the Borrower after any
such set-off and application made by such Bank; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and
application. The rights of the Banks under this Section are in addition to other
rights and remedies (including without limitation, other rights of set-off)
which the Banks may have. The Borrower agrees, to the fullest extent it may
effectively do so under applicable law, that any holder of a participation in
the Notes may exercise rights of set-off or counterclaim and other rights with
respect to such participation as fully as if such holder of a participation were
a direct creditor of the Borrower or any of its Subsidiaries in the amount of
such participation.
12.7 Successors and Assigns; Participations.
(a) Whenever in this Agreement any of the parties hereto is
referred to, such reference shall be deemed to include the successors and
assigns of such party; provided, however, that the Borrower may not assign or
transfer any of its rights or obligations hereunder or under the Notes without
the prior written consent of all of the Banks and the Administrative Agent.
(b) Each Bank may assign all or any part of any of its Loans, its
Notes, and its share of the Commitment and the Letters of Credit with the
consent of the Borrower and the Administrative Agent, which consent shall not be
unreasonably withheld; provided that (i) no such consent by the Borrower shall
be required (A) for any such assignment by any Bank to an Affiliate of such
Bank, (B) if, at the time of such assignment, an Event of Default or Possible
Default has occurred and is continuing, (C) in the case of any assignment to
another branch or a principal office of a Bank, or (D) for any such assignment
to another Bank or an Affiliate of another Bank; (ii) any such partial
assignment shall be in an amount at least equal to $5,000,000; and (iii) each
such assignment shall be made by a Bank in such manner that the same portion of
its Loans, its Notes, its share of the Commitment and its participation in the
Letters of Credit is assigned to the assignee. Upon execution
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and delivery by the assignor and the assignee to the Borrower and the
Administrative Agent of an instrument in writing pursuant to which such assignee
agrees to become a "Bank" hereunder (if not already a Bank) having the share of
the Commitment, the Loans and the Letters of Credit specified in such
instrument, and upon consent thereto by the Administrative Agent and the
Borrower (to the extent required), the assignee shall have, to the extent of
such assignment (unless otherwise provided in such assignment with the consent
of the Administrative Agent), the obligations, rights and benefits of a Bank
hereunder holding the share of the Commitment, the Loans and the Letters of
Credit (or portions thereof) assigned to it (in addition to the share of the
Commitment, the Loans and the Letters of Credit, if any, theretofore held by
such assignee) and the assigning Bank shall, to the extent of such assignment,
be released from the share of the Commitment and the obligations hereunder so
assigned.
(c) Upon its receipt of an assignment pursuant to Section 12.7(b)
above duly executed by an assigning Bank and the assignee, together with any
Notes subject to such assignment and the Administrative Agent's standard
processing and recordation fee of $3,500, the Administrative Agent shall, if
such assignment has been completed, accept such assignment. Within five business
days after receipt of such notice, the Borrower, at the Borrower's own expense,
shall execute and deliver to the Administrative Agent in exchange for the
surrendered Notes new Notes to the order of the assignee in an amount equal to
the share of the Commitment, the Loans and the Letters of Credit assumed by the
assignee and, if the assigning Bank has retained a portion of the Commitment,
the Loans and the Letters of Credit hereunder, new Notes to the order of the
assigning Bank in an amount equal to the share of the Commitment and the Loans
retained by it hereunder. Such new Notes shall be in an aggregate principal
amount equal to the aggregate principal amount of such surrendered Notes, shall
be dated the effective date of such assignment and shall otherwise be in
substantially the form of Exhibit A hereto. Cancelled Notes shall be returned to
the Borrower.
(d) A Bank may sell or agree to sell to one or more other Persons
(each, a "Participant") a participation in all or any part of any Loans held by
it, or in its share of the Commitment and the Letters of Credit. Except as
otherwise provided in the last sentence of this Section 12.7(d), no
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Participant shall have any rights or benefits under this Agreement or any Note
or any other Collateral Documents (the Participant's rights against such Bank in
respect of such participation to be those set forth in the agreements executed
by such Bank in favor of the Participant). All amounts payable by the Borrower
to any Bank under Section 2 hereof in respect of Loans held by it, and its share
of the Commitment and of the Letters of Credit, shall be determined as if such
Bank had not sold or agreed to sell any participations in such Loans and share
of the Commitment, and as if such Bank were funding each of such Loans and its
share of the Commitment in the same way that it is funding the portion of such
Loans and its share of the Commitment in which no participations have been sold.
In no event shall a Bank that sells a participation agree with the Participant
to take or refrain from taking any action hereunder or under any other
Collateral Document except that such Bank may agree with the Participant that it
will not, without the consent of the Participant, agree to any modification,
supplement or waiver hereof or of any of the other Collateral Documents to the
extent that the same, under Section 12.12 hereof, requires the consent of each
Bank. The Borrower agrees that each Participant shall be entitled to the
benefits of Sections 2.7 through 2.14 and Section 12.6 with respect to its
participating interest.
(e) In addition to the assignments and participations permitted
under the foregoing provisions of this Section 12.7, any Bank may assign and
pledge all or any portion of its Loans and its Notes to any Federal Reserve Bank
as collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any Operating Circular issued by such Federal Reserve
Bank. No such assignment shall release the assigning Bank from its obligations
hereunder.
(f) A Bank may furnish any information concerning the Borrower and
its Subsidiaries in the possession of such Bank from time to time to assignees
and participants (including prospective assignees and participants).
(g) Anything in this Section 12.7 to the contrary notwithstanding,
no Bank may assign or participate any interest in any Loan held by it hereunder
to the Borrower or any of its Affiliates without the prior written consent of
all of the Banks.
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123
12.8 Applicable Law. This Agreement and the Collateral Documents, and
the duties, rights, powers and remedies of the parties hereto and thereto, shall
be construed in accordance with, and governed by, the laws of the State of Ohio,
without regard to the conflicts of laws provisions thereof, except to the extent
that any Collateral Document provides that the local law of another jurisdiction
governs the grant, perfection or enforcement of the Liens granted pursuant to
such Collateral Document.
12.9 Binding Effect and Entire Agreement. This Agreement shall inure to
the benefit of, and shall be binding upon, the respective successors and
permitted assigns of the parties hereto. This Agreement, the Schedules and
Exhibits hereto, which are hereby incorporated in this Agreement, and the
Collateral Documents constitute the entire agreement among the parties on the
subject matter hereof.
12.10 Counterparts. This Agreement may be executed in any number of
counterparts or duplicate originals, each of which shall be deemed to be an
original, but all of which together shall constitute one and the same
instrument.
12.11 Survival of Agreements. All covenants, agreements,
representations and warranties made herein or in any Collateral Document shall
survive any investigation and the Closing and shall continue in full force and
effect so long as any of the Obligations remain to be performed or paid or the
Banks have any obligation to advance sums or issue Letters of Credit hereunder
or any Letter of Credit remains outstanding.
12.12 Modification. Any term of this Agreement or of the Notes may be
amended and the observance of any term of this Agreement or of the Notes may be
waived (either generally or in a particular instance and either retroactively or
prospectively) only with the written consent of the Borrower and the Required
Banks; provided, however, that no such amendment or waiver or other action
shall, without the prior written consent of all of the Banks or the holders of
all of the Notes at the time outstanding, (a) extend the maturity or reduce the
principal amount of, or reduce the rate or extend the time of payment of
interest on, or reduce the amount or extend the time of payment of any principal
installment of, any Note, (b) reduce the amount or extend the time of payment of
the commitment fees or the fees
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124
shared by the Banks and payable in respect of Letters of Credit, (c) change the
Commitment or the Ratable Share of any Bank (other than any change in Commitment
or Ratable Share resulting from (i) the sale of a participation in or assignment
of any Bank's interest in the Commitment and Loans in accordance with subsection
12.7 or (ii) an increase in the Commitment pursuant to Section 2.15), (d) change
the percentage referred to in the definition of "Required Banks" contained in
Section 1.1, (e) amend this Section 12.12, (f) amend or waive compliance with
Section 2.1(b) or 2.6(b), or (g) release any collateral for the Loans except in
connection with a sale or other disposition permitted pursuant to Section 8.10;
and provided, further, that notwithstanding the foregoing provisions of this
Section 12.12, this Agreement and the Notes may be amended or modified in the
manner contemplated by Section 12.7 for the purpose of permitting any Bank to
assign its interest, rights and obligations hereunder to another Person if the
appropriate assignment agreement or counterparts thereof are executed by the
Borrower (to the extent required), the Administrative Agent and the appropriate
Bank assignor and assignee. Any amendment or waiver effected in accordance with
this Section 12.12 shall be binding upon each holder of any Note at the time
outstanding, each future holder of any Note and the Borrower.
12.13 Separability. If any one or more of the provisions contained in
this Agreement or any Collateral Document should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of all
remaining provisions shall not in any way be affected or impaired. 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 or
affecting the validity or enforceability of such provision in any other
jurisdiction.
12.14 Section Headings. The section headings contained herein are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
12.15 Enforcement. The Borrower (a) hereby irrevocably submits to the
jurisdiction of the state courts of the State of Ohio and to the jurisdiction of
the United States District Court for the Northern District of Ohio, for the
purpose
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125
of any suit, action or other proceeding arising out of or based upon this
Agreement or any Collateral Document or the subject matter hereof or thereof
brought by the Administrative Agent or the Banks or their successors or assigns
and (b) hereby waives, and agrees not to assert, by way of motion, as a defense,
or otherwise, in any such suit, action or proceeding, any claim that it is not
subject personally to the jurisdiction of the above-named courts, that its
property is exempt or immune from attachment or execution, that the suit, action
or proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper or that this Agreement or any Collateral
Document or the subject matter hereof or thereof may not be enforced in or by
such court, and (c) hereby waives and agrees not to seek any review by any court
of any other jurisdiction which may be called upon to grant an enforcement of
the judgment of any such Ohio state or federal court. The Borrower hereby
consents to service of process by registered mail at the address to which
notices are to be given. The Borrower agrees that its submission to jurisdiction
and its consent to service of process by mail is made for the express benefit of
the Administrative Agent and the Banks. Final judgment against the Borrower in
any such action, suit or proceeding may be enforced in other jurisdictions by
suit, action or proceeding on the judgment, or in any other manner provided by
or pursuant to the laws of such other jurisdiction; provided, however, that the
Administrative Agent or the Banks may at their option bring suit, or institute
other judicial proceedings, against the Borrower or any of its assets in any
state or federal court of the United States or of any country or place where the
Borrower, or such assets, may be found.
12.16 Termination. This Agreement shall terminate when all amounts due
hereunder, under the Notes and under each Collateral Document shall have been
indefeasibly paid in full in cash and all other Obligations hereunder or
thereunder shall have been fully performed, so long as no Letters of Credit are
then outstanding and the Banks have no further obligation to advance sums or
issue Letters of Credit hereunder. Upon such termination, at the request of the
Borrower, the Administrative Agent and the Banks shall release all Liens granted
herein or in any Collateral Document at the Borrower's expense and return all
collateral held pursuant hereto or to any Collateral Document without recourse
or representation. Notwithstanding anything to the contrary contained herein,
each expense reimbursement and
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126
indemnification provision in this Agreement or in any Collateral Document shall
survive the repayment in full of the Loans and the termination of this
Agreement.
12.17 FCC Compliance.
(a) Notwithstanding anything herein or in any of the Collateral
Documents to the contrary, but without limiting or waiving the Borrower's or any
of its Subsidiaries' obligations hereunder or under any of the Collateral
Documents, the Administrative Agent's and the Banks' remedies hereunder and
under the Collateral Documents are subject to compliance with the Communications
Act of 1934, as amended, and to all applicable rules, regulations and policies
of the FCC, and neither the Administrative Agent nor the Banks will take any
action pursuant to this Agreement or any of the Collateral Documents that will
constitute or result in any assignment of a License issued by the FCC or any
change of control of the Borrower or any of its Subsidiaries which owns any FCC
License if such assignment of License or change of control would require under
then existing law (including the written rules and regulations promulgated by
the FCC), the prior approval of the FCC, without first obtaining such approval
of the FCC. This Agreement, the Collateral Documents and the transactions
contemplated hereby and thereby do not and will not constitute, create, or have
the effect of constituting or creating, directly or indirectly, actual or
practical ownership of the Borrower or any of its Subsidiaries by the
Administrative Agent or the Banks or control, affirmative or negative, direct or
indirect, of the Borrower or any of its Subsidiaries by the Administrative Agent
or the Banks, over the management or any other aspect of the operation of the
Borrower or any of its Subsidiaries, which ownership and control remain
exclusively and at all times in the stockholders and directors of the Borrower
and its Subsidiaries until such time as the Administrative Agent and the Banks
have complied with such law, rules, regulations and policies.
(b) Furthermore, the parties acknowledge their intent that, upon
the occurrence of an Event of Default, the Banks shall receive, to the fullest
extent permitted by applicable law and governmental policy (including, without
limitation, the rules, regulations and policies of the FCC), all rights
necessary or desirable to obtain, use or sell the Licenses and the collateral
securing the Loans, and to exercise all remedies available to
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127
them under this Agreement, the Collateral Documents, the Uniform Commercial Code
or other applicable law. Therefore, the parties agree that, in the event of
changes in law or governmental policy occurring after the date hereof that
affect in any manner the Administrative Agent's or the Banks' rights of access
to, or use or sale of, the Licenses or such collateral, or the procedures
necessary to enable the Administrative Agent or the Banks to obtain such rights
of access, use or sale, the Administrative Agent, the Banks and the Borrower
shall amend this Agreement and the Collateral Documents in such manner as the
Administrative Agent shall reasonably request, in order to provide the
Administrative Agent and the Banks such rights to the greatest extent possible
consistent with then applicable law and governmental policy.
12.18 Jury Trial Waiver. THE BORROWER, THE AGENTS AND THE BANKS EACH
WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE, BETWEEN THE BANKS AND THE BORROWER
ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT OR THE
NOTES OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO. THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE
FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION,
INCLUDING WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THE BORROWER, THE AGENTS
AND THE BANKS ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER
INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THE WAIVER IN
ENTERING INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER
IN THEIR RELATED FUTURE DEALINGS. THE BORROWER, THE AGENTS AND THE BANKS FURTHER
WARRANT AND REPRESENT THAT EACH HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL,
AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (UNLESS EXPRESSLY MODIFIED IN
WRITING BY ALL PARIES HERETO), AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, THE COLLATERAL DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS
RELATING TO THE LOANS. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED
AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
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128
12.19 Sale as a Going Concern. Notwithstanding anything to the contrary
in this Agreement, the Security Agreements, the Pledge Agreements or any other
Collateral Document, the Administrative Agent and the Banks acknowledge that the
value of each Station as a going concern is, as of the date hereof,
significantly greater than the sum of the values of the individual collateral
used in the operation of that Station in which the Administrative Agent, for the
benefit of the Banks, has been granted a lien or security interest. Therefore,
the Administrative Agent and the Banks agree that upon any foreclosure of their
liens or security interests in the assets of such Station pursuant to the
Collateral Documents, they shall first attempt to sell such Station as a going
concern and that they shall not sell such collateral separately unless (a) the
Borrower or any of its Subsidiaries (or any of their respective agents,
representatives or employees) has refused to cooperate fully in connection with
the Administrative Agent's or the Banks' exercise of their remedies hereunder,
(b) the Administrative Agent has attempted to sell such Station as a going
concern and, after reasonable efforts, has not been able to do so, or (c) the
Administrative Agent determines in its sole discretion that selling such Station
as a going concern is not feasible for any reason or is not likely to permit the
Administrative Agent or the Banks to raise sufficient funds to pay in full the
Obligations secured by the Collateral Documents. Notwithstanding anything herein
to the contrary, the Administrative Agent and the Banks shall have the right, in
their sole discretion, but subject to the terms and conditions of the Collateral
Documents, (i) to sell any Station or group of Stations individually without
being required to sell all of the Stations in one transaction, and (ii) to
exercise their remedies under the Pledge Agreements prior to any exercise of
remedies under the other Collateral Documents provided that anything to the
contrary herein notwithstanding the exercise of such remedies shall be conducted
in a commercially reasonable manner.
12.20 Marshaling; Payments Set Aside. Subject to Section 12.19, the
Administrative Agent and the Banks shall not be under any obligation to marshal
any assets in favor of the Borrower or any other Person or against or in payment
of any or all of the Obligations. To the extent that the Borrower or any of its
Subsidiaries makes a payment or payments to the Administrative Agent or the
Banks or the Administrative Agent or
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129
any Bank enforces its security interest or exercises its rights of setoff, and
such payment or payments or the process of such enforcement or setoff or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a trustee, receiver or any
other party under any bankruptcy or insolvency law, state or federal law, common
law or equitable cause, then to the extent of such recovery, the Obligations or
part thereof originally intended to be satisfied, and all Liens, rights and
remedies therefor, shall be revived and continued in full force and effect as if
such payment had not been made or such enforcement had not occurred.
[SIGNATURE PAGES FOLLOW]
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130
TO WITNESS THE ABOVE, the Borrower, the Banks and the Agents have
caused this Loan Agreement to be executed by their respective representatives
thereunto duly authorized as of the date first above written.
BORROWER:
ENTERTAINMENT COMMUNICATIONS, INC.
By:___________________________
Name:_________________________
Title:________________________
BANKS:
KEY CORPORATE CAPITAL INC.
By:___________________________
Name: Xxxxxxx X. St. Pierre
Title: Vice President
Address: 000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000-0000
Attention: Media and Telecommunications Finance
Division
BANK OF AMERICA, NATIONAL TRUST AND SAVINGS ASSOCIATION
By:___________________________
Name:_________________________
Title:________________________
Address: 000 Xxxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxx
131
CIBC XXXXXXXXXXX CORP.
By:___________________________
Name:_________________________
Title:________________________
Address: 000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxxx
FIRST UNION NATIONAL BANK
By:___________________________
Name:_________________________
Title:________________________
Address: One First Union Center
DC5-NC 0735
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Xxxx Xxxxxxxxxx
FLEET BANK, N.A.
By:___________________________
Name:_________________________
Title:________________________
Address: Media & Communications Group
0000 Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Mailstop: NY/NY/S16K
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxx
132
U.S. BANK, N.A.
By:___________________________
Name:_________________________
Title:________________________
Address: 0000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
BANK OF MONTREAL
By:___________________________
Name:_________________________
Title:________________________
Address: 000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxxxxxx
COMPAGNIE FINANCIERE DE CIC
ET DE L'UNION EUROPEENNE
By:___________________________
Name:_________________________
Title:________________________
By:___________________________
Name:_________________________
Title:________________________
Address: 000 Xxxxxxx Xxxxxx,
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X'Xxxxx
133
FIRST HAWAIIAN BANK
By:___________________________
Name:_________________________
Title:________________________
Address: Media Finance Division
000 Xxxxxx Xx., 00xx Xxxxx
Xxxxxxxx, Xxxxxx 00000
Attention: Xxx Xxxx
SUNTRUST BANK, CENTRAL FLORIDA, N.A.
By:___________________________
Name:_________________________
Title:________________________
Address: 000 Xxxxx Xxxxxx Xxxxxx
Mail Code SOAB4
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxxx
UNION BANK OF CALIFORNIA, N.A.
By:___________________________
Name:_________________________
Title:________________________
Address: 000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxx
ISSUING BANK:
KEY CORPORATE CAPITAL INC.
By:___________________________
Name: Xxxxxxx X. St. Pierre
Title: Vice President
134
ADMINISTRATIVE AGENT:
KEY CORPORATE CAPITAL INC.
By:___________________________
Name: Xxxxxxx X. St. Pierre
Title: Vice President
SYNDICATION AGENT:
BANK OF AMERICA, NATIONAL TRUST AND SAVINGS ASSOCIATION
By:___________________________
Name: ________________________
Title: _______________________
135
LIST OF SCHEDULES AND EXHIBITS
Schedule 1.1 Ratable Shares of the Banks
Exhibit A Form of Note
Exhibit B Financial Statements
Exhibit C Projections
Exhibit D Capitalization
Exhibit E Proceedings, Litigation, Non-
Compliance with Law; Tax Matters
Exhibit F Liens and Indebtedness
Exhibit G Schedule of Contracts, Commitments,
Material Agreements, licenses and
Consents
Exhibit H ERISA Liabilities and Plans
Exhibit I Real Estate
Exhibit J Environmental Matters
Exhibit K Form of Compliance Certificate
Exhibit L Existing Interests in Partnerships
and Joint Ventures
Exhibit M Potential Material Adverse
Contracts
Exhibit N Material Labor Disputes
Exhibit O Request for Borrowing
136
SCHEDULE 1.1
Ratable Shares
Bank: Ratable Share of Commitment
----- and Loans:
---------------------------
KEY CORPORATE CAPITAL INC. 13.3333%
BANK OF AMERICA, NATIONAL
TRUST AND SAVINGS ASSOCIATION 13.3333%
CIBC INC. 11.2500%
FIRST UNION NATIONAL BANK 11.2500%
FLEET BANK, N.A. 11.2500%
BANK OF MONTREAL 11.2500%
COMPAGNIE FINANCIERE DE CIC
ET DE L'UNION EUROPEENNE 6.6667%
SUNTRUST BANK,
CENTRAL FLORIDA, N.A. 6.6667%
UNION BANK OF CALIFORNIA, N.A. 6.6667%
U.S. BANK, N.A. 5.0000%
FIRST HAWAIIAN BANK 3.3333%
--------
Total: 100.000%
=======
137
EXHIBIT A
FORM OF AMENDED AND RESTATED REDUCING REVOLVING CREDIT NOTE
$______________ October 8, 1998
FOR VALUE RECEIVED, ENTERCOM COMMUNICATIONS CORP., a Pennsylvania
corporation (the "Maker"), hereby promises to pay to the order of [BANK] (the
"Payee"), on or before February 13, 2006, in the manner and at the place
provided in the Loan Agreement, as that term is defined below, the principal sum
of $______________, or if less, the outstanding balance of the Loans, as that
term is defined in the Loan Agreement described below, made by the Payee.
The unpaid principal balance of this Note shall bear interest prior to
maturity at the rates determined in accordance with the provisions of that
certain Loan Agreement dated as of February 13, 1998, as amended by the First
Amendment to Loan Agreement, dated as of October 8, 1998, among the Maker, Key
Corporate Capital Inc., as Administrative Agent, Bank of America National Trust
and Savings Association, as Syndication Agent, the Payee and the other financial
institutions as may from time to time be parties thereto (as the same may be
further amended, modified, extended or restated from time to time, the "Loan
Agreement"). Interest accrued on each Base Rate Loan shall be paid quarterly in
arrears on each Quarterly Date after the date hereof until such Loan is paid in
full, and interest accrued on each LIBOR Loan shall be paid on the last day of
the Interest Period thereof and, in addition, if such Interest Period is more
than three months, on the day that would have been the last day of such Interest
Period if such Interest Period had been three months.
This Note is an amendment and restatement of the Reducing Revolving Credit
Note dated February 13, 1998, of the Maker to the Payee (the "Original Note")
and not a replacement, substitution or repayment thereof. The indebtedness and
liabilities of the Maker under the Original Note evidenced hereby
138
remain in full force and effect as amended, renewed and extended hereby.
This Note is subject to voluntary and mandatory prepayment in whole or in
part at the times and in the manner specified in the Loan Agreement.
The Payee may enter all amounts of principal borrowed, paid or prepaid at
any time on the grid annexed hereto or on any separate record thereof maintained
by the Payee.
This Note evidences indebtedness of the Maker to the Payee arising under
the Loan Agreement, to which reference is hereby made for a statement of the
rights of the Payee and the duties and obligations of the Maker in relation
thereto, but neither this reference to the Loan Agreement nor any provision
thereof shall affect or impair the absolute and unconditional obligation of the
Maker to pay the principal of and interest on this Note when due.
The principal of and all interest on this Note shall be paid as provided
in the Loan Agreement in immediately available funds constituting lawful money
of the United States of America, not later than 11:00 A.M. (Cleveland time) on
the day when due.
Upon the occurrence of any Event of Default, the entire outstanding
principal amount of this Note and (to the extent permitted by law) unpaid
interest shall bear interest from the date of occurrence of such Event of
Default until the earlier of the date such amount is paid in full and the date
on which such Event of Default is cured or waived in writing at the Default
Interest Rate which shall be payable on demand.
Subject to the provisions of Section 10 of the Loan Agreement, the entire
unpaid principal balance of this Note, together with all interest accrued
thereon, shall become immediately due and payable upon the occurrence of an
Event of Default. Upon the occurrence of any Event of Default, the holder hereof
shall have all of the rights, powers and remedies provided in the Loan Agreement
or in any Collateral Document or at law or in equity. Failure of the Payee or
any holder of this Note to exercise any such right or remedy available hereunder
or under the Loan Agreement or any Collateral Document or at law or in
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139
equity shall not constitute a waiver of the right to exercise subsequently such
option or such other right or remedy.
The payment of this Note is secured by certain Security Agreements,
certain Pledge Agreements and a Guaranty, all as more fully identified in the
Loan Agreement.
To the extent permitted by law, the Maker and each endorser of this Note,
and their respective heirs, successors, legal representatives and assigns,
hereby severally waive presentment; protest and demand; notice of protest,
demand, dishonor and nonpayment; and diligence in collection, and agree to the
application of any bank balance as payment or part payment of this Note or as an
offset hereto as provided in the Loan Agreement, and further agree that the
holder hereof may release all or any part of the collateral given as security
for this Note or any rights of the holder thereunder and may amend this Note
(with the consent of the Maker), without notice to, and without in any way
affecting the liability of, the Maker or any endorser of this Note, and their
respective heirs, successors, legal representatives and assigns.
If at any time the indebtedness evidenced by this Note is collected
through legal proceedings or this Note is placed in the hands of attorneys for
collection, the Maker and each endorser of this Note, and their respective
heirs, successors, legal representatives and assigns, hereby jointly and
severally agree to pay all costs and expenses (including reasonable attorneys'
fees if permitted by law) incurred by the holder of this Note in collecting or
attempting to collect such indebtedness.
The rate of interest payable on this Note from time to time shall in no
event exceed the maximum rate permissible under applicable law. If the rate of
interest payable on this Note is ever reduced as a result of the preceding
sentence and at any time thereafter the maximum rate permitted by applicable law
shall exceed the rate of interest provided for on this Note, then the rate
provided for on this Note shall be increased to the maximum rate permitted by
applicable law for such period as is required so that the total amount of
interest received by the Payee is that which would have been received by the
Payee but for the operation of the preceding sentence.
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140
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE
PROVISIONS OF, THE LAW OF THE STATE OF OHIO, WITHOUT REGARD TO THE CONFLICTS OF
LAW PRINCIPLES THEREOF.
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Loan Agreement.
ENTERCOM COMMUNICATIONS CORP.
By:___________________________
Name:_________________________
Title:________________________
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REVOLVING CREDIT GRID
_____________________
________________________________________________________________________________
AMOUNT AMOUNT UNPAID OFFICER'S
DATE BORROWED PAID BALANCE INITIALS
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
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142
EXHIBIT D
TO
LOAN AGREEMENT
AMONG
ENTERCOM COMMUNICATIONS CORP.,
KEY CORPORATE CAPITAL INC., AS ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS
SYNDICATION AGENT,
AND
THE FINANCIAL INSTITUTIONS WHICH ARE A PARTY THERETO
Capitalization of the Borrower
Loan Agreement Section 5.5
Authorized Shares:
Voting Common Stock 180,000
Non-Voting Common Stock 180,000
-------
Total 360,000
Issued and Outstanding Shares:
Voting Common Stock 72,750
Non-Voting Common Stock 43,650
-------
Total 116,400
Capitalization of the License Partnership:
Interests Held By
99% General Partnership Interest The Borrower
1% Limited Partnership Interest ECI
Investors Corporation
143
Commitments:
The Borrower has committed to issue shares of the capital stock of the Borrower
pursuant to the terms of the Subordinated Purchase Agreement and documents
executed in connection therewith.
144
EXHIBIT E
TO
LOAN AGREEMENT
AMONG
ENTERCOM COMMUNICATIONS CORP.,
KEY CORPORATE CAPITAL INC., AS ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS
SYNDICATION AGENT,
AND
THE FINANCIAL INSTITUTIONS WHICH ARE A PARTY THERETO
Litigation; Proceedings; Compliance; Tax Matters
Loan Agreement Section 5.7, 5.8 and 5.11
The following litigation, proceedings and non-compliance with law are disclosed
pursuant to Section 5.7 and 5.11 of the Loan Agreement:
1 Complaint of gender-based discrimination filed by Xxxxx Xxxxx in the
United States District Court for the Western District of Pennsylvania
on January 14, 1997. The Borrower has answered the Complaint, denying
the allegations, discovery has concluded and Borrower's Motion for
Summary Judgment has been filed. The Borrower does not anticipate an
outcome from this claim that would have a Material Adverse Effect on
the Borrower.
2 Complaint of gender-based discrimination filed by Cassidy Haus with the
Equal Employment Opportunity Commission ("EEOC") on January 25, 1995.
The EEOC dismissed her complaint and provided Xx. Xxxx with notice of
her right to xxx, but she has not yet exercised such right. The
Borrower does not anticipate an outcome from this claim that would have
a Material Adverse Effect on the Borrower.
3 Various Workers' Compensation claims which are being handled
by Borrower's insurance company.
4 The FCC recently denied a Petition for Review of Staff Action
relating to the license renewal by the FCC of Station KISW,
145
which Petition had been filed on November 13, 1996 by Xxxxxxx X.
Xxxxxxx, Xx. The Petition has the effect of preventing the granted
license renewal for KISW from becoming a Final Order. The time for
filing an appeal to the United States Court of Appeals for the D.C.
Circuit has not expired. In addition, Borrower's FCC counsel received
in the mail an informal objection purportedly filed by Xx. Xxxxxxx
against the 1997 application for renewal of the license for Station
KISW, which application has been granted by the FCC. The staff of the
FCC has informally advised Borrower's FCC counsel that the FCC has no
record of the filing of Xx. Xxxxxxx'x latest objection.
5 The Borrower from time to time may be exposed to claims by government
entities for escheat claims and for sales, excise, and similar taxes.
6 The Borrower received a notice from the Kansas City office of the
United States Environmental Protection Agency ("EPA") regarding
liability for 61 pounds of PCB containing materials disposed of by the
Borrower in the early 1980's, originating at a Station in Minnesota
which Borrower sold in 1995, at a licensed incinerator disposal
facility in Kansas City. The site is the subject of an EPA cleanup and
cost recovery operation. EPA has verbally informed the Borrower's
counsel that the Borrower will likely qualify for de minimis status,
and that the Borrower's liability should be less than $10,000. The
Borrower has also been verbally informed that the total cleanup cost
for this site is estimated to be between $12,000,000 to $15,000,000.
7 A complaint alleging race discrimination filed by Xxxx
Xxxxxx with the EEOC on April 1, 1998. The EEOC dismissed
the complaint on August 6, 1998. Xx. Xxxxxx has ninety (90)
days from that date to file a law suit in a state or federal
court.
8 A complaint alleging gender and age discrimination filed by Xxxx Xxxxxx
in the Superior Court of Washington for King County on July 23, 1998.
The case was removed to the United States District Court for the
Western District of Washington at Seattle and Borrower has filed an
answer with that Court denying the substantive allegations asserted.
Discovery is ongoing. The matter is covered under the Borrower's
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146
Employment Practices Liability Insurance policy, which has a $50,000
deductible. The Borrower does not anticipate an outcome from this claim
that would have a Material Adverse Effect on the Borrower.
9 A complaint alleging defamation filed by Xxxxx Xxxx, Xxxxx Xxxx, and
Xxx Xxxx, on behalf of themselves and others similarly situated in the
United States District Court for the Western District of Missouri
Southern Division on August 7, 1998. The Borrower intends to file an
answer with the District Court denying the substantive allegations
asserted. The matter is covered under the Borrower's Broadcasters
Errors and Omissions Insurance policy, which has a $10,000 deductible.
The Borrower does not anticipate an outcome from this claim that would
have a Material Adverse Effect on the Borrower.
10 A complaint alleging gender discrimination filed by Xxxxxx Xxxxxx in
the Superior Court of California for Sacramento County on August 19,
1998. The case was removed to the United States District Court for the
Eastern District of California on September 16, 1998. The Borrower
intends to file an answer with the District Court denying the
substantive allegations asserted. The matter is covered under the
Borrower's Employment Practices Liability Insurance policy, which has a
$50,000 deductible. The Borrower does not anticipate an outcome from
this claim that would have a Material Adverse Effect on the Borrower.
11 In June, 1998, the Borrower received a letter from an attorney
representing Xxxxx Xxxxx, who claims to have been injured at a concert
sponsored by the Borrower's station KNDD in Seattle. No amount has been
demanded and the matter has been turned over to the Borrower's
insurance company, who will provide coverage for this claim. The
Borrower does not anticipate an outcome from this claim that would have
a Material Adverse Effect on the Borrower.
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147
EXHIBIT F
TO
LOAN AGREEMENT
AMONG
ENTERCOM COMMUNICATIONS CORP.,
KEY CORPORATE CAPITAL INC., AS ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS
SYNDICATION AGENT,
AND
THE FINANCIAL INSTITUTIONS WHICH ARE A PARTY THERETO
Indebtedness; Liens
Loan Agreement Sections 1.1, 5.10, and 8.1
In addition to Permitted Liens and Liabilities disclosed elsewhere in this Loan
Agreement, Entercom's Assets are subject to liens and the Borrower has incurred
liabilities as follows:
The following liabilities which the Borrower has or will from time to
time incur are disclosed pursuant to Section 5.10 of the Loan Agreement: (i) all
material leases and contracts which have been disclosed in this Agreement; (ii)
On February 8, 1996 the Borrower entered into a preliminary agreement for the
Borrower to acquire the assets of radio station KWOD-FM, Sacramento, California,
subject to approval by the Borrower's Board of Directors and lenders and the
FCC, for the purchase price of $25,000,000; (iii) all other obligations and
liabilities disclosed in this Loan Agreement and the exhibits and schedules
hereto; (iv) Management and License Agreement with ECI License Company, L.P., a
limited partnership dated December 23, 1992, as amended April 13, 1993, March 3,
1994, June 1, 1994, April 18, 1995, September 1, 1995, March 6, 1996, and August
1, 1996; (v) Interest Rate Agreement with Society National Bank dated May 12,
1995; (vi) employment agreement with Xxxxxx X. Field dated as of January 1,
1989; (vii) contracts relating to the operation of the stations in the ordinary
course of business including without limitation contracts for: (a) Arbitron and
similar services; (b) Tapscan, Strata and similar computer ratings programming
licenses; (c) AP, UPI and similar news services; (d) station traffic and
accounting software licenses; (e) employment agreements with on-air talent;
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148
(f) ASCAP, BMI, SESAC and similar music licensing agreements; (g) Metro Traffic
and similar traffic and information services; (h) Unistar, ABC, Westwood One and
similar news network affiliation agreements; (i) national sales representation
agreements; (j) contracts for television, direct mail, outdoor and other
advertising type services promoting the stations; (k) contracts for audience,
market and music research relating to the operation of the stations; and (l)
contracts for sports broadcast rights.
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149
EXHIBIT G
TO
LOAN AGREEMENT
AMONG
ENTERCOM COMMUNICATIONS CORP.,
KEY CORPORATE CAPITAL INC., AS ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS
SYNDICATION AGENT,
AND
THE FINANCIAL INSTITUTIONS WHICH ARE A PARTY THERETO
Material Contracts and Commitments; Licenses and Operating
Agreements
Loan Agreement Sections 5.14 and 5.16
The following material contracts and commitments, licenses and operating
agreements are disclosed pursuant to paragraph 5.14 and 5.16 of the Loan
Agreement:
1. All agreements and leases disclosed elsewhere in this Loan
Agreement.
2. The FCC licenses listed in the attachment to this Exhibit G.
3. The Entercom 401(k) Savings and Retirement Plan.
4. Management and License Agreement between ECI License Company, L.P., a
Pennsylvania limited partnership and Entertainment Communications,
Inc., dated December 23, 1992, as amended April 13, 1993, March 3,
1994, June 1, 1994, September 1, 1995, March 6, 1996, and August 1,
1996.
5. West Tiger Mountain Master Antenna Owners Operating Agreement, dated
July 26, 1988, Station Five Addition dated December 23, 1991, Station
Six Addition, dated June 4, 1992, Station Seven Addition, dated January
16, 1997, Station Eight Addition, dated January 16, 1997, and Station
Nine Addition, dated January 16, 1997.
150
6. The Borrower has entered into construction contracts relating to studio
expansion projects in Seattle and Gainesville. In connection therewith,
the Borrower has ordered substantial amounts of equipment to be
installed in the expanded studios. All of the costs relating to this
construction and equipment have been estimated and are included in the
capital budgets provided to the Banks.
7. Asset Purchase Agreement, dated August 13, 1998, among CBS Radio, Inc.,
CBS Radio License, Inc. and Borrower pursuant to which Borrower and
License Partnership will acquire substantially all of the assets
relating to radio stations WEEI and WRKO, Boston, Massachusetts
("Boston I Transaction").
8. Asset Purchase Agreement, dated August 13, 1998, among CBS Radio, Inc.,
CBS Radio License, Inc. and Borrower pursuant to which Borrower and
License Partnership will acquire substantially all of the assets
relating to radio stations WAAF and WWTM, Worcester, Massachusetts and
WEGQ, Lawrence, Massachusetts ("Boston II Transaction").
9. Asset Purchase Agreement, dated August 13, 1998, among CBS Radio, Inc.,
CBS Radio License, Inc. and Borrower pursuant to which Borrower and
License Partnership will sell substantially all of the assets relating
to radio stations WYUU, Safety Harbor, Florida and WLLD, Xxxxxx Beach,
Florida ("Tampa Transaction").
10. Agreement, dated February 1, 1995, with Football Northwest, LLC
(Seattle Seahawks) whereby Borrower is granted radio broadcast rights
for the Seattle Seahawks franchise of the National Football League.
11. Interim Agreement, dated February 28, 1997, with the Kansas
City Local of the American Federation of Television and Radio
Artists ("AFTRA"). Negotiations for final collective
bargaining agreement are ongoing.
12. Interim Agreement, dated February 28, 1997, with the Seattle
Local of the AFTRA. Negotiations for final collective
bargaining agreement are ongoing.
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151
13. Radio Broadcast Rights Agreement, dated March 5, 1998, with Kansas City
Royals Baseball Corporation whereby Borrower is granted radio broadcast
rights for the Kansas City Royals franchise of Major League Baseball.
14. Mariners/KIRO Radio Agreement, dated March 6, 1998, with The Baseball
Club of Seattle, L.P. d/b/a Seattle Mariners Baseball Club whereby
Borrower is granted radio broadcast rights for the Seattle Mariners
franchise of Major League Baseball.
15. Agreement, dated January 26, 1998, with Madison Square Garden Network
whereby Borrower is granted radio broadcast rights for New York Yankees
franchise of Major League Baseball. [To be acquired from CBS in Boston
II Transaction.]
16. Agreement, dated March 14, 1994, with Boston Celtics whereby
Borrower is granted radio broadcast rights for Boston Celtics
franchise of National Basketball Association. [To be acquired
from CBS in Boston I Transaction.]
17. Agreement, dated December 14, 1994, with Boston College
whereby Borrower is granted radio broadcast rights for Boston
College football, basketball and hockey games. [To be
acquired from CBS in Boston I Transaction.]
18. Agreement, dated April, 1997, with Boston Red Sox whereby
Borrower is granted radio broadcast rights for Boston Red Sox
franchise of Major League Baseball. [To be acquired from CBS
in Boston I Transaction.]
19. Agreement, undated, with New England Patriots whereby Borrower
is granted radio broadcast rights for New England Patriots
franchise of National Football League. (Currently being
renegotiated for new three season term). [To be acquired from
CBS in Boston I Transaction.]
20. Asset Purchase Agreement, dated September 30, 1998, with Pinnacle
Towers, Inc., pursuant to which Borrower will sell its interests in the
communications tower located in Bradenton, Florida (formerly WLLD's
main transmitter site) for the sum of $300,000 ("Pinnacle
Transaction").
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152
EXHIBIT H
TO
LOAN AGREEMENT
AMONG
ENTERCOM COMMUNICATIONS CORP.,
KEY CORPORATE CAPITAL INC., AS ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS
SYNDICATION AGENT,
AND
THE FINANCIAL INSTITUTIONS WHICH ARE A PARTY THERETO
ERISA Liabilities and Plans
Loan Agreement Section 5.15
The following are the Employee Benefit Plans disclosed pertaining to Section
5.15 of the Loan Agreement (for a more complete description, please see the
attached Entercom Employee Handbook):
1. The Borrower maintains a medical, dental, life, and LTD
insurance plan for its employees and certain employees'
dependents.
2. The Borrower's termination policy.
3. The Borrower's vacation policy.
4. The Borrower's leave policy.
5. Borrower's 401(k) Savings and Retirement Plan, a copy of the summary
booklet describing this plan is attached.
6. Borrower's Section 125 Medical Spending Account Plan and
Dependent Care Spending Account Plan.
153
EXHIBIT I
TO
LOAN AGREEMENT
AMONG
ENTERCOM COMMUNICATIONS CORP.,
KEY CORPORATE CAPITAL INC., AS ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS
SYNDICATION AGENT,
AND
THE FINANCIAL INSTITUTIONS WHICH ARE A PARTY THERETO
Real Estate
Loan Agreement Section 5.21
A. The following is the real estate owned by Borrower:
California
1 KSEG transmitter site at 000 Xxxxx Xxxxxx Xxxxxxxxx,
Xxxxxxxxxx, Sacramento County, California.
2 KCTC nighttime transmitter site at 7907 Antelope North Road,
Sacramento County, California.
Florida
3 WYUU main transmitter site at 00000 Xxxx Xxxxxxxxx, Xxxxxxxx,
Xxxxxxxx Xxxxxx, Xxxxxxx. [This property is to be sold to CBS
in the Tampa Transaction.]
4 WKTK studio site at 1440 N.E. Waldo Road, Gainesville, Alachua
County, Florida.
5 WKTK main transmitter site at Xxxxx 0, Xxxxxxxxx, Xxxx Xxxxxx,
Xxxxxxx.
6 WKTK transmitter site at Xxxxxx Xxxx 000, Xxxx Xxxxxxx, Xxxx
Xxxxxx, Xxxxxxx.
154
Kansas
7 KCMO/KLTH/KMBZ studio and KMBZ transmitter site at 0000 Xxxxxxxx
Xxxx, Xxxxxxxx, Xxxxxxx Xxxxxx, Xxxxxx.
8 WDAF transmitter site at 0000 Xxxxxxx Xxxx, Xxxxxxx
Xxxxxxx, Xxxxxxx Xxxxxx, Xxxxxx.
Massachusetts
9 WEEI transmitter site at 0000 Xxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxx Xxxxxx, Xxxxxxxxxxxxx. [To be acquired in
Boston I Transaction.]
10 WRKO transmitter site at 0 Xxxxx Xxxxxx Xxxx,
Xxxxxxxxxx, Xxxxxxxxx Xxxxxx, Xxxxxxxxxxxxx. [To be
acquired in Boston I Transaction.]
11 WWTM transmitter site at 000 Xxxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxx Xxxxxx, Xxxxxxxxxxxxx. [To be acquired in
Boston II Transaction.]
Missouri
12 Approximately 50 acres of undeveloped land (adjacent to
former KCMO transmitter site) at 000 X.X. Xxxxxxxxxx
Xxxx, Xxxxxx Xxxx, Xxxx Xxxxxx, Xxxxxxxx.
13 KCMO transmitter site at 00000 Xxxxx Xxxxxxx Xxxx,
Xxxxxx Xxxx, Xxxx Xxxxxx, Xxxxxxxx.
New York
14 WBBF transmitter site at 0000 Xxxxx Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxx Xxxxxx, Xxx Xxxx.
Oregon
15 KFXX transmitter site at 00000 X.X. Xxxxxxx Xxxx,
Xxxxxxxxx, Xxxxxxxxx Xxxxxx, Xxxxxx.
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155
Pennsylvania
16 Easement for Spring Hill tower site at 0000 Xxxx Xxxx,
Xxxxxxxxxx, Xxxxxxxxx County, Pennsylvania.
Washington
17 KEDO transmitter site at 0000 Xxxxx Xxx, Xxxxxxxx,
Xxxxxxx Xxxxxx, Xxxxxxxxxx.
18 KLYK transmitter site at 0000 Xx. Xxxxxxx Xxxx, Xxxxx,
Xxxxxxx Xxxxxx, Xxxxxxxxxx.
19 KEDO/KLYK studios at 0000 00xx Xxxxxx, Xxxxxxxx, Xxxxxxx
Xxxxxx, Xxxxxxxxxx.
20 KNDD transmitter site at Cougar Mountain, 0000 000xx
Xxxxxx, X.X., Xxxxxxxx, Xxxxxxxxxx.
21 KNWX transmitter site at 00000 Xxxxxxx Xxxx, X.X.,
Xxxxxx, Xxxx Xxxxxx, Xxxxxxxxxx.
22 KIRO transmitter site at 00000 Xxxxxxx Xxxx, X.X.,
Xxxxxx, Xxxx Xxxxxx, Xxxxxxxxxx.
23 Easement for KIRO transmitter site at Queen Xxxx Xxxx,
Seattle, King County, Washington.
24 KISW studio at 000 Xxxxxx Xxxxxx Xxxxx, Xxxxxxx, Xxxx
Xxxxxx, Xxxxxxxxxx.
25 KISW transmitter site at 0000 Xxxxxxxxx Xxx Xxxxx,
Xxxxxxx, Xxxx Xxxxxx, Xxxxxxxxxx.
26 KBAM transmitter site at 000 Xxxx Xxx Xxxx, Xxxxxxx,
Xxxxxxx Xxxxxx, Xxxxxxxxxx.
B. The following are all of the real estate sites (excluding
sales offices, news bureau offices, storage warehouses, and
parking lots) leased by Borrower:
California
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156
1 KXOA transmitter site at 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxxx
Xxxxxx, Xxxxxxxxxx leased pursuant to Lease with California State
University at Sacramento, dated March 7, 1985.
2 KRXQ/KDND/KSEG/KCTC/KSSJ studios at 0000 Xxxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxxxx, Suite 100 leased pursuant to Lease with
XxXxxxxxx Joint Account, dated November 1, 1988, as amended, and
Suite 300 leased pursuant to Lease with XxXxxxxxx Joint Account,
dated March 13, 1995, as
amended.
3 KBYA transmitter site at 0000 Xxxxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxxxx pursuant to Lease with American Tower Systems, L. P.,
dated June 23, 1997.
4 KCTC daytime transmitter site at 0000 Xxxxxx Xxxxxxx, Xxxxxxxxxx
Xxxxxx, Xxxxxxxxxx leased pursuant to Lease with American Tower
Systems Corporation, dated January
1, 1998.
5 KRXQ transmitter site at 00000 Xxxxxxxxxxxx Xxxx, Xxxxxx,
Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx leased pursuant to Lease with
American Tower Systems, L.P., dated September
16, 1998.
Florida
6 WYUU studio at 0000 Xxxxxxxxx Xxxxxx Xxxxx, Xx.
Xxxxxxxxxx, Xxxxxxxx Xxxxxx, Xxxxxxx, leased pursuant to
Lease with Xxxxx Management, Inc., dated April 24, 1995, as
amended.
7 WYUU auxiliary transmitter site at 00000 Xxxxx
Xxxxxxxxx, Xx. Xxxxxxxxxx, Xxxxxxxx Xxxxxx, Xxxxxxx
leased pursuant to Lease with Lodestar Site Management,
Inc., dated November 1, 1993.
8 WISP main transmitter site at 0000 00xx Xxxxxx, X.X., Xxxxxxxxx,
Xxxxxxx Xxxxxx, Xxxxxxx land leased pursuant to Ground Lease with
Xxxxxx X. Xxxxxx and Xxxxxxx X.
Xxxxxx, dated December 1, 1989.
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157
9 WSKY studio at Xxxx Office Park, 900 N.W. Eighth Avenue,
Gainesville, Alachua County, Florida leased pursuant to
Lease with Xxxxxx X. Xxxx, commencing November 1, 1991,
as amended.
10 WSKY studio at Centroplex Office Park, 3600 N.W. 43rd
Street, Gainesville, Alachua County, Florida leased
pursuant to Lease with Cameo Homes of Florida, Inc.,
commencing November 15, 1998.
11 WRRX transmitter site at Alachua County, Florida leased pursuant
to Lease with Tower Properties of Florida, Inc., dated December
22, 1995.
12 WRRX transmitter site at Alachua County, Florida leased pursuant
to Lease with Tower Properties of Florida, Inc., dated March,
1996.
Kansas
13 KUDL auxiliary transmitter site at 0000 Xxx Xxxxxx, Xxxxxxx,
Xxxxxxx Xxxxxx, Xxxxxx leased pursuant to Lease with TeleCom
Towers Mid-Atlantic, L.P., dated July 24,
1990.
Massachusetts
14 WEEI/WRKO/WEGQ studio site at 000 Xxxxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxx Xxxxxx, Xxxxxxxxxxxxx leased pursuant to Lease with
JMB/Urban Huntington Limited Partnership, dated September 30,
1993, as amended. [To be acquired in Boston I Transaction.]
15 WAAF/WWTM studio site at Two Westborough Business Park, 000
Xxxxxxx Xxxxxxx, Xxxxxxxxxxx, Xxxxxxxxx Xxxxxx, Xxxxxxxxxxxxx
leased pursuant to Lease with Westboro Two Trust, dated May 26,
1995, as amended. [To be acquired in Boston II Transaction.]
16 WAAF tower site (ground) at Asnebumskit Hill, Paxton, Worcester
County, Massachusetts leased pursuant to Lease with Radio Tower
Communications Corp., dated January 1, 1996. [To be acquired in
Boston II Transaction.]
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158
17 WAAF tower site at Asnebumskit Hill, Paxton, Worcester
County, Massachusetts leased pursuant to Lease with Xxxx
and Xxxxxx Xxxxx, dated February 18, 1982. [To be
acquired in Boston II Transaction.]
18 WEGQ tower site at 000 Xxxxxxxx Xxxx Xxxxx, Xxxxxxx,
Xxxxx Xxxxxx, Xxxxxxxxxxxxx leased pursuant to Lease
with American Tower Systems, L. P., dated August 8,
1996. [To be acquired in Boston II Transaction.]
Missouri
19 KYYS tower site at 00xx Xxxxxx and Topping Avenue, Kansas City,
Xxxxxxx County, Missouri leased pursuant to Lease with KMBC
Division of the Hearst Corporation, dated October 9, 1989.
20 KCMO(AM) tower site at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxxx leased pursuant to Lease with Xxxxxxxx
Corporation, dated June 21, 1983.
21 KUDL transmitter site land at 2800 Xxxxxxx, Kansas City, Xxxxxxx
County, Missouri leased pursuant to Ground Lease with Bonanza
Gardens Investments, Inc., dated June 23, 1986, as amended.
00 XXXX XXX antenna site at 0000 Xxxxxx, Xxxxxx Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxxx leased pursuant to Lease with CBS Radio, Inc.,
dated January 1, 1998.
New York
23 WBEE transmitter site at 0000 Xxxx Xxxx Xxxx Xxxx, Xxxxxxxx,
Xxxxxx Xxxxxx, Xxx Xxxx leased pursuant to Lease with Xxxxxxx X.
Xxxxxxxx, dated May 13, 1980, which includes an option to
purchase.
24 WBEE/WBBF/WKLX studios at Suite 500, X. Xxxxxx Building,
Midtown Plaza, Rochester, Monroe County, New York leased
pursuant to Lease with XxXxxxx & Company, Inc., dated
July 1, 1983, as amended.
- 6 -
159
25 WQRV studio at 0000 Xxxxx Xxxx Xxxx, Xxxx, Xxxxxxxxxx Xxxxxx, Xxx
Xxxx, leased pursuant to Lease with Radio Xxxxxxxxxx, X.X., dated
December 26, 1996.
26 WKLX transmitter site at 000 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxx
Xxxxxx, Xxx Xxxx leased pursuant to Lease with Sky Broadcasting
of Rochester, Inc., dated August 3, 1987.
27 WQRV transmitter (land) site at 0000 Xxxx Xxxx-Xxxx Xxxx, Xxxx,
Xxxxxxxxxx Xxxxxx, Xxx Xxxx leased pursuant to Ground Lease with
Xxxxxx X. Ulrop, dated June 2, 1992.
28 WQRV transmitter (tower) site at 0000 Xxxx Xxxx-Xxxx
Xxxx, Xxxx, Xxxxxxxxxx Xxxxxx, Xxx Xxxx leased pursuant
to Lease with Genesee County Video Corp., dated July 1,
1993.
Oregon
29 KGON/KNRK/KFXX studios at 000 X.X. Xxxxxxxx Xxxxxx, Xxxxxxxxx
Xxxxxx, Xxxxxxxx, Xxxxxx pursuant to Lease with T & E
Investments, dated May 5, 1997.
30 KNRK transmitter site at Mt. Xxxxx, 0000 X.X. Xxxx Xxxx Xxxxx,
Xxxxx Xxxxxx, Xxxxxxxxx Xxxxxx, Xxxxxx leased pursuant to Lease
with Portland General Electric Company, dated October 8, 1992, as
amended.
31 KGON transmitter site at S.W.19th Avenue and Seymour Street,
Portland, Multnomah County, Oregon leased pursuant to Lease with
KSGO/KGON, Inc., dated October 15, 1992.
32 KNRK auxiliary transmitter site at Mt. Xxxxx, Mt. Xxxxx
Water Tower, X.X. Xxxxxxxx Drive, Happy Valley,
Clackamas County, Oregon leased pursuant to Lease with
American Radio Systems Corporation, dated November 14,
1997.
33 KKSN(AM/FM)/KRSK studios at 000 X.X. Xxxxx Xxxxxx,
Xxxxxxxx, Xxxxxxxxx Xxxxxx, Xxxxxx leased pursuant to
- 7 -
160
Lease with Pioneer Office Limited Partnership, dated February 22,
1993, as amended.
34 KRSK transmitter (land) site at High Camp Road, Mollala,
Clackamas County, Oregon leased pursuant to Ground Lease with
Cavenham Forest Industries, Inc., dated September 1, 1986, as
amended.
00 XXXX(XX) xxxxxxxxxxx (xxxxx) site at 0000 Xxxxxxx Xxxxx Xxxxx,
Xxxxxxxx, Xxxxxxxxx Xxxxxx, Xxxxxx leased pursuant to Lease with
KSGO/KGON, Inc., dated October 16, 1989.
00 XXXX(XX) xxxxxxxxxxx (xxxx) site at 0000 X.X. 000xx
Xxxxxx, Xxxxxxxx, Xxxxxxxxx Xxxxxx, Xxxxxx leased pursuant to
Ground Lease with Xxx X. Xxxxxx, dated January 18, 1980, as
amended.
Pennsylvania
37 Borrower's corporate offices at 000 Xxxx Xxxxxx, Xxxxx 000, Xxxx
Xxxxxx, Xxxxxxxxxx Xxxxxx, Xxxxxxxxxxxx leased pursuant to Lease
with The Equitable Life Assurance Company of the United States,
dated July 24, 1995, as amended.
Washington
00 XXXX/XXXX/XXXX/XXXX xxxxxxxxxxx (xxxx) site at West Tiger
Mountain, Issaquah, Washington leased pursuant to Permit with
Weyerhaeuser Company, dated January 1, 1988, as amended.
00 XXXX/XXXX/XXXX xxxxxxxxxxx (xxxxxxx) site at West Tiger Mountain,
Issaquah, Washington used pursuant to Master Antenna Owners
Agreement, dated July 26, 1988, as amended.
00 XXXX/XXXX xxxxxxx xx Xxxxxxxxxxxx Xxxx Xxxx, 0000 Xxxxx Xxx,
Xxxxxxx, Xxxxxxxxxx pursuant to Lease with Benaroya Capital
Corporation, dated August 29, 1984, as amended.
- 8 -
161
41 KBSG studio at Metropolitan Park East, 0000 Xxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxxxx leased pursuant to Lease with Benaroya
Capital Company, LLC, dated August 7, 1998, as amended.
42 KRQT studio site at Advocate Building, 00 Xxxxxxx Xxxx, Xxxxxx
Xxxx, Xxxxxxxxxx leased pursuant to Lease with Xxxx and Xxxxxxx
Xxxxxxx, dated September 1, 1993.
43 KIRO/KNWX studios at 0000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxx Xxxxxx,
Xxxxxxxxxx leased pursuant to Lease with Xxxxxxx Family Limited
Partnership, dated May 26, 1995, as amended.
00 XXXX (FM) auxiliary transmitter site at 0000 X.X. Xxxx
Xxxx, Xxxx Xxxxxxx, Xxxxxx Xxxxxx, Xxxxxxxxxx pursuant
to Lease with Pacific Lutheran University, dated
February 28, 1991.
00 XXXX translator site at 000 Xxxxx Xxxx, X.X., Xxxxxxx,
Xxxxxxxx Xxxxxx, Xxxxxxxxxx leased pursuant to Lease
with Sisters of Providence in Washington d/b/a St. Xxxxx
Hospital, dated July 1, 1993.
46 KBSG(AM) transmitter (daytime) (land) site at 0000 Xxxx Xxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxx leased pursuant to Ground Lease with
Garre Family Trust, dated November 2, 994.
47 KBSG(AM) transmitter (nighttime) (land) site at 0000 Xxxxx
Xxxxxxx Xxxx, Xxxxxx, Xxxxxxxxxx leased pursuant to Ground Lease
with Xxxxxx Xxxxx & Xxxxxx Xxxxxxxxx, dated June 19, 1989.
48 KBSG(FM) transmitter site at Indian Hill, Tacoma, Xxxxxx County,
Washington leased pursuant to Lease with Western
Tele-Communications, Inc., dated April 8, 1987.
49 KBSG RPU site at Bremerton, Kitsap County, Washington leased
pursuant to Lease with Xxxxx Television Company, dated October
26, 1995.
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162
50 KNDD transmitter (standby license to use road) site at Cougar
Mountain, Issaquah, King County, Washington access pursuant to
License with Ratelco Properties Corp., dated August 1, 1996.
51 KNDD transmitter (access road) site at Cougar Mountain, Issaquah,
Washington access pursuant to Grant of Easement for Access and
Power Lines with U.S. West Communications, Inc., dated August 28,
1998.
52 KISW transmitter site at Cougar Mountain, Issaquah, Washington
leased pursuant to Lease with Ratelco Properties Corporation,
dated October 1, 1995.
00 XXXX translator site at 0000 Xxxx Xxxxxx, X.X., Xxxxxxx,
Xxxxxxxxxx leased pursuant to Lease with Xxx X. Xxxxxxxxx, dated
July 8, 1996.
00 XXXX translator site at 0000 Xxxxxxxxx X.X. Xxxxxxx,
Xxxxxxxxxx leased pursuant to Lease with Xxxx Xxxx,
dated May 30, 1997.
55 KRQT transmitter (land) site at Xxxxxxxxx Mountain, Cowlitz
County, Washington leased pursuant to Ground Lease with
Mid-Valley Resources, Inc., dated May 1, 1993.
56 KRQT transmitter site at 0000 Xx. Xxxxxxx Xxxx, Xxxxx,
Xxxxxxxxxx leased pursuant to Lease with Northwest Tower
Systems, dated December 7, 1993.
- 10 -
163
EXHIBIT J
TO
LOAN AGREEMENT
AMONG
ENTERCOM COMMUNICATIONS CORP.,
KEY CORPORATE CAPITAL INC., AS ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS
SYNDICATION AGENT,
AND
THE FINANCIAL INSTITUTIONS WHICH ARE A PARTY THERETO
Environmental Compliance
Loan Agreement Section 5.25
1. All matters disclosed in Environmental audits and reports supplied to
Administrative Agent, including small amounts of asbestos at several sites
recently acquired by the Borrower.
2. Borrower was the Lessee of a transmitter site on Three
Sisters Mountain, Xxxxxx County, Washington, where two
underground diesel oil storage tanks were located. As part
of Borrower's vacation of this site in 1993 and sale of its
tower and building to Motorola, Borrower removed these tanks.
In the process of the removal and certification of these
tanks minor soil contamination from overfill spillage over
the years was discovered. This contamination was remedied
and all necessary governmental certifications of the site
were obtained prior to the turnover to Motorola.
3. During the period 1986 through approximately 1990 the Borrower conducted a
program to remove all PCB's from the Borrower's transmission equipment.
This process was completed using licensed transporters and incineration
facilities. Certificates of destruction for all removed material were
obtained. No spills were involved.
4. Borrower maintains an underground storage tank at its West
Tiger Mountain transmitter site near Issaquah, Washington.
This tank holds diesel fuel for the emergency generator, is a
164
double-walled tank and is in full compliance with all laws and regulations
relating to underground tanks.
5. The KIRO-AM transmitter site located in King County, Washington contains
an underground storage tank. The tank belongs to the Federal Emergency
Management Agency (FEMA), which is responsible for the tank. The tank
stores diesel fuel for the FEMA emergency generator made available to
KIRO-AM.
6. The Army Corps. of Engineers recently removed, on behalf of FEMA, an
underground storage tank located at the KFXX transmitter site in Oregon
City, Oregon. The tank belonged to FEMA, who was responsible for the tank.
The tank stored diesel fuel for the FEMA emergency generator made
available to KFXX. Soil testing at the site of removal did not indicate
any contamination.
7. Bonneville International Corporation, prior owner of KMBZ removed a 300
gallon underground diesel fuel storage tank located at the KMBZ studio and
transmitter site in Westwood, Kansas and replaced it with a new
double-walled tank complying with all laws and regulations relating to
underground tanks. No soil contamination was observed during this process.
8. The Borrower received a notice from the Kansas City office of the United
States Environmental Protection Agency ("EPA") regarding liability for 61
pounds of PCB containing materials disposed of by the Borrower in the
early 1980's, originating at a Station in Minnesota which Borrower sold in
1995, at a licensed incinerator disposal facility in Kansas City. The site
is the subject of an EPA cleanup and cost recovery operation. EPA has
verbally informed the Borrower that it will likely qualify for de minimis
status, in which case, the Borrower's liability should be less that
$10,000. The Borrower has also been verbally informed that the total
cleanup cost for this site is estimated to be between $12,000,000 to
$15,000,000.
9. Several years ago, a leaking underground storage tank ("LUST") was
removed from the WDAF transmitter site at 8105
- 2 -
000
Xxxxxxx Xxxx, Xxxxxxx Xxxxxxx, Xxxxxx. The contaminated soil surrounding
the LUST was also removed. However, the Kansas Department of Environmental
Protection has not issued a closure certification for the site and may
require further soil remediation. The prior owner of the site, Citicasters
Co. ("Citicasters"), is pursuing closure of the site with the State of
Kansas and American Radio Systems Corporation ("ARS") remains liable to
pay any remediation costs imposed upon Borrower in connection therewith.
10. Asbestos containing materials ("ACM") which had been identified inside the
transmitter building at the WDAF transmitter site at 0000 Xxxxxxx Xxxx,
Xxxxxxx Xxxxxxx, Xxxxxx have been removed by a licensed remediation firm.
ARS, pursuant to its contractual obligation, has reimbursed Borrower for
the full cost of such remediation.
11. A LUST also exists at a secondary WDAF tower site at 0000 Xxxxxx, Xxxxxx
Xxxx, Xxxxxxxx. WDAF's presence at the site is de minimis (two RPU's are
located on the tower and no WDAF owned equipment is present in any
buildings at the site) and ARS remains liable for the costs of any
remediation which might be imposed upon Borrower in connection therewith.
12. An underground storage tank and a leaking aboveground storage tank were
removed, in the mid 1990's, from the WBBF transmitter site located at 0000
Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx. Some soil contamination was
noted and removed at the time the tanks were removed. The New York
Department of Environmental Conservation ("NYDEC") did not require
remediation. The Borrower has been verbally advised by Heritage Media
Corporation, prior owner of WBBF, that the site has now been removed by
NYDEC from a list of potential contaminated sites, however, no documents
confirming that assertion have been received by Borrower.
13. Various environmental conditions at the WEEI transmitter site at 0000
Xxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxxxx have been identified in Phase I
Environmental Site Assessment Report delivered to Borrower in connection
with the
- 3 -
166
Boston I Transaction ("WEEI Report"). The WEEI Report recommends:
(a) sampling and analysis of on-site well water for contaminants
associated with an adjacent on-site septic system xxxxx field;
(b) cleanup of lubricating oil stain on concrete pad beneath
emergency generator located in transmitter building; (c) further
analysis of tower paint, and soil beneath tower, for lead
content, and, if necessary, remediation of same; (d) sampling and
analysis of suspected asbestos containing materials in thermal
pipe wrap in boiler room of transmitter building, and, if
necessary, remediation of same; and (e) sampling and analysis of
soil around Boston Edison substation transformer for PCBs, and if
necessary, remediation of same (unless Boston Edison informs
environmental consultant that such transformer never contained
PCBs).
14. Various environmental conditions at the WRKO transmitter
site at 0 Xxxxx Xxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx
have been identified in Phase I Environmental Site
Assessment Reports delivered to Borrower in connection
with the Boston I Transaction ("WRKO Reports"). The
WRKO Reports recommend: (a) further analysis of tower
paint for lead content, and, if necessary, remediation
of same; (b) further analysis of suspected asbestos
containing materials in thermal pipe wrap inside
transmitter building, and, if necessary, remediation of
same; and (c) further analysis of subsurface soil and
groundwater due to down gradient position of transmitter
site and close proximity to several hazardous waste and
CERCLIS list sites in area.
15. Various environmental conditions at the WWTM transmitter
site at 000 Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx
have been identified in Phase I Environmental Site
Assessment Reports delivered to Borrower in connection
with the Boston II Transaction ("WWTM Reports"). The
WWTM Reports recommend: (a) further analysis of tower
paint for lead content, and, if necessary, remediation
of same; and (b) further analysis of suspected asbestos
containing materials in floor tile and mastic inside
transmitter building, and, if necessary, remediation of
same.
- 4 -
167
EXHIBIT L
TO
LOAN AGREEMENT
AMONG
ENTERCOM COMMUNICATIONS CORP.,
KEY CORPORATE CAPITAL INC., AS ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS
SYNDICATION AGENT,
AND
THE FINANCIAL INSTITUTIONS WHICH ARE A PARTY THERETO
Existing Interests in Partnerships and Joint Ventures
Loan Agreement Section 8.10
The following Partnerships, Joint Ventures and other agreements are permitted
under this Loan Agreement:
1. All Partnerships and Joint Venture type agreements disclosed elsewhere in
this Loan Agreement and the Exhibits hereto.
2. Any Partnership or Joint Venture Agreements for the operation of a
multiplexed or common antenna facility similar to those disclosed on
Exhibit G hereto.
3. Local Marketing Agreements, Time Brokerage Agreements and similar
agreements for the operation of any Station to the extent permitted
pursuant to Section 8.14(b), including without limitation the Time
Brokerage Agreements with CBS Radio, Inc. relating to the operation of the
Stations to be acquired by Borrower in the Boston I Transaction and Boston
II Transaction, and relating to the Stations to be sold by Borrower in the
Tampa Transaction.
4. Joint Sales Agreements and similar agreements with other broadcasters for
the sale of broadcast advertising time, including without limitation the
Joint Sales Agreement with Classic Radio, Inc., dated May 20, 1997,
relating to KING(FM), Seattle, Washington.
168
EXHIBIT N
TO
LOAN AGREEMENT
AMONG
ENTERCOM COMMUNICATIONS CORP.,
KEY CORPORATE CAPITAL INC., AS ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS
SYNDICATION AGENT,
AND
THE FINANCIAL INSTITUTIONS WHICH ARE A PARTY THERETO
Material Labor Disputes
Loan Agreement Section 5.24
The following labor matters are disclosed pursuant to Section 5.24 of the Loan
Agreement:
1. Xxxxx Xxxxx filed a complaint of gender-based discrimination in the United
States District Court for the Western District of Pennsylvania on January
14, 1997. The Borrower has answered the Complaint, denying the
allegations, discovery has concluded, and Borrower's Motion for Summary
Judgment has been filed. The Borrower does not anticipate an outcome from
this claim that would have a material adverse effect on the Borrower.
2. Cassidy Haus filed a complaint of gender-based discrimination with the
Equal Employment Opportunity Commission ("EEOC") on January 25, 1995. The
EEOC dismissed her complaint and provided Xx. Xxxx with notice of her
right to xxx, but she has no yet exercised such right. The Borrower does
not anticipate an outcome from this claim that would have a material
adverse effect on the Borrower.
3. Xxxx Xxxxxx filed a complaint of race-based discrimination with the EEOC
on April 1, 1998. The EEOC dismissed the complaint on August 6, 1998.
169
4. Xxxx Xxxxxx filed a complaint alleging gender and age discrimination in
the Superior Court of Washington for King County on July 23, 1998. The
case was removed to the United States District Court for the Western
District of Washington at Seattle and Borrower has filed an answer with
that Court denying the substantive allegations asserted. Discovery is
ongoing. The Borrower does not anticipate an outcome from this claim that
would have a material adverse effect on the Borrower.
5. Xxxxxx Xxxxxx filed a complaint alleging gender discrimination in the
Superior Court of California for Sacramento County on August 19, 1998. The
case was removed to the United States District Court for the Eastern
District of California on September 16, 1998. The Borrower intends to file
an answer with the District Court denying the substantive allegations
asserted. The Borrower does not anticipate an outcome from this claim that
would have a material adverse effect on the Borrower.
6. Borrower has been negotiating for sometime with AFTRA regarding the terms
of a collective bargaining agreement for the programming employees at
KIRO(AM/FM) and KNWX(AM), Seattle, Washington. AFTRA has begun a publicity
campaign to try to force the Borrower to change its position on certain
issues. Although talk of a strike has circulated, no formal strike vote
has been taken.
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170
ACKNOWLEDGMENT AND AGREEMENT OF STOCKHOLDERS
Each of the undersigned hereby certifies that it is a stockholder of
Entercom Communications Corp., a Pennsylvania corporation (the "Borrower"), and
consents to the execution and delivery by the Borrower of the foregoing First
Amendment to Loan Agreement and the Amended Notes described therein and
acknowledges and agrees that the Borrower Pledge Agreement and each other
Collateral Document (as those terms are defined in the Loan Agreement, and as
such documents may be amended from time to time) to which it is a party, and all
of its respective obligations thereunder, remain in full force and effect, and
that the security interests granted pursuant to the Borrower Pledge Agreement
secure all of the Obligations, as increased pursuant to the First Amendment to
Loan Agreement.
STOCKHOLDERS:
XXXXXX X. FIELD
XXXXX X. FIELD
S. XXXXXX XXXXXX TRUSTEE, U/D/T
DATED OCTOBER 9, 1992 FBO XXXXX X. FIELD
XXXXX X. FIELD
XXXXX X. FIELD & XXXXX X. FIELD, TRUSTEES
U/I 12/23/76 FOR XXXXX X. FIELD
S. XXXXXX XXXXXX AND XXXXX X. FIELD,
TRUSTEES U/D/T OF XXXXXX X. FIELD
DTD 9/30/92 FBO XXXXX X. FIELD
XXXXX X. FIELD
XXXXX X. FIELD & XXXXX X. FIELD,
TRUSTEES U/I DATED 12/23/76 FOR XXXXX X. FIELD
S. XXXXXX XXXXXX AND XXXXX X. FIELD,
TRUSTEES U/D/T OF XXXXXX X. FIELD DTD
9/30/92 FBO XXXXX X. FIELD
XXXXXXX XXXX
XXXXXXXX X. XXXXXX
XXX XXXXXX XXXX
XXXXXX X. XXXXXX, XX., JT, WROS
XXXX X. XXXXXX, XX, WROS
XXXXX X. XXXXXXXX
XXXXXX X. XXXXX
XXXXX X. XXXXXX
XXXXX X. FIELD AND S. XXXXXX XXXXXX, TRUSTEES U/D/T OF XXXXXX X.
FIELD DATED APRIL 24, 1998, F/B/O THE ISSUE OF XXXXX X. FIELD
171
XXXXX X. FIELD AND S. XXXXXX XXXXXX, TRUSTEES U/D/T OF XXXXXX X.
FIELD DATED APRIL 24, 1998, F/B/O THE ISSUE OF XXXXX X. FIELD
XXXXXX X. FIELD, TRUSTEE U/D/T OF XXXXXX X. XXXXX DATED JULY 21,
1998, F/B/O XXXXXXX XXXXXXX
XXXX XXXXXX XXXX AND XXXXXXXX XXXX XXXXXX TRUSTEES U/D/T OF
XXXXXXX XXXX DATED JULY 14, 1998, FBO THE ISSUE OF XXXXXXX XXXX
BY:__________________________________
Xxxx X. Xxxxxxxx,
By Power of Attorney from each of such Stockholders
172
ACKNOWLEDGMENT AND AGREEMENT OF SUBSIDIARIES
Each of the undersigned hereby certifies that it is a Subsidiary of
Entercom Communications Corp. (the "Borrower") and hereby consents to the
execution and delivery by the Borrower of the foregoing First Amendment to Loan
Agreement and the Amended Notes described therein and acknowledges and agrees
that the Subsidiary Guaranty, the Subsidiary Security Agreement and each other
Collateral Document (as those terms are defined in the Loan Agreement, as such
documents may be amended from time to time) to which it is a party, and all of
its respective obligations thereunder, remain in full force and effect, that the
security interests granted pursuant to the Subsidiary Security Agreement secure
all of the Obligations, as increased pursuant to the First Amendment to Loan
Agreement, and that all such Obligations shall be Guaranteed Obligations for all
purposes of the Subsidiary Guaranty.
ECI LICENSE COMPANY, L.P.
By:___________________________
Name:_________________________
Title:________________________
ECI LICENSE COMPANY, LP
By:___________________________
Name:_________________________
Title:________________________
ENTERCOM ROCHESTER, INC.
By:___________________________
Name:_________________________
Title:________________________
ENTERCOM BOSTON, INC.
173
By:___________________________
Name:_________________________
Title:________________________
ENTERCOM BOSTON, LLC
By:___________________________
Name:_________________________
Title:________________________
ENTERCOM BOSTON LICENSE, LLC
By:___________________________
Name:_________________________
Title:________________________
ENTERCOM PORTLAND, LLC
By:___________________________
Name:_________________________
Title:________________________
ENTERCOM PORTLAND LICENSE, LLC
By:___________________________
Name:_________________________
Title:________________________
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174
ACKNOWLEDGMENT AND AGREEMENT OF PARTNERS
Each of the undersigned hereby certifies that it is a partner of ECI
License Company, L.P., a Pennsylvania limited partnership (the "License
Partnership"), and consents to the execution and delivery by the Borrower of the
foregoing First Amendment to Loan Agreement and the Amended Notes described
therein and acknowledges and agrees that the Subsidiary Pledge Agreement and
each other Collateral Document (as those terms are defined in the Loan
Agreement, as such documents may be amended from time to time) to which it is a
party, and all of its respective obligations thereunder, remain in full force
and effect, and that the security interests granted pursuant to the Subsidiary
Pledge Agreement secure all of the Obligations, as increased pursuant to the
First Amendment to Loan Agreement.
ECI INVESTORS CORPORATION
By:___________________________
Name:_________________________
Title:________________________
ENTERCOM COMMUNICATIONS CORP.
By:___________________________
Name:_________________________
Title:________________________
175
FIRST AMENDMENT TO LOAN AGREEMENT
This FIRST AMENDMENT TO LOAN AGREEMENT is made and entered into as
of October 8, 1998, by and among ENTERCOM COMMUNICATIONS CORP., a Pennsylvania
corporation formerly known as "Entertainment Communications, Inc." (the
"Borrower"), the FINANCIAL INSTITUTIONS listed on the signature pages hereof
(the "Banks"), KEY CORPORATE CAPITAL INC., as Administrative Agent and
Documentation Agent (the "Administrative Agent"), and BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION, as Syndication Agent.
RECITALS
A. The Borrower, the Agents and the Banks entered into a Loan
Agreement dated as of February 13, 1998 (the "Original Agreement"), pursuant to
which the Banks agreed to make available to the Borrower loans of up to
$300,000,000 on a reducing revolving credit basis. The Original Agreement, as
amended hereby, may be referred to hereinafter as the "Loan Agreement."
Capitalized terms used herein and not otherwise defined shall have the meanings
assigned to them in the Loan Agreement.
B. The Borrower desires to increase the amount of the Commitment
to $350,000,000 pursuant to Section 2.15 of the Original Agreement, and add
additional Banks. In addition, the Borrower has requested that if it consummates
an initial public offering, (i) it be permitted to make a distribution to its
existing shareholders in the amount of approximately $95,000,000, (ii) it not be
required to make a mandatory prepayment of any portion of the proceeds of such
offering, and (iii) certain other changes be made to the Original Agreement.
Subject to the terms and conditions of this Amendment, the Agents and the Banks
have agreed to such requests.
AGREEMENTS
176
In consideration of the foregoing Recitals and of the covenants
and representations contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Borrower, the Agents and the Banks agree as follows:
1. Amendments. Subject to the satisfaction of the conditions set
forth in Section 2 of this Amendment, the Original Agreement shall be amended as
follows:
(a) The definition of the term "Excess Cash Flow" in Section
1.1 shall be amended by adding the phrase "(excluding deferred income taxes)"
after the words "income taxes" in clause (e) thereof.
(b) The definition of the term "Fixed Charge Coverage Ratio"
in Section 1.1 shall be amended (i) by adding the phrase "(excluding deferred
income taxes)" after the words "income taxes" in clause (c) thereof and (ii) by
deleting the current text of clause (d) thereof and replacing it with the
following: "(d) any Capital Distributions (including, without limitation,
Distributions to Pay Tax Liabilities, but excluding the Capital Distribution
made pursuant to Section 8.9(a)(v)) made by the Borrower in such four quarter
period".
(c) The definition of the term "Leverage Ratio" in Section
1.1 shall be amended in its entirety to read as follows:
"Leverage Ratio", as of any date, means the ratio of
Total Debt as of such date to Operating Cash Flow for the four
quarter period then ended or most recently ended; provided,
however, that in calculating the Leverage Ratio, Total Debt
shall be reduced by an amount equal to the QI Proceeds.
(d) The definition of the term "Operating Cash
Flow" in Section 1.1 shall be amended in its entirety to read as follows:
"Operating Cash Flow" means, during any period, the
consolidated Net Earnings of the Borrower for such period
(excluding, to the extent included in Net Earnings, (i) the
effect of any
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177
exchange of advertising time for non-cash consideration, such
as merchandise or services, (ii) any other non-cash income or
expense (including the cumulative effect of a change in
accounting principles and extraordinary items), and (iii) any
gains or losses net of taxes from sales, exchanges and other
dispositions of property not in the ordinary course of
business, including non-recurring charges relating to such
exchanges or dispositions), minus any non- operating income
(other than interest income and investment income), plus the
sum of (a) depreciation on or obsolescence of fixed or capital
assets and amortization of intangibles and leasehold
improvements for such period, plus (b) Interest Expense
incurred in such period plus interest incurred on the
Indebtedness under the Subordinated Purchase Agreement, plus
(c) federal, state and local income taxes incurred in such
period to the extent deducted in calculating Net Earnings in
such period (other than any such taxes resulting from any
gains from sales and exchanges and other distributions not in
the ordinary course of business), plus (d) the costs relating
to discontinued operations, all on a consolidated basis and
computed on the accrual method. For purposes of calculating
Operating Cash Flow in any period (other than for purposes of
calculating Excess Cash Flow):
(A) any acquisition of any Station, and any sale or
other disposition of any Station, which occurs during such
period shall be deemed to have occurred on the first day of
such period;
(B) Operating Cash Flow shall be increased by the
difference, if positive, of $802,000 minus the product of
$66,833 times the number of months in the period from March 1,
1998, through the end of the period for which Operating Cash
Flow is being calculated;
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178
(C) Operating Cash Flow shall be increased by the
difference, if positive, of $323,000 minus the product of
$26,917 times the number of months in the period from May 1,
1998, through the end of the period for which Operating Cash
Flow is being calculated;
(D) Operating Cash Flow for any period that includes
May 31, 1998, shall be increased by an amount equal to
$550,000;
(E) Operating Cash Flow shall be increased by the
difference, if positive, of $250,000 minus the product of
$20,833 times the number of months in the period from the date
of closing of the acquisition by the Borrower or any of its
Subsidiaries of radio stations WAAF(FM), WWTM(AM) and WEGQ(FM)
from CBS Radio, Inc., CBS Radio License, Inc. and ARS
Acquisition II, Inc. (collectively, the "Boston II Sellers")
pursuant to the Asset Purchase Agreement, dated as of August
13, 1998, among the Boston II Sellers and the Borrower,
through the end of the period for which Operating Cash Flow is
being calculated;
(F) Due to sports rights losses attributable to the
radio stations to be acquired pursuant to the Boston I
Purchase Agreement, Operating Cash Flow for any period which
includes any of the twelve full months prior to the
consummation of the transactions contemplated by the Boston I
Purchase Agreement shall be increased by an amount per month
for each such month in such period which amount per month
shall be set forth in a statement presented to the
Administrative Agent at the closing of such acquisition, which
statement shall be certified by the Borrower's chief financial
officer and acceptable to the Administrative Agent; and
(G) Operating Cash Flow shall be calculated as if
the License Partnership were a wholly owned Subsidiary of the
Borrower.
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179
(e) The definition of the term "Ratable Share" in Section 1.1
shall be amended in its entirety to read as follows:
"Ratable Share" means, with respect to any Bank, its pro
rata share of the Commitment, the Letters of Credit or the
Loans, as such pro rata share may be modified by assignment
pursuant to Section 12.7. As of the date of the First
Amendment, the Ratable Shares of the Banks shall be as listed
on Schedule 1.1 attached to the First Amendment.
(f) Section 1.1 shall be amended by adding thereto the
following new definitions in the proper alphabetical order:
"Boston I Purchase Agreement" means the Asset Purchase
Agreement, dated as of August 13, 1998, among the Borrower,
CBS Radio, Inc. and CBS Radio License, Inc., pursuant to which
the Borrower or one of its Subsidiaries will acquire radio
stations WEEI(AM) and WRKO(AM).
"First Amendment" means the First Amendment to Loan
Agreement dated as of October 8, 1998, among the Borrower, the
Agents and the Banks.
"QI Proceeds" means, as of any date of determination, an
amount equal to the difference of (a) the amount, if any, that
the Borrower on such date has on deposit with a Qualified
Intermediary (as that term is defined in Section
2.6(b)(iii)(B)) from the proceeds of a disposition of a
Station permitted pursuant to Section 8.10, minus (b) the
amount of tax liability that would have resulted, based on the
Borrower's good faith estimate reasonably satisfactory to the
Administrative Agent, had such disposition not been structured
as a Like-Kind Exchange (as that term is defined in Section
2.6(b)(iii)(B)).
"Qualified IPO" means an underwritten public offering of
the Borrower's common stock that (a)
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is led by a nationally recognized underwriter, (b) is pursuant
to a registration statement filed in accordance with the
Securities Act of 1933, as amended, (c) occurs on or before
March 31, 1999, and (d) yields gross aggregate proceeds to the
Borrower of at least $50,000,000.
"Tampa Purchase Agreement" means the Asset Purchase
Agreement dated as of August 13, 1998, among the Borrower, CBS
Radio, Inc. and CBS Radio License, Inc. relating to the sale
by the Borrower of Stations WYUU(FM) and WLLD(FM).
(g) Subsection 2.1(a) shall be amended in its entirety to read
as follows:
2.1 The Revolving Commitment and the Revolving Loans.
(a) Subject to the terms and conditions hereof, during
the period from the Closing Date up to but not including the
Termination Date, the Banks severally, but not jointly, shall
make loans to the Borrower in such amounts as the Borrower may
from time to time request but not exceeding in aggregate
principal amount at any one time outstanding $350,000,000 (as
such amount may be reduced pursuant to Section 2.1(d), 2.6 or
any other provision of this Agreement, from time to time, the
"Commitment"); provided, however, that in no event shall the
aggregate principal amount of such loans plus the aggregate
stated amount of the Letters of Credit exceed the Commitment.
All amounts borrowed by the Borrower pursuant to this Section
2.1(a) and all amounts drawn under any Letter of Credit and
not repaid may be referred to hereinafter collectively as the
"Loans." Each Loan requested by the Borrower shall be funded
by the Banks in accordance with their Ratable Shares of the
requested Loan. A Bank shall not be obligated hereunder to
make any additional Loan if immediately after making such
Loan, the aggregate principal balance of all Loans made by
such Bank
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plus such Bank's Ratable Share of any outstanding Letters of
Credit would exceed such Bank's Ratable Share of the
Commitment. The Loans may be comprised of Base Rate Loans or
LIBOR Loans, as provided in Section 2.3.
(h) Sections 2.6(b)(iii)(A) and (B) shall be amended by adding
the phrase ", so long as the Borrower has not ceased to be treated as an 'S
corporation' under the Code," after the phrase "or its stockholders" in the 8th,
29th and 35th lines of Section 2.6(b)(iii)(A) and in the last sentence of
Section 2.6(b)(iii)(B).
(i) Section 2.6(b)(v) shall be amended by adding the language
"(other than pursuant to a Qualified IPO")" in the fourth line thereof after the
word "interests."
(j) Section 2.15 is hereby amended by deleting the text
thereof and replacing it with the language: "[Intentionally Omitted]."
(k) Section 3.1(b) shall be amended by adding the following
language at the end of the first sentence thereof:
; provided, however, that the Applicable Margin shall also be
determined on the date of closing of the transactions
contemplated by the Tampa Purchase Agreement on the basis of
information certified by the Borrower and acceptable to the
Administrative Agent and presented to it on such date.
(l) Section 7.12 shall be amended by adding the following
language at the end thereof:
; provided, however, that in calculating Total Debt for
purposes of this Section 7.12, (a) the principal amount of
Loans made to the Borrower on the date of the consummation of
the transactions contemplated by the Boston I Purchase
Agreement and used by the Borrower to pay the purchase price
thereunder shall be excluded for a period of time ending on
the first to occur of the date that is
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thirty days after such consummation and the date on which
funds are deposited with a Qualified Intermediary (as that
term is defined in Section 2.6(b)(iii)(B)) from the proceeds
of the sale contemplated by the Tampa Purchase Agreement (the
"Tampa Contribution Date") and (b) the total amount
contributed to such Qualified Intermediary from the proceeds
of the sale contemplated by the Tampa Purchase Agreement shall
be excluded for so long as such proceeds are held by such
Qualified Intermediary.
(m) Section 8.9(a) shall be amended by adding a new subsection
(v) at the end thereof, which shall read as follows:
(v) if the Borrower consummates a Qualified IPO, the
Borrower may make a Capital Distribution to its stockholders
no later than six months after such consummation in an
aggregate amount which does not exceed the lesser of
$95,000,000 and the net proceeds to the Borrower from such
Qualified IPO, so long as: (A) the Borrower shall have
demonstrated to the satisfaction of the Administrative Agent
that the Borrower will be in compliance with all of the
covenants contained herein after giving effect to such
distribution; (B) no Possible Default or Event of Default
exists at the time of making such distribution or would exist
after giving effect thereto; and (C) the Borrower shall have
delivered to the Administrative Agent a certificate of a
financial officer of the Borrower using the most recently
available quarterly financial statements in form and substance
satisfactory to the Administrative Agent which shall contain
calculations demonstrating on a pro forma basis the Borrower's
compliance with the financial covenants set forth in this
Section 8 after giving effect to such distribution.
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(n) The first paragraph of Section 8.10(c) and Sections
8.10(c)(i) and (ii) shall be amended in their entirety to read as follows:
(c) As of the date of this Agreement, all of the assets
of each Station, other than the FCC Licenses, are owned by the
Borrower, and all of the FCC Licenses of the Stations are
owned by the License Partnership. The Borrower desires (y) to
create new Subsidiaries and contribute all of its operating
assets relating to the Stations to such Subsidiaries and (z)
either to acquire all of the outstanding capital stock and
other equity interests of ECI Investors Corporation, so that
the License Partnership becomes a wholly owned subsidiary of
the Borrower or to create new Subsidiaries and contribute all
of the FCC Licenses held by the License Partnership to such
Subsidiaries. The Borrower shall have the right to so
reorganize subject to the satisfaction of all of the following
conditions:
(i) each new Subsidiary shall be wholly owned by the
Borrower;
(ii) the License Partnership shall be wholly owned
by the Borrower or all of the FCC Licenses of the Stations
shall be transferred to one or more of such newly created
wholly owned Subsidiaries which shall have no other assets or
liabilities, and upon such transfer, the License Partnership
shall be dissolved and liquidated;
(o) Section 8.13(b) shall be amended (i) by adding the phrase
"plus the stated amount of all outstanding Letters of Credit, minus the amount,
if any, of QI Proceeds" after the word "Loans" in the second line thereof and
(ii) by adding the following language at the end thereof:
"provided, however, that for the period of time which is the
lesser of thirty days and the period of time between the
closing of the transactions contemplated by the Boston I
Purchase Agreement
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184
and the closing of the transactions contemplated by the Tampa
Purchase Agreement, the first ratio in Column C above (for the
period from Closing through March 31, 1999) shall be 7.0:1.0
rather than 6.5:1.0."
(p) Section 8.15 shall be amended in its entirety to read as
follows:
8.15 "Fiscal Year" The Borrower shall not, and shall not
permit any Subsidiary to, change its fiscal year; provided,
however, that the Borrower may change its fiscal year and the
fiscal year of its Subsidiaries to the calendar year.
(q) The second sentence of Section 8.24 shall be amended by
adding the phrase "if such issuance occurs prior to the termination of the
Borrower Pledge Agreement pursuant to Section 8.10(c)" at the end thereof.
(r) Section 9.11 shall be amended (i) by deleting the phrase
"voting capital stock" in the fifth line thereof and replacing it with the
phrase "voting power of the capital stock" and (ii) by deleting the period at
the end of that Section and adding a new clause at the end thereof which shall
read as follows:
; or the Borrower shall cease to own, directly or indirectly,
all of the issued and outstanding capital stock, partnership
interests or other equity interests of each License
Subsidiary.
(s) Section 12.4 shall be amended by deleting each reference
to "Entertainment Communications, Inc." and replacing it with a reference to
"Entercom Communications Corp."
(t) Clause (c) of Section 12.12 shall be amended in its
entirety to read as follows:
(c) change the Commitment or the Ratable Share of any Bank
(other than any change in Commitment or Ratable Share
resulting from the sale of a participation in or assignment of
any Bank's
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185
interest in the Commitment and Loans in accordance with
subsection 12.7,
(u) Schedule 1.1 and Xxxxxxxx X, X, X, X, X, X, X, L and N to
the Original Agreement shall be deleted and replaced with Schedule I attached
hereto.
2. Conditions to Effectiveness. The amendments set forth in
Section 1 shall be effective on such date on which all of the following
conditions are satisfied:
(a) The Borrower shall have executed and delivered to each
Bank an Amended and Restated Reducing Revolving Credit Note (collectively, the
"Amended Notes") in the form attached hereto as Exhibit A.
(b) The Borrower shall have paid all fees of the Agents and
the Banks and payable pursuant to the terms of the Loan Agreement and the Fee
Letters.
(c) The Borrower shall have delivered to the Administrative
Agent a certified copy of resolutions of the Board of Directors of the Borrower
evidencing approval of the execution, delivery and performance of this
Amendment, the Amended Notes and the other documents and instruments required
pursuant hereto.
(d) The stockholders of the Borrower, the License Partnership
and the partners of the License Partnership shall have executed the
Acknowledgments and Agreements attached hereto.
(e) The Borrower shall have delivered to the Administrative
Agent such other documents, instruments and opinions as the Administrative Agent
or any Bank may reasonably request.
3. Representations, Warranties and Events of Default.
(a) Except as amended hereby, the terms, provisions,
conditions and agreements of the Original Agreement are hereby ratified and
confirmed and shall remain in full force and effect. Each and every
representation and warranty of the Borrower set forth in the Original Agreement
(other than those
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186
which by their terms are limited to a specific date) is hereby confirmed and
ratified in all material respects, and such representations and warranties as so
confirmed and ratified shall be deemed to have been made and undertaken as of
the date of this Amendment as well as at the time they were made and undertaken,
except to the extent such representations and warranties have been affected by
events contemplated by or permitted pursuant to the Loan Agreement or as
previously disclosed to the Banks in writing.
(b) The Borrower represents and warrants that:
i) No Event of Default or Possible Default now exists or
will exist immediately following the execution hereof or after giving effect to
the transactions contemplated hereby.
ii) All necessary corporate or stockholder actions on the
part of the Borrower and the stockholders of the Borrower to authorize the
execution, delivery and performance of this Amendment, the Amended Notes and all
other documents or instruments required pursuant hereto or thereto have been
taken; this Amendment, the Amended Notes and each such other document or
instrument have been duly and validly executed and delivered and are legally
valid and binding upon the Borrower and enforceable in accordance with their
respective terms, except to the extent that the enforceability thereof may be
limited by bankruptcy, insolvency or like laws or by general equitable
principles.
iii) The execution, delivery and performance of this
Amendment, the Amended Notes and all other documents and instruments required
pursuant hereto or thereto, and all actions and transactions contemplated hereby
and thereby will not (A) violate, be in conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under (I) any
provision of the Articles of Incorporation, By-Laws, partnership agreement,
certificate of limited partnership, operating agreement, certificate of
formation or any other governing document of the Borrower or any Subsidiary,
(II) any arbitration award or any order of any court or of any other
governmental agency or authority, (III) any license, permit or authorization
granted to the Borrower or any Subsidiary or under which the Borrower or any
Subsidiary operates, or (IV) any
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187
applicable law, rule, order or regulation, indenture, agreement or other
instrument to which the Borrower or any Subsidiary is a party or by which the
Borrower or any Subsidiary or any of their respective properties is bound and
which has not been waived or consented to, or (B) result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever, except
as expressly permitted in the Loan Agreement, upon any of the properties of the
Borrower or any Subsidiary.
iv) No consent, approval or authorization of, or filing,
registration or qualification with, any governmental authority (including,
without limitation, the FCC and any other Licensing Authority) is required to be
obtained by the Borrower or any Subsidiary in connection with the execution,
delivery or performance of this Amendment, the Amended Notes or any document or
instrument required in connection herewith or therewith which has not already
been obtained or completed.
v) The Borrower is taking such actions and devoting such
resources that, in the good faith exercise of its business judgment, it believes
to be reasonably necessary to permit the proper functioning, in and following
the year 2000, of the computer systems of the Borrower and its Subsidiaries and
equipment containing embedded microchips (including systems and equipment
supplied by others or with which the systems of the Borrower or its Subsidiaries
interface). The Borrower believes that the cost to the Borrower and its
Subsidiaries of such actions and of the reasonably foreseeable consequences of
year 2000 to the Borrower and its Subsidiaries (including, without limitation,
reprogramming errors and the failure of others' systems or equipment) will not
result in an Event of Default or a Material Adverse Effect. The Borrower
believes that, subject to completion of the actions referred to above, the
computer and management information systems of the Borrower and its Subsidiaries
are and, with ordinary course upgrading and maintenance, will continue to be,
sufficient to permit the Borrower and its Subsidiaries to conduct their business
without Material Adverse Effect.
4. Affirmation of the Borrower. The Borrower has executed this
Amendment to consent to the amendments to the Original Agreement made pursuant
hereto and to acknowledge that the security interests and liens granted by the
Borrower to the
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188
Administrative Agent, for the benefit of the Banks, pursuant to the Borrower
Security Agreement, the Subsidiary Pledge Agreement and the other Collateral
Documents to which the Borrower is a party remain in full force and effect and
shall continue to secure all Obligations, as increased pursuant hereto.
5. Fees and Expenses. As required under the Original Agreement,
the Borrower will reimburse the Administrative Agent upon demand for all
out-of-pocket costs, charges and expenses of the Administrative Agent (including
reasonable fees and disbursements of special counsel to the Administrative
Agent) in connection with the preparation, negotiation, execution and delivery
of this Amendment and the other agreements or documents relating hereto or
required hereby.
6. Counterparts. This Amendment may be executed in as many
counterparts as may be convenient and shall become binding when the Borrower,
the Agents and each Bank have executed at least one counterpart.
7. Governing Law. This Amendment shall be a contract made under
and governed by the laws of the State of Ohio, without regard to the conflicts
of law provisions thereof.
8. Binding Effect. This Amendment shall be binding upon and shall
inure to the benefit of the Borrower, the Agents, the Banks and their respective
successors and assigns.
9. Reference to Original Agreement. Except as amended hereby, the
Original Agreement shall remain in full force and effect and is hereby ratified
and confirmed in all respects. On and after the effectiveness of the amendments
to the Original Agreement accomplished hereby, each reference in the Original
Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like
import, and each reference to the Original Agreement or the original notes
evidencing the Revolving Loans issued pursuant thereto in any Note or other
Collateral Document, or other agreement, document or instrument executed and
delivered pursuant to the Original Agreement, shall be deemed a reference to the
Original Agreement, as amended hereby, or the Amended Notes, as the case may be.
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189
10. No Other Modifications; Same Indebtedness. The modifications
effected by this Amendment and by the other documents and instruments
contemplated hereby shall not be deemed to provide for or effect a repayment and
re-advance of any of the Loans now outstanding, it being the intention of the
Borrower, the Agents and the Banks that the Loans outstanding under the Original
Agreement, as amended by this Amendment, be and are the same Indebtedness as
that owing under the Original Agreement immediately prior to the effectiveness
hereof.
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190
IN WITNESS WHEREOF, the parties have executed this First Amendment
to Loan Agreement as of the date first above written.
BORROWER:
ENTERCOM COMMUNICATIONS CORP.
By:___________________________
Name:_________________________
Title:________________________
BANKS:
KEY CORPORATE CAPITAL INC.
By:___________________________
Name: Xxxxxxx X. St. Pierre
Title: Vice President
BANK OF AMERICA, NATIONAL TRUST AND SAVINGS ASSOCIATION
By:___________________________
Name:_________________________
Title:________________________
CIBC INC.
By:___________________________
Name:_________________________
Title:________________________
FIRST UNION NATIONAL BANK
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191
By:___________________________
Name:_________________________
Title:________________________
FLEET BANK, N.A.
By:___________________________
Name:_________________________
Title:________________________
U.S. BANK, N.A.
By:___________________________
Name:_________________________
Title:________________________
BANK OF MONTREAL
By:___________________________
Name:_________________________
Title:________________________
COMPAGNIE FINANCIERE DE CIC
ET DE L'UNION EUROPEENNE
By:___________________________
Name:_________________________
Title:________________________
By:___________________________
Name:_________________________
Title:________________________
FIRST HAWAIIAN BANK
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192
By:___________________________
Name:_________________________
Title:________________________
SUNTRUST BANK, CENTRAL FLORIDA, N.A.
By:___________________________
Name:_________________________
Title:________________________
UNION BANK OF CALIFORNIA, N.A.
By:___________________________
Name:_________________________
Title:________________________
PROVIDENT BANK OF MARYLAND
By:___________________________
Name:_________________________
Title:________________________
PNC BANK, NATIONAL ASSOCIATION
By:___________________________
Name:_________________________
Title:________________________
SUMMIT BANK
By:___________________________
Name:_________________________
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193
Title:________________________
ISSUING BANK:
KEY CORPORATE CAPITAL INC.
By:___________________________
Name: Xxxxxxx X. St. Pierre
Title: Vice President
ADMINISTRATIVE AGENT:
KEY CORPORATE CAPITAL INC.
By:___________________________
Name: Xxxxxxx X. St. Pierre
Title: Vice President
SYNDICATION AGENT:
BANK OF AMERICA, NATIONAL TRUST AND SAVINGS ASSOCIATION
By:___________________________
Name: ________________________
Title: _______________________
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194
SCHEDULE I TO FIRST AMENDMENT TO LOAN AGREEMENT
SCHEDULE 1.1
Ratable Shares
Ratable Share of Commitment
Bank and Loans:
KEY CORPORATE CAPITAL INC. 12.00000000%
BANK OF AMERICA, NATIONAL
TRUST AND SAVINGS ASSOCIATION 12.85714286%
CIBC INC. 9.64285714%
FIRST UNION NATIONAL BANK 6.00000000%
FLEET BANK, N.A. 9.00000000%
BANK OF MONTREAL 9.00000000%
COMPAGNIE FINANCIERE DE CIC
ET DE L'UNION EUROPEENNE 5.00000000%
SUNTRUST BANK,
CENTRAL FLORIDA, N.A. 5.00000000%
UNION BANK OF CALIFORNIA, N.A. 5.00000000%
U.S. BANK, N.A. 7.14285714%
FIRST HAWAIIAN BANK 2.85714286%
PROVIDENT BANK OF MARYLAND 2.00000000%
PNC BANK, NATIONAL ASSOCIATION 5.00000000%
SUMMIT BANK 2.85714286%
Total: 100.000%
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