EXHIBIT 10.24
[Conformed Copy]
00000-000-00
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CREDIT AGREEMENT
dated as of
August 29, 1997
between
ARGYLE TELEVISION, INC.
(to be renamed HEARST-ARGYLE TELEVISION, INC.
following the Merger Transactions referred to herein)
The SUBSIDIARY GUARANTORS Party Hereto
The LENDERS Party Hereto
THE CHASE MANHATTAN BANK,
as Administrative Agent
and
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK,
as Documentation Agent
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$1,000,000,000
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms................................................. 1
SECTION 1.02. Classification of Loans and Borrowings........................ 28
SECTION 1.03. Terms Generally............................................... 28
SECTION 1.04. Accounting Terms; GAAP........................................ 29
ARTICLE II
THE CREDITS
SECTION 2.01. The Commitments............................................... 30
SECTION 2.02. Loans and Borrowings.......................................... 31
SECTION 2.03. Requests for Borrowings....................................... 32
SECTION 2.04. Swingline Loans............................................... 33
SECTION 2.05. Letters of Credit............................................. 35
SECTION 2.06. Funding of Borrowings......................................... 39
SECTION 2.07. Interest Elections............................................ 40
SECTION 2.08. Termination and Reduction of the Commitments.................. 41
SECTION 2.09. Repayment of Loans; Evidence of Debt.......................... 43
SECTION 2.10. Prepayment of Loans........................................... 45
SECTION 2.11. Fees.......................................................... 49
SECTION 2.12. Interest...................................................... 51
SECTION 2.13. Alternate Rate of Interest.................................... 51
SECTION 2.14. Increased Costs............................................... 52
SECTION 2.15. Break Funding Payments........................................ 53
SECTION 2.16. Taxes......................................................... 54
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-offs... 55
SECTION 2.18. Mitigation Obligations; Replacement of Lenders................ 57
ARTICLE III
GUARANTEE
SECTION 3.01. The Guarantee................................................. 58
SECTION 3.02. Obligations Unconditional..................................... 59
SECTION 3.03. Reinstatement................................................. 60
SECTION 3.04. Subrogation................................................... 60
SECTION 3.05. Remedies...................................................... 60
SECTION 3.06. Instrument for the Payment of Money........................... 60
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SECTION 3.07. Continuing Guarantee 60
SECTION 3.08. Rights of Contribution 61
SECTION 3.09. General Limitation on Guarantee Obligations.. 61
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Organization; Powers.......................................... 62
SECTION 4.02. Authorization; Enforceability................................. 62
SECTION 4.03. Governmental Approvals; No Conflicts.......................... 62
SECTION 4.04. Financial Condition; No Material Adverse Change............... 63
SECTION 4.05. Properties.................................................... 64
SECTION 4.06. Litigation and Environmental Matters.......................... 64
SECTION 4.07. Compliance with Laws and Agreements........................... 65
SECTION 4.08. Investment and Holding Company Status......................... 65
SECTION 4.09. Taxes......................................................... 65
SECTION 4.10. ERISA......................................................... 65
SECTION 4.11. Disclosure.................................................... 66
SECTION 4.12. Use of Credit................................................. 66
SECTION 4.13. Material Agreements and Liens With Respect to Indebtedness.... 66
SECTION 4.14. Capitalization................................................ 67
SECTION 4.15. Subsidiaries and Investments.................................. 67
SECTION 4.16. Station Licenses.............................................. 68
SECTION 4.17. Merger Agreement.............................................. 69
ARTICLE V
CONDITIONS
SECTION 5.01. Effective Date................................................ 69
SECTION 5.02. Each Credit Event............................................. 71
ARTICLE VI
AFFIRMATIVE COVENANTS
SECTION 6.01. Financial Statements and Other Information.................... 72
SECTION 6.02. Notices of Material Events.................................... 74
SECTION 6.03. Existence; Conduct of Business................................ 75
SECTION 6.04. Payment of Obligations........................................ 75
SECTION 6.05. Maintenance of Properties; Insurance.......................... 75
SECTION 6.06. Books and Records; Inspection Rights.......................... 75
SECTION 6.07. Compliance with Laws.......................................... 76
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SECTION 6.08. Use of Proceeds and Letters of Credit......................... 76
SECTION 6.09. Certain Obligations Respecting Subsidiaries................... 76
ARTICLE VII
NEGATIVE COVENANTS
SECTION 7.01. Indebtedness.................................................. 78
SECTION 7.02. Liens......................................................... 79
SECTION 7.03. Fundamental Changes........................................... 80
SECTION 7.04. Lines of Business............................................. 83
SECTION 7.05. Investments................................................... 83
SECTION 7.06. Restricted Payments........................................... 85
SECTION 7.07. Transactions with Affiliates.................................. 85
SECTION 7.08. Restrictive Agreements........................................ 86
SECTION 7.09. Modifications of Certain Documents............................ 87
SECTION 7.10. Certain Financial Covenants................................... 87
ARTICLE VIII
EVENTS OF DEFAULT................................... 88
ARTICLE IX
THE ADMINISTRATIVE AGENT ............................... 91
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Notices...................................................... 93
SECTION 10.02. Waivers; Amendments.......................................... 94
SECTION 10.03. Expenses; Indemnity; Damage Waiver........................... 95
SECTION 10.04. Successors and Assigns....................................... 96
SECTION 10.05. Survival..................................................... 99
SECTION 10.06. Counterparts; Integration; Effectiveness..................... 99
SECTION 10.07. Severability................................................. 100
SECTION 10.08. Right of Setoff.............................................. 100
SECTION 10.09. Governing Law; Jurisdiction; Consent to Service of Process... 100
SECTION 10.10. WAIVER OF JURY TRIAL......................................... 101
SECTION 10.11. Headings..................................................... 101
SECTION 10.12. Treatment of Certain Information; Confidentiality............ 101
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SCHEDULE I - Commitments
SCHEDULE II - Material Agreements and Liens with Respect to Indebtedness
SCHEDULE III - Litigation and Environmental Matters
SCHEDULE IV - Subsidiaries and Investments
SCHEDULE V - Station Licenses
SCHEDULE VI - Certain Equity Rights
EXHIBIT A - Form of Assignment and Acceptance
EXHIBIT B - Form of Guarantee Assumption Agreement
EXHIBIT C - Form of Opinion of Counsel to the Obligors
EXHIBIT D - Form of Opinion of Special Communications Counsel
EXHIBIT E - Form of Opinion of Special New York Counsel to The
Chase Manhattan Bank
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CREDIT AGREEMENT dated as of August 29, 1997, between ARGYLE
TELEVISION, INC. (to be renamed HEARST-ARGYLE TELEVISION, INC., following the
Merger Transactions referred to herein), the SUBSIDIARY GUARANTORS party hereto,
the LENDERS party hereto and THE CHASE MANHATTAN BANK, as Administrative Agent.
Pursuant to an Amended and Restated Agreement and Plan of Merger dated
as of March 26, 1997 by and among The Hearst Corporation, HAT Merger Sub, Inc.,
HAT Contribution Sub, Inc., and Argyle Television, Inc., the parties thereto
have agreed to effect the Merger Transactions (as hereinafter defined)
providing, inter alia, for the transfer to Argyle Television, Inc. of the Hearst
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Stations (as hereinafter defined), and related obligations and liabilities. In
that connection, Argyle Television, Inc. has requested that the Lenders extend
credit to it (by means of loans and letters of credit) in an aggregate amount up
to $1,000,000,000 (which may, in the circumstances herein provided, be increased
to $1,250,000,000) to finance the cash portion of the Merger Transactions, to
pay for fees and expenses relating thereto, to finance acquisitions, to
refinance existing indebtedness of Argyle Television, Inc. (including certain
indebtedness assumed in connection with the Merger Transactions), to repurchase
outstanding shares of its capital stock and for the general corporate purposes
of Argyle Television, Inc. and its subsidiaries. The Lenders are willing to
extend such credit upon the terms and conditions hereof and, accordingly, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms. As used in this Agreement, the
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following terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
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whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
"Acquisition" shall have the meaning assigned to such term in Section
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7.03(c)(iv).
"Acquisition Related Compensation Expenses" means, with respect to any
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acquisition, (i) severance payments made to terminated employees in connection
with such acquisition, (ii) stay bonuses paid in connection with such
acquisition and (iii) costs and fees related to hiring and relocating new
employees in connection with such acquisition, including payments to employee
search firms.
"Additional Permitted Indebtedness" means Indebtedness of the Borrower
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incurred or assumed in accordance with the provisions of Section 7.01(g).
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"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing
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for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means The Chase Manhattan Bank, in its capacity
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as administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative Questionnaire
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in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another Person
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that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"Alternate Base Rate" means, for any day, a rate per annum equal to
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the greatest of (a) the Prime Rate in effect on such day, (b) the Base CD Rate
in effect on such day plus 1% and (c) the Federal Funds Effective Rate in effect
on such day plus 1/2 of 1%. Any change in the Alternate Base Rate due to a
change in the Prime Rate, the Base CD Rate or the Federal Funds Effective Rate
shall be effective from and including the effective date of such change in the
Prime Rate, the Base CD Rate or the Federal Funds Effective Rate, respectively.
"Applicable Margin" means, with respect to any ABR Loan (including any
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Swingline Loan) or Eurodollar Loan, or with respect to the commitment fees
payable hereunder, as the case may be, the applicable rate per annum set forth
below under the caption "ABR Loans", "Eurodollar Loans" or "Commitment Fee", as
the case may be, based upon the Leverage Ratio as at the last day of the fiscal
quarter most recently ended as to which the Borrower has either delivered
financial statements pursuant to Section 6.01, or (in the case of the fourth
fiscal quarter in any fiscal year) as to which the Borrower has otherwise
delivered financial statements as at the end of and for such fiscal quarter (or,
prior to the delivery of the first of such statements after the Effective Date,
upon the Leverage Ratio set forth in the certificate of a Financial Officer
delivered pursuant to Section 5.01(i)):
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Leverage ABR Eurodollar Commitment
Ratio: Loans Loans Fee
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Greater than 5.00x 0.00% 0.625% 0.1875%
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Greater than 4.50x
but less than or
equal to 5.00x 0.00% 0.500% 0.1500%
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Greater than 4.00x
but less than or
equal to 4.50x 0.00% 0.400% 0.1250%
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Less than or equal
to 4.00x 0.00% 0.325% 0.1250%
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Each change in the "Applicable Margin" based upon any change in the
Leverage Ratio shall become effective for purposes of the accrual of interest
and commitment fees hereunder (including in respect of all then-outstanding
Loans and Commitments) on the date three Business Days after the delivery to the
Administrative Agent of the financial statements of the Borrower and its
Consolidated Subsidiaries for the most recently ended fiscal quarter pursuant to
Section 6.01, and shall remain effective for such purpose until three Business
Days after the next delivery of such financial statements to the Administrative
Agent hereunder, provided that, notwithstanding the foregoing, the Applicable
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Margin shall be the highest rates provided for in the above schedule for any
period during which either (i) an Event of Default shall have occurred and be
continuing or (ii) the Borrower shall be in default of its obligation to deliver
financial statements for any fiscal quarter by the times specified in Section
6.01 (but upon the cure or waiver of any such Event of Default or default, this
proviso shall no longer be applicable until another such Event of Default or
default shall occur).
"Applicable Percentage" means, with respect to any Lender, the
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percentage of the total Revolving Commitments represented by such Lender's
Revolving Commitment. If the Revolving Commitments have terminated or expired,
the Applicable Percentages shall be determined based upon the Revolving
Commitments most recently in effect, giving effect to any assignments.
"Argyle Stations" means, collectively, the Cincinnati Station, the
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Providence Station, and television broadcast stations KITV-TV in Honolulu,
Hawaii (and its various satellite stations), WAPT-TV in Jackson, Mississippi,
KHBS-TV in Ft. Xxxxx, Arkansas, KHOG-TV in Fayetteville, Arkansas, and KOCO-TV
in Oklahoma City, Oklahoma.
"Assessment Rate" means, for any day, the annual assessment rate in
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effect on such day that is payable by a member of the Bank Insurance Fund
classified as
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"well-capitalized" and within supervisory subgroup "B" (or a comparable
successor risk classification) within the meaning of 12 C.F.R. Part 327 (or any
successor provision) to the Federal Deposit Insurance Corporation for insurance
by such Corporation of time deposits made in dollars at the offices of such
member in the United States; provided that if, as a result of any change in any
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law, rule or regulation, it is no longer possible to determine the Assessment
Rate as aforesaid, then the Assessment Rate shall be such annual rate as shall
be determined by the Administrative Agent to be representative of the cost of
such insurance to the Lenders.
"Assignment and Acceptance" means an assignment and acceptance entered
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into by a Lender and an assignee (with the consent of the party or parties whose
consent is required by Section 10.04), and accepted by the Administrative Agent,
in the form of Exhibit A or any other form approved by the Administrative Agent.
"Available Revolving Credit" means, at any date, the aggregate unused
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amount of the Revolving Credit Commitments hereunder (after giving effect to any
pending Borrowings or prepayments as to which notice shall have been given
hereunder) to the extent that (on a pro forma basis) such Revolving Credit
Commitments could have been utilized through Borrowings hereunder for general
working capital purposes during the period of four fiscal quarters most recently
ended for which financial statements are available hereunder.
"Base CD Rate" means the sum of (a) the Three-Month Secondary CD Rate
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multiplied by the Statutory Reserve Rate plus (b) the Assessment Rate.
"Basic Documents" means, collectively, the Loan Documents, the Merger
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Agreement, the Private Placement Documents and Tax Sharing Agreement.
"Basket Investments" has the meaning assigned to such term in Section
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7.05(h).
"Board" means the Board of Governors of the Federal Reserve System of
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the United States of America.
"Borrower" means Argyle Television, Inc. (to be renamed Hearst-Argyle
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Television, Inc. following the Merger Transactions), a Delaware corporation.
"Borrowing" means (a) Loans of the same Class and Type, made,
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converted or continued on the same date and, in the case of Eurodollar Loans, as
to which a single Interest Period is in effect or (b) a Swingline Loan.
"Borrowing Request" means a request by the Borrower for a Borrowing in
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accordance with Section 2.03.
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"Bridge Debt" means Indebtedness of Cash Sub in an aggregate principal
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amount equal to $200,000,000 incurred immediately prior to the Merger
Transactions, which Indebtedness is to be assumed by the Borrower in connection
with the Merger Transactions.
"Broadcast Cash Flow" means, for any period, the sum (determined on a
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consolidated basis without duplication in accordance with GAAP) for the Borrower
and its Consolidated Subsidiaries, of EBITDA for such period, calculated before
Corporate Overhead for such period.
"Business Day" means any day that is not a Saturday, Sunday or other
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day on which commercial banks in New York City are authorized or required by law
to remain closed; provided that, when used in connection with a Eurodollar Loan,
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the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"Capital Expenditures" means, for any period, expenditures (including
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the aggregate amount of Capital Lease Obligations incurred during such period)
made by the Borrower or any of its Consolidated Subsidiaries to acquire or
construct fixed assets, plant and equipment (including renewals, improvements
and replacements, but excluding repairs) during such period computed in
accordance with GAAP; provided that any such expenditures made in connection
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with any Acquisition shall not constitute Capital Expenditures.
"Capital Lease Obligations" of any Person means the obligations of
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such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Cash Sub" means HAT Contribution Sub, Inc., a Delaware corporation.
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"Casualty Event" means, with respect to any property of the Borrower
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or any of its Consolidated Subsidiaries, any casualty or other insured damage
to, or any taking under power of eminent domain or by condemnation or similar
proceeding of, such property for which the Borrower or any of its Consolidated
Subsidiaries receives insurance proceeds, or proceeds of a condemnation award or
other compensation.
"Change of Control" means that (a) an aggregate of at least 35% of the
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outstanding shares of capital stock of the Borrower shall cease to be owned
beneficially by (i) Hearst and (ii) all "Permitted Transferees" under and as
defined in the Certificate of Incorporation of the Borrower as in effect
immediately after the Merger Transactions and (b) Hearst and such "Permitted
Transferees", collectively, shall cease to be able to elect a majority of the
members of the Board of Directors of the Borrower (or such greater number
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of the members of such Board of Directors as shall be necessary, under the
Certificate of Incorporation and by-laws of the Borrower, to approve all actions
requiring approval of such Board of Directors assuming full attendance by all
members of such Board of Directors at a meeting thereof).
"Change in Law" means (a) the adoption of any law, rule or regulation
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after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender or the Issuing
Lender (or, for purposes of Section 2.14(b), by any lending office of such
Lender or by such Lender's or the Issuing Lender's holding company, if any) with
any request, guideline or directive (whether or not having the force of law) of
any Governmental Authority with which, if the same does not have the force of
law, such Lender believes in good faith that it would be disadvantageous not to
comply, in each case made or issued after the date of this Agreement.
"Cincinnati Station" means television broadcast station WLWT-TV,
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Cincinnati, Ohio.
"Class", when used in reference to any Loan or Borrowing, refers to
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whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans,
Incremental Facility Loans, Term Loans or Swingline Loans and, when used in
reference to any Commitment, refers to whether such Commitment is a Revolving
Commitment or Incremental Facility Commitment.
"Code" means the Internal Revenue Code of 1986, as amended from time
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to time.
"Commitment" means a Revolving Commitment or Incremental Facility
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Commitment, or any combination thereof (as the context requires).
"Consolidated Subsidiary" means any Subsidiary of the Borrower other
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than a Designated Subsidiary.
"Control" means the possession, directly or indirectly, of the power
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to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
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"Conversion Date" means the Quarterly Date falling on or nearest to
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December 31, 1999.
"Corporate Overhead" means, for any period, all amounts paid or
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incurred by the Borrower and its Consolidated Subsidiaries (determined on a
consolidated basis) during
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such period in respect of all items of general corporate overhead and
administrative expenses and the like including, without duplication, (x) all
amounts payable by the Borrower or any of its Consolidated Subsidiaries to any
of its Affiliates during such period in respect of items that would constitute
general corporate overhead or administrative expense of the Borrower if paid or
incurred by the Borrower and (y) all Management Fees.
"Dayton Station" means television broadcast station WDTN-TV in Dayton,
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Ohio.
"Debt Service" means, for any period, the sum, for the Borrower and
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its Consolidated Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP), of the following: (a) the amount, if any,
by which the aggregate principal amount of Incremental Facility Loans
outstanding hereunder at the beginning of such period shall exceed the aggregate
amount of the Incremental Facility Commitments scheduled to be in effect at the
end of such period after giving effect to any reductions of such Commitments
scheduled to occur during such period pursuant to Section 2.08 plus (b) all
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regularly scheduled payments or regularly scheduled mandatory prepayments of
principal of any other Indebtedness (including the Term Loans and the principal
component of any payments in respect of Capital Lease Obligations, but excluding
any prepayments pursuant to Section 2.10) made during such period plus (c) all
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Interest Expense for such period.
"Default" means any event or condition which constitutes an Event of
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Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Designated Subsidiary" means any Subsidiary designated as a
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"Designated Subsidiary" pursuant to Section 6.09(b).
"Disclosed Matters" means the actions, suits and proceedings and the
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environmental matters disclosed in Schedule III. The disclosure of information
in any schedule or exhibit to this Agreement shall not constitute an admission
by the Borrower that such information is material for any purpose, including
applicable securities laws.
"Disposition" means any sale, assignment, transfer or other
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disposition of any property (whether now owned or hereafter acquired) by the
Borrower or any of its Consolidated Subsidiaries to any other Person excluding
any sale, assignment, transfer or other disposition of (x) any property sold or
disposed of in the ordinary course of business and on ordinary business terms,
(y) any Investment permitted under Section 7.05(f) and (z) the Dayton Station
and the Providence Station. The term "Disposition" shall include the entering
into by the Borrower or any of its Consolidated Subsidiaries of any LMA
Arrangement that in economic effect is functionally equivalent to the sale of a
Station (without limiting the obligation of the Borrower and its Consolidated
Subsidiaries to first
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obtain the consent of the Required Lenders to such LMA Arrangement pursuant to
Section 10.02, if required hereunder).
"Disposition Investment" means, with respect to any Disposition, any
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promissory notes or other evidences of indebtedness or Investments received by
the Borrower or any of its Consolidated Subsidiaries in connection with such
Disposition.
"Dividend Payment" means dividends (in cash, property or obligations)
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on, or other payments or distributions on account of, or the setting apart of
money for a sinking or other analogous fund for, or the purchase, redemption,
retirement or other acquisition of, any shares of any class of stock of the
Borrower or of any warrants, options or other rights to acquire the same (or,
other than in respect of employee compensation arrangements entered into in the
ordinary course of business, to make any payments to any Person, such as
"phantom stock" payments, where the amount thereof is calculated with reference
to the fair market or equity value of the Borrower or any of its Subsidiaries),
but excluding (x) dividends payable solely in shares of common stock of the
Borrower or (y) the cash payment by the Borrower to its stockholders pursuant to
a "Cash Election" (as that term is defined in the Merger Agreement) so long as
the aggregate amount of all such cash payments shall not exceed $160,000,000 and
shall be paid on or prior to September 12, 1997.
"dollars" or "$" refers to lawful money of the United States of
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America.
"EBITDA" means, for any period, the sum, determined without
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duplication, for the Borrower and its Consolidated Subsidiaries, of (a) net
revenue (defined as gross operating revenue, including network compensation and
production revenues, plus rental income minus the sum of barter and trade
---- -----
revenue, agency and advertising commissions and sales representative fees) minus
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(b) operating expenses (determined as provided in the next sentence) minus (c)
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Film Cash Payments minus (d) Corporate Overhead. In calculating "EBITDA":
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(i) "operating expenses" shall be determined exclusive of barter
and trade expenses, depreciation and amortization (including amortization
in respect of Film Obligations and barter expenses), Interest Expense, any
non-cash charges (including non-cash pension expenses and any write-offs of
programming rights), Acquisition Related Compensation Expenses, LMA
Purchase Price Payments, income taxes accrued for the relevant period, and
any Capital Expenditures, and "net revenue" and "operating expenses" shall
both be determined exclusive of (x) any payments made or received under
Hedging Agreements, (y) extraordinary and non-recurring gains or losses,
and any gains or losses from the sale of assets and (z) any non-cash stock
option expense or non-cash stock option gain in respect of options for the
capital stock of the Borrower issued to any of its or its Subsidiaries'
officers, directors or employees;
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(ii) performance bonuses shall be treated as an "operating
expense" only in the period in which such bonuses are paid, whether or not
such bonuses are accrued during or in respect of such period;
(iii) for all purposes of this Agreement (other than for
purposes of EBITDA as used in the definition of Excess Cash Flow), any Film
Cash Payment to the extent consisting of an up-front payment made with
respect to a Film Obligation incurred during such period, shall not be
deducted in determining EBITDA for such period but shall instead (x) in the
event such contract has a term of twelve months or less, be amortized over
the term of such contract and (y) in the event such contract has a term of
more than twelve months, be amortized over the term of such contract (or,
if shorter, the pay period of such contract), and in the case of both (x)
and (y), only the portion of such Film Cash Payment so amortized during
such period shall be deducted in determining EBITDA for such period; and
(iv) if during any period for which EBITDA is being determined
the Borrower or any Consolidated Subsidiary shall have acquired any new
Station or Stations (including the Hearst Stations), then, for all purposes
of this Agreement (other than for purposes of the definition of Excess Cash
Flow, for which purpose actual EBITDA for the relevant period shall be
used), EBITDA shall be determined on a pro forma basis for such period as
if the relevant acquisition had been made or consummated on the first day
of such period.
"Effective Date" means the date on which the conditions specified in
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Section 5.01 are satisfied (or waived in accordance with Section 10.02).
"Environmental Laws" means all laws, rules, regulations, codes,
------------------
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.
"Environmental Liability" means any liability, contingent or otherwise
-----------------------
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Equity Issuance" means (a) any issuance or sale by the Borrower after
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the Effective Date of (i) any of its capital stock, (ii) any warrants or options
exercisable in respect
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of its capital stock (other than any warrants or options issued to directors,
officers or employees of the Borrower or any of its Consolidated Subsidiaries,
pursuant to employee benefit plans established in the ordinary course of
business and any capital stock of the Borrower issued upon the exercise of such
warrants or options) or (iii) any other security or instrument representing an
equity interest (or the right to obtain any equity interest) in the Borrower or
(b) the receipt by the Borrower whether directly (or indirectly through one or
more of its Consolidated Subsidiaries) after the Effective Date of any capital
contribution (whether or not evidenced by any equity security issued by the
Borrower).
"Equity Rights" means, with respect to any Person, any subscriptions,
-------------
options, warrants, commitments, preemptive rights or agreements of any kind
(including any stockholders' or voting trust agreements) for the issuance, sale,
registration or voting of, or securities convertible into, any additional shares
of capital stock of any class, or partnership or other ownership interests of
any type in, such Person.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
---------------
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in Section
-----------
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the existence
with respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or of a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
-11-
"Eurodollar", when used in reference to any Loan or Borrowing, refers
----------
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in Article
----------------
VIII.
"Excess Cash Flow" means, for any period, the sum, determined without
----------------
duplication, for the Borrower and its Consolidated Subsidiaries, of (a) EBITDA
for such period minus (b) Fixed Charges for such period plus (c) cash receipts
----- ----
during such period in respect of any extraordinary or non-recurring gains to the
extent not required pursuant to Section 2.10(b)(ii) to be applied to the
prepayment of the Loans (and/or to provide cover for Letter of Credit
Liabilities) and reductions of the Commitments (or minus cash payments during
-----
such period in respect of any extraordinary or non-recurring losses) minus (d)
-----
Acquisition Related Compensation Expenses for such period.
"Excluded Taxes" means, with respect to the Administrative Agent, any
--------------
Lender, the Issuing Lender or any other recipient of any payment to be made by
or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.18(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement or is attributable to such Foreign Lender's failure or
inability to comply with Section 2.16(e), except to the extent that such Foreign
Lender's assignor (if any) was entitled, at the time of assignment, to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.16(a).
"Existing Credit Agreement" means the Amended and Restated Credit
-------------------------
Agreement dated as of June 13, 1995 between the Borrower, each of the
subsidiaries of the Borrower named therein, the lenders named therein, The Chase
Manhattan Bank (successor to The Chase Manhattan Bank (National Association)) as
administrative agent for said lenders, and Bank of Montreal, Banque Paribas and
Union Bank as co-agents (as modified and supplemented and in effect on the
Effective Date).
"FCC" means the Federal Communications Commission or any governmental
---
authority substituted therefor.
"Federal Funds Effective Rate" means, for any day, the weighted
----------------------------
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds
-12-
brokers, as published on the next succeeding Business Day by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day that is a
Business Day, the average (rounded upwards, if necessary, to the next 1/100 of
1%) of the quotations for such day for such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by it.
"Film Cash Payments" means, for any period, the sum (determined on a
------------------
consolidated basis and without duplication in accordance with GAAP) of all
payments by the Borrower and its Consolidated Subsidiaries made or scheduled to
be made during such period in respect of Film Obligations.
"Film Obligations" means obligations in respect of the purchase, use,
----------------
license or acquisition of programs, programming materials, films and similar
assets used in connection with the business and operation of the Borrower and
its Consolidated Subsidiaries.
"Financial Officer" means the chief financial officer, principal
-----------------
accounting officer, treasurer or controller of the Borrower.
"Fixed Charges" means, for any period, the sum, for the Borrower and
-------------
its Consolidated Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP), of the following:
(a) the aggregate amount of Debt Service for such period, plus
----
(b) the aggregate amount of taxes (excluding deferred taxes) paid or
payable in respect of the income or profit of the Borrower and its
Subsidiaries for such period plus
----
(c) the aggregate amount of all Capital Expenditures made during such
period (such aggregate amount of Capital Expenditures to be deemed to be
equal to the lesser of (x) actual Capital Expenditures for such period and
(y) $15,000,000, provided that the amount of actual Capital Expenditures in
--------
excess of $15,000,000 in such period, shall not be excluded from the
calculation of "Fixed Charges" unless and to the extent that, at the time
of calculation, the Borrower has Available Revolving Credit), plus
----
(d) commitment fees and letter of credit fees paid during such period
pursuant to this Agreement plus
----
(e) Dividend Payments and Management Fees paid in cash during such
period.
In calculating "Fixed Charges" for any period, if any portion of such period
shall occur prior to an Acquisition of any Station, Fixed Charges shall be
calculated as if such Station had been acquired by the Borrower and its
Consolidated Subsidiaries at the beginning of such period.
-13-
"Fixed Charges Ratio" means, as at any date, the ratio of (a) EBITDA
-------------------
for the period of four consecutive fiscal quarters ending on or most recently
ended prior to such date to (b) Fixed Charges for such period.
"Foreign Lender" means any Lender that is organized under the laws of
--------------
a jurisdiction other than that in which the Borrower is located. For purposes
of this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"Fort Xxxxx Preferred Stock" means, collectively, shares of Series A
--------------------------
Preferred Stock of the Borrower (in an aggregate face amount up to but not
exceeding $12,500,000) and shares of Series B Preferred Stock of the Borrower
(in an aggregate face amount up to but not exceeding $12,500,000).
"GAAP" means generally accepted accounting principles in the United
----
States of America.
"Governmental Authority" means the government of the United States of
----------------------
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantee" shall mean a guarantee, an endorsement, a contingent
---------
agreement to purchase or to furnish funds for the payment or maintenance of, or
otherwise to be or become contingently liable under or with respect to, the
Indebtedness, other obligations, net worth, working capital or earnings of any
Person, or a guarantee of the payment of dividends or other distributions upon
the stock or equity interests of any Person, or an agreement to purchase, sell
or lease (as lessee or lessor) Property, products, materials, supplies or
services primarily for the purpose of enabling a debtor to make payment of such
debtor's obligations or an agreement to assure a creditor against loss, and
including causing a bank or other financial institution to issue a letter of
credit or other similar instrument for the benefit of another Person, but
excluding (i) endorsements for collection or deposit in the ordinary course of
business and (ii) typical and customary indemnification obligations, and
representations and warranties, made in connection with the purchase or sale of
property or the issuance of securities. The terms "Guarantee" and "Guaranteed"
--------- ----------
used as a verb shall have a correlative meaning.
"Guarantee Assumption Agreement" means a Guarantee Assumption
------------------------------
Agreement substantially in the form of Exhibit B by an entity that, pursuant to
Section 6.09(c) is required to become a "Subsidiary Guarantor" hereunder in
favor of the Administrative Agent.
-14-
"Hazardous Materials" means all explosive or radioactive substances or
-------------------
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"Hearst" means The Hearst Corporation, a Delaware corporation.
------
"Hearst Stations" means, collectively, the Dayton Station and
---------------
television broadcast stations KMBC-TV in Kansas City, Kansas, WBAL-TV in
Baltimore, Maryland, WCVB-TV in Boston, Massachusetts, WISN-TV in Milwaukee,
Wisconsin, and WTAE-TV in Pittsburgh, Pennsylvania.
"Hedging Agreement" means any interest rate protection agreement,
-----------------
foreign currency exchange agreement, commodity price protection agreement,
equity derivative or other interest or currency exchange rate or commodity price
hedging arrangement.
"Incremental Facility Availability Period" means the period from and
----------------------------------------
including the Effective Date to but excluding the Quarterly Date falling on or
nearest to December 31, 1998.
"Incremental Facility Commitment" of any Series means, with respect to
-------------------------------
each Lender, the commitment, if any, of such Lender to make Incremental Facility
Loans of such Series, as such commitment may be (a) reduced from time to time
pursuant to Section 2.08 and (b) reduced or increased from time to time pursuant
to assignments by or to such Lender pursuant to Section 10.04. The amount of
each Lender's Incremental Facility Commitment of any Series shall be determined
in accordance with the provisions of Section 2.01(c). The aggregate amount of
the Incremental Facility Commitments of all Series shall not exceed
$250,000,000.
"Incremental Facility Commitment Reduction Date" means, with respect
----------------------------------------------
to the Incremental Facility Loans, each Quarterly Date during the period
commencing March 31, 2001, through and including the Maturity Date.
"Incremental Facility Lenders" means, in respect of any Series of
----------------------------
Incremental Facility Loans, a Lender with an Incremental Facility Commitment of
such Series or, if the Incremental Facility Commitments of such Series have
terminated or expired, a Lender with outstanding Incremental Facility Loans of
such Series.
"Incremental Facility Loans" means the Loans provided for by Section
--------------------------
2.01(c), which may be ABR Loans and/or Eurodollar Loans.
-15-
"Indebtedness" shall mean, for any Person, the sum (determined on a
------------
consolidated basis without duplication in accordance with GAAP), of the
following: (a) obligations created, issued or incurred by such Person for
borrowed money (whether by loan, the issuance and sale of debt securities or the
sale of Property to another Person subject to an understanding or agreement,
contingent or otherwise, to repurchase such Property from such Person); (b)
obligations of such Person to pay the deferred purchase or acquisition price of
Property or services, other than trade accounts payable (other than for borrowed
money) arising, and accrued expenses incurred, in the ordinary course of
business so long as such trade accounts payable are payable within 90 days of
the date the respective goods are delivered or the respective services are
rendered; (c) Indebtedness of others secured by a Lien on the Property of such
Person, whether or not the respective indebtedness so secured has been assumed
by such Person; (d) obligations of such Person in respect of letters of credit
or similar instruments issued or accepted by banks and other financial
institutions for account of such Person; (e) Capital Lease Obligations of such
Person; and (f) Indebtedness of others Guaranteed by such Person; provided that,
--------
such term shall not in any event include (v) contingent consideration payable in
connection with an Acquisition where, as of the date of determination, the
contingency requiring payment of such consideration is unlikely to occur (except
that in any event any such contingent consideration required to be carried as a
liability on a balance sheet of the Borrower and its Subsidiaries, or required
to be disclosed in a footnote to such balance sheet, shall constitute
Indebtedness), (w) obligations under Hedging Agreements, (x) Film Obligations,
(y) obligations in respect of letters of credit or surety bonds issued in
connection with fiduciary or fidelity obligations of or with respect to such
Person in the ordinary course of business or (z) obligations in respect of
shares of Fort Xxxxx Preferred Stock.
The Indebtedness of any Person shall include the Indebtedness of any
other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person's ownership interest in or other relationship with such entity, except to
the extent the terms of such Indebtedness provide that such Person is not liable
therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
-----------------
"Information Memorandum" means the Confidential Information Memorandum
----------------------
dated June, 1997, prepared in connection with the syndication to the Lenders of
the Commitments under this Agreement.
"Interest Coverage Ratio" means, as at any date of determination
-----------------------
thereof, the ratio of (a) EBITDA for the period of four fiscal quarters ending
on or most recently ended prior to such date to (b) Interest Expense for such
period.
"Interest Election Request" means a request by the Borrower to convert
-------------------------
or continue a Borrowing in accordance with Section 2.07.
-16-
"Interest Expense" shall mean, for any period, the sum, for the
----------------
Borrower and its Consolidated Subsidiaries (determined on a consolidated basis
without duplication in accordance with GAAP), of the following: (a) all
interest in respect of Indebtedness (including the interest component of any
payments in respect of Capital Lease Obligations but excluding any capitalized
financing fees) accrued or capitalized during such period (whether or not
actually paid during such period) plus (b) the net amount payable (or minus the
---- -----
net amount receivable) under Hedging Agreements during such period (whether or
not actually paid or received during such period). Notwithstanding the
foregoing, if as at any date (a "calculation date") fewer than four complete
----------------
consecutive fiscal quarters have elapsed subsequent to the Effective Date,
Interest Expense shall be calculated only for the portion of such period
commencing on the Effective Date and ending on the calculation date, and then
shall be annualized by multiplying the amount of such Interest Expense by a
fraction, the numerator of which is 365 and the denominator of which is the
number of days during the period commencing on the day immediately following the
Effective Date through and including the calculation date.
Notwithstanding the foregoing provisions of this definition, "Interest
Expense" for any period shall not include any dividends paid in respect of the
Fort Xxxxx Preferred Stock during such period.
"Interest Payment Date" means (a) with respect to any ABR Loan, each
---------------------
Quarterly Date, (b) with respect to any Eurodollar Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part and, in
the case of a Eurodollar Borrowing with an Interest Period of more than three
months' duration, each day prior to the last day of such Interest Period that
occurs at intervals of three months' duration after the first day of such
Interest Period and (c) with respect to any Swingline Loan, the day that such
Loan is required to be repaid.
"Interest Period" means, with respect to any Eurodollar Borrowing, the
---------------
period commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, three or six months (or,
with the consent of each Lender, nine months) thereafter, as the Borrower may
elect; provided, that (i) if any Interest Period would end on a day other than a
--------
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day and (ii) any Interest Period that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest Period.
For purposes hereof, the date of a Borrowing initially shall be the date on
which such Borrowing is made and thereafter shall be the effective date of the
most recent conversion or continuation of such Borrowing.
-17-
"Investment" means, for any Person: (a) the acquisition (whether for
----------
cash, property, services or securities or otherwise) of capital stock, bonds,
notes, debentures, partnership or other ownership interests or other securities
of any other Person or any agreement to make any such acquisition (including any
"short sale" or any sale of any securities at a time when such securities are
not owned by the Person entering into such sale); (b) the making of any deposit
with, or advance, loan or other extension of credit to, any other Person
(including the purchase of property from another Person subject to an
understanding or agreement, contingent or otherwise, to resell such property to
such Person), but excluding any such advance, loan or extension of credit having
a term not exceeding 90 days arising in connection with the sale of programming
or advertising time by such Person in the ordinary course of business; (c) the
entering into of any Guarantee of, or other contingent obligation with respect
to, Indebtedness or other liability of any other Person and (without
duplication) any amount committed to be advanced, lent or extended to such
Person; or (d) the entering into of any Hedging Agreement.
"Issuing Lender" means The Chase Manhattan Bank, in its capacity as
--------------
the issuer of Letters of Credit hereunder, and its successors in such capacity
as provided in Section 2.05(j).
"LC Disbursement" means a payment made by the Issuing Lender pursuant
---------------
to a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate undrawn
-----------
amount of all outstanding Letters of Credit at such time plus (b) the aggregate
amount of all LC Disbursements that have not yet been reimbursed by or on behalf
of the Borrower at such time. The LC Exposure of any Lender at any time shall
be its Applicable Percentage of the total LC Exposure at such time.
"Lenders" means the Persons listed on Schedule I and any other Person
-------
that shall have become a party hereto pursuant to an Assignment and Acceptance,
other than any such Person that ceases to be a party hereto pursuant to an
Assignment and Acceptance. Unless the context otherwise requires, the term
"Lenders" includes each Swingline Lender.
"Letter of Credit" means any letter of credit issued pursuant to this
----------------
Agreement.
"Letter of Credit Documents" means, with respect to any Letter of
--------------------------
Credit, collectively, any application therefor and any other agreements,
instruments, guarantees or other documents (whether general in application or
applicable only to such Letter of Credit) governing or providing for (a) the
rights and obligations of the parties concerned or at risk with respect to such
Letter of Credit or (b) any collateral security for any of such obligations,
each as the same may be modified and supplemented and in effect from time to
time.
-18-
"Leverage Ratio" means, at any date, the ratio of (a) the sum, for the
--------------
Borrower and its Consolidated Subsidiaries (determined on a consolidated basis
without duplication in accordance with GAAP) of the aggregate amount of all
Indebtedness as at such date to (b) EBITDA for the period of four consecutive
fiscal quarters ending on or most recently ended prior at such date.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
---------
Interest Period, the rate appearing on Page 3750 of the Dow Xxxxx Markets
Service (or on any successor or substitute page of such Service, or any
successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to dollar deposits in the
London interbank market) at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period. In the event that
such rate is not available at such time for any reason, then the LIBO Rate with
respect to such Eurodollar Borrowing for such Interest Period shall be the rate
at which dollar deposits of $5,000,000 and for a maturity comparable to such
Interest Period are offered by the principal London office of the Administrative
Agent in immediately available funds in the London interbank market at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
----
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"LMA Arrangement" means, with respect to any Person that owns any
---------------
television broadcasting station, (i) any so-called "local marketing agreements"
or any other arrangements with any other television broadcasting station (other
than with the Borrower or another Consolidated Subsidiary with respect to one of
the Stations) whereby the parties agree to function cooperatively in terms of
programming, advertising, sales, management, consulting or similar services; or
(ii) any so-called "time brokerage agreements" or any other agreements or
arrangements under which any Station shall (A) sell broadcast time to any other
television broadcasting station (other than to any other Station) which programs
such broadcast time and sells its own commercial advertising announcements
during such broadcast time or (B) purchase broadcast time on any other
television broadcasting station (other than on any other Station) for the
purpose of programming such broadcast time and selling its commercial
advertisements during such time.
-19-
"LMA Purchase Price Payments" means any payment under an LMA
---------------------------
Arrangement that constitutes an Acquisition to the extent such payment
constitutes all or a portion of the purchase or acquisition price (whether or
not deferred) of the assets or the air time or both of the television station
subject to such LMA Arrangement.
"Loan Documents" means, collectively, this Agreement and the Letter of
--------------
Credit Documents.
"Loans" means the loans made by the Lenders to the Borrower pursuant
-----
to this Agreement.
"Management Fees" means, for any period, any amounts paid or incurred
---------------
by the Borrower or any of its Consolidated Subsidiaries to any of its Affiliates
(excluding to the Borrower and its Consolidated Subsidiaries) on account of
fees, salaries, administrative expenses and other compensation (including on
account of any regular, special or accrued bonuses), provided that "Management
--------
Fees" for any period shall not include any non-cash stock option expense (or be
reduced by any non-cash stock option gain) in respect of options for the capital
stock of the Borrower issued to any of its or its Subsidiaries' officers,
directors or employees.
"Margin Stock" means "margin stock" within the meaning of Regulations
------------
G, T, U and X.
"Material Adverse Effect" means a material adverse effect on (a) the
-----------------------
business, assets, operations, prospects or condition, financial or otherwise, of
the Borrower and its Consolidated Subsidiaries taken as a whole (excluding
adverse changes to prospects as a result of changes affecting the television
broadcasting industry generally), (b) the ability of any Obligor to perform any
of its obligations under this Agreement or any of the other Loan Documents to
which it is a party or (c) the rights of or benefits available to the Lenders
under this Agreement or any of the other Loan Documents.
"Material Indebtedness" means Indebtedness (other than the Loans and
---------------------
Letters of Credit), or obligations in respect of one or more Hedging Agreements,
of any one or more of the Borrower and its Consolidated Subsidiaries in an
aggregate principal amount exceeding $15,000,000. For purposes of determining
Material Indebtedness, the "principal amount" of the obligations of any Person
----------------
in respect of any Hedging Agreement at any time shall be the maximum aggregate
amount (giving effect to any netting agreements) that such Person would be
required to pay if such Hedging Agreement were terminated at such time.
"Maturity Date" means, the Quarterly Date falling on or nearest to
-------------
December 31, 2004.
-20-
"Merger Agreement" means the Amended and Restated Agreement and Plan
----------------
of Merger dated as of March 26, 1997 by and among Hearst, Merger Sub, Cash Sub
and the Borrower.
"Merger Sub" means HAT Merger Sub, Inc., a Delaware corporation.
----------
"Merger Transactions" means, collectively, the following transactions
-------------------
contemplated by the Merger Agreement, each of which is to take place
substantially simultaneously on the Effective Date in the following order:
(a) the restatement of the Certificate of Incorporation of the
Borrower in the form attached to the Merger Agreement as Exhibit A;
(b) the contribution by Cash Sub to the Borrower of $200,000,026.50
and the contribution by Hearst to the Borrower of the Hearst Stations and
"Hearst Broadcasting Productions" (as such term is defined in the Merger
Agreement);
(c) in consideration for the contributions described in the foregoing
clause (b), (x) the assumption by the Borrower of the Bridge Debt, the
Private Placement Debt and the obligations and liabilities of Hearst
relating to the Hearst Stations (including "Hearst Broadcasting
Productions" as such term is defined in the Merger Agreement), and the
assumption by the respective Subsidiaries of the Borrower to whom the
Hearst Stations (and "Hearst Broadcasting Productions") are being
transferred of such obligations and liabilities and (y) the issuance by the
Borrower to Hearst of 38,611,000 shares (subject to a working capital
adjustment) of the Borrower's Series B Common Stock and by the Borrower to
Cash Sub of one share of the Borrower's Series B Common Stock; and
(d) the merger of Merger Sub with and into the Borrower, with the
Borrower being the surviving corporation and with the outstanding shares of
capital stock of the constituent corporations to be converted, or canceled
in exchange for cash, in the manner and to the extent provided in Article
III of the Merger Agreement.
"Multiemployer Plan" means a multiemployer plan as defined in Section
------------------
4001(a)(3) of ERISA.
"Net Cash Proceeds" means:
-----------------
(a) in the case of any Casualty Event, the aggregate amount of cash
proceeds of insurance, condemnation awards and other compensation received
by the Borrower and its Consolidated Subsidiaries in respect of such
Casualty Event net of (i) reasonable expenses incurred by the Borrower and
its Consolidated Subsidiaries in connection therewith and (ii)
contractually required repayments of Indebtedness to the
-21-
extent secured by a Lien on such property and any income and transfer taxes
payable by the Borrower or any of its Consolidated Subsidiaries in respect
of such Casualty Event; and
(b) in the case of any Disposition, the aggregate amount of all cash
payments received by the Borrower and its Consolidated Subsidiaries
directly or indirectly in connection with such Disposition, whether at the
time of such Disposition or after such Disposition under deferred payment
arrangements or Investments entered into or received in connection with
such Disposition (including Disposition Investments); provided that
--------
(i) Net Cash Proceeds shall be net of (A) the amount of any
legal, title, transfer, accounting and recording tax expenses,
commissions and other fees and expenses payable by the Borrower and
its Consolidated Subsidiaries in connection with such Disposition and
(B) any Federal, state and local income or other taxes estimated to be
payable by the Borrower and its Consolidated Subsidiaries as a result
of such Disposition, but only to the extent that such estimated taxes
are in fact paid to the relevant Federal, state or local governmental
authority within fifteen months of the date of such Disposition; and
(ii) Net Cash Proceeds shall be net of any repayments by
the Borrower or any of its Consolidated Subsidiaries of Indebtedness
to the extent that (A) such Indebtedness is secured by a Lien on the
property that is the subject of such Disposition and (B) the
transferee of (or holder of a Lien on) such property requires that
such Indebtedness be repaid as a condition to the purchase of such
property.
"Obligor" means the Borrower and each Subsidiary Guarantor.
-------
"Other Taxes" means any and all present or future stamp or documentary
-----------
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made under any Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, any Loan Document.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
----
defined in ERISA and any successor entity performing similar functions.
"Permitted Encumbrances" means:
----------------------
(a) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 6.04;
-22-
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
and other like Liens imposed by law, arising in the ordinary course of
business and securing obligations that are not overdue by more than 30 days
or are being contested in compliance with Section 6.04;
(c) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other
social security laws or regulations;
(d) deposits to secure the performance of bids, tenders, trade
contracts, leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature, in each case in
the ordinary course of business;
(e) judgment liens in respect of judgments that do not constitute an
Event of Default under clause (l) of Article VIII; and
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do not
materially detract from the value of the affected property or interfere
with the ordinary conduct of business of the Borrower or any Subsidiary.
"Permitted Investments" means:
---------------------
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed
by the full faith and credit of the United States of America), in each case
maturing within one year from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days from the
date of acquisition thereof and having, at such date of acquisition, the
highest credit rating obtainable from Standard & Poor's Ratings Group or
from Xxxxx'x Investors Services, Inc.;
(c) investments in certificates of deposit, banker's acceptances and
time deposits maturing within 270 days from the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit accounts
issued or offered by, any domestic office of any commercial bank organized
under the laws of the United States of America or any State thereof (or
organized under the laws of any other jurisdiction if such bank has a long-
term senior debt rating of A or better) which has a combined capital and
surplus and undivided profits of not less than $500,000,000;
-23-
(d) fully collateralized repurchase agreements with a term of not
more than 30 days for securities described in clause (a) of this definition
and entered into with a financial institution satisfying the criteria
described in clause (c) of this definition; and
(e) interest in any money market mutual fund offered by The Chase
Manhattan Bank and/or Xxxxxx Guaranty Trust Company of New York registered
under the Investment Company Act of 1940, as amended, the portfolio of
which is limited primarily to obligations described in the foregoing
clauses (a), (b), (c) and (d) so long as such fund has total assets of at
least $1,000,000,000 and is rated AAAm-G or better or AAA or better by
Standard & Poor's Ratings Group or Xxxxx'x Investors Services, Inc.,
respectively.
"Person" means any natural person, corporation, limited liability
------
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
----
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Prime Rate" means the rate of interest per annum publicly announced
----------
from time to time by The Chase Manhattan Bank as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.
"Principal Payment Dates" means the Quarterly Dates falling on or
-----------------------
nearest to March 31, June 30, September 30 and December 31 of each year,
commencing with December 31, 2000, through and including December 31, 2004.
"Private Placement Debt" means the Indebtedness of Hearst in respect
----------------------
of its 7.87% Series A Senior Notes due 2001, its 8.01% Series B Senior Notes due
2002 and its 8.04% Series C Senior Notes due 2003, in an aggregate original
principal amount of $275,000,000, which Notes were issued by Hearst pursuant to
the several separate Note Purchase Agreements, each dated as of December 22,
1992, between Hearst and the "Purchasers" referred to therein, which
Indebtedness is to be assumed by the Borrower in connection with the Merger
Transactions.
"Private Placement Debt Documents" means, collectively, the Notes
--------------------------------
evidencing the Private Placement Debt and several separate Note Purchase
Agreements pursuant to which the Private Placement Debt was issued.
-24-
"Providence Station" means television broadcast station WNAC-TV in
------------------
Providence, Rhode Island.
"Purchase Price" means, with respect to any Acquisition under Section
--------------
7.03(c)(iv) hereof, an amount equal to the sum (without duplication) of (i) the
aggregate consideration, whether cash, property or securities (including any
Indebtedness incurred pursuant to Section 7.01(f) or 7.01(g)), paid or delivered
by the Borrower and its Consolidated Subsidiaries in connection with such
Acquisition plus (ii) the aggregate amount of liabilities of the acquired
----
business (net of current assets of the acquired business) that would be
reflected on a balance sheet (if such were to be prepared) of the Borrower and
its Consolidated Subsidiaries after giving effect to such Acquisition, provided
--------
that the term "Purchase Price" shall in any event exclude transaction fees and
expenses associated with the respective Acquisition).
"Quarterly Dates" means the last Business Day of March, June,
---------------
September and December in each year, the first of which shall be the first such
day after the date hereof.
"Register" has the meaning set forth in Section 10.04.
--------
"Registration Statement" means the registration statement on Form S-4
----------------------
(together with all amendments, schedules and exhibits thereto) filed by the
Borrower with the Securities and Exchange Commission with respect to Hearst-
Argyle Television Inc.'s Series A Common Stock to be issued in connection with
the Merger Transactions.
"Related Parties" means, with respect to any specified Person, such
---------------
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"Required Incremental Facility Lenders" means, with respect to any
-------------------------------------
Series of Incremental Facility Loans at any time, Lenders having Incremental
Facility Loans and unused Incremental Facility Commitments of such Series
representing more than 50% of the sum of the total Incremental Facility Loans of
such Series and unused Incremental Facility Commitments of such Series at such
time.
"Required Lenders" means, at any time, Lenders having Revolving
----------------
Exposures, Term Loans, Incremental Facility Loans and unused Commitments
representing more than 50% of the sum of the total Revolving Exposures,
outstanding Term Loans and Incremental Facility Loans and unused Commitments at
such time.
"Required Revolving Lenders" means, at any time, Revolving Lenders
--------------------------
having Revolving Exposures and unused Commitments representing more than 50% of
the sum of the total Revolving Exposures and unused Commitments at such time.
-25-
"Required Term Lenders" means Lenders having Term Loans representing
---------------------
more than 50% of the sum of the total Term Loans at such time.
"Restricted Debt Payment" means any purchase, redemption, retirement
-----------------------
or acquisition for value, or the setting apart of any money for a sinking,
defeasance or other analogous fund for the purchase, redemption, retirement or
other acquisition of, or any voluntary payment or prepayment of the principal of
or interest on, or any other amount owing in respect of, the Senior Subordinated
Notes or any Additional Permitted Indebtedness, provided that the term
--------
"Restricted Debt Payment" shall not include (x) the repurchase of the Senior
Subordinated Notes resulting from a "change of control event" in connection with
the Merger Transactions, (y) regularly scheduled payments of principal or
interest in respect of the Senior Subordinated Notes or (z) regularly scheduled
payments of principal or interest in respect of Additional Permitted
Indebtedness, in the case of each of the foregoing clauses (y) and (z), to the
extent required pursuant to the instruments evidencing the Senior Subordinated
Notes or such Additional Permitted Indebtedness, as the case may be.
"Restricted Payments" means, collectively, any Dividend Payment and
-------------------
any Restricted Debt Payment.
"Revolving Availability Period" means the period from and including
-----------------------------
the Effective Date to but excluding the earlier of the Maturity Date and the
date of termination of the Commitments.
"Revolving Commitment" means, with respect to each Lender, the
--------------------
commitment, if any, of such Lender to make Revolving Loans and to acquire
participations in Letters of Credit and Swingline Loans hereunder, expressed as
an amount representing the maximum aggregate amount of such Lender's Revolving
Exposure hereunder, as such commitment may be (a) reduced from time to time
pursuant to Section 2.08 and (b) reduced or increased from time to time pursuant
to assignments by or to such Lender pursuant to Section 10.04. The amount of
each Lender's Revolving Commitment as of the date hereof is set forth on
Schedule I, and (after giving effect to any assignment of any Commitment
permitted under Section 10.04) in the Assignment and Acceptance pursuant to
which such Lender shall have assumed its Revolving Commitment, as applicable.
The aggregate original amount of the Lenders' Revolving Commitments is
$1,000,000,000.
"Revolving Exposure" means, with respect to any Lender at any time,
------------------
the sum of the outstanding principal amount of such Lender's Revolving Loans and
its LC Exposure and Swingline Exposure at such time.
"Revolving Lenders" means a Lender with a Revolving Commitment or, if
-----------------
the Revolving Commitments have terminated or expired, a Lender with Revolving
Exposure.
"Revolving Loan" means a Loan made pursuant to Section 2.01(a).
--------------
-26-
"Senior Subordinated Notes" means the 9 3/4% Senior Subordinated Notes
-------------------------
due 2005 issued by the Borrower pursuant to an Indenture dated as of October 27,
0000, xxxxxxx xxx Xxxxxxxx xxx Xxxxxx Xxxxxx Trust Company of New York, as
trustee.
"Series" has the meaning set forth in Section 2.01(c).
------
"Station Licenses" means all authorizations, licenses or permits
----------------
issued by the FCC and granted or assigned to the Borrower or any Consolidated
Subsidiary thereof, or under which the Borrower or any Consolidated Subsidiary
thereof has the right to operate any Station, together with any extensions or
renewals thereof.
"Stations" means the television broadcasting stations from time to
--------
time owned by the Borrower or any of its Consolidated Subsidiaries. Immediately
after giving effect to the Merger, the Stations will consist of the Argyle
Stations and the Hearst Stations.
"Statutory Reserve Rate" means, for any day, a fraction (expressed as
----------------------
a decimal), the numerator of which is the number one and the denominator of
which is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board and in effect on such day to which the
Administrative Agent is subject (a) with respect to the Base CD Rate, for new
negotiable nonpersonal time deposits in dollars of over $100,000 with maturities
approximately equal to three months and (b) with respect to the Adjusted LIBO
Rate, for eurocurrency funding (currently referred to as "Eurocurrency
Liabilities" in Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. Eurodollar Loans shall be
deemed to constitute eurocurrency funding and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D or
any comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage. The Statutory Reserve Rate as of the date hereof is zero.
"Subsidiary" means, with respect to any Person (the "parent") at any
---------- ------
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent. Unless otherwise
specified, "Subsidiary" means a subsidiary of the Borrower.
-27-
"Subsidiary Guarantor" means each of the Subsidiaries of the Borrower
--------------------
identified under the caption "SUBSIDIARY GUARANTORS" on the signature pages
hereto and each Subsidiary of the Borrower that becomes a "Subsidiary Guarantor"
after the date hereof pursuant to Section 6.09(c).
"Swingline Exposure" means, at any time, the aggregate principal
------------------
amount of all Swingline Loans outstanding at such time. The Swingline Exposure
of any Lender at any time shall be its Applicable Percentage of the total
Swingline Exposure at such time.
"Swingline Lender" means The Chase Manhattan Bank and Xxxxxx Guaranty
----------------
Trust Company of New York, each in its capacity as lender of Swingline Loans
hereunder, as the case may be.
"Swingline Loan" means a Loan made pursuant to Section 2.04.
--------------
"Tax Sharing Agreement" means the Tax Sharing Agreement between Hearst
---------------------
and the Borrower to be executed in connection with the Merger Transactions, a
form of which is attached as Exhibit 9.02(f) to the Merger Agreement.
"Taxes" means any and all present or future taxes, levies, imposts,
-----
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Term Loan" means the portion of the Revolving Loans converted
---------
pursuant to Section 2.01(b).
"Three-Month Secondary CD Rate" means, for any day, the secondary
------------------------------
market rate for three-month certificates of deposit reported as being in effect
on such day (or, if such day is not a Business Day, the next preceding Business
Day) by the Board through the public information telephone line of the Federal
Reserve Bank of New York (which rate will, under the current practices of the
Board, be published in Federal Reserve Statistical Release H.15(519) during the
week following such day) or, if such rate is not so reported on such day or such
next preceding Business Day, the average of the secondary market quotations for
three-month certificates of deposit of major money center banks in New York City
received at approximately 10:00 a.m., New York City time, on such day (or, if
such day is not a Business Day, on the next preceding Business Day) by the
Administrative Agent from three negotiable certificate of deposit dealers of
recognized standing selected by it.
"Transactions" means the execution, delivery and performance by each
------------
Obligor of this Agreement and the other Basic Documents to which such Obligor is
intended to be a party, the borrowing of Loans, the use of the proceeds thereof
and the issuance of Letters of Credit hereunder.
-28-
"Type", when used in reference to any Loan or Borrowing, refers to
----
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"Wholly Owned Subsidiary" means, with respect to any Person, any
-----------------------
corporation, partnership or other entity of which all of the equity securities,
Equity Rights or other ownership interests (other than, in the case of a
corporation, directors' qualifying shares) are directly or indirectly owned or
controlled by such Person or one or more Wholly Owned Subsidiaries of such
Person or by such Person and one or more Wholly Owned Subsidiaries of such
Person.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
--------------------
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Classification of Loans and Borrowings. For purposes
--------------------------------------
of this Agreement, Loans may be classified and referred to by Class (e.g., a
"Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class and Type
(e.g., an "ABR Revolving Loan"); each Series of Incremental Facility Loans shall
be deemed a separate Class of Loans hereunder. Borrowings also may be
classified and referred to by Class (e.g., a "Revolving Borrowing") or by Type
(e.g., a "Eurodollar Borrowing") or by Class and Type (e.g., an "ABR Revolving
Borrowing"); each Series of Incremental Facility Borrowings and Incremental
Facility Commitments shall be deemed a separate Borrowing and Commitment
hereunder.
SECTION 1.03. Terms Generally. The definitions of terms herein shall
---------------
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including"
shall be deemed to be followed by the phrase "without limitation". The word
"will" shall be construed to have the same meaning and effect as the word
"shall". Unless the context requires otherwise (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person's successors and assigns, (c) the words "herein", "hereof" and
"hereunder", and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement and (e) the words "asset" and "property" shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.
-29-
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly
----------------------
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with, or derived by reference to, GAAP, as in effect
from time to time; provided that, if the Borrower notifies the Administrative
--------
Agent that the Borrower requests an amendment to any provision hereof to
eliminate the effect of any change occurring after the date hereof in GAAP or in
the application thereof on the operation of such provision (or if the
Administrative Agent notifies the Borrower that the Required Lenders request an
amendment to any provision hereof for such purpose), regardless of whether any
such notice is given before or after such change in GAAP or in the application
thereof, then such provision shall be interpreted on the basis of GAAP as in
effect and applied immediately before such change shall have become effective
until such notice shall have been withdrawn or such provision amended in
accordance herewith. References in this Agreement to the determination of items
"in accordance with GAAP" means that such items shall be derived by reference
-----------------------
to, and with the relevant components of such items being determined in
accordance with, GAAP even though (as is the case with terms such as "pro
forma", "Broadcast Cash Flow" and "Film Cash Payments") such terms may not have
a meaning under GAAP.
Pursuant to the Tax Sharing Agreement the Borrower and Hearst have
agreed as to the amounts that the Borrower and its Subsidiaries will be
obligated to pay to Hearst in respect of Federal income taxes. So long as the
Borrower and its Subsidiaries shall be included in consolidated Federal income
tax returns filed by Hearst pursuant to the Tax Sharing Agreement, whenever
making determinations under this Agreement of the amount of Federal income taxes
payable during any period (or the amount of refunds in respect of such taxes
receivable during any period) by the Borrower and its Subsidiaries, the amount
of such taxes payable or receivable shall be deemed to be equal to the amounts
payable or receivable, as the case may be, in respect of such taxes under the
Tax Sharing Agreement without reference to whether Hearst and its Subsidiaries
as an affiliated group shall in fact pay any amounts in respect of Federal
income taxes (or receive any amounts in respect of refunds of Federal income
taxes) during the relevant period.
To enable the ready and consistent determination of compliance with
the covenants set forth in Article VII, the Borrower will not change the last
day of its fiscal year from December 31 of each year, or the last days of the
first three fiscal quarters in each of its fiscal years from March 31, June 30
and September 30 of each year, respectively.
-30-
ARTICLE II
THE CREDITS
SECTION 2.01. The Commitments.
---------------
(a) Revolving Loans. Subject to the terms and conditions set forth
---------------
herein, each Lender agrees to make Revolving Loans to the Borrower from time to
time during the Revolving Availability Period in an aggregate principal amount
that will not result in (i) such Lender's Revolving Exposure exceeding such
Lender's Revolving Commitment or (ii) the total Revolving Exposures exceeding
the total Revolving Commitments. Within the foregoing limits and subject to the
terms and conditions set forth herein, the Borrower may borrow, prepay and
reborrow Revolving Loans.
(b) Conversion Date. On the Conversion Date (so long as on such date
---------------
the aggregate then-outstanding amount of the Revolving Commitments is at least
equal to $250,000,000), a portion of the Revolving Loans equal to the lesser of
(a) the aggregate then-outstanding principal amount of the Revolving Loans and
(b) the excess, if any, of (i) the aggregate then-outstanding amount of the
Revolving Commitments over (ii) $250,000,000, shall be automatically converted
into Term Loans, and the Revolving Commitments shall be reduced to $250,000,000,
provided that in no event shall the aggregate principal amount of Revolving
--------
Loans so converted into Term Loans be less than $50,000,000 (and, if the amount
that would otherwise be so converted shall be less than $50,000,000, the
Revolving Commitments shall instead be reduced to the sum of (x) $250,000,000
plus (y) such amount that would otherwise have been converted into Term Loans
----
but for this proviso). Term Loans, once repaid, may not be reborrowed.
(c) Incremental Facility Loans. In addition to borrowings of
--------------------------
Revolving Loans, at any time during the Incremental Facility Availability Period
the Borrower may from time to time request the Lenders offer to enter into
commitments to make additional revolving loans to the Borrower hereunder, which
commitment of any Lender shall not be less than $10,000,000 and not greater than
$250,000,000. In the event that one or more of the Lenders offer, in their sole
discretion, to enter into such commitments, and such Lenders and the Borrower
agree as to the amount of such commitments that shall be allocated to the
respective Lenders making such offers and the fees (if any) to be payable by the
Borrower in connection therewith, such Lenders shall become obligated to make
Incremental Facility Loans under this Agreement in an amount equal to the amount
of their respective Incremental Facility Commitments. The Incremental Facility
Loans to be made pursuant to any such agreement between the Borrower and one or
more Lenders in response to any such request by the Borrower shall be deemed to
be a separate "Series" of Incremental Facility Loans for all purposes of this
------
Agreement. Anything herein to the contrary notwithstanding, (i) the minimum
aggregate principal amount of Incremental Facility Commitments entered into
pursuant to any such request (and, accordingly, the minimum aggregate principal
amount of
-31-
any Series of Incremental Facility Loans) shall be $25,000,000 and (ii) the
aggregate principal amount of all Commitments and Borrowings of Incremental
Facility Loans shall not exceed $250,000,000.
Following agreement by the Borrower and one or more of the Lenders as
provided above, subject to the terms and conditions set forth herein, each
Incremental Facility Lender of any Series agrees to make Incremental Facility
Loans of such Series to the Borrower from time to time during the period from
and including the date of such agreement to but not including the Maturity Date,
in an aggregate principal amount up to but not exceeding the amount of the
Incremental Facility Commitment of such Series of such Incremental Facility
Lender. Within the foregoing limits and subject to the terms and conditions set
forth herein, the Borrower may borrow, prepay and reborrow Incremental Facility
Loans of any Series as the Borrower shall from time to time select.
SECTION 2.02. Loans and Borrowings.
--------------------
(a) Obligation of Lenders. Each Loan shall be made as part of a
---------------------
Borrowing consisting of Loans of the same Class and Type made by the Lenders
ratably in accordance with their respective Commitments of the applicable Class.
The failure of any Lender to make any Loan required to be made by it shall not
relieve any other Lender of its obligations hereunder; provided that the
--------
Commitments of the Lenders are several and no Lender shall be responsible for
any other Lender's failure to make Loans as required.
(b) Type of Loans. Subject to Sections 2.04 and 2.13, each Borrowing
-------------
shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may
request in accordance herewith. Each Lender at its option may make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan; provided that any exercise of such option shall not
--------
affect the obligation of the Borrower to repay such Loan in accordance with the
terms of this Agreement, except that if the designation of any such foreign
branch or Affiliate shall result in any costs, reductions or taxes which would
not otherwise have been applicable, such Lender shall not be entitled to
compensation for such costs, reductions or taxes unless it shall in good faith
have determined such designation to be necessary or advisable to avoid any
material disadvantage to it.
(c) Minimum Amounts. At the commencement of each Interest Period for
---------------
any Eurodollar Borrowing, such Borrowing shall be in an aggregate amount of
$5,000,000 or a larger multiple of $1,000,000. At the time that each ABR
Borrowing is made, such Borrowing shall be in an aggregate amount equal to
$1,000,000 or a larger multiple of $1,000,000; provided that an ABR Borrowing
--------
may be in an aggregate amount that is equal to the entire unused balance of the
total Commitments of the applicable Class or that is required to finance the
reimbursement of an LC Disbursement as contemplated by Section 2.05(f).
Swingline Loans shall be in an aggregate amount equal to at least $500,000 or a
larger multiple of $100,000. Borrowings of more than one Type and Class may be
outstanding at
-32-
the same time; provided that there shall not at any time be more than a total of
--------
12 Eurodollar Borrowings outstanding.
(e) Conversion or Continuation of Eurodollar Loans. Notwithstanding
----------------------------------------------
any other provision of this Agreement, the Borrower shall not be entitled to
request, or to elect to convert or continue as a Eurodollar Loan: (i) any
Borrowing if the Interest Period requested with respect thereto would end after
the Maturity Date; or (ii) any Term Loan, or Incremental Facility Loan of any
Series, if the Interest Period therefor would commence before and end after any
Principal Payment Date (in the case of a Term Loan) or Incremental Facility
Commitment Reduction Date (in the case of any Series of Incremental Facility
Loan) unless, after giving effect thereto, the aggregate principal amount of the
Term Loans having Interest Periods that end after such Principal Payment Date,
or Incremental Facility Loans of such Series having Interest Periods that end
after such Incremental Facility Commitment Reduction Date, shall be equal to or
less than the aggregate principal amount of the Term Loans or Incremental
Facility Loans of such Series, as applicable, permitted to be outstanding after
giving effect to the payments of principal required to be made on such Principal
Payment Date or Incremental Facility Commitment Reduction Date, as the case may
be.
SECTION 2.03. Requests for Borrowings. To request a Borrowing (other
-----------------------
than in respect of a Borrowing comprised of a Swingline Loan, as to which the
provisions of Section 2.04 shall apply), the Borrower shall notify the
Administrative Agent of such request by telephone (a) in the case of a
Eurodollar Borrowing, not later than 12:00 noon, New York City time, three
Business Days before the date of the proposed Borrowing or (b) in the case of an
ABR Borrowing, not later than 12:00 noon, New York City time, one Business Day
before the date of the proposed Borrowing; provided that any such notice of an
--------
ABR Revolving Borrowing to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.05(f) may be given not later than 10:00 a.m., New York
City time, on the date of the proposed Borrowing. Each such telephonic
Borrowing Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Borrowing Request
in a form approved by the Administrative Agent and signed by the Borrower. Each
such telephonic and written Borrowing Request shall specify the following
information in compliance with Section 2.02:
(i) whether the requested Borrowing is to be a Revolving
Borrowing or Incremental Facility Borrowing (including, if applicable, the
respective Series of Incremental Facility to which such Borrowing relates);
(ii) the aggregate amount of the requested Borrowing;
(iii) the date of such Borrowing, which shall be a Business Day;
(iv) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
-33-
(v) in the case of a Eurodollar Borrowing, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by
the definition of the term "Interest Period"; and
(vi) the location and number of the Borrower's account to which
funds are to be disbursed, which shall comply with the requirements of
Section 2.06.
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed
to have selected an Interest Period of one month's duration. Promptly following
receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.04. Swingline Loans.
---------------
(a) Agreement to Make Swingline Loans. Subject to the terms and
---------------------------------
conditions set forth herein, each Swingline Lender agrees to make Swingline
Loans to the Borrower from time to time during the Revolving Availability
Period, in an aggregate principal amount at any time outstanding that will not
result in (i) the aggregate principal amount of outstanding Swingline Loans
exceeding $20,000,000 or (ii) the total Revolving Exposures exceeding the total
Revolving Commitments; provided that neither Swingline Lender shall be required
--------
to make a Swingline Loan to refinance an outstanding Swingline Loan. Within the
foregoing limits and subject to the terms and conditions set forth herein, the
Borrower may borrow, prepay and reborrow Swingline Loans. Swingline Loans made
hereunder shall constitute utilization of the Revolving Commitments and shall
reduce the availability of such Revolving Commitments on a dollar-for-dollar
basis.
(b) Interest Rates. Swingline Loans shall be ABR Loans, except that
--------------
a Swingline Lender and the Borrower may agree that the interest rate in respect
of a Swingline Loan made by such Swingline Lender be at an alternative rate of
interest (and with such applicable margins and prepayment premiums) as may from
time to time be offered by such Swingline Lender to the Borrower in its sole
discretion; provided that upon any sale pursuant to Section 2.04(d) of
--------
participations in any Swingline Loan the interest on which is determined by
reference to such an alternative rate, such Swingline Loans shall automatically
be converted into an ABR Loan.
(c) Notice of Swingline Loans by Borrower. To request a Swingline
-------------------------------------
Loan, the Borrower shall notify the Administrative Agent of such request by
telephone (confirmed by telecopy), not later than 12:00 noon, New York City
time, on the day of a proposed Swingline Loan. Each such notice shall be
irrevocable and shall specify the requested date (which shall be a Business Day)
and amount of the requested Swingline Loan and the respective Swingline Lender
from which the Borrower wishes to make such Borrowing. The
-34-
Administrative Agent will promptly advise the respective Swingline Lender of any
such notice received from the Borrower. A Swingline Lender shall make each
Swingline Loan available to the Borrower by means of a credit to the general
deposit account of the Borrower with the Administrative Agent or such Swingline
Lender (or, in the case of a Swingline Loan made to finance the reimbursement of
an LC Disbursement as provided in Section 2.05(f), by remittance to the Issuing
Lender) by 3:00 p.m., New York City time, on the requested date of such
Swingline Loan.
(d) Participations by Lenders in Swingline Loans. A Swingline Lender
--------------------------------------------
may by written notice given to the Administrative Agent (with a copy to the
Borrower) not later than 10:00 a.m., New York City time, on any Business Day
require the Lenders to acquire participations on such Business Day in all or a
portion of the Swingline Loans of such Swingline Lender outstanding. Such
notice to the Administrative Agent shall specify the aggregate amount of
Swingline Loans in which Lenders will participate. Promptly upon receipt of
such notice, the Administrative Agent will give notice thereof to each Lender,
specifying in such notice such Lender's Applicable Percentage of such Swingline
Loan or Loans. Each Lender hereby absolutely and unconditionally agrees, upon
receipt of notice as provided above in this paragraph, to pay to the
Administrative Agent, for the account of the respective Swingline Lender, such
Lender's Applicable Percentage of such Swingline Loan or Loans. Each Lender
acknowledges and agrees that its obligation to acquire participations in
Swingline Loans pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including the occurrence
and continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever. Each Lender shall comply with its obligation under
this paragraph by wire transfer of immediately available funds, in the same
manner as provided in Section 2.06 with respect to Loans made by such Lender
(and Section 2.06 shall apply, mutatis mutandis, to the payment obligations of
------- --------
the Lenders), and the Administrative Agent shall promptly pay to the respective
Swingline Lender the amounts so received by it from the Lenders. The
Administrative Agent shall notify the Borrower of any participations in any
Swingline Loan acquired pursuant to this paragraph, and thereafter payments in
respect of such Swingline Loan shall be made to the Administrative Agent and not
to such Swingline Lender. Any amounts received by a Swingline Lender from the
Borrower (or other party on behalf of the Borrower) in respect of a Swingline
Loan after receipt by such Swingline Lender of the proceeds of a sale of
participations therein shall be promptly remitted to the Administrative Agent;
any such amounts received by the Administrative Agent shall be promptly remitted
by the Administrative Agent to the Lenders that shall have made their payments
pursuant to this paragraph and to the respective Swingline Lender, as their
interests may appear. The purchase of participations in a Swingline Loan
pursuant to this paragraph shall not relieve the Borrower of any default in the
payment thereof.
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SECTION 2.05. Letters of Credit.
-----------------
(a) General. Subject to the terms and conditions set forth herein,
-------
in addition to the Loans provided for in Section 2.01, the Borrower may request
the Issuing Lender to issue, at any time and from time to time during the
Revolving Availability Period, Letters of Credit for its own account in such
form as is acceptable to the Issuing Lender in its reasonable determination.
Letters of Credit issued hereunder shall constitute utilization of the Revolving
Commitments.
(b) Notice of Issuance, Amendment, Renewal or Extension. To request
---------------------------------------------------
the issuance of a Letter of Credit (or the amendment, renewal or extension of an
outstanding Letter of Credit), the Borrower shall hand deliver or telecopy (or
transmit by electronic communication, if arrangements for doing so have been
approved by the Issuing Lender) to the Issuing Lender and the Administrative
Agent (reasonably in advance of the requested date of issuance, amendment,
renewal or extension) a notice requesting the issuance of a Letter of Credit, or
identifying the Letter of Credit to be amended, renewed or extended, and
specifying the date of issuance, amendment, renewal or extension (which shall be
a Business Day), the date on which such Letter of Credit is to expire (which
shall comply with paragraph (d) of this Section), the amount of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare, amend, renew or extend such Letter
of Credit. If requested by the Issuing Lender, the Borrower also shall submit a
letter of credit application on the Issuing Lender's standard form in connection
with any request for a Letter of Credit. In the event of any inconsistency
between the terms and conditions of this Agreement and the terms and conditions
of any form of letter of credit application or other agreement submitted by the
Borrower to, or entered into by the Borrower with, the Issuing Lender relating
to any Letter of Credit, the terms and conditions of this Agreement shall
control.
(c) Limitations on Amounts. A Letter of Credit shall be issued,
----------------------
amended, renewed or extended only if (and upon issuance, amendment, renewal or
extension of each Letter of Credit the Borrower shall be deemed to represent and
warrant that), after giving effect to such issuance, amendment, renewal or
extension (i) the aggregate LC Exposure of the Issuing Lender (determined for
these purposes without giving effect to the participations therein of the
Lenders pursuant to paragraph (e) of this Section) shall not exceed $50,000,000
and (ii) the total Revolving Exposures shall not exceed the total Revolving
Commitments.
(d) Expiration Date. Each Letter of Credit shall expire at or prior
---------------
to the close of business on the earlier of (i) the date 12 months after the date
of the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, 12 months after such renewal or extension) and (ii) the date
that is five Business Days prior to the Maturity Date.
(e) Participations. By the issuance of a Letter of Credit (or an
--------------
amendment to a Letter of Credit increasing the amount thereof) by the Issuing
Lender, and without any further
-36-
action on the part of the Issuing Lender or the Lenders, the Issuing Lender
hereby grants to each Lender, and each Lender hereby acquires from the Issuing
Lender, a participation in such Letter of Credit equal to such Lender's
Applicable Percentage of the aggregate amount available to be drawn under such
Letter of Credit. Each Lender acknowledges and agrees that its obligation to
acquire participations pursuant to this paragraph in respect of Letters of
Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.
In consideration and in furtherance of the foregoing, each Lender
hereby absolutely and unconditionally agrees to pay to the Administrative Agent,
for the account of the Issuing Lender, such Lender's Applicable Percentage of
each LC Disbursement made by the Issuing Lender promptly upon the request of the
Issuing Lender at any time from the time of such LC Disbursement until such LC
Disbursement is reimbursed by the Borrower or at any time after any
reimbursement payment is required to be refunded to the Borrower for any reason.
Each such payment shall be made in the same manner as provided in Section 2.06
with respect to Loans made by such Lender (and Section 2.06 shall apply, mutatis
-------
mutandis, to the payment obligations of the Lenders), and the Administrative
--------
Agent shall promptly pay to the Issuing Lender the amounts so received by it
from the Lenders. Promptly following receipt by the Administrative Agent of any
payment from the Borrower pursuant to the next following paragraph, the
Administrative Agent shall distribute such payment to the Issuing Lender or, to
the extent that the Lenders have made payments pursuant to this paragraph to
reimburse the Issuing Lender, then to such Lenders and the Issuing Lender as
their interests may appear. Any payment made by a Lender pursuant to this
paragraph to reimburse the Issuing Lender for any LC Disbursement shall not
constitute a Loan and shall not relieve the Borrower of its obligation to
reimburse such LC Disbursement.
(f) Reimbursement. If the Issuing Lender shall make any LC
-------------
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse the
Issuing Lender in respect of such LC Disbursement by paying to the
Administrative Agent an amount equal to such LC Disbursement not later than
12:00 noon, New York City time, on (i) the Business Day that the Borrower
receives notice of such LC Disbursement, if such notice is received prior to
10:00 a.m., New York City time, or (ii) the Business Day immediately following
the day that the Borrower receives such notice, if such notice is not received
prior to such time, provided that, if such LC Disbursement is not less than
--------
$100,000 the Borrower may, subject to the conditions to borrowing set forth
herein, request in accordance with Section 2.03 or 2.04 that such payment be
financed with an ABR Revolving Borrowing or Swingline Loan in an equivalent
amount and, to the extent so financed, the Borrower's obligation to make such
payment shall be discharged and replaced by the resulting ABR Revolving
Borrowing or Swingline Loan.
-37-
If the Borrower fails to make such payment when due, the
Administrative Agent shall notify each Lender of the applicable LC Disbursement,
the payment then due from the Borrower in respect thereof and such Lender's
Applicable Percentage thereof.
(g) Obligations Absolute. The Borrower's obligation to reimburse LC
--------------------
Disbursements as provided in paragraph (f) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment by the Issuing Lender under a Letter of Credit against
presentation of a draft or other document that does not comply strictly with the
terms of such Letter of Credit, and (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of the
Borrower's obligations hereunder.
Neither the Administrative Agent, the Lenders nor the Issuing Lender,
nor any of their Related Parties, shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of Credit
by the Issuing Lender or any payment or failure to make any payment thereunder
(irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission
or delivery of any draft, notice or other communication under or relating to any
Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation of technical terms or any consequence arising from
causes beyond the control of the Issuing Lender; provided that the foregoing
--------
shall not be construed to excuse the Issuing Lender from liability to the
Borrower to the extent of any direct damages (as opposed to consequential
damages, claims in respect of which are hereby waived by the Borrower to the
extent permitted by applicable law) suffered by the Borrower that are caused by
the Issuing Lender's gross negligence or wilful misconduct when determining
whether drafts and other documents presented under a Letter of Credit comply
with the terms thereof. The parties hereto expressly agree that:
(i) the Issuing Lender may accept documents that it believes in
good faith appear on their face to be in substantial compliance with the
terms of a Letter of Credit without responsibility for further
investigation, regardless of any notice or information to the contrary, and
may make payment upon presentation of documents that appear on their face
to be in substantial compliance with the terms of such Letter of Credit;
(ii) the Issuing Lender shall have the right, in its sole
discretion, to decline to accept such documents and to decline to make such
payment if such documents are not in strict compliance with the terms of
such Letter of Credit; and
-38-
(iii) this sentence shall establish the standard of care to be
exercised by the Issuing Lender when determining whether drafts and other
documents presented under a Letter of Credit comply with the terms thereof
(and the parties hereto hereby waive, to the extent permitted by applicable
law, any standard of care inconsistent with the foregoing).
(h) Disbursement Procedures. The Issuing Lender shall, within a
-----------------------
reasonable time following its receipt thereof, examine all documents purporting
to represent a demand for payment under a Letter of Credit. The Issuing Lender
shall promptly after such examination notify the Administrative Agent and the
Borrower by telephone (confirmed by telecopy) of such demand for payment and
whether the Issuing Lender has made or will make an LC Disbursement thereunder;
provided that any failure to give or delay in giving such notice shall not
--------
relieve the Borrower of its obligation to reimburse the Issuing Lender and the
Lenders with respect to any such LC Disbursement.
(i) Interim Interest. If the Issuing Lender shall make any LC
----------------
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Loans; provided that,
--------
if the Borrower fails to reimburse such LC Disbursement when due pursuant to
paragraph (f) of this Section, then Section 2.12(d) shall apply. Interest
accrued pursuant to this paragraph shall be for the account of the Issuing
Lender, except that interest accrued on and after the date of payment by any
Lender pursuant to paragraph (f) of this Section to reimburse the Issuing Lender
shall be for the account of such Lender to the extent of such payment.
(j) Replacement of the Issuing Lender. The Issuing Lender may be
---------------------------------
replaced at any time by written agreement among the Borrower, the Administrative
Agent, the replaced Issuing Lender and the successor Issuing Lender. The
Administrative Agent shall notify the Lenders of any such replacement of the
Issuing Lender. At the time any such replacement shall become effective, the
Borrower shall pay all unpaid fees accrued for the account of the replaced
Issuing Lender pursuant to Section 2.11(b). From and after the effective date
of any such replacement, (i) the successor Issuing Lender shall have all the
rights and obligations of the replaced Issuing Lender under this Agreement with
respect to Letters of Credit to be issued thereafter and (ii) references herein
to the term "Issuing Lender" shall be deemed to refer to such successor or to
any previous Issuing Lender, or to such successor and all previous Issuing
Lenders, as the context shall require. After the replacement of an Issuing
Lender hereunder, the replaced Issuing Lender shall remain a party hereto and
shall continue to have all the rights and obligations of an Issuing Lender under
this Agreement with respect to Letters of Credit issued by it prior to such
replacement, but shall not be required to issue additional Letters of Credit.
-39-
(k) Cash Collateralization. If either (i) an Event of Default shall
----------------------
occur and be continuing and the Borrower receives notice from the Administrative
Agent or the Required Lenders (or, if the maturity of the Loans has been
accelerated, Lenders with LC Exposure representing more than 50% of the total LC
Exposure) demanding the deposit of cash collateral pursuant to this paragraph,
or (ii) the Borrower shall be required to provide cover for LC Exposure pursuant
to Sections 2.09 and 2.10, the Borrower shall immediately deposit into an
account with the Administrative Agent, in the name of the Administrative Agent
and for the benefit of the Lenders, an amount in cash equal to, in the case of
an Event of Default, the LC Exposure as of such date plus any accrued and unpaid
interest thereon and, in the case of cover pursuant to Section 2.10, the amount
required under Section 2.10, provided that the obligation to deposit such cash
--------
collateral shall become effective immediately, and such deposit shall become
immediately due and payable, without demand or other notice of any kind, upon
the occurrence of any Event of Default with respect to the Borrower described in
clause (i) or (j) of Article VIII. Such deposit shall be held by the
Administrative Agent as collateral for the LC Exposure under this Agreement.
(l) Existing Letters of Credit. Pursuant to Section 2.10(a) of the
--------------------------
Existing Credit Agreement, the Issuing Lender may from time to time have issued
"Revolving Letters of Credit" (as defined therein). Each of the parties hereto
agrees that any such "Revolving Letter of Credit" that shall be outstanding on
the Effective Date shall constitute, on and after the Effective Date, a Letter
of Credit for all purposes of this Agreement.
SECTION 2.06. Funding of Borrowings.
---------------------
(a) Funding by Lenders. Each Lender shall make each Loan to be made
------------------
by it hereunder on the proposed date thereof by wire transfer of immediately
available funds by 12:00 noon, New York City time, to the account of the
Administrative Agent most recently designated by it for such purpose by notice
to the Lenders; provided that Swingline Loans shall be made as provided in
--------
Section 2.04. The Administrative Agent will make such Loans available to the
Borrower by promptly crediting the amounts so received, in like funds, to an
account of the Borrower maintained with the Administrative Agent in New York
City and designated by the Borrower in the applicable Borrowing Request;
provided that ABR Revolving Borrowings made to finance the reimbursement of an
--------
LC Disbursement as provided in Section 2.05(f) shall be remitted by the
Administrative Agent to the Issuing Lender.
(b) Presumption by Administrative Agent. Unless the Administrative
-----------------------------------
Agent shall have received notice from a Lender prior to the proposed date of any
Borrowing that such Lender will not make available to the Administrative Agent
such Lender's share of such Borrowing, the Administrative Agent may assume that
such Lender has made such share available on such date in accordance with
paragraph (a) of this Section and may, in reliance upon such assumption, make
available to the Borrower a corresponding amount. In such event, if a Lender
has not in fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the Borrower severally
agree to pay to
-40-
the Administrative Agent forthwith on demand such corresponding amount with
interest thereon, for each day from and including the date such amount is made
available to the Borrower to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the Federal Funds
Effective Rate or (ii) in the case of the Borrower, the interest rate applicable
to ABR Loans. If such Lender pays such amount to the Administrative Agent, then
such amount shall constitute such Lender's Loan included in such Borrowing.
SECTION 2.07. Interest Elections.
------------------
(a) Elections by Borrower. Each Borrowing initially shall be of the
---------------------
Type specified in the applicable Borrowing Request and, in the case of a
Eurodollar Borrowing, shall have an initial Interest Period as specified in such
Borrowing Request. Thereafter, the Borrower may elect to convert such Borrowing
to a different Type or to continue such Borrowing and, in the case of a
Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in
this Section. The Borrower may elect different options with respect to
different portions of the affected Borrowing, in which case each such portion
shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing. This Section shall not apply to Swingline Borrowings, which
may not be converted or continued.
(b) Notice of Elections. To make an election pursuant to this
-------------------
Section, the Borrower shall notify the Administrative Agent of such election by
telephone by the time that a Borrowing Request would be required under Section
2.03 if the Borrower were requesting a Borrowing of the Type resulting from such
election to be made on the effective date of such election. Each such
telephonic Interest Election Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Interest Election Request in a form approved by the Administrative Agent and
signed by the Borrower.
(c) Information in Election Notices. Each telephonic and written
-------------------------------
Interest Election Request shall specify the following information in compliance
with Section 2.02:
(i) the Borrowing to which such Interest Election Request
applies (including, if applicable, the respective Series of Incremental
Facility Loans to which such Interest Election Request relates) and, if
different options are being elected with respect to different portions
thereof, the portions thereof to be allocated to each resulting Borrowing
(in which case the information to be specified pursuant to clauses (iii)
and (iv) of this paragraph shall be specified for each resulting
Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
-41-
(iii) whether the resulting Borrowing is to be an ABR Borrowing
or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Notice by Administrative Agent to Lenders. Promptly following
-----------------------------------------
receipt of an Interest Election Request, the Administrative Agent shall advise
each relevant Lender of the details thereof and of such Lender's portion of each
resulting Borrowing.
(e) Presumptions if no Notice. If the Borrower fails to deliver a
-------------------------
timely Interest Election Request with respect to a Eurodollar Borrowing prior to
the end of the Interest Period applicable thereto, then, unless such Borrowing
is repaid as provided herein, at the end of such Interest Period such Borrowing
shall be converted to an ABR Borrowing. Notwithstanding any contrary provision
hereof, if an Event of Default has occurred and is continuing and the
Administrative Agent, at the request of the Required Lenders, so notifies the
Borrower, then, so long as an Event of Default is continuing (i) no outstanding
Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii)
unless repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing
at the end of the Interest Period applicable thereto.
SECTION 2.08. Termination and Reduction of the Commitments.
--------------------------------------------
(a) Scheduled Termination. Unless previously terminated, (i) the
---------------------
Revolving Commitments shall terminate on the Maturity Date and (ii) the
Incremental Facility Commitments shall terminate on the Maturity Date.
(b) Voluntary Termination or Reduction. The Borrower may at any time
----------------------------------
terminate, or from time to time reduce, the Commitments of any Class (including
the Commitments of any Series of Incremental Facility Loans); provided that (i)
--------
each reduction of the Commitments of any Class pursuant to this Section shall be
in an amount that is $5,000,000 or a larger multiple of $1,000,000 and (ii) the
Borrower shall not terminate or reduce the Revolving Commitments if, after
giving effect to any concurrent prepayment of the Loans in accordance with
Section 2.10, the total Revolving Exposures would exceed the total Revolving
Commitments.
(c) Notice of Termination or Reduction. The Borrower shall notify
----------------------------------
the Administrative Agent of any election to terminate or reduce the Commitments
of any Class
-42-
under paragraph (b) of this Section at least three Business Days prior to the
effective date of such termination or reduction, specifying such election and
the effective date thereof. Promptly following receipt of any notice, the
Administrative Agent shall advise the Lenders of the contents thereof. Each
notice delivered by the Borrower pursuant to this Section shall be irrevocable;
provided that a notice of termination of the Revolving Commitments delivered by
--------
the Borrower may state that such notice is conditioned upon the effectiveness of
other credit facilities, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied.
(d) Effect of Termination or Reduction. Any termination or reduction
----------------------------------
of the Commitments of any Class shall be permanent. Each reduction of the
Commitments of any Class shall be made ratably among the Lenders in accordance
with their respective Commitments of such Class.
(e) Conversion Date Reduction of Revolving Commitments. The
--------------------------------------------------
Revolving Commitments shall be automatically reduced on the Conversion Date in
the manner and to the extent provided in Section 2.01(b).
(f) Reduction of Incremental Facility Commitments. The aggregate
---------------------------------------------
amount of the Incremental Facility Commitments of each Series will be
automatically reduced to zero on the Maturity Date. In addition, the aggregate
amount of the Incremental Facility Commitments of each Series shall be
automatically reduced at the close of business on each Incremental Facility
Commitment Reduction Date set forth in column (A) below by an amount (subject to
reduction as provided below) equal to the percentage of the original aggregate
principal amount of the Incremental Facility Commitments of such Series set
forth in column (B) below opposite such Incremental Facility Commitment
Reduction Date:
(A) (B)
Incremental Facility Incremental Facility
Commitment Reduction Commitments Reduced by the
Date Falling on or Percentages of Original Incremental
Nearest to: Facility Commitments (%)
---------- ------------------------
March 31, 2001 6.25%
June 30, 2001 6.25%
September 30, 2001 6.25%
December 31, 2001 6.25%
March 31, 2002 6.25%
June 30, 2002 6.25%
September 30, 2002 6.25%
December 31, 2002 6.25%
-43-
March 31, 2003 6.25%
June 30, 2003 6.25%
September 30, 2003 6.25%
December 31, 2003 6.25%
March 31, 2004 6.25%
June 30, 2004 6.25%
September 30, 2004 6.25%
December 31, 2004 6.25%
Each reduction in Incremental Facility Commitments of any Series pursuant to
paragraph (b) of this Section shall be applied as follows: first, such
-----
reduction shall be applied to the first installment set forth in the schedule
above for the calendar year immediately following the calendar year in which
such reduction occurs and, second, after such first installment shall have been
------
reduced in full, such reduction shall be applied to the remaining installments
set forth in the schedule above ratably in accordance with the respective
amounts thereof.
SECTION 2.09. Repayment of Loans; Evidence of Debt.
------------------------------------
(a) Repayment. The Borrower hereby unconditionally promises to pay
---------
the Loans outstanding hereunder as follows:
(i) to the Administrative Agent for the account of each Lender
the outstanding principal amount of each Revolving Loan of such Lender on
the Maturity Date,
(ii) to the Administrative Agent for the account of each Lender
the outstanding principal amount of each Term Loan of such Lender on each
Principal Payment Date set forth below in an amount equal to the percentage
of the original principal amount of such Term Loan on the Conversion Date
set forth opposite such Principal Payment Date:
Percentage of
Aggregate Principal
Principal Payment Date Amount Outstanding
---------------------- ------------------
March 31, 2000 2.50%
June 30, 2000 2.50%
September 30, 2000 2.50%
December 31, 2000 2.50%
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March 31, 2001 3.75%
June 30, 2001 3.75%
September 30, 2001 3.75%
December 31, 2001 3.75%
March 31, 2002 5.00%
June 30, 2002 5.00%
September 30, 2002 5.00%
December 31, 2002 5.00%
March 31, 2003 6.25%
June 30, 2003 6.25%
September 30, 2003 6.25%
December 31, 2003 6.25%
March 31, 2004 7.50%
June 30, 2004 7.50%
September 30, 2004 7.50%
December 31, 2004 7.50%,
(iii) to the Administrative Agent for the account of each
Incremental Facility Lender the outstanding principal amount of each
Incremental Facility Loan of such Lender on the Maturity Date and
(iv) to each Swingline Lender the outstanding principal amount
of each Swingline Loan made by such Swingline Lender on the earlier of the
Maturity Date and the first date after such Swingline Loan is made that is
the last day of a calendar month and that is at least two Business Days
after such Swingline Loan is made.
(b) Manner of Repayment. Prior to any repayment or prepayment of any
-------------------
Borrowings hereunder, the Borrower shall select the Borrowing or Borrowings to
be paid and shall notify the Administrative Agent by telephone (confirmed by
telecopy) of such selection not later than 11:00 a.m., New York City time, three
Business Days before the scheduled date of such payment; provided that each
--------
payment of Borrowings shall be applied to pay any outstanding ABR Term
Borrowings before any other Borrowings. If the Borrower fails to make a timely
selection of the Borrowing or Borrowings to be repaid or prepaid, such payment
shall be applied, first, to pay any outstanding ABR Term Borrowings and, second,
to other Borrowings in the order of the remaining duration of their respective
Interest Periods (the Borrowing with the shortest remaining Interest Period to
be paid first). Each payment of a Borrowing shall be applied ratably to the
Loans included in such Borrowing.
(c) Maintenance of Loan Accounts by Lenders. Each Lender shall
---------------------------------------
maintain in accordance with its usual practice an account or accounts evidencing
the indebtedness of the
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Borrower to such Lender resulting from each Loan made by such Lender, including
the amounts of principal and interest payable and paid to such Lender from time
to time hereunder.
(d) Maintenance of Loan Accounts by Administrative Agent. The
----------------------------------------------------
Administrative Agent shall maintain accounts in which it shall record (i) the
amount of each Loan made hereunder, the Class and Type thereof (including, in
the case of Incremental Facility Loans, the respective Series thereof) and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder and (iii) the amount of any sum received by the Administrative Agent
hereunder for the account of the Lenders and each Lender's share thereof.
(e) Effect of Loan Accounts. The entries made in the accounts
-----------------------
maintained pursuant to paragraph (c) or (d) of this Section shall be prima facie
----- -----
evidence of the existence and amounts of the obligations recorded therein;
provided that the failure of any Lender or the Administrative Agent to maintain
--------
such accounts or any error therein shall not in any manner affect the obligation
of the Borrower to repay the Loans in accordance with the terms of this
Agreement.
(f) Promissory Notes. Any Lender may request that Loans of any Class
----------------
made by it be evidenced by a promissory note. In such event, the Borrower shall
prepare, execute and deliver to such Lender a promissory note payable to the
order of such Lender (or, if requested by such Lender, to such Lender and its
registered assigns) and in a form approved by the Administrative Agent.
Thereafter, the Loans evidenced by such promissory note and interest thereon
shall at all times (including after assignment pursuant to Section 10.04) be
represented by one or more promissory notes in such form payable to the order of
the payee named therein (or, if such promissory note is a registered note, to
such payee and its registered assigns).
SECTION 2.10. Prepayment of Loans.
-------------------
(a) Optional Prepayments. The Borrower shall have the right at any
--------------------
time and from time to time to prepay any Borrowing in whole or in part, subject
to prior notice in accordance with paragraph (e) of this Section 2.10. Each
prepayment of Term Loans pursuant to this paragraph (a) shall be applied as
follows: first, such prepayment shall be applied to the first installment set
-----
forth in the schedule in Section 2.09(a)(ii) for the calendar year immediately
following the calendar year in which such prepayment occurs and, second, after
------
such first installment shall have been prepaid in full, such prepayment shall be
applied to the remaining installments set forth in said schedule ratably in
accordance with the respective amounts thereof.
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(b) Mandatory Prepayments -- Casualty Events and Sales of Assets.
------------------------------------------------------------
The Borrower shall make prepayments of the Loans (and reduce the Commitments)
hereunder as follows:
(i) Casualty Events. Upon the date twelve months following the
---------------
receipt by the Borrower or any of its Consolidated Subsidiaries of the
proceeds of insurance, condemnation award or other compensation in respect
of any Casualty Event affecting any property of the Borrower or any of its
Consolidated Subsidiaries (or upon such earlier date as the Borrower or
such Consolidated Subsidiary, as the case may be, shall have determined not
to repair or replace the property affected by such Casualty Event), the
Borrower shall prepay the Loans (and/or provide cover for LC Exposure as
specified in Section 2.05(k)), and the Commitments shall be subject to
automatic reduction, in an aggregate amount, if any, equal to 100% of the
Net Cash Proceeds of such Casualty Event not theretofore applied to the
repair or replacement of such property, such prepayment and reduction to be
effected in each case in the manner and to the extent specified in clause
(iii) of this Section 2.10(b).
(ii) Sale of Assets. Without limiting the obligation of the
--------------
Borrower to obtain the consent of the Required Lenders to any Disposition
not otherwise permitted hereunder, the Borrower agrees, on or prior to the
occurrence of any Disposition, to deliver to the Administrative Agent a
statement certified by a Financial Officer, in form and detail reasonably
satisfactory to the Administrative Agent, of the estimated amount of the
Net Cash Proceeds of such Disposition that will (on the date of such
Disposition) be received by the Borrower or any of its Consolidated
Subsidiaries in cash and, unless the Borrower shall elect to reinvest such
Net Cash Proceeds as provided below, the Borrower will prepay the Loans
hereunder (and provide cover for LC Exposure as specified in Section
2.05(k)), and the Commitments hereunder shall be subject to automatic
reduction, as follows:
(x) upon the date of such Disposition, in an aggregate amount
equal to 100% of such estimated amount of the Net Cash Proceeds of
such Disposition, to the extent received by the Borrower or any of its
Consolidated Subsidiaries in cash on the date of such Disposition; and
(y) thereafter, quarterly, on the date of the delivery by the
Borrower to the Administrative Agent pursuant to Section 6.01 of the
financial statements for any quarterly fiscal period or fiscal year,
to the extent the Borrower or any of its Consolidated Subsidiaries
shall receive Net Cash Proceeds during the quarterly fiscal period
ending on the date of such financial statements in cash under deferred
payment arrangements or Disposition Investments entered into or
received in connection with any Disposition, an amount equal to (A)
100% of the aggregate amount of such Net Cash Proceeds minus (B) any
-----
transaction expenses associated with Dispositions and not previously
deducted in the
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determination of Net Cash Proceeds plus (or minus, as the case may be)
---- -----
(C) any other adjustment received or paid by the Borrower or any of
its Consolidated Subsidiaries pursuant to the respective agreements
giving rise to Dispositions and not previously taken into account in
the determination of the Net Cash Proceeds of Dispositions, provided
--------
that if prior to the date upon which the Borrower would otherwise be
required to make a prepayment under this subclause (y) with respect to
any quarterly fiscal period the aggregate amount of such Net Cash
Proceeds (after giving effect to the adjustments provided for in this
subclause (y)) shall exceed $25,000,000, then the Borrower shall
within three Business Days make a prepayment under this subclause (y)
in an amount equal to such required prepayment.
Prepayments of Loans (and cover for LC Exposure) and reductions of
Commitments shall be effected in each case in the manner and to the extent
specified in clause (iii) of this Section 2.10(b).
Notwithstanding the foregoing, the Borrower shall not be required to
make a prepayment (or provide cover), and the Commitments shall not be
reduced, pursuant to this Section 2.10(b)(ii) with respect to the Net Cash
Proceeds from any Disposition in the event that the Borrower advises the
Administrative Agent at the time a prepayment is required to be made under
the foregoing subclauses (x) or (y) that it intends to reinvest such Net
Cash Proceeds into replacement assets pursuant to one or more Capital
Expenditures or Acquisitions permitted hereunder, so long as the Net Cash
Proceeds from any Disposition are in fact so reinvested within 350 days of
such Disposition (it being understood that, in the event more than one
Disposition shall occur, such Net Cash Proceeds shall be deemed to be
applied in the same order in which such Dispositions occurred and,
accordingly, any such Net Cash Proceeds not so reinvested within 350 days
shall be forthwith applied to the prepayment of Loans (and cover for LC
Exposure as specified in Section 2.05(k)) and reductions of Commitments as
provided in clause (iii) of this Section 2.10(b).
Anything herein to the contrary notwithstanding, the Borrower shall
not be required to make any prepayment pursuant to this Section 2.10(b)(ii)
(and the provisions of this Section 2.10(b)(ii) shall accordingly be
inapplicable) to the extent that after giving effect to any Disposition the
Leverage Ratio is less than 4.00 to 1.
(iii) Application. Upon the occurrence of any of the events
-----------
described in the above clauses of this Section 2.10(b), the amount of the
required prepayment shall be applied to the reduction of the Revolving
Commitments and Incremental Facility Commitments of each Series, and to the
prepayment of the Term Loans, in each case ratably in accordance with the
respective then-outstanding aggregate amounts of such Commitments and Loans
(and to the extent that, after giving effect to any such reduction of
Revolving Commitments, the aggregate Revolving Exposure shall exceed
-48-
the Revolving Commitments, to the simultaneous prepayment of Revolving
Loans and/or cover for LC Exposure as specified in Section 2.05(k) and to
the extent that, after giving effect to any such reduction of Incremental
Facility Commitments of any Series, the Incremental Facility Loans of such
Series shall exceed the Incremental Facility Commitments of such Series, to
the simultaneous prepayment of Incremental Facility Loans of such Series),
such reduction of Commitments and prepayments to be applied,
(x) in the case of such prepayment of Term Loans, first to the
-----
prepayment of the first installment set forth in the schedule in
Section 2.09(a)(ii) for the calendar year immediately following the
calendar year in which such prepayment occurs and, second, after such
------
first installment shall have been prepaid in full, to the prepayment
of the remaining installments set forth in said schedule ratably in
accordance with the respective amounts thereof and
(y) in the case of such reduction of Incremental Facility
Commitments of any Series, first, to the reduction of the first
-----
installment set forth in the schedule in Section 2.08(f) for the
calendar year immediately following the calendar year in which such
reduction occurs and, second, after such first installment shall have
------
been reduced in full, to the reduction of the remaining installments
set forth in said schedule ratably in accordance with the respective
amounts thereof.
Notwithstanding the foregoing, to the extent that the aggregate amount of any of
the required prepayments contemplated by this paragraph (b) shall be in excess
of the amount of the ABR Loans of any Class outstanding on the date of such
prepayment, only the portion of the amount of such prepayment of such Class as
is equal to the amount of such ABR Loans shall be immediately prepaid and at the
election of the Borrower, the balance of such required prepayment shall be
either (i) deposited with the Administrative Agent to be held as collateral
security for the Loans of such Class and applied to the prepayment of the
Eurodollar Loans of such Class on the last day(s) of the then next-expiring
Interest Period(s) for Eurodollar Loans in the order in which such Interest
Period(s) shall expire (or immediately if any Event of Default shall occur and
be continuing), or (ii) made immediately, together with any amounts owing to the
Lenders under Section 2.15.
(c) Mandatory Prepayments -- Outstandings Exceeding Commitments. The
-----------------------------------------------------------
Borrower shall prepay the Revolving Loans (and/or provide cover for LC Exposure
as specified in Section 2.05(k)) in the event that the aggregate amount of the
Revolving Exposure shall at any time exceed the aggregate amount of the
Revolving Commitments. In addition, the Borrower shall prepay the Incremental
Facility Loans of any Series in the event that the aggregate amount of the
Incremental Facility Loans of such Series shall at any time exceed the aggregate
amount of the Incremental Facility Commitments of such Series.
-49-
(d) Mandatory Prepayments -- Change of Control. In the event that
------------------------------------------
any "Change of Control" shall occur in respect of the Senior Subordinated Notes,
or any similar event shall occur in respect of any Additional Permitted
Indebtedness, in either case at a time when the aggregate outstanding principal
amount of the respective Indebtedness affected thereby is in excess of
$25,000,000, and as a result thereof the Borrower shall be required to offer to
repurchase, redeem or prepay any portion of the Senior Subordinated Notes or
such Additional Permitted Indebtedness, the Borrower shall prepay the Loans
(and/or provide cover for LC Exposure as specified in Section 2.05(k)), and the
Commitments shall be automatically reduced to zero.
(e) Notices. The Borrower shall notify the Administrative Agent
-------
(and, in the case of prepayment of a Swingline Loan, the respective Swingline
Lender) by telephone (confirmed by telecopy) of any prepayment hereunder (i) in
the case of prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New
York City time, two Business Days before the date of prepayment, (ii) in the
case of prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City
time, one Business Day before the date of prepayment or (iii) in the case of
prepayment of a Swingline Loan, not later than 12:00 noon, New York City time,
on the date of prepayment. Each such notice shall be irrevocable and shall
specify the prepayment date, the principal amount of each Borrowing or portion
thereof to be prepaid and in the case of a mandatory prepayment, a reasonably
detailed calculation of the amount of such prepayment; provided that, if a
--------
notice of prepayment is given in connection with a conditional notice of
termination of the Revolving Commitments as contemplated by Section 2.08, then
such notice of prepayment may be revoked if such notice of termination is
revoked in accordance with Section 2.08. Promptly following receipt of any such
notice relating to a Borrowing, the Administrative Agent shall advise the
Lenders of the contents thereof. Each partial prepayment of any Borrowing shall
be in an amount that would be permitted in the case of a Borrowing of the same
Type as provided in Section 2.02, except as necessary to apply fully the
required amount of a mandatory prepayment. Each prepayment of a Borrowing shall
be applied ratably to the Loans included in the prepaid Borrowing. Prepayments
shall be accompanied by accrued interest to the extent required by Section 2.12.
SECTION 2.11. Fees.
----
(a) Commitment Fee. The Borrower shall pay to the Administrative
--------------
Agent for account of each Lender a commitment fee, which shall accrue at the
Applicable Margin on the daily average unutilized amount of such Lender's
Incremental Facility Commitment and Revolving Commitment (for which purpose the
aggregate amount of any LC Exposure shall be deemed to be a pro rata (based on
the Revolving Commitments) utilization of each Lender's Revolving Commitment and
the aggregate principal amount of any Swingline Loans shall be deemed to be a
utilization of the respective Swingline Lender's Revolving Commitment), for the
period from and including the date hereof to but not including the earlier of
the date such Commitment is terminated and the Maturity Date. Accrued
-50-
commitment fees shall be payable on each Quarterly Date and on the earlier of
the date the relevant Commitments are terminated and the Maturity Date, as the
case may be.
(b) Letter of Credit Fees. The Borrower agrees to pay (i) to the
---------------------
Administrative Agent for the account of each Revolving Lender a participation
fee with respect to its participations in Letters of Credit, which shall accrue
at a rate per annum equal to the Applicable Margin used to determine interest on
Eurodollar Revolving Loans on the average daily amount of such Lender's LC
Exposure (excluding any portion thereof attributable to unreimbursed LC
Disbursements) during the period from and including the Effective Date to but
excluding the later of the date on which such Lender's Revolving Commitment
terminates and the date on which such Lender ceases to have any LC Exposure, and
(ii) to the Issuing Lender a fronting fee, which shall accrue at the rate of
3/16 of 1% per annum on the average daily amount of the LC Exposure (excluding
any portion thereof attributable to unreimbursed LC Disbursements) during the
period from and including the Effective Date to but excluding the later of the
date of termination of the Revolving Commitments and the date on which there
ceases to be any LC Exposure, as well as the Issuing Lender's standard fees with
respect to the issuance, amendment, renewal or extension of any Letter of Credit
or processing of drawings thereunder. Participation fees and fronting fees
accrued through and including each Quarterly Date shall be payable on the third
Business Day following such Quarterly Date, commencing on the first such date to
occur after the Effective Date; provided that all such fees shall be payable on
--------
the date on which the Revolving Commitments terminate and any such fees accruing
after the date on which the Revolving Commitments terminate shall be payable on
demand. Any other fees payable to the Issuing Lender pursuant to this paragraph
shall be payable within 10 days after demand. All participation fees and
fronting fees shall be computed on the basis of a year of 360 days and shall be
payable for the actual number of days elapsed (including the first day but
excluding the last day).
(c) Administrative Agent Fees. The Borrower agrees to pay to the
-------------------------
Administrative Agent, for its own account, fees payable in the amounts and at
the times separately agreed upon between the Borrower and the Administrative
Agent (it being understood that if the Administrative Agent shall resign or be
removed, a ratable portion of any fees theretofore paid to the Administrative
Agent for the period during which such resignation or removal shall occur shall
be promptly paid by the Administrative Agent to the Borrower to the extent the
Borrower is required to pay fees for the balance of such period to a replacement
Administrative Agent).
(d) Payment of Fees. All fees payable hereunder shall be paid on the
---------------
dates due, in immediately available funds, to the Administrative Agent (or to
the Issuing Lender, in the case of fees payable to it) for distribution, in the
case of commitment fees and participation fees, to the Lenders entitled thereto.
Except as otherwise expressly provided in paragraph (c) above, fees paid shall
not be refundable under any circumstances.
-51-
SECTION 2.12. Interest.
--------
(a) ABR Borrowings. The Loans comprising each ABR Borrowing (other
--------------
than Swingline Loans, as to which paragraph (c) below shall apply) shall bear
interest at a rate per annum equal to the Alternate Base Rate plus the
Applicable Margin.
(b) Eurodollar Borrowings. The Loans comprising each Eurodollar
---------------------
Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBO
Rate for the Interest Period in effect for such Borrowing plus the Applicable
Margin.
(c) Swingline Borrowings. Each Swingline Loan shall bear interest at
--------------------
a rate per annum equal to the Alternative Base Rate plus the Applicable Margin,
or at such alternate rate of interest as may be applicable thereto as
contemplated by Section 2.04(b).
(d) Default Interest. Notwithstanding the foregoing, if any
----------------
principal of or interest on any Loan or any fee or other amount payable by the
Borrower hereunder is not paid when due, whether at stated maturity, upon
acceleration, by mandatory prepayment or otherwise, such overdue amount (or, in
case the amount in default is principal of a Loan, all amounts outstanding
hereunder) shall bear interest, after as well as before judgment, at a rate per
annum equal to (i) in the case of overdue principal of any Loan, 2% plus the
----
rate otherwise applicable to such Loan as provided above or (ii) in the case of
any other amount, 2% plus the rate applicable to ABR Loans as provided in
----
paragraph (a) of this Section.
(e) Payment of Interest. Accrued interest on each Loan shall be
-------------------
payable in arrears on each Interest Payment Date for such Loan and, in the case
of Revolving Loans, upon termination of the Revolving Commitments; provided that
--------
(i) interest accrued pursuant to paragraph (d) of this Section shall be payable
on demand, (ii) in the event of any repayment or prepayment of any Loan (other
than a prepayment of an ABR Revolving Loan prior to the Maturity Date), accrued
interest on the principal amount repaid or prepaid shall be payable on the date
of such repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Borrowing prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.
(f) Computation. All interest hereunder shall be computed on the
-----------
basis of a year of 360 days, except that interest computed by reference to the
Alternate Base Rate at times when the Alternate Base Rate is based on the Prime
Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). The applicable Alternate
Base Rate or Adjusted LIBO Rate shall be determined by the Administrative Agent,
and such determination shall be conclusive absent manifest error.
SECTION 2.13. Alternate Rate of Interest. If prior to the
--------------------------
commencement of any Interest Period for a Eurodollar Borrowing:
-52-
(a) the Administrative Agent determines (which determination shall be
conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBO Rate for such Interest Period; or
(b) if such Borrowing is of a particular Class of Loans (including of
a particular Series of Incremental Facility Loans), the Administrative
Agent is advised by the Required Revolving Lenders, Required Term Lenders
or Required Incremental Facility Lenders of such Series, as the case may
be, that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period will not adequately and fairly reflect the cost to such
Lenders of making or maintaining their Loans of such Class included in such
Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing, provided that a Lender and the
--------
Borrower may agree that, in lieu of the interest rate on such affected Borrowing
being calculated by reference to the Alternative Base Rate while such
circumstances shall continue, such interest rate shall instead be at an
alternative rate of interest (and with such applicable margins and prepayment
premiums) as may from time to time be offered by such Lender to the Borrower in
its sole discretion.
SECTION 2.14. Increased Costs.
---------------
(a) Increased Costs Generally. If any Change in Law shall:
-------------------------
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender (except any such reserve
requirement reflected in the Adjusted LIBO Rate) or the Issuing Lender; or
(ii) impose on any Lender or the Issuing Lender or the London
interbank market any other condition affecting this Agreement or Eurodollar
Loans made by such Lender or any Letter of Credit or participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lenders of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
Issuing Lender of participating in, issuing or maintaining any Letter of Credit
or to reduce the amount of any sum received or receivable by such Lender or the
Issuing Lender hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or the Issuing Lender, as the case may be, such
-53-
additional amount or amounts as will compensate such Lender or the Issuing
Lender, as the case may be, for such additional costs incurred or reduction
suffered.
(b) Capital Requirements. If any Lender or the Issuing Lender
--------------------
determines that any Change in Law regarding capital requirements has or would
have the effect of reducing the rate of return on such Lender's or the Issuing
Lender's capital or on the capital of such Lender's or the Issuing Lender's
holding company, if any, as a consequence of this Agreement or the Loans made
by, or participations in Letters of Credit held by, such Lender, or the Letters
of Credit issued by the Issuing Lender, to a level below that which such Lender
or the Issuing Lender or such Lender's or the Issuing Lender's holding company
could have achieved but for such Change in Law (taking into consideration such
Lender's or the Issuing Lender's policies and the policies of such Lender's or
the Issuing Lender's holding company with respect to capital adequacy), then
from time to time the Borrower will pay to such Lender or the Issuing Lender, as
the case may be, such additional amount or amounts as will compensate such
Lender or the Issuing Lender or such Lender's or the Issuing Lender's holding
company for any such reduction suffered.
(c) Certificates from Lenders. A certificate of a Lender or the
-------------------------
Issuing Lender setting forth the amount or amounts necessary to compensate such
Lender or the Issuing Lender or its holding company, as the case may be, as
specified in paragraph (a) or (b) of this Section, and setting forth in
reasonable detail the manner in which such amount or amounts have been
determined, shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender or the Issuing Lender, as
the case may be, the amount shown as due on any such certificate within 10 days
after receipt thereof.
(d) Delay in Requests. Failure or delay on the part of any Lender or
-----------------
the Issuing Lender to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender's or the Issuing Lender's right to demand
such compensation; provided that the Borrower shall not be required to
--------
compensate a Lender or the Issuing Lender pursuant to this Section for any
increased costs or reductions incurred more than six months prior to the date
that such Lender or the Issuing Lender, as the case may be, notifies the
Borrower of the Change in Law giving rise to such increased costs or reductions
and of such Lender's or the Issuing Lender's intention to claim compensation
therefor; provided further that, if the Change in Law giving rise to such
-------- -------
increased costs or reductions is retroactive, then the six-month period referred
to above shall be extended to include the period of retroactive effect thereof.
SECTION 2.15. Break Funding Payments. In the event of (a) the
----------------------
payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice is permitted to be revocable
under Section 2.10(b) and is revoked in accordance herewith), or (d) the
assignment of any
-54-
Eurodollar Loan other than on the last day of the Interest Period applicable
thereto as a result of a request by the Borrower pursuant to Section 2.18, then,
in any such event, the Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. In the case of a Eurodollar Loan, the
loss to any Lender attributable to any such event shall be deemed to include an
amount determined by such Lender to be equal to the excess, if any, of (i) the
amount of interest that such Lender would pay for a deposit equal to the
principal amount of such Loan for the period from the date of such payment,
conversion, failure or assignment to the last day of the then current Interest
Period for such Loan (or, in the case of a failure to borrow, convert or
continue, the duration of the Interest Period that would have resulted from such
borrowing, conversion or continuation) if the interest rate payable on such
deposit were equal to the Adjusted LIBO Rate for such Interest Period, over (ii)
the amount of interest that such Lender would earn on such principal amount for
such period if such Lender were to invest such principal amount for such period
at the interest rate that would be bid by such Lender (or an affiliate of such
Lender) for dollar deposits from other banks in the eurodollar market at the
commencement of such period. A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 10 days after receipt thereof.
SECTION 2.16. Taxes.
-----
(a) Payments Free of Taxes. Any and all payments by or an account of
----------------------
any obligation of the Borrower hereunder or under any other Loan Document shall
be made free and clear of and without deduction for any Indemnified Taxes or
Other Taxes; provided that if the Borrower shall be required to deduct any
--------
Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable
shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, Lender or Issuing Lender (as the case may be) receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall
pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.
(b) Payment of Other Taxes by Borrower. In addition, the Borrower
----------------------------------
shall pay any Other Taxes to the relevant Governmental Authority in accordance
with applicable law.
(c) Indemnification by Borrower. The Borrower shall indemnify the
---------------------------
Administrative Agent, each Lender and the Issuing Lender, within 10 days after
written demand therefor, for the full amount of any Indemnified Taxes or Other
Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) paid by the Administrative
Agent, such Lender or the Issuing Lender, as the case may be, and any penalties,
interest and reasonable expenses arising therefrom or with respect thereto,
whether or not such Indemnified Taxes or Other Taxes were correctly or
-55-
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender or the Issuing Lender, or by the Administrative Agent on
its own behalf or on behalf of a Lender or the Issuing Lender, shall be
conclusive absent manifest error.
(d) Receipt for Payments. As soon as practicable after any payment
--------------------
of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority,
the Borrower shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.
(e) Foreign Lenders. Any Foreign Lender that is entitled to an
---------------
exemption from or reduction of withholding tax under the law of the jurisdiction
in which the Borrower is located, or any treaty to which such jurisdiction is a
party, with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law or reasonably requested by the Borrower, such
properly completed and executed documentation prescribed by applicable law as
will permit such payments to be made without withholding or at a reduced rate.
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-
------------------------------------------------------
offs.
----
(a) Payments by Obligors. Each Obligor shall make each payment
--------------------
required to be made by it hereunder (whether of principal, interest, fees or
reimbursement of LC Disbursements, or under Section 2.14, 2.15 or 2.16, or
otherwise) or under any other Loan Document (except to the extent otherwise
provided therein) prior to 12:00 noon, New York City time, on the date when due,
in immediately available funds, without set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx, except as otherwise expressly provided in the relevant Loan
Document, and except payments to be made directly to the Issuing Lender or a
Swingline Lender as expressly provided herein and except that payments pursuant
to Sections 2.14, 2.15, 2.16 and 10.03 shall be made directly to the Persons
entitled thereto. The Administrative Agent shall distribute any such payments
received by it for the account of any other Person to the appropriate recipient
promptly following receipt thereof. If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension. All
payments hereunder or under any other Loan Document (except to the extent
otherwise provided therein) shall be made in dollars.
-56-
(b) Application if Payments Insufficient. If at any time
------------------------------------
insufficient funds are received by and available to the Administrative Agent to
pay fully all amounts of principal, unreimbursed LC Disbursements, interest and
fees then due hereunder, then such funds as shall actually have been received
shall be applied (i) first, to pay interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (ii) second, to pay principal and
unreimbursed LC Disbursements then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and unreimbursed LC
Disbursements then due to such parties.
(c) Pro Rata Treatment. Except to the extent otherwise provided
------------------
herein: (i) each borrowing of Loans of a particular Class (including of a
particular Series of Incremental Facility Loans) from the Lenders under Section
2.01 shall be made from the relevant Lenders, each payment of commitment fee
under Section 2.11 in respect of Commitments of a particular Class (including of
a particular Series of Incremental Facility Loans) shall be made for account of
the relevant Lenders, and each termination or reduction of the amount of the
Commitments of a particular Class (including of a particular Incremental
Facility of Term Loans) under Section 2.08 shall be applied to the respective
Commitments of such Class of the relevant Lenders, pro rata according to the
amounts of their respective Commitments of such Class; (ii) Eurodollar Loans of
any Class (including of a particular Series of Incremental Facility Loans)
having the same Interest Period shall be allocated pro rata among the relevant
Lenders according to the amounts of their Commitments or such Class (in the case
of the making of Loans) or their respective Loans of such Class (in the case of
conversions and continuations of Loans); (iii) each payment or prepayment by the
Borrower of principal of Loans of a particular Class (including of a particular
Series of Incremental Facility Loans) shall be made for account of the relevant
Lenders pro rata in accordance with the respective unpaid principal amounts of
the Loans of such Class held by them; (iv) each payment by the Borrower of
interest on Loans of a particular Class (including of a particular Series of
Incremental Facility Loans) shall be made for account of the relevant Lenders
pro rata in accordance with the amounts of interest on such Loans then due and
payable to the respective Lenders; and (v) each payment by the Borrower of
participation fees in respect of Letters of Credit shall be made for the account
of the Revolving Lenders pro rata in accordance with the amount of participation
fees then due and payable to the Revolving Lenders.
(d) Sharing of Payments by Lenders. If any Lender shall, by
------------------------------
exercising any right of set-off or counterclaim or otherwise, obtain payment in
respect of any principal of or interest on any of its Loans or participations in
LC Disbursements or Swingline Loans resulting in such Lender receiving payment
of a greater proportion of the aggregate amount of its Loans and participations
in LC Disbursements and Swingline Loans and accrued interest thereon then due
than the proportion received by any other Lender, then the Lender receiving such
greater proportion shall purchase (for cash at face value) participations in the
Loans and participations in LC Disbursements and Swingline Loans of other
Lenders to the extent
-57-
necessary so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and participations in LC
Disbursements and Swingline Loans; provided that (i) if any such participations
--------
are purchased and all or any portion of the payment giving rise thereto is
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment made
by any Obligor pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in LC Disbursements to any assignee or participant, other than to the Borrower
or any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). Each Obligor consents to the foregoing and agrees, to
the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against such Obligor rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of such Obligor
in the amount of such participation.
(e) Presumptions of Payment. Unless the Administrative Agent shall
-----------------------
have received notice from the Borrower prior to the date on which any payment is
due to the Administrative Agent for the account of the Lenders or the Issuing
Lender hereunder that the Borrower will not make such payment, the
Administrative Agent may assume that the Borrower has made such payment on such
date in accordance herewith and may, in reliance upon such assumption,
distribute to the Lenders or the Issuing Lender, as the case may be, the amount
due. In such event, if the Borrower has not in fact made such payment, then
each of the Lenders or the Issuing Lender, as the case may be, severally agrees
to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender or the Issuing Lender with interest thereon, for each
day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the Federal Funds
Effective Rate.
(f) Certain Deductions by Administrative Agent. If any Lender shall
------------------------------------------
fail to make any payment required to be made by it pursuant to Section 2.04(c),
2.05(e) or (f), 2.06(b) or 2.17(e), then the Administrative Agent may, in its
discretion (notwithstanding any contrary provision hereof), apply any amounts
thereafter received by the Administrative Agent for the account of such Lender
to satisfy such Lender's obligations under such Sections until all such
unsatisfied obligations are fully paid.
SECTION 2.18. Mitigation Obligations; Replacement of Lenders.
----------------------------------------------
(a) Designation of Different Lending Office. If any Lender requests
---------------------------------------
compensation under Section 2.14, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 2.16, then such Lender shall, at Borrower's
request, use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its
-58-
rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the good faith judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section
2.14 or 2.16, as the case may be, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any such
designation or assignment.
(b) Replacement of Lenders. If any Lender requests compensation
----------------------
under Section 2.14, or if the Borrower is required to pay any additional amount
to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 2.16, or if any Lender defaults in its obligation to fund
Loans hereunder, then the Borrower may, at its sole expense and effort, upon
notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in Section 10.04), all its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the prior
--------
written consent of the Administrative Agent (and, if a Revolving Commitment is
being assigned, the Issuing Lender and each Swingline Lender), which consent
shall not unreasonably be withheld, (ii) such Lender shall have received payment
of an amount equal to the outstanding principal of its Loans and participations
in LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder, from the assignee (to the extent
of such outstanding principal and accrued interest and fees) or the Borrower (in
the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.14 or payments required
to be made pursuant to Section 2.16, such assignment will result in a reduction
in such compensation or payments. A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.
ARTICLE III
GUARANTEE
SECTION 3.01. The Guarantee. The Subsidiary Guarantors hereby
-------------
jointly and severally guarantee to each Lender and the Administrative Agent and
their respective successors and assigns the prompt payment in full when due
(whether at stated maturity, by acceleration or otherwise) of the principal of
and interest on the Loans made by the Lenders to the Borrower and all other
amounts from time to time owing to the Lenders or the Administrative Agent by
the Borrower under this Agreement and by any Obligor under any of the other Loan
Documents, and all obligations of the Borrower or any of its Subsidiaries to any
Lender in respect of any Hedging Agreement, in each case strictly in accordance
with the
-59-
terms thereof (such obligations being herein collectively called the "Guaranteed
----------
Obligations"). The Subsidiary Guarantors hereby further jointly and severally
-----------
agree that if the Borrower shall fail to pay in full when due (whether at stated
maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the
Subsidiary Guarantors will promptly pay the same, without any demand or notice
whatsoever, and that in the case of any extension of time of payment or renewal
of any of the Guaranteed Obligations, the same will be promptly paid in full
when due (whether at extended maturity, by acceleration or otherwise) in
accordance with the terms of such extension or renewal.
SECTION 3.02. Obligations Unconditional. The obligations of the
-------------------------
Subsidiary Guarantors under Section 3.01 are absolute and unconditional, joint
and several, irrespective of the value, genuineness, validity, regularity or
enforceability of the obligations of the Borrower under this Agreement or any
other agreement or instrument referred to herein or therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this Section that the obligations of the
Subsidiary Guarantors hereunder shall be absolute and unconditional, joint and
several, under any and all circumstances. Without limiting the generality of
the foregoing, it is agreed that the occurrence of any one or more of the
following shall not alter or impair the liability of the Subsidiary Guarantors
hereunder, which shall remain absolute and unconditional as described above:
(i) at any time or from time to time, without notice to the
Subsidiary Guarantors, the time for any performance of or compliance with
any of the Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of this
Agreement or any other agreement or instrument referred to herein shall be
done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under this Agreement
or any other agreement or instrument referred to herein shall be waived or
any other guarantee of any of the Guaranteed Obligations or any security
therefor shall be released or exchanged in whole or in part or otherwise
dealt with; or
(iv) any lien or security interest granted to, or in favor of,
the Administrative Agent or any Lender or Lenders as security for any of
the Guaranteed Obligations shall fail to be perfected.
The Subsidiary Guarantors hereby expressly waive diligence, presentment, demand
of payment, protest and all notices whatsoever, and any requirement that the
Administrative Agent or any Lender exhaust any right, power or remedy or proceed
against the Borrower
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under this Agreement or any other agreement or instrument referred to herein, or
against any other Person under any other guarantee of, or security for, any of
the Guaranteed Obligations.
SECTION 3.03. Reinstatement. The obligations of the Subsidiary
-------------
Guarantors under this Article shall be automatically reinstated if and to the
extent that for any reason any payment by or on behalf of the Borrower in
respect of the Guaranteed Obligations is rescinded or must be otherwise restored
by any holder of any of the Guaranteed Obligations, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise, and the Subsidiary
Guarantors jointly and severally agree that they will indemnify the
Administrative Agent and each Lender on demand for all reasonable costs and
expenses (including fees of counsel) incurred by the Administrative Agent or
such Lender in connection with such rescission or restoration, including any
such costs and expenses incurred in defending against any claim alleging that
such payment constituted a preference, fraudulent transfer or similar payment
under any bankruptcy, insolvency or similar law.
SECTION 3.04. Subrogation. Each Subsidiary Guarantor hereby waives
-----------
all rights of subrogation or contribution, whether arising by contract or
operation of law (including any such right arising under the Bankruptcy Code) or
otherwise by reason of any payment by it pursuant to the provisions of this
Article and further agrees with the Borrower for the benefit of each of its
creditors (including each Lender and the Administrative Agent) that any such
payment by it shall constitute a contribution of capital by such Subsidiary
Guarantor to the Borrower (or an investment in the equity capital of the
Borrower by such Subsidiary Guarantor).
SECTION 3.05. Remedies. The Subsidiary Guarantors jointly and
--------
severally agree that, as between the Subsidiary Guarantors and the Lenders, the
obligations of the Borrower under this Agreement may be declared to be forthwith
due and payable as provided in Article VIII (and shall be deemed to have become
automatically due and payable in the circumstances provided in Article VIII) for
purposes of Section 3.01 notwithstanding any stay, injunction or other
prohibition preventing such declaration (or such obligations from becoming
automatically due and payable) as against the Borrower and that, in the event of
such declaration (or such obligations being deemed to have become automatically
due and payable), such obligations (whether or not due and payable by the
Borrower) shall forthwith become due and payable by the Subsidiary Guarantors
for purposes of Section 3.01.
SECTION 3.06. Instrument for the Payment of Money. Each Subsidiary
-----------------------------------
Guarantor hereby acknowledges that the guarantee in this Article constitutes an
instrument for the payment of money, and consents and agrees that any Lender or
the Administrative Agent, at its sole option, in the event of a dispute by such
Subsidiary Guarantor in the payment of any moneys due hereunder, shall have the
right to bring motion-action under New York CPLR Section 3213.
SECTION 3.07. Continuing Guarantee. The guarantee in this Article is
--------------------
a continuing guarantee, and shall apply to all Guaranteed Obligations whenever
arising.
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SECTION 3.08. Rights of Contribution. The Subsidiary Guarantors
----------------------
hereby agree, as between themselves, that if any Subsidiary Guarantor shall
become an Excess Funding Guarantor (as defined below) by reason of the payment
by such Subsidiary Guarantor of any Guaranteed Obligations, each other
Subsidiary Guarantor shall, on demand of such Excess Funding Guarantor (but
subject to the next sentence), pay to such Excess Funding Guarantor an amount
equal to such Subsidiary Guarantor's Pro Rata Share (as defined below and
determined, for this purpose, without reference to the properties, debts and
liabilities of such Excess Funding Guarantor) of the Excess Payment (as defined
below) in respect of such Guaranteed Obligations. The payment obligation of a
Subsidiary Guarantor to any Excess Funding Guarantor under this Section shall be
subordinate and subject in right of payment to the prior payment in full of the
obligations of such Subsidiary Guarantor under the other provisions of this
Article and such Excess Funding Guarantor shall not exercise any right or remedy
with respect to such excess until payment and satisfaction in full of all of
such obligations.
For purposes of this Section, (i) "Excess Funding Guarantor" means, in
------------------------
respect of any Guaranteed Obligations, a Subsidiary Guarantor that has paid an
amount in excess of its Pro Rata Share of such Guaranteed Obligations, (ii)
"Excess Payment" means, in respect of any Guaranteed Obligations, the amount
---------------
paid by an Excess Funding Guarantor in excess of its Pro Rata Share of such
Guaranteed Obligations and (iii) "Pro Rata Share" means, for any Subsidiary
--------------
Guarantor, the ratio (expressed as a percentage) of (x) the amount by which the
aggregate present fair saleable value of all properties of such Subsidiary
Guarantor (excluding any shares of stock of any other Subsidiary Guarantor)
exceeds the amount of all the debts and liabilities of such Subsidiary Guarantor
(including contingent, subordinated, unmatured and unliquidated liabilities, but
excluding the obligations of such Subsidiary Guarantor hereunder and any
obligations of any other Subsidiary Guarantor that have been Guaranteed by such
Subsidiary Guarantor) to (y) the amount by which the aggregate fair saleable
value of all properties of all of the Subsidiary Guarantors exceeds the amount
of all the debts and liabilities (including contingent, subordinated, unmatured
and unliquidated liabilities, but excluding the obligations of the Borrower and
the Subsidiary Guarantors hereunder and under the other Loan Documents) of all
of the Subsidiary Guarantors, determined (A) with respect to any Subsidiary
Guarantor that is a party hereto on the Effective Date, as of the Effective
Date, and (B) with respect to any other Subsidiary Guarantor, as of the date
such Subsidiary Guarantor becomes a Subsidiary Guarantor hereunder.
SECTION 3.09. General Limitation on Guarantee Obligations. In any
-------------------------------------------
action or proceeding involving any state corporate law, or any state or Federal
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Subsidiary Guarantor under
Section 3.01 would otherwise, taking into account the provisions of Section
3.08, be held or determined to be void, invalid or unenforceable, or
subordinated to the claims of any other creditors, on account of the amount of
its liability under Section 3.01, then, notwithstanding any other provision
hereof to the contrary, the amount of such liability shall, without any further
action by such Subsidiary Guarantor, any Lender, the Administrative Agent or any
other Person, be automatically
-62-
limited and reduced to the highest amount that is valid and enforceable and not
subordinated to the claims of other creditors as determined in such action or
proceeding.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
SECTION 4.01. Organization; Powers. Each of the Borrower and its
--------------------
Consolidated Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, has all
requisite power and authority to carry on its business as now conducted and,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, is qualified to
do business in, and is in good standing in, every jurisdiction where such
qualification is required.
SECTION 4.02. Authorization; Enforceability. The Transactions are
-----------------------------
within each Obligor's corporate powers and have been duly authorized by all
necessary corporate and, if required, stockholder action. This Agreement has
been duly executed and delivered by each Obligor and constitutes, and each of
the other Basic Documents to which it is a party when executed and delivered by
such Obligor and the other parties thereto will constitute, a legal, valid and
binding obligation of such Obligor, enforceable against each Obligor in
accordance with its terms, except as such enforceability may be limited by (a)
bankruptcy, insolvency, reorganization, moratorium or similar laws of general
applicability affecting the enforcement of creditors' rights and (b) the
application of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
SECTION 4.03. Governmental Approvals; No Conflicts. The Transactions
------------------------------------
(a) do not require any material consent or approval of, registration or filing
with, or any other action by, any Governmental Authority, except such as have
been obtained or made and are in full force and effect, (b) will not violate any
applicable law or regulation or the charter, by-laws or other organizational
documents of the Borrower or any of its Consolidated Subsidiaries or any order
of any Governmental Authority, (c) will not violate or result in a default under
any indenture, agreement or other instrument binding upon the Borrower or any of
its Consolidated Subsidiaries or assets, or give rise to a right thereunder to
require any payment to be made by any such Person (other than that an offer to
repurchase the Senior Subordinated Notes shall be made as provided in the
Indenture with respect thereto as a result of the Merger Transactions and other
than consents required with respect to the Merger Transactions under leases and
other contracts, but not including any agreement relating to any Indebtedness,
entered into in the ordinary course of business and as to which the failure to
obtain such consent, individually or in the aggregate, could not reasonably be
expected to
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result in a Material Adverse Effect) and (d) will not result in the creation or
imposition of any Lien on any asset of the Borrower or any of its Consolidated
Subsidiaries.
SECTION 4.04. Financial Condition; No Material Adverse Change.
-----------------------------------------------
(a) The Borrower has heretofore delivered, or made available, to the
Lenders the following financial statements as set forth in the Registration
Statement:
(i) the audited consolidated balance sheet and related
statements of operations, stockholders' equity and cash flows of the
Borrower and its Subsidiaries as of and for the fiscal years ended December
31, 1995 and December 31, 1996, respectively, reported on by Ernst & Young
LLP, independent public accountants;
(ii) the unaudited condensed consolidated balance sheet and
related statements of operations, stockholders' equity and cash flows of
the Borrower and its Subsidiaries as of and for the three-month period
ended March 31, 1997;
(iii) the respective financial statements of Northstar
Television of Grand Rapids, Inc., Northstar Television of Xxxxxxx, Inc. and
Northstar Television of Providence, Inc, of Multimedia Entertainment, Inc.
(d.b.a. WLWT-TV) and of Selected Gannett Television Stations, in each case
as set forth in the Registration Statement;
(iv) the audited combined balance sheets and related statements
of operations and cash flows of the Hearst Broadcast Group of Hearst as of
and for the fiscal years ended December 31, 1995 and December 31, 1996,
respectively, reported on by Deloitte & Touche LLP, independent public
accountants;
(v) the unaudited combined balance sheets and related
statements of operations and cash flows of the Hearst Broadcast Group of
Hearst as of and for the three-month period ended March 31, 1997; and
(vi) the unaudited pro forma combined condensed balance sheet
and the related statements of operations for the fiscal year ended December
31, 1996, prepared under the assumption that the Merger Transactions had
occurred at the beginning of such fiscal year.
Such financial statements present fairly, in all material respects, the actual
or pro forma (as the case may be) financial position and the actual or pro forma
(as the case may be) results of operations and cash flows of the respective
entities as of such dates and for such periods in accordance with GAAP, subject
to year-end audit adjustments and the absence of footnotes in the case of the
statements referred to in clauses (ii), (iv) and (v) above.
(b) Since December 31, 1996, there has been no material adverse
change in the business, condition (financial or otherwise), operations,
properties or prospects (excluding
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adverse changes to prospects as a result of changes affecting the television
broadcasting industry generally) of the Borrower and its Subsidiaries, taken as
a whole, and during the period since December 31, 1996 and prior to the
Effective Date, there has been no material adverse change in the business,
condition (financial or otherwise), operations, properties or prospects
(excluding adverse changes to prospects as a result of changes affecting the
television broadcasting industry generally) of the Hearst Broadcast Group of
Hearst, taken as a whole.
SECTION 4.05. Properties.
----------
(a) Each of the Borrower and its Consolidated Subsidiaries has (and,
after giving effect to the Merger Transactions, will have) good title to, or
valid leasehold interests in, all its real and personal property material to its
business, subject only to Liens permitted by Section 7.02 and except for minor
defects in title or interests that do not interfere with their ability to
conduct their business as currently conducted or to utilize such properties for
their intended purposes.
(b) Each of the Borrower and its Consolidated Subsidiaries owns or is
licensed to use (and, after giving effect to the Merger Transactions, will own
or be licensed to use) all trademarks, tradenames, copyrights, patents and other
intellectual property material to its business, and the use thereof by the
Borrower and its Consolidated Subsidiaries does not (and, after giving effect to
the Merger Transactions, will not) infringe upon the rights of any other Person,
except for any such infringements that, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.
SECTION 4.06. Litigation and Environmental Matters.
------------------------------------
(a) There are no actions, suits or proceedings by or before any
arbitrator or Governmental Authority now pending against or, to the knowledge of
the Borrower, threatened against or affecting the Borrower or any of its
Consolidated Subsidiaries (or that will, after giving effect to the Merger
Transactions, affect the Borrower or any of its Consolidated Subsidiaries) (i)
as to which there is a reasonable likelihood of an adverse determination and
that, if adversely determined, could reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters) or (ii) that involve this Agreement or the Transactions (other than the
possible assertion of statutory dissenters' rights described in the Registration
Statement).
(b) Except for the Disclosed Matters and except with respect to any
other matters that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, neither the Borrower nor any of
its Consolidated Subsidiaries (i) has failed (or, after giving effect to the
Merger Transactions, will have failed) to comply with any Environmental Law or
to obtain, maintain or comply with any permit, license or other approval
required under any Environmental Law, (ii) has become (or, after giving effect
to the Merger Transactions, will have become) subject to any Environmental
Liability, (iii) has
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received (or, after giving effect to the Merger Transactions, will have
received) notice of any claim with respect to any Environmental Liability or
(iv) knows of any basis for any Environmental Liability.
(c) Since the date of this Agreement, there has been no change in the
status of the Disclosed Matters that, individually or in the aggregate, has
resulted in, or could reasonably be expected to result in, a Material Adverse
Effect.
SECTION 4.07. Compliance with Laws and Agreements. Each of the
-----------------------------------
Borrower and its Consolidated Subsidiaries is (and, after giving effect to the
Merger Transactions, will be) in compliance with all laws, regulations and
orders of any Governmental Authority applicable to it or its property and all
indentures, agreements and other instruments binding upon it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. No Default has
occurred and is continuing.
SECTION 4.08. Investment and Holding Company Status. Neither the
-------------------------------------
Borrower nor any of its Subsidiaries is (a) an "investment company" as defined
in, or subject to regulation under, the Investment Company Act of 1940 or (b) a
"holding company" as defined in, or subject to regulation under, the Public
Utility Holding Company Act of 1935.
SECTION 4.09. Taxes. Effective as of the close of business on the
-----
Effective Date, the Borrower and its Subsidiaries will be members of an
affiliated group of corporations filing consolidated returns for Federal income
tax purposes, of which Hearst is the "common parent" (within the meaning of
Section 1504 of the Code) of such group. There is no tax sharing, tax
allocation or similar agreement (other than the Tax Sharing Agreement) to which
the Borrower or any of its Subsidiaries is subject that is currently in effect
providing for the manner in which tax payments owing by the members of such
affiliated group (whether in respect of Federal, state or foreign income or
other taxes) are allocated among the members of the group. The Borrower has
filed (either directly or indirectly through Hearst) all Tax returns and reports
required to have been filed and has paid (either directly or indirectly through
Hearst) all Taxes required to have been paid by it, except (a) Taxes that are
being contested in good faith by appropriate proceedings and for which such
Person has set aside on its books adequate reserves or (b) to the extent that
the failure to do so could not reasonably be expected to result in a Material
Adverse Effect.
SECTION 4.10. ERISA. No ERISA Event has occurred or is reasonably
-----
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed the fair
market value of the assets of such Plan, and the present value of all
accumulated benefit obligations of all underfunded Plans (based on the
assumptions used for
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purposes of Statement of Financial Accounting Standards No. 87) did not, as of
the date of the most recent financial statements reflecting such amounts, exceed
the fair market value of the assets of all such underfunded Plans, in either
case by an amount that could reasonably be expected to result in a Material
Adverse Effect.
SECTION 4.11. Disclosure. The Borrower has disclosed to the Lenders
----------
(i) all agreements, instruments and corporate or other restrictions to which it
or any of its Consolidated Subsidiaries is (or, after giving effect to the
Merger Transactions, will be) subject, and (ii) all other matters known to it,
that, in the case of either of the foregoing clauses (i) or (ii), individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect. None of the reports, financial statements, certificates or
other written information (including the Information Memorandum) furnished by or
on behalf of the Obligors to the Lender in connection with the negotiation of
this Agreement and the other Loan Documents or delivered hereunder or thereunder
(as modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, when taken as a whole, in the light of the
circumstances under which they were made, not misleading; provided that, with
--------
respect to projected financial information, the Borrower represents only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time in light of circumstances in effect on the date
prepared, it being understood that such projections do not constitute a
representation or warranty as to the future performance of the Borrower and that
actual results may vary from such projections.
SECTION 4.12. Use of Credit. Neither the Borrower nor any of its
-------------
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose, whether immediate, incidental
or ultimate, of buying or carrying Margin Stock, and no part of the proceeds of
any extension of credit hereunder will be used to buy or carry any Margin Stock.
SECTION 4.13. Material Agreements and Liens With Respect to
---------------------------------------------
Indebtedness.
------------
(a) Part A of Schedule II is a complete and correct list of each
credit agreement, loan agreement, indenture, purchase agreement, guarantee,
letter of credit or other arrangement providing for or otherwise relating to any
Indebtedness or any extension of credit (or commitment for any extension of
credit) to, or guarantee by, the Borrower or any of its Consolidated
Subsidiaries outstanding on the date hereof (or that will be outstanding on the
Effective Date after giving effect to the Merger Transactions) the aggregate
principal or face amount of which equals or exceeds (or may equal or exceed)
$10,000,000, and the aggregate principal or face amount outstanding or that may
become outstanding under each such arrangement is correctly described in Part A
of Schedule II.
(b) Part B of Schedule II is a complete and correct list of each Lien
securing Indebtedness of any Person outstanding on the date hereof (or that will
be outstanding on the Effective Date after giving effect to the Merger
Transactions) the aggregate principal or face
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amount of which equals or exceeds (or may equal or exceed) $10,000,000 and
covering any property of the Borrower or any of its Consolidated Subsidiaries,
and the aggregate Indebtedness secured (or that may be secured) by each such
Lien and the property covered by each such Lien is correctly described in Part B
of Schedule II.
SECTION 4.14. Capitalization. On the Effective Date (after giving
--------------
effect to the Merger Transactions), the authorized capital stock of the Borrower
will consist of an aggregate of 201,000,000 shares consisting of (i) 200,000,000
shares of Common Stock, par value $.01 per share, of which 100,000,000 will be
designated as Series A Common Stock and 100,000,000 will be designated as Series
B Common Stock and (ii) 1,000,000 shares of preferred stock, of which 12,500
shares will be designated as Series A Preferred Stock and 12,500 shares will be
designated as Series B Preferred Stock. Except as disclosed in the
Registration Statement or in Schedule VI, as of the date hereof, there are no
outstanding obligations of the Borrower or any of its Subsidiaries to
repurchase, redeem, or otherwise acquire any shares of capital stock of the
Borrower nor are there any outstanding obligations of the Borrower or any of its
Subsidiaries to make payments to any Person, such as "phantom stock" payments,
where the amount thereof is calculated with reference to the fair market value
or equity value of the Borrower or any of its Subsidiaries.
SECTION 4.15. Subsidiaries and Investments.
----------------------------
(a) As at the date hereof (in the case of all Subsidiaries of the
Borrower on the Effective Date after giving effect to the Merger Transactions),
and as at the most recent date such Schedule shall be supplemented pursuant to
Section 7.03(c)(iv) (in the case of any Subsidiary formed or acquired pursuant
to any Acquisition), set forth in Part A of Schedule IV is a complete and
correct list of all of the Subsidiaries of the Borrower (excluding any
Subsidiary that shall have been sold, or the existence of which shall have been
terminated, in accordance with a transaction permitted hereunder), together
with, for each such Subsidiary, (i) the jurisdiction of organization of such
Subsidiary, (ii) each Person (other than the holders of shares of stock of the
Borrower) holding ownership interests in such Subsidiary and (iii) the nature of
the ownership interests held by each such Person and the percentage of ownership
of such Subsidiary represented by such ownership interests. As at the date
hereof, except as disclosed in Part A of Schedule IV, (x) each of the Borrower
and its Subsidiaries owns, free and clear of Liens, and has the unencumbered
right to vote, all outstanding ownership interests in each Person shown to be
held by it in Part A of Schedule IV, (y) all of the issued and outstanding
capital stock of each such Person organized as a corporation is validly issued,
fully paid and nonassessable and (z) there are no outstanding Equity Rights with
respect to such Person (excluding for these purposes any letters of intent
entered into with respect to the sale of the Dayton Station or the Providence
Station).
(b) Set forth in Part B of Schedule IV is a complete and correct list
of all Investments (other than Investments disclosed in Part A of Schedule IV)
held by the Borrower or any of its Subsidiaries in any Person on the date hereof
(or that will be held by the Borrower and its Subsidiaries on the Effective Date
after giving effect to the Merger
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Transactions) and, for each such Investment, (x) the identity of the Person or
Persons holding such Investment and (y) the nature of such Investment. Except
as disclosed in Part B of Schedule IV, each of the Borrower and its Subsidiaries
owns, free and clear of all Liens, all such Investments.
(c) Except for the Senior Subordinated Notes, none of the
Consolidated Subsidiaries of the Borrower is on the date hereof (or will be on
the Effective Date after giving effect to the Merger Transactions) subject to
any indenture, agreement, instrument or other arrangement of the type described
in Section 7.08.
SECTION 4.16. Station Licenses. As at the date hereof (in the case
----------------
of all Stations to be owned by the Borrower and its Consolidated Subsidiaries on
the Effective Date after giving effect to the Merger Transactions), and as at
the most recent date such Schedule shall be supplemented pursuant to Section
7.03(c)(iv) (in the case of any Station acquired pursuant to any Acquisition):
(a) Schedule V accurately and completely lists all Station Licenses
(other than non-material incidental microwave relay and remote transmitter
licenses) granted or assigned to the Borrower or any Consolidated
Subsidiary, or under which the Borrower and its Consolidated Subsidiaries
have the right to operate such Station. The Station Licenses listed on
said Schedule V with respect to any Station include all material
authorizations, licenses and permits issued by the FCC that are required or
necessary for the operation of such Station, and the conduct of the
business of the Borrower and its Consolidated Subsidiaries with respect to
such Station.
(b) The Station Licenses listed in said Schedule V are validly issued
in the name of, or the FCC has consented to the assignment of or transfer
of control of such Station Licenses to, the Borrower or one or more of its
Subsidiaries.
(c) Each such Station License is in full force and effect, and the
Borrower and its Consolidated Subsidiaries have fulfilled and performed in
all material respects all of their obligations with respect thereto and
have full power and authority to operate thereunder, and all consents of
the FCC to the assignment of, or transfer of control of, the principal
broadcasting licenses and any other material Station Licenses in connection
with the Merger Transactions have been approved by orders of the FCC which
orders (to the extent that any pre-grant objections have been filed) have
become final (i.e. no longer subject to further judicial or administrative
review).
(d) All operating assets, rights and other property relating to, and
material to the operations of, any Station, are owned (or are available for
use under lease, license or other arrangements entered into with third
parties) by the Borrower or one or more of its Subsidiaries.
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SECTION 4.17. Merger Agreement. The Borrower has heretofore
----------------
delivered to the Administrative Agent a complete copy (including all
modifications, waivers and supplements thereto, and exhibits and schedules) of
the Merger Agreement.
ARTICLE V
CONDITIONS
SECTION 5.01. Effective Date. The obligations of the Lenders to make
--------------
Loans, and of the Issuing Lender to issue Letters of Credit hereunder, shall not
become effective until the date on which the Administrative Agent shall have
received each of the following documents, each of which shall be satisfactory to
the Administrative Agent (and to the extent specified below, to each Lender) in
form and substance (or such condition shall have been waived in accordance with
Section 10.02):
(a) Executed Counterparts. From each party hereto either (i) a
---------------------
counterpart of this Agreement signed on behalf of such party or (ii)
written evidence satisfactory to the Administrative Agent (which may
include telecopy transmission of a signed signature page of this Agreement)
that such party has signed a counterpart of this Agreement.
(b) Opinions of Counsel to the Obligors. Favorable written opinions
-----------------------------------
(addressed to the Administrative Agent and the Lenders and dated the
Effective Date) of (i) Xxxxx Xxxxxxx Rain Xxxxxxx (A Professional
Corporation), counsel for the Obligors, substantially in the form of
Exhibit C and (ii) Wiley, Rein & Fielding and Brooks, Pierce, XxXxxxxx,
Xxxxxxxx & Xxxxxxx, special communications counsel for the Borrower,
covering the matters set forth in Exhibit D, and in each case covering such
other matters relating to the Borrower, this Agreement or the Transactions
as the Required Lenders shall reasonably request. Each Obligor hereby
requests such counsel to deliver such opinions.
(c) Opinion of Special New York Counsel to The Chase Manhattan Bank.
---------------------------------------------------------------
An opinion, dated the Effective Date, of Milbank, Tweed, Xxxxxx & XxXxxx,
special New York counsel to The Chase Manhattan Bank, substantially in the
form of Exhibit E (and The Chase Manhattan Bank hereby instructs such
counsel to deliver such opinion to the Lenders).
(d) Corporate Documents. Such documents and certificates as the
-------------------
Administrative Agent or its counsel may reasonably request relating to the
organization, existence and good standing of each Obligor, the
authorization of the Transactions and any other legal matters relating to
the Obligors, this Agreement or the Transactions, all in form and substance
reasonably satisfactory to the Administrative Agent and its counsel.
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(e) Officer's Certificate. A certificate, dated the Effective Date
---------------------
and signed by the President, a Vice President or a Financial Officer,
confirming compliance with the conditions set forth in the lettered clauses
of the first sentence of Section 5.02.
(f) Repayment of Existing Indebtedness. Evidence that the principal
----------------------------------
of and interest on, and all other amounts owing in respect of, the
Indebtedness (including any contingent or other amounts payable in respect
of letters of credit) in respect of the Existing Credit Agreement and the
Bridge Debt or indicated on Schedule II that is to be repaid on the
Effective Date shall have been (or shall be simultaneously) paid in full,
that any commitments to extend credit under the agreements or instruments
relating to such Indebtedness shall have been canceled or terminated and
that all Guarantees in respect of, and all Liens securing, any such
Indebtedness shall have been released (or arrangements for such release
satisfactory to the Administrative Agent shall have been made).
(g) Station Licenses, Etc. Evidence that all of the principal
---------------------
broadcasting licenses and any other material Station Licenses appearing in
Schedule V for each Station shall have been validly issued in the name of,
or the FCC has consented to the assignment of or the transfer of control of
such Station Licenses to, the Borrower or one or more of its Subsidiaries,
and shall be in full force and effect, and all consents to such assignments
and transfers of control will have been approved by orders of the FCC,
which orders (to the extent pre-grant objections have been filed) have
become final (i.e. no longer subject to further judicial or administrative
review).
(h) Merger Transactions. Evidence that (x) the Merger Transactions
-------------------
shall have been (or shall be simultaneously) consummated in all material
respects in accordance with the terms of the Merger Agreement (except for
any modifications, supplements or waivers thereof, or written consents or
determinations made by the parties thereto, that shall be satisfactory to
the Required Lenders or that shall not result in a Material Adverse
Effect), and (y) the percentage of the aggregate outstanding stockholders
of the Borrower that have reserved their statutory dissenters' rights as
described in the Registration Statement shall not exceed 5%, and the
Administrative Agent shall have received a certificate of a Financial
Officer to the effect of the foregoing clauses (x) and (y), and to the
effect that attached thereto are true and complete copies of the documents
delivered in connection with the closing of the Merger Transactions
pursuant to the Merger Agreement.
(i) Leverage Ratio. A certificate of a Financial Officer setting
--------------
forth a calculation of the Leverage Ratio as at the Effective Date, after
giving effect to the Merger Transactions.
(j) Private Placement Debt. Evidence that the holders of the Private
----------------------
Placement Debt shall have consented to (or the Private Placement Debt
Documents otherwise have been amended to permit) the Merger Transactions
and this Agreement (including
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to the provisions of Section 2.05(k)) and that the Private Placement Debt
Documents shall have been modified in connection therewith in a manner in
form and substance satisfactory to the Required Lenders.
(k) Other Documents. Such other documents as the Administrative
---------------
Agent or any Lender or special New York counsel to The Chase Manhattan Bank
may reasonably request.
The obligation of any Lender to make its initial extension of credit
hereunder is also subject to the payment by the Borrower of such fees as the
Borrower shall have agreed to pay to any Lender or the Administrative Agent in
connection herewith, including the reasonable fees and expenses of Milbank,
Tweed, Xxxxxx & XxXxxx, special New York counsel to The Chase Manhattan Bank, in
connection with the negotiation, preparation, execution and delivery of this
Agreement and the other Loan Documents and the extensions of credit hereunder
(to the extent that statements for such fees and expenses have been delivered to
the Borrower).
The Administrative Agent shall notify the Borrower and the Lenders of
the Effective Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders to make Loans and
of the Issuing Lender to issue Letters of Credit hereunder shall not become
effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 10.02) on or prior to 3:00 p.m., New York City time, on
September 16, 1997 (and, in the event such conditions are not so satisfied or
waived, the Commitments shall terminate at such time).
SECTION 5.02. Each Credit Event. The obligation of each Lender to
-----------------
make a Loan on the occasion of any Borrowing, and of the Issuing Lender to
issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:
(a) the representations and warranties of the Borrower set forth in
this Agreement, and of each Obligor in each of the other Loan Documents to
which it is a party, shall be true and correct on and as of the date of
such Borrowing or the date of issuance, amendment, renewal or extension of
such Letter of Credit, as applicable, unless such representation or
warranty is expressly stated to have been made as of a specific date (such
as the date hereof or the Effective Date), in which case such
representation and warranty shall be true and correct on and as of such
specific date; and
(b) at the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such Letter
of Credit, as applicable, no Default shall have occurred and be continuing.
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Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in the preceding
sentence.
ARTICLE VI
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full and all Letters of Credit shall have expired or terminated and
all LC Disbursements shall have been reimbursed or covered, the Borrower
covenants and agrees with the Lenders that:
SECTION 6.01. Financial Statements and Other Information. The
------------------------------------------
Borrower will furnish to the Administrative Agent and each Lender:
(a) as soon as available and in any event within 90 days after the
end of each fiscal year of the Borrower, consolidated statements of
operations, stockholders' equity and cash flows of the Borrower and its
Subsidiaries and of the Borrower and its Consolidated Subsidiaries (and,
separately stated, of each Designated Subsidiary) for such fiscal year and
the related consolidated balance sheets of the Borrower and its
Subsidiaries and of the Borrower and its Consolidated Subsidiaries (and,
separately stated, of each Designated Subsidiary) as at the end of such
fiscal year, setting forth in each case in comparative (or, for periods
prior to any Acquisition, comparative historical) form the corresponding
consolidated (or, in the case of a Designated Subsidiary, separately
stated) figures for the preceding fiscal year, and accompanied
(i) in the case of said consolidated statements and
balance sheet of the Borrower and its Subsidiaries, by an opinion
thereon of independent certified public accountants of recognized
national standing, which opinion shall state that said consolidated
financial statements fairly present the consolidated financial
condition and results of operations of the Borrower and its
Subsidiaries as at the end of, and for, such fiscal year in accordance
with GAAP, consistently applied (except as noted pursuant to paragraph
(c) below),
(ii) in the case of said consolidated statements and
balance sheet of the Borrower and its Consolidated Subsidiaries, by a
report of independent certified public accountants of recognized
national standing, which report shall state that said consolidated
financial statements have been reviewed by such accountants, and
(iii) in the case of said consolidated statements and
balance sheet of the Borrower and its Consolidated Subsidiaries (and
separate statements and
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balance sheets for a Designated Subsidiary), by a certificate of a
Financial Officer, which certificate shall state that said
consolidated financial statements fairly present the consolidated
financial condition and results of operations of the Borrower and its
Consolidated Subsidiaries (and, in the case of each Designated
Subsidiary, said separately stated financial statements fairly present
the respective results of operations of such Designated Subsidiary),
in each case in accordance with (except, in the case of the
consolidated financial statements of the Borrower and its Consolidated
Subsidiaries for the exclusion therefrom of the Designated
Subsidiaries) GAAP, consistently applied (except as noted pursuant to
paragraph (c) below), as at the end of, and for, such fiscal year;
(b) as soon as available and in any event within 60 days after the
end of each of the first three quarterly fiscal periods of each fiscal year
of the Borrower, consolidated statements of operations, stockholders'
equity and cash flows of the Borrower and its Subsidiaries and of the
Borrower and its Consolidated Subsidiaries (and, separately stated, of each
Designated Subsidiary) for such period and for the period from the
beginning of the respective fiscal year to the end of such period, and the
related consolidated balance sheets of the Borrower and its Subsidiaries
and of the Borrower and its Consolidated Subsidiaries (and, separately
stated, of each Designated Subsidiary) as at the end of such period,
setting forth in each case in comparative (or for periods prior to any
Acquisition, comparative historical) form the corresponding consolidated
(or, in the case of a Designated Subsidiary, separately stated) figures for
the corresponding periods in the preceding fiscal year (except that, in the
case of balance sheets, such comparison shall be to the last day of the
prior fiscal year), accompanied by a certificate of a Financial Officer,
which certificate shall state that said consolidated financial statements
fairly present the consolidated financial condition and results of
operations of, as the case may be, the Borrower and its Subsidiaries and
the Borrower and its Consolidated Subsidiaries (or of such Designated
Subsidiary, as the case may be), in each case in accordance with (except,
in the case of the consolidated financial statements of the Borrower and
its Consolidated Subsidiaries, for the exclusion therefrom of the
Designated Subsidiaries) GAAP, consistently applied (except as noted
pursuant to paragraph (c) below), as at the end of, and for, such period
(subject to normal year-end audit adjustments);
(c) concurrently with any delivery of financial statements under
clause (a) or (b) of this Section, a certificate of a Financial Officer (i)
certifying as to whether a Default has occurred and, if a Default has
occurred, specifying the details thereof and any action taken or proposed
to be taken with respect thereto, (ii) setting forth reasonably detailed
calculations demonstrating compliance with Sections 7.01, 7.06 and 7.10 and
(iii) stating whether any change in GAAP or in the application thereof has
occurred since the date of the audited financial statements referred to in
Section 4.04 that affects (or in the future is reasonably likely to affect)
in any material respect the presentation of financial information with
respect to the Borrower and its Subsidiaries
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required hereunder and, if any such change has occurred, specifying the
effect of such change on the financial statements accompanying such
certificate;
(d) concurrently with any delivery of financial statements under
clause (a) of this Section, a statement of the accounting firm that
reported on such financial statements stating whether they obtained
knowledge during the course of their examination of such financial
statements of any default by the Borrower under Section 7.10 (insofar as
such Section relates to accounting matters) (which statement may be limited
by accounting rules or guidelines);
(e) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by
the Borrower or any of its Subsidiaries with the Securities and Exchange
Commission, or any Governmental Authority succeeding to any or all of the
functions of said Commission, or with any national securities exchange, or
distributed by the Borrower to its stockholders generally or to holders of
any class of Indebtedness generally, as the case may be;
(f) promptly upon their becoming available, copies of any and all
periodic or special reports filed by the Borrower or any of its
Consolidated Subsidiaries with the FCC or with any other Federal, state or
local governmental authority, if such reports indicate any material adverse
change in the business, operations, affairs or condition of the Borrower
and its Consolidated Subsidiaries, taken as a whole, or if copies thereof
are requested by any Lender or the Administrative Agent, and copies of any
and all notices and other communications from the FCC or from any other
Federal, state or local governmental authority with respect to the
Borrower, any of its Consolidated Subsidiaries or any Station that raises
any matters that could, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect; and
(g) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any of its Consolidated Subsidiaries, or compliance with the
terms of this Agreement and the other Loan Documents, as the Administrative
Agent or any Lender may reasonably request.
SECTION 6.02. Notices of Material Events. The Borrower will furnish
--------------------------
to the Administrative Agent and each Lender prompt written notice of the
following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by
or before any arbitrator or Governmental Authority against or affecting the
Borrower or any of its Affiliates that, if adversely determined, could
reasonably be expected to result in a Material Adverse Effect;
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(c) the occurrence of any ERISA Event that, alone or together with
any other ERISA Events that have occurred, could reasonably be expected to
result in a Material Adverse Effect; and
(d) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
SECTION 6.03. Existence; Conduct of Business. The Borrower will, and
------------------------------
will cause each of its Consolidated Subsidiaries to, do or cause to be done all
things necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
--------
any merger, consolidation, liquidation or dissolution permitted under Section
7.03.
SECTION 6.04. Payment of Obligations. The Borrower will, and will
----------------------
cause each of its Consolidated Subsidiaries to, pay its obligations, including
Tax liabilities, that, if not paid, could result in a Material Adverse Effect
before the same shall become delinquent or in default, except where (a) the
validity or amount thereof is being contested in good faith by appropriate
proceedings, (b) the Borrower or such Consolidated Subsidiary has set aside on
its books adequate reserves with respect thereto in accordance with GAAP and (c)
the failure to make payment pending such contest could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 6.05. Maintenance of Properties; Insurance. The Borrower
------------------------------------
will, and will cause each of its Consolidated Subsidiaries to, (a) keep and
maintain all property material to the conduct of its business in good working
order and condition, ordinary wear and tear excepted, and (b) maintain, with
financially sound and reputable insurance companies, insurance in such amounts
and against such risks as are customarily maintained by companies engaged in the
same or similar businesses operating in the same or similar locations, provided
--------
that the Borrower will in any event maintain (with respect to itself and each of
its Consolidated Subsidiaries) casualty insurance and insurance against claims
for damages with respect to defamation, libel, slander, privacy or other similar
injury to person or reputation (including misappropriation of personal
likeness), in such amounts as are then customary for Persons engaged in the same
or similar business similarly situated.
SECTION 6.06. Books and Records; Inspection Rights. The Borrower
------------------------------------
will, and will cause each of its Consolidated Subsidiaries to, keep proper books
of record and account in which full, true and correct entries are made of all
dealings and transactions in relation to its business and activities. The
Borrower will, and will cause each of its
-76-
Consolidated Subsidiaries to, permit any representatives designated by the
Administrative Agent or any Lender, upon reasonable prior notice, to visit and
inspect its properties, to examine and make extracts from its books and records,
and to discuss its affairs, finances and condition with its officers and
independent accountants, all at such reasonable times and as often as reasonably
requested.
SECTION 6.07. Compliance with Laws. The Borrower will, and will
--------------------
cause each of its Consolidated Subsidiaries to, comply with all laws, rules,
regulations and orders of any Governmental Authority, including, but not limited
to, Environmental Laws applicable to it or its property, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 6.08. Use of Proceeds and Letters of Credit. The proceeds of
-------------------------------------
the Loans will be used to finance the cash portion of the Merger Transactions,
to pay for fees and expenses relating thereto, to finance acquisitions pursuant
to Section 7.03(c), to refinance existing indebtedness of the Borrower
(including the Senior Subordinated Notes, indebtedness under the Existing Credit
Agreement, the Bridge Debt and the Private Placement Debt), to repurchase
outstanding shares of capital stock of the Borrower (to the extent permitted
hereunder) and for general corporate purposes of the Borrower and its
Subsidiaries. No part of the proceeds of any Loan will be used, whether
directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations G, U and X.
SECTION 6.09. Certain Obligations Respecting Subsidiaries.
-------------------------------------------
(a) Wholly Owned Subsidiaries. Subject to paragraph (b) below, the
-------------------------
Borrower will, and will cause each of its Subsidiaries to, take such action from
time to time as shall be necessary to ensure that each of its Consolidated
Subsidiaries is a Wholly Owned Subsidiary.
(b) Designated Subsidiaries. Notwithstanding the provisions of
-----------------------
paragraph (a) above, the Borrower may at any time after the date hereof
designate any Subsidiary (other than a Subsidiary holding any Station Licenses
or the operating assets of any Stations) as a "Designated Subsidiary" for
purposes of this Agreement, by delivering to the Administrative Agent a
certificate of a senior officer of the Borrower (and the Administrative Agent
shall promptly deliver a copy thereof to each Lender following receipt)
identifying such Subsidiary, stating that such Subsidiary shall be treated as a
"Designated Subsidiary" for all purposes hereof and certifying that, after
giving effect to such designation, the Borrower will be in compliance with the
provisions of this Agreement applicable to such Designated Subsidiary (including
the provisions of Section 7.05(f) with respect to the type of business in which
a Designated Subsidiary shall be involved and the limitations upon the aggregate
amount of Investments in Designated Subsidiaries therein specified), and such
designation will not result in a Default hereunder. In the event of any such
designation of a Subsidiary that is at the time a Subsidiary Guarantor
hereunder, the Administrative Agent agrees (to the extent such designation
complies with the requirements of the immediately preceding sentence) to release
such Subsidiary from its Guarantee hereunder, and in that connection to execute
and deliver
-77-
(at the expense of the Borrower) such instruments as the Borrower shall
reasonably request to effect such release. Any Subsidiary of a Designated
Subsidiary shall be deemed to be a "Designated Subsidiary".
The Borrower may at any time rescind the designation of any Subsidiary
as a "Designated Subsidiary" for purposes of this Agreement, by delivering to
the Administrative Agent (which shall promptly forward a copy thereof to each
Lender) a certificate of a Financial Officer identifying such Subsidiary,
stating that such Subsidiary shall no longer be treated as a "Designated
Subsidiary" for purposes hereof and certifying that, after giving effect to such
rescission, the Borrower will be in compliance with the provisions of this
Agreement applicable to Consolidated Subsidiaries (and, without limiting the
generality of the foregoing, upon such rescission and as a condition thereto,
the Borrower agrees to comply with the requirements of paragraph (c) below with
respect to such Subsidiary).
(c) Subsidiary Guarantors. The Borrower will take such action, and
---------------------
will cause each of its Subsidiaries to take such action, from time to time as
shall be necessary to ensure that all Consolidated Subsidiaries of the Borrower
are "Subsidiary Guarantors" hereunder. Without limiting the generality of the
foregoing, in the event that the Borrower or any of its Subsidiaries shall form
or acquire any new Subsidiary that shall constitute a Consolidated Subsidiary
hereunder (including any Subsidiary of the Borrower that shall become a
Subsidiary of the Borrower in connection with any Acquisition, but excluding any
new Subsidiary that is a Designated Subsidiary), the Borrower and its
Subsidiaries will cause such new Subsidiary to
(i) become a "Subsidiary Guarantor" hereunder pursuant to a
Guarantee Assumption Agreement, and
(ii) deliver such proof of corporate action, incumbency of
officers, opinions of counsel and other documents as is consistent with
those delivered by each Obligor pursuant to Section 5.01 on the Effective
Date or as the Administrative Agent shall have reasonably requested.
ARTICLE VII
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal of
and interest on each Loan and all fees payable hereunder have been paid in full
and all Letters of Credit have expired or terminated and all LC Disbursements
shall have been reimbursed or covered, the Borrower covenants and agrees with
the Lenders that:
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SECTION 7.01. Indebtedness. The Borrower will not, nor will it
------------
permit any of its Consolidated Subsidiaries to, create, incur, assume or permit
to exist any Indebtedness, except:
(a) Indebtedness hereunder;
(b) Indebtedness existing on the date hereof and set forth in Part A
of Schedule II (including Indebtedness relating to the Hearst Stations
assumed in connection with the Merger Transactions, but excluding,
following the making of the initial Loans hereunder, the Indebtedness to be
repaid with the proceeds of such Loans, as indicated on Schedule II),
together with any extensions, renewals, refinancings or replacements of any
such Indebtedness so long as the principal thereof is not increased and
such Indebtedness, as so extended, renewed, refinanced or replaced, would
constitute Indebtedness that could be incurred in compliance with Section
7.01(g);
(c) Indebtedness of any Consolidated Subsidiary to the Borrower or
any other Consolidated Subsidiary;
(d) Guarantees by the Borrower of Indebtedness of any Consolidated
Subsidiary and by any Consolidated Subsidiary of Indebtedness of the
Borrower or any other Consolidated Subsidiary;
(e) Indebtedness of the Borrower and its Subsidiaries in respect of
the deferred payment of insurance premiums up to an aggregate principal
amount not exceeding $10,000,000 at any one time outstanding;
(f) Indebtedness of any Person that becomes a Consolidated Subsidiary
after the Effective Date; provided that such Indebtedness exists at the
--------
time such Person becomes a Subsidiary and is not created in contemplation
of or in connection with such Person becoming a Consolidated Subsidiary;
(g) additional Indebtedness of the Borrower (and of its Consolidated
Subsidiaries in respect of a Guarantee of such Indebtedness), incurred
after the Effective Date (or assumed in connection with an Acquisition),
provided that
--------
(i) the stated maturity date with respect to such
Indebtedness shall be at least six months after the Maturity Date,
(ii) no principal payments with respect to such
Indebtedness shall be stated to be due prior to the Maturity Date
(other than in respect of a Change of Control or similar event),
except that if such Indebtedness is pari passu in right of payment
---- -----
with the obligations of the Obligors hereunder (i.e. not subordinated
in right of payment to such obligations), such Indebtedness may
provide for principal payments prior to the Maturity Date, so long as
the
-79-
weighted average life to maturity of such Indebtedness (determined in
accordance with GAAP) is not earlier than the weighted average life to
maturity of the Loans hereunder,
(iii) all covenants with respect to such Indebtedness shall
be no more restrictive then the covenants set forth in this Agreement
and the Borrower shall be in compliance with such covenants,
(iv) such Indebtedness is not secured by any Lien on
property of the Borrower or any Consolidated Subsidiary,
(v) any Guarantee by a Consolidated Subsidiary of such
Indebtedness shall provide that such Guarantee shall be released in
the event that such Consolidated Subsidiary is to be sold by the
Borrower, and
(vi) at the time of such incurrence, and after giving
effect thereto, no Default shall have occurred and be continuing and
the Borrower shall be in pro forma compliance with Section 7.10 (the
determination of such pro forma compliance to be calculated, as at the
end of and for the period of four fiscal quarters most recently ended
prior to the date of such incurrence for which financial statements of
the Borrower and its Consolidated Subsidiaries are available, under
the assumption that such incurrence shall have occurred at the
beginning of the applicable period) and the Borrower shall have
delivered to the Administrative Agent a certificate of a Financial
Officer showing such calculations in reasonable detail to demonstrate
such compliance; and
(h) other secured Indebtedness in an aggregate principal amount not
exceeding $25,000,000 and other Indebtedness in an aggregate principal
amount not exceeding $100,000,000, in either case at any time outstanding.
SECTION 7.02. Liens. The Borrower will not, nor will it permit any
-----
of its Consolidated Subsidiaries to, create, incur, assume or permit to exist
any Lien on any property or asset now owned or hereafter acquired by it, or
assign or sell any income or revenues (including accounts receivable) or rights
in respect of any thereof, except:
(a) Permitted Encumbrances;
(b) any Lien on any property or asset of the Borrower or any of its
Consolidated Subsidiaries existing on the date hereof and set forth in Part
B of Schedule II (including Liens relating to the Hearst Stations assumed
in connection with the Merger Transactions, but excluding, following the
making of the initial Loans hereunder, Liens securing Indebtedness to be
repaid with the proceeds of such Loans, as indicated on Schedule II);
provided that (i) no such Lien shall extend to any other
--------
-80-
property or asset of the Borrower or any of its Consolidated Subsidiaries
and (ii) such Lien shall secure only those obligations which it secures on
the date hereof;
(c) any Lien existing on any property or asset of any Person that
becomes a Consolidated Subsidiary after the Effective Date prior to the
time such Person becomes a Consolidated Subsidiary; provided that (i) such
--------
Lien is not created in contemplation of or in connection with such Person
becoming a Consolidated Subsidiary, (ii) such Lien shall not apply to any
other property or assets of the Borrower or any Consolidated Subsidiary,
(iii) such Lien shall secure only those obligations which it secures on the
date such Person becomes a Consolidated Subsidiary and (iv) the aggregate
amount of Indebtedness or other obligations secured thereby shall not
exceed $25,000,000; and
(d) Liens on fixed or capital assets acquired, constructed or
improved by the Borrower or any Consolidated Subsidiary; provided that (i)
--------
such security interests secure Indebtedness permitted by clause (h) of
Section 7.01, (ii) such security interests and the Indebtedness secured
thereby are incurred prior to or within 90 days after such acquisition or
the completion of such construction or improvement, (iii) the Indebtedness
secured thereby does not exceed the cost of acquiring, constructing or
improving such fixed or capital assets, (iv) such security interests shall
not apply to any other property or assets of the Borrower or any
Consolidated Subsidiary and (v) the aggregate amount of Indebtedness or
other obligations secured thereby shall not exceed $25,000,000.
SECTION 7.03. Fundamental Changes.
-------------------
(a) Mergers and Consolidations. The Borrower will not, nor will it
--------------------------
permit any of its Consolidated Subsidiaries to, enter into any transaction of
merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself
(or suffer any liquidation or dissolution); provided that, subject to Section
--------
7.04, and so long as after giving effect thereto no Default shall have occurred
and be continuing hereunder, (i) any Consolidated Subsidiary of the Borrower may
merge into or consolidate with the Borrower or any Subsidiary Guarantor so long
as the Borrower or a Subsidiary Guarantor is the continuing or surviving party,
(ii) any Consolidated Subsidiary of the Borrower may liquidate or dissolve into
the Borrower or any Subsidiary Guarantor and (iii) the Borrower and its
Consolidated Subsidiaries may enter into the transactions permitted under
clauses (B), (C) or (D) of paragraph (b) below, and under clause (iv) of
paragraph (c) below.
(b) Dispositions. The Borrower will not, nor will it permit any of
------------
its Consolidated Subsidiaries to, sell, transfer, lease or otherwise dispose of
all or any substantial part of its assets, except that, if at the time thereof
and immediately after giving effect thereto no Default shall have occurred and
be continuing (i) any Consolidated Subsidiary may sell, transfer, lease or
otherwise dispose of its assets to the Borrower or another Consolidated
Subsidiary and (ii) the Borrower and any of its Consolidated Subsidiaries may
sell, transfer,
-81-
lease, exchange or dispose of (in one transaction or in a series of transactions
and, in the case of clauses (B), (C) and (D) below, in any form, including by
way of a merger or consolidation the effect of which is to result in the
disposition of the respective Station):
(A) any part of its assets in the ordinary course of business and on
ordinary business terms,
(B) the Dayton Station and the Providence Station,
(C) any one or more Stations, so long as the Broadcast Cash Flow
attributed to all Stations sold or exchanged pursuant to this clause (C)
(but not pursuant to clause (B)) during any fiscal year shall not exceed
25% of the Broadcast Cash Flow for such fiscal year nor 50% of the
Broadcast Cash Flow for any period five consecutive fiscal years (Broadcast
Cash Flow, for purposes hereof, to be determined under the assumption that
none of the sales otherwise permitted under this clause (C) had occurred
during such fiscal year or five fiscal year period and that the Broadcast
Cash Flow of any Station sold during such period remained unchanged after
such sale), and
(D) any non-broadcast assets acquired by the Borrower and its
Consolidated Subsidiaries.
(c) Acquisitions. The Borrower will not, nor will it permit any of
------------
its Consolidated Subsidiaries to, acquire any business or property from, or
capital stock of, or be a party to any acquisition of, any Person except:
(i) purchases of equipment, programming rights and other
property to be sold or used in the ordinary course of business;
(ii) Investments permitted under Section 7.05;
(iii) Capital Expenditures; and
(iv) the Borrower and its Consolidated Subsidiaries may,
pursuant to a merger or consolidation, a purchase of stock or assets or
entering into an LMA Arrangement (any such transaction being herein called
an "Acquisition"), acquire after the date hereof (or, in the case of an LMA
-----------
Arrangement, acquire the right to operate) additional television
broadcasting stations (any such station that is the subject of any
Acquisition being hereinafter referred to as an "Acquired Station"), and
----------------
additional broadcast industry related assets, so long as:
(A) in the case of any Acquisition (other than of one or more
television broadcasting stations), the aggregate Purchase Price of any
single such Acquisition shall not exceed $100,000,000 and of all such
Acquisitions after the Effective Date shall not exceed $200,000,000;
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(B) except if such Acquisition constitutes an LMA Arrangement,
the assignment or transfer of control of the Station Licenses with
respect to such Acquired Station shall have been approved by an order
or orders of the FCC, which order or orders (to the extent that any
pre-grant objections have been filed) shall have become final (i.e. no
longer subject to further judicial or administrative review);
(C) immediately prior to such Acquisition and after giving
effect thereto, (1) no Default shall have occurred and be continuing
and (2) the Borrower shall be in pro forma compliance with Section
7.10 (the determination of such pro forma compliance to be calculated,
as at the end of and for the period of four fiscal quarters most
recently ended prior to the date of such Acquisition for which
financial statements of the Borrower and its Consolidated Subsidiaries
are available, under the assumption that such Acquisition shall have
occurred at the beginning of the applicable period) and the Borrower
shall have delivered to the Administrative Agent a certificate of a
Financial Officer showing such calculations in reasonable detail to
demonstrate such compliance;
(D) in connection with such Acquisition the Borrower shall have
delivered to the Administrative Agent environmental surveys and
assessments prepared by a firm of licensed engineers in form and
substance reasonably satisfactory to the Administrative Agent
reflecting that the assets or Subsidiary being acquired in such
Acquisition is not subject to any material environmental liabilities;
(E) the Borrower shall have delivered evidence satisfactory to
the Administrative Agent that the Borrower and its Consolidated
Subsidiaries will not become liable, contingently or otherwise, in
respect of any material tax or material ERISA liability of the
respective seller (or the entity owning the Acquired Station or
broadcast industry related assets) as a result of such Acquisition;
and
(F) concurrently with the consummation of such Acquisition, the
Borrower shall have supplemented Schedules IV and V in order that such
Schedules accurately reflect any additional Consolidated Subsidiaries
formed or acquired pursuant to such Acquisition and accurately
identify the respective Station Licenses (other than non-material
incidental microwave relay and remote transmitter Licenses) of any
Acquired Station.
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SECTION 7.04. Lines of Business.
-----------------
(a) Business Activities. The Borrower will not at any time permit
-------------------
less than 75% of EBITDA to be derived from the television and radio broadcast
business (it being understood that the broadcast production business, as
conducted on the date hereof by "Hearst Broadcasting Productions" (as such term
is defined in the Merger Agreement), shall not be deemed to be the television
and radio broadcast business).
(b) Network Affiliation. The Borrower will cause any Station that is
-------------------
subject to an affiliation agreement with one of National Broadcasting Company,
Inc., Fox Broadcasting Company, CBS, Inc. or American Broadcasting Companies,
Inc. (each, a "Major Network") to maintain such agreement in full force and
-------------
effect, provided that (i) the Borrower may permit such Station to become subject
--------
to any new or substitute affiliation agreement with such or any other Major
Network and (ii) the Borrower may permit any one or more of such affiliation
agreements to expire or be terminated so long as the percentage of the aggregate
Broadcast Cash Flow of the Borrower and its Consolidated Subsidiaries during the
term of this Agreement attributable to Stations that cease to be so affiliated
shall not exceed 20%. With respect to any Station that is not subject to an
affiliation agreement with a Major Network, including any Station that is
currently affiliated with the Warner Brothers Network or the United Paramount
Network (each, an "Emerging Network"), the Borrower may permit such Station (i)
----------------
to cease to be party to any affiliation agreement, (ii) to become a party to an
affiliation agreement with a Major Network (in which event such Station shall
not become subject to the immediately preceding sentence) or (iii) to become a
party to an affiliation agreement with the other Emerging Network or any similar
emerging network.
(c) LMA Arrangements. The Borrower will not permit the aggregate
----------------
percentage of EBITDA for any period of four consecutive fiscal quarters that is
attributable to Stations subject to LMA Arrangements to exceed 20% of the
aggregate EBITDA for such period.
(d) License Subsidiaries. In the event that the Required Lenders
--------------------
shall deem the same to be necessary after the occurrence and during the
continuance of an Event of Default, the Borrower will create one or more
Subsidiaries to which the Station Licenses of each of the Stations of the
Borrower will be transferred (and will effect such transfer, and will deliver
evidence thereof and of all necessary FCC approvals to the Administrative Agent
within 180 days after such request).
SECTION 7.05. Investments. The Borrower will not, nor will it permit
-----------
any of its Consolidated Subsidiaries to, make or permit to remain outstanding
any Investments except:
(a) Investments outstanding on the date hereof and identified in Part
B of Schedule IV;
-84-
(b) operating deposit accounts with banks;
(c) Permitted Investments;
(d) Investments by the Borrower and its Consolidated Subsidiaries in
the Borrower and its Consolidated Subsidiaries;
(e) Hedging Agreements entered into in the ordinary course of the
Borrower's financial planning and not for speculative purposes;
(f) Investments (not including, however, Guarantees of obligations)
by the Borrower and its Consolidated Subsidiaries in Designated
Subsidiaries or other entities that are, in either case, involved in a
business related to the business of the Borrower and its Consolidated
Subsidiaries, so long as the amount of such Investments shall not exceed
$250,000,000 at any one time outstanding;
(g) Investments constituting Acquisitions permitted under Section
7.03; and
(h) so long as at the time thereof, and after giving effect thereto,
no Default shall have occurred and be continuing, the Borrower may make
additional Investments (each a "Basket Investment") as follows:
-----------------
(i) if after giving effect to such Basket Investment the
Leverage Ratio shall be greater than 4.00 to 1, the Borrower may make
any Basket Investment (the "Current Basket Investment") so long as the
-------------------------
aggregate amount of all Basket Investments and Restricted Payments
made during the period commencing on the Effective Date through and
including the date upon which the Current Basket Investment is to be
made shall not exceed the sum of (w) $100,000,000 plus (x) the net
----
cash proceeds from all Equity Issuances after the Effective Date plus
----
(y) the aggregate amount of Net Cash Proceeds from Dispositions not
required to be applied to the prepayment of Loans, or the reduction of
Commitments, pursuant to Section 2.10(b)(ii) plus (z) 33-1/3% of the
----
cumulative amount of Excess Cash Flow for the period commencing on the
Effective Date through and including the fiscal quarter most recently
ended prior to the date of the Current Basket Investment for which
financial statements are available; and
(ii) if after giving effect to such Basket Investment the
Leverage Ratio shall be less than or equal to 4.00 to 1, the Borrower
may make Basket Investments in any amount.
A Basket Investment permitted by Section 7.05(h) at the time of its making may
remain outstanding at a subsequent time notwithstanding that additional Basket
Investments could not be made at such subsequent time. The aggregate amount of
an Investment at any one time
-85-
outstanding for purposes of clauses (f) and (h) above, shall be deemed to be
equal to (A) the aggregate amount of cash, together with the aggregate fair
market value of property, loaned, advanced, contributed, transferred or
otherwise invested that gives rise to such Investment minus (B) the aggregate
-----
amount of dividends, distributions or other payments received in cash in respect
of such Investment; the amount of an Investment shall not in any event be
reduced by reason of any write-off of such Investment.
SECTION 7.06. Restricted Payments. The Borrower will not, nor will
-------------------
it permit any of its Consolidated Subsidiaries to, declare or make, or agree to
pay or make, directly or indirectly, any Restricted Payment, except that, so
long as at the time thereof, and after giving effect thereto, no Default shall
have occurred and be continuing, the Borrower may make Restricted Payments as
follows:
(a) if after giving effect to such Restricted Payment the Leverage
Ratio shall be greater than 4.00 to 1, the Borrower may make any Restricted
Payment (the "Current Restricted Payment") so long as the aggregate amount
--------------------------
of all Restricted Payments and Basket Investments made during the period
commencing on the Effective Date through and including the date upon which
the Current Restricted Payment is to be made shall not exceed the sum of
(w) $100,000,000 plus (x) the net cash proceeds from all Equity Issuances
----
after the Effective Date plus (y) the aggregate amount of Net Cash Proceeds
----
from Dispositions not required to be applied to the prepayment of Loans, or
the reduction of Commitments, pursuant to Section 2.10(b)(ii) plus (z) 33-
----
1/3% of the cumulative amount of Excess Cash Flow for the period commencing
on the Effective Date through and including the fiscal quarter most
recently ended prior to the date of the Current Restricted Payment for
which financial statements are available; and
(b) if after giving effect to such Restricted Payment the Leverage
Ratio shall be less than or equal to 4.00 to 1, the Borrower may make
Restricted Payments in any amount.
Nothing herein shall be deemed to prohibit the payment of dividends by
any Subsidiary of the Borrower to the Borrower or to any other Subsidiary of the
Borrower.
SECTION 7.07. Transactions with Affiliates. The Borrower will not,
----------------------------
nor will it permit any of its Consolidated Subsidiaries to, sell, lease or
otherwise transfer any property or assets to, or purchase, lease or otherwise
acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except the following:
(a) transactions at prices and on terms and conditions not less
favorable to the Borrower or such Consolidated Subsidiary than could be
obtained on an arm's-length basis from unrelated third parties,
-86-
(b) transactions between or among the Borrower and its Wholly Owned
Subsidiaries (other than Designated Subsidiaries) not involving any other
Affiliate,
(c) any Restricted Payment permitted by Section 7.06 or any
Investment permitted by Section 7.05,
(d) the options on certain television stations granted by Hearst in
favor of the Borrower and described in Exhibit 9.01(i) of the Merger
Agreement,
(e) arrangements between Hearst and the Borrower, with respect to
payroll, insurance, data processing, employee benefits, tax services,
accounting, corporate, financial, legal and other administrative items that
are on terms and conditions not less favorable to the Borrower than those
arrangements historically existing between Hearst and the Hearst Stations
and reflected in the projections set forth in the Information Memorandum,
it being understood that an increase in payments to Hearst based upon an
increase in the size of the business of the Borrower and its Subsidiaries
(resulting in an increase in payroll, insurance, data processing, employee
benefits, tax services, accounting, corporate, financial, legal and other
administrative items),
(f) the Tax Sharing Agreement, and
(g) the transactions, plans and agreements described under the
heading "Interests of Certain Persons in the Hearst Transactions; Affiliate
Transactions" in the Registration Statement.
SECTION 7.08. Restrictive Agreements. The Borrower will not, and
----------------------
will not permit any of its Consolidated Subsidiaries to, directly or indirectly,
enter into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (a) the ability of the
Borrower or any Consolidated Subsidiary to create, incur or permit to exist any
Lien upon any of its property or assets, or (b) the ability of any Consolidated
Subsidiary to pay dividends or other distributions with respect to any shares of
its capital stock or to make or repay loans or advances to the Borrower or any
other Consolidated Subsidiary or to Guarantee Indebtedness of the Borrower or
any other Consolidated Subsidiary; provided that (i) the foregoing shall not
--------
apply to restrictions and conditions imposed by law or by this Agreement, (ii)
the foregoing shall not apply to restrictions and conditions existing pursuant
to the Senior Subordinated Notes (but shall apply to any extension or renewal
of, or any amendment or modification expanding the scope of, any such
restriction or condition), (iii) the foregoing shall not apply to customary
restrictions and conditions contained in agreements relating to the sale of a
Consolidated Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Consolidated Subsidiary that is to be sold and such
sale is permitted hereunder, (iv) clause (a) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness, (v) clause (a)
of the foregoing shall not
-87-
apply to customary provisions in leases and other contracts restricting the
assignment thereof and (vi) clauses (a) and (b) of the foregoing shall not apply
to any Indebtedness that is pari passu in right of payment with the obligations
---- -----
of the Obligors hereunder (i.e. not subordinated in right of payment to such
obligations).
SECTION 7.09. Modifications of Certain Documents. Without the prior
----------------------------------
consent of the Administrative Agent (to be given upon the approval of the
Required Lenders), the Borrower will not consent to any modification, supplement
or waiver of (i) any of the provisions of any agreement, instrument or other
document evidencing or relating to Additional Permitted Indebtedness or the
Senior Subordinated Notes (or the Indenture pursuant to which the Senior
Subordinated Notes have been issued) or (ii) the Merger Agreement in a manner
that, in either case, would be materially adverse to the Lenders.
SECTION 7.10. Certain Financial Covenants.
---------------------------
(a) Leverage Ratio. The Borrower will not permit the Leverage Ratio
--------------
to exceed the following respective ratios at any time during the following
respective periods:
Period Ratio
------ -----
From the Effective Date
through December 30, 1999 5.50 to 1
From December 31, 1999
through December 30, 2000 5.00 to 1
From December 31, 2000
through December 30, 2001 4.50 to 1
From December 31, 2001
and at all times thereafter 4.00 to 1
(b) Interest Coverage Ratio. The Borrower will not permit the
-----------------------
Interest Coverage Ratio to be less than (i) 2.00 to 1 as at the last day of any
fiscal quarter ending on or before the fiscal quarter ending December 31, 1999
and (ii) 2.50 to 1 as at the last day of any fiscal quarter thereafter.
(c) Fixed Charges Ratio. The Borrower will not permit the Fixed
-------------------
Charges Ratio to be less than 1.15 to 1 as at the last day of any fiscal
quarter.
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ARTICLE VIII
EVENTS OF DEFAULT
If any of the following events ("Events of Default") shall occur:
-----------------
(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the
same shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or (after
notice from any Lender or the Administrative Agent) any fee or any other
amount (other than an amount referred to in clause (a) of this Article)
payable under this Agreement or under any other Loan Document, when and as
the same shall become due and payable, and such failure shall continue
unremedied for a period of three Business Days;
(c) any representation or warranty made or deemed made by or on
behalf of any Obligor in or in connection with this Agreement or any other
Loan Document or any amendment or modification hereof or thereof, or in any
report, certificate, financial statement or other document furnished
pursuant to or in connection with this Agreement or any other Loan Document
or any amendment or modification hereof or thereof, shall prove to have
been incorrect when made or deemed made in any material respect; or any
representation or warranty made by or on behalf of Hearst in the Merger
Agreement shall prove to have been incorrect when made in any material
respect;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 6.02, 6.03 (with respect to the
Borrower's existence), 6.08 or 6.09 or in Article VII;
(e) any Obligor shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement (other than those
specified in clause (a), (b) or (d) of this Article) or any other Loan
Document and such failure shall continue unremedied for a period of 30 or
more days after notice thereof from the Administrative Agent (given at the
request of any Lender) is received by the Borrower;
(f) the Borrower or any of its Consolidated Subsidiaries shall fail
to make any payment (whether of principal or interest and regardless of
amount) in respect of any Material Indebtedness, when and as the same shall
become due and payable;
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables
or permits (with or
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without the giving of notice, the lapse of time or both) the holder or
holders of any Material Indebtedness or any trustee or agent on its or
their behalf to cause any Material Indebtedness to become due, or to
require the prepayment, repurchase, redemption or defeasance thereof, prior
to its scheduled maturity; provided that this clause (g) shall not apply to
--------
the offer to repurchase the Senior Subordinated Notes as a result of the
Merger Transactions or to secured Indebtedness that becomes due as a result
of the voluntary sale or transfer of the property or assets securing such
Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of any Obligor or its debts, or of a substantial part of
its assets, under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect or (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for any Obligor or for a substantial part of its assets,
and, in any such case, such proceeding or petition shall continue
undismissed for 60 days or an order or decree approving or ordering any of
the foregoing shall be entered;
(i) any Obligor shall (i) voluntarily commence any proceeding or file
any petition seeking liquidation, reorganization or other relief under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar
law now or hereafter in effect, (ii) consent to the institution of, or fail
to contest in a timely and appropriate manner, any proceeding or petition
described in clause (h) of this Article, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for any Obligor or for a substantial part of its assets,
(iv) file an answer admitting the material allegations of a petition filed
against it in any such proceeding, (v) make a general assignment for the
benefit of creditors or (vi) take any action for the purpose of effecting
any of the foregoing;
(j) any Obligor shall become unable, admit in writing its inability
or fail generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $25,000,000 shall be rendered against any Obligor or
any combination thereof and the same shall remain undischarged for a period
of 30 consecutive days during which execution shall not be effectively
stayed, or any action shall be legally taken by a judgment creditor to
attach or levy upon any assets of any Obligor to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the reasonable
judgment of the Required Lenders, when taken together with all other ERISA
Events that have occurred, could reasonably be expected to result in a
Material Adverse Effect;
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(m) a reasonable basis shall exist for the assertion against the
Borrower or any of its Subsidiaries, or any predecessor in interest of the
Borrower or any of its Subsidiaries or Affiliates, of (or there shall have
been asserted against the Borrower or any of its Subsidiaries) any claims
or liabilities, whether accrued, absolute or contingent, based on or
arising from the generation, storage, transport, handling or disposal of
Hazardous Materials by the Borrower or any of its Subsidiaries, Affiliates
or predecessors that, in the reasonable judgment of the Required Lenders,
are reasonably likely to be determined adversely to the Borrower or any of
its Subsidiaries, and the amount thereof (either individually or in the
aggregate) is reasonably likely to have a Material Adverse Effect (insofar
as such amount is payable by the Borrower or any of its Consolidated
Subsidiaries but after deducting any portion thereof that is reasonably
expected to be paid by other creditworthy Persons jointly and severally
liable therefor);
(n) a Change of Control shall occur; or
(o) the principal broadcasting licenses of any Station, or any other
material authorizations, licenses or permits issued by the FCC, shall be
revoked or canceled or expire by their terms and not be renewed, or shall
be modified in a manner materially adverse to the Borrower or the
respective Consolidated Subsidiary operating such Station;
then, and in every such event (other than an event with respect to any Obligor
described in clause (i) or (j) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times:
(i) terminate the Commitments, and thereupon the Commitments
shall terminate immediately, and
(ii) declare the Loans then outstanding to be due and payable in
whole (or in part, in which case any principal not so declared to be due
and payable may thereafter be declared to be due and payable), and
thereupon the principal of the Loans so declared to be due and payable,
together with accrued interest thereon and all fees and other obligations
of the Obligors accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by each Obligor;
and in case of any event with respect to any Obligor described in clause (h) or
(i) of this Article, the Commitments shall automatically terminate and the
principal of the Loans then outstanding, together with accrued interest thereon
and all fees and other obligations of the Obligors accrued hereunder, shall
automatically become due and payable, without
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presentment, demand, protest or other notice of any kind, all of which are
hereby waived by each Obligor.
ARTICLE IX
THE ADMINISTRATIVE AGENT
Each of the Lenders and the Issuing Lender hereby irrevocably appoints
the Administrative Agent as its agent hereunder and under the other Loan
Documents and authorizes the Administrative Agent to take such actions on its
behalf and to exercise such powers as are delegated to the Administrative Agent
by the terms hereof or thereof, together with such actions and powers as are
reasonably incidental thereto.
The Person serving as the Administrative Agent hereunder shall have
the same rights and powers in its capacity as a Lender as any other Lender and
may exercise the same as though it were not the Administrative Agent, and such
Person and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of business with the Borrower or any Subsidiary or other
Affiliate thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations
except those expressly set forth herein and in the other Loan Documents.
Without limiting the generality of the foregoing, (a) the Administrative Agent
shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing, (b) the Administrative Agent
shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that the Administrative Agent
is required to exercise in writing by the Required Lenders, and (c) except as
expressly set forth herein and in the other Loan Documents, the Administrative
Agent shall not have any duty to disclose, and shall not be liable for the
failure to disclose, any information relating to the Borrower or any of its
Subsidiaries that is communicated to or obtained by the bank serving as
Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Required Lenders or in the absence of
its own gross negligence or wilful misconduct. The Administrative Agent shall
be deemed not to have knowledge of any Default unless and until written notice
thereof is given to the Administrative Agent by the Borrower or a Lender, and
the Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in
or in connection with this Agreement or any other Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or therein, (iv) the validity, enforceability, effectiveness or
genuineness of this Agreement, any other Loan Document or any other agreement,
instrument or document, or (v) the
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satisfaction of any condition set forth in Article V or elsewhere herein or
therein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.
The Administrative Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to be made by the proper Person, and shall not incur any liability for
relying thereon. The Administrative Agent may consult with legal counsel (who
may be counsel for an Obligor), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it
in accordance with the advice of any such counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent may
resign at any time by notifying the Lenders, the Issuing Lender and the
Borrower. Upon any such resignation, the Required Lenders shall have the right,
in consultation with the Borrower, to appoint a successor. If no successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent gives
notice of its resignation, then the retiring Administrative Agent may, on behalf
of the Lenders and the Issuing Lender, appoint a successor Administrative Agent
which shall be a bank with an office in New York, New York, or an Affiliate of
any such bank. Upon the acceptance of its appointment as Administrative Agent
hereunder by a successor, such successor shall succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder. The fees payable by the Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrower and such successor (and, as
provided in Section 2.11(c), the retiring Administrative Agent shall make
available to the Borrower a ratable portion of any fees theretofore paid to the
Administrative Agent for the period during which the resignation or removal of
such retiring Administrative Agent shall occur to the extent the Borrower is
required to pay fees for the balance of such period to the successor
Administrative Agent). After the Administrative Agent's resignation hereunder,
the provisions of this Article and Section 10.03 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 Administrative Agent.
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Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document or any related agreement or any document furnished
hereunder or thereunder.
Except as otherwise provided in Section 10.02(b) with respect to this
Agreement, the Administrative Agent may, with the prior consent of the Required
Lenders (but not otherwise), consent to any modification, supplement or waiver
under any of the Loan Documents.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Notices. Except in the case of notices and other
-------
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower or any Subsidiary Guarantor, to it c/o Hearst-
Argyle Television, Inc. at 000 0xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention of Xxxxx X. Xxxxx (Telecopy No. 212-765-9639);
(b) if to the Administrative Agent, to The Chase Manhattan Bank, 1
Chase Xxxxxxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention Loan
and Agency Services Group (Telecopy No. (000) 000-0000), with a copy to The
Chase Manhattan Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention
of Xxxxxxxx Xxxxxx (Telecopy No. 212-270-4584);
(c) if to the Issuing Lender, to it at The Chase Manhattan Bank,
Trade Services, 00 Xxxxx Xxxxxx, Xxxx 0000, Xxx Xxxx, Xxx Xxxx 00000,
Attention of Xxxxxx Xxxxxx, Assistant Manager (Telecopy No. 212-638-8200);
and
(d) if to a Lender (including any Lender in its capacity as a
Swingline Lender), to it at its address (or telecopy number) set forth in
its Administrative Questionnaire.
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Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.
SECTION 10.02. Waivers; Amendments.
-------------------
(a) No Deemed Waivers; Remedies Cumulative. No failure or delay by
--------------------------------------
the Administrative Agent, the Issuing Lender or any Lender in exercising any
right or power hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The
rights and remedies of the Administrative Agent, the Issuing Lender and the
Lenders hereunder are cumulative and are not exclusive of any rights or remedies
that they would otherwise have. No waiver of any provision of this Agreement or
consent to any departure by any Obligor therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of this Section,
and then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not be
construed as a waiver of any Default, regardless of whether the Administrative
Agent, any Lender or the Issuing Lender may have had notice or knowledge of such
Default at the time.
(b) Amendments. Neither this Agreement nor any provision hereof may
----------
be waived, amended or modified except pursuant to an agreement or agreements in
writing entered into by the Borrower and the Required Lenders or by the Borrower
and the Administrative Agent with the consent of the Required Lenders; provided
--------
that no such agreement shall (i) increase any Commitment of any Lender without
the written consent of such Lender, (ii) reduce the principal amount of any Loan
or LC Disbursement or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iii) postpone the scheduled date of payment of the principal amount of any Loan
or LC Disbursement, or any interest thereon, or any fees payable hereunder, or
reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of any reduction or expiration of any Commitment, without the
written consent of each Lender affected thereby, (iv) change Section 2.17(b) or
(d) in a manner that would alter the pro rata sharing of payments required
thereby, without the written consent of each Lender, (v) change any of the
provisions of this Section or the definition of the term "Required Incremental
Facility Lenders", "Required Lenders", "Required Revolving Lenders" or "Required
Term Lenders" or any other provision hereof specifying the number or percentage
of Lenders required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, without the written consent of
each Lender, or (vi) except as otherwise provided herein, release any Subsidiary
Guarantor from any of its guarantee obligations under Article III without the
written consent of each Lender; and provided further that (x) no such agreement
-------- -------
shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent, the Issuing Lender or either Swingline Lender
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hereunder without the prior written consent of the Administrative Agent, the
Issuing Lender or such Swingline Lender, as the case may be and (y) any
modification or supplement of Article III shall require the consent of each
Subsidiary Guarantor.
Anything in this Agreement to the contrary notwithstanding, (A) no
waiver or modification of any provision of this Agreement that has the effect
(either immediately or at some later time) of enabling the Borrower to satisfy a
condition precedent to the making of a Revolving Loan, or Incremental Facility
Loans of any Series, shall be effective against the Revolving Lenders or
Incremental Facility Lenders of such Series, as the case may be, for purposes of
the Revolving Commitments or Incremental Facility Commitments of such Series
unless the Required Revolving Lenders or Required Incremental Facility Lenders
of such Series, as applicable, shall have concurred with such waiver or
modification and (B) upon the sale, transfer or other disposition of any
Subsidiary Guarantor hereunder in a transaction permitted under Section 7.03 (or
to which the Required Lenders shall have consented), the Administrative Agent is
authorized and instructed to enter into an amendment to this Agreement releasing
such Subsidiary Guarantor from its Guarantee under Article III.
SECTION 10.03. Expenses; Indemnity; Damage Waiver.
----------------------------------
(a) Costs and Expenses. The Borrower shall pay (i) all reasonable
------------------
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent, in connection with the syndication of the credit
facilities provided for herein, the preparation of this Agreement and the other
Loan Documents or any amendments, modifications or waivers of the provisions
hereof or thereof (whether or not the transactions contemplated hereby or
thereby shall be consummated), (ii) all out-of-pocket expenses incurred by the
Issuing Lender in connection with the issuance, amendment, renewal or extension
of any Letter of Credit or any demand for payment thereunder and (iii) all out-
of-pocket expenses incurred by the Administrative Agent, the Issuing Lender or
any Lender, including the fees, charges and disbursements of any counsel for the
Administrative Agent, the Issuing Lender or any Lender, in connection with the
enforcement or protection of its rights in connection with this Agreement and
the other Loan Documents, including its rights under this Section, or in
connection with the Loans made or Letters of Credit issued hereunder, including
in connection with any workout, restructuring or negotiations in respect
thereof.
(b) Indemnification by Borrower. The Borrower shall indemnify the
---------------------------
Administrative Agent, the Issuing Lender and each Lender, and each Related Party
of any of the foregoing Persons (each such Person being called an "Indemnitee")
----------
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the fees, charges and
disbursements of any counsel for any Indemnitee, incurred by or asserted against
any Indemnitee arising out of, in connection with, or as a result of (i) the
execution or delivery of this Agreement or any agreement or instrument
contemplated hereby, the performance by the parties hereto of their respective
obligations hereunder or the consummation of the Transactions or any other
transactions contemplated
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hereby, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom
(including any refusal by the Issuing Lender to honor a demand for payment under
a Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (iii) any actual
or alleged presence or release of Hazardous Materials on or from any property
owned or operated by the Borrower or any of its Subsidiaries, or any
Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee, be available to
--------
the extent that such losses, claims, damages, liabilities or related expenses
resulted from the gross negligence or wilful misconduct of such Indemnitee.
(c) Reimbursement by Lenders. To the extent that the Borrower fails
------------------------
to pay any amount required to be paid by it to the Administrative Agent, the
Issuing Lender or either Swingline Lender under paragraph (a) or (b) of this
Section, each Lender severally agrees to pay to the Administrative Agent, the
Issuing Lender or such Swingline Lender, as the case may be, such Lender's
Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount;
provided that the unreimbursed expense or indemnified loss, claim, damage,
--------
liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent, the Issuing Lender or such Swingline Lender in
its capacity as such.
(d) Waiver of Consequential Damages, Etc. To the extent permitted by
------------------------------------
applicable law, no Obligor shall assert, and each Obligor hereby waives, any
claim against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit or the use of the proceeds thereof.
(e) Payments. All amounts due under this Section shall be payable
--------
promptly after written demand therefor.
SECTION 10.04. Successors and Assigns.
----------------------
(a) Assignments Generally. The provisions of this Agreement shall be
---------------------
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that no Obligor may assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by any
Obligor without such consent shall be null and void). Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the parties hereto, their respective successors and assigns
permitted hereby and, to the extent expressly contemplated hereby, the Related
Parties of each of the Administrative Agent, the Issuing Lender and the Lenders)
any legal or equitable right, remedy or claim under or by reason of this
Agreement.
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(b) Assignments by Lenders. Any Lender may assign to one or more
----------------------
assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitments and the Loans at the time owing
to it); provided that
--------
(i) except in the case of an assignment to a Lender or an
Affiliate of a Lender, each of the Borrower and the Administrative Agent
(and, in the case of an assignment of all or a portion of a Commitment or
any Lender's obligations in respect of its LC Exposure or Swingline
Exposure, the Issuing Lender and each Swingline Lender) must give their
prior written consent to such assignment (which consent shall not be
unreasonably withheld),
(ii) except in the case of an assignment to a Lender or an
Affiliate of a Lender or an assignment of the entire remaining amount of
the assigning Lender's Commitment(s), the amount of the Commitment(s) of
the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Acceptance with respect to such assignment is
delivered to the Administrative Agent) shall not be less than $5,000,000
unless each of the Borrower and the Administrative Agent otherwise consent,
(iii) each partial assignment of the Loans, LC Exposure or
Commitments of any Class shall be made as an assignment of a proportionate
part of all the assigning Lender's rights and obligations under this
Agreement in respect of such Class,
(iv) the assignor and the assignee to each assignment shall
execute and deliver to the Administrative Agent an Assignment and
Acceptance, together with a processing and recordation fee of $3,500, and
(v) the assignee, if it shall not be a Lender, shall deliver to
the Administrative Agent an Administrative Questionnaire;
provided further that any consent of the Borrower otherwise required under this
-------- -------
paragraph shall not be required if an Event of Default under clause (i) or (j)
of Article VIII has occurred and is continuing. Upon acceptance and recording
pursuant to paragraph (d) of this Section, from and after the effective date
specified in each Assignment and Acceptance, the assignee thereunder shall be a
party hereto and, to the extent of the interest assigned by such Assignment and
Acceptance, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Acceptance, be released from its obligations
under this Agreement (and, in the case of an Assignment and Acceptance covering
all of the assigning Lender's rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.14, 2.15, 2.16 and 10.03). Any assignment or transfer by
a Lender of rights or obligations under this Agreement that does not comply with
this paragraph shall be treated for purposes of this Agreement as a sale by such
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Lender of a participation in such rights and obligations in accordance with
paragraph (e) of this Section.
(c) Maintenance of Register by Administrative Agent. The
-----------------------------------------------
Administrative Agent, acting for this purpose as an agent of the Borrower, shall
maintain at one of its offices in The City of New York a copy of each Assignment
and Acceptance delivered to it and a register for the recordation of the names
and addresses of the Lenders, and the Commitments of, and principal amount of
the Loans and LC Disbursements owing to, each Lender pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be
--------
conclusive, and the Borrower, the Administrative Agent, the Issuing Lender and
the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, the Issuing Lender and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(d) Effectiveness of Assignments. Upon its receipt of a duly
----------------------------
completed Assignment and Acceptance executed by an assigning Lender and an
assignee, the assignee's completed Administrative Questionnaire (unless the
assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this Section and any written consent to such
assignment required by paragraph (b) of this Section, the Administrative Agent
shall accept such Assignment and Acceptance and record the information contained
therein in the Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this
paragraph.
(e) Participations. Any Lender may, without the consent of the
--------------
Borrower, the Administrative Agent, the Issuing Lender or either Swingline
Lender, sell participations to one or more banks or other entities (a
"Participant") in all or a portion of such Lender's rights and obligations under
------------
this Agreement and the other Loan Documents (including all or a portion of its
Commitments and the Loans owing to it); provided that (i) such Lender's
--------
obligations under this Agreement and the other Loan Documents shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) the Borrower, the
Administrative Agent, the Issuing Lender and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement and the other Loan Documents. Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and the other Loan Documents and to approve any amendment,
modification or waiver of any provision of this Agreement or any other Loan
Document; provided that such agreement or instrument may provide that such
--------
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 10.02(b) that
affects such Participant. Subject to paragraph (f) of this Section, the
Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.14, 2.15 and 2.16 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section.
-99-
(f) Limitations on Rights of Participants. A Participant shall not
-------------------------------------
be entitled to receive any greater payment under Section 2.14 or 2.16 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower's prior written consent. A
Participant that would be a Foreign Lender if it were a Lender shall not be
entitled to the benefits of Section 2.16 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of the Borrower, to comply with Section 2.16(e) as though it were a
Lender, provided that in no event shall the Borrower be required to pay a
--------
greater sum to such Participant than it would have been required to pay to the
Lender from which such Participant acquired such participation.
(g) Pledges. Any Lender may at any time pledge or assign a security
-------
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any such pledge or assignment to a Federal
Reserve Bank, and this Section shall not apply to any such pledge or assignment
of a security interest; provided that no such pledge or assignment of a security
--------
interest shall release a Lender from any of its obligations hereunder or
substitute any such assignee for such Lender as a party hereto.
(h) No Assignments to Obligors or Affiliates. Anything in this
----------------------------------------
Section 10.04 to the contrary notwithstanding, no Lender may assign or
participate any interest in any Loan or LC Exposure held by it hereunder to the
Borrower or any of its Affiliates or Subsidiaries without the prior consent of
each Lender.
SECTION 10.05. Survival. All covenants, agreements, representations
--------
and warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any Loans
and issuance of any Letters of Credit, regardless of any investigation made by
any such other party or on its behalf and notwithstanding that the
Administrative Agent, the Issuing Lender or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any
credit is extended hereunder, and shall continue in full force and effect so
long as the principal of or any accrued interest on any Loan or any fee or any
other amount payable under this Agreement is outstanding and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated. The provisions of Sections 2.14, 2.15, 2.16, 3.03 and 10.03 and
Article IX shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.
SECTION 10.06. Counterparts; Integration; Effectiveness. This
----------------------------------------
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement
and any separate letter agreements with respect to fees payable to the
Administrative Agent constitute the entire contract among the parties
-100-
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 5.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts hereof which, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed
counterpart of a signature page of this Agreement by telecopy shall be effective
as delivery of a manually executed counterpart of this Agreement.
SECTION 10.07. Severability. Any provision of this Agreement held to
------------
be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 10.08. Right of Setoff. If an Event of Default shall have
---------------
occurred and be continuing, each Lender 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 Lender to or
for the credit or the account of any Obligor against any of and all the
obligations of any Obligor now or hereafter existing under this Agreement held
by such Lender, irrespective of whether or not such Lender shall have made any
demand under this Agreement and although such obligations may be unmatured. The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.
SECTION 10.09. Governing Law; Jurisdiction; Consent to Service of
--------------------------------------------------
Process.
-------
(a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York.
(b) Each Obligor hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of the Supreme Court
of the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such New
York State or, to the extent permitted by law, in such Federal court. Each of
the parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement
shall affect any right that the Administrative Agent, the Issuing Lender or
-101-
any Lender may otherwise have to bring any action or proceeding relating to this
Agreement against any Obligor or its properties in the courts of any
jurisdiction.
(c) Each Obligor hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any court referred to
in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 10.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 10.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
--------------------
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 10.11. Headings. Article and Section headings and the Table
--------
of Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 10.12. Treatment of Certain Information; Confidentiality.
-------------------------------------------------
(a) Treatment of Certain Information. The Borrower acknowledges that
--------------------------------
from time to time financial advisory, investment banking and other services may
be offered or provided to the Borrower or one or more of its Subsidiaries (in
connection with this Agreement or otherwise) by any Lender or by one or more
subsidiaries or affiliates of such Lender and the Borrower hereby authorizes
each Lender to share any information delivered to such Lender by the Borrower
and its Subsidiaries pursuant to this Agreement, or in connection with the
decision of such Lender to enter into this Agreement, to any such subsidiary or
affiliate for the purpose of using the same in connection with such services.
-102-
(b) Confidentiality. Each of the Administrative Agent, the Issuing
---------------
Lender and the Lenders agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or under any other Loan Document or any suit, action or
proceeding relating to this Agreement or any other Loan Document or the
enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to any
assignee of or Participant in, or any prospective assignee of or Participant in,
any of its rights or obligations under this Agreement, (g) with the consent of
the Borrower or (h) to the extent such Information (i) becomes publicly
available other than as a result of a breach of this Section or (ii) becomes
available to the Administrative Agent, the Issuing Lender or any Lender on a
nonconfidential basis from a source other than an Obligor. For the purposes of
this Section, "Information" means all information received from any Obligor
-----------
relating to any Obligor or its business, other than any such information that is
available to the Administrative Agent, the Issuing Lender or any Lender on a
nonconfidential basis prior to disclosure by an Obligor; provided that, in the
--------
case of information received from an Obligor after the date hereof, such
information is clearly identified at the time of delivery as confidential.
Unless specifically prohibited by applicable law or court order, each Lender and
the Administrative Agent shall, prior to disclosure thereof, notify the Borrower
of any request for disclosure of any such non-public information (A) by any
governmental agency or representative thereof (other than any such request in
connection with an examination of the financial condition of such Lender by such
governmental agency) or (B) pursuant to legal process (including agency
subpoenas). Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.
-103-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
ARGYLE TELEVISION, INC. (to be
renamed HEARST-ARGYLE TELEVISION, INC.,
following the Merger Transactions referred to
herein)
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
SUBSIDIARY GUARANTORS
---------------------
ARKANSAS ARGYLE TELEVISION, INC. (to be
renamed ARKANSAS HEARST-ARGYLE TELEVISION, INC.,
following the Merger Transactions referred to
herein)
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
-104-
HAWAII ARGYLE TELEVISION, INC. (to be
renamed HAWAII HEARST-ARGYLE
TELEVISION, INC., following the Merger
Transactions referred to herein)
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
XXXXXXX ARGYLE TELEVISION, INC. (to be
renamed XXXXXXX HEARST-ARGYLE
TELEVISION, INC., following the Merger
Transactions referred to herein)
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
-105-
OHIO/OKLAHOMA ARGYLE TELEVISION, INC.
(to be renamed OHIO/OKLAHOMA
HEARST-ARGYLE TELEVISION, INC.,
following the Merger Transactions
referred to herein)
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
HEARST-ARGYLE STATIONS, INC
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
WAPT ARGYLE TELEVISION, INC.
(to be renamed WAPT
HEARST-ARGYLE TELEVISION, INC.,
following the Merger Transactions
referred to herein)
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
KITV ARGYLE TELEVISION, INC.
(to be renamed KITV
HEARST-ARGYLE TELEVISION, INC.,
following the Merger Transactions
referred to herein)
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
-106-
KHBS ARGYLE TELEVISION, INC.
(to be renamed KHBS
HEARST-ARGYLE TELEVISION, INC.,
following the Merger Transactions
referred to herein)
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
KMBC HEARST-ARGYLE TELEVISION, INC
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
WBAL HEARST-ARGYLE TELEVISION, INC
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
WCVB HEARST-ARGYLE TELEVISION, INC
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
-107-
WISN HEARST-ARGYLE TELEVISION, INC
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
WTAE HEARST-ARGYLE TELEVISION, INC
By /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer,
Assistant Secretary & Treasurer
-108-
LENDERS
-------
THE CHASE MANHATTAN BANK,
individually, as Swingline Lender and as
Administrative Agent
By /s/ Xxxxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Vice President
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK, individually, as Swingline Lender
and as Documentation Agent
By /s/ Xxxx X. Silver
----------------------------------------
Name: Xxxx X. Silver
Title: Associate
BANK OF MONTREAL
By: /s/ X. X. Xxxxxx
---------------------------------------
Name: X. X. Xxxxxx
Title: Director, Head of Financing
THE BANK OF NEW YORK
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
BANQUE PARIBAS
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Director
By: /s/ Xxxx Aizenberg
---------------------------------------
Name: Xxxx Xxxxxxxxx
Title: Vice President
-109-
TORONTO DOMINION (TEXAS), INC.
By: /s/ Xxxxxxxx Xxxxxx
--------------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Vice President
UNION BANK OF CALIFORNIA, N.A.
By: /s/ Xxxxx X. Xxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
CAISSE NATIONALE DE CREDIT
AGRICOLE
By: /s/ R. Xxxxx Xxxxx
--------------------------------------
Name: R. Xxxxx Xxxxx
Title: First Vice President
THE DAI-ICHI KANGYO BANK, LTD.
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
WACHOVIA BANK, N.A.
By: /s/ Xxxx X. Xxxxxxxxx
--------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Senior Vice President
-110-
THE BANK OF NOVA SCOTIA
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Authorized Signatory
FIRST HAWAIIAN BANK
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Assistant Vice President
THE MITSUBISHI TRUST AND
BANKING CORPORATION
By: /s/ Xxxxxxxxx Xxxxxxx
---------------------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Senior Vice President
THE SANWA BANK LIMITED
By: /s/ Xxxx Xxxxxxx
---------------------------------------
Name: Xxxx Xxxxxxx
Title: Vice President
SUNTRUST BANK, CENTRAL FLORIDA,
N.A.
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
-111-
THE TOYO TRUST & BANKING COMPANY,
LTD.
By: /s/ T. Mikumo
------------------------------
Name: T. Mikumo
Title: Vice President
MICHIGAN NATIONAL BANK
By: /s/ Xxxxxxxx X. Xxxxx
------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Relationship Manager
SCHEDULE I
Commitments
[See definitions of "Lenders" and "Revolving
Commitment" in Section 1.01]
Revolving Commitment Lenders
-------------------- -------
$180,000,000.00 The Chase Manhattan Bank
$145,000,000.00 Xxxxxx Guaranty Trust Company of New York
$ 75,000,000.00 Bank of Montreal
$ 75,000,000.00 The Bank of New York
$ 75,000,000.00 Banque Paribas
$ 75,000,000.00 Toronto Dominion (Texas), Inc.
$ 75,000,000.00 Union Bank of California, N.A.
$ 50,000,000.00 Caisse Nationale de Credit Agricole
$ 50,000,000.00 The Dai-Ichi Kangyo Bank, Ltd.
$ 50,000,000.00 Wachovia Bank, N.A.
$ 25,000,000.00 The Bank of Nova Scotia
$ 25,000,000.00 First Hawaiian Bank
$ 25,000,000.00 The Mitsubishi Trust and Banking Corporation
$ 25,000,000.00 The Sanwa Bank Limited
$ 25,000,000.00 SunTrust Bank, Central Florida, N.A.
$ 15,000,000.00 The Toyo Trust & Banking Company, Ltd.
$ 10,000,000.00 Michigan National Bank
Schedule I to Credit Agreement
------------------------------
SCHEDULE II
Material Agreements and Liens with Respect to Indebtedness
----------------------------------------------------------
[See Section 4.13, Section 5.01(f),
Section 7.01(b) and Section 7.02(b)]
Part A - Material Agreements
-------------------
DESCRIPTION AGGREGATE PRINCIPAL
----------- AMOUNT OUTSTANDING
-----------------------
Amended and Restated Credit Agreement dated as of June 13, 1995 between Maximum principal
the Borrower, each of the subsidiaries of the Borrower named therein (the amount of $215,000,000
"Existing Loan Subsidiaries"), the lenders named therein, The Chase Manhattan of which $48,000,000
Bank (successor to The Chase Manhattan Bank (National Association)) as was outstanding as of
administrative agent for said lenders, and Bank of Montreal, Banque Paribas 8/25/97
and Union Bank as co-agents (as modified, amended and restated and (To be paid in full
supplemented and in effect on the Effective Date) (the "Existing Credit on the Effective Date)
---------------
Agreement").
----------
Indenture dated as of October 27, 1995, as supplemented, between the $150,000,000
---------
Borrower and the United States Trust Company of New York, as trustee,
pursuant to which the Borrower issued its 9 3/4% Senior Subordinated Notes
due 2005.
Condominium Purchase Agreement entered into in February 1996 between the $ 7,414,400
------------------------------
Borrower and an affiliate of The Xxxxxx Corporation ("Xxxxxx") for the
------
purchase of space in a project being developed by Xxxxxx. This space is to
become the new facility for the Borrower's KITV-TV. Under the
Condominium Purchase Agreement, the Borrower is obligated to make
payments to Xxxxxx totaling $9,268,000, $7,414,400 of which will become
payable at closing under the Condominium Purchase Agreement. In connection
with this project, the Borrower has also entered into certain other agreements
for the finish-out and equipment of this facility, obligating the Borrower to
expend approximately an additional $1,400,000, which amount will be paid
during the fourth quarter of 1997 and the first two quarters of 1998.
Assignment, Assumption and Modification Agreement dated as of August 29, $275,000,000
-------------------------------------------------
1997 among Hearst, the Borrower, Metropolitan Life Insurance Company
("MetLife") and The Prudential Insurance Company of America ("Prudential")
pursuant to which the Borrower has (i) entered into the Amended and Restated
Note Purchase Agreement, dated as of August 29, 1997 (the "Note Purchase
-------------
Agreement"), among the Borrower, MetLife and Prudential, and (ii) executed
---------
the 7.87% Series A Senior Note due 2001, the 8.01% Series B Senior Notes
due 2002 and the 8.04% Series C Senior Note due 2003 issued pursuant to the
Note Purchase Agreement.
Demand Promissory Note dated as of August 29, 1997 made by HAT
---------------------- 200,000,000
Contribution Sub, Inc. and payable to the order of The Chase Manhattan Bank, (To be paid in full
which was assumed by the Borrower pursuant to the assumption provision set on the Effective Date)
forth therein.
Schedule II to Credit Agreement
-------------------------------
-2-
Part B - Liens
-----
Although substantially all of the assets of the Borrower and the Existing
Loan Subsidiaries were pledged or mortgaged as collateral under the Existing
Credit Agreement, all of such liens and security interests are intended to be
released on the Effective Date.
The Bridge Debt will be secured by the cash proceeds thereof; the
security interest will be released upon repayment of the Bridge Debt on the
Effective Date.
Schedule II to Credit Agreement
-------------------------------
SCHEDULE III
Litigation and Environmental Matters
------------------------------------
[See definition of "Disclosed Matters" in Section 1.01]
Litigation
----------
None.
Environmental Matters
---------------------
None.
Schedule III to Credit Agreement
--------------------------------
SCHEDULE IV
Subsidiaries and Investments
----------------------------
[See Section 4.15 and 7.05]
Part A - Subsidiaries
------------
Subsidiary State of Incorporation
---------- ----------------------
Arkansas Hearst-Argyle Television, Inc. Delaware
Hawaii Hearst-Argyle Television, Inc. Delaware
Xxxxxxx Hearst-Argyle Television, Inc. Delaware
Ohio/Oklahoma Hearst-Argyle Television, Inc. Nevada
Hearst-Argyle Stations, Inc. Nevada
WAPT Hearst-Argyle Television, Inc. Nevada
KITV Hearst-Argyle Television, Inc. Nevada
KHBS Hearst-Argyle Television, Inc. Nevada
KMBC Hearst-Argyle Television, Inc. Nevada
WBAL Hearst-Argyle Television, Inc. Nevada
WCVB Hearst-Argyle Television, Inc. Nevada
WISN Hearst-Argyle Television, Inc. Nevada
WTAE Hearst-Argyle Television, Inc. Nevada
Part B - Investments
-----------
Holder of Investment Nature of Investment
-------------------- --------------------
Argyle Television, Inc. An investment in common stock of Affiliated
Enterprises, Inc., a corporation sponsored by
America Broadcasting Company, Inc. ("ABC") and
of which all stockholders are ABC affiliates.
Affiliated Enterprises, Inc. is investigating
new broadcast technologies.
KHBS Argyle Television, Forty-nine percent (49%) of the issued and
Inc. outstanding common stock of Harrison Television,
Inc., which is an applicant for a FCC license to
broadcast in the Harrison, Arkansas area.
Schedule IV to Credit Agreement
-------------------------------
SCHEDULE V
Station Licenses
----------------
[See Section 4.16 and Section 5.01(g)]
KMBC HEARST-ARGYLE TELEVISION, INC.
Call Sign Type
--------- ----
KMBC Main
WHY-779 TV auxiliary
WHY-780 TV auxiliary
WHY-781 TV auxiliary
WCD-733 TV auxiliary
WCD-734 TV auxiliary
KZ-2685 Remote Pickup
KZ-2686 Remote Pickup
KZ-2687 Remote Pickup
KC-5476 Remote Pickup
KEH-381 Remote Pickup
KPE-669 Remote Pickup
KCI-998 Remote Pickup
WBAL HEARST-ARGYLE TELEVISION, INC.
Call Sign Type
--------- ----
WBAL-TV Main
WZB-677 TV auxiliary
WZB-678 TV auxiliary
WZB-679 TV auxiliary
KEH-561 Remote Pickup
KZH-878 Remote Pickup
KA88745 TV auxiliary
KB55004 TV auxiliary
KW4042 TV auxiliary
KR9984 TV auxiliary
KB96899 Remote Pickup
KZH-895 Remote Pickup
WLI-958 TV auxiliary
KA-21745 TV auxiliary
WLP-530 Relay
KPH-217 Relay
KPH-218 Relay
KB-96899 Remote Pickup
Schedule V to Credit Agreement
------------------------------
-0-
XXXX XXXXXX-XXXXXX TELEVISION, INC.
Call Sign Type
--------- ----
WCVB Main
800909MK TV auxiliary
BLQ-304 TV auxiliary
KR-4778 Remote Pickup
KR-5551 Remote Pickup
KR-5550 Remote Pickup
BLP00720 TV auxiliary
BLQ-337 TV auxiliary
KPE-562 Remote Pickup
KTE-753 TV auxiliary
KYY-288 Remote Pickup
KPF-325 Remote Pickup
KKN-760 Remote Pickup
KTE-752 Remote Pickup
KO-5245 TV auxiliary
KQ-4638 TV auxiliary
KR-5541 TV auxiliary
KS-2476 TV auxiliary
KV-4915 TV auxiliary
BLP-01087 TV auxiliary
BLQ-790227ME TV auxiliary
KA-2007 TV auxiliary
KA-2008 TV auxiliary
KA-40608 TV auxiliary
KA-40534 TV auxiliary
KA-95344 TV auxiliary
KA-95345 TV auxiliary
KA-95346 TV auxiliary
KB-55987 TV auxiliary
KB-1749 TV auxiliary
KC-4973 TV auxiliary
KC-4977 TV auxiliary
WLD-65 TV auxiliary
KR-9742 TV auxiliary
KV-3059 TV auxiliary
WHY-437 TV auxiliary
WHS-688 TV auxiliary
WLD-702 TV auxiliary
Schedule V to Credit Agreement
------------------------------
-3-
WHS-687 TV auxiliary
KA-2009 TV auxiliary
WHB-262 TV auxiliary
WHS-374 TV auxiliary
WCG-783 TV auxiliary
K5-5551 TV auxiliary
KV-3061 TV auxiliary
WHB-263 TV auxiliary
WHB-264 TV auxiliary
WHS-238 TV auxiliary
WHS-686 TV auxiliary
WIL75 TV auxiliary
WDD690 TV auxiliary
KY5603 TV auxiliary
KA-88791 TV auxiliary
KA-88793 TV auxiliary
KA-88792 TV auxiliary
WLE-632 TV auxiliary
WTAE HEARST-ARGYLE TELEVISION, INC.
Call Sign Type
--------- ----
WTAE-TV Main
KZH-868 (BMLRE-830418MH) TV auxiliary
KZH-868 (BPLRE-830418MH) TV auxiliary
KZH-868 (BMLRE-841017MM) Remote Pickup
KZH-868 (BPLRE-860919MG) TV auxiliary
KPE-651 Remote Pickup
KE-5822 Remote Pickup
KA-74922 TV auxiliary
WBG-587 TV auxiliary
KGL-96 TV auxiliary
KW-4093 TV auxiliary
KA-74908 TV auxiliary
WHY-881 TV auxiliary
KW-4094 TV auxiliary
KE-5824 TV auxiliary
KA88617 Remote Pickup
KJH322 Remote Pickup
KPM417 Remote Pickup
KWU56 Remote Pickup
Schedule V to Credit Agreement
------------------------------
-4-
WZB718 Remote Pickup
WZB719 Remote Pickup
XXXX-000000XX Wireless microphone
XXXX-000000XX Wireless microphone
BLQ-791017MG Wireless microphone
WMW-748 TV auxiliary
WISN HEARST-ARGYLE TELEVISION, INC.
Call Sign Type
--------- ----
XXXX-XX Xxxx
XXX00 Xxxxx
XX-00000 Remote Pickup
KPJ-265 Remote Pickup
KZH-839 Remote Pickup
KE-5738 TV auxiliary
KA-88867 TV auxiliary
KU-3779 TV auxiliary
WJJ-70 TV auxiliary
KX-3707 TV auxiliary
KX-3708 TV auxiliary
KX-3709 TV auxiliary
WHQ-248 TV auxiliary
WHY-410 TV auxiliary
WHY-801 TV auxiliary
WBM-684 TV auxiliary
KB-97047 Remote Pickup
KSF-759 Remote Pickup
KKR-988 TV auxiliary
BLP-00445 TV auxiliary
BLO-790213MA TV auxiliary
BLQ-811015MG TV auxiliary
900902MF TV auxiliary
KC-3749 TV auxiliary
KX-7958 Remote Pickup
KC-5437 Remote Pickup
WNTL959 TV auxiliary
WNTL958 TV auxiliary
WNTL957 TV auxiliary
WLE-489 TV auxiliary
WLE-490 TV auxiliary
Schedule V to Credit Agreement
------------------------------
-5-
WLE-491 TV auxiliary
WLE-493 TV auxiliary
KA-88900 TV auxiliary
WNAC HEARST-ARGYLE TELEVISION, INC.
Call Sign Type
--------- ----
WDTN Main
WGZ-599 TV auxiliary
WLJ-325 TV auxiliary
WGZ-598 TV auxiliary
KUQ-43 TV auxiliary
BMPCT-7687 TV auxiliary
KK-2350 TV auxiliary
WZB-758 Remote Pickup
KVX-642 Remote Pickup
KQ-5598 TV auxiliary
KB-55261 TV auxiliary
KB-96270 TV auxiliary
KS-3413 Remote Pickup
BLP-00444 TV auxiliary
KA-2336 TV auxiliary
WMV-770 TV auxiliary
KC-26174 TV auxiliary
KR7807 TV auxiliary
KUQ43 TV auxiliary
KS2929 Remote Pickup
KITV ARGYLE TELEVISION, INC.
Parent Call Aux. Call Sign Expiration Date
----------- -------------- ---------------
HONOLULU, HI.
KITV(TV) KB-55352 0-0-00
XXX-000 0-0-00
XXX-000 2-1-99
KA-35132 0-0-00
XXX-000 0-0-00
Xxxxxxxx V to Credit Agreement
------------------------------
-6-
WAILUKU, HI.
KMUA(TV) WFW-614 2-1-99
WFW-615 2-1-99
WFW-616 0-0-00
XXX-000 0-0-00
XXXX, XX.
KHVO(TV) WCX-441 0-0-00
XXX-000 0-0-00
XXXXX, XX.
K51BB TV Translator 2-1-99
WNAC ARGYLE
TELEVISION, INC.
Parent Call Aux. Call Sign Expiration Date
----------- -------------- ----------------
WNAC(TV), Providence, RI 4-1-99
WAPT ARGYLE
TELEVISION, INC.
Parent Call Aux. Call Sign Expiration Date
-------------- ---------------
WAPT(TV), Jackson, MS KE-5839 6-1-2005
KSP-357 6-1-2005
KE-5843 6-1-2005
KP-2585 6-1-2005
KW-4092 6-1-2005
Schedule V to Credit Agreement
------------------------------
-7-
OHIO/OKLAHOMA
ARGYLE TELEVISION, INC.
Parent Call Aux. Call Sign Expiration Date
----------- ------------------ ---------------
WLWT(TV), Xxxxxxxxxx, XX XXX00000 00-0-00
XXX-000 00-0-00
XXX-000 00-0-00
XX-0000 10-1-97
KC-23102 10-1-97
KC-23103 00-0-00
XXX-000 00-0-00
XXX-000 00-0-00
XXX-000 10-1-97
KA088625 00-0-00
XXX-000 00-0-00
XXX-000 00-0-00
XXX-000 00-0-00
XXX-000 00-0-00
XX-00000 10-1-97
KE-5896 00-0-00
XXX-000 00-0-00
XXX-000 10-1-97
BLP-99816 10-1-97
BLP-00816 10-1-97
KA-99625 10-1-97
KY-5514 10-1-97
WCT-99625 10-1-97
Schedule V to Credit Agreement
------------------------------
-8-
OHIO/OKLAHOMA
TELEVISION, INC.
Parent Call Aux. Call Sign Expiration Date
----------- -------------- ---------------
XXXX(XX), Xxxxxxxx Xxxx, XXX-00000 6-1-98
OK KPH-911 0-0-00
XXX-000 0-0-00
XXX-000 0-0-00
XXX-000 0-0-00
XXX-000 0-0-00
XXX-00 0-0-00
XXX-000 6-1-98
KA-26191 6-1-98
KW-4040 6-1-98
KQ-5617 0-0-00
XXX-000 0-0-00
XXX-00000 6-1-98
KGJ-813 6-1-98
KW-4041 6-1-98
KHBS ARGYLE TELEVISION, INC.
Parent Call Aux. Call Sign Expiration Date
----------- -------------- ---------------
KHBS(TV), Fort Xxxxx, AR KC-27615 6-1-2005
KPM-413 6-1-2005
KPM-449 6-1-2005
KP3-985 6-1-2005
KPE-951 6-1-2005
KPM-450 6-1-2005
WHY-481 6-1-2005
WCQ-534 6-1-2005
WGM-90 6-1-2005
WMU-661 6-1-2005
KPM-451 6-1-2005
KPE-950 6-1-2005
WCQ-532 6-1-2005
KPM-445 6-1-2005
Schedule V to Credit Agreement
------------------------------
-9-
KHOG(TV), Fayetteville, AR KC-2616 6-1-2005
KPK-543 6-1-2005
WFD-538 6-1-2005
KPM-403 6-1-2005
KPM-404 6-1-2005
KPM-405 6-1-2005
KA-88647 6-1-2005
WCQ-536 6-1-2005
WFD-536 6-1-2005
WFD-537 6-1-2005
WFD-579 6-1-2005
WFD-580 6-1-2005
KC-26096 6-1-2005
WMU-414 6-1-2005
KHB-68 6-1-2005
WCT-536 6-1-2005
WCT-657 6-1-2005
Schedule V to Credit Agreement
------------------------------
SCHEDULE VI
Certain Equity Rights
---------------------
[See Section 4.14]
Neither the Borrower nor any of its subsidiaries shall repurchase any
outstanding shares of Series A Preferred Stock, $.01 par value per share, of the
Borrower (the "Series A Preferred Stock") unless the Borrower on the same terms
either (i) offers to purchase all of the then outstanding shares of Series A
Preferred Stock or (ii) offers to purchase shares of Series A Preferred Stock
from the holders in proportion to the respective number of shares of Series A
Preferred Stock held by each holder.
Neither the Borrower nor any of its subsidiaries shall repurchase any
outstanding shares of Series B Preferred Stock, $.01 par value per share, of the
Borrower (the "Series B Preferred Stock") unless the Borrower on the same terms
either (i) offers to purchase all of the then outstanding shares of Series B
Preferred Stock or (ii) offers to purchase shares of Series B Preferred Stock
from the holders in proportion to the respective number of shares of Series B
Preferred Stock held by each holder.
Schedule VI to Credit Agreement
-------------------------------
EXHIBIT A
[Form of Assignment and Acceptance]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of August 29, 1997
(as amended and in effect on the date hereof, the "Credit Agreement"), between
----------------
Argyle Television, Inc. (to be renamed Hearst-Argyle Television Inc. following
the Merger Transactions therein referred to), the Lenders named therein and The
Chase Manhattan Bank, as Administrative Agent for the Lenders. Terms defined in
the Credit Agreement are used herein with the same meanings.
The Assignor named on the reverse hereof hereby sells and assigns,
without recourse, to the Assignee named on the reverse hereof, and the Assignee
hereby purchases and assumes, without recourse, from the Assignor, effective as
of the Assignment Date set forth on the reverse hereof, the interests set forth
on the reverse hereof (the "Assigned Interest") in the Assignor's rights and
-----------------
obligations under the Credit Agreement, including the interests set forth on the
reverse hereof in the Commitment of the Assignor on the Assignment Date and
Loans owing to the Assignor which are outstanding on the Assignment Date,
together with unpaid interest accrued on the assigned Loans to the Assignment
Date, the participations in Letters of Credit, LC Disbursements and Swingline
Loans held by the Assignor on the Assignment Date, and the amount, if any, set
forth on the reverse hereof of the fees accrued to the Assignment Date for the
account of the Assignor. The Assignee hereby acknowledges receipt of a copy of
the Credit Agreement. From and after the Assignment Date (i) the Assignee shall
be a party to and be bound by the provisions of the Credit Agreement and, to the
extent of the interests assigned by this Assignment and Acceptance, have the
rights and obligations of a Lender thereunder and (ii) the Assignor shall, to
the extent of the interests assigned by this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Credit
Agreement.
This Assignment and Acceptance is being delivered to the
Administrative Agent together with (i) if the Assignee is a Foreign Lender, any
documentation required to be delivered by the Assignee pursuant to Section
2.16(e) of the Credit Agreement, duly completed and executed by the Assignee,
and (ii) if the Assignee is not already a Lender under the Credit Agreement, an
Administrative Questionnaire in the form supplied by the Administrative Agent,
duly completed by the Assignee. The [Assignee/Assignor] shall pay the fee
payable to the Administrative Agent pursuant to Section 10.04(b) of the Credit
Agreement.
This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.
Assignment and Acceptance
-------------------------
-2-
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment
("Assignment Date")/1/:
---------------
Percentage Assigned of
Facility/Commitment
(set forth, to at
least 8 decimals, as a
percentage of the
Facility and the
aggregate Commitments
Principal Amount of all Lenders
Facility Assigned thereunder
-------- -------- ----------------
Commitment Assigned: $ %
Loans:
Fees Assigned (if any):
The terms set forth above and on the reverse side hereof are hereby agreed to:
[Name of Assignor] , as Assignor
------------------------
By:
----------------------------------
Name:
Title:
[Name of Assignee] , as Assignee
------------------------
By:
----------------------------------
Name:
Title:
-----------------------
/1/ Must be at least five Business Days after execution hereof by all required
parties.
Assignment and Acceptance
-------------------------
-3-
The undersigned hereby consent to the within assignment:/2/
HEARST-ARGYLE TELEVISION, INC.
By:
--------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Administrative Agent and
Swingline Lender
By:
--------------------------
Name:
Title:
[NAME OF ISSUING LENDER]
By:
--------------------------
Name:
Title:
[NAME OF SWINGLINE LENDER]
By:
--------------------------
Name:
Title:
/2/ Consents to be included to the extent required by Section 10.04(b) of the
Credit Agreement.
Assignment and Acceptance
-------------------------
EXHIBIT B
[Form of Guarantee Assumption Agreement]
GUARANTEE ASSUMPTION AGREEMENT
GUARANTEE ASSUMPTION AGREEMENT dated as of ________ __, ____ by [NAME
OF ADDITIONAL SUBSIDIARY GUARANTOR], a ________ corporation (the "Additional
----------
Subsidiary Guarantor"), in favor of The Chase Manhattan Bank, as administrative
--------------------
agent for the lenders or other financial institutions or entities party as
"Lenders" to the Credit Agreement referred to below (in such capacity, together
with its successors in such capacity, the "Administrative Agent").
--------------------
Argyle Television, Inc. (to be renamed Hearst-Argyle Television Inc.
following the Merger Transactions therein referred to), a Delaware corporation,
the Subsidiary Guarantors referred to therein and the Administrative Agent are
parties to a Credit Agreement dated as of August 29, 1997 (as modified and
supplemented and in effect from time to time, the "Credit Agreement").
----------------
Pursuant to Section 6.09(c) of the Credit Agreement, the Additional
Subsidiary Guarantor hereby agrees to become a "Subsidiary Guarantor" for all
purposes of the Credit Agreement. Without limiting the foregoing, the
Additional Subsidiary Guarantor hereby, jointly and severally with the other
Subsidiary Guarantors, guarantees to each Lender and the Administrative Agent
and their respective successors and assigns the prompt payment in full when due
(whether at stated maturity, by acceleration or otherwise) of all Guaranteed
Obligations (as defined in Section 3.01 of the Credit Agreement) in the same
manner and to the same extent as is provided in Article III of the Credit
Agreement. In addition, the Additional Subsidiary Guarantor hereby makes the
representations and warranties set forth in Sections 4.01, 4.02 and 4.03 of the
Credit Agreement with respect to itself and its obligations under this
Agreement, as if each reference in such Sections to the Basic Documents included
reference to this Agreement.
Guarantee Assumption Agreement
------------------------------
-2-
IN WITNESS WHEREOF, the Additional Subsidiary Guarantor has caused
this Guarantee Assumption Agreement to be duly executed and delivered as of the
day and year first above written.
[NAME OF ADDITIONAL SUBSIDIARY
GUARANTOR]
By
-------------------------------
Title:
Accepted and agreed:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By
----------------------------
Title:
Guarantee Assumption Agreement
------------------------------
EXHIBIT C
[Form of Opinion of Counsel to the Obligors]
__________, 199__
To the Lenders party to the Credit Agreement referred to below and The Chase
Manhattan Bank, as Administrative Agent
Ladies and Gentlemen:
We have acted as counsel to Argyle Television (to be renamed Hearst-
Argyle Television Inc. following the Merger Transactions therein referred to),
Inc. (the "Borrower"), and its subsidiaries and affiliates, in connection with
--------
the Credit Agreement (the "Credit Agreement") dated as of August 29, 1997,
----------------
between the Borrower, the Subsidiary Guarantors party thereto, the lenders party
thereto and The Chase Manhattan Bank, as Administrative Agent, providing for
extensions of credit to be made by said lenders to the Borrower in an aggregate
principal or face amount not exceeding $***. Except as otherwise provided
herein, terms defined in the Credit Agreement are used herein as defined
therein. This opinion letter is being delivered pursuant to Section 5.01(b)(i)
of the Credit Agreement.
In rendering the opinions expressed below, we have examined the
following agreements, instruments and other documents:
(a) the Credit Agreement; and
(b) such records of the Obligors and such other documents as we have
deemed necessary as a basis for the opinions expressed below.
The Borrower and its Subsidiaries and affiliates party to the Credit Agreement
are herein collectively referred to as the "Obligors".
--------
In our examination, we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us as originals and the
conformity with authentic original documents of all documents submitted to us as
copies. When relevant facts were not independently established, we have relied
upon statements of governmental officials and upon representations made in or
pursuant to the Credit Agreement and certificates of appropriate representatives
of the Obligors.
In rendering the opinions expressed below, we have assumed, with
respect to all of the documents referred to in this opinion letter, that
(except, to the extent set forth in the opinions expressed below, as to the
Obligors):
Opinion of Counsel to the Obligors
----------------------------------
-2-
(i) such documents have been duly authorized by, have been duly
executed and delivered by, and constitute legal, valid, binding
and enforceable obligations of, all of the parties to such
documents;
(ii) all signatories to such documents have been duly authorized; and
(iii) all of the parties to such documents are duly organized and
validly existing and have the power and authority (corporate or
other) to execute, deliver and perform such documents.
Based upon and subject to the foregoing and subject also to the
comments and qualifications set forth below, and having considered such
questions of law as we have deemed necessary as a basis for the opinions
expressed below, we are of the opinion that:
1. The Borrower is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware. Each Subsidiary
of the Borrower is a corporation duly organized, validly existing and in
good standing under the laws of the respective state indicated opposite its
name in Schedule V to the Credit Agreement. Each of the Borrower and its
Subsidiaries has all requisite power and authority to carry on its business
as now conducted and, except where the failure to do so, individually or in
the aggregate, could not reasonably be expected to result in a Material
Adverse Effect, is qualified to do business in, and is in good standing in,
every jurisdiction where such qualification is required.
2. The Transactions are within the corporate powers of each Obligor.
3. The Transactions have been duly authorized by all necessary
corporate action on the part of each Obligor.
4. The Credit Agreement has been duly executed and delivered by each
Obligor party thereto.
5. Under conflict of law principles for the State of Texas, the
stated choice of New York law to govern the Credit Agreement will be
honored by the courts of the State of Texas and the Credit Agreement will
be construed in accordance with, and will be treated as being governed by,
the law of the State of New York. However, if the Credit Agreement were
stated to be governed by and construed in accordance with the law of the
State of Texas, or if a court of the State of Texas were to apply the law
of the State of Texas to the Credit Agreement, the Credit Agreement would
nevertheless constitute the legal, valid and binding obligation of each
Obligor party thereto, enforceable against such Obligor in accordance with
its terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws
Opinion of Counsel to the Obligors
----------------------------------
-3-
relating to or affecting the rights of creditors generally and except as
the enforceability of the Credit Agreement is subject to the application of
general principles of equity (regardless of whether considered in a
proceeding in equity or at law), including (a) the possible unavailability
of specific performance, injunctive relief or any other equitable remedy
and (b) concepts of materiality, reasonableness, good faith and fair
dealing.
6. The Transactions (a) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental
Authority, except such as have been obtained or made and are in full force
and effect, (b) will not violate any applicable law or regulation or the
charter, by-laws or other organizational documents of the Borrower or any
of its Subsidiaries or any order of any Governmental Authority, (c) will
not violate or result in a default under any indenture, agreement or other
instrument binding upon the Borrower or any of its Subsidiaries or assets,
or give rise to a right thereunder to require any payment to be made by any
such Person, and (d) will not result in the creation or imposition of any
Lien on any asset of the Borrower or any of its Subsidiaries.
7. [Except as set forth in Schedule IV to the Credit Agreement,] we
have no knowledge (after due inquiry) of any actions, suits or proceedings
by or before any arbitrator or Governmental Authority now pending against
or threatened against or affecting the Obligors or any of their respective
Subsidiaries (a) as to which there is a reasonable possibility of an
adverse determination and that, if adversely determined, could reasonably
be expected, individually or in the aggregate, to have a Material Adverse
Effect (other than the Disclosed Matters) or (b) that involve the Credit
Agreement or the Transactions.
8. Neither the Borrower nor any of its Subsidiaries is (a) an
"investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940 or (b) a "holding company" as defined in, or
subject to regulation under, the Public Utility Holding Company Act of
1935.
The foregoing opinions are subject to the following comments and
qualifications:
(A) The enforceability of Sections 3.03 and 10.03 of the Credit
Agreement may be limited by (i) laws rendering unenforceable
indemnification contrary to Federal or state securities laws and the public
policy underlying such laws and (ii) laws limiting the enforceability of
provisions exculpating or exempting a party, or requiring indemnification
of a party for, liability for its own action or inaction, to the extent the
action or inaction involves gross negligence, recklessness, willful
misconduct or unlawful conduct.
Opinion of Counsel to the Obligors
----------------------------------
-4-
(B) The enforceability of provisions in the Credit Agreement to the
effect that terms may not be waived or modified except in writing may be
limited under certain circumstances.
(C) We express no opinion as to (i) the effect of the laws of any
jurisdiction in which any Lender is located (other than the State of Texas)
that limit the interest, fees or other charges such Lender may impose, (ii)
the last sentence of Section 2.17(d) or Section 3.06 of the Credit
Agreement and (iii) the first sentence of Section 10.09(b) of the Credit
Agreement, insofar as such sentence relates to the subject matter
jurisdiction of the United States District Court for the Southern District
of New York to adjudicate any controversy related to the Credit Agreement.
(D) We express no opinion as to the applicability to the obligations
of any Subsidiary Guarantor of Section 548 of the Bankruptcy Code, Article
10 of the New York Debtor Creditor Law or any other provision of law
relating to fraudulent conveyances, transfers or obligations, nor do we
express any opinion as to the enforceability of such obligations.
The foregoing opinions are limited to matters involving the Federal
laws of the United States[, the Delaware General Corporation Law] and the law of
the State of Texas, and we do not express any opinion as to the laws of any
other jurisdiction (nor do we express any opinion as to the applicability to, or
the effect upon, the transactions contemplated by the Credit Agreement of the
Federal Communications Act of 1934, as amended, the rules and regulations
promulgated thereunder or the policies of the FCC).
At the request of our clients, this opinion letter is, pursuant to
Section 5.01(b)(i) of the Credit Agreement, provided to you by us in our
capacity as counsel to the Obligors and may not be relied upon by any Person for
any purpose other than in connection with the transactions contemplated by the
Credit Agreement without, in each instance, our prior written consent.
Very truly yours,
Opinion of Counsel to the Obligors
----------------------------------
EXHIBIT D
[Form of Opinion of Special Communications Counsel to the Borrower]
, 199
---------- --
To the Lenders party to the Credit Agreement
referred to below and The Chase
Manhattan Bank, as Administrative Agent
Ladies and Gentlemen:
We have acted as special communications counsel to Argyle Television,
Inc. (to be renamed Hearst-Argyle Television Inc. following the Merger
Transactions therein referred to), a Delaware corporation (the "Borrower"), and
--------
its Subsidiaries in connection with the Credit Agreement (the "Credit
------
Agreement") dated as of August 29, 1997, between the Borrower, the Subsidiary
Guarantors party thereto, the lenders party thereto and The Chase Manhattan
Bank, as Administrative Agent, providing for extensions of credit to be made by
said lenders to the Borrower in an aggregate principal or face amount not
exceeding $***. Terms defined in the Credit Agreement are used herein as
defined therein. This opinion letter is being delivered pursuant to Section
5.01(b)(ii) of the Credit Agreement.
We have examined originals or copies authenticated to our satisfaction
of all such agreements, instruments and other documents, and such other
documents and public files of the Federal Communications Commission ("FCC") as
---
we have deemed necessary in connection with the opinions hereinafter expressed.
In such examination we have assumed the genuineness of all signatures, the
authenticity of documents submitted to us as originals, the conformity with the
originals of all documents submitted to us as certified or photostatic copies,
and the authenticity of the originals of such latter documents. As to questions
of fact material to such opinions, we have, when relevant facts were not
independently established, relied upon representations and certificates of the
Borrower and its Subsidiaries and their respective officers.
Our opinions set forth below are limited to matters governed by the
Federal Communications Act of 1934, as amended (the "Communications Act"), and
------------------
the rules and regulations promulgated thereunder or the policies of the FCC.
Based upon the foregoing, we are of the opinion that:
1. On ________________, the FCC granted the application for consent
to assignment (File No.__________________) of the main station license and
associated broadcast auxiliary licenses for the operation of television
broadcast station ____-TV, Channel ___, [City, State --Complete as
appropriate]. Such grant by the FCC is valid
Opinion of Special Communications Counsel to the Borrower
---------------------------------------------------------
-2-
and subsisting and final (i.e. no longer subject to further judicial or
administrative review) and no further approval or action of the FCC is
required to permit the assignments of such licenses to ________________.
All such licenses are in full force and effect. To our knowledge, no
authorizations, approvals or consents of, and no filings or registrations
with the FCC are required for the existing operation of said Station.
2. To our knowledge, there is no action, suit, or proceeding before
the FCC pending or threatened against or affecting the Borrower or any of
its Subsidiaries. To our knowledge, each of the Stations is operating in
compliance in all material respects with its FCC licenses, the Act and the
current rules, regulations and policies of the FCC.
3. No authorizations, consents, approvals, licenses, filings or
registrations with the FCC are required in connection with the execution,
delivery or performance by the Borrower of the Credit Agreement and the
other Basic Documents.
The foregoing opinions are limited to matters involving the Federal
Communications Act of 1934, as amended, the rules and regulations promulgated
thereunder or the policies of the FCC.
At the request of our clients, this opinion letter is, pursuant to
Section 5.01(b)(ii) of the Credit Agreement, provided to you by us in our
capacity as special communications counsel to the Obligors and may not be relied
upon by any Person for any purpose other than in connection with the
transactions contemplated by the Credit Agreement without, in each instance, our
prior written consent.
Very truly yours,
Opinion of Special Communications Counsel to the Borrower
---------------------------------------------------------
EXHIBIT E
[Form of Opinion of Special New York Counsel to The Chase Manhattan Bank]
, 199
---------- --
To the Lenders party to the Credit Agreement
referred to below and The Chase
Manhattan Bank, as Administrative Agent
Ladies and Gentlemen:
We have acted as special New York counsel to The Chase Manhattan Bank
in connection with the Credit Agreement (the "Credit Agreement") dated as of
----------------
August 29, 1997, between Argyle Television, Inc. (to be renamed Hearst-Argyle
Television Inc. following the Merger Transactions therein referred to, and
herein referred to as the "Borrower"), the Subsidiary Guarantors party thereto,
--------
the lenders party thereto and The Chase Manhattan Bank, as Administrative Agent,
providing for extensions of credit to be made by said lenders to the Borrower in
an aggregate principal or face amount not exceeding $1,000,000,000. Except as
otherwise provided herein, terms defined in the Credit Agreement are used herein
as defined therein. This opinion letter is being delivered pursuant to Section
5.01(c) of the Credit Agreement.
In rendering the opinions expressed below, we have examined the
following agreements, instruments and other documents:
(a) the Credit Agreement; and
(b) such records of the Obligors and such other documents as we have
deemed necessary as a basis for the opinions expressed below.
The Borrower and its Subsidiaries and affiliates party to the Credit Agreement
are herein collectively referred to as the "Obligors".
--------
In our examination, we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us as originals and the
conformity with authentic original documents of all documents submitted to us as
copies. When relevant facts were not independently established, we have relied
upon representations made in or pursuant to the Credit Agreement.
In rendering the opinions expressed below, we have assumed, with
respect to all of the documents referred to in this opinion letter, that:
(i) such documents have been duly authorized by, have been duly
executed and delivered by, and (except to the extent set forth in
the opinions
Opinion of Special New York Counsel to The Chase Manhattan Bank
---------------------------------------------------------------
-2-
expressed below as to the Obligors) constitute legal, valid,
binding and enforceable obligations of, all of the parties to
such documents;
(ii) all signatories to such documents have been duly authorized;
and
(iii) all of the parties to such documents are duly organized and
validly existing and have the power and authority (corporate or
other) to execute, deliver and perform such documents.
Based upon and subject to the foregoing and subject also to the
comments and qualifications set forth below, and having considered such
questions of law as we have deemed necessary as a basis for the opinions
expressed below, we are of the opinion that the Credit Agreement constitutes the
legal, valid and binding obligation of each Obligor party thereto, enforceable
against such Obligor in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights of creditors generally and except as the
enforceability of the Credit Agreement is subject to the application of general
principles of equity (regardless of whether considered in a proceeding in equity
or at law), including (a) the possible unavailability of specific performance,
injunctive relief or any other equitable remedy and (b) concepts of materiality,
reasonableness, good faith and fair dealing.
The foregoing opinions are subject to the following comments and
qualifications:
(A) The enforceability of Sections 3.03 and 10.03 of the Credit
Agreement may be limited by (i) laws rendering unenforceable
indemnification contrary to Federal or state securities laws and the public
policy underlying such laws and (ii) laws limiting the enforceability of
provisions exculpating or exempting a party, or requiring indemnification
of a party for, liability for its own action or inaction, to the extent the
action or inaction involves gross negligence, recklessness, willful
misconduct or unlawful conduct.
(B) The enforceability of provisions in the Credit Agreement to the
effect that terms may not be waived or modified except in writing may be
limited under certain circumstances.
(C) We express no opinion as to (i) the effect of the laws of any
jurisdiction in which any Lender is located (other than the State of New
York) that limit the interest, fees or other charges such Lender may
impose, (ii) the last sentence of Section 2.17(d) or Section 3.06 of the
Credit Agreement and (iii) the first sentence of Section 10.09(b) of the
Credit Agreement, insofar as such sentence relates to the
Opinion of Special New York Counsel to The Chase Manhattan Bank
---------------------------------------------------------------
-3-
subject matter jurisdiction of the United States District Court for the
Southern District of New York to adjudicate any controversy related to the
Credit Agreement.
(D) We express no opinion as to the applicability to the obligations
of any Subsidiary Guarantor of Section 548 of the Bankruptcy Code, Article
10 of the New York Debtor Creditor Law or any other provision of law
relating to fraudulent conveyances, transfers or obligations, nor do we
express any opinion as to the enforceability of such obligations.
The foregoing opinions are limited to matters involving the Federal
laws of the United States and the law of the State of New York, and we do not
express any opinion as to the laws of any other jurisdiction (nor do we express
any opinion as to the applicability to, or the effect upon, the transactions
contemplated by the Credit Agreement of the Federal Communications Act of 1934,
as amended, the rules and regulations promulgated thereunder or the policies of
the FCC).
At the request of our client, this opinion letter is, pursuant to
Section 5.01(c) of the Credit Agreement, provided to you by us in our capacity
as special New York counsel to The Chase Manhattan Bank and may not be relied
upon by any Person for any purpose other than in connection with the
transactions contemplated by the Credit Agreement without, in each instance, our
prior written consent.
Very truly yours,
[Opining and Consultant
Partner's initials]
Opinion of Special New York Counsel to The Chase Manhattan Bank
---------------------------------------------------------------
EXHIBIT A TO
CREDIT AGREEMENT
TERM NOTE
$72,000,000 New York, New York
____________, 1998
FOR VALUE RECEIVED, STC BROADCASTING OF VERMONT SUBSIDIARY, INC.
("Borrower") promises to pay to the order of HEARST-ARGYLE STATIONS, INC. (the
"Lender") at its office, located at __________________________________, in
lawful money of the United States of America and in immediately available funds,
the principal amount of SEVENTY-TWO MILLION DOLLARS ($72,000,000), or, if less,
the principal amount of the Loans made by the Lender pursuant to subsection 2.1
of the Credit Agreement referred to below. The principal amount of this Note
shall be paid in the amounts and on the dates specified in subsection 2.3 of the
Credit Agreement.
Borrower further agrees to pay interest in like money at the office of the
Lender specified above on the unpaid principal amount hereof from time to time
outstanding at the rates and on the dates specified in subsection 2.4 of the
Credit Agreement.
The holder of this Note is authorized to endorse on the schedule annexed
hereto and made a part hereof or on a continuation thereof which shall be
attached hereto and made a part hereof the date and amount of each Loan and the
date and amount of each payment or prepayment of principal thereof. Each such
endorsement shall constitute prima facie evidence of the accuracy of the
----- -----
information endorsed. The failure to make any such endorsement shall not affect
the obligations of Borrower in respect of the Loans.
This Note (i) is the Note referred to in the Credit Agreement dated as of
______________, 1998 (as amended, supplemented or otherwise modified from time
to time, the "Credit Agreement"), between Borrower and the Lender, (ii) is
subject to the provisions of the Credit Agreement (including the limitations on
transfers and assignments set forth in Section 9.6 thereof) and (iii) is subject
to prepayment as provided in the Credit Agreement. This Note is secured as
provided in the Credit Agreement and the Related Documents.
Upon the occurrence of any one or more Events of Default, all amounts then
remaining unpaid on this Note shall become, or may be declared to be,
immediately due and payable, all as provided in the Credit Agreement.
All parties now and hereafter liable with respect to this Note, whether as
maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.
SCHEDULE TO TERM NOTE
---------------------
Amount of Amount of Notation Made
Date Loan Principal Repaid Unpaid Balance By
---- --------- ---------------- -------------- -------------
Unless otherwise defined herein, terms defined in the Credit Agreement and
used herein shall have the meanings given to them in the Credit Agreement.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.
STC BROADCASTING OF VERMONT
SUBSIDIARY, INC.
By:
---------------------------------------
Name:
Title:
2
SCHEDULE TO TERM NOTE
---------------------
Amount of Amount of Notation Made
Date Loan Principal Repaid Unpaid Balance By
---- --------- ---------------- -------------- -------------
3
EXHIBIT B TO
CREDIT AGREEMENT
PLEDGE AGREEMENT
This Pledge Agreement (the "Pledge Agreement") is made and
entered into as of ___________, 1998 by and between STC Broadcasting of Vermont,
Inc., a Delaware corporation (the "Pledgor") and HEARST-ARGYLE STATIONS, INC.
-------
(the "Lender").
------
RECITALS
WHEREAS, the Pledgor is the owner of [____________] shares of
common stock (the "Shares") of STC BROADCASTING OF VERMONT SUBSIDIARY, INC. (the
------
"Borrower"), constituting 100% of the issued and outstanding shares of common
stock of the Borrower; and
WHEREAS, the Borrower and the Lender have entered into a
Credit Agreement dated as of the date hereof (as amended, modified and
supplemented from time to time, the "Credit Agreement") pursuant to which the
----------------
Lender has agreed to make Loans to the Borrower; and
WHEREAS, in order to secure the Obligations of the Borrower
under the Credit Agreement and the Note and the obligations of the Pledgor under
the Guaranty and this Pledge Agreement, the Lender has required the Pledgor to
pledge, and the Pledgor has agreed to pledge to the Lender, the Shares together
with the other items of Collateral set forth herein;
NOW, THEREFORE, in consideration of the premises and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions. Except as otherwise defined herein,
-----------
all capitalized terms used but not defined herein shall have the respective
meanings given to such terms in the Credit Agreement.
SECTION 2. Creation of Security Interest. The Pledgor hereby
-----------------------------
pledges, grants and assigns to the Lender an exclusive and continuing security
interest in and lien on all of its right, title and interest in, to and under
the following (hereinafter, the "Collateral") as security for the payment and
----------
performance in full of the Obligations of the Borrower under the Credit
Agreement and the Note and the obligations of the Pledgor hereunder and under
the Guaranty;
(a) The Shares, together with the certificates representing
such Shares and all rights and privileges of the Pledgor with respect
to the Shares, all income and profits thereof and all property received
in addition thereto, in respect thereof or in exchange or in
substitution therefor;
(b) Any and all proceeds of any of the foregoing.
The Shares and all other shares or other ownership interests constituting a part
of the "Collateral" described in clauses (a) and (b) above are hereinafter
collectively referred to as the "Pledged Securities".
------------------
SECTION 3. Delivery of Certificates. Simultaneously with the
------------------------
execution and delivery hereof, the Pledgor is delivering to the Lender all
instruments and certificates representing the Pledged Securities, together with
appropriate undated instruments of transfer or assignment duly executed in
blank. In addition, the Pledgor shall promptly deliver to the Lender, or cause
the issuer of the Pledged Securities to deliver directly to the Lender, all
certificates, instruments or other property, including any cash dividends or
distributions representing or constituting any Collateral received or receivable
by the Pledgor after the date of this Pledge Agreement, other than distributions
permitted by Section 7.6 of the Credit Agreement. Any certificates or other
instruments so delivered shall be duly endorsed and subscribed by the Pledgor or
accompanied by appropriate instruments of transfer or assignment duly executed
in blank by the Pledgor. Any such certificates, instruments or other property
representing or constituting any Collateral received by the Pledgor after the
date of this Pledge Agreement shall be held by the Pledgor in trust for the
Lender and shall forthwith be delivered by the Pledgor to the Lender as
aforesaid. If at any time the Lender notifies the Pledgor that additional
endorsements or other instruments of transfer or assignment with respect to any
of the Collateral held by the Lender are required, the Pledgor shall promptly
execute the same in blank and deliver such endorsements or other instruments of
transfer or assignment as the Lender may request.
SECTION 4. Dividends and Distributions. The Pledgor shall
---------------------------
deliver to the Lender, as Collateral, any and all additional shares of stock or
any other property of any kind received, receivable, distributed or
distributable on or by reason of the Collateral pledged hereunder, whether in
the form of or by way of cash, stock dividends or distributions, warrants,
subscription rights, liquidation (in whole or in part), conversion, prepayment
or redemption (in whole or in part) or otherwise.
SECTION 5. Power of Attorney. The Pledgor hereby constitutes
-----------------
and irrevocably appoints the Lender, with full power of substitution and
revocation by the Lender, as the Pledgor's true and lawful attorney-in-fact, for
the purpose from time to time upon the occurrence and during the continuance of
an Event of Default of carrying out the provisions of this Pledge Agreement and
taking any action and executing any instrument that the Lender deems necessary
or advisable to accomplish the purposes of this Pledge Agreement, including,
without limitation, to affix to certificates and documents representing any
Collateral the endorsements or other instruments of transfer or assignment
delivered with respect thereto and to transfer or cause the transfer of the
Collateral, or any part thereof, on the books of the Borrower. The power of
attorney granted pursuant to this Pledge Agreement and all authority hereby
conferred are granted and conferred solely to protect the Lender's interest in
the Collateral and shall not impose any duty upon the Lender to exercise any
power. This power of attorney shall be irrevocable as one coupled with an
interest.
SECTION 6. Representations of Pledgor. The Pledgor represents
--------------------------
and warrants to the Lender that:
(a) No consent or authorization of, filing with, or other act
by or in respect of, any arbitrator or Governmental Authority and no
consent of any other Person is required (i) for the execution, delivery
and performance of this Pledge Agreement by the Pledgor,
2
(ii) for the Pledge by the Pledgor of the Collateral to the Lender
pursuant to this Pledge Agreement, or (iii) subject to Section 17
hereof, for the exercise by the Lender of the rights provided for in
this Pledge Agreement or the remedies in respect of the Collateral
pursuant to this Pledge Agreement, except as may be required under
federal or state securities laws in connection with any sale of the
Collateral;
(b) The Pledgor is the sole legal and beneficial owner of, and
has valid and transferrable title to, the Collateral, free and clear of
all Liens, other than the Lien in favor of the Lender created by this
Pledge Agreement;
(c) There are no outstanding options, warrants or other
agreements with respect to the Collateral;
(d) The Shares represent 100% of the issued and outstanding
capital stock of the Borrower.
(e) The Pledged Securities have been duly authorized and
validly issued, are fully paid and non-assessable, and, subject to
Section 17 hereof, are not subject to any charter, bylaw, statutory,
contractual or other restrictions governing their issuance, transfer,
ownership or control; and
(f) All actions (including, without limitation, delivery to
the Lender of all certificates representing the Pledged Securities
together with undated stock powers or other instruments of assignment
duly executed in blank, registration of the Lien created hereby on the
Collateral on the books and records of the issuer of any Pledged
Securities and, if required, the filing of UCC-1 financing statements
in all appropriate jurisdictions) required to create and perfect the
Lien of the Lender in the Collateral have been taken and the Lien on
the Collateral in favor of the Lender is superior in right to any
rights or claims of any other Person.
SECTION 7. Obligations of Pledgor. The Pledgor further
----------------------
covenants to the Lender that:
(a) The Pledgor will not sell, transfer or convey any interest
in, or suffer or permit any Lien to exist on or with respect to, any of
the Collateral except the Lien created under this Pledge Agreement;
(b) The Pledgor will, at its own expense, at any time and from
time to time at the request of the Lender, do, make, procure, execute
and deliver all acts, things, writings, assurances and other documents
as may be reasonably requested by the Lender to further preserve,
establish, perfect or enforce the Lender's rights, interests and
remedies created by, provided in or emanating from this Pledge
Agreement;
(c) The Pledgor will defend the Lender's right, title and
interest in, to and under the Collateral against the claims and demands
of all Persons whomsoever (other than Persons claiming by or through
the Lender);
(d) The Pledgor hereby authorizes the Lender to file one or
more financing or continuation statements and amendments thereto
relating to all or any part of the
3
Collateral without the Pledgor's signature. A photocopy or other
reproduction of this Pledge Agreement shall be sufficient as a
financing statement;
(e) The Pledgor will not permit the Borrower to issue any
additional securities or capital stock; and
(f) The Pledgor will cause the Borrower to execute and deliver
to the Lender on the date hereof a letter substantially in the form of
Exhibit A hereto.
SECTION 8. Rights of Pledgor. So long as no Event of Default
-----------------
has occurred and is continuing, the Pledgor shall be entitled to vote or consent
with respect to the Collateral in any manner not inconsistent with this Pledge
Agreement, the Credit Agreement or any other Related Document. Upon the
occurrence and during the continuance of an Event of Default, the Lender shall
have the exclusive right to vote the Pledged Securities. The Pledgor hereby
grants to the Lender an irrevocable proxy to vote the Collateral, which proxy
shall be effective immediately upon the occurrence of and during the continuance
of an Event of Default, and upon the request of the Lender, the Pledgor agrees
to deliver to the Lender such further evidence of such irrevocable proxy or such
further irrevocable proxy to vote the Collateral as the Lender may request.
SECTION 9. Rights of the Lender.
--------------------
(a) If the Pledgor fails to perform any agreement contained
herein, the Lender may (but shall not be obligated or required to) perform, or
cause the performance, of such agreement
(b) At any time upon and during the continuance of an Event of
Default, the Lender may (but shall not be obligated or required to):
(i) Subject to Section 17 hereof, cause the
Collateral to be transferred to its name or to the name of its nominee
or nominees and thereafter exercise as to such Collateral all of the
rights, powers and remedies of an owner,
(ii) Ask for, demand, collect, xxx for, recover,
compromise, receive and give acquittances and receipts for monies due
or to become due under or in respect of any of the Collateral and hold
the same as part of the Collateral, or apply the same to any of the
Obligations in such manner as the Lender may direct in its sole
discretion;
(iii) Receive, endorse and collect any drafts or
other instruments, documents and chattel paper, in connection with
clause (ii) above (including, without limitation, all instruments
representing dividends, interest payments or other distributions in
respect of the Collateral or any part thereof and give full discharge
for the same);
(iv) Subject to Section 17 hereof, file any claims or
take any actions or institute any proceedings that the Lender may deem
necessary or desirable for the collection of any of the Collateral or
otherwise to enforce compliance with the rights of the Lender with
respect to any of the Collateral;
(v) Enter into any extension, subordination,
reorganization, deposit, merger, or consolidation agreement, or any
other agreement relating to or affecting the Collateral, and in
connection therewith deposit or surrender control of such Collateral
4
thereunder, and accept other property in exchange therefor and hold and
apply such property or money so received in accordance with the
provisions hereof; and
(vi) Discharge any taxes levied on the Collateral or
pay for the maintenance and preservation of the Collateral; the amount
of such payments, plus any and all fees, costs and expenses of the
Lender (including reasonable attorneys' fees and disbursements)
actually in connection therewith, shall, at the Lender's option, be
reimbursed by the Pledgor on demand.
SECTION 10. Release of Collateral. In the event that the
---------------------
entire outstanding principal sum of and accrued interest on the Loans is paid in
full and all other non-contingent Obligations are pain and performed in full,
the Lender shall deliver the Collateral to the Pledgor, thereby releasing the
security interest granted hereunder and this Pledge Agreement shall terminate.
SECTION 11. Event of Default Remedies. Upon and during the
-------------------------
continuance of an Event of Default:
(a) The Lender shall have all the rights and remedies of a
secured party under the Uniform Commercial Code as in effect in any
applicable jurisdiction. In addition, the Lender shall have the right,
without demand of performance or other demand, advertisement or notice
of any kind, except as specified below, to or upon the Pledgor or any
other Person (all and each of which demands, advertisements and/or
notices are hereby expressly waived), to proceed forthwith to collect,
receive, appropriate and realize upon the Collateral, or any part
thereof and to proceed forthwith to sell, assign, give an option or
options to purchase, contract to sell, or otherwise dispose of and
deliver the Collateral or any part thereof in one or more parcels at
public or private sale or sales at such prices and on such terms and
restrictions (including, without limitation, a requirement that any
purchaser of all or any part of the Collateral shall be required to
purchase any securities constituting the Collateral solely for
investment and without any intention to make a distribution thereof) as
the Lender may deem appropriate without any liability for any loss due
to decrease in the market value of the Collateral during the period
held. If any notification to the Pledgor of the intended disposition of
the Collateral is required by law, such notification shall be deemed
reasonable and properly given if hand delivered or made by telecopy at
least ten Business Days' prior to such disposition to the address of
the Pledgor indicated below.
(b) All of the Lender's rights and remedies under this Pledge
Agreement and under applicable law, including but not limited to the
foregoing, shall be cumulative and not exclusive and shall be
enforceable alternatively, successively or concurrently as the Lender
may deem expedient
(c) Upon any sale or other disposition. the Lender shall have
the right to deliver, endorse, assign and transfer to the purchaser
thereof the Collateral so sold or disposed of. Each purchaser at any
such sale or other disposition, including the Lender, shall hold the
Collateral free from any claim or right of whatever kind, including any
equity or right of redemption. The Pledgor specifically waives all
rights of stay or appraisal which the Pledgor had or may have under any
rule of law or statute now existing or hereafter adopted.
5
(d) The Lender undertakes to use commercially reasonable
efforts to cause a sale of the Collateral: provided, that the Lender
--------
shall not be obligated to make any sale or other disposition unless the
terms thereof shall be satisfactory to it. The Pledgor acknowledges and
agrees that the Lender shall have no liabilities for any delay
experienced in its efforts to effect such a sale or the ultimate terms
of any such sale. The Lender may, without notice or publication,
adjourn any private or public sale, and, upon ten Business Days' prior
notice to the Pledgor, hold such sale at any time or place to which the
same may be so adjourned. In case of any sale of all or any part of the
Collateral, on credit or future delivery, the Collateral so sold may be
retained by the Lender until the selling price is paid by the purchaser
thereof, but the Lender shall incur no liability in case of the failure
of such purchaser to take up and pay for the property so sold and, in
case of any such failure, such property may again be sold as herein
provided.
SECTION 12. Disposition of Proceeds. The proceeds of any sale
-----------------------
or disposition of all or any part of the Collateral shall be applied (after
payment of any amounts payable to the Lender pursuant to Section 14 hereof) by
the Lender to the payment of the Obligations in such order as the Lender may
elect. Any surplus thereafter remaining shall be paid to the Pledgor, subject to
the rights of any holder of a Lien on the Collateral of which the Lender has
actual notice. If the proceeds from the sale of the Collateral are insufficient
to satisfy the Obligations. the Pledgor shall remain liable for any deficiency.
SECTION 13. Termination. This Pledge Agreement shall: (a)
-----------
create a continuing security interest in the Collateral; (b) remain in full
force and effect for so long as any Obligations under any of the Related
Documents are outstanding; (c) be binding upon the Pledgor and its permitted
successors and assigns; and (d) inure to the benefit of the Lender and its
successors, transferees and assigns. Without limiting the foregoing, the Lender
may assign or otherwise transfer the Loan, or any portion thereof, held by it to
any other Person in accordance with the terms of the Credit Agreement, and such
other Person shall thereupon become vested with all the benefits in respect
thereof granted herein or otherwise. The Pledgor may not assign its rights or
obligations under this Pledge Agreement without the prior written consent of the
Lender.
SECTION 14. Expenses of the Lender. All expenses (including,
----------------------
without limitation, reasonable attorneys' fees and disbursements) actually
incurred by the Lender in connection with the failure by the' Pledgor to perform
or observe any provision of this Pledge Agreement, the exercise or enforcement
of any rights of the Lender under this Pledge Agreement and the custody or
preservation of any of the Collateral and any actual or attempted sale or
exchange of, or any enforcement, collection, compromise or settlement
respecting, the Collateral, or any other action taken by the Lender hereunder
whether directly or as attorney-in-fact pursuant to a power of attorney or other
authorization herein conferred, shall be deemed an Obligation secured by the
Collateral and the Lender may apply the Collateral to payment of or
reimbursement of itself for such liability.
SECTION 15. Lender's Duty. Except as otherwise expressly set
-------------
forth in Section 11(d) hereof, the Lender shall not be required to take any
action hereunder in respect of an Event of Default. The Lender shall not be
liable for any acts, omissions, errors of judgment or mistakes of fact or law
including, without limitation, acts, omissions, errors or mistakes with respect
to the Collateral, except for those arising out of or in connection with the
Lender's (i) gross negligence' or willful misconduct, or (ii) failure to use
reasonable care with respect to the safe custody of any certificate or
instrument evidencing any part of the Collateral which is in the
6
physical possession of the Lender. The Lender shall be under no obligation to
take any steps necessary to preserve rights in the Collateral against any prior
parties but may do so at its option, and all expenses incurred in connection
therewith shall be for the account of the Pledgor, and shall be added to the
Obligations secured hereby.
SECTION 16. General Provisions.
------------------
(a) No failure on the part of the Lender to exercise, and no
delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise by the Lender of any
right, power or remedy hereunder preclude any other or future exercise thereof,
or the exercise of any other right, power or remedy. The representations,
covenants and agreements of the Pledgor herein contained shall survive the date
hereof.
(b) This Pledge Agreement is a Related Document to which
reference is made in, and which is executed pursuant to, the Credit Agreement
and shall (unless otherwise expressly indicated herein) be construed,
administered and applied in accordance with the terms and provisions thereof.
(c) No amendment or waiver of any provision of this Pledge
Agreement nor consent to any departure by the Pledgor herefrom nor release of
all or any part of the Collateral shall in any event be effective unless the
same shall be in writing, signed by the Lender. Any such waiver or consent or
release shall be effective only in the specific instance and for the specific
purpose for which it is given.
(d) Except as expressly otherwise provided herein, all
notices, requests and demands to or upon the respective parties hereto to be
effective shall be in writing (including by telecopy or telex), and shall be
delivered and deemed effective in the manner set forth in the Credit Agreement,
except that the address for all notices to Pledgor shall be the address set
forth below the signature of the Pledgor.
(e) THIS PLEDGE AGREEMENT SHALL BE GOVERNED BY, AND
INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
EACH OF THE LENDER AND THE PLEDGOR HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS PLEDGE AGREEMENT.
(f) The Pledgor hereby consents to the non-exclusive
jurisdiction of the Supreme Court of the State of New York for New York County
and the United States District Court for the Southern District of New York with
respect to any suit, claim, action or proceeding arising out of or related to
this Pledge Agreement or the transactions contemplated hereby and hereby waives
any objection which it may have now or hereafter to the venue of any suit,
claim, action or proceeding arising out of or related to this Pledge Agreement
or the transactions contemplated hereby and brought in the courts specified
above and also hereby waives any claim that any such suit, claim, action or
proceeding has been brought in an inconvenient forum. The Pledgor agrees that
service of process or other legal summons for purposes of any action or
proceeding under this Pledge Agreement or the other Related Documents may be
served on Pledgor by mailing a copy thereof by registered mail, or a form of
mail substantially equivalent thereto, addressed to it at its address set forth
in or designated pursuant to Section 16(d), such
7
service to become effective 10 days after such mailing and agrees that nothing
herein shall affect the right to effect service of process in any other manner
permitted by law or shall limit the right to xxx in any other jurisdiction.
(g) If any provision of this Pledge Agreement is determined by
a court of competent jurisdiction to be unenforceable, such provision shall be
automatically reformed and construed so as to be valid, operative and
enforceable to the maximum extent permitted by the law while most nearly
preserving its original intent. The invalidity of any part of this Pledge
Agreement shall not render invalid the remainder of the Pledge Agreement.
(h) This Pledge Agreement may be executed in counterparts,
each of which when so executed and delivered shall be deemed an original, but
all such counterparts taken together shall constitute but one and the same
instrument.
(i) The section headings in this Pledge Agreement are for
convenience of reference only and shall not affect the interpretation hereof.
SECTION 17. FCC Compliance.
--------------
(a) Notwithstanding anything to the contrary contained herein
or in any other agreement, instrument, or document executed in connection
herewith, no party hereto shall take any actions hereunder that would constitute
or result in a transfer or assignment of any Station License (as defined in the
HAT Exchange Agreement), permit or authorization, or a change of control over
such Station License, permit or authorization requiring the prior approval of
the FCC without first obtaining such prior approval of the FCC. In addition, the
parties acknowledge that the voting rights of the Pledged Securities shall
remain with the Pledgor even upon the occurrence and during the continuance of
an Event of Default until the FCC shall have given its prior consent to the
exercise of stockholder rights by a purchaser at a public or private sale of
such Pledged Securities or the exercise of such rights by the Lender or by a
receiver, trustee, conservator or other agent duly appointed pursuant to
applicable law.
(b) If an Event of Default shall have occurred, Pledgor shall
take any action which the Lender may request in the exercise of its rights and
remedies under this Pledge Agreement in order to transfer or assign the
Collateral to the Lender or to such one or more third parties as the Lender may
designate, or to a combination of the foregoing. To enforce the provisions of
this Section 17, the Lender is empowered to seek from the FCC and any other
----------
Governmental Authority, to the extent required, consent to or approval of any
involuntary transfer of control of any entity whose Collateral is subject to
this Pledge Agreement for the purpose of seeking a bona fide purchaser to whom
control ultimately will be transferred. Pledgor agrees to cooperate with any
such purchaser and with the Lender in the preparation, execution and filing of
any forms and providing any information that may be necessary or helpful in
obtaining the FCC's consent to the assignment to such purchase of the
Collateral. Pledgor hereby agrees to consent to any such voluntary or
involuntary transfer after and during the continuation of an Event of Default
and, without limiting any rights of the Lender under this Pledge Agreement, to
authorize the Lender to nominate a trustee or receiver to assume control of the
Collateral, subject only to required judicial, FCC or other consents required by
Governmental Authorities, in order to effectuate the transactions contemplated
by this Section 17. Such trustee or receiver shall have all the rights and
----------
powers as provided to it by law or court order, or to the Lender under this
Pledge Agreement. Pledgor shall cooperate fully in obtaining the consent of the
FCC
8
and the approval or consent of each other Governmental Authority required to
effectuate the foregoing.
(c) In connection with this Section 17, the Lender shall be
----------
entitled to rely in good faith upon an opinion of outside FCC counsel of the
Lender's choice with respect to any such assignment or transfer, whether or not
the advice rendered is ultimately determined to have been accurate.
[signatures begin on next page]
9
IN WITNESS WHEREOF, the parties hereto have caused this Pledge
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.
STC BROADCASTING OF VERMONT, INC.
By:
--------------------------------------
Name:
Title:
Address: c/o STC Broadcasting, Inc.
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xx. Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxx Xxxx
Tel.: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Xxxxx & Xxxxxxx LLP
000 Xxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attn: Xxxxxxx X. Xxxxxx, Xx.
Tel.: (000) 000-0000
Fax: (000) 000-0000
Hicks, Muse, Xxxx & Xxxxx Incorporated
000 Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxxx, Xx.
Tel.: (000) 000-0000
Fax: (000) 000-0000
HEARST-ARGYLE STATIONS, INC.
By:
-----------------------------------
Name:
Title:
The undersigned, as issuer of the Shares, hereby acknowledges the grant
of the security interest set forth herein and consents to the rights and
remedies of the Lender provided herein in respect of the Pledged Securities.
STC BROADCASTING OF VERMONT SUBSIDIARY,
INC.
By:
-------------------------------------
Name:
Title:
11
Exhibit A to Pledge Agreement
-----------------------------
STC BROADCASTING OF VERMONT SUBSIDIARY, INC.
, 1998
------------
Hearst-Argyle Stations, Inc.
c/o Hearst-Argyle Television, Inc.
000 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Gentlemen:
Reference is made to the Pledge Agreement dated as of the date hereof
(the "Pledge Agreement") between STC Broadcasting of Vermont, Inc., as pledge
----------------
(the "Pledgor"), and you, as lender. Capitalized terms used but not defined
-------
herein have the respective meanings provided in the Pledge Agreement.
In connection with the pledge of the Collateral to you by the Pledgor,
the undersigned, as issuer of the Pledged Securities, hereby agrees with you as
follows:
(i) To deliver directly to you at your address set forth in the
Pledge Agreement, any and all instruments and/or share certificates
evidencing any right, option or warrant, and all new, additional or
substituted securities issued to, or to be received by, the Pledgor by
virtue of its ownership of those Pledged Securities issued by the
undersigned or upon exercise by the Pledgor of any option, warrant or right
attached to such Pledged Securities;
(ii) Except for distributions permitted pursuant to Section 7.6
of the Credit Agreement, to pay directly to you any and all cash dividends
which might be declared and payable (including any unpaid dividend accrued
prior to the date hereof) on any of such Pledged Securities; and
(iii) At any time upon and during the continuance of an Event of
Default, upon your presentation of executed instruments of transfer or
assignment naming you or your nominee as transferee, together with stock
certificates representing the Pledged Securities (issued by the
undersigned) to be transferred, to register the transfer of such Pledged
Securities to you or your nominee, as applicable, subject to the terms of
Section 17 of the Pledge Agreement and to any restrictions on transfers set
forth in applicable federal or state securities laws.
A-1
In addition, the undersigned agrees that, if at any time you shall
determine to exercise your right to sell all or any of the Collateral, the
undersigned will, upon your request and at the undersigned's expense:
(a) provide you with such other information and projections in
respect of the undersigned as may be necessary or, in your opinion,
advisable to enable you to effect the sale of the Collateral; and
(b) do or cause to be done all such other acts and things
consistent with the terms of the Pledge Agreement as may be necessary to
make such sale of the Collateral or any part thereof valid and binding and
in compliance with applicable law.
You are hereby authorized, in connection with any sale of the
Collateral, to deliver or otherwise disclose to any prospective purchaser of the
Collateral (i) any information provided to you pursuant to subsection (a) above
and (ii) any other information in your possession relating to the undersigned or
the Collateral.
Very truly yours,
STC BROADCASTING OF VERMONT SUBSIDIARY,
INC.
By:
-------------------------------
Name:
Title:
ACKNOWLEDGED, CONSENTED AND AGREED TO:
STC BROADCASTING OF VERMONT, INC.
By:
-----------------------------
Name:
Title:
A-2
INITIAL DISCLOSURE SCHEDULES
WITH RESPECT TO
TELEVISION XXXXXXXXX XXXXXXX
XXXX, XXXXXXX 0, XXXXXXX, XXXXXXXXXX
TO
ASSET EXCHANGE AGREEMENT
DATED AS OF FEBRUARY 18, 1998
BY AND AMONG
STC BROADCASTING, INC.
STC BROADCASTING, OF VERMONT, INC.
STC BROADCASTING OF VERMONT SUBSIDIARY, INC.
STC LICENSE COMPANY, INC.
AND
HEARST-ARGYLE STATIONS, INC.
TERMS AND CONDITIONS
The Disclosure Schedules attached hereto are subject to the following terms and
conditions:
1. The inclusion of any fact or item on a schedule, which schedule requires the
listing of a "material" item, is not deemed to be an admission or representation
that the included item is "material".
2. The inclusion of any fact or item on a schedule referenced by a particular
section in the Asset Exchange Agreement shall, should the existence of the fact
or item or its contents, be relevant to any other section, be deemed to be
disclosed with respect to such other section whether or not an explicit
cross-reference appears.
3. The introductory language and heading to each of the disclosure schedules are
inserted for convenience only and shall not create a different standard for
disclosure than the language set forth in the Asset Exchange Agreement.
4. All capitalized terms used herein and not otherwise defined shall have the
meaning given such terms in the Asset Exchange Agreement.
2
DISCLOSURE SCHEDULES
Schedule 2.3.1 FCC Licenses
Schedule 2.3.2 Real Property Interests
Schedule 2.3.3 Tangible Personal Property
Schedule 2.3.4 Intellectual Property
Schedule 2.3.5 Program Contracts
Schedule 2.3.6 Trade-out Agreements
Schedule 2.3.8 Network Affiliation Agreements
Schedule 2.3.9 Other Operating Contracts
Schedule 2.3.10 Vehicles
Schedule 2.3.12 Auxiliary Facilities
Schedule 2.3.14 Accounts Receivable
Schedule 2.4.13 Shared Contracts
Schedule 2.4.14 Labor Union Contract
Schedule 2.4.15 Excluded Assets
Schedule 2.4.16 Affiliated Transactions
Schedule 3.4 Consents
Schedule 3.5 Financial Statements
Schedule 3.6 Absence of Certain Changes or Events
Schedule 3.7 Litigation
Schedule 3.8 Encumbrances on Assets
Schedule 3.9 FCC Matters
Schedule 3.10 Real Property Documents Delivered & Encumbrances
Schedule 3.14 Employee Benefit Plans
Schedule 3.15 Labor Relations
Schedule 3.16 Environmental Matters
Schedule 3.17 Insurance
Schedule 3.19 Affiliated Transactions
Schedule 12.2 Brokers
3
SCHEDULE 2.3.1
FCC LICENSES
Call Sign Class Expiration Date
--------- ----- ---------------
KSBW-TV Main Broadcast License December 31, 1998
K13GS Translator April 1, 1998 (renewal
application filed 12/1/97-
File No. BRTTV-971201GG
Auxiliaries:
KB-55808 TV Pickup December 1, 1998
KB-55148 TV Pickup December 1, 1998
KB-55150 TV Pickup December 1. 1998
KA-88915 TV Pickup December 1, 1998
KA-59086 TV Pickup December 1, 1998
KR-9885 TV Pickup December 1, 1998
WHY-730 TV Intercity Relay December 1, 1998
WBE-815 TV Intercity Relay December 1, 1998
WHS-279 TV Intercity Relay December 1, 1998
WHS-369 TV Intercity Relay December 1, 1998
WHY-871 TV Intercity Relay December 1, 1998
KMT-27 TV Intercity Relay December 1, 1998
KUQ-36 TV Intercity Relay December 1, 1998
WLD-202 TV Intercity Relay December 1, 1998
WLD-563 TV Intercity Relay December 1, 1998
WLD-570 TV Intercity Relay December 1, 1998
WHG-366 TV Intercity Relay December 1, 1998
WHG-365 TV Intercity Relay December 1, 1998
WHG-368 TV Intercity Relay December 1, 1998
WLD-566 TV Intercity Relay December 1, 1998
WLD-559 TV Intercity Relay December 1, 1998
WGX-279 TV Intercity Relay December 1, 1998
WLI-982 TV Intercity Relay December 1, 1998
KA-88554 Remote Pickup Mobile December 1, 1998
WHB-938 TV Intercity Relay December 1, 1998
KPH-796 Remote Pickup Automatic Relay December 1, 1998
KPH-801 Remote Pickup Automatic Relay December 1, 1998
KPH-797 Remote Pickup Base Mobile System December 1, 1998
KA-88554 Remote Pickup Mobile System December 1, 1998
Note: Certain of the above referenced intercity relay stations (which were
previously used to provide NBC service to KSBY) are no longer operational.
4
SCHEDULE 2.3.2
REAL PROPERTY INTERESTS
Owned Real Property
-------------------
1. Seller owns a studio site (John's Street Studio) more particularly
described as set forth below:
The following land and premises located in the County of Monterey,
State of California:
Parcel I:
---------
Situate in the City of Xxxxxxx, County of Monterey, State of California, and
being a portion of Block 11 as shown on the map entitled "F.S. Spring's Addition
to Salinas City," filed June 7, 1902 in Volume 1, Page 28 of cities and towns,
records of said county and also a portion of Block 3, as shown on the map filed
December 1, 1873 in Volume 1, Page 27 of cities and towns, records of said
county, and also a portion of the land described in the deed to Xxxx Xxxxx, et
ux, dated August 13, 1923 in Volume 40, Page 78, official records of said
county, being contiguous without gaps or gores, described as follows:
Beginning at a 3/4 inch iron pipe standing in the northeasterly line of Xxxxxx
Xxxxxx (a city street 66 feet wide) at the southwest corner of the land
described in the deed to Xxxx X. Xxxxxx, recorded April 5, 1966 in the Reel 456,
Page 144, official records of said county; thence along said northeasterly line
of Xxxxxx Xxxxxx
(1) N. 74(degrees)12' W., 235.40 feet to the intersection with the easterly
line of Xxxxx Xxxxxx (x xxxx xxxxxx 00 feet wide); thence along said
line xx Xxxxx Xxxxxx
(2) N. 15(degrees) 47' E., 253.30 feet to the intersection with the
southwesterly line of Xxxx Street (a city street 80 feet wide); thence
along said line of Xxxx Street
(3) S. 76(degrees) 06' E., 439.56 feet to the intersection with the
southwesterly line of Xxxxxx Xxxxxx (x xxxx xxxxxx 00 feet wide);
thence along said line of Xxxxxx Street
(4) S. 31(degrees) 04' 45" E., 51.28 feet to a 3/4 inch iron pipe at the
most northern corner of the land described in the deed Xxxxxx X. Xxxxx,
et ux, recorded September 28, 1973 in Reel 873, Page 15, official
records of said County; thence along the northwesterly boundary of said
land
(5) S. 68(degrees)06' 50" W., 185.17 feet to the easterly boundary of said
land of Xxxxxx; thence along said easterly boundary
(6) N. 11(degrees)54' 29" W., 11.64 feet to the northeasterly corner
thereof; thence along the northerly boundary of said land
5
(7) N. 74(degrees)09' 41" W., 89.39 feet to the northwesterly corner
thereof; thence along the westerly boundary of said land
(8) S. 15(degrees)46' 33" W., 129.99 feet to the point of beginning
Excepting therefrom that portion of said land described to Xxxxxx Xxxx Xxxxxx
and Xxxxxxx Xxxxxxx Xxxxxxxx, recorded November 20, 1947 in Book 1010, Page 429,
official records.
Also described as Parcel A of map filed March 15, 1983 in Volume 15 of parcel
maps, Page 134, official records of Monterey County, State of California.
A.P. No. 2-382-72
2. Seller owns a transmitter site (Fremont Peak) more particularly described as
set forth below.
Parcel II:
----------
Being a part of that certain parcel of land situate in the Rancho Cienega Del
Gabilan, in the county of Monterey, State of California, designated as "Parcel
One" in deed to Xxxxxx Xxxxxx, dated June 3, 1929 and recorded in Volume 914,
Page 236, official records of said County, being contiguous without gaps or
gores, described as follows:
Beginning at a point in the southeasterly boundary of and land designated
"Parcel VI" in the deed to the County of San Xxxxxx, dated June 22, 1931 and
recorded in Volume 393, Page 246, official records of said County, from which a
brass capped 6" diameter concrete monument standing at the most southerly corner
of said land bears along said boundary S. 50(degrees) 52' 54" W., 273.68 feet;
thence along said boundary
(1) N. 50(degrees) 52' 54" E., 276.81 feet at 83.32 feet another
brass-capped 6 inch diameter concrete monument, 276.81 feet to a point;
thence along the westerly line of a 40' road
(2) S. 11(degrees)31' 23" E., 60.76 feet, at 1.28 feet a 1/2" diameter iron
pipe, 60.76 feet to a 2" by 3" redwood post, thence
(3) S. 7(degrees) 42' 37"W., 136.79 feet to a 1/2" diameter iron pipe from
which a 2" x 3" redwood post bears along said westerly line S. 7
(degrees) 42' 37" W., 36.53 feet; thence leave said line
(4) S. 50(degrees) 53' 37" W., 137.42 feet, to a 1-1/2 inch iron pipe in
the easterly line of said road, from which a 3/4" diameter iron pipe
bears along said line S. 47(degrees) 42' 23" E., 25.28 feet; thence
along said easterly line
(5) N. 43(degrees)34' 23" W., 147.85 feet, at 147.75 feet a 3/4" diameter
iron pipe 147.85 feet to the place of beginning
A.P. No. 000-000-00
6
Parcel III:
-----------
An easement for road, poles, power, water and pipelines and any necessary
utilities purposes, 40 feet wide, lying along, contiguous to and easterly of
courses number (2) and (3) above, being contiguous without gaps or gores, and
particularly described as follows:
Beginning at the most northerly corner of the above described tract of land and
running thence, along the easterly boundary thereof,
(1) S. 11(degrees)31' 23" E., 60.76 feet to a 2" x 3" redwood post; thence
(2) S. 7(degrees)42' 37" W., 136.79 feet to a 1/2" diameter iron pipe.
Parcel IV:
----------
An easement for road, poles, power, water and pipelines and any necessary
utilities purposes, 40 feet wide, lying along, contiguous to and southwetserly
of Course Number (5) above, being contiguous without gaps or gores, and
particularly described as follows:
Beginning at the most southerly corner of the above described tract of land and
running thence, along the southwesterly boundary thereof,
(1) N. 43(degrees)34' 23" W., 147.85 feet to the most westerly corner
thereof.
Parcel V:
---------
An easement for road, poles, power, water, and pipelines and necessary utilities
purposes 40 feet wide being contiguous without gaps or gores, lying along,
contiguous to and southwesterly, southerly and southeasterly of the following
described line:
Beginning at the most southerly corner of Parcel 2 herein described above;
thence
(1) S. 47(degrees) 42' 23" E., 25.28 feet; thence
(2) S. 58(degrees) 36' 23" E., 31.53 feet, thence
(3) S. 86(degrees) 24' 23" E., 29.91 feet; thence
(4) N. 38(degrees) 12' 37" E., 28.62 feet; thence
(5) N. 7(degrees) 42' 37" E., 100.41 feet to the angle point formed by
courses numbered "(3)" and "(4)" in the boundary of the above described
Parcel II.
7
3. Seller owns a transmitter site (Summit Road) more particularly described as
set forth below:
All that certain real property in the unincorporated area, County of Santa
Xxxxx, State of California, being contiguous without gaps or gores, described as
follows:
Parcel One:
The north half of the southwest quarter of Section 17, Township 10 South, Range
2 East, M.D.B. & M., excepting therefrom that portion thereof lying within Santa
Xxxx County.
Parcel Two:
The southeast quarter of the southwest quarter and the east half of the east
half of the southwest quarter of the southwest quarter of Section 17, Township
10 South, Range 2 East, M.D.B. & M., excepting therefrom that portion thereof
lying within Santa Xxxx County.
Parcel Three:
The southwest quarter of the southeast quarter of Section 17 and Xxx 0 xx
Xxxxxxx 00, Xxxxxxxx 00 Xxxxx, Xxxxx 2 East, M.D.B. & M., excepting therefrom
that portion thereof lying within Santa Xxxx County.
Parcel Four:
All that certain real property in the unincorporated area, County of Santa Xxxx,
State of California, being contiguous without gaps or gores, described as
follows:
All that portion of the northwest quarter of the southwest quarter of
Section 17, Township 10 South, Range 2 East, M.D.B. & M. lying southwest of the
centerline of Summit Road.
Leased Real Property
3. License agreement dated May 1, 1983 with Allnet Communications Services,
Inc..
4. License Agreement dated June 1, 1989 with Xxxxxxx X. Xxxxxx.
5. Commercial Lease Agreement dated June 1, 1992 with Xxxxxxx and Eva
Boronfield.
6. Lease agreement dated July 25, 1990 with Gibson, Riordan, Xxxxxxx and
Xxxxx d/b/a Braniforte Plaza.
7. Lease agreement dated May 25, 1964 with Xxxxxx Xxxxxx.
8. Permit for Right of Way dated November 15, 1994 with the State of
California, acting through the Department of Parks and Recreation.
8
9. Lease agreement dated February 1, 1992 with the State of California, acting
through the Director of General Services.
10. Lease Agreement dated August 1, 1997 with Heritage Harbor.
Other Interests
---------------
See the fixed asset list attached to Schedule 2.3.3 to the extent it contains
any fixtures or other interests in real property.
9
SCHEDULE 2.3.3
TANGIBLE PERSONAL PROPERTY
(see attached)**
1. The attached fixed asset appraisal as of March 1, 1997, includes two
sections of equipment (Spare Parts and Surplus) which are not presently
used in the Station operation.
2. Since acquisition of the Station by STC Broadcasting, Inc., the Station has
replaced items of equipment and has retained such replaced equipment in
storage or disposed of it as outlined on the attached.
3. See attached schedule of capital expenditures for period 3/1/97 to 12/31/97.
------------------
** Attachments previously delivered to HAT and not included herein.
10
SCHEDULE 2.3.4
INTELLECTUAL PROPERTY
Trade Names Trademark
----------- ---------
Action News No
Coverage You Can Count On No
This schedule incorporates by reference all other contracts and rights of Seller
to use trademarks, trade names, service marks and other intellectual property
under the contracts set forth in Schedules 2.3.5, 2.3.6 and 2.3.8 and 2.3.9.
11
SCHEDULE 2.3.6
TRADE-OUT AGREEMENTS
Consent
SCHEDULE 2.3.5
PROGRAM CONTRACTS
Start End Consent
Contracting Party Program Date Date Necessary
----------------- ------- ----- ---- ---------
King World Jeopardy * 9/97 9/99 Yes
King World Weekend Jeopardy 9/97 9/99 Yes
King World Oprah 9/97 9/2000 Yes
King World Wheel * 9/97 9/99 Yes
King World Weekend Wheel 9/97 9/99 Yes
King World Mr. Food 1/98 12/99 Yes
Xxxxxx Prog Services CNN News Product 1/98 12/98 Yes
Twentieth Television NYPD Blue 9/97 9/99 Yes
Warner Bros. Xxxxx X'Xxxxxxx 9/97 9/2000 No
Warner Bros. Warner Bros, Vol 28 9/90 9/98 Yes
Warner Bros. Warner Bros, Vol 29 9/90 9/2002 Yes
Warner Bros Warner Bros, Vol 31 1/94 11/2008 Yes
Columbia Tristar Xxxxxx & Xxxxx 9/98 9/2000 No
BARTER PROGRAM
--------------
All American Baywatch 9/97 9/98 No
Warner Bros. Extra 9/98 9/2000 No
Buena Vista Television Honey I Shrunk the Kids 9/97 9/98 Yes
Warner Bros. Xxxxx Xxxxx 9/97 9/98 No
Warner Bros. Xxxxxx 9/97 6/99 Yes
Warner Bros. Xx. Xxxxxx 9/97 9/98 Yes
Twentieth Television Real Stories 9/97 9/98 Yes
The Phoenix Communications Sports News Satellite 9/95 9/2001 No
Dow Xxxxx & Company, Inc. Wall Street Journal 9/97 9/98 Yes
* Commitments:
------------
Xxxxx XxXxxxxxxx has signed a letter of intent and is awaiting final
contracts through the fall of 2002, however, the actual contracts have not
been signed. The reason is the omission, by King World, of co-op dollars
language that has existed in the current contracts. Though we have not
utilized this co-op to date, we did not want to lose having the option to do
so in the future.
12
SCHEDULE 2.3.6
TRADE-OUT AGREEMENTS
Consent
Contracting Party Description Term Necessary
----------------- ----------- ---- ---------
Active Media Xxxx Xxxxx 8/1/97 to 7/31/98 No
Services
Cash Plus K Mart 2 hour movies 9/15/97 to 6/98 No
El Palomar Food and beverage in 3/20/95 through 12/31/96 No
exchange for airtime Expired but ongoing until
balance used up
Pacific Xxxx Xxxx Payor 1/13/97 to 12/31/98 No
TBS Media
PaLapas Restaurant Food credit 1/1/97 to 12/31/97 No
Expired but ongoing until
balance used up
Pebble Beach Co. Awards Dinner 10/18/97 to 10/17/98 No
Jefferson Awards
Sanctuary Day Spa Day spa tickets 11/28/97 to 12/24/98 No
Seacliff Inn Banquet and restaurant 3/17/97 to 12/31/97 No
usage in exchange for
television airtime
SeaSide Associates Amusement Park 1/1/98 to 12/31/98 No
Santa Xxxx
Tower Media Airfare and Hotel 3/21/95 through 3/21/00 No
(for Lucky Stores) accommodations in exchange
for television airtime
Active Media Payment of Media Data 12/29/97 to 12/28/98 No
Services bills 2 for 1
Universal Internet Website Services 3/24/97 to 12/31/97 No
On going at this time.
No new agreement signed
for 1998.
13
SCHEDULE 2.3.8
NETWORK AGREEMENTS
Contracting Consent
Party Description Term Necessary
----------- ----------- ---- ---------
National Broadcasting Network Affiliation 1/17/96 - 12/31/05 Yes, plus
Company, Inc. Agreement additional
requirements
set forth in
Section 16 of
the agreement.
NBC News Channel, Inc. NBC News Channel 1/1/91 Renewed in 52 Yes
Participation Agreement week terms. Cancelable
by written notice 60 days
prior to the last Friday
in June or December.
NBC News Channel, Inc. "Nightside" License 11/4/91 through 11/3/93 Yes, plus
Agreement renewable in 2 yr terms. (i) notice
Can cancel in writing at requirement
least 180 days prior to (ii) NBCNC
end of term. can terminate
see section 13)
National Broadcasting News Excerpt License 1/1/91 renews in 52 week Yes
Agreement terms. Cancelable by
written notice 60 days prior
to the last Friday in June or
December.
14
SCHEDULE 2.3.9
OPERATING CONTRACTS
1. General
Consent
Contracting Party Description Term Necessary
----------------- ----------- ---- ---------
American Society of Music License 3/1/97 to 3/31/98 No
Composers, Authors and Agreement including
Publishers option for per program
method for computing
license fees
Automated Weather Source Weather Stations System 3/8/95 through 3/7/98 Yes
renewable in 1 year terms
X.X. Xxxxxxx Company Audience Ratings 11/1/93 through 12/31/00 No
Service Agreement
X.X. Xxxxxxx Company S.T.A.R. Sales/Audience 3/25/94 through 3/24/97 Yes
Research Information
Bay City News News Service 1/1/98 to 12/31/98 No
renewable in one year terms
Broadcast Music, Inc. Music License Agreement No
including per option
program method for
computing license fees
Cellular One Cellular Phone Rental Ongoing until written Yes
and/or Service notice of cancellation
Agreements is given
Columbine Systems, Inc. Data Processing System 4/1/96 to 3/30/2001 Yes
License Agreement
Columbine/BMP BMP Sales Software 6/1/95 to 5/31/98 No
License Agreement
First Com Music Compact Disc 1/1/97 to 12/31/99 Yes
Library
Xxxxx Xxxxx & Associates News Consultant 6/1/97 to 12/31/99 No
International Business Operating System and Ongoing - Cancelable Yes
Machines Corporation Utility Software License upon one month prior
Agreement written notice
15
Consent
Contracting Party Description Term Necessary
----------------- ----------- ---- ---------
KCBA TV Shared use of Fremont 7/1/95 through 7/1/97 No
Peak right of way permit
Xxxxxxxx, Inc. Meteorological Services Ongoing No
Agreement (including
addendum for additional
services)
Xxxxx Xxxxxxx & Company, Sales Research Services 4/1/97 to 3/31/99 No
Incorporated Agreement
Lexus Financial Services General Manager Auto 2/17/96 to 2/15/99 No
Monterey Bay Office Products Copier Lease 3/1/96 through 2/28/01 No
Monterey Bay Office Products Copier Lease 8/1/97 to 7/31/2000 No
MRI Music License Reporting 1/1/98 to 12/31/98 No
Cancelable 30 days notice
NAACP and Lulac Minority Employment 7/13/94 No
Interns Meetings to 12/1/98 agreement
must be assumed by individual/
corporation acquiring the station
Xxxx & Associates Television Broadcast 1/1/98 to 12/31/98 No
Sales Training
OMNIMUSIC Music License 9/1/95 through 8/31/98 No
Agreement
SESAC, Inc. Music License 2/28/97 through 12/31/2000 No
Agreement
P. Xxxxx Xxxxx Gardens News Service 1/1/98 to 12/31/98 No
Summit Road Association Road Maintenance Ongoing No
Agreement for Mt.
Xxxxxxx Tower Site
Telerep, Incorporated National Sales 11/21/97 to 6/14/2000 No
------- Representation
Agreement
Tribune - News In Motion News Service 1/1/98 to 12/31/98 No
16
Consent
Contracting Party Description Term Necessary
----------------- ----------- ---- ---------
The Associated Press AP NewsPower Wire 1/17/96 through 6/30/98 No - however, Successor
Service Agreement renews automatically for must apply for new AP
successive two year membership
periods unless canceled
by six months prior written
notice
The Associated Press APTV Service 1/17/96 through 6/30/98 No - however Successor
Agreement renews automatically for must apply for new A.P.
successive two year membership and
periods unless canceled expressly assumes all
by six months prior obligations under the
written notice contract
The Associated Press AP Newscenter 1/17/96 through 6/30/98 No - however Successor
Supplemental Software Coterminous with main must apply for A.P.
License Agreement membership agreement membership and
expressly assumes all
obligations under the
contract
The Associated Press APTV Supplemental 1/17/96 through 6/30/98 No - however Successor
Software Coterminous with main must apply for A.P.
membership agreement membership
The Associated Press News Desk Software 1/17/96 through 6/30/98 No - however Successor
Agreement Coterminous with main must apply for new A.P.
membership agreement membership and
expressly assumes all
obligations under the
contract
The Associated Press AP Membership 1/17/96 through 6/30/98 No - however, Successor
Agreement for renews automatically for must apply for A.P.
Television successive two year terms membership
unless cancellation by
six months prior written
notice
The Xxxxx Company Consultant and Agent 11/1/97 through 10/30/98 No
for CA Unemployment Automatically renewed
Tax Matters for 1 year periods.
Cancelable on by 60 days
written notice
17
2. Lease Agreements where Station is Lessor of Real Property
Consent
Contracting Party Location Term Necessary
----------------- -------- ---- ---------
Frontier Communications Tower Space and 10/1/97 through 9/30/98 No
Services, Inc. Equipment Room
Attn: Xxxxxx X. Xxxxxxx Space at 238 Xxxx
Lease Administrator Street Microwave
00000 Xxxxxxxxx Xxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Frontier Communications Land Lease-Fremont 8/1/94 through 7/31/99 No
Services, Inc. Peak to erect tenant has option to terminate
Attn: Xxxxxx X. Xxxxxxx Microwave Relay after 7/31/96 upon 60 days
Lease Administrator Tower and small prior written notice to
00000 Xxxxxxxxx Xx. Equipment Building Lessor
Xxxxxxx Xxxxx, XX 00000
Xxxxx Broadcasting Corp Tower Space on 11/1/95 through 10/31/2005 No
(as successor to Grace KSBW's backup
Broadcasting Corp) tower site and space
KDON-FM in equipment room -
0000 Xxxxxxx Xxxxxx Xxxxxxx Xxxx, XX
Xxx Xxxxxxxxx, XX 00000
Nextel of California Land Lease - 6/1/93 through 5/31/98 No
3675 Mr. Diablo Blvd. Fremont Peak, CA extendable by tenant for an
Suite 330 site for Equipment additional five year period
Xxxxxxxxx, XX 00000 Building
Telecommunications Fremont Peak, CA 3/1/86 through 2/28/96 No
Properties Communications extendable by Telecom.
0000 Xxxxxxxxx Xxxx Xx Lease and Site Properties for two
Ste 200 Management consecutive ten year
Pt. Xxxxxxxx, XX 00000 Agreement periods
Telecommunications Summit Road, CA 1/15/86 through 1/15/96 No
Properties Communications extendable by Telecom.
0000 Xxxxxxxxx Xxxx Xxxx Lease and Site Properties for two
Suite 200 Management consecutive ten year
Pt. Xxxxxxxx, XX 00000 Agreement periods
18
Consent
Contracting Party Location Term Necessary
----------------- -------- ---- ---------
ICO Network Equipment Room 10/1/97 to 9/30/99 No
0000 Xxxxxx Xxxxxx Xx., space at 000
#000 Xxxx Xxxxxx
Xxxxxx Xxxxxx, XX 00000
Xxxxx Xxxx Duznica, xx.xx. Road Lease - 9/23/87 through 9/22/17 No
Summit Road Tower extendable by tenant for an
Tower Site additional ten year period
Monterey-Carmel Antenna Space Lease 1/15/96 to 1/14/2006 No
Communications Corp. Fremont Peak, CA
DBA Repenter
Communications of Monterey
000 Xxxxxxx Xxx.
Xxxxxx, XX 00000
19
3. Lease Agreements where Station is Lessee of Real Property
Consent
Contracting Party Location Term Necessary
----------------- -------- ---- ---------
Xxxxxxx X. Xxxxxx Xxxxxx Road 6/1/89 through 6/1/04 No
15287 Penetencia Microwave Relay however, landlord retains
Creek Road, Site right to revoke agreement
Xxx Xxxx, XX 00000 at any time upon 120 days
notice and licensee can terminate
at any time upon 60 days
notice if site is no longer feasible
Xxxxxxx and Xxx Xxxxxx Bureau 9/1/96 to 8/31/97 on Yes
Xxxxxxxxxx 0000 Xxxxxxxx Xx month to month basis
0000 Xxxxxxxx Xx. Xxxxx 0
Xxxxxx, XX Gilroy, CA
Gibson, Riordan, Xxxxxxx
and Xxxxx d/b/a
Xxxxxxxxxxx Xxxxx
x/x
Xxx Xxxxxxxx Xxx 000-Xxxxxxxxxxx 7/1/97 to 6/30/98 Yes
R.G. Xxx Xxxxxxxx & Plaza, 555 Soquel month to month basis
Associates Avenue, Santa Xxxx,
0000 Xxxxx Xxxxxx XX 00000
Xxx Xxxx, XX 00000 Santa Xxxx Bureau
Xxxxxx Xxxxxx K13GS Translator 2/28/64 through 2/28/99 Yes
Xxxxx Xxxxxx Xxxxx Xxxx
Xxxxxx Xxxxxx, XX 00000 Carmel Valley, CA
Department of Parks and Fremont Peak 11/15/94 to 11/15/99 Yes
Recreation State Park
State of California
Heritage Harbor Monterey News and 7/15/97 to 7/14/2000 Yes
Sales Office
20
4. Cable Must Carry / Retransmission Agreements
See FCC Memorandum Opinion and Order dated 2/12/96
Expiration Consent
Contracting Party Description Date Necessary
----------------- ----------- ---- ---------
TCI Monterey/Salinas Retransmission Consent December 31, 2000 No
Scotts Valley/Santa Xxxx Retransmission Consent December 31, 1999 No
San Xxxx Must Carry December 31, 1999 No
Los Altos Cupertino Retransmission Consent December 31, 1999 No
Merced Retransmission Consent December 31, 1999 No
Xxxxxx Hill Must Carry December 31, 1999 No
Los Gatos Must Carry December 31, 1999 No
Gilroy Must Carry December 31, 1999 No
San Xxxxxx Must Carry December 31, 1999 No
Mont Xxxxxxx Must Carry December 31, 1999 No
Saratoga Must Carry December 31, 1999 No
Xxxxxxxx Must Carry December 31, 1999 No
Cupertino Must Carry December 31, 1999 No
Matrix Saratoga Retransmission Consent December 31, 1999 No
Coastside Fort Ord/Marina Retransmission Consent December 31, 1999 No
Coastside Presidio Retransmission Consent December 31, 1999 No
Coast Cable San Xxxx Retransmission Consent December 31, 1999 No
Weststar Xxxxxx Retransmission Consent December 31, 1999 No
Optel/SanFrancisco Retransmission Consent December 31, 1999 No
Sonic Xxxxxxxxxx Retransmission Consent December 31, 1999 No
Sonic Capitola Retransmission Consent December 31, 1999 No
Sonic Watsonville Retransmission Consent December 31, 1999 No
Sonic Parajo Dunes Retransmission Consent December 31, 1999 No
Sonic Santa Xxxx County Retransmission Consent December 31, 1999 No
Falcon Hollister Retransmission Consent December 31, 1999 No
Falcon Oak Hill Retransmission Consent December 31, 1999 No
Falcon Laguna Seca Retransmission Consent December 31, 1999 No
Falcon Watsonville Retransmission Consent December 31, 1999 No
Falcon Xxxx Landing Retransmission Consent December 31, 1999 No
Falcon Tierra Grande Retransmission Consent December 31, 1999 No
Falcon Monterey Retransmission Consent December 31, 1999 No
Falcon Castroville Retransmission Consent December 31, 1999 No
Falcon Salinas Retransmission Consent December 31, 1999 No
Falcon Carmel Valley Retransmission Consent December 31, 1999 No
Falcon Aromas Retransmission Consent December 31, 1999 No
Falcon Carmel Highlands Retransmission Consent December 31, 1999 No
Xxxxxx Xxxxxxx Retransmission Consent December 31, 1999 No
Falcon San Xxxx Xxxxxxxx Retransmission Consent December 31, 1999 No
Falcon Los Lomas Retransmission Consent December 31, 1999 No
Falcon Hidden Hills Retransmission Consent December 31, 1999 No
Falcon Ridgemark Retransmission Consent December 31, 1999 No
21
Expiration Consent
Contracting Party Description Date Necessary
----------------- ----------- ---- ---------
Falcon La Mesa Village Retransmission Consent December 31, 1999 No
Falcon Conzoles Retransmission Consent December 31, 1999 No
Falcon Gilroy Retransmission Consent December 31, 1999 No
Falcon San Xxxxxx Retransmission Consent December 31, 1999 No
Falcon Morgan Hill Retransmission Consent December 31, 1999 No
Falcon Pine Canyon Retransmission Consent December 31, 1999 No
Falcon Greenfield Retransmission Consent December 31, 1999 No
Falcon King City Retransmission Consent December 31, 1999 No
22
5. Employment Contracts
Start and End Consent to
Employee Name Job Title Dates of Contracts Assignment Required
------------- --------- ------------------ -------------------
Xxxxx Belyn Assignment Editor 1/5/98 through 1/4/2000 No
Xxxxxxx Xxxx 5 pm News Anchor 5/16/96 through 5/15/98 No
Xxxx Xxxxxxxxx Anchor/Reporter 2/7/97 through 2/6/99 No
Xxxx Xxxxx Primary Anchor 2/2/98 through 2/2/2001 No*
Xxxxx Xxxxx News Director 5/31/95 through 5/30/98 No
Xxxx Xxxxxxx Anchor Reporter 9/16/95 through 9/15/98 No
Xxxxx Xxxxxx Reporter 5/15/96 through 4/21/98 No
Xxx Xxxxx Primary Anchor 10/1/97 through 9/30/2000 No
Xxx Xxxxxxxx Reporter 6/4/97 through 6/3/99 No
Xxxxxxxx Xxx News Producer 7/22/97 through 7/21/99 No
Xxxxxx Xxxxxx Primary Sports Anchor 3/5/97 through 3/31/99 No
Xxxxx Xxxxx W/E Anchor/Reporter 12/12/97 through 12/11/99 No
Xxxxx Xxxx Weather 10/15/97 through 10/2/98 No
Xxxxxxx XxXxxx News Producer 6/18/97 through 6/22/99 No
Xxx X. Xxxxx III Anchor/Reporter 4/22/96 through 4/21/98 No
Xxxxx Xxxxxx News Producer 3/6/97 through 3/9/99 No
Xxxxxx Xxxxxxxx Anchor/Reporter 12/12/97 through 12/11/2000 No
Xxxx Xxxxxxxxxx News Producer 11/20/97 through 11/30/98 No
Xxxx Xxxxxx News Producer 9/9/96 through 9/13/98 No
Xxx Vanderzwaan Primary Weather Anchor 3/1/96 through 2/28/99 No
Xxxxxxx Xxxx Reporter 3/12/97 through 2/16/99 No
* Draft terms for new main anchor
6. Collective Bargaining Agreements
None
23
SCHEDULE 2.3.10
VEHICLES
MAKE/MODEL IDENTIFICATION CODE
----------- -------------------
1995 CHEVY LUMINA 0XXXX00X0XX000000
1994 CHEVY VAN 0XXXX00X0XX000000
1994 TOYOTA 4 RUNNER XX0XX00X0X0000000
1994 FORD ESCORT 0XXXX00X0XX000000
1993 FORD VAN 0XXXX00XXXXX00000 (Live Truck)
1993 NISSAN PATHFINDER XX0XX00X0XX000000
1992 FORD AEROSTAR 0XXXX00X0XXX00000
1991 DODGE SPIRIT 0X0XX00X0XX000000
0000 XXXXXX XXXXXXX XXXXX XX0XX00X0X0000000
1996 LEXUS ES300 XX0XX00X0X0000000 (Leased)
1993 CHEVY S10 BLAZER 0XXXX00XXX0000000
1996 TOYOTA RAV4 XX00X00X0X0000000
1980 FORD VAN S34ZHJ65732
1996 TOYOTA RAV4 XX0XX00XXX0000000
1996 FORD VAN 0XXXX0000XXX00000 (Live Truck)
1997 MERCURY TRACER 0XXXX00X0XX000000
1997 ISUZU RODEO 4WD 452CM58VO43306778
1996 TOYOTA RAV4 JT36TP10VXT7004780
1997 TOYOTA RAV4 XX0XX00X000000000
24
SCHEDULE 2.3.12
AUXILIARY FACILITIES
Carmel Valley, CA - translator sight K136S
Fremont Peak - backup tower
Pal Escrito, CA - Microwave relay site
Xxxxxx Road - Microwave relay site
Monterey Street, Gilroy, CA - Gilroy Bureau
Xxxxxxxxxxx Plaza, Santa Cruz, CA - Santa Xxxx Bureau
Heritage Harbor, Monterey, CA - Monterey Bureau
25
SCHEDULE 2.3.14
ACCOUNTS RECEIVABLE
See Attached:**
------------
Schedule of Receivables at 12/31/97
Aging of Trade Receivables at 12/31/97
Bad Debt analysis at 12/31/97
------------------------------------
** Attachments previously delivered to HAT and not included herein.
26
KSBW-TV
ACCOUNTS RECEIVABLE
DECEMBER 31, 1997
Accounts Receivable - station cash $2,703,049.67
Network Receivable 27,463.00
Coop Receivable 10,000.00
Employee Receivable 1,533.00
Accounts Receivable - other 28,185.68
Unbilled revenue 71,686.10
Allowance for doubtful accounts (48,827.12)
-------------
$2,793,090.63
=============
27
SCHEDULE 2.4.13
SHARED CONTRACTS
X.X. Xxxxxxx Contract was a SCI Television contract. Xxxxxxx has honored the
terms of the agreement through the various owners since SCI ownership was sold.
The Associated Press Agreements are STC contracts. Our rates reflect reduced
amounts due to ownership of multiple stations using AP. These same discounts are
available to Hearst-Argyle Stations, Inc.
See Schedule 2.4.16.
28
SCHEDULE 2.4.14
LABOR CONTRACTS
NONE
29
SCHEDULE 2.4.15
EXCLUDED ASSETS/CONTRACTS
NONE
30
SCHEDULE 2.4.16
AFFILIATED TRANSACTIONS
1. Employee Benefit Program
---------------------------
KSBW has elected to be a participating affiliate in certain Sunrise Television
Corp employee benefits programs. KSBW is charged the same amount as any
participating affiliate and contributes to the costs of audits on the 401(k)
Plan and Benefit Trust. Sunrise Television Corp. or its employees do not receive
any compensation from any participating affiliate for services rendered. As long
as a participating affiliate elects to participate in the Great West Health,
Life and/or Dental Plan, the administrative costs normally charged by Great West
Life Assurance to the 401(k) plan is waived.
2. General Insurance
------------------
Station has elected to participate in the Hicks, Muse, Xxxx & Xxxxx insurance
program. Station is billed actual premium costs incurred. Hicks, Muse, Xxxx &
Xxxxx and its employees receive no compensation for providing this service.
3. Allocation of V.P. News Salary
-------------------------------
KSBW-TV has agreed as long as Ms. Xxxxx Xxxxxxx is employed by WROC-TV to
contribute $7,500 annually towards her total compensation. Xx. Xxxxxxx provides
news consulting services to KSBW. Any travel costs of Xx. Xxxxxxx to KSBW are
paid by KSBW.
31
SCHEDULE 3.4
CONSENTS
1. See Schedule 2.3.5
2. See Schedule 2.3.6
3. See Schedule 2.3.8
4. See Schedule 2.3.9
32
SCHEDULE 3.5
FINANCIAL STATEMENTS
. Summary and detailed balance sheet as of December 31, 1997
. Summary and detailed statement of operations for the 10 months ended
December 31, 1997.
. Summary and detailed balance sheet as of February 28, 1997.
. Summary and detailed statement of operations for the two months ended
February 28, 1997.
. Summary and detailed balance sheet as of December 31, 1996.
. Summary and detailed statement of operations for the period 1/3/96 to
12/31/96.
33
SCHEDULE 3.6
ABSENCE OF CERTAIN CHANGES OR EVENTS
If not offered employment by Hearst-Argyle Stations, Inc. at closing, STC
Broadcasting, Inc. has agreed with Xxxxxx Xxxx, general manager of KSBW-TV, that
they will pay him one year severance.
34
SCHEDULE 3.7
LITIGATION
Xxxxxxx Xxxxxxxxxx of Xxxxxx, Xxxxxxxxxx and Xxxxxx, a law corporation, sent a
letter to Xxxxxx Xxxx on December 22, 1997, indicating that he represented Xx.
Xxxxx Xxxxxxxx, a former employee of the station. The letter indicated that Xx.
Xxxxxxxx had not been paid for all of her overtime, a minimum of 320 hours and
for wrongful termination. On January 2, 1998, our attorney, Xxxxxxxx Xxxxxxx
responded indicating that she did not have a contract, that the station had paid
all overtime and that she was terminated because her performance was not at
acceptable levels. In our letter of January 2, 1998, we requested additional
information related to her alleged claims. See attached letters.
35
[LETTERHEAD OF FERRARA, FIORENZA, XXXXXXXX, XXXXXXX & XXXXX, P.C. APPEARS HERE]
January 2, 1998
Via facsimile at (000) 000-0000
and U.S. Mail
Xxxxxxx X. Xxxxxxxxxx, Esq.
Xxxxxx, Xxxxxxxxxx & Xxxxxx
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxxx Xxxxxx, XX 00000-0000
Re: Xxxxx Xxxxxxxx and KSBW-TV
Dear Xx. Xxxxxxxxxx:
This office represents the STC Corporation, owner and operator of KSBW-TV
and the undersigned provides assistance to it in connection with certain
personnel and labor relations matters. Xxxxxx Xxxx, President and General
Manager of KSBW, has forwarded a copy of your letter dated December 22, 1997,
regarding the above matter to my attention for review and response.
We have consulted with our clients concerning the claims made in your
letter. Our clients advise that Xx. Xxxxxxxx was not serving under any contract
of employment. They further advise that Xx. Xxxxxxxx was terminated when it was
determined that she was not performing at acceptable levels and further, after
she was given opportunities to improve her performance.
At the time of her termination, Xx. Xxxxxxxx was given the opportunity to
resign with a severance package, and chose not to do so.
. Regarding Overtime Claims
-------------------------
According to our clients, Xx. Xxxxxxxx was paid all sums due her at the
time of termination. She was asked to provide the Station with any claims
she may have made for any such work for which she was not compensated. She
did so and the Station paid her accordingly. The Station is at a loss as to
her new claim of "320 hours" overtime. If you would provide me with
documentation (particularization as to date, time and services
Xx. Xxxxxxxxxx
January 2, 1998
Page 2
allegedly performed by Xx. Xxxxxxxx while in the employ of KSBW) that
covers such claims, I will review same with my clients.
. Regarding Refusal to Pay Overtime When Requested
------------------------------------------------
My client is unable to identify any instances when Xx. Xxxxxxxx allegedly
requested overtime compensation and was improperly refused same. If you
will provide me with particularization concerning this claim(s), I will be
happy to review it with my clients.
. Regarding Termination
---------------------
The Station feels it acted properly with respect to Xx. Xxxxxxxx'x
termination. Therefore, we are at a loss to understand your claim that she
was "wrongfully terminated." Please provide me with the factual and legal
basis for such a claim and I will review same with my client.
Under the condition stated in your letter to Xx. Xxxx, please treat this
correspondence as a rejection of your demands. However, I will be happy to
further discuss this matter, if you choose to supply the information referred to
above.
Thank you.
Very truly yours,
Xxxxxxx, Xxxxxxxx, Xxxxxxxx, Xxxxxxx & Xxxxx, P.C.
/s/ Xxxxxxxx X. Xxxxxxx
Xxxxxxxx X. Xxxxxxx
BJF/cmb
cc: Xxxxxx Xxxx, President and General Manager, KSBW
Xxxxx Xxxx, Executive Vice President and Chief Financial Officer, STC
[LETTERHEAD OF XXXXXX, PASSAFUIME & XXXXXX APPEARS HERE]
December 22, 1997
Xxx Xxxx
KSBW
000 Xxxx Xx.
Xxxxxxx, XX 00000
Re: Xxxxx Xxxxxxxx
Dear Xx. Xxxx,
Please be advised that this law firm represents Xx. Xxxxx Xxxxxxxx with
reference to her employment with Channel 8 News. She was recently terminated
from her employment and was Issued a check which did not compensate her for
overtime hours worked over the period of time she was employed by the station.
I have reviewed Xx. Xxxxxxxx'x records, including her calendar and other
logs. She can easily demonstrate by way of clear time records that she worked a
minimum of 320 hours of overtime for which she was not compensated. She is
clearly a non-exempt employee and is entitled to be compensated at the rate of
time-and-a-half the normal rate of pay. Your handbook, provided for
informational purposes to employees, specifies overtime pay for non-exempt
employees. In addition, Xx. Xxxxxxxx has been treated as a non-exempt employee
in the past by KSBW, and meets the criteria as specified by the Court. (See
Xxxxxxxxx v XxXxxx (1995) 32 Cal.App.4th 555.). In addition, Xx. Xxxxxxxx is
------------------
entitled to reasonable attorneys fees in collecting her unpaid overtime.
When our client was hired at KSBW, she was assured that she would be given
one of the anchor jobs. In reliance upon those assurances, she moved from
Houston to take the job at KSBW. Over the next two years, she was passed over
several times for open anchor positions. When she did fill-in, she was commended
for doing a good job, and was asked to "fill-in" again, but with no overtime
pay. She was refused overtime pay when she requested it, and was finally
terminated after "sufficient review and investigation."
Please consider this letter our demand for payment for overtime for 320
hours at time and one-half for a total of $6,678.00, as well as $1,500.00 for
interest and attorneys fees. Further demand is made in the sum of $28,000 for
the wrongful termination of Xx. Xxxxxxxx. This demand shall remain open for 10
days from the date of this letter, and if not fully accepted shall be deemed
rejected.
Please contact me if you would like to discuss this matter further.
Very truly yours,
/s/ Xxxxxxx X. Xxxxxxxxxx
XXXXXXX X. XXXXXXXXXX
PAP/wjc
cc: client
SCHEDULE 3.8
ENCUMBRANCES ON ASSETS
Permitted Encumbrances
----------------------
1. See Schedule 3.4
2. See Schedule 3.10
36
SCHEDULE 3.9
FCC MATTERS
Xxxxxx X. Xxxxx, the ultimate controlling partner of STC Broadcasting
and STC License Company, and certain of his associates, have attributable
interests in the following stations that implicate the FCC's ownership
restrictions:
WYGY-FM, Hamilton, OH -- WDTN-TV's Grade A signal encompasses all of
Xxxxxxxx thereby requiring a one-to-a market waiver of (S)73.3555(c) of
the FCC's Rules.
WISH-TV, Indianapolis, IN -- There is Grade B overlap between this
station and WDTN-TV, but no Grade A overlap. Assuming completion of the
LIN Television Corp. transfer of control that is presently pending, a
waiver of (S)73.3555(b) (the duopoly rule) will be required. A
temporary waiver conditioned on the outcome of the pending rulemaking
will be requested.
WING-FM, Springfield, OH -- An application presently is pending to
assign the license of this station to parties unaffiliated with Xx.
Xxxxx.
WEZF-FM, Burlington, VT -- A temporary waiver of the one-to-a-market
rule will be requested for the brief period of time that STC License
Company may control WNNE-TV and WPTZ-TV.
With respect to WNAC-TV, Xx. Xxxxx and certain of his associates have
attributable interest in three radio stations serving Providence, RI; however,
the proposed assignee of the license for WNAC-TV (Xxxxx Acquisition License
Company) and its attributable parties do not have attributable interest in any
media in the Providence, RI area.
Mount Mansfield Television, Inc., the license of WCAX-TV, Burlington,
VT, has filed various petitions and objections with the FCC relating to the
overlap of Grade B signals between WNNE-TV and WPTZ-TV and the affiliated LMA
with WFFF-TV. See, e.g., Memorandum Opinion and Order, FCC-98-6 (January 23,
1998). It is possible WCAX-TV will oppose the acquisition and/or sale of WNNE-TV
and WPTZ-TV by STC License Company. While the FCC has granted a permanent waiver
of Section 73.3555(b) with respect to the overlap of WNNE-TV's and WPTZ-TV's
Grade B contours, this is not yet a final order, and a continuation of this
waiver will be necessary to complete the acquisition by HAT.
37
SCHEDULE 3.10
PROPERTY DOCUMENTS DELIVERED
Survey of Properties
--------------------
Studio on Xxxx Street, Salinas, CA
Summit Road
Fremont Peak
Grant Deeds
-----------
Studio on Xxxx Street, Salinas, CA
Summit Road - Transmitter
Fremont Peak
Title Policy
------------
Studio on Xxxx Street, Salinas, CA
Summit Road - Transmitter
Fremont Peak
38
SCHEDULE 3.10
ENCUMBRANCES ON REAL PROPERTY AND LEASEHOLD INTEREST
Studio Site and Fremont Peak
----------------------------
1. The lien of supplemental taxes, if any, assessed pursuant to Chapter 498
Statutes of 1983, of the State of California, arising by reason of a change in
ownership or the completion of new construction; a lien not yet due and payable.
2. Assessment For Water usage by the Monterey Regional Water Pollution Control
Agency; a lien not yet due and payable. Affects Parcel I.
3. A non-exclusive easement for the purpose shown below and rights incidental
thereto as set forth in a document
Granted To: The Pacific Telephone and Telegraph Company
Purpose: Electric Utility Line
Recorded: 6/14/49 in Volume 1144 of Official Records, at Page 421
4. The fact that said land is included within a project area of the
Redevelopment Agency shown below, and that proceedings for the Redevelopment of
said project have been instituted under the Redevelopment Law (such
redevelopment to proceed only after the adoption of the Redevelopment Plan) as
disclosed by a document.
Agency: Salinas Urban Renewal Agency, City of Xxxxxxx
Recorded: 7/26/74 in Reel 926 of Official Records at Page 695
Affects: Parcel I
Amended Redevelopment Plan
Recorded: January 28, 1995 in Reel 3193 of Official Records, at Page 584
5. A non-exclusive easement for the purpose shown below and rights incidental
thereto as set forth in a document.
Granted To: Pacific Gas and Electric Company and the Pacific Telephone and
Telegraph Company
Purpose: Electric Utility Facilities
Recorded: 6/15/81 in Reel 1487 of Official Records, at Page 782
Affects: Portions of Parcel II
6. A non-exclusive easement for the purpose shown below and rights incidental
thereto as set forth in a final Order of Condemnation and as shown on that
certain survey made by Monterey County Surveyors, Inc. dated 11/28/1995, Job
#18342 and last revised 1/10/1996.
39
Granted To: Pacific Gas and Electric Company
Purpose: Electric Transmission Line
Recorded: 7/6/50 in Volume 1228 of Official Records, at Page 523 and
1/27/58 in Reel 1844 of Official Records at Page 324.
Affects: A Portion of Parcel II
7. A non-exclusive easement for the purpose shown below and rights incidental
thereto as set forth in a document and as shown on that certain survey made by
Monterey County Surveyors, Inc. dated 11/28/96, Job #18324 and last revised
1/10/96.
Granted To: Pacific Xxxx
Purpose: Underground Telecommunications Facilities
Recorded: 7/29/85 in Reel 1862 of Official Records, at Page 266
Affects: The Southwesterly 6 feet of the Southeasterly 34 feet of
Parcel II
8. Any rights, interests, or claims which may exist or arise by reason of the
following facts shown on a survey plat made for Xxxxx Television of
Salinas-Monterey, L.P., dated 11/28/95, Job #18324 and last revised 1/10/96,
prepared by Monterey County Surveyors, Inc.:
(A) The fact that a KSBW sign encroaches along a portion of the Westerly
boundary over the public way.
(B) The fact that the metal facade of the studio building encroaches over the
lot line on the Northwest corner of the studio site and over a portion of the
Northerly boundary of the lot running along Xxxx Street onto the public way.
AS TO PARCEL II:
(A) The fact that overhead electric lines encroach over portions of the
Northeasterly and Southerly boundary lines of said lot.
(B) The fact that guy with 8' high C/L fence encroaches along the Southerly
boundary partially on said land and partially on said adjoining land.
(C) The fact that a steel T.V. tower with a 8' high C/L fence encroaches in the
Southwesterly boundary.
(D) The fact that an 8' high C/L fence encroaches along the Southwesterly
boundary partially on said land and partially on adjoining land.
(E) The fact that a guy encroaches along a portion of the Southerly boundary.
40
9. Covenants and conditions contained in Permit Approval Notice
Executed by: KSBW, Inc.
And Between: Monterey County
Recorded: 5/25/93 in Reel 2947 of Official Records, at Page 1018
Affects: Parcel II
and as Amended by an Indemnification Agreement recorded October 4, 1993, in Reel
3004 of Official Records at Page 812.
10. Rights of tenant as tenant only under an unrecorded lease with certain
terms, covenants, conditions and provisions set forth therein.
Lessor: KSBW, Inc.
Lessee: Nextel of California
Disclosed By: Memorandum of Lease
Recorded: 1/4/94 in Reel 3048 of Official Records, at Page 1017
Affects: a portion of Parcel II
The present ownership of the leasehold created by the above Lease and other
matter affecting the interest of the Lessee are not shown herein.
11. Right of access to Parcel II. Access to the land is possible solely
pursuant to the terms, conditions, and limitations of a Permit for Right of Way
from the State of California acting through the Department of Parks and
Recreation and E.P. Communications, Inc. dated November 15, 1994.
12. Defects, liens, encumbrances, adverse claims affecting the road that is the
subject of the Permit for the Right of Way from the State of California acting
through the Department of Parks and Recreation and E.P.
Communications, Inc. dated November 15, 1994.
13. See Schedule 2.1.8, Section 3, Lease Agreements Where Station is Lessor.
Transmitter Site - Summit Road
------------------------------
As to property within Santa Xxxx County (Parcel Four):
------------------------------------------------------
14. The lien of supplemental taxes, if any, assessed pursuant to the provisions
of Section 75, et. seq. of the Revenue and Taxation Code of the State of
California, arising by reason of a change in ownership or the completion of new
construction; a lien not yet due and payable.
15. The right of the public to use as a roadway so much of the herein described
premises lying within the bounds of Summit Road (Mt. Xxxxxxx Road).
41
As to property within Santa Xxxxx County (Parcels One, Two and Three):
----------------------------------------------------------------------
16. The lien of supplemental taxes, if any, assessed pursuant to the provisions
of Section 75, et. seq. of the Revenue and Taxation Code of the State of
California, arising by reason of a change in ownership or the completion of new
construction; a lien not yet due and payable.
17. An easement for the purpose shown below and rights incidental thereto as set
forth in document:
Granted To: County of Santa Xxxxx, et al
Purpose: public street and road purposes and utilities
Recorded: April 18, 1984 in Book I 470 page 364, Official Records
Affects: portions of said land lying within Mt. Xxxxxxx Road (Summit
Road)
and as shown on Survey made by Xxxxxx and Xxxxx, Inc., dated 12/86; 5/94 and
10/31/95, and last revised 1/18/96 (Job #86218 & 94022).
18. An easement for the purpose shown below and rights incidental thereto as set
forth in the document:
Granted To: Pacific Gas and Electric Company, a California
Purpose: corporation construct, install, inspect, maintain,
Recorded: replace, remove and use facilities
Affects: July 5, 1984 in Book I 695 page 354, Official Records as second
party deems necessary located within the portion of Summit Road
as shown upon the Record of Survey Map filed for record in Book
495 of Maps at Page 11, Santa Xxxxx County Records, lying
within said lands.
and as shown on Survey made by Xxxxxx and Xxxxx, Inc., dated 12/86; 5/94 and
10/31/95, and last revised 1/18/96 (Job #86218 & 94022).
19. See Schedule 2.1.8, Section 3, Lease Agreements Where Station is Lessor.
General
-------
20. Real estate taxes not yet due and payable or the validity of which is being
contested in good faith.
21. Laws and governmental regulations that affect the use and maintenance of
such real property.
22. Mechanics', carriers', workers', repairmens', and other similar liens not
more than ninety (90) days old arising or incurred in the ordinary course of
business. There has been no work done within the past ninety (90) days that
would arise in any such liens.
23. Rights or claims of parties in possession not shown by the public records as
parties in possession as tenant only.
42
SCHEDULE 3.14
EMPLOYEE BENEFIT PLANS
STC Broadcasting, Inc. is a participating affiliate in the following
Sunrise Television Corp. Benefit Plans.
1. Sunrise Television Corp. Employee Benefit Trust.
Covering the following:
. Life Insurance
. Accidental Death, Dismemberment + Loss of Sight Insurance
. Hospital
. Medical Benefits Dental Care Benefits
. Prescription and Mail Order Drug Benefit
. Vision
. Flexible Benefit Account - Dependent Premium only.
. Long term care *, **
Determination letter sought, received and valid on tax exempt status
of Trust.
STC Broadcasting, Inc. will owe the following for each employee and
separate dependent unit withdrawn from the Sunrise Health Plan, which will be
satisfied on or before the closing:
Employee $ 405.55
==========
Dependent Coverage
Additional Amount $ 1,086.23
==========
These payments are to cover incurred but unreported claims as of
closing.
2. Sunrise Television Corp. + Affiliates 401(k) Plan ***,****
3. Sunrise Television Corp. + Affiliates Long and Short-Term Disability Plan
*,**
4. Sunrise Television Corp. + Affiliates Travel - Accident Insurance Plan *, **
* No determination letter sought on plan.
** Completely funded by purchase of insurance contracts.
*** Prototype plan of Dun & Bradstreet. Dun & Bradstreet
has received favorable determination letter on
prototype plan. Sunrise Television Corp has requested
and received a favorable determination letter from
the IRS.
43
**** The matching contribution component of the 401(k)
Plan for employees is presently 100% on the first 3%
of salary contributed. An additional discretionary
matching contribution is possible.
Participation in each of the foregoing plans will terminate
at closing.
5. Additional Items
a. See Seller's Employee Handbooks which are incorporated herein by
reference.
b. See Schedule 2.3.9 regarding employment agreements which may
provide for additional benefits.
6. Cost of Benefit Programs
. Health, Life and Dental
. $210 for employee
. $465 for family
. Life Insurance
. $.23 per $1,000 for Life
. $.04 per $1,000 for AD & D
. Disability
. $.32 per $100 of covered compensation
. $.29 per $100 of covered compensation
. Long Term Care
. See schedule attached
44
--------------------------------------------------------------------------------
[LOGO OF UNUM RATE SHEET
LONG TERM CARE
APPEARS HERE] SUNRISE TELEVISION CORPORATION
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
BASE PLAN
---------
Facility Monthly Benefit $2,000
House Monthly Benefit $1,000
Facility Benefit Duration 3 Years
House Benefit 50%
Lifetime Maximum $72,000
Elimination Period 90 DAY
Home Care Level TOTAL
--------------------------------------------------------------------------------
This rate sheet shows the cost per $2,000 of coverage
--------------------------------------------------------------------------------
Your insurance age: Your age as of the effective date of coverage.
--------------------------------------------------------------------------------
Select age, plan and transfer premium cost to your Benefit Election Form.
--------------------------------------------------------------------------------
Monthly Rates
--------------------------------------------------------------------------------
AGE BASE PLAN AGE BASE PLAN
--------------------------------------------------------------------------------
18-30 7.00 60 38.20
31 7.40 61 41.20
32 7.60 62 44.60
33 7.80 63 48.20
34 8.20 64 52.00
35 8.60 65 58.00
36 9.00 66 62.60
37 9.40 67 67.80
38 9.80 68 73.60
39 10.40 69 79.60
40 11.00 70 86.40
41 11.40 71 97.60
42 12.00 72 109.00
43 12.80 73 120.40
44 13.40 74 131.80
45 14.20 75 143.20
46 15.00 76 155.50
47 16.00 77 169.60
48 17.00 78 185.20
49 17.80 79 201.60
50 19.00 80 219.40
51 20.20 81 230.00
52 21.60 82 260.00
53 22.80 83 283.80
54 24.40 84 307.80
55 25.80
56 28.00
57 30.40
58 32.60
59 35.40
RUN DATE: 07/01/97 Employer Funded: MUBUYUP
--------------------------------------------------------------------------------
SCHEDULE 3.15
LABOR RELATIONS
. See attached list of employees as of December 31, 1997.
. See schedule 3.14 for details on benefits and employee personnel policies
. See Schedule 2.3.9 for employee personal service contracts.
. There are no collective bargaining agreements at KSBW-TV.
. See Schedule 3.7 for potential claim on overtime by former employee.
. If not offered employment by Hearst Argyle Stations, Inc. at closing,
STC Broadcasting, Inc. has agreed with Xxxxxx Xxxx, general manager of
KSBW-TV, that they will pay him one year severance.
45
All Current KSBW Employees by Dept.
-----------------------------------
------------------------------------------------------------------------------------------------------------------------------
Last Name First Name Xxx. Salary Job Title Ee Status
------------------------------------------------------------------------------------------------------------------------------
==============================================================================================================================
Engineering: Fulltime: 13, Openings: 0
------------ -------------------------
==============================================================================================================================
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxx $37,500 Master Control Supervisor Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $40,000 TV Maintenance Engineer Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxx $26,392 Master Control Operator Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Garden Xxxxx $34,049 TV Maintenance Engineer Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxxxx $29,282 Master Control Operator Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxx $62,500 Chief Engineer Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxxx Xxx $35,218 Master Control Operator Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxx $35,219 Master Control Operator Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxx $19,760 Master Control Operator Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $21,367 Building Maintenance Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxxx $31,357 Master Control Operator Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxx Xxx $19,760 Master Control Operator Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxx Xxxxxx $35,360 TV Maintenance Engineer Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Totals: $427,764
------------------------------------------------------------------------------------------------------------------------------
==============================================================================================================================
Programming: Fulltime: 1, Openings: 0
------------ ------------------------
==============================================================================================================================
------------------------------------------------------------------------------------------------------------------------------
AlkassAdeh Helbard $22,000 Programming Coordinator Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Totals: $22,000
------------------------------------------------------------------------------------------------------------------------------
==============================================================================================================================
News: Fulltime: 36, Openings: 1 Parttime: 2, Openings: 0
----- ------------------------- ------------------------
==============================================================================================================================
OPEN POSITION Reporter Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxx $23,920 Photographer Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxx $17,944 New Operation Coordinator Fulltime/30+hours
------------------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $33,000 Assignment Editor Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxxxx $21,632 Photographer Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxx Xxxxx $22,495 Photographer Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxx Xxxxxxx $30,800 5 pm Anchor Fulltime/Contract
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxxxx Xxxx $27,000 Sunrise/Midday Anchor Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $70,035 News Director Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxx $26,500 Reporter Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxx $13,260 Associate Producer Fulltime/30+hours
------------------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxxx $25,750 Weekend & Fill-in Sports Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxx $22,048 Photographer Fulltime/Perm
------------------------------------------------------------------------------------------------------------------------------
Page 1
All Current KSBW Employees by Dept.
-----------------------------------
---------------------------------------------------------------------------------------------------
Xxxxx Xxxx $28,000 Santa Xxxx Bureau Reporter Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxx Xxx $85,000 5, 6, 11pm Anchor Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxx $38,000 Executive Producer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxxx Xxx $23,150 Photographer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxx Xxxxxx $21,632 Photographer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxxx Xxx $24,500 Reporter Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxxxxx $31,500 11 pm Anchor Fulltime/Contract
---------------------------------------------------------------------------------------------------
Xxx Xxx $25,500 11 pm Producer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxx $50,250 Primary Sports Anchor Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $32,500 Weekend Anchor Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxx Xxxxx $30,000 Sunrise/Midday WX Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $28,208 Photographer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $7,600 Weekend Weather Anchor Parttime/Perm
---------------------------------------------------------------------------------------------------
Panalloni Charlotte $18,720 Associate Producer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxx Xxx $27,500 Ag/Sunrise/Midday Anchor Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxx Xxxxx $27,000 6 pm Producer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxxx Xxxxx $30,000 Weekend Anchor Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxxxxx Xxxx $24,500 Sunrise Producer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxx Xxxx $27,000 Associate Producer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $16,380 Fill-In Sports Anchor Fulltime/30+hrs
---------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $21,736 Photographer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxxx Xxx $22,880 Photographer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Van Xxxx Xxxxx $7,600 Weekend Weather Anchor Parttime/Perm
---------------------------------------------------------------------------------------------------
Vanderzwaan Xxx $76,000 Primary WX Anchor Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxx-Xxxxx Xxxxxxx $28,000 5 pm Producer Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxx Xxxxxxx $27,000 Gilroy Bureau Reporter Fulltime/Perm
---------------------------------------------------------------------------------------------------
Totals: $1,112,540
---------------------------------------------------------------------------------------------------
===================================================================================================
Operations: Fulltime: 18, Openings:0 Parttime: 5, Openings: 1
===================================================================================================
---------------------------------------------------------------------------------------------------
OPEN POSITION Operations Assistant *Parttime/Temp
---------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxx $20,800 Operations Coordinator Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxx Xxx $45,000 MIS & Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxxxx Xxxxx $40,000 Operations Manager Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxx $30,000 Graphic Artist Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxxxxxxx Xxx $39,400 Creative Services Producer/Dir Fulltime/Perm
---------------------------------------------------------------------------------------------------
XxXxxxxx Xxx $15,600 Operations Assistant Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxx Xxxx $15,600 Operations Assistant Fulltime/Perm
---------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $29,994 Creative Services Producer/Dir Fulltime/Perm
---------------------------------------------------------------------------------------------------
Page 2
All Current KSBW Employees by Dept.
-----------------------------------
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxxx Xxx $15,600 Operations Assistant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxx $8,970 Operations Assistant *Parttime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxxx $5,850 Operations Assistant *Parttime/Temp
-------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxx $27,583 Newscast Director Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
XxXxxxx Xxxxxx $21,840 Newscast Director Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxx Xxxxx $15,600 Operations Assistant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Morphy Oshen $2,080 Operations Videographer Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxx-Xxxxxxxx Xxxxxx $29,120 Assistant Operations Manager Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxxx $19,760 Operations Assistant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxx $11,700 Operations Assistant *Parttime/Temp
-------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxx $21,840 Newcast Director Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxx $15,600 Operations Assistant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $7,800 Operations Assistant *Partime/Temp
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxx Jet $21,840 Newscast Director Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxx $9,750 Operations Assistant *Parttime/Temp
-------------------------------------------------------------------------------------------------------------------
Totals: $471,327
-------------------------------------------------------------------------------------------------------------------
===================================================================================================================
Sales: Fulltime: 11 Openings: 1
------ --------------------------
===================================================================================================================
-------------------------------------------------------------------------------------------------------------------
OPEN POSITION **(Will Be Commission Only) Media Consultant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxx (2) $36,397 Sales Promotion Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxxx (1) $35,557 Media Consultant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxx (2) $100,837 Sales Manager Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxx (2) $77,162 National Sales Manager Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxx $20,800 Sales Assistant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxx (Balertrieri) Xxxxxxxxx (1) $56,182 Media Consultant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxx (1) $42,463 Media Consultant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxx (2) $83,696 Regional Sales Manager Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxx Xxxxx (1) $64,484 Media Consultant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxxx Xxxxxxx (1) $67,480 Media Consultant Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxx (2) $34,127 Sales Events Fulltime/Perm
-------------------------------------------------------------------------------------------------------------------
Totals: $619,185
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
(1): Paid By Commission, Used 1998 Budget
-------------------------------------------------------------------------------------------------------------------
(2): Includes Salary plus 1998 Budgeted Commissions.
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
===================================================================================================================
Traffic: Fulltime: 3 Openings: 0
-------- ------------ ------------
-------------------------------------------------------------------------------------------------------------------
Page 3
All Current KSBW Employees by Dept.
-----------------------------------
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
L'Xxxxxxxxx Xxxxxx $27,429 Traffic Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Xxxxxxxxxxx Xxx $41,862 Traffic Manager Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxx $22,187 Traffic Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Totals: $91,478
--------------------------------------------------------------------------------------------------------------
==============================================================================================================
Promotions: Fulltime: 1 Openings: 0
==============================================================================================================
--------------------------------------------------------------------------------------------------------------
Xxxxxxxxx Xxxxxxx $29,000 Promotions Producer Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Totals: $29,000
--------------------------------------------------------------------------------------------------------------
==============================================================================================================
General & Administrative: Fulltime: 7 Openings: 0
==============================================================================================================
--------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxx $19,282 Receptionist Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxxxx $26,000 Human Resources & Executive Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Xxxxxx-Xxxx Xxxxx $31,929 Accounts Payable & Payroll Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxx $26,500 Accounts Receivables Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxx $62,000 Business Manager Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Xxxx Xxx $176,402 General Manager Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxxx $30,900 Community Relations Director Fulltime/Perm
--------------------------------------------------------------------------------------------------------------
Totals: $373,013
--------------------------------------------------------------------------------------------------------------
Page 4
SCHEDULE 3.16
ENVIRONMENTAL MATTERS
1. Phase I Environmental Site Assessment and Limited Soil Survey dated
March 8,1994 is incorporated herein by reference.
2. Letter from Environmental Strategies Corporation ("ESC") dated August 4,
1995 is incorporated herein by reference.
3. Letter from PHR Environmental Consultants ("PHR") dated September 19, 1995
is incorporated herein by reference.
4. Letter from "PHR" dated October 9, 1995 is incorporated herein by reference.
5. Letter from "ESC" dated October 17, 1995 is incorporated herein by
reference.
6. Letter from "PHR" dated October 30, 1995 is incorporated herein by
reference.
7. Report dated November 20, 1995 from "PHR" is incorporated herein by
reference.
8. Letter from "PHR" dated December 22, 1995 is incorporated herein by
reference.
9. Letter from "PHR" dated January 10, 1996 is incorporated herein by
reference.
10. Letter from "PHR" dated January 18, 1996 is incorporated herein by
reference.
11. Letter from "ESC" dated January 24, 1996 is incorporated herein by
reference.
12. KSBW Business Response Plan dated April 15, 1996 is incorporated herein by
reference.
13. Letter from ESC dated January 21,1998
46
SCHEDULE 3.17
INSURANCE POLICIES
See attached Summary of Coverage.
STC Broadcasting, Inc. has elected to participate in the
Hicks, Muse, Xxxx & Xxxxx insurance program. Coverage for the Station under all
such policies will terminate as of Closing.
47
[SUNRISE TELEVISION CORP. LOGO APPEARS HERE]
STC Broadcasting, Inc.
VI.
Schedule of Insurance
and Aon Service Team
= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =
STC BROADCASTING, INC.
SCHEDULE OF INSURANCE
---------------------
As of April 1, 1997
====================================================================================================================================
------------------------------------------------------------------------------------------------------------------------------------
COVERAGE CARRIER XXX NUMBER EFFECTIVE DATES LIMITS
------------------------------------------------------------------------------------------------------------------------------------
Aircraft Liability St. Xxxx (USAIG) 360AC279269 4/01/97 - 4/01/98 $ 30,000,000 Combined Single Limit
(Non-Owned)
Auto Liability/Physical Federal Insurance Co 73212846 4/01/97 - 4/01/98 $ 1,000,000 CSL
Damage $ 500 Comprehensive Deductible
$ 500 Collision Deductible
$ 50,000 Hired Car Physical Damage
$ 500 Hired Car Physical Damage
Comprehensive Ded
$ 500 Hired Car Physical Damage
Collision Ded
Boiler & Machinery Hartford Steam Boiler BMINY621326501 4/01/97 - 4/01/98 $ 100,000,000 Combined PD/BI/EE/Utility
Interruption
$ 5,000,000 Ammonia Contamination
$ 5,000,000 Water Damage
$ 5,000,000 Consequential Damage
$ 5,000,000 Expediting Expense
$ 500,000 Hazardous Substance
$ 5,000 Deductible; except
-----------
12 Hours Utility Interruption
24 Hours BI/EE
Broadcasters E&O Employers Reins. Corp. BR11030 2/28/97 - 2/28/98 $ 5,000,000 Each Occurrence
Crime Federal Insurance Co. 81477513 2/28/97 - 7/01/98 $ 1,000,000 Employee Theft
$ 100,000 Depositor's Theft
$ 1,000 Deductible
STC BROADCASTING, INC.
SCHEDULE OF INSURANCE
---------------------
As of April 1, 1997
------------------------------------------------------------------------------------------------------------------------------------
COVERAGE CARRIER POLICY NUMBER EFFECTIVE DATES LIMITS
------------------------------------------------------------------------------------------------------------------------------------
Directors & Officers National Union Fire 4835299 2/28/97 - 07/01/99 $ 10,000,000 Limit of Liability
Liability Insurance Company $ 100,000 Corporate Retention
Employment Practices A.I. Surplus Lines 8192085 2/28/97 - 12/31/99 $ 10,000,000 Limit of Liability
Liability $ 100,000 Corporate Retention
Fiduciary Liability Federal Insurance Co. 81477513 2/28/97 - 7/01/98 $ 10,000,000 Limit of Liability
General Liability Federal Insurance Co. 35352734 4/01/97 - 4/01/98 $ 2,000,000 General Aggregate
$ 1,000,000 Products/Completed Operations
Aggregate
$ 1,000,000 Personal & Advertising Injury
$ 1,000,000 Per Occurrence
$ 1,000,000 Fire Damage
$ 10,000 Medical
Property Lexington Insurance Co. 8793049 4/01/97 - 4/01/98 $ 400,000,000 "All Risk" Including Business
Interruption
(Primary $5,000,000) Loss Limit Per Occurrence
Sublimits Are Per Occurrence unless
Otherwise Stated
$ 400,000,000 Earthquake - Annual Aggregate
(Outside CA)
$ 100,000,000 Earthquake - Annual Aggregate (CA)
$ 400,000,000 Flood - Annual Aggregate
$ 5,000 Deductible Except:
------
$ 5,000 Transit
$ 50,000 Flood
5% Earthquake - Per Unit of Insurance
$ 100,000 Earthquake Minimum - CA Only
$ 50,000 Earthquake Minimum - All Other
States
2% Wind - Tier 1 Locations
$ 100,000 Wind - Minimum
STC BROADCASTING, INC.
SCHEDULE OF INSURANCE
---------------------
As of April 1, 1997
====================================================================================================================================
------------------------------------------------------------------------------------------------------------------------------------
COVERAGE CARRIER POLICY NUMBER EFFECTIVE DATES LIMITS
------------------------------------------------------------------------------------------------------------------------------------
Umbrella Westchester Fire Ins. Co. CUA1036790 4/01/97 - 4/01/98 $ 20,000,000 Per Occurrence
$ 20,000,000 Aggregate
$ 10,000 Self-Insured Retention
Excess Liability TIG Insurance Co. XLX9262707 4/01/97 - 4/01/98 $ 25,000,000 Per Occurrence Excess of
$20,000,000
$ 25,000,000 Aggregate
Excess Liability Federal Insurance Co. 79402066 4/01/97 - 4/01/98 $ 30,000,000 Per Occurrence Excess of
$45,000,000
$ 30,000,000 Aggregate
Excess Liability Travelers Indemnity Co. 0XXXXXX000X000000 4/01/97 - 4/01/98 $ 25,000,000 Per Occurrence Excess of
$75,000,000
$ 25,000,000 Aggregate
Workers' Compensation Federal Insurance Co. 71631919 4/01/97 - 4/01/98 Statutory (Work Comp)
Employers' Liability:
$ 1,000,000 Each Accident
$ 1,000,000 Disease-Policy Limit
$ 1,000,000 Disease-Each Employee
SCHEDULE 3.19
AFFILIATED TRANSACTIONS
See Schedule 2.4.16 for details
48
SCHEDULE 12.2
BROKER
Hearst-Argyle Stations, Inc. and STC Broadcasting, Inc have agreed to pay
Chase Manhattan Bank a broker fee of $1.1 million. Each party agrees to pay 50%
of this amount upon the final closing of the Asset Exchange Agreement.
49
