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Exhibit 10.18
AMENDED AND RESTATED LOAN AGREEMENT
AMONG
CITADEL BROADCASTING COMPANY AND
CITADEL LICENSE, INC.
AND
LENDERS
DATED JULY 3, 1997
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TABLE OF CONTENTS
Page No.
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PRELIMINARY STATEMENT.................................................................................. 1
ARTICLE I.............................................................................................. 1
DEFINITIONS AND DETERMINATIONS......................................................................... 1
1.1 Definitions.......................................................................... 1
1.2 Time Periods......................................................................... 28
1.3 Accounting Terms and Determinations.................................................. 28
1.4 References........................................................................... 29
1.5 Borrowers' Knowledge................................................................. 29
1.6 Benefit of Lenders................................................................... 29
ARTICLE II............................................................................................. 29
LOANS AND TERMS OF PAYMENT............................................................................. 29
2.1 Existing Loans; Outstanding L/C Guaranty Obligations................................. 29
2.2 Additional Loans; Issuance of L/C Guaranties......................................... 29
2.2.1 Obligation of Lenders....................................................... 29
2.2.2 Obligations of Borrowers.................................................... 30
2.3 Conditions to Additional Loans; L/C Guaranties....................................... 30
2.4 Procedures for Additional Loans and Issuance of L/C Guaranties....................... 31
2.4.1 Making Additional Loans Other Than in Connection With L/C
Guaranties.................................................................. 31
2.4.2 L/C Guaranties.............................................................. 31
2.4.3 Additional Loans in Connection with L/C Guaranties.......................... 31
2.5 Interest; Default Rate, Late Charges, Loan Fees and Agent's Fees............ 32
2.5.1 Interest.................................................................... 32
2.5.2 Late Charges................................................................ 33
2.5.3 Amendment Fee............................................................... 33
2.5.4 Agent's Fee................................................................. 33
2.5.5 Unused Commitment Fee....................................................... 33
2.5.6 Letter of Credit Fees....................................................... 34
2.5.7 Computation of Interest, Unused Commitment Fees and Letter of
Credit Fees................................................................. 34
2.6 LIBOR Loans.......................................................................... 34
2.6.1 Election by Borrowers....................................................... 34
2.6.2 LIBOR Limitations........................................................... 35
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2.6.3 Eurodollar Deposits Unavailable or Interest Rate
Unascertainable............................................................. 35
2.6.4 Tax and Other Laws.......................................................... 35
2.6.5 Changes in Law Rendering LIBOR Loans Unlawful............................... 35
2.6.6 Indemnity................................................................... 36
2.6.7 Option to Replace Affected Lender........................................... 36
2.7 Reductions of Commitments, Principal Payments............................... 36
2.7.1 Mandatory Reductions of Commitments and Principal Payments.................. 36
2.7.2 Other Mandatory Reductions of Commitments; Prepayments of the
Loans....................................................................... 36
2.8 Voluntary Reductions in Commitments and Prepayments; Prepayment
Premiums............................................................................. 37
2.8.1 Voluntary Reduction of Commitments.......................................... 37
2.8.2 Voluntary Prepayments....................................................... 37
2.8.3 Premiums.................................................................... 38
2.9 Payment at Maturity.................................................................. 38
2.10 Letter of Credit Fund................................................................ 38
2.11 Payments after Event of Default...................................................... 38
2.12 Method and Distribution of Payments.................................................. 38
2.12.1 Method of Payment; Good Funds............................................... 38
2.12.2 Distribution of Payments.................................................... 38
2.12.3 Distributions by Agent to Lenders........................................... 39
ARTICLE III............................................................................................ 39
SECURITY; GUARANTY..................................................................................... 39
3.1 Security............................................................................. 39
3.2 Guaranty............................................................................. 39
ARTICLE IV............................................................................................. 39
CONDITIONS OF CLOSINGS; ACQUISITIONS; TELE-MEDIA MERGER................................................ 39
4.1 Closing.............................................................................. 39
4.1.1 Representations and Warranties.............................................. 39
4.1.2 Consummation of Mergers; Tele-Media Acquisition............................. 39
4.1.3 Delivery of Documents....................................................... 40
4.1.4 Performance; No Default..................................................... 41
4.1.5 Opinions of Counsel......................................................... 41
4.1.6 Approval of Instruments and Security Interests.............................. 41
4.1.7 Security Interests.......................................................... 42
4.1.8 FCC Licenses................................................................ 42
4.1.9 LMA Agreements.............................................................. 42
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4.1.10 Financial Statements, Reports and Projections............................... 42
4.1.11 Material Adverse Change..................................................... 42
4.1.12 Use of Assets............................................................... 42
4.1.13 Broker Fees................................................................. 42
4.1.14 Insurance................................................................... 43
4.1.15 Payment of Amendment Fee and Other Fees..................................... 43
4.2 Tele-Media Merger.................................................................... 43
4.2.1 Consummation of Tele-Media Merger........................................... 43
4.2.2 Delivery of Documents....................................................... 43
4.2.3 Opinions of Counsel......................................................... 44
4.2.4 Security Interests.......................................................... 44
4.2.5 Insurance................................................................... 44
4.3. Acquisitions......................................................................... 44
4.3.1 Consummation of Acquisitions................................................ 44
4.3.2 Delivery of Documents....................................................... 45
4.3.3 Financial Statements, Reports and Projections............................... 45
4.3.4 Compliance with Applicable Ratio............................................ 45
4.3.5 Opinions of Counsel......................................................... 45
4.3.6 FCC Licenses................................................................ 45
4.3.7 Security Interest........................................................... 46
4.3.8 Environmental Audit......................................................... 46
4.3.9 Insurance; Survey........................................................... 46
4.3.10 Engineer's Certificate...................................................... 46
4.3.11 Payment of Fees............................................................. 46
4.3.12 Representations and Warranties.............................................. 46
4.3.13 Performance; No Default..................................................... 46
4.4 Landlord's Consent................................................................... 47
ARTICLE V.............................................................................................. 47
REPRESENTATIONS AND WARRANTIES......................................................................... 47
5.1 Corporate Existence and Power........................................................ 47
5.2 Corporate Authority.................................................................. 47
5.3 Capital Stock, Senior Subordinated Notes and Related Matters......................... 47
5.3.1 Capitalization of Borrowers................................................. 47
5.3.2 Restrictions................................................................ 47
5.4 Binding Agreements................................................................... 48
5.5 Business, Property and Licenses of Borrower.......................................... 48
5.5.1 Business and Property....................................................... 48
5.5.2 FCC Licenses................................................................ 48
5.5.3 LMA Agreements.............................................................. 48
5.5.4 Operating Agreements........................................................ 48
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5.5.5 Business Locations.......................................................... 49
5.5.6 Real Property; Leases....................................................... 49
5.5.7 Operation and Maintenance of Equipment...................................... 49
5.6 Title to Property; Liens............................................................. 49
5.7 Projections and Financial Statements................................................. 49
5.7.1 Financial Statements........................................................ 49
5.7.2 Projections................................................................. 50
5.8 Litigation........................................................................... 50
5.9 Defaults in Other Agreements; Consents; Conflicting Agreements....................... 50
5.10 Taxes................................................................................ 51
5.11 Compliance with Applicable Laws...................................................... 51
5.12 Patents, Trademarks and Franchises................................................... 51
5.13 FCC Matters.......................................................................... 51
5.14 Environmental Matters................................................................ 52
5.15 Application of Certain Laws and Regulations.......................................... 52
5.15.1 Investment Company Act...................................................... 52
5.15.2 Holding Company Act......................................................... 52
5.15.3 Foreign or Enemy Status..................................................... 52
5.15.4 Regulations as to Borrowing................................................. 52
5.16 Margin Regulations................................................................... 52
5.17 Other Indebtedness................................................................... 53
5.18 No Misrepresentation................................................................. 53
5.19 Employee Benefit Plans............................................................... 53
5.19.1 No Other Plans.............................................................. 53
5.19.2 ERISA and Code Compliance and Liability..................................... 53
5.19.3 Funding..................................................................... 53
5.19.4 Prohibited Transactions and Payments........................................ 54
5.19.5 No Termination Event........................................................ 54
5.19.6 ERISA Litigation............................................................ 54
5.20 Employee Matters..................................................................... 54
5.20.1 Collective Bargaining Agreements; Grievances................................ 54
5.20.2 Claims Relating to Employment............................................... 54
5.21 Burdensome Obligations............................................................... 54
5.22 Insurance............................................................................ 55
5.23 Representation as to Acquisition Instruments......................................... 55
ARTICLE VI............................................................................................. 55
AFFIRMATIVE COVENANTS.................................................................................. 55
6.1 Legal Existence; Good Standing....................................................... 55
6.2 Inspection........................................................................... 55
6.3 Financial Statements and Other Information........................................... 56
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6.3.1 Monthly Statements.......................................................... 56
6.3.2 Quarterly Statements........................................................ 56
6.3.3 Annual Statements........................................................... 57
6.3.4 Officer's Certificates...................................................... 57
6.3.5 Accountants' Certificate.................................................... 58
6.3.6 Audit Reports............................................................... 58
6.3.7 Business Plans.............................................................. 58
6.3.8 Notice of Defaults; Loss.................................................... 58
6.3.9 Notice of Suits, Adverse Events............................................. 58
6.3.10 Reports to Shareholders, Creditors and Governmental
Bodies...................................................................... 59
6.3.11 ERISA Notices and Requests.................................................. 59
6.3.12 Rating Books................................................................ 60
6.3.13 Other Information........................................................... 60
6.4 Reports to Governmental Bodies and Other Persons..................................... 60
6.5 Maintenance of Licenses and Other Agreements......................................... 61
6.6 Insurance............................................................................ 61
6.6.1 Key Man Life Insurance...................................................... 61
6.6.2 Business Insurance.......................................................... 61
6.6.3 Business Insurance, Claims and Proceeds..................................... 61
6.6.4 Flood Insurance............................................................. 62
6.7 Future Leases........................................................................ 62
6.8 Future Acquisitions of Real Property................................................. 62
6.9 Environmental Audit.................................................................. 62
6.10 Environmental Matters................................................................ 62
6.10.1 Compliance.................................................................. 62
6.10.2 Certification............................................................... 63
6.11 Interest Hedge Contract.............................................................. 63
6.12 Compliance with Laws................................................................. 63
6.13 Taxes and Claims..................................................................... 63
6.14 Maintenance of Properties............................................................ 63
ARTICLE VII............................................................................................ 63
NEGATIVE COVENANTS..................................................................................... 63
7.1 Borrowing............................................................................ 64
7.2 Liens................................................................................ 64
7.3 Merger and Acquisition............................................................... 64
7.4 Contingent Liabilities............................................................... 64
7.5 Distributions........................................................................ 64
7.6 Limitation of Corporate Overhead and Capital Expenditures............................ 64
7.6.1 Corporate Overhead.......................................................... 64
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7.6.2 Capital Expenditures........................................................ 65
7.7 Payments of Indebtedness for Borrowed Money.......................................... 65
7.8 Obligations as Lessee Under Operating Leases......................................... 65
7.9 Investments.......................................................................... 65
7.10 Fundamental Business Changes; Limitations on Non-Operating
Companies..................................................................................... 65
7.11 Sale or Transfer of Assets........................................................... 66
7.12 Amendment of Instruments............................................................. 66
7.13 Acquisition of Additional Properties................................................. 66
7.14 Issuance of Capital Stock; Debt Securities........................................... 66
7.15 Transactions with Affiliates......................................................... 66
7.16 Compliance with ERISA................................................................ 66
7.17 LMA Agreements....................................................................... 67
7.18 Business Locations................................................................... 67
7.19 Maximum Leverage Test................................................................ 67
7.20 Senior Debt Leverage................................................................. 68
7.21 Minimum Interest Coverage............................................................ 68
7.22 Minimum Fixed Charges................................................................ 68
ARTICLE VIII........................................................................................... 68
DEFAULT AND REMEDIES................................................................................... 68
8.1 Events of Default.................................................................... 68
8.1.1 Default in Payment.......................................................... 69
8.1.2 Breach of Covenants......................................................... 69
8.1.3 Breach of Warranty.......................................................... 69
8.1.4 Default Under Other Indebtedness for Borrowed Money......................... 69
8.1.5 Bankruptcy.................................................................. 69
8.1.6 Judgments................................................................... 70
8.1.7 Impairment of Licenses; Other Agreements.................................... 70
8.1.8 Collateral.................................................................. 70
8.1.9 Interruption of Operations.................................................. 70
8.1.10 Plans....................................................................... 71
8.1.11 Change in Control; Cessation of Wilson's Activities......................... 71
8.1.12 Guaranty.................................................................... 71
8.2 Acceleration of Borrower's Obligations............................................... 71
8.3 Rescission of Acceleration........................................................... 72
8.4 Remedies on Default.................................................................. 72
8.4.1 Remedies upon Acceleration.................................................. 72
(a) Enforcement of Security Interests........................................... 72
(b) Other Remedies.............................................................. 72
8.4.2 Blockage Notice............................................................. 72
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8.5 Application of Funds................................................................. 72
8.5.1 Expenses.................................................................... 72
8.5.2 Existing Prepayment Premium................................................. 72
8.5.3 Borrowers' Obligations...................................................... 73
8.5.4 Surplus..................................................................... 73
8.6 Performance of Borrower's Obligations................................................ 73
8.7 Right of Setoff...................................................................... 73
ARTICLE IX............................................................................................. 73
THE AGENT.............................................................................................. 73
9.1 Appointment.......................................................................... 73
9.2 Delegation of Duties................................................................. 74
9.3 Nature of Duties; Independent Credit Investigation................................... 74
9.4 Instructions from Lenders............................................................ 74
9.5 Exculpatory Provisions............................................................... 74
9.6 Reimbursement and Indemnification by Lenders of the Agent............................ 75
9.7 Reliance by Agent.................................................................... 75
9.8 Notice of Default.................................................................... 75
9.9 Release of Collateral................................................................ 75
9.10 Lenders in Their Individual Capacities............................................... 75
9.11 Holders of Notes..................................................................... 76
9.12 Successor Agent...................................................................... 76
9.13 Delivery of Information.............................................................. 76
9.14 Beneficiaries........................................................................ 76
ARTICLE X.............................................................................................. 77
LOAN ASSIGNMENT AND PARTICIPATION...................................................................... 77
10.1 Assignment to Other Lenders.......................................................... 77
10.1.1 Assignment.................................................................. 77
10.1.2 Effect of Assignment........................................................ 77
10.1.3 Register.................................................................... 77
10.1.4 Substitution of Notes....................................................... 77
10.2 Participations....................................................................... 78
ARTICLE XI............................................................................................. 78
CLOSING................................................................................................ 78
ARTICLE XII............................................................................................ 78
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EXPENSES AND INDEMNITY................................................................................. 78
12.1 Attorney's Fees and Other Fees and Expenses.......................................... 78
12.1.1 Fees and Expenses for Preparation of Loan Instruments....................... 78
12.1.2 Fees and Expenses in Enforcement of Rights or Defense of
Loan Instruments..................................................................... 79
12.2 Indemnity............................................................................ 79
12.2.1 Brokerage Fees.............................................................. 79
12.2.2 General..................................................................... 79
12.2.3 Operation of Collateral; Joint Venturers.................................... 79
12.2.4 Environmental Indemnity..................................................... 79
ARTICLE XIII........................................................................................... 80
MISCELLANEOUS.......................................................................................... 80
13.1 Notices.............................................................................. 80
13.2 Survival of Loan Agreement; Indemnities.............................................. 81
13.3 Further Assurance.................................................................... 82
13.4 Taxes and Fees....................................................................... 82
13.5 Severability......................................................................... 82
13.6 Waivers and Amendments............................................................... 82
13.7 Joint and Several Liability.......................................................... 82
13.8 Captions............................................................................. 83
13.9 Successors and Assigns............................................................... 83
13.10 Remedies Cumulative.................................................................. 83
13.11 Entire Agreement; Conflict........................................................... 83
13.12 APPLICABLE LAW....................................................................... 83
13.13 JURISDICTION AND VENUE............................................................... 83
13.14 WAIVER OF RIGHT TO JURY TRIAL........................................................ 84
13.15 TIME OF ESSENCE...................................................................... 84
13.16 Estoppel Certificate................................................................. 84
13.17 Consequential Damages................................................................ 85
13.18 Counterparts......................................................................... 85
13.19 No Fiduciary Relationship............................................................ 85
13.20 Notice of Breach by Agent and Lenders................................................ 85
13.21 Confidentiality...................................................................... 85
13.22 Governmental Approval................................................................ 85
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AMENDED AND RESTATED LOAN AGREEMENT
AMENDED AND RESTATED LOAN AGREEMENT, dated as of July 3, 1997, among
CITADEL BROADCASTING COMPANY, CITADEL LICENSE, INC. and FINOVA CAPITAL
CORPORATION, a Delaware corporation ("FINOVA"), in its individual capacity and
as agent for all Lenders (this and all other capitalized terms used herein are
defined in Section 1.1 below) and the other Lenders which are parties hereto.
PRELIMINARY STATEMENT:
A. The Original Borrowers and FINOVA, in its individual capacity and
as Agent for all Lenders, entered into a Loan Agreement dated as of October 9,
1996, which agreement was amended by amendments dated as of December 31, 1996,
February 14, 1997, April 10, 1997 and May 30, 1997 (collectively, the "Original
Loan Agreement").
B. Borrowers have requested Lenders' consent to, inter alia, (i) the
DAC Merger, the DLI Merger, the Tele-Media Acquisition and the Tele-Media
Merger, (ii) the issuance of the Senior Subordinated Notes and the Exchangeable
Preferred Stock, (iii) the consolidation of the Term Loan and Revolving Loan
into a revolving loan and (iv) the modification of certain of the covenants and
other provisions of the Original Loan Agreement.
C. Lenders are willing to grant such consent subject to the terms and
conditions set forth herein.
NOW THEREFORE, the Original Loan Agreement is amended and restated in
its entirety as follows:
ARTICLE I
DEFINITIONS AND DETERMINATIONS
1.1 Definitions. As used in this Loan Agreement and in the
other Loan Instruments, unless otherwise expressly indicated herein or therein,
the following terms shall have the following meanings (such meanings to be
applicable equally to both the singular and plural forms of the terms defined):
Accountants: KPMG Peat Marwick or any other independent certified
public accounting firm selected by Borrowers and reasonably
satisfactory to Required Lenders.
Accounting Changes: as defined in Section 1.3.
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Accounts Decrease: for any period, the excess of the Eligible
Accounts at the beginning of such period over the Eligible Accounts at
the end of such period.
Accounts Increase: for any period, the excess of Eligible
Accounts at the end of such period over the Eligible Accounts at the
beginning of such period.
Acquisition: an Asset Acquisition or an Equity Acquisition.
Acquisition Closing. the consummation of a Permitted Acquisition.
Acquisition Closing Date: the date of a Permitted Acquisition
Closing.
Acquisition Instruments: the purchase agreement and all
other documents executed in connection with a Permitted Acquisition.
Acquisition Loan Instruments: collectively, the following
documents to be executed and delivered in connection with a Permitted
Acquisition:
(i) any amendments to the Loan Instruments and any Mortgages,
Security Agreements, UCC Financing Statements and other
agreements required by Agent to (A) reflect the effect of
such Acquisition and (B) grant to Agent a perfected Lien,
subject only to Permitted Prior Liens, upon all Property
acquired by CBC upon the consummation (x) of such
Acquisition, if such acquisition is an Asset Acquisition or
(y) the Acquisition Merger, if such Acquisition is an
Equity Acquisition, and (z) to the extent permitted by
applicable law, the FCC Licenses (and the proceeds thereof)
transferred to CLI in connection with such Acquisition;
(ii) Assignment of Acquisition Instruments;
(iii) a Landlord's Consent executed by each Landlord under each
Lease assumed or executed by CBC in connection with such
Acquisition;
(iv) a Seller's Consent with respect to such Acquisition if such
consent is required to the applicable Assignment of
Acquisition Instruments; and
(v) such other instruments, documents, certificates, consents,
waivers, and opinions as Agent may reasonably require in
connection with such Acquisition.
Acquisition Merger: as defined in subsection 4.3.1.
Additional Closing: the disbursement of an Additional Loan.
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Additional Closing Date: the date of an Additional Closing.
Additional Loan: a loan made by Lenders to Borrowers on any
Additional Closing Date.
Adjusted Leverage Ratio: as of the end of any month the ratio of
the Adjusted Total Debt as of such date to Adjusted Operating Cash Flow
for the 12-month period ending on such date.
Adjusted Operating Cash Flow: for any twelve-month period or
Four-Quarter Period, as applicable, the Operating Cash Flow of CBC for
such period,
(i) plus the sum of the following:
(A) if a Permitted Acquisition has been made during
such period, the Operating Cash Flow of each
Station or Related Business which has been acquired
by CBC pursuant to such Acquisition, either
directly or as a result of an Acquisition Merger,
from the beginning of such period until the date
such Acquisition or Acquisition Merger was
consummated;
(B) when determining whether a proposed Acquisition
will be a Permitted Acquisition the Operating Cash
Flow for such period of the Station or Related
Business to be acquired, whether directly or as a
result of an Acquisition Merger, as determined to
the satisfaction of the Required Lenders based on
financial and other information submitted to Agent
by Borrowers; and
(C) such adjustments to the Operating Cash Flow of CBC
and such Station or Related Business for such
period as the Required Lenders reasonably deem
appropriate, based on information furnished to
Agent by Borrowers, to take into account reductions
or increases in expenses for said period which
would have been effected if such Acquisition had
been consummated at the beginning of such period.
(ii) minus the sum of the following:
(A) with respect to any Permitted Disposition made
within such period, the Operating Cash Flow of the
Station or Related Business which is the subject of
such Disposition from the beginning of such period
until the date of the consummation of such
Disposition; and
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(B) when determining whether a proposed Disposition
will be a Permitted Disposition the Operating Cash
Flow for such period of the Station or Related
Business which is the subject of such proposed
Disposition.
In calculating the Adjusted Operating Cash Flow for any period from
January 1, 1997 to the Closing Date the Operating Cash Flow of DAC for
such period shall be included.
Adjusted Total Debt: as of any applicable date, the Total Debt as
of such date (i) plus, when determining whether a proposed Acquisition
shall be a Permitted Acquisition or whether Borrowers are entitled to a
disbursement of an Additional Loan requested by Borrowers (A) the
amount of the Additional Loan requested by Borrowers and (B) in case of
a proposed Acquisition, the amount of Indebtedness for Borrowed Money
to be assumed by Borrowers in connection with such Acquisition or
Acquisition Merger, as applicable, and (ii) minus, when determining
whether a proposed Disposition shall be a Permitted Disposition, the
Principal Balance to be repaid from the proceeds of such Disposition.
Adjusted Total Leverage Ratio: as of the end of any month the
ratio of the Adjusted Total Debt as of such date to the Adjusted
Operating Cash Flow for the twelve-month period ending on such date.
Affiliate: any Person that directly or indirectly, through one or
more intermediaries, controls or is controlled by or is under common
control with another Person. The term "control" means possession,
directly or indirectly, of the power to direct or cause the direction
of the management and policies of a Person, whether through the
ownership of voting securities or equity interests, by contract or
otherwise. For the purposes hereof, any Person which owns or controls,
directly or indirectly, 10% or more of the securities or equity
interests, as applicable, whether voting or non-voting, of any other
Person shall be deemed to "control" such Person.
Agent: FINOVA, as agent for the Lenders.
Agent's Fee: as defined in subsection 2.5.4.
Amended and Restated Assignment of Leases: the Amended and
Restated Assignment of Leases executed by CBC in the form of
EXHIBIT 1A.
Amended and Restated Contribution Agreement: the Amended and
Restated Contribution Agreement between the Borrowers in the form of
EXHIBIT 1B.
Amended and Restated Guaranty: the Amended and Restated Guaranty
executed by Guarantor in the form of EXHIBIT 1C.
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Amended and Restated Security Agreement (CBC): the Amended and
Restated Security Agreement executed by CBC in the form of EXHIBIT 1D.
Amended and Restated Security Agreement (CLI): the Amended and
Restated Security Agreement executed by CLI in the form of EXHIBIT 1E.
Amended and Restated Stock Pledge Agreement (CBC Common Stock):
the Amended and Restated Stock Pledge Agreement executed by Guarantor
(CBC Common Stock) in the form of EXHIBIT 1F.
Amended and Restated Trademark Security Agreement: the Amended
and Restated Trademark Security Agreement executed by CBC in the form
of EXHIBIT 1G.
Amended and Restated Use Agreement: the Amended and Restated Use
Agreement among Borrowers and Tele-Media in form and substance
reasonably acceptable to Agent.
Amendment Fee: as defined in subsection 2.5.3.
Applicable Margin: as defined in subsection 2.5.1.
Applicable Ratio: on the last day of any month during the period
set forth below the ratio set forth opposite such period:
Each Month During Period Ratio
------------------------ -----
Closing Date through November 1997 6.75
December 1997 through May 1998 6.5
June 1998 through November 1998 6.25
December 1998 through May 1999 6.0
June 1999 through November 1999 5.75
December 1999 through May 2000 5.5
June 2000 through November 2000 5.25
December 2000 through May 2001 5.0
June 2001 through November 2001 4.75
December 2001 through May 2002 4.5
June 2002 through November 2002 4.25
December 2002 through June 2003 4.0
Asset Acquisition: an acquisition of Station Assets and the
related FCC Licenses or of Related Business Assets.
Assignee: any Person to which a Loan Assignment is made in
compliance with the provisions of subsection 10.1.1.
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Assignment and Acceptance: an Assignment and Acceptance Agreement
to be executed in connection with each Loan Assignment in the form of
EXHIBIT 1H.
Assignment of Acquisition Instruments: an Assignment of
Acquisition Instruments to be executed in connection with each
Permitted Acquisition in the form of EXHIBIT 1I.
Assignment of Interest Hedge Contract: the Assignment of Interest
Hedge Contract executed by the Original Borrowers pursuant to the
Original Loan Agreement.
Assignment of Key Man Life Insurance: the Assignment of the Key
Man Life Insurance executed by CBC pursuant to the Original Loan
Agreement.
Bankruptcy Code: the United States Bankruptcy Code and any
successor statute thereto, and the rules and regulations issued
thereunder, as in effect from time to time.
Base Rate: the per annum rate of interest announced or published
publicly from time to time by Citibank, N.A. in New York, New York as
its corporate base (or equivalent) rate of interest, which rate shall
change automatically without notice and simultaneously with each change
in such corporate base rate. The Base Rate is a reference rate and does
not necessarily represent the lowest or best rate actually charged to
any customer by Citibank, N.A. in New York, New York.
Base Rate Portion: the Principal Balance other than the portion
thereof consisting of LIBOR Loans.
Basic Financial Statements: as defined in subsection 6.3.3.
Borrower: either of the Borrowers.
Borrowers: CBC and CLI.
Borrowers' Obligations: (i) any and all Indebtedness due or to
become due, whether contingent or otherwise, now existing or hereafter
arising, of Borrowers to Lenders and/or Agent pursuant to the terms of
this Loan Agreement or any other Loan Instrument, including the
Existing Prepayment Premium and (ii) the performance of the covenants
of Borrowers contained in the Loan Instruments.
Broadcast Market: Each of the Stations or group of the CBC
Stations of a Borrower serving a specific geographical area or market
as set forth in EXHIBIT 1J.
Broadcasting Business: the business of owning and/or operating (i)
a Station, including the operation of a Station pursuant to an LMA,
(ii) the sale of advertising time for a Station pursuant to a JSA,
(iii) a Related Business and (iv) related ancillary activities.
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Business Day: (i) except as provided in clause (ii), any day other
than a Saturday, Sunday or other day on which banks in Chicago,
Illinois, are required or authorized to close, and (ii) with respect to
all notices, determinations, fundings and payments in connection with a
LIBOR Loan, any day which is a Business Day described in clause (i) and
which is also a day for trading by and between banks in Dollar deposits
in the applicable interbank eurodollar market.
Business Insurance: such property, casualty, business interruption
and other insurance, other than the Key Man Life Insurance and flood
insurance, as Agent from time to time reasonably requires CBC to
maintain.
Capital Expenditures: collectively, payments that are made or
liabilities that are incurred by CBC and DAC (but as to DAC only for
the period from January 1, 1997 through the Closing Date), other than
for a Permitted Acquisition, for the lease, purchase, improvement,
construction or use of any Property, the value or cost of which under
GAAP is required to be capitalized and appear on such Person's balance
sheet in the category of property, plant or equipment, without regard
to the manner in which such payments or the instruments pursuant to
which they are made are characterized by such Person or any other
Person. Except for the purpose of determining Excess Cash Flow, a
Capital Expenditure shall be deemed to be made as of the time the
Property which is the subject thereof is put into service by such
Person.
Capitalized Lease: any lease of Property, the obligations for the
rental of which are required to be capitalized in accordance with GAAP.
Cash Equivalents: collectively, the aggregate of each CBC's (i)
cash on hand or in any bank or trust company, and checks on hand and in
transit, (ii) monies on deposit in any money market account, and (iii)
treasury bills, certificates of deposit, commercial paper and readily
marketable securities at current market value having, in each instance,
a maturity of not more than 180 days.
CBC: Citadel Broadcasting Company.
CBC Common Stock: all of the issued and outstanding common stock
of CBC and all warrants, options and other equity interests issued and
outstanding with respect thereto.
CBC Stations: each of the Stations listed on EXHIBIT 1K.
Chief Financial Officer: the treasurer of CBC or any other Person
designated by CBC as its chief financial officer.
Certificate of Designation: the Certificate of Designation filed
on or prior to the Closing Date by CBC with the Secretary of State of
Nevada with respect to the Exchangeable Preferred Stock.
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CLI Capital Stock: all of the issued and outstanding capital
stock, warrants, options and other equity interests of CLI.
Closing: this Loan Agreement being deemed to becoming effective
pursuant to Section 4.1.
Closing Certificate: a Closing Certificate signed by the
President of each Borrower in form and substance reasonably acceptable
to Agent.
Closing Date: July 3, 1997.
Code: the Internal Revenue Code of 1986, as amended, and any
successor statute thereto, and the rules and regulations issued
thereunder, as in effect from time to time.
Collateral: (i) all existing and after-acquired Property of
Borrowers, including without limitation (A) all existing and
after-acquired accounts, equipment, general intangibles, (B) the Key
Man Life Insurance and (C) the Real Estate, (ii) the CBC Common Stock,
(iii) the CLI Capital Stock, (iv) the Tele-Media Capital Stock and (v)
all proceeds of the foregoing.
Commitment: shall mean, as to any Lender, the amount initially set
forth opposite its name in the column labeled "Commitment" on Schedule
I, less any reductions made pursuant to Sections 2.7 and subsection
2.8.1, as adjusted from time to time to reflect any Assignment and
Acceptances.
Commitments: at any time, the aggregate of each Lender's
Commitment.
Communications Act: the Communications Act of 1934 and the rules
and regulations issued thereunder, as amended and in effect from time
to time.
Compliance Certificate: a Compliance Certificate executed by the
Chief Financial Officer in the form of EXHIBIT 1L.
Corporate Overhead: during any period, the aggregate of all
compensation, traveling, entertainment, automobile and airplane
expenses of the Persons listed on EXHIBIT 1M incurred by the Obligors
and all other costs and expenses incurred by the Obligors which are not
allocable or are not incurred directly in the operation of any of the
CBC Stations, Related Businesses, any JSA Station or any LMA Station,
including, but not limited to any legal expenses and auditing fees,
minus the revenues received by the Obligors from users of the trade
name "Cat Country," but excluding the IPO Expenses.
DAC: Deschutes River Broadcasting, Inc., a Nevada corporation.
DAC Leases: each Lease described as a "DAC Lease" in EXHIBIT 1S.
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DAC Merger: the merger of DAC into CBC with CBC being the
surviving corporation.
DAC Merger Instruments: the articles of merger and all other
documents executed and/or filed in connection with the DAC Merger.
DAC Real Estate: each parcel of Real Estate described as "DAC
Real Estate" in EXHIBIT 1X.
Debt Service: during any period, all payments by Borrowers during
such period of principal, interest, loan fees and other charges made
with respect to Indebtedness for Borrowed Money, which payments are
required or permitted to be made pursuant to this Loan Agreement and
are due and payable during such period, but excluding payments made
pursuant to subsection 2.7.2.
Default Rate: with respect to (i) the Base Rate Portion and all
of the other of Borrowers' Obligations other than LIBOR Loans, a per
annum rate equal to the Base Rate in effect from time to time plus the
Applicable Margin plus 2.0% per annum and (ii) each LIBOR Loan, a per
annum rate equal to the LIBOR Rate applicable thereto plus the
Applicable Margin plus 2.0% per annum.
Default Rate Period: a period of time commencing on the date that
an Event of Default has occurred and ending on the date that such Event
of Default is cured or waived.
Disposition: any sale, lease, assignment, transfer or other
disposition of any Property by Borrowers of Station Assets and the
related FCC Licenses or Related Business Assets.
DLI: Deschutes License, Inc., a Nevada corporation.
DLI Licenses: the FCC Licenses issued to DLI with respect to the
Stations operated by DAC immediately prior to the DLI Merger.
DLI Merger: the merger of DLI into CLI with CLI being the
surviving corporation.
DLI Merger Instruments: the articles of merger and all other
documents executed in connection with the DLI Merger.
Eligible Accounts: at any given time, the aggregate of the face
amount of the accounts receivable of CBC, exclusive of any accounts
receivable over 60 days past due, net of applicable reserves and Trade
Out Transactions.
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Employee Benefit Plan: any employee benefit plan within the
meaning of Section 3(3) of ERISA which (i) is maintained for employees
of any Obligor or any ERISA Affiliate, or (ii) has at any time within
the preceding six years been maintained for the employees of any
Obligor or any current or former ERISA Affiliate.
Engineer: an engineer or engineers selected by CBC and acceptable
to Agent.
Environmental Audit: (i) a Phase I audit report with respect to a
parcel of real estate and such other studies and reports as Agent
reasonably deems necessary after review of the results of said Phase I
audit, including, if reasonably required by Agent, soil and ground
water tests, each such report and study to be in form and content and
issued by Persons reasonably acceptable to Agent and (ii) a letter from
each Person issuing each such report or study entitling Lenders to rely
thereon.
Environmental Certificate: the Environmental Certificate executed
by CBC in form and substance acceptable to Agent.
Environmental Compliance Certificate: an Environmental Compliance
Certificate executed by CBC in form and substance acceptable to Agent.
Environmental Laws: any and all federal, state and local laws that
relate to or impose liability or standards of conduct concerning public
or occupational health and safety or protection of the environment, as
now or hereafter in effect and as have been or hereafter may be amended
including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act (42 USC Section 9601 et seq.),
the Hazardous Materials Transportation Act (42 U.S.C. Section 1802 et
seq.), the Resources Conservation and Recovery Act (42 U.S.C. Section
6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C.
Section 1251 et seq.), the Toxic Substances Control Act (15 U.S.C.
Section 2601 et seq.), the Clean Air Act (42 U.S.C. Section 7901 et
seq.), the National Environmental Policy Act (42 U.S.C. Section 4231,
et seq.), the Refuse Act (33 U.S.C. Section 407, et seq.), the Safe
Drinking Water Act (42 U.S.C. Section 300(f) et seq.), the Occupational
Safety and Health Act (29 U.S.C. Section 651 et seq.), and all rules,
regulations, codes, ordinances and guidance documents promulgated or
published thereunder, and the provisions of any licenses, permits,
orders and decrees issued pursuant to any of the foregoing.
Equity Acquisition: an acquisition of the capital stock or other
equity interest of the Person or Persons which own Station Assets and
the related FCC Licenses or Related Business Assets.
ERISA: the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, and the rules and
regulations issued thereunder, as in effect from time to time.
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ERISA Affiliate: any Person who is a member of a group which is
under common control with any Obligor, who together with any Obligor is
treated as a single employer within the meaning of Section 414(b),(c),
and (m) of the Code.
Eurocurrency Reserve Requirements: for any day as applied to a
LIBOR Loan, the aggregate (without duplication) of the rates (expressed
as a decimal rounded upward to the nearest 1/100th of 1%) as determined
by Agent of reserve requirements in effect on such day (including,
without limitation, basic, supplemental, marginal and emergency
reserves under any regulations of the Board of Governors of the Federal
Reserve System of the United States or other Governmental Body, or any
successor thereto, having jurisdiction with respect thereto) prescribed
for Eurocurrency funding (currently referred to as "Eurocurrency
Liabilities" in Regulation D of such Board) maintained by a member bank
of the Federal Reserve System.
Event of Default: any of the Events of Default set forth in
Section 8.1.
Excess Cash Flow: (i) for any period, the aggregate for such
period of the (A) Operating Cash Flow of CBC and (B) Accounts Decrease,
(ii) minus, the aggregate of the following for such period: (w) Debt
Service, (x) amounts actually paid for Capital Expenditures permitted
to be incurred pursuant to this Loan Agreement, whether or not under
the definition "Capital Expenditures" such Capital Expenditures were
deemed to be made during such period, but excluding amounts paid from
the proceeds of Permitted Senior Indebtedness, (y) the Accounts
Increase, and (z) distributions for Corporate Overhead, subject to the
limitations set forth in subsection 7.6.1 and (iii) plus, for the year
1997, the Operating Cash Flow of DAC for the period from January 1,
1997 to the Closing Date.
Excess Interest: as defined in subsection 2.5.1(d).
Exchange Indenture: the Indenture dated as of July 1, 1997 among
Borrowers and The Bank of New York, as trustee, relating to the
Exchangeable Debentures.
Exchangeable Debentures: the Exchangeable Debentures due 2009
issued in exchange for Exchangeable Preferred Stock.
Exchangeable Debenture Indebtedness: the Indebtedness evidenced
by the Exchangeable Debentures.
Exchangeable Preferred Stock: the Series A Exchangeable Preferred
Stock issued by CBC on the Closing Date, any exchangeable preferred
stock issued in exchange therefor pursuant to the Preferred Stock
Registration Rights Agreement, and any exchangeable preferred stock
issued by CBC as dividends in accordance with the Certificate of
Designation.
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Exchangeable Preferred Stock Instruments: collectively, the
Certificate of Designation, the Preferred Stock Registration Rights
Agreement, the Exchange Indenture and the form of each of the
Exchangeable Preferred Stock and Exchange Debentures to be issued by
CBC, and the forms of the Exchangeable Preferred Stock certificates and
Exchangeable Debentures.
Existing Loan Instruments: collectively, the (i) Existing
Mortgages, (ii) Existing UCC Financing Statements, (iii) Assignment of
Interest Hedge Contract, (iv) Assignment of Key Man Life Insurance, (v)
Stock Pledge Agreement (CLI Capital Stock) and (vi) Existing
Assignments of Acquisition Instruments.
Existing Assignments of Acquisition Instruments: the Assignments
of Acquisition Instruments described in EXHIBIT 1N.
Existing Mortgages: the Mortgages described in EXHIBIT 1O.
Existing Prepayment Premium: the Prepayment Premium (as defined in
the Loan Agreement dated as of May 12, 1994 between CBC and FINOVA)
owed by CBC to FINOVA on the Original Closing Date in the amount of
$909,312, which was deemed to be fully earned on such date and which
shall be reduced on the last day of each quarter until the quarter
immediately preceding the quarter in which Borrowers' Obligations are
paid in full and the Commitments are terminated by an amount equal to
(i) 56.7% multiplied by the Principal Balance as of the last day of the
applicable quarter, the product of which is multiplied by (ii) .0625%
Existing UCC Financing Statements: the UCC Financing Statements
filed pursuant to the Original Loan Agreement.
FCC: the Federal Communications Commission or any Governmental
Body succeeding to its functions.
FCC Licenses: the Licenses issued by the FCC.
Fixed Charges: for any period, the sum for such period of (i)
Interest Expense, (ii) taxes paid, (iii) the amount actually paid
during such period for Capital Expenditures, whether or not under the
definition of "Capital Expenditures" such Capital Expenditure were
deemed to be made during such period and (iv) principal payments on the
Loans required pursuant to subsections 2.7.1 and 2.8.1.
Four-Quarter Period: the four quarters ending on the date
indicated.
Funding Date: the date of disbursement of an Additional Loan.
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GAAP: generally accepted accounting principles as in effect from
time to time, which shall include but shall not be limited to the
official interpretations thereof by the Financial Accounting Standards
Board or any successor thereto.
Good Funds: United States Dollars available in Federal funds to
Agent at or before 12:00 P.M., Chicago time, on a Business Day.
Governmental Body: any foreign, federal, state, municipal or
other government, or any department, commission, board, bureau, agency,
public authority or instrumentality thereof or any court or arbitrator.
Guarantor: Citadel Communications Corporation, a Nevada
corporation.
Guarantor's Obligations: any and all Indebtedness, due or to
become due, now existing or howsoever arising of Guarantor to Lenders
pursuant to the Amended and Restated Guaranty.
Hazardous Materials: any hazardous, toxic, dangerous or other
waste, substance or material defined as such in, regulated by or for
purposes of any Environmental Law.
Incipient Default: any event or condition which, with the giving
of notice or the lapse of time, or both, would become an Event of
Default.
Indebtedness: all liabilities, obligations and reserves,
contingent or otherwise, which, in accordance with GAAP, would be
reflected as a liability on a balance sheet or would be required to be
disclosed in a financial statement, including, without duplication: (i)
Indebtedness for Borrowed Money, (ii) obligations secured by any Lien
upon Property, except to the extent such obligation exceeds the value
of the Property which is subject to such Lien and is a non-recourse
obligation, (iii) the Reimbursement Obligation, (iv) guaranties,
letters of credit and other contingent obligations, and (v) liabilities
in respect of unfunded vested benefits under any Pension Plan or in
respect of withdrawal liabilities incurred under ERISA by CBC or any
ERISA Affiliate to any Multiemployer Plan.
Indebtedness for Borrowed Money: without duplication, all
Indebtedness (i) in respect of money borrowed, (ii) evidenced by a
note, debenture or other like written obligation to pay money
(including, without limitation, all of Borrowers' Obligations, the
Senior Subordinated Indebtedness, the Exchangeable Debenture
Indebtedness, and Permitted Senior Indebtedness), (iii) in respect of
rent or hire of Property under Capitalized Leases or for the deferred
purchase price of Property, (iv) in respect of obligations under
conditional sales or other title retention agreements, and (v) all
guaranties of any or all of the foregoing.
Initial Loan Instruments: collectively, the following documents:
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(i) Loan Agreement;
(ii) Notes;
(iii) Amended and Restated Assignment of Leases;
(iv) Assignment of Acquisition Instruments with respect
to Tele-Media Acquisition and Seller's Consent;
(v) Amended and Restated Security Agreement (CBC);
(vi) Amended and Restated Security Agreement (CLI);
(vii) Amended and Restated Trademark Security Agreement;
(viii) a Mortgage on each parcel of DAC Real Estate;
(ix) Amended and Restated Guaranty;
(x) Amended and Restated Stock Pledge Agreement (CBC
Common Stock);
(xi) Stock Pledge Agreement (Tele-Media Capital Stock);
(xii) UCC Financing Statements to cover the Property
(other than real estate) acquired by CBC pursuant to
the DAC Merger and the Property (other than real
estate) to be acquired by CBC upon the consummation
of the Tele-Media Merger;
(xiii) Closing Certificate;
(xiv) Solvency Certificate;
(xv) Environmental Certificate;
(xvi) Amended and Restated Contribution Agreement; and
(xvii) such other instruments and documents as Agent or
Lenders may require.
Instruments: collectively, the (i) Loan Instruments, (ii)
Amended and Restated Use Agreement, (iii) Senior Subordinated Debt
Documents, (iv) Exchangeable Preferred Stock Instruments, (v) DAC
Merger Instruments, (vi) DLI Merger Instruments, (vii) Tele-Media
Acquisition Instruments and (viii) Tele-Media Merger Instruments.
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Interest Expense: (i) for any period, the interest accrued during
such period on the Indebtedness for Borrowed Money of Borrowers,
excluding the Existing Prepayment Premium and (ii) in calculating
Interest Expense for any period from January 1, 1997 to the Closing
Date, the interest on any Indebtedness for Borrower Money of DAC shall,
without duplication, be included.
Interest Hedge Contract: an interest rate swap agreement between
Union Bank of California, N.A. and CBC dated December 12, 1996.
Interest Period: a period (i) commencing (A) on the applicable
Funding Date, if Borrowers prior thereto have elected pursuant to
subsection 2.6.1 to have all or a portion of the Loans to be disbursed
on such date bear interest from such date at a LIBOR Rate, (B) with
respect to the conversion of all or a portion of the Base Rate Portion
to a LIBOR Loan, on the Business Day specified by Borrowers in the
applicable LIBOR Election Notice and (C) with respect to the
continuation as a LIBOR Loan of all or a portion of a then existing
LIBOR Loan after the expiration of the Interest Period applicable to
such existing LIBOR Loan, on the day after the last day of the Interest
Period applicable to such existing LIBOR Loan, and (ii) ending 30, 90
or 180 days thereafter, as selected by Borrower in its LIBOR Election
Notice; provided, however:
(1) if any Interest Period otherwise would end on a day
that is not a Business Day, such Interest Period shall end on the
next succeeding Business Day, unless the result of such extension
would be to carry such Interest Period into another calendar
month, in which event such Interest Period shall end on the
immediately preceding Business Day; and
(2) any Interest Period that otherwise would extend
beyond the latest possible Maturity Date shall end on such date.
Interest Rate Determination Date: the date for determining a
LIBOR Rate, which date shall be two Business Days prior to the date of
commencement of the applicable Interest Period.
IPO: the unconsummated 1996 initial public offering of the
securities of Guarantor.
IPO Expenses: all legal and accounting expenses and all other
costs and expenses directly incurred in connection with the IPO in the
amount of $780,327.
Issuer: the Lender which issues a Permitted Letter of Credit.
Joint Sales Agreement: an agreement in which (i) two or more
licensees of Stations join to market air time or (ii) a licensee of a
Station sells air time to a broker.
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JSA Agreements: the Joint Sales Agreements described on
EXHIBIT 1P.
JSA Stations: the Stations listed on EXHIBIT 1Q.
Key Man Life Insurance: the life insurance on the life of Wilson
required pursuant to subsection 6.6.1.
KUBL Adjustment: the addition to Operating Cash Flow of $58,887
for June, 1996 and deduction from Operating Cash Flow of $63,157 for
July, 1996, $58,337 for August, 1996, $63,550 for September, 1996 and
$33,473 for October, 1996.
Landlord: each lessor under each Lease.
Landlord's Consent: a consent from each Landlord in form and
substance reasonably satisfactory to Agent.
L/C Expiration Date: the earlier of (i) September 30, 2002 or
(ii) the date on which the payment of Borrowers' Obligations are
accelerated.
L/C Guaranty: a guaranty in the form of EXHIBIT 1R pursuant to
which each Lender, in proportion to its Ratable Share, guarantees the
obligations of Borrowers to an Issuer.
L/C Guaranty Obligations: the obligations of Lenders pursuant to
L/C Guaranties.
L/C Issuance Date: the date as of which the applicable L/C
Guaranty is to be delivered to the Issuer, as set forth in the
applicable notice referred to in subsection 2.3(d).
Leases: the leases of real property described in EXHIBIT 1S.
Leasehold Property: any real estate which is the subject of a
Lease under which CBC is the lessee.
Lender Addition Agreement: an agreement executed by a Lender and
an Assignee pursuant to which a Loan Assignment is made.
Lenders: the financial institutions named on Schedule I and each
Assignee thereof.
Letter of Credit Fee: as defined in subsection 2.5.6.
Letter of Credit Fund: as defined in Section 2.10.
LIBOR Election Notice: a notice by Borrowers to Agent to have a
portion of the Principal Balance bear interest at a LIBOR Rate, in the
form of EXHIBIT 1T.
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LIBOR Loan: each portion of the Principal Balance which
bears interest determined by reference to a LIBOR Rate.
LIBOR Rate: for each Interest Period, a rate of interest
equal to (i) the rate per annum determined by Agent by dividing (the
resulting quotient rounded upward to the nearest 1/16 of 1% per annum)
(i) the rate of interest determined by Agent in accordance with its
usual procedures (which determination shall be conclusive absent
manifest error) to be the average of the London interbank offered
rates set forth on the "LIBO" page of the Bloomberg Service (or an
appropriate successor), or if Bloomberg Service or its successor
ceases to provide such quotes, a comparable replacement determined by
Agent on the Interest Rate Determination Date for an amount comparable
to the requested LIBOR Loan and having a maturity comparable to such
Interest Period by (ii) a number equal to 1.00 minus the Eurocurrency
Reserve Requirements. The LIBOR Rate may also be expressed by the
following formula:
Average of London interbank offered rates
on LIBO page of Bloomberg Service or
appropriate successor
-----------------------------------------
LIBOR Rate = 1.00 - Eurocurrency Reserve Requirements
The LIBOR Rate shall be adjusted with respect to any LIBOR Loan
outstanding on the effective date of any change in the Eurocurrency
Reserve Requirements as of such effective date. Agent shall give
prompt notice to Borrowers of the LIBOR Rate as determined or adjusted
in accordance herewith, which determination shall be conclusive absent
manifest error.
Licenses: all licenses, permits, consents, approvals and
authority issued by any Governmental Body which authorize a Person to
operate a Station.
Lien: any mortgage, pledge, assignment, lien, charge,
encumbrance or security interest of any kind, or the interest of a
vendor or lessor under any conditional sale agreement, Capitalized
Lease or other title retention agreement.
LMA: a local marketing arrangement, sale agreement, time
brokerage agreement, management agreement or similar arrangement
pursuant to which a Person, subject to customary preemption rights and
other limitations (i) obtains the right to sell at least a majority of
the advertising inventory of a radio station of which another Person
is the licensee, (ii) obtains the right to exhibit programming and
sell advertising time during a majority of the air time of a Station
or (iii) manages the selling operations of a Station with respect to
at least a majority of the advertising inventory of such Station.
LMA Agreements: each LMA described on EXHIBIT 1U.
LMA Stations: the Stations described on EXHIBIT 1V.
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Loan Agreement: this Amended and Restated Loan Agreement
and any amendments or supplements hereto.
Loan Assignment: as defined in subsection 10.1.1.
Loan Fees: collectively, the Agent's Fee, the Amendment
Fee, the Unused Commitment Fee and the Letter of Credit Fees.
Loan Instruments: collectively, the (i) Initial Loan
Instruments (ii) the Existing Loan Instruments, (iii) the Tele-Media
Loan Instruments and (iv) all Additional Loan Instruments.
Loan Year: a period of time from the Original Closing Date
or any anniversary of the Original Closing Date to the immediately
succeeding anniversary of the Original Closing Date.
Loans: the Revolving Loans and the Term Loan which shall be
consolidated into a revolving loan on the Closing Date and the
Additional Loans.
Market Cash Flow: for any Broadcast Market for any period:
(i) the revenues of the Stations of CBC in such Broadcast Market for
such period, exclusive of revenues from Trade Out Transactions, minus
(ii) the expenses of operating such Stations for such period,
exclusive of (A) expenses incurred in connection with Trade Out
Transactions, (B) Corporate Overhead, (C) Debt Service, (D) non-cash
compensation to employees of Borrowers and (E) depreciation and other
non-cash charges.
Material Adverse Effect: (i) a material adverse effect upon
the business, operations, Property, prospects, profits or condition
(financial or otherwise) of the Obligors, taken as a whole, or (ii) a
material impairment of the ability of any such Person to perform its
material obligations under any Loan Instrument to which it is a party
or of Agent or any Lender to enforce or collect any of Borrowers'
Obligations or Guarantor's Obligations.
Maturity Date: the earlier of (i) September 30, 2003 or
(ii) the date on which the payment of Borrowers' Obligations are
accelerated.
Maximum Rate: as defined in subsection 2.5.1(d).
Mortgage: a mortgage or deed of trust to be executed by CBC
in favor of Agent upon each parcel of Real Estate owned by CBC, in
form and substance reasonably acceptable to Agent.
Multiemployer Plan: any multiemployer plan as defined
pursuant to Section 3(37) of ERISA to which any Obligor or any ERISA
Affiliate makes, or accrues an obligation
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to make contributions, or has made, or been obligated to make,
contributions within the preceding six years.
Net Fee: As defined in subsection 2.5.6.
Net Sale Proceeds: the proceeds of any Permitted Disposition
less (i) the reasonable costs and expenses of any such Permitted
Disposition and (ii) such taxes as the Required Lenders reasonably
determine will be actually paid by the Obligors as a result of such
Permitted Disposition.
Notes: the promissory notes executed by Borrowers payable to
the order of each Lender, dated as of the Closing Date, in the amount
of such Lender's Loan Commitment, in form attached as EXHIBIT 1W, and
any notes issued in substitution thereof pursuant to subsection
10.1.4.
Note Indenture: the Indenture dated as of July 1, 1997
among Borrowers and The Bank of New York, as trustee, relating to the
issuance of the Senior Subordinated Notes.
Notes Registration Rights Agreement: the Registration
Rights Agreement entered into on or prior to the Closing Date among
Borrowers and the initial purchasers of the Subordinated Notes.
Obligor: any of the Obligors.
Obligors: collectively, the Borrowers and Guarantor.
Operating Agreement: any tower site lease, tower license,
office lease, studio lease, equipment lease, network affiliation
agreement, programming agreement, time brokerage agreement or other
similar agreement relating to the operation of a Station.
Operating Cash Flow: for any period, the net income of a
CBC, a Station or a Related Business, as applicable, for such period:
(i) plus the sum of the following (without
duplication), to the extent deducted in
determining such net income for such period:
(A) losses from sales, transactions,
exchanges and other dispositions of
Property not in the ordinary course of
business;
(B) interest, fees or other charges paid
or accrued on Indebtedness, including,
without limitation, interest on Capitalized
Leases that is imputed in accordance with
GAAP;
(C) depreciation and amortization;
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(D) income taxes which are accrued but not paid
during such period;
(E) non-cash expenses incurred in connection
with Trade Out Transactions;
(F) for the year 1996, the KUBL Adjustment and
the IPO Expenses;
(G) extraordinary and non-recurring losses not
in the ordinary course of business;
(H) casualty losses; and
(I) any other non-cash item deducted in
determining such net income;
(ii) minus the sum of the following (without
duplication), to the extent included in
determining such net income for such period:
(A) revenue received in connection with
Trade Out Transactions;
(B) proceeds of any insurance, other
than business interruption
insurance; and
(C) gains from sales, transactions,
exchanges and other dispositions
of Property not in the ordinary
course of business.
Operating Lease: any lease which, under GAAP, is not
required to be capitalized.
Original Borrowers: CBC, DAC, CLI and DLI.
Original Closing Date: October 9, 1996.
Original Loan Agreement: as defined in the Preliminary
Statement.
Participant: any Person to which a Lender sells or assigns
a Participation.
Participation: a sale or an assignment by a Lender of a
participating interest in (i) any portion of such Lender's interest in
Borrowers' Obligations and (ii) any of such Lender's other rights
under any of the Loan Instruments.
Participation Agreement: an agreement executed by a Lender
and a Participant pursuant to Section 10.2.
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PBGC: the Pension Benefit Guaranty Corporation or any
Governmental Body succeeding to the functions thereof.
Pension Plan: any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to the provisions of Part 3 of
Title I of ERISA, Title IV of ERISA, or Section 412 of the Code and
which (i) is maintained for employees of any Obligor or any ERISA
Affiliate, or (ii) has at any time within the preceding six years been
maintained for the employees of any Obligor or any of their current or
former ERISA Affiliates.
Permitted Acquisitions: an Acquisition (i) after the
consummation of which the Adjusted Leverage Ratio will not exceed the
Applicable Ratio as calculated as of the last day of the most recent
month preceding the closing date of such Acquisition for which
Borrowers have delivered to Lenders the financial statements and other
information reasonably necessary to enable Lenders to make such
calculation, provided that such delivery shall occur not less than 30
days prior to such closing date, (ii) if such Acquisition is of a
Related Business, the aggregate purchase price for such Acquisition
and any prior Acquisitions of Related Business Assets shall not exceed
$5,000,000, (iii) if such Acquisition is of one or more Stations,
either directly or as a result of an Acquisition Merger, such
Acquisition or Acquisition Merger would not result in more than 25% of
the aggregate of the Operating Cash Flow of CBC Stations to thereafter
be derived from Small Markets, as determined by Agent in its
reasonable discretion and (iv) if the conditions of Section 4.3 are
satisfied.
Permitted Dispositions: a Disposition after the consummation
of which the Adjusted Leverage Ratio calculated as of the last day of
the second month preceding the date of the projected closing of such
Disposition would not exceed the Applicable Ratio on such date.
Permitted Letter of Credit: An irrevocable stand-by letter
of credit (i) issued by an Issuer for the account of Borrowers, after
Borrowers have satisfied the requirements of Section 2.3 for the
issuance of an L/C Guaranty with respect thereto and subject to the
limitations of Section 2.2, (ii) to be used solely to secure the
obligations of Borrowers pursuant to agreements entered into by
Borrowers with respect to a proposed Acquisition or for such other
purposes as shall be approved by Agent and (iii) expiring no later
than one year after the applicable L/C Issuance Date.
Permitted Liens: any of the following Liens:
(i) the Security Interests;
(ii) the Permitted Senior Indebtedness Liens;
(iii) Liens for taxes or assessments and similar
charges, which either are (A) not delinquent or (B)
being contested diligently and in good faith by
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appropriate proceedings, and as to which CBC has set
aside reserves on its books which are required by
GAAP;
(iv) statutory Liens, such as mechanic's, material-man's,
warehouseman's, carrier's or other like Liens,
incurred in good faith in the ordinary course of
business, provided that the underlying obligations
relating to such Liens are paid in the ordinary
course of business, or are being contested
diligently and in good faith by appropriate
proceedings and as to which CBC has set aside
reserves on its books required by GAAP, or the
payment of which obligations are otherwise secured
in a manner satisfactory to Required Lenders;
(v) zoning ordinances, easements, licenses,
reservations, provisions, covenants, conditions,
waivers or restrictions on the use of Property and
other title exceptions, in each case, that are
reasonably acceptable to Required Lenders;
(vi) Liens in respect of appeal bonds, judgments or
awards with respect to which no Event of Default
would exist pursuant to subsection 8.1.6;
(vii) Liens to secure payment of insurance premiums
(A) to be paid in accordance with applicable laws in
the ordinary course of business relating to payment
of worker's compensation, or (B) that are required
for the participation in any fund in connection with
worker's compensation, unemployment insurance,
old-age pensions or other social security programs;
(viii) Liens to secure Indebtedness (other than
Indebtedness for Borrowed Money) not in excess of
$500,000 at any one time;
(ix) banker's Liens in respect to deposit accounts;
(x) statutory landlords' Liens and rights of
tenants under leases and subleases granted by CBC to
others, in each case not interfering in any material
respect with the business of CBC and arising in the
ordinary course of business;
(xi) deposits to secure the performance of bids, trade
contracts, government contracts, operating leases,
statutory obligations, surety and appeal bonds,
performance and return-of-money bonds or to secure
liabilities to insurance carriers under insurance or
self-insurance arrangements and other obligations of
a like nature, so long as, in each case with respect
to this clause (xi), such Liens do not secure
obligations constituting Indebtedness and are
incurred in the ordinary course of business; and
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(xii) Liens of any seller which is a party to a
proposed Acquisition by CBC with respect to any
escrow deposits to be maintained in connection with
such proposed Acquisition.
Permitted Prior Liens: the following:
(i) the Permitted Senior Indebtedness Liens;
(ii) the Permitted Liens described in clauses (iii)
and (iv) of such definition that are accorded
priority to the Security Interests by law; and
(iii) the Permitted Liens described in clauses (vi),
(vii), (viii), (x), (xi) and (xii) of such
definition, subject to the limitations set forth
therein.
Permitted Senior Indebtedness: Indebtedness, other than
Borrowers' Obligations, incurred to purchase tangible personal
property or Indebtedness incurred to lease tangible personal property
pursuant to Capitalized Leases, provided that (i) the amount of such
Indebtedness at any time outstanding shall not exceed $750,000 and
(ii) no Event of Default will exist after giving effect to the
incurrence of any such Indebtedness.
Permitted Senior Indebtedness Liens: Liens that secure
Permitted Senior Indebtedness, provided that (i) such Liens attach
only to the Property so purchased or leased and (ii) Agent is granted
a perfected Lien upon such Property, subject only to Permitted Prior
Liens.
Person: any individual, firm, corporation, limited liability
company or partnership, business enterprise, trust, association, joint
venture, partnership, Governmental Body or other entity, whether
acting in an individual, fiduciary or other capacity.
Preferred Stock Registration Rights Agreement: the
Preferred Stock Registration Rights Agreement entered into on or prior
to the Closing Date among the Borrowers and the initial purchasers of
the Exchangeable Preferred Stock.
Principal Balance: the unpaid principal balance of the
Loans or any specified portion thereof outstanding from time to time.
Prohibited Amendment. any proposed amendment after the
Closing Date to the Exchangeable Preferred Stock Instruments, the
Senior Subordinated Debt Instruments or the articles of incorporation
of either Borrower which adversely affects the Lenders, including:
(i) As to the Exchangeable Preferred Stock
Instruments, any amendment which:
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(A) changes the voting rights or the
conditions under which such rights may be exercised
by the holders of the Exchangeable Preferred Stock;
(B) increases the dividend or any other
payment payable to such holders, increases the rate
of interest or the amount of any other payment
payable with respect to the Exchangeable
Debentures, or accelerates the time of payment of
any such dividend, interest or other payment;
(C) has the effect of making the covenants
and restrictions set forth in the Exchangeable
Preferred Stock Instruments more restrictive;
(D) has the effect of increasing the
remedies of the holders of the Exchangeable
Preferred Stock or the Exchangeable Debentures upon
the occurrence of an event of default under the
Exchangeable Preferred Stock Instruments; or
(E) alters the provisions regarding
subordination or notice to the Agent of
acceleration set forth therein;
(ii) As to the Senior Subordinated Debt
Instruments, any amendment which:
(A) increases the rate of interest or the
amount of any other payment payable with respect to
the Senior Subordinated Notes or accelerates the
time of any such payment;
(B) has the effect of making the covenants
and restrictions set forth in the Senior
Subordinated Instruments more restrictive;
(C) has the effect of increasing the
remedies of the holders of the Senior Subordinated
Notes or the trustee under the Notes Indenture upon
the occurrence of an event of default under the
Senior Subordinated Debt Instruments; or
(D) alters the provisions regarding
subordination or notice to the Agent of
acceleration set forth therein.
Property: all types of real, personal or mixed property and
all types of tangible or intangible property.
Qualified Depository: a member bank of the Federal Reserve
System having a combined capital and surplus of at least $100,000,000.
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Ratable Share: at any time the proportion that a Lender's
Commitment bears to the total Commitments of all Lenders at such time.
Real Estate: the real property owned by CBC described on
EXHIBIT 1X.
Register: as defined in subsection 10.1.3.
Reimbursement Obligation: as defined in subsection 2.2.2.
Related Business: any business ancillary to the ownership
or operation of a Station or any business in which the majority of the
revenues are derived from the sale of advertising.
Related Business Assets: all Property used in the operation
of a Related Business.
Required Lenders: at any time, two or more Lenders who hold
not less than 66-2/3% of the Ratable Shares of all Lenders.
Remaining Excess Cash Flow: for any period, any Excess Cash
Flow remaining after any payment due for such period pursuant to
subsection 2.7.2(a) is paid to Agent.
Revolving Loan: as defined in the Original Loan Agreement.
SEC: the Securities and Exchange Commission and any
Governmental Body succeeding to any of its functions.
Securities Act: the Securities Act of 1933, as amended, or
any similar Federal statute, and the rules and regulations of the SEC
promulgated thereunder, as in effect from time to time.
Security Interests: the Liens in the Collateral granted to
Agent pursuant to the Loan Instruments.
Seller's Consent: a consent to an Assignment of Acquisition
Instruments, in form and substance reasonably satisfactory to Agent,
to be executed by the Seller of the Property which is the subject of a
Permitted Acquisition.
Seller Debt: the unsecured Indebtedness in the original
principal amount of $160,000 assumed by CBC in connection with the
Tele-Media Merger.
Senior Subordinated Debt Instruments: collectively, the
Note Indenture, the Notes Registration Rights Agreement, the form of
the Senior Subordinated Notes to be issued by CBC.
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Senior Subordinated Indebtedness: the Indebtedness in the
principal amount of $101,000,000 evidenced by the Senior Subordinated
Notes.
Senior Subordinated Notes: the Senior Subordinate Notes due
2007 in the aggregate principal amount of $ issued by CBC on
the Closing Date and the senior subordinated notes issued in exchange
therefor pursuant to the Notes Registration Rights Agreement.
Small Markets: Areas of "Dominant Influence" of size 150 or
smaller as determined in accordance with criteria established by The
Arbitron Company.
Solvency Certificate: a Solvency Certificate executed by
the Chief Financial Officer in form and substance reasonably
acceptable to Agent.
Stated Rate: as defined in subsection 2.5.1(d).
Station: a radio station operated to transmit over the
airwaves radio signals within a geographic area for the purpose of
providing commercial broadcasting radio programming.
Station Assets: all Property, other than the FCC Licenses,
used in operation of a Station.
Stock Pledge Agreement (CLI Capital Stock): the Stock
Pledge Agreement dated October 9, 1996 executed by CBC relating to the
CLI Capital Stock.
Stock Pledge Agreement (Tele-Media Capital Stock): the
Stock Pledge Agreement executed by CBC in form and substance
satisfactory to Agent relating to the Tele-Media Capital Stock.
Tele-Media: Tele-Media Broadcasting Company, a Delaware
corporation.
Tele-Media Acquisition: the Acquisition by CBC of all of the
Tele-Media Capital Stock pursuant to the Tele-Media Acquisition
Instruments following the (i) merger of Tele-Media Broadcasting
Holding Corporation and Tele-Media Broadcasting Company of Centre
Region into Tele-Media, (ii) dissolution and liquidation of all
Subsidiary Partnerships (as defined in the Tele-Media Acquisition
Instruments) and (iii) acquisition by Tele-Media of the Tele-Media
Property.
Tele-Media Acquisition Instruments: the Agreement of
Purchase and Sale dated March 28, 1997 among Tele-Media, Tele-Media
Broadcasting Company of Centre Region, Tele-Media Broadcasting Holding
Company, Robert E. Tudek, Everett I. Mundy and Borrowers and documents
executed pursuant thereto.
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Tele-Media Capital Stock: all of the issued and outstanding
capital stock, warrants, options and other equity interests of
Tele-Media.
Tele-Media Leases: each Lease described in EXHIBIT 1Y.
Tele-Media Licenses: the FCC Licenses used to operate the
Tele-Media Stations.
Tele-Media Loan Instruments: the documents to be executed
and delivered by CBC to Agent pursuant to Section 4.2.
Tele-Media Merger: the merger of Tele-Media into CBC with
CBC being the surviving corporation.
Tele-Media Merger Instruments: the articles of merger and
all other documents executed and/or filed in connection with the
Tele-Media Merger.
Tele-Media Property: all of the Purchased Assets, except
the Excluded Asset Schedule (each as defined in the Tele-Media
Acquisition Instruments) and the Tele-Media Licenses.
Tele-Media Real Estate: each parcel of Real Estate
described in EXHIBIT 1Z(i).
Tele-Media Stations: the Stations described in
EXHIBIT 1Z(ii).
Term Loan: as defined in the Original Loan Agreement.
Termination Event: (i) a "Reportable Event" described in
Section 4043 of ERISA and the regulations issued thereunder; or (ii)
the withdrawal of any Obligor or any ERISA Affiliate from a Pension
Plan during a plan year in which it was a "substantial employer" as
defined in Section 4001(a)(2); or (iii) the termination of a Pension
Plan, the filing of a notice of intent to terminate a Pension Plan or
the treatment of a Pension Plan amendment as a termination under
Section 4041 of ERISA; or (iv) the institution of proceedings to
terminate, or the appointment of a trustee with respect to, any
Pension Plan by the PBGC; or (v) any other event or condition which
would constitute grounds under Section 4042(a) of ERISA for the
termination of, or the appointment of a trustee to administer, any
Pension Plan; or (vi) the partial or complete withdrawal of any
Obligor or any ERISA Affiliate from a Multiemployer Plan; or (vii) the
imposition of a lien pursuant to Section 412 of the Code or Section
302 of ERISA; or (viii) any event or condition which results in the
reorganization or insolvency of a Multiemployer Plan under Sections
4241 or 4245 of ERISA; or (ix) any event or condition which results in
the termination of a Multiemployer Plan under Section 4041A of ERISA
or the institution by the PBGC of proceedings to terminate a
Multiemployer Plan under Section 4042 of ERISA.
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Total Debt: at any time, the aggregate (i) principal amount
of the Indebtedness for Borrowed Money of Borrowers and (ii) the
outstanding L/C Guaranty Obligations.
Total Leverage Ratio: the ratio of the Total Debt as of the
last day of any quarter to the Adjusted Operating Cash Flow for the
Four-Quarter Period ending on such day.
Trade Out Transaction: an exchange of advertising time for
non-cash consideration, such as goods, services or program material.
UCC Financing Statements: Uniform Commercial Code financing
statements as defined in the Uniform Commercial Code.
Unused Commitment Fee: as defined in subsection 2.5.5.
Wilson: Lawrence R. Wilson
Window Period: with respect to each Permitted Disposition,
a period of 180 days following the date of receipt by Lenders of the
Net Sale Proceeds thereof.
1.2 TIME PERIODS. In this Loan Agreement and the other Loan
Instruments, in the computation of periods of time from a specified date to a
later specified date, (i) the word "from" means "from and including," (ii) the
words "to" and "until" each mean "to, but excluding" and (iii) the words
"through," "end of" and "expiration" each mean "through and including." Unless
otherwise specified, all references in this Loan Agreement and the other Loan
Instruments to (i) a "month" shall be deemed to refer to a calendar month, (ii)
a "quarter" shall be deemed to refer to a calendar quarter and (iii) a "year"
shall be deemed to refer to a calendar year.
1.3 ACCOUNTING TERMS AND DETERMINATIONS. All accounting terms
not specifically defined herein shall be construed, all accounting
determinations and all computations hereunder shall be made and all financial
statements required to be delivered pursuant hereto shall be prepared in
accordance with GAAP as in effect at the time of such interpretation,
determination or preparation, as applicable. In the event that any Accounting
Changes (as hereinafter defined) occur and such changes result in a change in
the method of calculation of financial covenants, standards or terms contained
in this Loan Agreement, then Borrowers and Agent agree to enter into
negotiations to amend such provisions of this Loan Agreement so as to reflect
such Accounting Changes with the desired result that the criteria for
evaluating the financial condition of Borrowers shall be the same after such
Accounting Changes as if such Accounting Changes had not been made. Until such
amendments are agreed upon, all determination shall be based upon GAAP prior to
such Accounting Changes. For purposes hereof, "Accounting Changes" shall mean
(i) changes in generally accepted accounting principles required by the
promulgation of any rule, regulation, pronouncement or opinion by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants (or any successor thereto) or other
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appropriate authoritative body and (ii) changes in accounting principles as
approved by the Accountants.
1.4 REFERENCES. All references in this Loan Agreement to
"Article," "Section," "subsection," "subparagraph," "clause" or "Exhibit,"
unless otherwise indicated, shall be deemed to refer to an Article, Section,
subsection, subparagraph, clause or Exhibit, as applicable, of this Loan
Agreement.
1.5 BORROWERS' KNOWLEDGE. Any statements, representations or
warranties that are based upon the best knowledge of a Borrower or an officer
thereof shall be deemed to have been made after due inquiry by such Borrower or
such officer, as applicable, with respect to the matter in question.
1.6 BENEFIT OF LENDERS. All Liens granted to Agent and all
payments made to Agent pursuant to the Loan Instruments, except payments made
of the Agent's Fee and the Existing Prepayment Premium, shall be deemed to be
granted and made, as applicable, for the benefit of the Lenders.
ARTICLE II
LOANS AND TERMS OF PAYMENT
2.1 EXISTING LOANS; OUTSTANDING L/C GUARANTY OBLIGATIONS. On
the Closing Date (i) the Revolving Loan and Term Loan shall be consolidated
into the Loans and Borrowers shall make a principal payment to Agent of
$39,000,000, thereby reducing the Principal Balance to $50,584,043 and (ii) the
aggregate of the outstanding L/C Guaranty Obligations is $1,500,000.
2.2 ADDITIONAL LOANS; ISSUANCE OF L/C GUARANTIES.
2.2.1 OBLIGATION OF LENDERS. Subject to the conditions set forth
in Section 2.3, each Lender severally agrees to make Additional Loans
to Borrowers and to issue L/C Guaranties in behalf of Borrowers from
time to time on or after the Closing Date to the Maturity Date, in the
case of Additional Loans, and to the L/C Expiration Date, in the case
of L/C Guaranties (i) except Additional Loans shall be made pursuant to
subsection 2.4.3 after the Maturity Date (by acceleration) to pay L/C
Guaranty Obligations incurred pursuant to L/C Guaranties issued prior
to the L/C Expiration Date and (ii) provided at no time shall the
aggregate amount of (A) such Lender's Loans and L/C Guaranties exceed
such Lender's Commitment and the L/C Obligations of all Lenders exceed
$5,000,000. The failure of any Lender to perform its obligations
hereunder or under any other Loan Instrument shall not affect the
obligations of Borrowers under this Loan Agreement or any other Loan
Instrument nor shall any other Lender or Agent be liable for the
failure of such Lender to perform its obligations hereunder or under
such other Loan Instrument.
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2.2.2 OBLIGATIONS OF BORROWERS. Borrowers hereby agree to
protect, indemnify and save each Lender harmless from and against any
and all claims, demands, liabilities, damages, costs and expenses
(including reasonable attorneys fees) such Lender may incur or be
subject to as a consequence, direct or indirect, of the issuance of any
L/C Guaranty (the "Reimbursement Obligation").
2.3 CONDITIONS TO ADDITIONAL LOANS; L/C GUARANTIES. The
obligation of each Lender to make any Additional Loan or issue an L/C Guaranty
shall be subject to the satisfaction of each of the following conditions:
(a) no Event of Default shall exist after giving effect to the
disbursement of such Additional Loan or the issuance of such L/C
Guaranty;
(b) each Additional Loan shall be in a minimum amount of
$2,000,000 and integral multiples of $500,000 in excess of that amount;
(c) if an Additional Loan is requested, Agent shall have received
a Notice of Borrowing/Disbursement Request from Borrowers in the form
of EXHIBIT 2.3(c) with respect to each requested advance no later than
12:00 p.m., Chicago time, at least two Business Days in advance of the
proposed Funding Date with respect to such advance, which Funding Date
shall be on a Business Day;
(d) if Lenders are requested to issue an L/C Guaranty, Agent
shall have received a Notice of Issuance of L/C Guaranties from
Borrowers in the form of EXHIBIT 2.3(d) with respect to each such
request not later than 12:00 noon Chicago time at least three Business
Days in advance of the proposed L/C Issuance Date, which L/C Issuance
Date shall be a Business Day.
(e) if the proceeds of the Additional Loan are to be used to
consummate an Acquisition, the terms and conditions of Section 4.3
shall have been satisfied;
(f) the Adjusted Total Leverage Ratio shall not exceed the
Applicable Ratio as calculated as of the last day of the most recent
month preceding the applicable Funding Date or L/C Issuance Date for
which Borrowers have delivered to Lenders the financial statements and
other information reasonably necessary to enable Lenders to make such
calculation, provided that such delivery shall occur not less than 15
days prior to such Funding Date or L/C Issuance Date, as applicable;
(g) on the applicable Funding Date or L/C Issuance Date the
representations and warranties of each Obligor set forth in the Loan
Instruments to which such Obligor is a party shall be true and correct
when made and at and as of the time of such Funding Date or L/C
Issuance Date, except to the extent that such representations and
warranties expressly relate to an earlier date;
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(h) the terms and conditions of Section 4.2 shall have been
satisfied; and
(i) a certificate executed by the Chief Financial Officer that
the Borrowers are not prohibited by the Senior Subordinated Debt
Instruments from incurring the Indebtedness in connection with such
Additional Loan or L/C Guaranty, as applicable.
2.4 PROCEDURES FOR ADDITIONAL LOANS AND ISSUANCE OF L/C GUARANTIES.
2.4.1 MAKING ADDITIONAL LOANS OTHER THAN IN CONNECTION WITH L/C
GUARANTIES. Promptly after receipt by Agent of a request from Borrowers
for an Additional Loan, if the applicable conditions of Section 2.3
have been satisfied, subject to the limitations set forth in subsection
2.2.1, Agent shall notify each Lender of Agent's receipt of such
request and the satisfaction of such conditions, specifying: (i) the
proposed Funding Date, (ii) the amount of such Additional Loan and the
applicable Interest Period, if any, and (iii) the apportionment among
Lenders of such Additional Loan. Each Lender shall remit its Ratable
Share of such Additional Loan in Good Funds to Agent by 10:00 a.m.,
Chicago time, on the Funding Date and Agent shall thereupon remit the
funds received by Agent to or at the direction of Borrowers.
2.4.2 L/C GUARANTIES. Promptly after receipt by Agent of a
request from Borrowers for the issuance of an L/C Guaranty, if the
applicable conditions set forth in Section 2.3 have been satisfied,
subject to the limitations set forth in subsection 2.2.1, Agent shall
notify each Lender of Agent's receipt of such request and the
satisfaction of such conditions, specifying (i) the proposed L/C
Issuance Date, (ii) the amount of such L/C Guaranty, and (iii) the
apportionment among Lenders of the obligations under such L/C Guaranty
in accordance with their Ratable Shares. Each Lender shall execute such
L/C Guaranty and deliver such L/C Guaranty to Agent in Chicago, not
later than 11:00 a.m. Chicago time, one Business Day preceding the
applicable L/C Issuance Date and Agent shall thereupon deliver such L/C
Guaranty to the applicable Issuer.
2.4.3 ADDITIONAL LOANS IN CONNECTION WITH L/C GUARANTIES.
Promptly after receipt by Agent from an Issuer of any demand for
payment of any L/C Guaranty Agent shall notify each Lender of such
demand, specifying (i) the proposed Funding Date, (ii) the
apportionment among Lenders of the L/C Guaranty Obligations with
respect to such L/C Guaranty and (iii) the Interest Period, if any,
applicable to the Additional Loan to be made by Lenders to satisfy such
L/C Guaranty Obligations. Each Lender shall remit its Ratable Share of
such L/C Guaranty Obligations in Good Funds to Agent by 10:00 a.m.
Chicago time on the Funding Date and each such Lender shall be deemed
to have made an Additional Loan to Borrowers on such date in the amount
remitted. Agent shall on the Funding Date remit the funds received by
Agent to the applicable Issuer in payment of such L/C Guaranty
Obligations.
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2.5 INTEREST; DEFAULT RATE, LATE CHARGES, LOAN FEES AND AGENT'S FEES.
2.5.1 INTEREST.
(A) INTEREST RATE. Except as provided in subparagraph
(c) below, the Base Rate Portion shall bear interest at the
Base Rate in effect from time to time plus the Applicable
Margin and each LIBOR Loan shall bear interest at the
applicable LIBOR Rate plus the Applicable Margin. As used in
this Loan Agreement, the term "Applicable Margin" shall be
determined on the first day of each quarter and shall mean
with respect to the Base Rate Portion and each LIBOR Loan the
percentage set forth opposite the applicable Total Leverage
Ratio as calculated as of the last day of the second quarter
preceding such quarter:
Total Base Rate LIBOR Loan
Leverage Applicable Applicable
Ratio Margin Margin
-------- ---------- ----------
greater than 1.75% 2.75%
or equal to 5.5
greater than
or equal to 5.0 1.50% 2.50%
but less than 5.5
greater than
or equal to 4.5 1.00% 2.00%
but less than 5.0
less than 4.5 0.50% 1.50%
(B) INTEREST PAYMENTS. Interest shall be payable
quarterly in arrears on the last Business Day of each quarter
commencing with the third quarter of 1997.
(C) DEFAULT RATE. During a Default Rate Period,
Borrowers' Obligations shall bear interest at the applicable
Default Rate.
(D) MAXIMUM INTEREST. Notwithstanding any provision to
the contrary contained herein or in any other Loan
Instrument, Lenders shall not collect a rate of interest on
any obligation or liability due and owing by Borrowers to
Lenders in excess of the maximum contract rate of interest
permitted by applicable law ("Excess Interest"). Lenders and
Borrowers agree that the interest laws of the State of
Arizona govern the relationship among them, but in the event
of a final
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adjudication to the contrary, Borrowers shall be obligated
to pay, nunc pro tunc, to Lenders only such interest as then
shall be permitted by the laws of the state found to govern
the contract relationship among Lenders and Borrower. If any
Excess Interest is provided for or determined by a court of
competent jurisdiction to have been provided for in this
Loan Agreement or any other Loan Instrument, then in such
event (i) no Obligor shall be obligated to pay such Excess
Interest, (ii) any Excess Interest collected by Lenders
shall be, at Lenders' option, (A) applied to the Principal
Balance or to accrued and unpaid interest not in excess of
the maximum rate permitted by applicable law or (B) refunded
to the payor thereof, (iii) the interest rates provided for
herein (collectively, the "Stated Rate") shall be
automatically reduced to the maximum rate allowed from time
to time under applicable law (the "Maximum Rate") and this
Loan Agreement and the other Loan Instruments, as
applicable, shall be deemed to have been, and shall be,
modified to reflect such reduction, and (iv) neither any
Borrower nor any other Obligor shall have any action against
Lenders for any damages arising out of the payment or
collection of such Excess Interest; provided, however, that
if at any time thereafter the Stated Rate is less than the
Maximum Rate, Borrowers shall, to the extent permitted by
law, continue to pay interest at the Maximum Rate until such
time as the total interest received by Lenders is equal to
the total interest which Lenders would have received had the
Stated Rate been (but for the operation of this provision)
the interest rate payable. Thereafter, the interest rate
payable shall be the Stated Rate unless and until the Stated
Rate again exceeds the Maximum Rate, in which event the
provisions contained in this subsection 2.5.1(d) shall again
apply.
2.5.2 LATE CHARGES. If a payment of principal or interest to be
made pursuant to this Loan Agreement becomes past due for a period in
excess of five days, Borrowers shall pay on demand to Agent a late
charge of 2% of the amount of such overdue payment.
2.5.3 AMENDMENT FEE. Borrowers shall pay to Agent on the Closing
Date a fee of $100,000 (the "Amendment Fee"), which shall be deemed to
be fully earned upon the Closing.
2.5.4 AGENT'S FEE. Borrowers agree to pay to Agent for its own
benefit a fee (the "Agent's Fee") of $50,000 for each Loan Year or any
portion thereof elapsing during the period from the Closing Date
through the Maturity Date. The Agent's Fee shall be deemed fully earned
by Agent on the first Business Day of each Loan Year.
2.5.5 UNUSED COMMITMENT FEE. Borrowers shall pay to Agent a fee
(the "Unused Commitment Fee") on the last Business Day of each quarter,
commencing with the third quarter of 1997, in an amount equal to the
product of the (i) (A) average outstanding Commitments for the
preceding quarter, minus (B) the average of the
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outstanding Principal Balance of the Loans during such preceding
quarter, multiplied by (ii) 0.125%; provided, however, that such
percentage shall be reduced to 0.09375% for a quarter if the Total
Leverage Ratio calculated as of the last day of quarter preceding such
quarter was less than 4.5.
2.5.6 LETTER OF CREDIT FEES. Borrowers shall pay a fee to each
Issuer of 1.25% of the amount from time to time outstanding of each
Permitted Letter of Credit issued by such Issuer (the "Letter of Credit
Fee"). Letter of Credit Fees shall be payable to the applicable Issuer
quarterly in arrears on the last Business Day of each quarter. The
Issuer shall retain 10% of each such payment as compensation for its
issuance of the applicable Permitted Letter of Credit and shall remit
the balance of such payment (the "Net Fee") to Agent for distribution
to Lenders pursuant to subsection 2.12.2.
2.5.7 COMPUTATION OF INTEREST, UNUSED COMMITMENT FEES AND LETTER
OF CREDIT FEES. Interest, the Unused Commitment Fee and Letter of
Credit Fees shall be computed on the basis of a year consisting of 360
days and charged for the actual number of days during the period for
which interest or such fees are being charged. In computing interest,
the Funding Date shall be included and the date of payment shall be
excluded.
2.6 LIBOR LOANS.
2.6.1 ELECTION BY BORROWERS. Subject to the provisions of
subsection 2.6.2 and provided no Event of Default then exists,
Borrowers from time to time may elect to have all or a portion of the
Principal Balance bear or continue to bear interest at a LIBOR Rate,
such election to be exercised by delivery of a LIBOR Election Notice to
Agent c/o Andrew J. Pluta, FINOVA Capital Corporation, 311 S. Wacker
Drive, Chicago, Illinois 60606, Telecopy No. (312) 322-3533, by
facsimile transmission not less than three Business Days prior to the
commencement of the applicable Interest Period. Agent shall promptly
thereafter send a copy of such notice to each Lender. Agent shall
determine (which determination shall, absent manifest error, be
presumptively correct) the LIBOR Rate applicable to the relevant LIBOR
Loan on the applicable Interest Rate Determination Date and promptly
shall give notice thereof to Borrowers. Agent and Lenders shall have
the right without further confirmation to assume that any LIBOR
Election Notice received by Agent has been given by a person duly
authorized to act on behalf of Borrowers. Upon the expiration of an
Interest Period the applicable LIBOR Loan shall be converted to and
become part of the Base Rate Portion unless such LIBOR Loan has been
continued as a LIBOR Loan in accordance with this subsection 2.6.1. If
Borrowers deliver a LIBOR Election Notice to Agent and thereafter
withdraw such election before it becomes effective, Borrowers shall
reimburse Lenders on demand for the amount of any loss, cost and/or
expense incurred by Lenders as a result of Lenders' reliance on such
notice, including without limitation, any loss, cost or expense
resulting from Lenders' contractual obligations in connection with the
applicable Dollar deposits.
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2.6.2 LIBOR LIMITATIONS. Each LIBOR Loan shall be in the amount
of not less than $25,000,000 or in integral multiples of $1,000,000 in
excess thereof. At no time shall more than six LIBOR Loans be in
effect.
2.6.3 EURODOLLAR DEPOSITS UNAVAILABLE OR INTEREST RATE
UNASCERTAINABLE. If, prior to the commencement of any Interest Period,
the Required Lenders determine that Dollar deposits of the relevant
amount for the relevant Interest Period are not available in the London
Interbank Market or the rate at which such Dollar deposits are being
offered will not adequately and fairly reflect the cost to the Lenders
of maintaining a LIBOR Rate for such Interest Period, or that by reason
of circumstances affecting such market, adequate and reasonable means
do not exist for ascertaining the LIBOR Rate applicable to such
Interest Period, Agent promptly shall give notice of such determination
to Borrowers and Lenders and any LIBOR Election Notice previously given
by Borrowers which has not yet become effective shall be deemed to be
cancelled.
2.6.4 TAX AND OTHER LAWS. In the event that by reason of any law,
regulation or requirement or interpretation thereof by any Governmental
Body, or the imposition of any requirement of any such Governmental
Body, whether or not having the force of law, including the imposition
of any reserve and/or special deposit requirement (other than reserves
included in the Eurocurrency Reserve Requirements), any Lender shall be
subjected to any tax, levy, impost, charge, fee, duty, deduction or
withholding of any kind whatsoever (other than any tax imposed upon the
total net income of such Lender) and if any such measures or any other
similar measure shall result in an increase in the cost to any Lender
of maintaining its share of any LIBOR Loan or in a reduction in the
amount of principal or interest receivable by any Lender in respect
thereof, then Borrowers shall pay to the affected Lender within 10 days
after receipt of a notice from such Lender (which notice shall be
accompanied by a statement in reasonable detail setting forth the basis
for the calculation thereof, which calculation, in the absence of
demonstrable error, shall be conclusive and binding and a copy of such
notice concurrently therewith shall be delivered to Agent), an amount
equal to such increased cost or reduced amount. At any time after
receipt of such notice, Borrowers may convert all LIBOR Loans to the
Base Rate Portion, and such conversion shall be effective three
Business Days after the Agent has received notice from Borrowers of
such conversion.
2.6.5 CHANGES IN LAW RENDERING LIBOR LOANS UNLAWFUL. If at any
time any law, treaty or regulation, or any interpretation thereof by
any Governmental Body shall make it unlawful for any Lender to fund or
maintain its share of any LIBOR Loan with monies obtained in the London
Interbank Market, such Lender, upon the occurrence of such event, shall
notify Borrower thereof (and a copy of such notice concurrently shall
be delivered to Agent) and thereupon the (i) right of Borrowers to make
any LIBOR Election shall be suspended for the duration of such
illegality and (ii) if required by such law, regulation or
interpretation, on such date as shall be specified in such notice all
Interest Periods then in effect with respect to the affected Lender
shall be terminated, and
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thereafter all LIBOR Loans with respect to the affected Lender shall
be deemed converted to the Base Rate Portion.
2.6.6 INDEMNITY. In addition to any other payments payable by
Borrowers to Lenders pursuant to the Loan Instruments, Borrowers shall
indemnify and reimburse each Lender on demand for any loss or expense
which such Lender may sustain as a consequence of any prepayment of any
LIBOR Loan prior to the expiration of the Interest Period applicable
thereto and/or any failure by Borrowers to (i) make any payment when
due of any amount payable with respect to any LIBOR Loan or (ii) borrow
the amount set forth in any LIBOR Election Notice on the date specified
therefor.
2.6.7 OPTION TO REPLACE AFFECTED LENDER. Within 15 days after
receipt by Borrowers of notice from Agent or any Lender for payment of
additional costs as provided in subsection 2.6.4 or for suspension
pursuant to subsection 2.6.5 of Borrowers' right to have all or a
portion of the Principal Balance bear interest with reference to a
LIBOR Rate, Borrowers may, at their option, notify Agent and the Lender
giving such notice of their intention to obtain, at Borrowers' expense,
a replacement Lender for the Lender giving such notice, which
replacement Lender shall be reasonably satisfactory to Agent and
Borrowers. In the event Borrowers obtain such replacement Lender within
90 days following notice of their intention to do so, the Lender giving
such notice shall sell and assign its Commitments to such replacement
Lender, provided that Borrowers reimburse the Lender giving such notice
for the increased costs for which it is entitled to reimbursement under
this Loan Agreement through the date of such sale and assignment.
2.7 REDUCTIONS OF COMMITMENTS, PRINCIPAL PAYMENTS.
2.7.1 MANDATORY REDUCTIONS OF COMMITMENTS AND PRINCIPAL PAYMENTS.
The Commitments shall be permanently reduced on the last Business Day
of each quarter commencing with the last quarter of the year 1997 in
accordance with EXHIBIT 2.7.1. On each such Business Day, Borrowers
shall pay to the Agent, for application to the Principal Balance, the
amount, if any, by which the aggregate of the Principal Balance and the
L/C Guaranty Obligations outstanding exceeds the Commitments, as
reduced on such Business Day.
2.7.2 OTHER MANDATORY REDUCTIONS OF COMMITMENTS; PREPAYMENTS OF
THE LOANS. In addition to the permanent reductions in the Commitments
pursuant to subsection 2.7.1, Borrowers shall make the following
payments to Agent which shall be applied to the Principal Balance and
permanently reduce the Commitments.
(a) EXCESS CASH FLOW PAYMENTS. For each year commencing
with the year 1997 with respect to which the Total Leverage
Ratio as of the end of such year is 4.5 or greater, Borrowers
shall pay to Agent an amount equal to the
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lesser of (i) (A) if the Total Leverage Ratio as of the end
of such year exceeds 5.5, then 66-2/3% of the Excess Cash
Flow for such year and (B) if the Total Leverage Ratio as of
the end of such year is 4.5 or greater, but less than or
equal to 5.5, then 50% of the Excess Cash Flow for such
year, or (ii) an amount by which the Cash Equivalents as of
the last day of March following such year exceeds
$5,000,000. Each such payment shall be made within 30 days
after the date that Borrowers are required to deliver to
Lenders the financial statements for such year pursuant to
subsection 6.3.3. Each Borrower agrees that it will not take
any actions primarily intended to decrease the amount
payable under this subsection 2.7.2(a) in anticipation of
the calculation referred to herein.
(b) PROCEEDS OF KEY MAN LIFE INSURANCE. Proceeds of Key
Man Life Insurance.
(c) NET SALE PROCEEDS. Net Sale Proceeds, but only to the
extent that such Net Sale Proceeds exceed the aggregate of
the Additional Loans made for Permitted Acquisitions during
the Window Period applicable to the Permitted Disposition
from which such Net Sale Proceeds arose.
2.8 VOLUNTARY REDUCTIONS IN COMMITMENTS AND PREPAYMENTS;
PREPAYMENT PREMIUMS.
2.8.1 VOLUNTARY REDUCTION OF COMMITMENTS. Borrowers may
permanently reduce the Commitments at any time and from time to time,
in whole or in part, by notice to Agent accompanied by payment to Agent
of an amount equal to the excess, if any, of the aggregate of the
Principal Balance and the L/C Guaranty Obligations at the time of such
notice over the Commitments at such time, after giving effect to the
applicable reduction. Each reduction shall be in an amount not less
than $5,000,000 or multiples of $1,000,000 in excess thereof.
2.8.2 VOLUNTARY PREPAYMENTS. Borrowers may prepay (i) all or any
portion of the Base Rate Portion of the Loans at any time and (ii) all
of any Loan which is a LIBOR Loan on the last day of the Interest
Period applicable thereto, in each case without premium or penalty, but
in each case subject to the following conditions:
(a) NOTICE OF PREPAYMENT; NUMBER AND AMOUNT OF
PREPAYMENTS. Not less than 10 days prior to the date upon
which Borrowers desire to make any voluntary prepayment of
the Loans, Borrowers shall deliver to Lenders notice of their
intention to prepay, which notice shall state the prepayment
date, the amount of the Principal Balance to be prepaid. The
amount of any partial prepayment of the Principal Balance
shall be not less than $5,000,000 or multiples of $1,000,000
in excess thereof. A prepayment of the Principal Balance
shall not be made more frequently than once each month. If
Borrowers
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deliver to Lenders a notice of prepayment and fail to make
such prepayment, such notice shall be deemed to be revoked
and Borrowers shall reimburse Lenders on demand in the
amount of any loss, cost and/or expense incurred by Lenders
as a result of Lenders' reliance on such notice, including
without limitation, any loss, cost or expense resulting from
Lenders' contractual obligations in connection with the
reinvestment of the amount indicated in such notice of
prepayment.
(b) ADDITIONAL PAYMENTS. Concurrently with any
prepayment in full of the Principal Balance pursuant to this
subsection 2.8.2, Borrowers shall pay to Agent all of the
other of Borrowers' Obligations.
2.8.3 PREMIUMS. No prepayment premium or other charge shall be
payable with respect to any payments or prepayments of Borrowers'
Obligations, except (i) as provided in subsection 2.6.6 and (ii) the
Existing Prepayment Premium.
2.9 PAYMENT AT MATURITY. All of Borrower's Obligations not previously
paid shall be due and payable on the Maturity Date.
2.10 LETTER OF CREDIT FUND. To the extent that any payment of
Borrowers' Obligations includes payment of the Reimbursement Obligation with
respect to L/C Guaranty Obligations outstanding on the date of such payment,
Agent shall deposit in a segregated interest bearing account selected by and
under the control of Agent an amount equal to such payment of such
Reimbursement Obligation (the "Letter of Credit Fund"). The Letter of Credit
Fund shall be used to make any payments required to be made to any Issuer with
respect to such L/C Guaranty Obligations. Any funds remaining on deposit in the
Letter of Credit Fund, including earnings thereon, shall be remitted to
Borrower after all of such L/C Guaranty Obligations have been satisfied.
2.11 PAYMENTS AFTER EVENT OF DEFAULT. All payments received by
Lenders during the existence of an Event of Default shall be applied in
accordance with Section 8.5.
2.12 METHOD AND DISTRIBUTION OF PAYMENTS.
2.12.1 METHOD OF PAYMENT; GOOD FUNDS. All payments to be made
pursuant to the Loan Instruments by Borrowers shall be made by wire
transfer of Good Funds on or prior to the date due to the account of
Agent, for the ratable benefit of Lenders, at Citibank, N.A., 399 Park
Avenue, New York, New York, ABA 021000089, Credit: FINOVA Capital
Corporation, Credit Account No. 40680477, Reference Citadel No. 20995,
or to such other account as Agent shall notify Borrowers.
2.12.2 DISTRIBUTION OF PAYMENTS. All payments received by Agent
of the Agent's Fee and the Existing Prepayment Premium shall be
retained by FINOVA. All
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other payments with respect to Borrowers' Obligations shall be
allocated among the Lenders in accordance with their respective
Ratable Shares.
2.12.3 DISTRIBUTIONS BY AGENT TO LENDERS. All payments which are
received by Agent which are to be distributed to Lenders and which
constitute Good Funds on or prior to 12:00 p.m. Chicago time on any
date shall be distributed by Agent to Lenders on the same date in
immediately available funds.
ARTICLE III
SECURITY; GUARANTY
3.1 SECURITY. Borrowers' Obligations shall be secured by a
Lien upon all of the Collateral, which at all times shall be superior and prior
to all other Liens, except Permitted Prior Liens.
3.2 GUARANTY. Payment and performance of Borrowers' Obligations
shall be guaranteed by Guarantor in accordance with the terms of the Guaranty.
ARTICLE IV
CONDITIONS OF CLOSINGS; ACQUISITIONS; TELE-MEDIA MERGER
4.1 CLOSING. This Loan Agreement shall not be deemed to
be effective until all of the following conditions are satisfied in a manner
satisfactory to Lenders:
4.1.1 REPRESENTATIONS AND WARRANTIES. On the Closing Date the
representations and warranties of each Obligor set forth in the Loan
Instruments to which such Obligor is a party shall be true and correct
when made and at and as of the time of the Closing, except to the
extent that such representations and warranties expressly relate to an
earlier date.
4.1.2 CONSUMMATION OF MERGERS; TELE-MEDIA ACQUISITION. Agent
shall have received evidence of the following:
(a) DAC MERGER. the consummation of the DAC Merger
and the acquisition by CBC as a result thereof of good and
marketable title to all Property of DAC, free and clear of
all Liens and Indebtedness, except Permitted Liens and
current trade indebtedness incurred in the normal course of
business;
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(b) DLI MERGER. the consummation of the DLI
Merger and the acquisition by CLI as a result thereof of all
FCC Licenses held by DLI prior to the DLI Merger, free and
clear of all liens, except Permitted Liens;
(c) TELE-MEDIA ACQUISITION. the consummation of
the Tele-Media Acquisition and the payment of the Bond
Pay-Off Amount and FINOVA Pay-Off Amount (each as defined in
the Tele-Media Acquisition Instruments);
(d) SENIOR SUBORDINATED NOTES. the execution of
the Senior Subordinated Debt Instruments, the issuance of the
Senior Subordinated Notes and the receipt by CBC of the
proceeds of such sale, which shall not be less than
$100,000,000, less applicable fees and expenses;
(e) EXCHANGEABLE PREFERRED STOCK. the execution
of the Exchangeable Preferred Stock Instruments, the sale of
the Exchangeable Preferred Stock and the receipt by CBC of
the proceeds of such sale, which shall not be less than
$100,000,000, less applicable fees and expenses.
4.1.3 DELIVERY OF DOCUMENTS. The following shall have been
delivered to Agent, each duly authorized and executed, where
applicable:
(a) the Initial Loan Instruments;
(b) signature and incumbency certificates for
each Obligor;
(c) a certificate of good standing or similar
certification for each Obligor from the respective states in
which each such Person is organized and from all states in
which the laws thereof require any such Person to be
licensed and/or qualified to do business, in each case dated
not more than 10 days prior to the Closing Date;
(d) certified copies of the corporate charter and
by-laws for each Obligor, together with all effective and
proposed amendments thereto;
(e) certified copies of resolutions adopted
by the board of directors of each Obligor authorizing the
execution and delivery of the Instruments to which such
Person is a party and the consummation of the transactions
contemplated therein;
(f) certified or executed original copies of
each of the following, the terms and conditions of all of
which shall be satisfactory to Agent:
(i) Tele-Media Acquisition Instruments;
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(ii) DAC Merger Instruments;
(iii) DLI Merger Instruments;
(iv) all of the following, except to the extent
previously delivered to Agent:
(A) all instruments and documents evidencing
Permitted Senior Indebtedness;
(B) JSA Agreements;
(C) LMA Agreements;
(D) Leases;
(v) Amended and Restated Contribution Agreement;
(vi) Amended and Restated Use Agreement;
(vii) such other instruments, documents, certificates,
consents, waivers and opinions as Agent may
reasonably request; and
(viii) certificates representing all of the Tele-Media
Capital Stock and executed stock powers in form
acceptable to Agent.
4.1.4 PERFORMANCE; NO DEFAULT. Each Obligor shall have performed
and complied with all agreements and conditions contained in the
Initial Loan Instruments to be performed by or complied with by such
Person prior to or at the Closing, and no Event of Default or Incipient
Default shall then exist or result from the making of the Initial Loan.
4.1.5 OPINIONS OF COUNSEL. Agent shall have received opinions
dated the Closing Date from (i) Osborn Maledon and Eckert Seamans
Cherin & Mellott, counsel to Obligors, (ii) Hartman & Armstrong, Ltd.,
Nevada special counsel to Obligors, (iii) Reed, Smith, Shaw & McClay,
FCC counsel to each Borrower, and (iv) Adler, Pollack & Sheehans in
each case addressed to Agent for the benefit of Lenders, and in such
form and covering such matters as Agent may reasonably require.
4.1.6 APPROVAL OF INSTRUMENTS AND SECURITY INTERESTS. Agent shall
have received evidence that the approval or consent shall have been
obtained from all Governmental Bodies, including, without limitation,
the FCC, and all other Persons whose approval or consent is required to
enable Obligors to (i) enter into and perform
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their respective obligations under the Instruments to which each such
Person is a party and (ii) grant Agent the Security Interests.
4.1.7 SECURITY INTERESTS. All filings of UCC Financing
Statements, all recordings of Mortgages and all other filings and
actions necessary to perfect and maintain the Security Interests as
first, valid and perfected Liens in the Property covered thereby,
subject only to Permitted Prior Liens, shall have been filed or taken
and Agent shall have received such Uniform Commercial Code and other
Lien searches as it deems necessary to confirm the foregoing.
4.1.8 FCC LICENSES. Agent shall have received (i) evidence that
the FCC Licenses described in Exhibit 5.52 constitute all FCC Licenses
which are necessary to enable CBC to conduct its Broadcasting Business
with respect to the CBC Stations, (ii) such FCC Licenses are in full
force and effect as of the Closing Date, (iii) no event has occurred
that could result in the termination, revocation or non-renewal of any
such FCC License and (iv) the FCC has approved the transfer to CLI of
the DLI Licenses and the Tele-Media Licenses and no objection has been
filed to such approval.
4.1.9 LMA AGREEMENTS. Agent shall have received evidence that (i)
all of the LMA Agreements are in full force and effect, and (ii) the
approval or consent shall have been obtained from all Governmental
Bodies, including, without limitation, the FCC, and all other Persons
whose approval or consent is required to enable CBC to perform its
obligations and receive the benefits of such LMA Agreements.
4.1.10 FINANCIAL STATEMENTS, REPORTS AND PROJECTIONS. Lenders
shall have received the financial statements and reports described in
EXHIBIT 5.7.1 and the projections described in EXHIBIT 5.7.2.
4.1.11 MATERIAL ADVERSE CHANGE. No event shall have occurred
since May 31, 1997, which has had or reasonably could be expected to
have a Material Adverse Effect.
4.1.12 USE OF ASSETS. Agent shall be satisfied that each Borrower
at all times shall be entitled to the use and quiet enjoyment of all
Property necessary for the continued ownership and operation of its
business, including, without limitation, the use of equipment,
fixtures, FCC Licenses, offices and means of ingress and egress
thereto, and any easements or rights-of-way necessary to reach any
equipment or other items necessary for the operation of such business.
4.1.13 BROKER FEES. If the services of a broker or other agent
have been used in connection with the Loans, all fees owed to such
broker or agent shall have been paid by Borrowers and Agent shall have
received evidence of such payment.
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4.1.14 INSURANCE.
(A) TITLE POLICIES. Agent shall have received an ALTA
mortgagee's policy of title insurance (ALTA Revised 1987 Form or
such other form acceptable to Agent) in favor of Agent with
respect to each parcel of DAC Real Estate, issued by a title
company or companies and in an amount satisfactory to Agent,
showing that CBC is the owner of such parcel, and has good and
marketable title thereto and insuring that the Mortgage covering
such parcel constitutes a valid Lien on such parcel, subject only
to Permitted Prior Liens and other matters approved by Agent, each
such policy to be in such form and containing such endorsements as
may be required by Agent.
(B) PREMIUMS. Agent shall have received evidence that all
premiums with respect to such title policies have been paid by
Borrowers.
(C) OTHER INSURANCE. Prior to the Closing Date, Borrowers
shall have delivered to Agent evidence satisfactory to Agent (i)
of flood insurance, in form and substance satisfactory to Agent,
with respect to each parcel of Real Estate, other than a parcel as
to which Borrowers have supplied to Agent evidence that such
parcel is not in a flood hazard area, (ii) that all insurance
coverage required pursuant to Section 6.6 is in full force and
effect and all premiums then due thereon have been paid in full
and (iii) an original or certified copy of each policy of
insurance.
4.1.15 PAYMENT OF AMENDMENT FEE AND OTHER FEES. Borrowers shall
have paid the Amendment Fee and all fees and expenses described in
subsection 12.1.1 incurred in connection with the transactions
contemplated by this Loan Agreement.
4.2 TELE-MEDIA MERGER. The Borrowers shall satisfy each of the
following conditions on or before July 18, 1997 in a manner satisfactory to
Agent:
4.2.1 CONSUMMATION OF TELE-MEDIA MERGER. Agent shall have
received (i) evidence of the consummation of the Tele-Media Merger and
the acquisition by CBC as a result thereof of good and marketable title
to all of the Tele-Media Property, free and clear of all Liens and
Indebtedness, except Assumed Obligations (as defined in the Tele-Media
Acquisition Instruments) and (ii) certified copies of the Tele-Media
Merger Instruments.
4.2.2 DELIVERY OF DOCUMENTS. The following shall have been
delivered to Agent, each duly authorized and executed:
(a) a duly executed Mortgage on each parcel of
Tele-Media Real Estate; and
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(b) any amendments to the Loan Instruments required by
Agent to reflect the effect of the Tele-Media Merger.
4.2.3 OPINIONS OF COUNSEL. Agent shall have received such
opinions of counsel for Borrowers, in such form and covering such
matters as Agent may reasonably require, relating to the Tele-Media
Merger and the Liens granted by CBC on the Tele-Media Property, in each
case addressed to Agent for the benefit of Lenders.
4.2.4 SECURITY INTERESTS. All filings of UCC financing
statements, all recordings of the Mortgages and all other filings and
actions necessary to perfect and maintain the Security Interests
granted to Agent on the Tele-Media Property as first, valid and
perfected liens, subject only to Permitted Prior Liens, shall have been
filed or taken, and Agent shall have received such Uniform Commercial
Code and other lien searches as it deems necessary to confirm the
foregoing.
4.2.5 INSURANCE. Borrowers shall have delivered to Agent such
title and other insurance and such evidence with respect to each parcel
of Tele-Media Real Estate as is required pursuant to subsection 4.1.14
with respect to the Real Estate owned by CBC at the time of Closing.
4.3. ACQUISITIONS. The right of any Borrower to make an
Acquisition (other than the Tele-Media Acquisition), whether or not the
proceeds of an Additional Loan are used to consummate such Acquisition, shall
be subject to the satisfaction of all of the following conditions in a manner
satisfactory to the Required Lenders:
4.3.1 CONSUMMATION OF ACQUISITIONS. Prior to or concurrently with
each Acquisition Closing, Agent shall have received evidence that (i)
such Acquisition is in accordance with the terms of the applicable
Acquisition Instruments, (ii) if such Acquisition is an Asset
Acquisition, CBC will acquire concurrently with the Acquisition Closing
good and marketable title to all of the Station Assets, or Related
Business Assets which are being purchased pursuant to such Acquisition
Instruments, except the applicable FCC Licenses which shall be
transferred to CLI simultaneously with the Acquisition Closing, free
and clear of all Liens and Indebtedness except Permitted Liens and
Indebtedness which CBC has agreed to assume or take subject to pursuant
to such Acquisition Instruments, subject to the limitations set forth
in Sections 7.1, 7.2 and 7.4, (iii) if such Acquisition is an Equity
Acquisition, (A) the Property owned by the Person which owns the
capital stock or equity interests which are the subject of such
Acquisition shall be free and clear of all Liens and Indebtedness,
except such Liens and Indebtedness as CBC has agreed to assume or take
subject to pursuant to such Acquisition Instruments, subject to the
limitations set forth in Sections 7.1, 7.2 and 7.4 (B) the Required
Lenders shall be reasonably satisfied that adequate provision has been
made to protect CBC against the assumption of material undisclosed
liabilities, (C) simultaneously with the Acquisition Closing such
Person is merged into CBC with CBC being the surviving entity (an
"Acquisition Merger") and (D) simultaneously with the consummation of
such
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Acquisition the applicable FCC Licenses shall be transferred to CLI
and (iv) any consent, authorization or approval which is required from
any Governmental Body or other Person as a condition to the
consummation of such Acquisition, the failure to obtain which would
prevent the applicable Borrower from operating the Station or Related
Business which is the subject of such Acquisition, has been obtained.
4.3.2 DELIVERY OF DOCUMENTS. The following shall have been
delivered to Agent, each duly authorized and executed where applicable:
(a) the Acquisition Loan Instruments;
(b) such certificates of incumbency, good-standing
and corporate resolutions as Agent may reasonably require in
connection with such Acquisition;
(c) certified or executed original copies of each of the
following, the terms and conditions of all of which shall be
reasonably satisfactory to Agent:
(i) the applicable Acquisition Instruments; and
(ii) the Leases assumed or entered into by CBC in
connection with such Acquisition; and
(d) such other instruments, documents, certificates,
consents, waivers and opinions as Agent may reasonably require.
4.3.3 FINANCIAL STATEMENTS, REPORTS AND PROJECTIONS. Agent shall
have received such financial statements, reports and projections with
respect to the operation of the business which is the subject of the
Acquisition as Agent may reasonably require.
4.3.4 COMPLIANCE WITH APPLICABLE RATIO. After giving effect to
such Acquisition, the Adjusted Leverage Ratio shall not exceed the
Applicable Ratio as calculated as of the most recent month preceding
the Acquisition Closing Date for which Borrowers have delivered to
Lenders the financial statements and other information reasonably
necessary to enable Lenders to make such calculation, provided that
such delivery shall occur not less than 15 days prior to such date of
closing.
4.3.5 OPINIONS OF COUNSEL. Agent shall have received such
opinions of counsel as Agent may reasonably require in connection with
such Acquisition and the Liens to be granted to Agent upon the Property
acquired in connection therewith.
4.3.6 FCC LICENSES. Agent shall have received (i) certified
copies of all FCC licenses issued with respect to the operation of each
Station to be acquired in connection with such Acquisition or the
Acquisition Merger, (ii) evidence that upon the Acquisition Closing CLI
will be the licensee of all such FCC Licenses and that the approval by
the
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FCC of the transfer of such Licenses to CLI has become final and
non-appealable, (iii) evidence that CBC is authorized to make use of
such FCC licenses pursuant to the Amended and Restated Use Agreement
and any amendment to such agreement necessary to effect the foregoing,
(iv) such FCC Licenses are all licenses which are necessary to enable
CBC to conduct its Broadcasting Business with respect to each such
Station, (v) such FCC Licenses are in full force and effect as of the
Acquisition Closing Date, and (vi) no event has occurred that could
result in the termination, revocation or non-renewal of any such
license.
4.3.7 SECURITY INTEREST. Agent shall have received evidence that
it has or will acquire upon the Acquisition Closing Date a perfected
first lien on all of the Property which is the subject of such
Acquisition or the Acquisition Merger, as applicable, subject only to
Permitted Prior Liens.
4.3.8 ENVIRONMENTAL AUDIT. Agent shall have received an
Environmental Audit with respect to any real estate which is being
acquired by CBC pursuant to such Acquisition or Acquisition Merger and,
at the request of Agent, any real estate which is the subject of a
Lease which is being assumed or entered into by CBC in connection with
such Acquisition or Acquisition Merger.
4.3.9 INSURANCE; SURVEY. Borrowers shall deliver to Agent (i)
such title and other insurance with respect to each parcel of real
estate being acquired in connection with such Acquisition as is
required pursuant to subsection 4.1.14 with respect to the Real Estate
owned by CBC at the time of the Closing and (ii) a recent survey of
each such parcel in sufficient detail to permit the elimination of
survey exceptions to each title policy.
4.3.10 ENGINEER'S CERTIFICATE. There shall have been delivered to
Agent a Certificate of an Engineer for each Station being acquired in
connection with such Acquisition or Acquisition Merger.
4.3.11 PAYMENT OF FEES. Borrowers shall have paid all fees and
expenses described in subsection 12.1.1 incurred in connection with
such Acquisition and any Additional Loan made in connection therewith.
4.3.12 REPRESENTATIONS AND WARRANTIES. On each Acquisition
Closing Date the representations and warranties of each Obligor set
forth in the Loan Instruments to which such Obligor is a party shall be
true and correct when made and at and as of the time of the Acquisition
Closing, except to the extent that such representations and warranties
expressly relate to an earlier date.
4.3.13 PERFORMANCE; NO DEFAULT. Each Obligor shall have
performed and complied with all agreements and conditions contained in
the Loan Instruments to be performed by or complied with by such Person
prior to or at the applicable Acquisition
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Closing, and no Event of Default or Incipient Default shall exist
after giving effect to such Acquisition and, if applicable, the
related Acquisition Merger.
4.4 LANDLORD'S CONSENT. Except to the extent previously
delivered to Agent, Borrowers shall use their best efforts to obtain and
deliver to Agent within 60 days after the Closing Date a Landlords' Consent
with respect to each Lease and each Tele-Media Lease.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrowers represent and warrant to Lenders as follows:
5.1 CORPORATE EXISTENCE AND POWER. Each Borrower is a
corporation duly formed, validly existing and in good standing under the laws
of the State of Nevada, has all requisite power and authority to own its
Property and to carry on its business as now conducted and as proposed to be
conducted following the Closing Date, and is in good standing and authorized to
do business in each jurisdiction in which the failure so to qualify would have
a Material Adverse Effect, including in any event each jurisdiction in which
any Station or LMA Station of such Borrower is operated.
5.2 CORPORATE AUTHORITY. Each Borrower has full power and
authority to enter into, execute, deliver and carry out the terms of the
Instruments to which it is a party and to incur the obligations provided for
therein, all of which have been duly authorized by all proper and necessary
action and are not prohibited by the organizational instruments of such
Borrower.
5.3 CAPITAL STOCK, SENIOR SUBORDINATED NOTES AND RELATED MATTERS.
5.3.1 CAPITALIZATION OF BORROWERS. There is set forth in EXHIBIT
5.3.1 a complete description of the capitalization of each Borrower,
after giving effect to the issuance of the Exchangeable Preferred
Stock. All of the capital stock of each Borrower is validly issued,
fully paid and non-assessable, and all of such capital stock and the
Senior Subordinated Notes have been issued and sold in compliance with
all applicable federal and state laws, rules and regulations,
including, without limitation, all so-called "Blue-Sky" laws. All of
the CBC Common Stock is owned beneficially and of record by Guarantor
and all of the CLI Capital Stock is owned beneficially and of record by
CBC, in each case free and clear of all Liens except the Security
Interests.
5.3.2 RESTRICTIONS. Except for the applicable Instruments,
neither Borrower (i) is a party to or has knowledge of any agreements
restricting the transfer of its capital stock, (ii) has issued any
rights which can be convertible into or exchangeable or exercisable for
any of its capital stock or debt securities, or any rights to subscribe
for or to purchase, or any options for the purchase of, or any
agreements providing for the
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issuance (contingent or otherwise) of, or any calls, commitments or
claims of any character relating to, any of its capital stock or any
securities convertible into or exchangeable or exercisable for any of
its capital stock or debt securities and (iii) is subject to any
obligation (contingent or otherwise) to repurchase or otherwise
acquire or retire any of its capital stock, convertible rights or
options or debt securities. Except as provided in the applicable
Instruments, no Borrower is required to file, and no Borrower has
filed, pursuant to Section 12 of the Securities Exchange Act of 1934,
as amended, a registration statement relating to any class of debt or
equity securities.
5.4 BINDING AGREEMENTS. This Loan Agreement and the other Loan
Instruments, when executed and delivered, will constitute the valid and legally
binding obligations of each Obligor to the extent such Obligor is a party
thereto, enforceable against each Obligor in accordance with their respective
terms, except as such enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect affecting the enforcement of creditors' rights generally
and (ii) equitable principles (whether or not any action to enforce such
document is brought at law or in equity).
5.5 BUSINESS, PROPERTY AND LICENSES OF BORROWER.
5.5.1 BUSINESS AND PROPERTY. CBC is, or upon the Closing will be,
the owner of all Property and will have the right, pursuant to the
Amended and Restated Use Agreement, to make use of all FCC Licenses
necessary to conduct the operations of each of CBC's Stations and to
perform its obligations pursuant to the LMA Agreements. CBC does not
engage or propose to engage in any business or activity other than the
Broadcasting Business or Related Businesses and CLI does not engage or
propose to engage in any business or activity other than being the
licensee under FCC Licenses.
5.5.2 FCC LICENSES. There is set forth in EXHIBIT 5.5.2 a
description of all FCC Licenses which have been issued or assigned to
CLI and which are being used by CBC. All of such FCC Licenses are in
full force and effect and have been duly issued in the name of, or
validly assigned to CLI and no default or breach exists thereunder.
5.5.3 LMA AGREEMENTS. The LMA Agreements are in full force and
effect and no default or breach exists under any such agreement. The
approval or consent has been obtained from all Governmental Bodies,
including, without limitation, the FCC, and all other Persons whose
approval or consent is required to enable the applicable Borrower to
perform its obligations and receive the benefits of the LMA Agreements.
5.5.4 OPERATING AGREEMENTS. All Operating Agreements are in full
force and effect and no event has occurred which could result in the
cancellation or termination of any such Operating Agreement which, if
cancelled or terminated, would have a Material Adverse Effect, or the
imposition thereunder of any liability upon any Borrower which could
reasonably be expected to have a Material Adverse Effect.
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5.5.5 BUSINESS LOCATIONS. There is set forth in EXHIBIT 5.5.5 the
location of each Borrower's chief executive office, the locations of
all of such Borrower's Property, the places where such Borrower's books
and records are kept, and the locations of all transmitters, antennae,
studios and offices used in the operation of each of the CBC Stations
or Related Businesses.
5.5.6 REAL PROPERTY; LEASES. There is set forth in EXHIBIT 1X a
complete and accurate description of the Real Estate owned by CBC.
There is set forth in EXHIBIT 1S a list of all Leases under which CBC
is lessee. Each Lease is in full force and effect, there has been no
material default in the performance of any of its terms or conditions
by CBC, or, to the best knowledge of CBC, any other party thereto, and
no claims of default have been asserted with respect thereto. The
present and contemplated use of the Real Estate and the Leasehold
Property is in compliance with all applicable zoning ordinances and
regulations and other laws and regulations, except for any
noncompliance which would not have a Material Adverse Effect.
5.5.7 OPERATION AND MAINTENANCE OF EQUIPMENT. To the best of
Borrowers' knowledge, no Person owning or operating any equipment
necessary for the operation of any of Borrowers' Stations or any LMA
Station has used, operated or maintained the same in a manner which now
or hereafter could result in the cancellation or termination of the
right of CBC to use or make use of the same or which could result in
any material liability of CBC for damages in connection therewith. All
of the equipment and other tangible personal property which is now
owned or which will be owned by CBC is or will be, upon the acquisition
thereof, in good operating condition and repair (subject to normal wear
and tear considering the age thereof) and has while owned or operated
by CBC, been used, operated and maintained in substantial compliance
with all applicable laws, rules and regulations.
5.6 TITLE TO PROPERTY; LIENS. CBC has (i) good and marketable
title to all of its Property, except the portion thereof consisting of a
leasehold estate and (ii) a valid leasehold estate in each portion of its
Property which consists of a leasehold estate, except for any defects in title
which would not have a Material Adverse Effect. Upon the proper filing with the
appropriate Governmental Bodies of the Mortgages and appropriate UCC Financing
Statements, the applicable Loan Instruments will create valid and perfected
first Liens on the Property described therein, subject only to Permitted Prior
Liens.
5.7 PROJECTIONS AND FINANCIAL STATEMENTS.
5.7.1 FINANCIAL STATEMENTS. The financial statements and reports
of CBC and, for the period beginning January 1, 1997, DAC described in
EXHIBIT 5.7.1 present fairly in all material respects the results of
operations of such Person for the periods covered thereby and the
financial condition of each such Person as of the dates indicated
therein. Borrowers have no reason to believe that the financial
statements described in EXHIBIT 5.7.1 with respect to Snider
Corporation, Snider Broadcasting Corporation and
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Subsidiary, CDB Broadcasting Corporation, the Tele-Media Stations and
the DAC Stations prior to January 1, 1997, do not present fairly in
all material respects the results of operations of such Stations for
the periods covered thereby and the financial condition of such
Stations as of the dates indicated therein. All of the foregoing
financial statements pertaining to the Borrowers and, to the best
knowledge of Borrowers, the financial statements with respect to the
Tele-Media Stations, have been prepared in conformity with GAAP,
except in the case of the unaudited statements for the absence of
footnotes and normal year-end adjustments. Since May 31, 1997, there
has been no change which has had a Material Adverse Effect as compared
with the state of affairs on such date. Borrowers also have delivered
to Agent a pro-forma balance sheet as of the Closing Date. Such
pro-forma balance sheet, which assumes the consummation of the
transactions contemplated by the Instruments, presents fairly in all
material respects the anticipated financial condition of Borrowers as
of the Closing Date.
5.7.2 PROJECTIONS. The projections described in EXHIBIT 5.7.2 of
the future operations of CBC represent the best estimates of Borrowers
as of the Closing Date of CBC's future financial performance.
5.8 LITIGATION. There is set forth in EXHIBIT 5.8 a
description of all actions and suits, arbitration proceedings and claims
pending or, to the best knowledge of Borrowers, threatened against any Borrower
or maintained by either Borrower at law or in equity or before any Governmental
Body. None of the matters set forth in such EXHIBIT 5.8, if adversely
determined, could reasonably be expected to have a Material Adverse Effect.
5.9 DEFAULTS IN OTHER AGREEMENTS; CONSENTS; CONFLICTING
AGREEMENTS. No Borrower is in default under any agreement to which such
Borrower is a party or by which it or any of its Property is bound, the effect
of which default could have a Material Adverse Effect. No authorization,
consent, approval or other action by, and no notice to or filing with, any
Governmental Body or any other Person which has not already been obtained,
taken or filed, as applicable, is required (i) for the due execution, delivery
or performance by any Borrower of any of the Instruments to which such Borrower
is a party, (ii) the consummation of the Tele-Media Acquisition or (iii) as a
condition to the validity or enforceability of any of the Instruments to which
any Borrower is a party or any of the transactions contemplated thereby or the
priority of the Security Interests, except for (A) certain filings to establish
and perfect the Security Interests and (B) filing of certain of the Loan
Instruments with the FCC. No provision of any material mortgage, indenture,
contract, agreement, statute, rule, regulation, judgment, decree or order
binding on either Borrower or affecting the Property of either Borrower
conflicts with, or requires any consent which has not already been obtained
under, or would in any way prevent the execution, delivery or performance of
the terms of any of the Instruments or affect the validity or priority of the
Security Interests. The execution, delivery or performance of the terms of the
Instruments will not constitute a default under, or result in the creation or
imposition of, or obligation to create, any Lien upon the Property of either
Borrower pursuant to the terms of any such material mortgage, indenture,
contract or agreement.
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5.10 TAXES. Borrowers have filed all tax returns required to be
filed, and have paid, or made adequate provision for the payment of, all taxes
shown to be due and payable on such returns or in any assessments made against
either Borrower, and no tax liens have been filed and, to the best knowledge of
Borrowers, no claims are being asserted in respect of such taxes which are
required by GAAP to be reflected in the financial statements of either Borrower
and are not so reflected therein. The charges, accruals and reserves on the
books of each Borrower with respect to all federal, state, local and other
taxes are considered by the management of Borrowers to be adequate, and
Borrowers do not know of any unpaid assessment which is or might be due and
payable against either Borrower or any of its Property, except such assessments
as are being contested in good faith and by appropriate proceedings diligently
conducted, and for which adequate reserves have been set aside in accordance
with GAAP. None of the tax returns of any Obligor are under any audit, which
could result in any determination of any tax liability which could reasonably
be expected to have a Material Adverse Effect.
5.11 COMPLIANCE WITH APPLICABLE LAWS. Neither Borrower is in
default in respect of any judgment, order, writ, injunction, decree or decision
of any Governmental Body, which default could reasonably be expected to have a
Material Adverse Effect. Each Borrower is in compliance in all material
respects with all applicable statutes and regulations, including, without
limitation, the Communications Act, all Environmental Laws, ERISA, ADA and all
laws and regulations relating to unfair labor practices, equal employment
opportunity and employee safety, of all Governmental Bodies, a violation of
which would have a Material Adverse Effect. No material condemnation, eminent
domain or expropriation has been commenced or, to the best knowledge of
Borrowers, threatened against the Property which Borrowers will own upon the
Closing.
5.12 PATENTS, TRADEMARKS AND FRANCHISES. CBC owns, possesses or
has a right to use all patents, trademarks, service marks, tradenames,
copyrights, franchises and rights with respect thereto, including the patents,
trademarks, service marks, tradenames, copyrights, franchises and rights
described in EXHIBIT 5.12, necessary for the conduct of its Broadcasting
Business, without any known conflict with the rights of others and, in each
case, free of any Liens, except for any defects in title, conflicts with rights
of others and Liens which would not have a Material Adverse Effect.
5.13 FCC MATTERS. Borrowers (i) have duly and timely filed all
reports and other filings which are required to be filed under the
Communications Act or any other applicable law, rule or regulation of any
Governmental Body, the non-filing of which would have a Material Adverse
Effect, and (ii) are in compliance with all such laws, rules and regulations,
the noncompliance with which could reasonably be expected to have a Material
Adverse Effect. All information provided by or on behalf of either Borrower in
any material filing with the FCC was, at the time of filing, true, complete and
correct in all material respects when made, and the FCC has been notified of
any substantial or significant changes in such information as may be required
in accordance with applicable laws, rules and regulations.
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5.14 ENVIRONMENTAL MATTERS. Except as set forth in EXHIBIT
5.14, CBC is in compliance with all applicable Environmental Laws, and no
portion of any of the Real Estate or any of the Leasehold Property subject to
Leases has been used as a land fill. None of the items set forth in EXHIBIT
5.14 could reasonably be expected to have a Material Adverse Effect. CBC shall
not cause or permit to be, and, to the best of CBC's knowledge, there currently
are not, any known Hazardous Materials generated, manufactured, released,
stored, buried or deposited over, beneath, in or on (or used in the
construction and/or renovation of), transported to or from, the Real Estate or
Leasehold Property in violation of applicable Environmental Laws.
5.15 APPLICATION OF CERTAIN LAWS AND REGULATIONS. No Obligor or
any Affiliate of any Obligor is:
5.15.1 INVESTMENT COMPANY ACT. An "investment company," or a
company "controlled" by an "investment company," within the meaning of
the Investment Company Act of 1940, as amended.
5.15.2 HOLDING COMPANY ACT. A "holding company," or a "subsidiary
company" of a "holding company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company," as such
terms are defined in the Public Utility Holding Company Act of 1935, as
amended.
5.15.3 FOREIGN OR ENEMY STATUS. (i) An "enemy" or an "ally of an
enemy" within the meaning of Section 2 of the Trading with the Enemy
Act, (ii) a "national" of a foreign country designated in Executive
Order No. 8389, as amended, or of any "designated enemy country" as
defined in Executive Order No. 9095, as amended, of the President of
the United States of America, in each case within the meaning of such
Executive Orders, as amended, or of any regulation issued thereunder,
(iii) a "national of any designated foreign country" within the meaning
of the Foreign Assets Control Regulations or of the Cuban Assets
Control Regulations of the United States of America (Code of Federal
Regulations, Title 31, Chapter V, Part 515, Subpart B, as amended), or
(iv) an alien or a representative of any alien or foreign government
within the meaning of Section 310 of Title 47 of the United States
Code.
5.15.4 REGULATIONS AS TO BORROWING. Subject to any statute or
regulation which regulates the incurrence of any Indebtedness for
Borrowed Money, including, without limitation, statutes or regulations
relative to common or interstate carriers or to the sale of
electricity, gas, steam, water, telephone, telegraph or other public
utility services.
5.16 MARGIN REGULATIONS. None of the transactions contemplated
by this Loan Agreement or any of the other Loan Instruments, including the use
of the proceeds of the Loans, will violate or result in a violation of Section
7 of the Securities Exchange Act of 1934, as amended, or any regulations issued
pursuant thereto, including, without limitation, Regulations
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G, T, U and X, and Borrower does not own or intend to carry or purchase any
"margin security" within the meaning of such Regulation U or G.
5.17 OTHER INDEBTEDNESS. Upon the Closing there will be no
Indebtedness for Borrowed Money, except (i) Borrowers' Obligations, (ii)
Permitted Senior Indebtedness, (iii) Senior Subordinated Indebtedness and (iv)
Seller Debt.
5.18 NO MISREPRESENTATION. Neither this Loan Agreement nor any
other Loan Instrument, certificate, information or report furnished or to be
furnished by or on behalf of any Obligor to any Lender or Agent in connection
with any of the transactions contemplated hereby or thereby, contains or will
contain a misstatement of material fact, or omits or will omit to state a
material fact required to be stated in order to make the statements contained
herein or therein, taken as a whole, not misleading in the light of the
circumstances under which such statements were made. There is no fact, other
than information known to the public generally, known to or reasonably foreseen
by either Borrower after diligent inquiry, that would be expected to have a
Material Adverse Effect that has not expressly been disclosed to Lenders in
writing.
5.19 EMPLOYEE BENEFIT PLANS.
5.19.1 NO OTHER PLANS. No Obligor or any ERISA Affiliate
maintains or contributes to, or has any obligation under, any Employee
Benefit Plan other than those identified on EXHIBIT 5.19.1 Borrowers
have provided Agent accurate and complete copies of all contracts,
agreements and documents described on EXHIBIT 5.19.1.
5.19.2 ERISA AND CODE COMPLIANCE AND LIABILITY. Each Obligor and
each ERISA Affiliate is in compliance with all applicable provisions of
ERISA and the regulations and published interpretations thereunder with
respect to all Employee Benefit Plans except where failure to comply
would not result in a material liability to any Obligor and except for
any required amendments for which the remedial amendment period as
defined in Section 401(b) of the Code has not yet expired. Each
Employee Benefit Plan that is intended to be qualified under Section
401(a) of the Code has been determined by the Internal Revenue Service
to be so qualified, and each trust related to such plan has been
determined to be exempt under Section 401(a) of the Code. No material
liability has been incurred by any Obligor or ERISA Affiliate which
remains unsatisfied for any taxes or penalties with respect to any
Employee Benefit Plan or any Multiemployer Plan.
5.19.3 FUNDING. No Pension Plan has been terminated, nor has any
accumulated funding deficiency (as defined in Section 412 of the Code)
been insured (without regard to any waiver granted under Section 412 of
the Code), nor has any funding waiver from the IRS been received or
requested with respect to any Pension Plan, nor has any Obligor or any
ERISA Affiliate failed to make any contributions or to pay any amounts
due and owing as required by Section 412 of the Code, Section 302 of
ERISA or the terms of any Pension Plan prior to the due dates of such
contributions
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under Section 412 of the Code or Section 302 of ERISA, nor has there
been any event requiring any disclosure under Section 4041(c)(3)(C),
4063(a) or 4068 of ERISA with respect to any Pension Plan.
5.19.4 PROHIBITED TRANSACTIONS AND PAYMENTS. No Obligor nor any
ERISA Affiliate has: (i) engaged in a nonexempt "prohibited
transaction" as such term is defined in Section 406 of ERISA or Section
4975 of the Code; (ii) incurred any liability to the PBGC which remains
outstanding other than the payment of premiums and there are no premium
payments which are due and unpaid; (iii) failed to make a required
contribution or payment to a Multiemployer Plan; or (iv) failed to make
a required installment or other required payment under Section 412 of
the Code.
5.19.5 NO TERMINATION EVENT. No Termination Event has occurred
or is reasonably expected to occur.
5.19.6 ERISA LITIGATION. No material proceeding, claim, lawsuit
and/or investigation is existing or, to the best knowledge of
Borrowers, threatened concerning or involving any (i) employee welfare
benefit plan (as defined in Section 3(1) of ERISA) currently maintained
or contributed to by any Obligor, or any ERISA Affiliate, (ii) Pension
Plan or (iii) Multiemployer Plan.
5.20 EMPLOYEE MATTERS.
5.20.1 COLLECTIVE BARGAINING AGREEMENTS; GRIEVANCES. (i) None of
the employees of CBC is subject to any collective bargaining agreement,
(ii) no petition for certification or union election is pending with
respect to the employees of CBC and no union or collective bargaining
unit has sought such certification or recognition with respect to the
employees of CBC and (iii) there are no strikes, slowdowns, work
stoppages, unfair labor practice complaints, grievances, arbitration
proceedings or controversies pending or, to the best knowledge of
Borrowers, threatened against CBC by any of its employees, other than
employee grievances or controversies arising in the ordinary course of
business that would not in the aggregate be expected to have a Material
Adverse Effect.
5.20.2 CLAIMS RELATING TO EMPLOYMENT. Except as set forth on
EXHIBIT 5.20.2, neither CBC nor, to Borrowers' best knowledge, any
shareholder or employee of any CBC is subject to any employment
agreement or non-competition agreement with any former employer or any
other Person which agreement would have a Material Adverse Effect due
to (i) any information which CBC would be prohibited from using under
the terms of such agreement or (ii) any legal considerations relating
to unfair competition, trade secrets or proprietary information.
5.21 BURDENSOME OBLIGATIONS. After giving effect to the transactions
contemplated by the Instruments, (i) neither Borrower (A) will be a party to or
be bound by any franchise,
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agreement, deed, lease or other instrument, or be subject to any restriction,
which is so unusual or burdensome so as to cause, in the foreseeable future, a
Material Adverse Effect and (B) intends to incur, or believes that it will
incur, debts beyond its ability to pay such debts as they become due, and (ii)
Borrowers (A) own and will own Property, the fair saleable value of which is
(I) greater than the total amount of their liabilities (including contingent
liabilities) and (II) greater than the amount that will be required to pay the
probable liabilities of its then existing debts as they become absolute and
matured, and (B) have and will have capital that is not unreasonably small in
relation to their businesses as presently conducted and as proposed to be
conducted. Borrowers do not presently anticipate that future expenditures
needed to meet the provisions of federal or state statutes, orders, rules or
regulations will be so burdensome so as to have a Material Adverse Effect.
5.22 INSURANCE. No notice of cancellation has been received with
respect to any insurance policies required pursuant to Section 4.1.15 and
Borrowers are in material compliance with all conditions contained in such
policies.
5.23 REPRESENTATION AS TO ACQUISITION INSTRUMENTS. To the best
knowledge of Borrowers, the representations and warranties made by the seller
pursuant to the Tele-Media Acquisition Instruments are true and correct as of
the Closing Date and no defaults exist thereunder.
ARTICLE VI
AFFIRMATIVE COVENANTS
Until all of Borrowers' Obligations are paid and performed in full and
all of the Commitments have been terminated, except as provided in Section
6.11, each Borrower agrees that it will:
6.1 LEGAL EXISTENCE; GOOD STANDING. Maintain its existence and
its good standing in the jurisdiction of its formation and maintain its
qualification in each jurisdiction in which the failure so to qualify would
have a Material Adverse Effect, and in any event in each jurisdiction in which
any one Station or Related Business is owned or operated by CBC.
6.2 INSPECTION. Permit representatives of each Lender to (i)
visit its offices, (ii) examine its books and records and Accountants' reports
relating thereto, (iii) make copies or extracts therefrom, (iv) discuss its
affairs with its employees, (v) examine and inspect its Property and (vi) meet
and discuss its affairs with the Accountants, and such Accountants, as a
condition to their retention by such Borrower, are hereby irrevocably
authorized by such Borrower to fully discuss and disclose all such affairs with
each Lender. The representatives of each Lender shall conduct the activities
described in this Section 6.2 at reasonable times and upon reasonable notice,
provided, however, if an Event of Default or Incipient Default exists, such
activities may be conducted at any time without notice.
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6.3 FINANCIAL STATEMENTS AND OTHER INFORMATION. Maintain a standard
system of accounting in accordance with GAAP and furnish to each Lender:
6.3.1 MONTHLY STATEMENTS. As soon as available and in any event
within 30 days after the close of each month:
(a) the consolidated balance sheet of Obligors and
the consolidating balance sheet of each Borrower as of the
end of such month,
(b) the consolidated statements of operations of Obligors,
the consolidated statements of Operating Cash Flow of Borrowers,
the statement of Excess Cash Flow, and the consolidating
statements of operations and Cash Flow for each Borrower for such
month and for the period from the beginning of the then current
year to the end of such month, setting forth in each case in
comparative form the corresponding figures for the corresponding
period in the preceding year,
(c) a statement of the Adjusted Operating Cash Flow for
such month and for the period from the beginning of the then
current year to the end of such month, and
(d) a statement of the Market Cash Flow for each Broadcast
Market for such month and for the period from the beginning of the
then current year to the end of such month, and showing a
comparison with the budget for such period,
all in reasonable detail, containing such information as any Lender
reasonably may require, and certified by the Chief Financial Officer
as complete and correct, subject to normal year-end adjustments.
6.3.2 QUARTERLY STATEMENTS. As soon as available and in
any event within 45 days after the close of each quarter of each year:
(a) the consolidated balance sheet of Obligors
and the consolidating balance sheet of each Borrower as of
the end of such quarter,
(b) the consolidated statements of operations
of Obligors, the consolidated statements of Operating Cash
Flow of Borrowers, the statement of Excess Cash Flow, and
the consolidating statements of operations and Operating
Cash Flow for each Borrower for such quarter and for the
period from the beginning of the then current year to the
end of such quarter, setting forth in each case in
comparative form the corresponding figures for the
corresponding period in the preceding year, and showing a
comparison with the budget for such period,
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(c) a statement of the Adjusted Operating Cash
Flow of Borrowers for such quarter and for the immediately
preceding three quarters, and
(d) a statement of the Market Cash Flow for
each Broadcast Market for such quarter and for the period
from the beginning of the then current year to the end of
such quarter,
all in reasonable detail, containing such information as any Lender
reasonably may require, and certified by the Chief Financial Officer
as complete and correct, subject to normal year-end adjustments.
6.3.3 ANNUAL STATEMENTS. As soon as available and in any
event within 120 days after the close of each year:
(a) the consolidated balance sheet of
Borrowers as of the end of such year, the statements of
operations, cash flows, stockholders' equity of Borrowers,
the consolidating balance sheet of each Borrower as of the
end of such year, the consolidating statements of
operations, cash flows and stockholders' equity for each
Borrower for such year (collectively, the "Basic Financial
Statements"), the statements of Excess Cash Flow and of the
consolidated and consolidating Operating Cash Flow for
Borrowers for such year, setting forth in each case in
comparative form the corresponding figures for the preceding
year,
(b) a statement of the Market Cash Flow for
each Broadcast Market for such year, in each case certified
by the Chief Financial Officer as complete and correct, and
showing a comparison with the budget for such period,
(c) an opinion of the Accountants which shall
accompany the Basic Financial Statements, which opinion
shall be unqualified as to going concern and scope of audit,
stating that (i) the examination by the Accountants in
connection with such Basic Financial Statements has been
made in accordance with generally accepted auditing
standards, (ii) such Basic Financial Statements have been
prepared in conformity with GAAP and in a manner consistent
with prior periods, and (iii) such Basic Financial
Statements fairly present in all material respects the
financial position and results of operations of the
Borrowers, and
(d) a letter from the Accountants stating
that the statements of Operating Cash Flow, Market Cash Flow
and Excess Cash Flow were computed in accordance with the
requirements of this Loan Agreement.
6.3.4 OFFICER'S CERTIFICATES. The financial statements
described in subsections 6.3.1, 6.3.2 and 6.3.3 shall be accompanied
by a Compliance Certificate signed by the Chief Financial Officer.
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6.3.5 ACCOUNTANTS' CERTIFICATE. Simultaneously with
the delivery of the certified Basic Financial Statements required by
subsection 6.3.3, copies of a certificate of the Accountants stating
that (i) they have checked the computations delivered by Borrowers in
compliance with subsection 6.3.3, and (ii) in making the examination
necessary for their audit of the Basic Financial Statements of
Borrowers for such year nothing came to their attention of a financial
or accounting nature that caused them to believe that (A) either
Borrower was not in compliance with the terms, covenants, provisions
or conditions of any of the Loan Instruments or (B) there shall have
occurred any condition or event which would constitute an Event of
Default, or, if so, specifying in such certificate all such instances
of non-compliance and the nature and status thereof.
6.3.6 AUDIT REPORTS. Promptly upon receipt thereof, a
copy of each report, other than the reports referred to in subsection
6.3.3, including any so-called "Management Letter" or similar report,
submitted to Obligors by the Accountants in connection with any
annual, interim or special audit made by the Accountants of the books
of any Obligor.
6.3.7 BUSINESS PLANS. Not later than 30 days
before the end of each year, a business plan for the following year
setting forth in reasonable detail the projected operations budget of
each Broadcast Market for such year and such other information as any
Lender may reasonably request, for such following year.
6.3.8 NOTICE OF DEFAULTS; LOSS. Prompt written notice
if: (i) any Indebtedness for Borrowed Money of either Borrower is
declared or shall become due and payable prior to its declared or
stated maturity, or called and not paid when due, (ii) an event has
occurred that enables the holder of any note, or other evidence of
such Indebtedness for Borrowed Money of either Borrower to declare
such Indebtedness for Borrowed Money due and payable prior to its
stated maturity, (iii) there shall occur and be continuing an
Incipient Default or Event of Default, accompanied by a statement of
the Chief Financial Officer setting forth what action Borrowers
propose to take in respect thereof, or (iv) any event shall occur
which could reasonably be expected to have a Material Adverse Effect,
including the amount or the estimated amount of any loss or
depreciation or adverse effect.
6.3.9 NOTICE OF SUITS, ADVERSE EVENTS. Prompt written
notice of: (i) any citation, summons, subpoena, order to show cause or
other order naming either Borrower a party to any proceeding before
any Governmental Body which could reasonably be expected to have a
Material Adverse Effect and include with such notice a copy of such
citation, summons, subpoena, order to show cause or other order, (ii)
any lapse or other termination of any license, permit, franchise,
agreement or other authorization issued to either Borrower by any
Governmental Body or any other Person, the result of which could
reasonably be expected to have a Material Adverse Effect, (iii) any
refusal by any Governmental Body or any other Person to renew or
extend any such license, permit, franchise, agreement or other
authorization and (iv) any dispute between either Borrower
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and any Governmental Body or any other Person, which lapse,
termination, refusal or dispute referred to in clauses (ii) and (iii)
above or in this clause (iv) could reasonably be expected to have a
Material Adverse Effect.
6.3.10 REPORTS TO SHAREHOLDERS, CREDITORS AND
GOVERNMENTAL BODIES.
(a) Promptly upon becoming available, copies of all
financial statements, reports, notices and other statements sent
or made available generally by any Obligor to its shareholders, of
all regular and periodic reports and all registration statements
and prospectuses filed by any Obligor with any securities exchange
or with the SEC, and of all statements generally made available by
any Obligor or others concerning material developments in CBC's
Broadcasting Business.
(b) Promptly upon becoming available, copies of any
periodic or special reports filed by any Obligor with any
Governmental Body or Person, if such reports indicate any material
change in the business, operations, affairs or condition of such
Obligor, or if copies thereof are requested by any Lender, and
copies of any material notices and other communications from any
Governmental Body or Person which specifically relate to any
Obligor.
6.3.11 ERISA NOTICES AND REQUESTS.
(a) With reasonable promptness, and in any
event within 30 days after occurrence of any of the
following, Borrowers will give notice of and/or deliver to
Agent copies of: (i) the establishment of any new Employee
Benefit Plan, Pension Plan or Multiemployer Plan; (ii) the
commencement of contributions to any Employee Benefit Plan,
Pension Plan or Multiemployer Plan to which any Obligor or
any of its ERISA Affiliates was not previously contributing
or any increase in the benefits of any existing Employee
Benefit Plan, Pension Plan or Multi-employer Plan; (iii)
each funding waiver request filed with respect to any
Employee Benefit Plan and all communications received or
sent by any Obligor or any ERISA Affiliate with respect to
such request; and (iv) the failure of any Obligor or ERISA
Affiliate to make a required installment or payment under
Section 302 of ERISA or Section 412 of the Code by the due
date.
(b) Promptly and in any event within 10 days
of becoming aware of the occurrence of or forthcoming
occurrence of any (i) Termination Event or (ii) "prohibited
transaction", as such term is defined in Section 406 of
ERISA or Section 4975 of the Code, in connection with any
Pension Plan or any trust created thereunder, Borrowers will
deliver to Agent a notice specifying the nature thereof,
what action the applicable Obligor has taken, is taking or
proposes to take with respect thereto and, when known, any
action taken or
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threatened by the Internal Revenue Service, the Department
of Labor or the PBGC with respect thereto.
(c) With reasonable promptness but in any
event within 10 days after the occurrence of any of the
following, Borrowers will deliver to Agent copies of: (i)
any favorable or unfavorable determination letter from the
Internal Revenue Service regarding the qualification of an
Employee Benefit Plan under Section 401(a) of the Code; (ii)
all notices received by any Obligor or any ERISA Affiliate
of the PBGC's intent to terminate any Pension Plan or to
have a trustee appointed to administer any Pension Plan;
(iii) each Schedule B (Actuarial Information) to the annual
report (Form 5500 Series) filed by any Obligor or any ERISA
Affiliate with the Internal Revenue Service with respect to
each Pension Plan; and (iv) all notices received by any
Obligor or any ERISA Affiliate from a Multiemployer Plan
sponsor concerning the imposition or amount of withdrawal
liability pursuant to Section 4202 of ERISA. Borrowers will
notify Agent in writing within two Business Days of any
Obligor or any ERISA Affiliate that has filed or intends to
file a notice of intent to terminate any Pension Plan under
a distress termination within the meaning of Section 4041(c)
of ERISA.
6.3.12 RATING BOOKS. Promptly upon receipt thereof and
upon request therefor by any Lender, copies of all station rating
books to the extent permitted by applicable law and the agreements
with the publishers thereof.
6.3.13 OTHER INFORMATION.
(a) Immediate notice of any material change
in, or termination of, the employment of Wilson or the Chief
Financial Officer, any change in the location of any
Property of either Borrower which is material to or
necessary for the continued operation of CBC's Broadcasting
Business, including without limitation any change in the
location of any transmitting tower, any change in the name
of either Borrower and any sale or purchase of Property
outside the regular course of business of either Borrower
other than the sales described in Section 7.11(i).
(b) Promptly upon request therefor, such
other information and reports relating to the past, present
or future financial condition, operations, plans and
projections of Borrowers as any Lender may reasonably
request from time to time.
6.4 REPORTS TO GOVERNMENTAL BODIES AND OTHER PERSONS. Timely
file all material reports, applications, documents, instruments and information
required to be filed pursuant to all rules, regulations or requests of any
Governmental Body or other Person having jurisdiction over the operation of the
business of CBC, including, but not limited to, such of the Loan
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Instruments as are required to be filed with any such Governmental Body or
other Person pursuant to applicable rules and regulations promulgated by such
Governmental Body or other Person.
6.5 MAINTENANCE OF LICENSES AND OTHER AGREEMENTS. Maintain in
full force and effect at all times, and apply in a timely manner for renewal
of, all Licenses, trademarks, tradenames and agreements necessary for the
operation of CBC's Broadcasting Business, the loss of any of which would have a
Material Adverse Effect, and deliver to Agent (i) at least 30 days' prior
written notice of the proposed amendment of any FCC License, and (ii) (A)
evidence of the filing of any application for renewal of any FCC Licenses not
less than the earlier of (x) 60 days prior to the expiration of such FCC
License or (y) the last day such application may be filed in accordance with
applicable law and (B) copies of any petition filed to deny any such renewal
application promptly after receipt thereof by either Borrower.
6.6 INSURANCE.
6.6.1 KEY MAN LIFE INSURANCE. Maintain in full force and effect
at all times policies of insurance in such form and issued by such
insurers as shall be reasonably acceptable to Agent, insuring the life
of Wilson in the amount of $5,000,000 and deliver to Agent, from time
to time as Agent may reasonably request, evidence of compliance with
this subsection 6.6.1.
6.6.2 BUSINESS INSURANCE. Maintain in full force and effect at
all times Business Insurance as required by the insurance letter, a
copy of which is attached hereto as EXHIBIT 6.6.2, all of which shall
be written by insurers and in amounts and forms reasonably satisfactory
to Agent and otherwise comply with the terms of such insurance letter,
and deliver to Agent, from time to time as Agent may reasonably
request, evidence of compliance with this subsection 6.6.2.
6.6.3 BUSINESS INSURANCE, CLAIMS AND PROCEEDS. Borrowers hereby
directs all insurers under all policies of Business Insurance to pay
all proceeds payable thereunder directly to Agent and Borrowers hereby
authorizes Agent to collect all such proceeds, subject to Borrowers'
rights as described below in this Section 6.6.3 to receive certain
proceeds. Borrowers irrevocably appoints Agent (and all officers,
employees or agents designated by Agent) as Borrowers' true and lawful
attorney and agent in fact for the purpose of and with power to make,
settle and adjust claims under such policies of insurance, endorse the
name of any Borrower on any check, draft, instrument or other item of
payment for the proceeds of such policies of insurance, and to make all
determinations and decisions with respect to such policies of
insurance. Borrowers acknowledge that such appointment as attorney and
agent in fact is a power, coupled with an interest, and therefore is
irrevocable. Borrowers shall notify Agent and Lenders promptly of any
loss, damage, destruction or other casualty to the Collateral in excess
of $250,000. If the proceeds of a casualty do not exceed $500,000 and
no Event of Default exists, at the option of Borrowers, such proceeds
shall be paid to Borrowers and
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either (i) applied to repair or replace the Property which is the
subject of such casualty or (ii) applied to the payment of the
Principal Balance. If the proceeds of a casualty exceed $500,000 or an
Event of Default exists, at the option of the Required Lenders, such
proceeds shall be (i) applied to the payment of Borrowers' Obligations
in such manner as the Required Lenders determine. In the event the
proceeds are to be applied to the repair or replacement of Collateral,
the Collateral shall be repaired or replaced so as to be of at least
equal value and substantially the same character as prior to such
loss, damage, destruction or other casualty. If at the election of the
Required Lenders proceeds of a casualty are not applied to the repair
or replacement of the applicable Collateral, Borrowers shall not be
obligated to repair or replace such Collateral.
6.6.4 FLOOD INSURANCE. Maintain in full force and effect at all
times any flood insurance required to be provided pursuant to Article
IV and deliver to Agent, from time to time as Agent may reasonably
request, evidence of compliance with this subsection 6.6.4.
6.7 FUTURE LEASES. Except if delivered pursuant to Article IV,
deliver to Agent, concurrently with the execution by CBC, as lessee, of any
lease pertaining to real property, (i) an executed copy thereof, (ii) at the
option of Agent, either a leasehold mortgage upon or a collateral assignment of
such lease in favor of Agent, in either case in a form reasonably acceptable to
Agent, and (iii) a Landlord's Consent from the Landlord under such lease.
6.8 FUTURE ACQUISITIONS OF REAL PROPERTY. Except if delivered
pursuant to Article IV, deliver to Agent concurrently with the (i) execution by
CBC of any contract relating to the purchase by CBC of real property, an
executed copy of such contract and (ii) closing of the purchase of such real
property, (A) a first mortgage or deed of trust in favor of Agent on such real
property, in form and content reasonably satisfactory to Agent, (B) a lender's
policy of title insurance, in such form and amount and containing such
endorsements as shall be reasonably satisfactory to Agent, and (C) such other
documents and assurances with respect to such real property as Agent may
reasonably require.
6.9 ENVIRONMENTAL AUDIT. At the request of Agent deliver to
Agent an Environmental Audit with respect to any real property leased or
acquired by CBC referred to in Sections 6.7 and 6.8.
6.10 ENVIRONMENTAL MATTERS.
6.10.1 COMPLIANCE. At all times comply with, and be responsible
for, its obligations under all Environmental Laws applicable to the
Real Estate, the Leasehold Property and any other Property owned by CBC
or used by CBC in the operation of its Broadcasting Business or any
Related Business. At their sole cost and expense, Borrowers shall (i)
comply in all respects with (A) any notice of any violation or
administrative or judicial complaint or order having been filed against
CBC, any portion of the Real Estate, any Leasehold Property or any
other Property owned by CBC or used
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by CBC in the operation of its Broadcasting Business or any Related
Business alleging violations of any law, ordinance and/or regulation
requiring CBC to take any action in connection with the release,
transportation and/or clean-up of any Hazardous Materials, and (B) any
notice from any Governmental Body or any other Person alleging that
CBC is or may be liable for costs associated with a response or
clean-up of any Hazardous Materials or any damages resulting from such
release or transportation, or (ii) diligently contest in good faith by
appropriate proceedings any demands set forth in such notices,
provided (A) reserves in an amount required by GAAP to pay the costs
associated with complying with any such notice are established by CBC
and (B) no Lien would or will attach to the Property which is the
subject of any such notice as a result of any compliance by CBC which
is delayed during any such contest. Promptly upon receipt of any
notice described in the foregoing clause (i), CBC shall deliver a copy
thereof to Agent.
6.10.2 CERTIFICATION. Deliver to Agent, not later than January
1 of each year, an Environmental Compliance Certificate.
6.11 INTEREST HEDGE CONTRACT. Maintain an Interest Hedge
Contract in full force and effect during the term thereof.
6.12 COMPLIANCE WITH LAWS. Comply with all federal, state and
local laws, ordinances, requirements and regulations and all judgments, orders,
injunctions and decrees applicable to either Borrower and its operations, the
failure to comply with which would have a Material Adverse Effect.
6.13 TAXES AND CLAIMS. Pay and discharge all taxes, assessments
and governmental charges or levies imposed upon it or upon its income or
profits, or upon any Property belonging to it, prior to the date on which
penalties attach thereto, and all lawful claims which, if unpaid, might become
a Lien (other than a Permitted Lien) upon its Property, provided that Borrowers
shall not be required to pay any such amount if the same is being contested
diligently and in good faith by appropriate proceedings and as to which the
applicable Borrower has set aside reserves on its books in an amount required
by GAAP.
6.14 MAINTENANCE OF PROPERTIES. Maintain all of its Properties
necessary in the operation of CBC's Broadcasting Business in good working order
and condition.
ARTICLE VII
NEGATIVE COVENANTS
Until all of Borrowers' Obligations are paid and performed in full and
all of the Commitments have been terminated, neither Borrower shall:
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7.1 BORROWING. Create, incur, assume or suffer to exist or
permit Tele-Media to create, incur, assume or suffer to exist any liability for
Indebtedness for Borrowed Money, except (i) Borrowers' Obligations, (ii)
Permitted Senior Indebtedness, (iii) Senior Subordinated Indebtedness, (iv)
Indebtedness pursuant to the Interest Hedge Contract, (v) Seller Debt, (vi)
unsecured Indebtedness assumed by CBC in connection with a Permitted
Acquisition or Acquisition Merger in an aggregate amount not to exceed at any
time $1,000,000, (vii) Indebtedness evidenced by the Exchangeable Debentures,
provided Exchangeable Debentures shall not be issued unless no Event of Default
will exist, after giving effect to such issuance and assuming such issuance
occurred on the last day of the most recent month for which there has been
delivered to Agent the financial statements required pursuant to subsection
6.3.1.
7.2 LIENS. Create, incur, assume or suffer to exist any Lien
upon any of its Property, whether now owned or hereafter acquired, except
Permitted Liens.
7.3 MERGER AND ACQUISITION. Consolidate with or merge with or
into any Person, or make any Acquisition, except (i) a Permitted Acquisition,
(ii) the DAC Merger, (iii) the DLI Merger, (iv) the Tele-Media Merger or (v) an
Acquisition Merger.
7.4 CONTINGENT LIABILITIES. Assume, guarantee, endorse,
contingently agree to purchase, become liable in respect of any letter of
credit, or otherwise become liable upon the obligation of any Person, except
(i) liabilities arising from the endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary course of
business (ii) obligations assumed pursuant to a Permitted Acquisition, subject
to reasonable limitations imposed by the Required Lenders and (iii) obligations
with respect to Permitted Letters of Credit.
7.5 DISTRIBUTIONS. Make any dividends, distributions or other
shareholder expenditures with respect to its capital stock or apply any of its
Property to the purchase, redemption or other retirement of, or set apart any
sum for the payment of, or make any other distribution by reduction of capital
or otherwise in respect of, any of its capital stock, except (i) distributions
necessary to pay Corporate Overhead, subject to the limitations set forth in
subsection 7.6.1, (ii) dividends on the Exchangeable Preferred Stock by the
issuance of new Exchangeable Preferred Stock and (iii) so long as no Event of
Default will exist after giving effect thereto, cash dividends on the
Exchangeable Preferred Stock (A) in any year in an amount which, together with
any cash payments of interest in such year on Exchangeable Debentures, do not
exceed the Remaining Excess Cash Flow for the preceding year and (B) commencing
in January, 2003, so long as after giving effect to such payments CBC shall
have Cash Equivalents of not less than $5,000,000.
7.6 LIMITATION OF CORPORATE OVERHEAD AND CAPITAL EXPENDITURES.
7.6.1 CORPORATE OVERHEAD. Make expenditures or incur
obligations for Corporate Overhead which in the aggregate for all
Obligors are in excess of the amounts set forth in EXHIBIT 7.6.1.
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7.6.2 CAPITAL EXPENDITURES. Make Capital Expenditures which in
the aggregate for all Borrowers are in excess of the amounts set forth
in EXHIBIT 7.6.2.
7.7 PAYMENTS OF INDEBTEDNESS FOR BORROWED MONEY. Make any (i)
voluntary or optional prepayment of any Indebtedness for Borrowed Money other
than Borrowers' Obligations and the Indebtedness in the principal amount of
$12,817,000 and interest thereon owing by CBC to guarantor, (ii) payment of
interest on the Senior Subordinated Notes (A) so long as Borrowers are in
default in the payment of interest, principal or any Loan Fees under this Loan
Agreement or (B) during any Payment Blockage Period (as defined in the Note
Indenture), (iii) payment of principal on the Senior Subordinated Notes, (iv)
payment on the Exchangeable Debentures, except cash payments of interest may be
made on such Exchangeable Debentures if (A) no Event of Default will exist
after giving effect to such payments and (B) the amount of such payments and
the cash dividends on the Exchangeable Preferred Stock do not in the aggregate
exceed in any year the Remaining Excess Cash Flow for the preceding year.
7.8 OBLIGATIONS AS LESSEE UNDER OPERATING LEASES. Enter into
any arrangement as lessee of Property under any Operating Lease if the
aggregate rentals for all such Operating Leases for Borrowers during any year
would exceed the applicable amount set forth in EXHIBIT 7.8.
7.9 INVESTMENTS. At any time purchase or otherwise acquire,
hold or invest in the capital stock of, or any other interest in, any Person,
or make any loan or advance to, or enter into any arrangement for the purpose
of providing funds or credit to, or make any other investment, whether by way
of capital contribution or otherwise, in or with any Person, including, without
limitation, any Affiliate, except (i) investments in direct obligations of, or
instruments unconditionally guaranteed by, the United States of America or in
certificates of deposit issued by a Qualified Depository, (ii) investments in
commercial or finance paper which, at the time of investment, is rated "A," or
better by Moody's Investors Service, Inc., or Standard & Poor's Corporation,
respectively, or at the equivalent rate by any of their respective successors,
(iii) any interests in any money market account maintained, at the time of
investment, with a Qualified Depository, the investments of which, at the time
of investment, are restricted to the types specified in clause (i) above, (iv)
Permitted Acquisitions, (v) loans from one Operating Company to another
Operating Company, (vi) loans to employees of Borrowers or Parent in an
aggregate amount not to exceed $50,000 for all Obligors outstanding at any time
and (vii) the formation and capitalization of Permitted Subsidiaries. All
investments permitted pursuant to clauses (i), (ii) and (iii) of this Section
7.9 shall have a maturity not exceeding one year.
7.10 FUNDAMENTAL BUSINESS CHANGES; LIMITATIONS ON NON-OPERATING
COMPANIES. Permit (i) any Operating Company to materially change the nature of
its business or engage in any business other than the Broadcasting Business and
Related Businesses or (ii) any Non-Operating Company to (A) engage in any
business other than being the licensee of FCC Licenses or (B) incur any
Indebtedness except Borrowers' Obligations.
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7.11 SALE OR TRANSFER OF ASSETS. Sell, lease, assign, transfer
or otherwise dispose of any Property (other than in the ordinary course of
business) except for (i) the sale or disposition of (A) Property which is not
material to or necessary for the continued operation of CBC's Broadcasting
Business and (B) obsolete or unusable items of equipment which promptly are
replaced with new items of equipment of like function and comparable value to
the unusable items of equipment when the same were new or not obsolete or
unusable, provided such replacement items of equipment shall become subject to
the Security Interests and (ii) Permitted Dispositions.
7.12 AMENDMENT OF INSTRUMENTS; ARTICLES OF INCORPORATION. Enter
into any Prohibited Amendment.
7.13 ACQUISITION OF ADDITIONAL PROPERTIES. Enter into an
agreement with respect to a proposed Acquisition unless such agreement provides
that the only remedy against the Borrower entering into such agreement in the
event of default by CBC thereunder is liquidated damages in an amount not to
exceed 10% of the purchase price, or acquire any additional Property except (i)
such Property as necessary to or useful in the operation of its business,
provided such acquisitions shall be subject to the conditions and limitations
set forth in this Loan Agreement and (ii) such acquisitions of Property as are
permitted pursuant to Section 7.3 or 7.9.
7.14 ISSUANCE OF CAPITAL STOCK; DEBT SECURITIES. Issue or permit
to be issued any additional capital stock or any interests convertible into or
exercisable for any such additional capital stock or any debt securities.
7.15 TRANSACTIONS WITH AFFILIATES. Sell, lease, assign,
transfer or otherwise dispose of any Property to any Affiliate of any Obligor,
render or receive services or purchase assets from any such Affiliate, or
otherwise enter into any contractual relationship with any Affiliate of any
Obligor, except as set forth in EXHIBIT 7.15.
7.16 COMPLIANCE WITH ERISA.
(i) permit the occurrence of any Termination Event which would
result in a liability to any Obligor or ERISA Affiliate in excess of
$100,000;
(ii) permit the present value of all benefit liabilities under
all Pension Plans to exceed the current value of the assets of such
Pension Plans allocable to such benefit liabilities by more than
$100,000;
(iii) permit any accumulated funding deficiency in
excess of $100,000 (as defined in Section 302 of ERISA and Section 412
of the Code) with respect to any Pension Plan, whether or not waived;
(iv) fail to make any contribution or payment to any
Multiemployer Plan which any Obligor or ERISA Affiliate may be
required to make under any agreement
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relating to such Multiemployer Plan, or any law pertaining thereto
which results in or is likely to result in a liability in excess of
$100,000;
(v) engage, or permit any Obligor or ERISA Affiliate
to engage, in any "prohibited transaction" as such term is defined in
Section 406 of ERISA or Section 4975 of the Code for which a civil
penalty pursuant to Section 502(i) of ERISA or a tax pursuant to
Section 4975 of the Code in excess of $100,000 is imposed;
(vi) permit the establishment of any Employee Benefit
Plan providing post-retirement welfare benefits or establish or amend
any Employee Benefit Plan which establishment or amendment could
result in liability to any Obligor or ERISA Affiliate or increase the
obligation of any Obligor or ERISA Affiliate to a Multiemployer Plan
which liability or increase, individually or together with all similar
liabilities and increases, is material to any Obligor or ERISA
Affiliate; or
(vii) fail, or permit any Obligor or ERISA Affiliate
to fail to establish, maintain and operate each Employee Benefit Plan
in compliance in all material respects with ERISA, the Code and all
other applicable laws and regulations and interpretations thereof.
7.17 LMA AGREEMENTS. Enter into, renew or extend an LMA, except
(i) the LMA Agreements, (ii) an LMA to operate a Station in a then existing
Broadcast Market, (iii) an LMA to operate a Station in other than a then
existing Broadcast Market, but only if Borrowers have demonstrated to the
reasonable satisfaction of the Required Lenders that Borrowers would not suffer
operating losses as a result of the operation of the Station or Stations which
are the subject of such agreement.
7.18 BUSINESS LOCATIONS. Change the location of its chief
executive office, any of its Property or any studio, transmitter, antennae, or
offices used in the operation of any of the CBC Stations, or the place where
its books and records are kept unless (i) Agent shall have received at least 30
days' prior written notice thereof, (ii) Borrowers shall have complied with all
applicable laws, rules and regulations and shall have received all required
consents and approvals from any Governmental Body, including, without
limitation, the FCC, (iii) Agent shall have received satisfactory evidence that
such change could not reasonably be expected to affect adversely the operations
or business prospects of Borrowers and (iv) Borrowers shall have executed and
delivered to Agent any documents Agent may reasonably require in order to
maintain the validity and priority of the Security Interests.
7.19 MAXIMUM LEVERAGE TEST. Permit the ratio of Total Debt as
of the last day of any month to the Adjusted Operating Cash Flow for the
12-month period ending as of the last day of such month to be greater than the
Applicable Ratio on such date.
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7.20 SENIOR DEBT LEVERAGE. Permit the ratio of the Principal
Balance as of the last day of any month to the Adjusted Operating Cash Flow for
the 12-month period ending on such date to be greater than the ratios set forth
below:
Each Month During Period Ratio
------------------------ -----
Closing Date - November, 1997 5.25
December, 1997 - May, 1998 5.00
June, 1998 - November, 1998 4.75
December, 1998 - May, 1999 4.50
June, 1999 - November, 1999 4.25
December, 1999 - May, 2000 4.00
June, 2000 - November, 2000 3.75
December, 2000 - May 2001 3.50
June, 2001 - November, 2001 3.25
December, 2001 - May, 2002 3.00
June, 2002 - November, 2002 2.75
December, 2002 - June, 2003 2.50
7.21 MINIMUM INTEREST COVERAGE. Permit the ratio of
consolidated Operating Cash Flow of Borrowers for any Four-Quarter Period
ending as of the end of any quarter set forth below to Interest Expense and
cash dividends on the Exchangeable Preferred Stock for such Four-Quarter Period
to be less than the ratio set forth opposite such period:
Four Quarter Period Ending Ratio
-------------------------- -----
September, 1997, December, 1997 1.75
March, 1998, June, 1998, 2.00
September, 1998, December, 1998
March, 1999 and each quarter 2.25
thereafter
7.22 MINIMUM FIXED CHARGES. Permit the ratio of the consolidated
Operating Cash Flow of Borrowers for any Four-Quarter Period to Fixed Charges
for such Four-Quarter Period to be less than 1.1 to 1.
ARTICLE VIII
DEFAULT AND REMEDIES
8.1 EVENTS OF DEFAULT. The occurrence of any of the following shall
constitute an Event of Default under the Loan Instruments:
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8.1.1 DEFAULT IN PAYMENT. If Borrowers shall fail to
pay all or any portion of the Principal Balance when the same becomes
due and payable or any other of the Borrowers' Obligations within five
days after the same become due and payable.
8.1.2 BREACH OF COVENANTS.
(a) If Borrowers shall fail to observe or
perform any covenant or agreement made by Borrowers
contained in Section 4.2, 6.1, 6.2, 6.6, 6.10, 6.11 or in
Article VII;
(b) If any Obligor shall fail to observe or
perform any covenant or agreement (other than those referred
to in subparagraph (a) above or specifically addressed
elsewhere in this Section 8.1) made by such Person in any of
the Loan Instruments to which such Person is a party, and
such failure shall continue for a period of 30 days after
written notice of such failure is given by Agent.
8.1.3 BREACH OF WARRANTY. If any representation or
warranty made by or on behalf of any Obligor in or pursuant to any of
the Loan Instruments or in any instrument or document furnished in
compliance with the Loan Instruments shall prove to be false or
misleading in any material respect on the date as of which made.
8.1.4 DEFAULT UNDER OTHER INDEBTEDNESS FOR BORROWED
MONEY. If (i) either Borrower at any time shall be in default (as
principal or guarantor or other surety) in the payment of any
principal of or premium or interest on any Indebtedness for Borrowed
Money (other than Borrowers' Obligations) beyond the grace period, if
any, applicable thereto and the aggregate amount of such payments then
in default beyond such grace period shall exceed $250,000 or (ii) any
default shall occur in respect of any issue of Indebtedness for
Borrowed Money of either Borrower (other than Borrowers' Obligations)
outstanding in a principal amount of at least $250,000, or in respect
of any agreement or instrument relating to any such issue of
Indebtedness for Borrowed Money, and such default shall continue
beyond the grace period, if any, applicable thereto.
8.1.5 BANKRUPTCY.
(a) If Guarantor or either Borrower shall (i)
generally not be paying its debts as they become due, (ii)
file, or consent, by answer or otherwise, to the filing
against it of a petition for relief or reorganization or
arrangement or any other petition in bankruptcy or
insolvency under the laws of any jurisdiction, (iii) make an
assignment for the benefit of creditors, (iv) consent to the
appointment of a custodian, receiver, trustee or other
officer with similar powers for it or for any substantial
part of its Property, or (v) be adjudicated insolvent.
(b) If any Governmental Body of competent
jurisdiction shall enter an order appointing, without consent
of the applicable Borrower or Guarantor, a
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custodian, receiver, trustee or other officer with similar
powers with respect to it or with respect to any substantial
part of such Person's Property, or if an order for relief
shall be entered in any case or proceeding for liquidation
or reorganization or otherwise to take advantage of any
bankruptcy or insolvency law of any jurisdiction, or
ordering the dissolution, winding-up or liquidation of
either Borrower or Guarantor or if any petition for any such
relief shall be filed against any such Person and such
petition shall not be dismissed or stayed within 60 days.
8.1.6 JUDGMENTS. If there shall exist final judgments
or awards against any Obligor which shall have been outstanding for a
period of 60 days or more from the date of the entry thereof and shall
not have been discharged in full or stayed pending appeal, if (i) any
such judgment or award not covered by insurance exceeds $50,000 or
(ii) the aggregate amount of all such judgments and awards against
Obligors not covered by insurance exceeds $500,000.
8.1.7 IMPAIRMENT OF LICENSES; OTHER AGREEMENTS. If (i)
any Governmental Body shall (A) revoke, terminate, suspend or
adversely modify any License of either Borrower, the continuation of
which is material to the continuation of the Broadcasting Business of
CBC, or (B) schedule or conduct a hearing on the renewal of any FCC
License necessary for the continuation of such Broadcasting Business
or (ii) there shall exist any violation or default in the performance
of, or a material failure to comply with any agreement, or condition
or term of any FCC License, which violation, default or failure could
reasonably be expected to have a Material Adverse Effect, or (iii) any
agreement which is necessary to the operation of such Broadcasting
Business shall be revoked or terminated and not replaced by a
substitute acceptable to the Required Lenders within 30 days after the
date of such revocation or termination, and such revocation or
termination and non-replacement could reasonably be expected to have a
Material Adverse Effect.
8.1.8 COLLATERAL. If any material portion of the
Collateral shall be seized or taken by a Governmental Body or Person,
or Borrowers shall fail to maintain or cause to be maintained the
Security Interests and priority of the Loan Instruments as against any
Person, or the title and rights of any Obligor to any material portion
of the Collateral shall have become the subject matter of litigation
which could reasonably be expected to result in impairment or loss of
the security provided by the Loan Instruments.
8.1.9 INTERRUPTION OF OPERATIONS. If the on-the-air
broadcasting operations of CBC Stations in two or more markets shall
cease completely at any time for more than 72 hours during any period
of 10 consecutive days, unless (i) the broadcasting operations of all
or substantially all of the radio stations in the relevant market also
are interrupted for a like period of time or (ii) Borrowers shall be
receiving during such period proceeds of business interruption
insurance sufficient to assure that the per diem consolidated
Operating Cash Flow of CBC during such period is at least equal to the
average per diem consolidated Operating Cash Flow of CBC preceding the
initial date of interruption;
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provided, however, that, notwithstanding the provisions of clause (ii)
to the contrary, an Event of Default shall be deemed to occur
hereunder if the default described in of this subsection 8.1.9
continues for a period of 120 hours during any period of 20
consecutive days.
8.1.10 PLANS. If an event or condition specified in
subsection 6.3.10 hereof shall occur or exist with respect to any
Pension Plan or Multiemployer Plan and, as a result of such event or
condition, together with all other such events or conditions, either
Borrower or any ERISA Affiliate shall incur, or in the opinion of the
Required Lenders be reasonably likely to incur, a liability to a
Pension Plan or Multiemployer Plan or the PBGC (or any of them) which,
in the reasonable judgment of the Required Lenders, would have a
Material Adverse Effect.
8.1.11 CHANGE IN CONTROL; CESSATION OF WILSON'S
ACTIVITIES. If at any time (i) Guarantor shall cease to own or control
all of the CBC Common Stock, (ii) CBC shall cease to own or control
all of the capital stock of CLI, (iii) any Person or Affiliate of such
Person, other than ABRY Broadcast Partners II, a Delaware limited
partnership, and Wilson or their respective Affiliates, own capital
stock possessing more than 35% of the voting power of all voting stock
of Guarantor, (iv) Wilson shall die, become permanently disabled or
cease, for a period in excess of 60 days, to devote his full business
time to the operation of CBC's Broadcasting Business, unless Wilson is
replaced by a person reasonably acceptable to the Required Lenders
within 90 days after such death, disability or cessation or (v) a
Change of Control (as defined in the Senior Subordinated Debt
Instruments and the Exchangeable Preferred Stock Instruments) shall
occur.
8.1.12 GUARANTY. If (i) the Guaranty shall cease to be
in full force and effect, (ii) Guarantor shall deny or disaffirm its
obligations thereunder or (iii) Guarantor shall fail to make any
payment thereunder when due.
8.2 ACCELERATION OF BORROWER'S OBLIGATIONS. Upon the occurrence of:
(a) any Event of Default described in clauses (ii),
(iii), (iv) and (v) of subsection 8.1.5(a) or in 8.1.5(b), the
Commitments shall automatically terminate and all of Borrowers'
Obligations at that time outstanding automatically shall mature and
become due, and
(b) any other Event of Default, upon the written
request of the Required Lenders, and by delivery of written notice to
Borrowers from the Agent (unless such Event of Default shall have been
waived in writing or remedied), all Commitments shall terminate and
all of Borrowers' Obligations shall become immediately due and
payable, whereupon all Commitments shall immediately terminate and
Borrowers' Obligations immediately shall mature and become due and
payable,
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all without presentment, demand, protest or notice (other than notice of the
declaration referred to in clause (b) above), all of which hereby are waived.
8.3 RESCISSION OF ACCELERATION. After acceleration of the
maturity of Borrowers' Obligations, if all interest, principal and other
amounts which are then due (other than by reason of acceleration) are paid and
all Events of Default then existing are waived in accordance with Section 13.6,
the Lenders may elect in their sole discretion to rescind the acceleration.
8.4 REMEDIES ON DEFAULT.
8.4.1 REMEDIES UPON ACCELERATION. If Borrowers'
Obligations have been accelerated pursuant to Section 8.2, upon the
written request and at the direction of the Required Lenders the
Agent may:
(a) ENFORCEMENT OF SECURITY INTERESTS. Enforce
its rights and remedies under the Loan Instruments in
accordance with their respective terms.
(b) OTHER REMEDIES. Enforce any of the rights or
remedies accorded to Lenders and/or Agent at equity or law,
by virtue of statute or otherwise.
8.4.2 BLOCKAGE NOTICE. Upon the occurrence and during
the existence of an Event of Default, other than a default in the
payment of principal, interest or any Loan Fees, whether or not
Borrowers' Obligations have been accelerated pursuant to Section 8.2,
upon the written request and the direction of the Required Lenders,
the Agent shall, subject to the limitations set forth in the Note
Indenture, send a Blockage Notice (as defined in the Note Indenture)
to the trustee under the Note Indenture and the Borrowers imposing a
Payment Blockage Period (as defined in the Indenture).
8.5 APPLICATION OF FUNDS. At any time an Event of Default
exists, any funds received by Lenders or Agent pursuant to the exercise of any
rights accorded to Lenders and/or Agent pursuant to, or by the operation of any
of the terms of, any of the Loan Instruments, including, without limitation,
insurance proceeds, condemnation proceeds or proceeds from the sale of
Collateral, shall be applied to Borrowers' Obligations in the following order
of priority:
8.5.1 EXPENSES. First, to the payment of (i) all fees
and expenses actually incurred, including, without limitation, court
costs, fees of appraisers, title charges, costs of maintaining and
preserving the Collateral, costs of sale, and all other costs incurred
by Agent and Lenders, in exercising any rights accorded to such
Persons pursuant to the Loan Instruments or by applicable law,
including, without limitation, reasonable attorney's fees, and (ii)
all Liens superior to the Liens of Agent except such superior Liens
subject to which any sale of the Collateral may have been made.
8.5.2 EXISTING PREPAYMENT PREMIUM. Next, to FINOVA in
payment of the Existing Prepayment Premium.
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8.5.3 BORROWERS' OBLIGATIONS. Next, to the Lenders in
proportion to their respective Ratable Shares of the remaining portion
of Borrowers' Obligations.
8.5.4 SURPLUS. Any surplus, to the Person or Persons
entitled thereto.
8.6 PERFORMANCE OF BORROWER'S OBLIGATIONS. If Borrowers fail
to (i) maintain in force and pay for any insurance policy or bond which
Borrowers are required to provide pursuant to any of the Loan Instruments, (ii)
keep the Collateral free from all Liens except for Permitted Liens, (iii) pay
when due all taxes, levies and assessments on or in respect of the Collateral,
except as otherwise permitted pursuant to the terms hereof, (iv) make all
payments and perform all acts on the part of Borrowers to be paid or performed
in the manner required by the terms hereof and by the terms of the other Loan
Instruments with respect to any of the Collateral, including, without
limitation, all expenses of protecting, storing, warehousing, insuring,
handling and maintaining the Collateral, (v) keep fully and perform promptly
any other of the obligations of Borrowers hereunder or under any of the other
Loan Instruments, and (vi) keep fully and perform promptly the obligations of
Borrowers with respect to any issue of Indebtedness for Borrowed Money secured
by a Permitted Prior Lien, then Agent may (but shall not be required to)
procure and pay for such insurance policy or bond, place such Collateral in
good repair and operating condition, pay, contest or settle such Liens or taxes
or any judgments based thereon or otherwise make good any other aforesaid
failure of Borrowers. Borrowers shall reimburse Agent immediately upon demand
for all sums paid or advanced on behalf of Borrowers for any such purpose,
together with costs and expenses (including reasonable attorney's fees) paid or
incurred by Agent in connection therewith and interest on all sums advanced
from the date of advancement until repaid to Agent at the Default Rate. All
such sums advanced by Agent, with interest thereon, immediately upon
advancement thereof, shall be deemed to be part of Borrowers' Obligations.
8.7 RIGHT OF SETOFF. In addition to and not in limitation of
all rights of offset that any Lender may have under applicable law, upon the
occurrence of any Event of Default, and whether or not any Lender has made any
demand or the Borrowers' Obligations have matured, each Lender shall have the
right to appropriate and apply to the payment of Borrowers' Obligations all
deposits and other obligations then or thereafter owing by such Lender to any
Borrower. Each Lender exercising such rights shall notify the Agent thereof and
any amount received as a result of the exercise of such rights shall be shared
by the Lenders in accordance with their Ratable Shares.
ARTICLE IX
THE AGENT
9.1 APPOINTMENT. Each Lender hereby irrevocably appoints and
authorizes FINOVA to act as Agent for such Lender under this Loan Agreement and
to execute and deliver or accept the other Loan Instruments on behalf of such
Lender. Each Lender hereby irrevocably
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authorizes, and each holder of any Note by the acceptance of a Note shall be
deemed irrevocably to authorize, the Agent to take such action on its behalf
under the provisions of this Loan Agreement and the other Loan Instruments and
any other instruments and agreements referred to herein and therein, and to
exercise such powers and to perform such duties hereunder as are specifically
delegated to or required of the Agent by the terms of this Loan Agreement,
together with such powers as are reasonably incidental thereto. FINOVA agrees
to act as the Agent on behalf of the Lenders to the extent provided in this
Loan Agreement.
9.2 DELEGATION OF DUTIES. The Agent may perform any of its
respective duties hereunder by or through agents or employees and shall be
entitled to engage and pay for the advice or services of any attorneys,
accountants or other experts concerning all matters pertaining to its duties
hereunder and to rely upon any advice so obtained.
9.3 NATURE OF DUTIES; INDEPENDENT CREDIT INVESTIGATION. The
Agent shall have no duties or responsibilities except those expressly set forth
in this Loan Agreement and no implied covenants, functions, responsibilities,
duties, obligations, or liabilities shall be read into this Loan Agreement or
otherwise exist. The duties of the Agent shall be mechanical and administrative
in nature. Agent shall not have by reason of this Loan Agreement a fiduciary or
trust relationship in respect of any Lender, and nothing in this Loan Agreement
express or implied, is intended to or shall be so construed as to impose upon
the Agent any obligations in respect of this Loan Agreement except as expressly
set forth herein. Each Lender expressly acknowledges that (i) the Agent has not
made any representations or warranties to it and that no act by the Agent
hereafter taken, including any review of the affairs of any of the Obligors
shall be deemed to constitute any representation or warranty by the Agent to
any Lender and (ii) it has made and will continue to make, without reliance
upon the Agent, its own independent investigation of the financial condition
and affairs and its own appraisal of the creditworthiness of each of the
Obligors and the condition and value of the Collateral in connection with this
Loan Agreement and the making of the Loans.
9.4 INSTRUCTIONS FROM LENDERS. The Agent shall have the right
to request instructions from the Required Lenders by notice to each of the
Lenders. If the Agent shall request instructions from the Lenders with respect
to any act or action (including the failure to act) in connection with this
Loan Agreement, the Agent shall be entitled to refrain from such act or taking
such action unless and until the Agent shall have received instructions from
the Required Lenders, and the Agent shall not incur liability to any Person by
reason of so refraining. No Lender shall have any right of action against the
Agent as a result of the Agent acting or refraining from acting in accordance
with the instructions of the Required Lenders.
9.5 EXCULPATORY PROVISIONS. None of the Agent or any of its
respective directors, officers, employees, agents, attorneys or Affiliates
shall (i) be liable to any Lender for any action taken or omitted to be taken
by it or them pursuant to any Loan Instruments unless caused by it or its
respective directors, officers, employees, agents, attorneys or Affiliates own
gross negligence or willful misconduct, (ii) be responsible in any manner to
any of the Lenders for the effectiveness, enforceability, genuineness, validity
or due execution of this Loan Agreement
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or any other Loan Instruments or for any recital, representation, warranty,
document, certificate, report or statement herein or made or furnished under or
in connection with this Loan Agreement or any other Loan Instruments, or (iii)
be under any obligation to any of the Lenders to ascertain or to inquire as to
the performance or observance of any of the terms, covenants or conditions
hereof or thereof on the part of the Obligors, the financial condition of the
Obligors, or the existence or possible existence of any Event of Default or
Incipient Default.
9.6 REIMBURSEMENT AND INDEMNIFICATION BY LENDERS OF THE AGENT.
Each Lender agrees to reimburse and indemnify the Agent (to the extent not
reimbursed by Borrowers and without limiting the obligation of Borrowers to do
so) in proportion to its Ratable Share from and against all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against the Agent in its capacity as such, in any
way relating to or arising out of this Loan Agreement or any other Loan
Instruments or any action taken or omitted by the Agent hereunder or
thereunder, provided that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Agent's gross
negligence or willful misconduct.
9.7 RELIANCE BY AGENT. The Agent shall be entitled to rely
upon any writing, telegram, telex or teletype message, resolution, notice,
consent, certificate, letter, statement, order or other document or
conversation by telephone or otherwise believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons, and upon
the advice and opinions of counsel and other professional advisers selected by
the Agent. The Agent shall be fully justified in failing or refusing to take
any action hereunder unless it shall first be indemnified to its satisfaction
by the Lenders against any and all liability and expense (other than a
liability or expense relating to gross negligence or willful misconduct) which
may be incurred by it by reason of taking or continuing to take any such
action.
9.8 NOTICE OF DEFAULT. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Incipient Default or Event of
Default unless the Agent has received written notice from a Lender or the
Borrowers referring to this Loan Agreement, describing such Incipient Default
or Event of Default and stating that such notice is a "notice of default."
9.9 RELEASE OF COLLATERAL. The Lenders hereby authorize the
Agent to release any Lien granted to Agent upon any Collateral upon (i)
termination of the Commitments and payment and satisfaction of all of
Borrowers' Obligations or (ii) the request of Borrowers if such release is
required pursuant to the terms of any of the Loan Instruments.
9.10 LENDERS IN THEIR INDIVIDUAL CAPACITIES. With respect to
the Commitments and the Loans made by it, the Agent shall have the same rights
and powers as any other Lender and may exercise the same as thought it were not
the Agent, and the term "Lenders" shall, unless the context otherwise
indicates, include the Agent in its individual capacity. The Agent and its
Affiliates and each of the Lenders and their respective Affiliates may, without
liability to account, except as prohibited herein, make loans to, accept
deposits from, discount drafts for,
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act as trustee under indentures of, and generally engage in any kind of banking
or trust business with, the Obligors and their Affiliates as though such Lender
were not a Lender hereunder.
9.11 HOLDERS OF NOTES. The Agent may deem and treat any payee
of any Note as the owner hereof for all purposes unless and until the Agent
receives an Assignment and Acceptance with respect thereto. Any request,
authority or consent of any Person who at the time of making such request or
giving such authority or consent is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee or assignee of such Note or of
any Note or Notes issued in exchange therefor.
9.12 SUCCESSOR AGENT. The Agent may resign at any time by
giving not less than 30 days' prior written notice to the Borrowers and the
other Lenders and the Agent may be removed at any time with or without cause by
the Required Lenders. The Required Lenders shall have the right to appoint a
successor Agent with the consent of Borrowers, which consent shall not be
unreasonably withheld. If a successor Agent is not appointed within 30 days
following the Agent's notice of its resignation or its removal, the Agent shall
appoint a successor agent who shall serve as Agent until such time as the
Required Lenders appoint a successor Agent. Upon its appointment, such
successor Agent shall succeed to the rights, powers and duties of the Agent and
the term "Agent" shall mean such successor effective upon its appointment, and
the former Agent's rights, powers and duties as Agent shall be terminated
without any other or further act or deed on the part of such former Agent or
any of the parties to this Agreement. After the resignation of any Agent, the
provisions of this Article IX shall inure to the benefit of such former Agent
and such former Agent shall not by reason of such resignation be deemed to be
released from liability for any actions taken or not taken by it while it was
the Agent.
9.13 DELIVERY OF INFORMATION. The Agent shall not be required
to deliver to any Lender originals or copies of any documents, instruments,
reports, notices, communications or other information received by the Agent
from the Obligors or any other Person under or in connection with any Loan
Instruments except (i) as specifically provided in the Loan Instruments or (ii)
as specifically requested from time to time in writing by any Lender with
respect to a specific document, instrument, notice or other written
communication received by and in the possession of the Agent at the time of
receipt of such request and then only in accordance with such specific request.
9.14 BENEFICIARIES. Except as expressly provided in this Loan
Agreement, the provisions of this Article IX are solely for the benefit of the
Agent and the Lenders, and the Obligors shall not have any rights to rely on or
enforce any of the provisions hereof. In performing its functions and duties
under this Loan Agreement, the Agent shall act solely as agent of the Lenders
and does not assume and shall not be deemed to have assumed any obligation
toward or relationship of agency or trust with or for any of the Obligors.
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ARTICLE X
LOAN ASSIGNMENT AND PARTICIPATION
10.1 ASSIGNMENT TO OTHER LENDERS.
10.1.1 ASSIGNMENT. Each Lender may assign to one of its
affiliates and may, with the written consent of Borrowers which shall
not be unreasonably withheld, assign to one or more other financial
institutions all or any portion of its Commitment and its rights and
obligations under this Loan Agreement with respect thereto (a "Loan
Assignment"), provided, however, that (i) each Loan Assignment shall
be of a constant, and not a varying, percentage of all rights and
obligations of such Lender under this Loan Agreement, (ii) the amount
of the Commitment of the assigning Lender being assigned pursuant to
each such Loan Assignment shall not be less than the lesser of
$5,000,000 or the remaining amount of such Lender's Commitment and
shall be in integral multiples of $1,000,000 in excess thereof, and
(iii) the parties to each such Loan Assignment shall execute and
deliver to the Agent an Assignment and Acceptance, together with any
Note or Notes subject to such assignment.
10.1.2 EFFECT OF ASSIGNMENT. Upon the execution,
delivery, acceptance and recording of an Assignment and Acceptance (i)
the Assignee thereunder shall be a party to this Loan Agreement and,
to the extent that rights and obligations hereunder have been assigned
to it pursuant to such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder and (ii) the Lender thereunder
shall, to the extent that rights and obligations hereunder have been
assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights and be released from its obligations under this Loan
Agreement.
10.1.3 REGISTER. The Agent shall maintain a copy of
each Assignment and Acceptance delivered to and accepted by it and a
register for the recordation of the names, addresses, and Commitments
of the Lenders (the "Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and
the Borrowers, the Agent and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for
inspection by the Borrowers or any Lender at any reasonable time and
from time to time upon reasonable prior notice.
10.1.4 SUBSTITUTION OF NOTES. Simultaneously with the
delivery by Agent to Borrowers of any Note which is the subject of a
Loan Assignment which is marked "canceled," Borrowers shall execute
and deliver to Agent for delivery to (i) the applicable Assignee, a
Note payable to the order of such Assignee in an amount equal to the
amount assigned to such Assignee, and (ii) the assigning Lender, a
Note payable to the order of such Lender in an amount equal to the
amount retained by such Lender, each such Note to be substantially in
the form of the canceled Note.
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10.2 PARTICIPATIONS. Each Lender shall have the right to sell
Participations in all or any portion of its rights and obligations under this
Loan Agreement. In the event of the sale of a Participation, the obligations of
the Lender selling such a Participation shall remain unchanged, such Lender
shall remain solely responsible to the other parties to this Loan Agreement for
the performance thereof, such Lender shall remain the holder of any Note which
previously has been delivered to Lender pursuant to the terms of this Loan
Agreement, and Borrowers shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this Loan
Agreement.
ARTICLE XI
CLOSING
The Closing Date shall be such date as the parties shall determine,
and the Closing shall take place on such date, provided all conditions for the
Closing as set forth in this Loan Agreement have been satisfied or otherwise
waived by the Lenders. The Closing shall occur at such place as the parties
hereto shall agree. Unless the Closing occurs on or before July 31, 1997, this
Loan Agreement shall terminate and be of no further force or effect and, except
for any obligation of Borrowers to Agent and Lenders pursuant to Article XII,
none of the parties hereto shall have any further obligation to any other
party.
ARTICLE XII
EXPENSES AND INDEMNITY
12.1 ATTORNEY'S FEES AND OTHER FEES AND EXPENSES. Whether or
not any of the transactions contemplated by this Loan Agreement shall be
consummated, Borrowers agree to pay to Agent and Lenders on demand all expenses
incurred by Agent and Lenders in connection with the transactions contemplated
hereby and in connection with any amendments, modifications or waivers (whether
or not the same become effective) under or in respect of any of the Loan
Instruments, including, without limitation:
12.1.1 FEES AND EXPENSES FOR PREPARATION OF LOAN
INSTRUMENTS. All expenses and disbursements (including, without
limitation, charges for required mortgagee's title insurance, lien
searches, reproduction of documents, long distance telephone calls,
overnight express carriers, appraisal fees, recording charges and
environmental audit fees) and reasonable attorney's fees actually
incurred by Agent and Lenders in connection with the (i) preparation,
review and negotiation of the Loan Instruments or any amendments,
modifications or waivers thereto or any documents delivered pursuant
thereto and (ii) administration of the Loans.
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12.1.2 FEES AND EXPENSES IN ENFORCEMENT OF RIGHTS OR
DEFENSE OF LOAN INSTRUMENTS. Any expenses or other costs, including
reasonable attorney's fees and expert witness fees, actually incurred
by Agent and Lenders in connection with the enforcement or collection
against any Obligor of any provision of any of the Loan Instruments,
and in connection with or arising out of any litigation, investigation
or proceeding instituted by any Governmental Body or any other Person
with respect to any of the Loan Instruments, whether or not suit is
instituted, including, but not limited to, such costs or expenses
arising from the enforcement or collection against any Obligor of any
provision of any of the Loan Instruments in workout or restructuring
or in any state or federal bankruptcy or reorganization proceeding.
12.2 INDEMNITY. Borrowers agree to indemnify and save Agent and
Lenders harmless of and from the following:
12.2.1 BROKERAGE FEES. The fees, if any, of brokers and
finders engaged by Borrowers.
12.2.2 GENERAL. Any loss, cost, liability, damage or
expense (including reasonable attorney's fees and expenses) incurred
by Agent and Lenders in investigating, preparing for, defending
against, providing evidence, producing documents or taking other
action in respect of any commenced or threatened litigation,
administrative proceeding, suit instituted by any Person or
investigation under any law, including any federal securities law, the
Bankruptcy Code, any relevant state corporate statute or any other
securities law, bankruptcy law or law affecting creditors generally of
any jurisdiction, or any regulation pertaining to any of the
foregoing, or at common law or otherwise, relating, directly or
indirectly, to the transactions contemplated by or referred to in, or
any other matter related to, the Loan Instruments, whether or not
Agent or any Lender is a party to such litigation, proceeding or suit,
or is subject to such investigation.
12.2.3 OPERATION OF COLLATERAL; JOINT VENTURERS. Any
loss, cost, liability, damage or expense (including reasonable
attorney's fees and expenses) incurred in connection with the
ownership, operation or maintenance of the Collateral, the
construction of Agent or any Lender and Borrowers as having the
relationship of joint venturers or partners or the determination that
Agent or any Lender has acted as agent for any Borrower.
12.2.4 ENVIRONMENTAL INDEMNITY. Any and all claims,
losses, damages, response costs, clean-up costs and expenses suffered
and/or incurred at any time by Agent and any Lender arising out of or
in any way relating to the existence at any time of any Hazardous
Materials in, on, under, at, transported to or from, or used in the
construction and/or renovation of, any of the Real Property or
Leasehold Property, or otherwise with respect to any Environmental
Law, and/or the failure of either Borrower to perform its obligations
and covenants hereunder with respect to environmental matters,
including, but not limited to: (i) claims of any Persons for damages,
penalties, response
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costs, clean-up costs, injunctive or other relief, (ii) costs of
removal and restoration, including fees of attorneys and experts, and
costs of reporting the existence of Hazardous Materials to any
Governmental Body, and (iii) any expenses or obligations, including
attorney's fees and expert witness fees, incurred at, before and after
any trial or other proceeding before any Governmental Body or appeal
therefrom whether or not taxable as costs, including, without
limitation, witness fees, deposition costs, copying and telephone
charges and other expenses, all of which shall be paid by Borrowers to
Agent or such Lender, when incurred by Agent or such Lender.
ARTICLE XIII
MISCELLANEOUS
13.1 NOTICES. All notices and communications under this Loan
Agreement shall be in writing and shall be (i) delivered in person, (ii) sent
by telecopy, or (iii) mailed, postage prepaid, either by registered or
certified mail, return receipt requested, or by overnight express carrier,
addressed in each case as follows:
To Borrowers: c/o Citadel Broadcasting Company
140 South Ash Avenue
Tempe, Arizona 85281
Attention: Donna L. Heffner
Chief Financial Officer
Telecopy No.: (602) 731-5229
Copy (which shall Osborn Maledon
not constitute 2929 North Central Avenue
notice hereunder) to: Suite 2100
Phoenix, Arizona 85012
Attention: Michelle M. Matiski, Esq.
Telecopy No.: (602) 640-6060
and
Eckert Seamans Cherin & Mellott
600 Grant Street
42nd Floor Pittsburgh, Pennsylvania 15219
Attention: Bryan D. Rosenberger, Esq.
Telecopy No.: (412) 566-6099
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To Agent: FINOVA Capital Corporation
311 South Wacker Drive
Suite 4400
Chicago, Illinois 60606
Attention: Matthew M. Breyne
Group Vice President
Telecopy No.: (312) 322-3530
Copy (which shall not FINOVA Capital Corporation
constitute notice 1850 N. Central Avenue
hereunder) to: Phoenix, Arizona 85002-2209
Attention: Vice President, Law
Telecopy No.: (602) 207-5036
Copy (which shall not Katten Muchin & Zavis
constitute notice 525 West Monroe Street, Suite 1600
hereunder) to: Chicago, Illinois 60661
Attention: Maurice Jacobs, Esq.
Telecopy No.: (312) 902-1061
To Any Other Lender: Its address indicated on the signature page
hereto, an Assignment and Acceptance or a
notice to the other parties hereto.
or to any other address or telecopy number, as to any of the parties hereto, as
such party shall designate in a written notice to the other parties hereto. All
notices sent pursuant to the terms of this Section 13.1 shall be deemed
received (i) if personally delivered, then on the Business Day of delivery,
(ii) if sent by telecopy before 2:00 p.m. Chicago time, on the day sent if a
Business Day or if such day is not a Business Day or if sent after 2:00 p.m.
Chicago time, then on the next Business Day, (iii) if sent by overnight,
express carrier, on the next Business Day immediately following the day sent,
or (iv) if sent by registered or certified mail, on the earlier of the fifth
Business Day following the day sent or when actually received. Any notice by
telecopy shall be followed by delivery on the next Business Day by overnight,
express carrier or by hand.
13.2 SURVIVAL OF LOAN AGREEMENT; INDEMNITIES. All covenants,
agreements, representations and warranties made in this Loan Agreement and in
the certificates delivered pursuant hereto shall survive the making by Lender
of the Loans and the execution and delivery to Lenders of the Notes and of all
other Loan Instruments, and shall continue in full force and effect so long as
any of Borrowers' Obligations remain outstanding, unperformed or unpaid.
Notwithstanding the repayment of all amounts due under the Loan Instruments,
the cancellation of the Notes and the release and/or cancellation of any and
all of the Loan Instruments or the foreclosure of any Liens on the Collateral,
the obligations of Borrowers to indemnify Agent and Lenders with respect to the
expenses, damages, losses, costs and liabilities described in
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Section 12.2 shall survive until all applicable statute of limitations periods
with respect to actions which may be brought against Agent or any Lender have
run.
13.3 FURTHER ASSURANCE. From time to time, Borrowers shall
execute and deliver to Agent and Lenders such additional documents as Agent or
such Lenders reasonably may require to carry out the purposes of the Loan
Instruments and to protect the rights of the Agent and Lenders thereunder,
including, without limitation, using their best efforts in the event any
Collateral is to be sold to secure the approval by any Governmental Body of any
application required by such Governmental Body in connection with such sale,
and not take any action inconsistent with such sale or the purposes of the Loan
Instruments.
13.4 TAXES AND FEES. Should any tax (other than taxes based
upon the net income of any Lender), recording or filing fees become payable in
respect of any of the Loan Instruments, or any amendment, modification or
supplement thereof, Borrowers agree to pay the same on demand, together with
any interest or penalties thereon attributable to any delay by Borrowers in
meeting any Lender's demand, and agrees to hold Lenders harmless with respect
thereto.
13.5 SEVERABILITY. In the event that any provision of this Loan
Agreement is deemed to be invalid by reason of the operation of any law,
including, but not limited to, any of the rules and regulations and policies of
the FCC, or by reason of the interpretation placed thereon by any court or the
FCC or any other Governmental Body, as applicable, this Loan Agreement shall be
construed as not containing such provision and the invalidity of such provision
shall not affect the validity of any other provisions hereof, and any and all
other provisions hereof which otherwise are lawful and valid shall remain in
full force and effect.
13.6 WAIVERS AND AMENDMENTS. No delay on the part of Agent or
any Lender in exercising any right, power or privilege hereunder shall operate
as a waiver thereof, and no single or partial exercise of any right, power or
privilege hereunder shall preclude other or further exercise thereof, or be
deemed to establish a custom or course of dealing or performance between the
parties hereto, or preclude the exercise of any other right, power or
privilege. No modification or waiver of any provision of any of the Loan
Instruments shall be effective unless in writing and signed by the Required
Lenders or the Agent on their behalf, except that the written consent of all
the Lenders is required to (i) increase the Commitments; (ii) reduce the
principal of or interest on any Note or any Loan Fee; (iii) postpone any date
fixed for any payment of principal on or interest on any Note or any fee due
hereunder; (iv) amend or waive this Section 13.6, Section 13.9 or the
definition of "Required Lenders"; (v) release Guarantor from its obligations
under the Guaranty; or (vi) release any liens upon the Collateral, except such
release upon the sale of any Collateral in a Permitted Disposition, as
permitted by clause (i) of Section 7.11 and as otherwise expressly provided in
this Loan Agreement.
13.7 JOINT AND SEVERAL LIABILITY. The obligations of the Borrowers
are joint and several.
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13.8 CAPTIONS. The headings in this Loan Agreement are for
purposes of reference only and shall not limit or otherwise affect the meaning
hereof.
13.9 SUCCESSORS AND ASSIGNS. This Loan Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
successors and assigns of the parties hereto, subject to the limitations set
forth in Article X. Borrowers may not assign any of their rights or obligations
hereunder without the consent of all Lenders
13.10 REMEDIES CUMULATIVE. All rights and remedies of Agent and
Lenders pursuant to this Loan Agreement, any other Loan Instruments or
otherwise, shall be cumulative and non-exclusive, and may be exercised
singularly or concurrently. Neither Agent nor any Lender shall be required to
prosecute collection, enforcement or other remedies against any Obligor before
proceeding against any other Obligor or to enforce or resort to any security,
liens, collateral or other rights of Agent or Lenders. One or more successive
actions may be brought against Obligors, either in the same action or in
separate actions, as often as Lenders deem advisable, until all of Borrowers'
Obligations are paid and performed in full.
13.11 ENTIRE AGREEMENT; CONFLICT. This Loan Agreement and the
other Loan Instruments executed prior or pursuant hereto constitute the entire
agreement among the parties hereto with respect to the transactions
contemplated hereby or thereby and supersede any prior agreements, whether
written or oral, relating to the subject matter hereof. In the event of a
conflict between the terms and conditions set forth herein and the terms and
conditions set forth in any other Loan Instrument, the terms and conditions set
forth herein shall govern.
13.12 APPLICABLE LAW. THE LOAN INSTRUMENTS SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS AND DECISIONS OF THE STATE OF ARIZONA.
FOR PURPOSES OF THIS SECTION 13.12, THE LOAN INSTRUMENTS SHALL BE DEEMED TO BE
PERFORMED AND MADE IN THE STATE OF ARIZONA.
13.13 JURISDICTION AND VENUE. BORROWERS HEREBY AGREE THAT ALL
ACTIONS OR PROCEEDINGS INITIATED BY ANY BORROWER AND ARISING DIRECTLY OR
INDIRECTLY OUT OF THE LOAN INSTRUMENTS SHALL BE LITIGATED IN THE SUPERIOR COURT
OF MARICOPA COUNTY, OR THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF
ARIZONA OR, IF AGENT OR ANY LENDER INITIATES SUCH ACTION, IN ADDITION TO THE
FOREGOING COURTS, ANY COURT IN WHICH AGENT OR SUCH LENDER SHALL INITIATE OR TO
WHICH AGENT OR SUCH LENDER SHALL REMOVE SUCH ACTION, TO THE EXTENT SUCH COURT
HAS JURISDICTION. BORROWERS HEREBY EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO
SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED BY AGENT OR ANY LENDER
IN OR REMOVED BY AGENT OR ANY LENDER TO ANY OF SUCH COURTS, AND HEREBY AGREE
THAT PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS
ISSUED THEREIN MAY BE SERVED IN THE MANNER
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PROVIDED FOR NOTICES HEREIN, AND AGREE THAT SERVICE OF SUCH SUMMONS AND
COMPLAINT OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL ADDRESSED TO BORROWERS AT THE ADDRESS TO WHICH NOTICES ARE TO BE SENT
PURSUANT TO SECTION 13.1. BORROWERS WAIVE ANY CLAIM THAT MARICOPA COUNTY,
ARIZONA OR THE DISTRICT OF ARIZONA IS AN INCONVENIENT FORUM OR AN IMPROPER
FORUM BASED ON LACK OF VENUE. TO THE EXTENT PROVIDED BY LAW, SHOULD ANY
BORROWER, AFTER BEING SO SERVED, FAIL TO APPEAR OR ANSWER TO ANY SUMMONS,
COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THE NUMBER OF DAYS PRESCRIBED BY
LAW AFTER THE MAILING THEREOF, SUCH BORROWER SHALL BE DEEMED IN DEFAULT AND AN
ORDER AND/OR JUDGMENT MAY BE ENTERED BY THE COURT AGAINST SUCH BORROWER AS
DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS. THE
EXCLUSIVE CHOICE OF FORUM FOR BORROWERS SET FORTH IN THIS SECTION 13.13 SHALL
NOT BE DEEMED TO PRECLUDE THE ENFORCEMENT BY AGENT OR ANY LENDER OF ANY
JUDGMENT OBTAINED IN ANY OTHER FORUM OR THE TAKING BY AGENT OR ANY LENDER OF
ANY ACTION TO ENFORCE THE SAME IN ANY OTHER APPROPRIATE JURISDICTION, AND
BORROWERS HEREBY WAIVE THE RIGHT TO COLLATERALLY ATTACK ANY SUCH JUDGMENT OR
ACTION.
13.14 WAIVER OF RIGHT TO JURY TRIAL. AGENT, LENDERS AND BORROWERS
ACKNOWLEDGE AND AGREE THAT ANY CONTROVERSY WHICH MAY ARISE UNDER ANY OF THE
LOAN INSTRUMENTS OR WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED THEREBY WOULD
BE BASED UPON DIFFICULT AND COMPLEX ISSUES AND, THEREFORE, THE PARTIES AGREE
THAT ANY LAWSUIT ARISING OUT OF ANY SUCH CONTROVERSY WILL BE TRIED IN A COURT
OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
13.15 TIME OF ESSENCE. TIME IS OF THE ESSENCE FOR THE PERFORMANCE
BY BORROWERS OF THE OBLIGATIONS SET FORTH IN THIS LOAN AGREEMENT AND THE OTHER
LOAN INSTRUMENTS.
13.16 ESTOPPEL CERTIFICATE. Within 15 days after Agent requests
Borrowers to do so, Borrowers will execute and deliver to Agent or such Lender
as Agent may direct a statement certifying (i) that this Loan Agreement is in
full force and effect and has not been modified except as described in such
statement, (ii) the date to which interest on the Notes has been paid, (iii)
the Principal Balance, (iv) whether or not to its knowledge an Event of Default
has occurred and is continuing, and, if so, specifying in reasonable detail
each such Event of Default of which it has knowledge, (v) whether to its
knowledge it has any defense, setoff or counterclaim to the payment of the Note
in accordance with its terms, and, if so, specifying each defense, setoff or
counterclaim of which it has knowledge in reasonable detail (including where
applicable the amount thereof), and (vi) as to any other matter reasonably
requested by Agent.
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13.17 CONSEQUENTIAL DAMAGES. Neither Agent nor any Lender nor
any agent or attorney of Agent or such Lender shall be liable to Borrowers for
consequential damages arising from any breach of contract, tort or other wrong
relating to the establishment, administration or collection of the Borrowers'
Obligations.
13.18 COUNTERPARTS. This Loan Agreement may be executed by the
parties hereto in several counterparts and each such counterpart shall be
deemed to be an original, but all such counterparts shall together constitute
one and the same agreement.
13.19 NO FIDUCIARY RELATIONSHIP. No provision in this Loan
Agreement or in any other Loan Instrument, and no course of dealing among the
parties hereto, shall be deemed to create any fiduciary duty by Agent or any
Lender to Borrowers.
13.20 NOTICE OF BREACH BY AGENT AND LENDERS. Borrowers agree to
give Agent and each Lender written notice of (i) any action or inaction by
Agent or any Lender or any agent or attorney of Agent or such Lender in
connection with the Loan Instruments that may be actionable against Agent or
such Lender or any agent or attorney of Agent or such Lender or (ii) any
defense to the payment of Borrowers' Obligations for any reason, including, but
not limited to, commission of a tort or violation of any contractual duty
implied by law.
13.21 CONFIDENTIALITY. Except as provided for in the Loan
Instruments and except as necessary to enable Lender to realize upon Borrowers'
Obligations and except as necessary in connection with the administration or
enforcement of Agent's and Lenders' rights under the Loan Instruments, neither
Agent nor any Lender shall disclose any information relative to the
Broadcasting Business or Related Business of any Borrower designated by such
Borrower as confidential to any Person without the prior written consent of
such Borrower, except that Agent and Lenders may disclose any such information
(i) in connection with any proposed Loan Assignment or Participation as long as
Agent and Lenders require each of the Persons to whom such information is
disclosed to keep it confidential in accordance with this Section 13.21, (ii)
which otherwise is in the public domain, (iii) to the extent required by
applicable law or any rule, regulation, decree, order or injunction of any
Governmental Body or (iv) which is obtained by Agent or any Lender from a third
party not known to Agent or any Lender to be under an obligation of
confidentiality to Borrowers.
13.22 GOVERNMENTAL APPROVAL. Notwithstanding anything to the
contrary contained herein or in any other Loan Instrument, no party hereto
shall take any action that would constitute or result in the transfer or
assignment of any FCC license, or other license, permit or authority issued by
any Governmental Body, or a transfer of control over any such license, permit
or authorization, if such assignment or transfer would require the prior
approval of and/or notice to any Governmental Body, without such party first
having notified such Governmental Body of any such assignment or transfer and,
if required, obtaining the approval of such Governmental Body therefor.
[remainder of page intentionally blank]
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IN WITNESS WHEREOF, this Loan Agreement has been executed and
delivered by each of the parties hereto by a duly authorized officer of each
such party on the date first set forth above.
CITADEL BROADCASTING COMPANY, a Nevada
corporation, and CITADEL LICENSE, INC.,
a Nevada corporation
By: /s/ Lawrence R. Wilson
------------------------------------
Lawrence R. Wilson
President of each corporation
FINOVA CAPITAL CORPORATION, a Delaware
corporation, individually and as Agent
By: /s/ Matthew M. Breyne
------------------------------------
Matthew M. Breyne
Group Vice President
BANKBOSTON, N.A.
By: /s/ M. S. Denomme
------------------------------------
Name: Mark S. Denomme
------------------------------
Title: Director
-----------------------------
NATIONSBANK OF TEXAS, N.A.
By: /s/ Roselyn Reid
------------------------------------
Name: Roselyn Reid
------------------------------
Title: Vice President
-----------------------------
(Signatures continued on next page)
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(Signatures continued from previous page)
THE BANK OF NEW YORK
By: /s/ Geoffrey Brooks
---------------------------------
Name: Geoffrey C. Brooks
---------------------------
Title: Vice President
--------------------------
UNION BANK OF CALIFORNIA, N.A.
By: /s/ Bryan G. Peterman
---------------------------------
Name: Bryan G. Peterman
---------------------------
Title: Vice President
--------------------------
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