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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 17, 1996
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Saga Communications, Inc.
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(Exact Name of Registrant as Specified in Its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
1-11588 38-3042953
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(Commission File Number) (IRS Employer Identification No.)
73 Kercheval Avenue, Grosse Pointe Farms, Michigan 48236
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(Address of Principal Executive Offices) (Zip Code)
(313) 886-7070
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(Registrant's Telephone Number, Including Area Code)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
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On June 18, 1996, Saga Communications, Inc. (the "Registrant"), through its
wholly-owned subsidiary Saga Communications of New England, Inc. ("SCNE"),
acquired from Ocean Coast Properties ("OC"), a Maine corporation (the "Seller"),
substantially all of the assets of radio stations WPOR AM/FM (the "Stations"),
licensed to Portland, Maine. As of June 19, 1996, the Registrant owns one
television station and 28 radio stations consisting of 17 FM and 11 AM radio
stations.
The acquisition price for the assets was approximately $10,000,000. The
principal source of funds used to acquire the radio stations was borrowings
under the Registrant's $54,000,000 senior secured term loan credit facility
entered into on June 17, 1996 with The First National Bank of Boston; The Bank
of New York, Fleet Bank, N.A., Mellon Bank, N.A., and Union Bank of California,
N.A. (See item 5 below.)
SCNE will utilize the FCC broadcast licenses, broadcast tower, antenna,
transmitter and real property acquired from the Seller in a manner similar to
that previously utilized by the Seller.
The Asset Purchase Agreement and Press Release are attached hereto as
Exhibits and incorporated herein by reference. The foregoing summary of the such
exhibits is qualified in its entirety by reference to the complete text of such
exhibits.
ITEM 5. OTHER EVENTS
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On June 17, 1996, the Registrant entered into an agreement (the "Credit
Agreement") with The First National Bank of Boston; The Bank of New York, Fleet
Bank, N.A., Mellon Bank, N.A., and Union Bank of California; N.A. (collectively
the "lenders"), to refinance the Company's financing facilities with two
facilities (the "Facilities"): a $54,000,000 senior secured term loan (the "Term
Loan") and a $56,000,000 senior secured reducing revolving/term loan facility
(the "Revolving Loan"). The facilities mature June 30, 2003. The Company's
indebtedness under the Facilities is secured by a first priority lien on
substantially all the assets of the Registrant and its subsidiaries, by a pledge
of its subsidiaries stock and by a guarantee of its subsidiaries.
The Term Loan was used to refinance the Company's existing bank
indebtedness, and to principally finance the acquisition of WPOR AM/FM (item 2
above). The Revolving Loan, of which $51,000,000 may be used for permitted
acquisitions and related transaction expenses, and $5,000,000 may be used for
working capital needs and stand-by letters of credit.
2
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The Amended and Restated Credit Agreement and Press Release are attached
hereto as Exhibits and incorporated herein by reference. The foregoing summary
of such exhibits is qualified in its entirety by reference to the complete
text of such exhibits.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
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(a) Financial Statements of Business Acquired
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Ocean Coast Properties:
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Report of Independent Auditors
Balance Sheets at December 31, 1995 and December 25, 1994
Statements of Earnings and Retained Earnings for the years ended
December 31, 1995 and December 25, 1994
Statement of Cash Flows for the years ended December 31, 1995 and
December 25, 1994
Notes to Financial Statements
Unaudited Condensed Balance Sheet at March 31, 1996
Unaudited Condensed Statement of Operations for the three month
periods ended March 31, 1996 and 1995
Unaudited Condensed Statement of Cash Flows for the three month
periods ended March 31, 1996 and 1995
Notes to Unaudited Financial Statements
(b) Pro Forma Financial Statements
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Pro Forma Combined Condensed Financial Statements (Unaudited):
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Unaudited Pro Forma Combined Condensed Balance Sheet at
March 31, 1996
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Unaudited Pro Forma Combined Condensed Statement of Operations For
the year ended December 31, 1995 and the three month period ended
March 31, 1996
Notes to Pro Forma Combined Condensed Financial Statements
(Unaudited)
(c) Exhibits
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See exhibit index annexed hereto.
(d) It is impracticable for the Registrant to provide the required
historical and pro forma financial statements at this time. The
Registrant undertakes to file such required financial statements
when such statements are available. The required financial
statements will be filed not later than August 13, 1996.
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Exhibit Index
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Item 601
Exhibit
Table
Reference Exhibit Title
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(2) Asset Purchase Agreement dated as of March 7, 1996 by and
between Saga Communications of New England, Inc. and Ocean
Coast Properties.
(4) Amended and Restated Credit Agreement dated as of
June 17, 1996 by and between Saga Communications, Inc. and
The First National Bank of Boston; The Bank of New York,
Fleet Bank, N.A., Mellon Bank, N.A., and Union Bank of
California, N.A.
(23) Consent of Baker Newman & Noyes LLC *
(99) Press Release dated June 24, 1996
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* To be filed on or prior to August 13, 1996.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
SAGA COMMUNICATIONS, INC.
Registrant
By: /s/ Norman L. McKee
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Norman L. McKee
Senior Vice President, Chief
Financial Officer and Treasurer
Dated: July 2, 1996
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EXHIBIT 2
ASSET PURCHASE AGREEMENT
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AGREEMENT entered into as of the 7th day of March, 1996, by SAGA
COMMUNICATIONS OF NEW ENGLAND, INC., a Delaware corporation with a mailing
address at 73 Kercheval Avenue, Grosse Pointe Farms, MI 48236 ("Buyer"), OCEAN
COAST PROPERTIES, a Maine corporation with a mailing address at 15 Baxter
Boulevard, Portland, Maine 04101 ("SELLER"). Certain capitalized terms defined
herein are indexed in Section 9 hereof.
RECITALS:
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WHEREAS, Seller is the licensee and operator of Radio Stations WPOR(AM) and
WPOR-FM, licensed to Portland, Maine (collectively, the "STATIONS"), holding
valid authorizations for the operation thereof from the Federal Communications
Commission (together with any successor thereto, the "FCC"), and Seller is the
owner of all of the tangible and intangible property used in connection with the
operation of the Stations; and
WHEREAS, Seller desires to sell, and Buyer desires to purchase,
substantially all of the properties and assets used or useful in connection with
the operation of the Stations, all subject to the terms and conditions set forth
herein; and
WHEREAS, concurrently herewith Buyer is entering into an employment
agreement with Robert J. Gold, pursuant to which Robert J. Gold shall serve as
the general manager of the Stations (the "EMPLOYMENT AGREEMENT").
NOW, THEREFORE, in consideration of the mutual agreements and covenants
herein, the parties agree as follows:
SECTION 1. PURCHASE AND SALE OF ASSETS
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1.1. SALE OF ASSETS. (a) Subject to the provisions of this Agreement,
Seller agrees to sell, convey, transfer, assign and deliver to Buyer, and Buyer
agrees to purchase and accept from Seller, on the Closing Date (as defined in
Section 1.4 hereof), all of the assets and rights of every kind and nature,
real, personal, and mixed, tangible and intangible, now or hereafter owned by
Seller or in which Seller now or hereafter has an interest which are used or
usable in, or arising from, the operation of the Stations, including all such
assets and rights acquired by Seller or arising between the date hereof and the
Closing Date (but excluding any
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Excluded Property, as defined in Section 1.1(b)), and including, without
limitation, the following:
(i) All tangible personal property and physical assets wherever
located (collectively, the "TANGIBLE ASSETS"), including, without
limitation, the assets described in the Schedule of Tangible Assets
attached hereto as SCHEDULE 1.1(a)(i);
(ii) All governmental licenses, franchises, approvals,
certificates, authorizations, permits and rights and applications therefor
(collectively, the "LICENSES"), including, without limitation, the Licenses
described in the Schedule of Licenses attached hereto as SCHEDULE
1.1(a)(ii);
(iii) All real estate, including all buildings and improvements
thereon, described in the Schedule of Real Estate attached hereto as
SCHEDULE 1.1(a)(iii) (the "REAL ESTATE");
(iv) The real estate leases (the "REAL ESTATE LEASES"), the
equipment leases, towers, syndication agreements, programming and other
contracts relating to the Stations described in the Schedule of Contracts
attached hereto as SCHEDULE 1.1(a)(iv); all agreements for the sale of
advertising time on the Stations for cash, billed at rates consistent with
Seller's past practices; the agreements for the sale of advertising time on
the Stations at rates then charged to unaffiliated third parties consistent
with Seller's past practices in exchange for merchandise or services
(collectively, "TRADE-OUT AGREEMENTS") specified as such on SCHEDULE
1.1(a)(iv) (collectively, the "ASSUMED TRADE-OUT AGREEMENTS"); such other
contracts, business agreements, leases and arrangements existing on the
Closing Date and entered into by Seller with persons or entities other than
its affiliates, in the ordinary course of business consistent with past
practices between the date hereof and the Closing Date which in the
aggregate involve consideration payable or receivable not in excess of
$10,000; and those additional contracts, business agreements, leases and
arrangements used or usable in the operation of the Stations which are not
specifically disclosed in this Agreement or the Schedules hereto or which
are entered into by Seller between the date hereof and the Closing Date
which, in either case, Buyer may, in its discretion, agree in writing to
assume (all of the foregoing, including the Assumed Trade-Out Agreements,
being herein collectively referred to as the "ASSUMED CONTRACTS");
(v) Originals or, if originals are unavailable, copies of
Seller's files, books, and records relating to the Subject Assets (as
hereinafter defined), including, without limitation, tapes, computer disks
and electronic data processing software used or usable in the operation of
the Stations, accounting journals and ledgers, FCC filings, customer lists,
and Station log books;
(vi) All of Seller's rights in and to all copyrights, logos,
trademarks, service marks, trade names, current slogans, jingles, computer
programs to the extent
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owned by Seller or its affiliates, non-governmental licenses, intellectual
property, and other intangible property rights owned by, or licensed or
franchised to, Seller and used by the Stations, including those described
in the Schedule of Intangible Assets attached hereto as SCHEDULE
1.1(a)(vi);
(vii) All of Seller's rights and interests to the use of the call
letters of each of the Stations as call letters or as part of a tradename;
(viii) All goodwill relating to the Stations; and
(ix) All non-cash accounts receivable in respect of Assumed
Trade-Out Agreements.
(b) There shall, however, be excluded from such purchase and sale the
following property owned by Seller (the "EXCLUDED PROPERTY"):
(i) Cash accounts receivable, notes receivable, cash and cash
equivalents or money market instruments, including unprocessed checks,
savings and other deposits and certificates of deposit, all as the same may
exist as of the Closing, subject to the provisions of clause (iv) below;
(ii) Seller's corporate franchise, stock record books, corporate
record books, including minutes of meetings of directors and stockholders,
and such other records as deal exclusively with Seller's organization or
stock capitalization; and
(iii) All other assets of Seller which are described in the
Schedule of Excluded Property attached hereto as SCHEDULE 1.1(b).
(iv) Assets sold by Seller following the date hereof and prior to
the Closing Date in accordance with the provisions of this Agreement;
provided, however, that, any proceeds of such sales shall not constitute
Excluded Property.
(c) The assets of the Seller to be sold to and purchased by the Buyer
under this Agreement are hereinafter collectively referred to as the
"SUBJECT ASSETS."
1.2. ASSUMPTION OF LIABILITIES. Upon the sale and purchase of the Subject
Assets, Buyer shall assume (a) Seller's obligations to be performed after 12:01
A.M. on the Closing Date (but not obligations or liabilities the Seller's
performance or payment of which was due prior to such time) under the Assumed
Contracts and (b) Seller's obligations described in the Schedule of Assumed
Liabilities attached hereto as SCHEDULE 1.2 (all of the obligations referred to
in the foregoing clauses (a) and (b) being herein referred to collectively as
the "ASSUMED LIABILITIES"). Except as provided in the preceding sentence and
Section l.3(c), Buyer is not agreeing to, and shall not, assume any other
liability, obligation, undertaking, expense or agreement of Seller of any kind,
absolute or contingent, known or unknown, and
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the execution, delivery and performance of this Agreement shall not render Buyer
liable for any such liability, obligation, undertaking, expense or agreement.
Without limiting the generality of the foregoing, it is understood and agreed
that Buyer is not agreeing to, and shall not, assume any liability or obligation
of Seller to Seller's employees under any existing written or oral agreements
with Seller, including any such liability or obligation in respect of wages,
salaries, bonuses, accrued vacation or sick pay or any other matter other than
liabilities and obligations arising following the Closing under such employment
agreements, if any, as constitute Assumed Contracts. Seller covenants and agrees
to pay when due prior to and following the Closing all of Seller's debts,
liabilities and other obligations to trade creditors and employees except to the
extent such debts, liabilities and obligations shall have been expressly assumed
by Buyer in writing at the Closing.
1.3. PURCHASE PRICE. The total purchase price for the Subject Assets shall
be Ten Million Dollars ($10,000,000), subject to adjustment as provided in
Section 1.3(c) (the "PURCHASE PRICE"). Payment of the Purchase Price for the
Subject Assets shall be made as follows:
(a) ESCROW DEPOSIT. Simultaneously with the execution of this
Agreement, Buyer is delivering to Gary Stevens & Company, Inc. (the "ESCROW
AGENT") Five Hundred Thousand Dollars ($500,000) as a deposit (the
"DEPOSIT") to secure Buyer's performance hereunder, and to be held by the
Escrow Agent pursuant to the terms of the Escrow Agreement executed on the
date hereof by and among Buyer, Seller and the Escrow Agent (the "ESCROW
AGREEMENT").
(b) POST-CLOSING ESCROW DEPOSIT. On the Closing Date, Buyer shall
cause to be paid in immediately available funds by wire transfer to a bank
account designated in writing by Seller at least one day prior to the
Closing Date a portion of the Purchase Price equal to Nine Million Five
Hundred Thousand Dollars ($9,500,000). The Five Hundred Thousand Dollar
($500,000) Deposit, constituting the balance of the Purchase Price, will be
retained by the Escrow Agent as security for Seller's obligations to Buyer
following the Closing pursuant to the terms of the Escrow Agreement (the
"POST-CLOSING ESCROW"). Pursuant to the Escrow Agreement, (i) six months
following the Closing, $250,000 of the Post-Closing Escrow together with
the earnings thereon less the amount of any asserted indemnification claims
shall be released from the Post-Closing Escrow and paid to Seller; and (ii)
twelve months following the Closing the balance of the Post-Closing Escrow
together with the earnings thereon less the amount of any then asserted
indemnification claims shall be released from the Post-Closing Escrow and
paid to Seller.
(c) DISPOSITION OF ESCROW DEPOSIT; LIQUIDATED DAMAGES. On the Closing
Date, the earnings on the Deposit shall be paid to the Buyer by wire
transfer of immediately available funds. If the Closing does not occur
because of a breach by Buyer of its representations and warranties
hereunder or of the covenants and obligations to be performed by the Buyer
hereunder, provided Seller has satisfied its obligations hereunder, unless
prevented from doing so by the Buyer's breach, and provided further, that
the conditions set
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forth in Sections 6.1 and 6.2 of this Agreement have been satisfied, then,
pursuant to the Escrow Agreement, the Deposit and earnings thereon shall be
delivered to Seller as liquidated damages, which shall be the sole remedy
of Seller for such breach, and Seller shall have no other recourse against
Buyer or any of its affiliates under or on account of this Agreement. In
any other case, if the Closing does not occur and this Agreement is
terminated, then, pursuant to the Escrow Agreement, the Deposit and
earnings thereon shall be delivered to Buyer. All payments by the Escrow
Agent shall be made in accordance with the procedures and provisions set
forth in the Escrow Agreement.
(d) PRORATION. The operating income and expenses of the Stations shall
be prorated between Buyer and Seller as of 12:01 A.M. on the Closing Date,
and the net amount thereof shall be paid to the Seller or the Buyer, as
appropriate. Such prorations shall include, without limitation, all AD
VALOREM, real estate, and other property taxes, water and sewer use
charges, business and license fees, pre-paid fees and expenses, rents,
utility expenses, Assumed Contracts, prepaid Trade-Out Agreements and
prepaid time sale agreements, but shall exclude (i) wages, salaries,
bonuses, accrued vacation and sick pay and any other obligations of Seller
to its employees, other than pursuant to such employment agreements, if
any, as constitute Assumed Contracts, (ii) all of the Assumed Liabilities
listed on SCHEDULE 1.2, (iii) legal and professional fees and closing
costs; and (iv) financing costs, capital expenditures, and other costs and
expenses not pertaining to the day-to-day operations of the Stations.
Revenues, expenses, costs and liabilities earned or incurred in particular
programs and announcements shall be allocated to the time of performance of
such programs and announcements without regard to the date of payment
therefor. However, Seller shall be entitled to all income, and shall be
responsible for all expenses, arising out of contracts, agreements and
commitments to which Seller is a party other than Assumed Contracts. Seller
shall provide Buyer with an itemized statement evidencing all proposed
adjustments not less than three (3) business days prior to the Closing
Date.
If the amount of any of the aforesaid taxes is not known at the
Closing Date, the same shall be apportioned on the basis of taxes assessed
for the preceding year, with a reapportionment as soon as the new tax rate
and valuation can be ascertained; and, if the taxes which are to be
apportioned shall thereafter be reduced by abatement, the amount of such
abatement, less the reasonable cost of obtaining the same, shall also be
apportioned between Buyer and Seller, provided that no party shall be
obligated to institute proceedings for an abatement. All other prorations
shall, to the extent feasible, be determined and paid on the Closing Date,
with a final settlement thereof to be made within sixty (60) days after the
Closing Date.
Any item for which a party receives credit from the other party under
this Section l.3 shall be paid when due in accordance with its terms by the
party so receiving credit.
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(e) ALLOCATION OF PURCHASE PRICE. Buyer and Seller agree that the
Purchase Price shall be allocated among the Subject Assets prior to the
Closing Date and to cooperate in all respects with regard to such
allocation. Buyer and Seller agree to use such allocation on completing and
filing Internal Revenue Service Form 8594 for federal income tax purposes.
Buyer and Seller further agree that they shall not take any position
inconsistent with such allocation upon examination of any return, in any
refund claim, in any litigation, or otherwise. If Buyer and Seller are
unable to agree to such allocation, they shall hire an appraiser to make
such allocation, the cost of which appraisal shall be borne equally by
Seller and Buyer.
1.4. TIME AND PLACE OF CLOSING. The closing of the purchase and sale
provided for in this Agreement (herein referred to as the "CLOSING") shall be
held at a place and date mutually agreed to in writing by the parties or, absent
such mutual agreement, at the offices of Verrill & Dana, One Portland Square,
Portland, Maine on the first business day following the satisfaction or, if
applicable, waiver of the applicable conditions precedent set forth in Section
6.1(a) hereof (in either case, the "CLOSING DATE"). In the event such date falls
on a day upon which banks in Maine, Massachusetts or New York or public offices
in Maine are closed, the Closing Date shall be deemed to mean the next day upon
which such banks or public offices are open. If all such applicable conditions
precedent set forth in Section 6.1(a) have not been satisfied on or before
December 31, 1996 then either Buyer or Seller may terminate this Agreement, by
written notice to the other given prior to the time that such conditions are
satisfied, provided that the party giving such notice is not in breach of this
Agreement. Upon such termination the Deposit shall be delivered to Buyer and the
Escrow Agreement shall be terminated.
1.5. CLOSING. At the Closing:
(a) Seller shall convey, transfer, and assign to Buyer, and shall
deliver to Buyer such instruments of conveyance, transfer, and assignment,
in form and substance reasonably satisfactory to Buyer and its counsel (the
"TRANSFER INSTRUMENTS"), and any required consents of third parties, as
shall be sufficient to convey, transfer and assign to Buyer (i) sole and
exclusive right, title and interest in and to all the Subject Assets other
than the Real Estate and (ii) good and clear marketable title to the Real
Estate in fee simple, in each case free and clear of all liens, pledges,
encumbrances and claims of third parties, except for (x) liens for taxes
and assessments in respect of the Real Estate not yet due and payable and
for which a proration has been made pursuant to Section 1.3; and (y)
easements, restrictions and encumbrances specifically designated in the
Schedule of Encumbrances attached hereto as SCHEDULE 1.5 as continuing
following the Closing, such instruments to include quit claim deeds with
covenant to the Real Estate and bills of sale with covenant with respect to
the other Assets, in each case in form consistent with the terms of this
Agreement;
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(b) Buyer shall deliver to Seller the Purchase Price less the
Post-Closing Escrow, as set forth in Section 1.3 hereof;
(c) Buyer shall assume the Assumed Liabilities pursuant to instruments
of assumption in form and substance reasonably satisfactory to Seller and
its counsel (the "ASSUMPTION AGREEMENT");
(d) Seller shall cause to be delivered the opinions, certificates and
other documents required to be delivered pursuant to this Agreement;
(e) Ocean Coast Properties shall execute and delivery to Buyer the
Non-Compete Agreement in the form attached hereto as Schedule 1.5(f) (the
"NON-COMPETE AGREEMENT"); and
(f) Seller shall deliver to Buyer all of Seller's files and records
which relate to the Subject Assets, including, without limitation, all log
books relating to the Stations, and Seller shall put Buyer in actual
possession of the Subject Assets and such files and records.
1.6. COVENANTS TO BE PERFORMED AFTER THE CLOSING. After the Closing, each
of Seller and Buyer shall, from time to time upon the other party's request,
execute, acknowledge and deliver, or cause to be executed, acknowledged, and
delivered, all such further deeds, assignments, documents, instruments,
transfers, conveyances, discharges, releases, assurances and consents, and to
take or cause to be taken such further actions, as such other party may
reasonably request to carry out the transactions contemplated by, and the
purposes of, this Agreement. After the Closing, each of Seller and Buyer shall
allow the other party reasonable access, upon reasonable notice and during
normal business hours, to such of the files and records (including financial
records) as relate to the Subject Assets or the Stations for purposes of
preparing such party's tax returns, securities filings and for all other proper
purposes, and shall give such other party at least thirty (30) days' prior
written notice of any proposed destruction thereof, upon which notice such other
party shall have the right to take possession of such files and records for the
foregoing purposes. In the event Buyer determines it to be necessary or
appropriate for purposes of facilitating securities law filings prior to or
following the Closing, Buyer shall have the right, at Buyer's expense, to
conduct an audit of Seller's financial condition, and Seller shall cooperate
with Buyer in connection with such audit.
1.7. ACCOUNTS RECEIVABLE. The parties hereto acknowledge that Seller's cash
accounts receivable are not among the Subject Assets being transferred to Buyer
pursuant to the terms hereof. However, for a period of 120 days after the
Closing Date (the "COLLECTION PERIOD") Buyer shall use reasonable efforts
(limited to including such cash accounts receivable in the Stations' billing
statements and accepting payments) to collect such cash accounts receivable. In
the event that Buyer and Seller each has an account receivable of the same
debtor, any amounts received by Buyer from such debtor shall be applied first as
a
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payment on Seller's account receivable except to the extent the debtor disputes
the validity of such Seller account receivable. Buyer shall, within five (5)
business days after the expiration of the first 60 days of the Collection Period
and within five (5) business days after the expiration of the Collection Period,
remit to Seller all amounts collected by Buyer hereunder, net of any sales
commissions, agency or national representative fees or similar amounts
reasonably determined by Buyer to be payable in connection with cash accounts
receivable collected on Seller's behalf. Collection of said cash accounts
receivable shall be the sole responsibility of Seller upon the expiration of the
Collection Period.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF SELLER
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In order to induce Buyer to enter into this Agreement, Seller represents
and warrants to Buyer that:
2.1. ORGANIZATION AND QUALIFICATION OF SELLER. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Maine and is duly qualified to transact business in Maine and in every other
jurisdiction in which the nature of its business or the ownership or leasing of
its properties requires such qualification.
2.2. AUTHORITY OF SELLER. Seller has the corporate power and authority to
execute, deliver and perform this Agreement, the Escrow Agreement, the
Non-Compete Agreement, the Transfer Instruments and all other agreements,
documents and instruments to be executed and delivered by Seller pursuant hereto
(collectively, the "SELLER AGREEMENTS") and to own the Subject Assets and
operate the Stations prior to the consummation of the transactions contemplated
hereby. Seller has taken all necessary corporate action to authorize the
execution, delivery and performance by Seller of this Agreement and the Seller
Agreements.
2.3. BINDING EFFECT. This Agreement and the Escrow Agreement constitute,
and upon execution on the Closing Date the other Seller Agreements will
constitute, the legal, valid, and binding obligations of Seller enforceable in
accordance with their terms.
2.4. NO VIOLATION. Neither the execution and delivery by Seller of this
Agreement and the Seller Agreements, nor the consummation of the transactions
contemplated hereby or thereby, violate or will violate any provision of law or
any order, judgment or decree of any court or other agency of government,
including, without limitation, the FCC, or any provision of the corporate
charter or by-laws of Seller, or conflict with or will result in any breach of
any term, condition or provision of, or constitute or will constitute (with due
notice or lapse of time or both) a default under, or will result in the creation
or imposition of any lien, charge or encumbrance upon any of the properties or
assets of Seller pursuant to the terms of, any mortgage, deed of trust or other
agreement or instrument to which Seller is a party or by which or to which
Seller or any of its assets are subject or bound.
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2.5. Title to Properties; Liens; Condition of Properties.
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(a) SCHEDULE 1.1(a)(iii), the Schedule of Real Estate, contains an
accurate legal description of all Real Estate owned and all real estate
leased under the Real Estate Leases (the "LEASED REAL ESTATE") by Seller.
All Real Estate Leases and all leases of personal property to which Seller
is a party are valid, binding and enforceable against Seller and, to the
best of Seller's knowledge, all other parties thereto in accordance with
their terms, and neither Seller nor, to the best of Seller's knowledge, any
other party thereto is in default thereunder. All of the towers, guy
anchors, ground systems and buildings relating to the Stations are located
on the Real Estate or the Leased Real Estate. The Subject Assets include
all of the property and property rights used or useful in the operation of
the Stations as presently conducted and are in compliance in all material
respects with all applicable laws and regulations. SCHEDULE 1.1(a)(i)
includes all tangible personal property, physical assets and equipment of
all types located at, or used by, the Stations, all of which are owned
solely by Seller. Seller owns the sole and exclusive right, title and
interest in and to all Subject Assets free and clear of all security
interests, mortgages, pledges, liens, conditional sales agreements, leases,
encumbrances, easements, charges or claims of third parties of any nature
whatsoever, except as set forth in SCHEDULE 1.5, all of which (other than
those specifically designated as continuing following the Closing) shall be
released or discharged at or prior to the Closing.
(b) All Real Estate and all Tangible Assets of Seller, and Seller's
use of the same, (i) comply in all material respects with all applicable
ordinances and regulations and building or other laws, and (ii) meet, and
will as of the Closing Date meet in all material respects, the
requirements, standards, rules and regulations of the FCC and of all
Licenses.
(c) Seller's use of the Leased Real Estate, and to the best of
Seller's knowledge, without investigation, all Leased Real Estate and use
of the same, (i) comply in all material respects with all applicable
ordinances and regulations and building or other laws, and (ii) meet, and
will as of the Closing Date meet in all material respects, the
requirements, standards, rules and regulations of the FCC and of all
Licenses.
(d) The transmitters for the Stations are operating in accordance with
and within the parameters established by the FCC and the Stations'
Licenses. The broadcast towers for the Stations are in compliance in all
material respects with all applicable laws, including, without limitation,
the Federal Aviation Act and all rules and regulations promulgated
thereunder. The Tangible Assets being conveyed pursuant to this Agreement
are, and at the Closing will be, in good operating condition and repair and
suitable for use in the operation of the Stations; provided, however, that
certain minor spare parts of immaterial value may not be in good operating
condition.
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(e) Seller has access to all Real Estate and Leased Real Estate
pursuant to valid easements included as part of the Subject Assets or
pursuant to public rights of way. All utilities servicing the Stations have
access to the properties of the Stations pursuant to valid easements or
public rights of way. No condemnation proceedings are pending or threatened
with respect to any of the Real Estate, nor has any such property been
condemned. To Seller's knowledge, without investigation, no condemnation
proceedings are pending or threatened with respect to any of the Leased
Real Estate, nor has any such property been condemned.
2.6. TAX MATTERS. All federal, state, county and local tax returns, reports
and declarations of estimated tax or estimated tax deposit forms required to be
filed by Seller in connection with its operations, personal property or payroll
have been duly and timely filed (after taking into account any extensions
therefor); Seller has paid all taxes which have become due pursuant to such
returns or pursuant to any assessment received by it, and has paid all
installments of estimated taxes due; and all taxes, levies and other assessments
which Seller is required by law to withhold or to collect have been duly
withheld and collected, and have been paid over to the proper governmental
authorities or are held by Seller for such payment.
2.7. LICENSES. The Licenses constitute all licenses, permits and
governmental authorizations and approvals necessary for the operation of the
Stations. Seller has duly obtained and legally and validly holds all Licenses,
all of which are valid and in full force and effect as presently operated. No
proceeding (judicial, administrative or otherwise) has been commenced or, to
Seller's knowledge, threatened against Seller, any of its affiliates, any
Station or in respect of any License which could lead to a revocation,
suspension or limitation of the rights under any License. Seller is in
compliance in all material respects with each of the Licenses and knows of no
state of facts relating to Seller, its affiliates, the Stations or the Licenses
which could lead to any such revocation, suspension or limitation thereof.
SCHEDULE 1.1(a)(ii) sets forth the expiration dates of each of the Licenses
listed thereon, and Seller has no reason to believe that any License listed on
such Schedule will not be renewed, nor has any person or entity informed Seller
that such person or entity intends to oppose any such renewal. Seller has
delivered to Buyer true and complete copies of each of the Licenses listed on
SCHEDULE 1.1(a)(ii).
2.8. FINANCIAL CONDITION OF SELLER.
(a) Seller has heretofore delivered to Buyer the financial statements
and information described in the Schedule of Financial Statements attached
hereto as SCHEDULE 2.8 (the financial statements referred to in said
Schedule, together with the monthly financial statements required to be
furnished pursuant to Section 3.3 being hereinafter collectively referred
to as the "FINANCIAL STATEMENTS"). The Financial Statements have been or,
in the case of those to be provided after the date hereof, will be prepared
by Seller in accordance with generally accepted accounting principles,
consistently applied and fairly present the financial condition and results
of operations
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of each Station for the periods covered thereby (subject, in the case of
interim Financial Statements, to normal year-end adjustments and the
absence of footnotes).
(b) Except as otherwise disclosed in SCHEDULE 2.8, between December
31, 1995 and the date of this Agreement, there has been no change in the
condition (financial or otherwise), results of operations, business, assets
or profits of any Station which, individually or in the aggregate, is, or
would be likely in the future to be, materially adverse to such Station's
condition, results of operations, business, assets or profits.
2.9. COMPLIANCE WITH LAWS; COMPLIANCE WITH FCC REGULATION.
(a) Seller has complied in all material respects with all laws,
regulations and orders and all requirements of insurance carriers
applicable to the Stations, and the present uses by Seller of the Stations'
assets and properties do not violate any such laws, regulations, orders or
requirements. Seller is not in default with respect to any judgment, order,
injunction or decree of any court, administrative agency, board of
arbitration or other governmental authority. Seller is not charged with, or
to its knowledge threatened with, a charge of or under investigation with
respect to, any violation of any provision of any federal, state, local or
municipal law or administrative ruling or regulation relating to either
Station.
(b) The operation of the Stations and all of the Subject Assets are in
compliance in all material respects with (i) all applicable engineering
standards required to be met under applicable FCC rules, and (ii) all other
applicable federal, state and local rules, regulations, requirements and
policies, including all applicable FCC rules.
2.10. COPYRIGHTS, PATENTS, TRADEMARKS, OTHER INTANGIBLES. SCHEDULE
1.1(a)(vi) lists all copyrights, patents, trademarks, service marks, trade
names, current slogans, logos, jingles, computer programs, program rights,
non-governmental licenses or other intangible property rights owned by, or
licensed or franchised to or used by, Seller and used by the Stations, all of
which are in good standing and uncontested. Seller has no knowledge of any
infringement or unlawful or unauthorized use of such property and, to the best
of Seller's knowledge, the operations of the Stations do not infringe, and no
one has asserted to Seller that such operations infringe upon, any copyright,
patent, trademark, tradename, service mark or other similar right of any other
party.
2.11. CONTRACTS.
(a) SCHEDULE 1.1(a)(iv) contains a true and complete description of
all existing Assumed Trade-Out Agreements, including the dollar amount of
the broadcasting time (computed at billing rates currently charged to
unaffiliated third parties
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<PAGE> 12
consistent with Seller's past practices) owed by either Station under each
such agreement as of the date of this Agreement.
(b) Seller has delivered to Buyer complete and correct copies of all
the Assumed Contracts listed on SCHEDULE 1.1(a)(iv) (including all
amendments thereto and modifications thereof). Except for the Assumed
Contracts and any contracts listed on SCHEDULE 1.1(b) which Buyer has not
agreed to assume, Seller is not a party to any contracts, agreements or
arrangements, written or oral, express or implied, which are material to
the operation of either Station.
(c) Seller is not a party to, or bound by or negotiating any
collective bargaining agreement affecting either Station, nor is it aware
of any current solicitations of its employees with respect thereto.
(d) Seller and, to the best of Seller's knowledge, each other party
thereto have complied with all respective provisions of the Assumed
Contracts required to be complied with by them and neither Seller nor, to
the best of Seller's knowledge, any such other party is in default in any
respect thereunder, and no event has occurred which, but for the passage of
time or giving of notice or both would or might constitute such a default
thereunder by Seller or any such other party, and there is no outstanding
notice of default or termination under any Assumed Contract. The Assumed
Contracts are valid, binding and enforceable in accordance with their
respective terms and the sale of the Subject Assets as contemplated herein
will in no way affect the validity, enforceability and continuity of any
such contracts or agreements if properly assigned to Buyer as contemplated
hereby.
2.12. LITIGATION. Except as disclosed in SCHEDULE 2.12 and except for
investigations and rule making proceedings affecting the radio broadcasting
industry generally, there is no litigation, action, suit, investigation or
proceeding pending or, to the best of Seller's knowledge, threatened against
Seller, any of its affiliates or the Stations or in respect of the Licenses
before or by any court or the FCC or any other governmental agency or any board
of arbitration. None of the matters disclosed in Schedule 2.12 could (a) give
rise to any material claim against any of the Subject Assets, (b) impair
Seller's ability to perform its obligations under this Agreement, or (c) in any
way adversely affect Buyer's ability to continue to operate the Stations as
heretofore operated.
2.13. EMPLOYEE INFORMATION. Seller has heretofore delivered to Buyer: (i)
accurate information pertaining to all persons employed at each Station and
their present positions and start dates; (ii) all compensation arrangements
respecting those employees subject to an employment agreement previously
delivered to Buyer; and (iii) copies of the Blue Cross Blue Shield and The
United States Life Insurance Company employee benefit plans in which all
full-time employees of each Station are entitled to participate. The Seller
neither maintains, participates in, nor is subject to an employee pension plan
(as such term is defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended).
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2.14. MATERIAL FACTS. No representation or warranty made by Seller in this
Agreement and no statement made by Seller (a) in any certificate, exhibit,
schedule, or other writing executed and delivered by Seller, (b) in any Seller
Agreement or other document or writing furnished in connection with the
transactions herein contemplated and referred to herein or in the Schedules
attached hereto, or (c) in any document or other writing delivered to Buyer
after the date hereof and on or prior to the Closing Date by or on behalf of
Seller, contains or will contain any untrue statement of a material fact, or
omits or will omit to state any material fact necessary in order to make the
statements contained herein or therein not misleading.
2.15. BROKER'S FEE. Seller has not incurred or become liable for any
broker's commission or finder's fee relating to the transactions contemplated by
this Agreement. Seller agrees to indemnify and hold Buyer harmless from any
claims for brokerage fees, finder's fees or commissions asserted by any person
acting on Seller's behalf in connection with this transaction.
2.16. CONSENTS. Other than the consents and approvals of the FCC referred
to in Section 3.1, consents of third parties to Assumed Contracts specified on
SCHEDULE 1.1(a)(iv), and other consents and filings contemplated by this
Agreement or otherwise obtained or completed at or prior to the Closing, Seller
is not required to obtain any consent, approval or authorization from, or to
file any declaration or statement with, any governmental instrumentality or
other agency or any third party in connection with the execution of this
Agreement or any of the Seller Agreements or the consummation of the
transactions contemplated hereunder.
2.17. ENVIRONMENTAL COMPLIANCE.
(a) All parcels of Real Estate and their existing and, to the best of
Seller's knowledge, without investigation, prior uses and activities
thereon, including, but not limited to, the use, maintenance and operation
of each of the parcels of Real Estate and all activities in conduct of
business related thereto, comply and have at all times complied in all
material respects with all Environmental Requirements (as such term is
hereinafter defined). All Leased Real Estate as used by Seller and, to the
best of Seller's knowledge, without investigation, prior uses and
activities thereon, including, but not limited to, the use, maintenance and
operation of the Leased Real Estate and all activities in conduct of
business related thereto, comply and have at all times complied in all
material respects with all Environmental Requirements.
(b) Seller and to the best of Seller's knowledge, without
investigation, all previous owners, tenants, occupants or users of any of
the parcels of Real Estate and Leased Real Estate or any other person, have
conducted their operations and activities upon such Real Estate and Leased
Real Estate in compliance with all applicable Environmental Requirements in
any way involving the handling, manufacture,
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treatment, storage, use, generation, release, discharge, refining,
dumping or disposal of any Hazardous Materials (as such term is
hereinafter defined) the removal of which is required or the
maintenance of which is prohibited or penalized.
(c) No Hazardous Material is currently, or to the best of
Seller's knowledge, has been located in, on, under or about any of the
Real Estate or Leased Real Estate in a manner which violates any
Environmental Requirement or which requires cleanup or corrective
action of any kind under any Environmental Requirement.
(d) No notice of violation, lien, complaint, suit, order or other
notice or communication concerning any alleged violation of any
Environmental Requirement ("Environmental Notice") in, on, under or
about any of the Real Estate has been received by Seller, nor has
Seller received any such Environmental Notice with respect to Seller's
use of the Leased Real Property, in either case, which has not been
fully satisfied and complied with in a timely fashion so as to bring
such Real Estate or Leased Real Estate in full compliance with all
Environmental Requirements. To the best of Seller's knowledge, without
investigation, there has not been any Environmental Notice with
respect to any of the Real Estate or Leased Real Estate received by
any prior owner or occupant of any of the Real Estate or Leased Real
Estate which has not been fully satisfied and complied with in a
timely fashion so as to bring such Real Estate or Leased Real Estate
into full compliance with all Environmental Requirements.
(e) Seller has all permits and licenses required under any
Environmental Requirement to be issued to it by any governmental
authority on account of any or all of its activities on any of the
Real Estate and Leased Real Estate and is in material compliance with
the terms and conditions of such permits and licenses. Any and all
such permits and licenses are described in SCHEDULE 1.1(a)(ii). To the
best of Seller's knowledge, without investigation, no change in the
facts or circumstances reported or assumed in the application for or
granting of such permits or licenses exist, and such permits and
licenses are in full force and effect.
(f) To the best of Seller's knowledge, no portion of any of the
Real Estate or of the portion of the Leased Real Estate used by
Seller, has been listed, designated or identified in the National
Priorities List (NPL) or the CERCLA information system (CERCLIS), both
as published by the United States Environmental Protection Agency, or
any similar list of sites published by any Federal, state or local
authority proposed for or requiring cleanup, or remedial or corrective
action under any Environmental Requirement.
(g) As used herein "Environmental Requirements" shall mean all
applicable statutes, regulations, rules, ordinances, codes, licenses,
permits, orders, approvals, plans, authorizations, policies and
similar items of all governmental agencies, departments, commissions,
boards, bureaus or instrumentalities of the United States,
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states and political subdivisions thereof and all applicable judicial,
administrative and regulatory decrees, judgments and orders relating to the
protection of human health or the environment.
(h) As used herein "Hazardous Materials" shall mean any flammable
explosives, radioactive materials, hazardous waste, toxic substances or
related materials, including, without limitation, asbestos, polychlorinated
biphenyls, urea formaldehyde, radon, and any substance defined as or
included in the definition of (a) any "hazardous waste" as defined by the
Resource Conservation and Recovery Act of 1976, as amended from time to
time, and regulations promulgated thereunder; (b) any "hazardous substance"
as defined by the Comprehensive Environmental Response, Compensation and
Liability Act of 1989, as amended ("CERCLA"), and regulations promulgated
thereunder; (c) any "toxic substance" as defined by the Toxic Substance
Control Act, as amended from time to time, and the regulations promulgated
thereunder; (d) any petroleum product; and (e) any other substance,
pollutant, contaminant, chemical or industrial toxic or hazardous substance
or waste, including, without limitation, hazardous materials, within the
meaning of any other applicable federal, state or local law, regulation,
ordinance or requirement (including consent decrees and administrative
orders) relating to or imposing liability or standards of conduct
concerning any hazardous, toxic or dangerous waste, substance or material,
all as amended or hereafter amended.
SECTION 3. COVENANTS OF SELLER
- --------- -------------------
Seller covenants and agrees that from the date hereof until the Closing
Date:
3.1. APPROVALS. Promptly upon the execution of this Agreement, Seller shall
prepare for filing with the FCC an appropriate application for FCC Consent to
the assignment of the Licenses, which shall be filed with the FCC within five
(5) business days after the date hereof. Seller shall thereafter prosecute the
application with all reasonable diligence and otherwise use its best efforts to
obtain such consent and approval of the FCC as expeditiously as practicable.
Seller shall not intentionally take or omit to take any action that will cause
the FCC to deny, delay, or fail to approve the application for such consents and
approvals or cause such consents and approvals not to become a Final Action.
3.2. ACCESS. Buyer shall have the right, itself or through its
representatives, during normal business hours and after reasonable written
notice, to inspect Seller's properties relating to the Stations and to inspect
and make abstracts and reproductions of all Seller's books and records relating
to the Stations, including, without limitation, applications and reports to the
FCC, and Seller shall furnish Buyer with such information respecting the Subject
Assets and Seller's business and financial records relating to the Stations as
Buyer may, from time to time, reasonably request. In the event Buyer determines
it to be necessary or appropriate for purposes of facilitating securities law
filings prior to or following the
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Closing, Buyer shall have the right, at Buyer's expense, to conduct an audit of
Seller's financial condition, and Seller shall cooperate with Buyer in
connection with such audit.
3.3. CONDUCT OF BUSINESS. Seller shall, to the extent permitted by FCC
rules and policies:
(a) refrain from making any sale, lease, transfer or other disposition
of any of the Subject Assets having a value per item in excess of $2,500
and valued in excess of $10,000 in the aggregate, other than in the normal
course of business at fair market value in connection with replacements of
equal or greater value with the prior approval of Buyer, which approval
will not be unreasonably withheld;
(b) refrain from modifying, amending, altering or terminating any of
the other Assumed Contracts or waiving any default or breach thereunder or
modifying, altering or terminating, any other right relating to or included
in the Subject Assets;
(c) maintain insurance on the Subject Assets against loss or damage by
fire and all other hazards and risks in an amount consistent with the
existing policy amounts described in SCHEDULE 3.3(c);
(d) maintain its books and records in accordance with prior practice;
maintain the Subject Assets in good condition, ordinary wear and tear
excepted; maintain supplies of inventory and spare parts relating to the
Stations consistent with past practices; and, except as otherwise
specifically provided in this Agreement, otherwise operate the Stations in
the ordinary course in accordance with past practices;
(e) refrain from taking any action which is not in the usual and
ordinary course of business regarding the Subject Assets or which could
reasonably be expected to materially adversely affect the value of the
Subject Assets;
(f) refrain from hiring, firing, releasing or transferring any
employee of any Station, in a manner inconsistent with past practice,
without the prior written approval of the Buyer;
(g) refrain from (i) increasing the compensation payable or to become
payable to any of Seller's employees or agents in a manner inconsistent
with past practices, except in accordance with this Agreement or as
approved by Buyer or (ii) entering into any contract or renewal or
amendment of any existing contract for the employment of any employee or
agent of Seller except with Buyer's approval;
(h) promptly notify Buyer upon Seller's becoming aware of the
resignation or contemplated resignation of any employee of either Station;
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(i) refrain from changing its corporate charter or by-laws in any way
which would adversely affect its corporate power or authority to enter into
and perform this Agreement or which would otherwise adversely affect its
performance of this Agreement;
(j) operate the Stations in accordance with the Licenses and
materially comply with all laws, rules and regulations applicable to it,
including the rules and regulations of the FCC;
(k) refrain from subjecting any of the Subject Assets to any new lien,
claim, charge, or encumbrance (other than minor liens, claims, charges or
encumbrances which will not materially interfere with the occupation, use
and enjoyment by Buyer of the Subject Assets in the normal course of its
business or impair the value of the Subject Assets and which shall be
discharged as of the Closing Date) or from increasing any existing lien,
claim, charge or encumbrance;
(l) refrain from doing or omitting to do any act which will cause a
breach of, or default under, or termination of, any Assumed Contract;
(m) without in any way limiting Buyer's rights under Section 6.2, take
such action as may be reasonably necessary to obtain any required consents
of third parties to the transactions contemplated herein, including,
without limitation, consents to the assignment of the Assumed Contracts and
the Real Estate Leases to Buyer;
(n) refrain from entering into any Trade-Out Agreement not in effect
on the date hereof and listed on SCHEDULE 1.1(a)(iv), having a value in
excess of $2,500, individually, or an aggregate value in excess of $10,000,
without the prior consent of Buyer (except for Trade-Out Agreements which
are fully performed by Seller prior to the Closing Date);
(o) refrain from entering into any other contract or agreement not in
effect on the date hereof and listed on SCHEDULE 1.1(a)(iv), except for
contracts entered into in the ordinary course of business which do not
involve consideration having an aggregate value in excess of $10,000 and
which may be terminated on not more than ninety (90) day's notice without
premium or penalty;
(p) within thirty (30) days after the end of each month, furnish to
Buyer a balance sheet, a statement of operations and a statement of cash
flows of each Station for such period prepared on a consistent basis for
each such period and consistent with past practice;
(q) provide to Buyer, concurrently with filing thereof, copies of all
reports to and other filings with the FCC relating to the Stations;
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<PAGE> 18
(r) not permit any of the Licenses to expire or to be surrendered or
voluntarily modified, or take any action (or fail to take any action) which
could cause the FCC or any other governmental authority to institute
proceedings for the suspension, revocation or limitation of rights under
any License; or fail to prosecute with due diligence any pending
applications to any governmental authority with respect to the Stations or
any such Licenses, except for proceedings affecting the radio broadcasting
industry generally;
(s) provide to Buyer, promptly upon receipt thereof by Seller, a copy
of (i) any notice from the FCC or any other governmental authority of the
revocation, suspension, or limitation of the rights under, or of any
proceeding for the revocation, suspension, or limitation of the rights
under (or that such authority may in the future, as the result of failure
to comply with laws or regulations or for any other reason, revoke, suspend
or limit the rights under) any License, or any other license or permit held
by Seller respecting any Station, and (ii) copies of all protests,
complaints, challenges or other documents filed with the FCC by third
parties concerning any Station and, promptly upon the filing or making
thereof, copies of Seller's responses to such filings;
(t) notify Buyer in writing immediately upon learning of the
institution or written threat of any action against Seller involving either
Station in any court, or any action against Seller before the FCC or any
other governmental agency, and notify Buyer in writing promptly upon
receipt of any administrative or court order relating to the Subject Assets
or the Stations;
(u) except for the pending antenna installation application, refrain
from filing any application for any construction permit or modification of
any License affecting either Station or otherwise changing any of the
Station's facilities;
(v) pay or cause to be paid or provided for when due all income,
property, use, franchise, excise, social security, withholding, worker's
compensation and unemployment insurance taxes and all other taxes of or
relating to Seller, the Subject Assets and the employees required to be
paid to city, county, state, Federal and other governmental units up to the
Closing Date; and
(w) if requested by Buyer, with respect to any Assumed Contract which
can be terminated or not renewed by Seller in compliance with the terms
thereof, notify the other parties to such Assumed Contract that Seller
elects to terminate (or, if applicable, elects not to renew) such Assumed
Contract.
(x) complete, prior to the Closing Date, the installation of the new
antenna on the Leased Real Estate in compliance with the existing tower
lease and with the FCC construction permit issued with respect to such
antenna.
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3.4. SATISFACTION OF CONDITIONS. Seller shall use all reasonable efforts to
cause all of the conditions set forth in Section 6.1(a) and 6.2 to be fulfilled.
Notwithstanding the foregoing, Seller shall not be obligated to spend more than
$100,000 to cure any defects or conditions with respect to the Real Estate
pursuant to Section 6.2(j). In the event that it costs more than $100,000 to
cure such defects or conditions, Buyer shall have the right to continue with the
Closing and relieve Seller for any costs over $100,000, or either party may
terminate the Agreement.
3.5. NOTICE OF COMMENCEMENT OF PROCEEDINGS OR CHANGE IN CONDITION. Seller
shall provide written notice to Buyer as soon as possible and in any event
within five (5) days of Buyer obtaining knowledge of the occurrence of any of
the following events, stating in detail the nature thereof: (i) any proceedings
instituted against Seller by or in any federal or state court or before any
commission, board or other regulatory body, federal, state or local, which, if
adversely determined, would have a material adverse effect upon Seller's ability
to perform any of its obligations under this Agreement; (ii) any action or
threatened action against Seller involving either Station in any court, or any
action against Seller before the FCC or any other governmental agency, and (iii)
any material adverse change in the condition, financial or otherwise, of either
Station or Seller.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF BUYER
- --------- ---------------------------------------
In order to induce Seller to enter into this Agreement, Buyer represents
and warrants to Seller that:
4.1. ORGANIZATION OF BUYER. Buyer is a corporation duly organized and
validly existing and in good standing under the laws of the State of Delaware
and is, or by the Closing Date will be, duly qualified to transact business in
the State of Maine.
4.2. AUTHORITY OF BUYER. Buyer has the corporate power to execute, deliver
and perform this Agreement and the Escrow Agreement, the Non-Compete Agreement,
the Assumption Agreement, the Employment Agreement and the other agreements and
instruments to be executed and delivered by Buyer pursuant hereto (herein
collectively called the "BUYER AGREEMENTS") and to own the Subject Assets and
operate the Stations after the consummation of the transactions contemplated
hereby. Prior to the Closing Buyer will have taken all necessary corporate
action to authorize the execution, delivery and performance by Buyer of this
Agreement and the Buyer Agreements.
4.3. BINDING EFFECT. This Agreement and the Escrow Agreement constitute,
and as of the Closing Date, the other Buyer Agreements will constitute, the
legal, valid and binding obligations of Buyer, enforceable against it in
accordance with their terms.
4.4. NO VIOLATION. Neither the execution and delivery by Buyer of this
Agreement and the Buyer Agreements, nor the consummation of the transactions
contemplated hereby or thereby, violate or will violate any provision of law or
any order, judgment or decree of any
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court or other agency of government, including, without limitation, the FCC, or
any provision of Buyer's corporate charter or by-laws, or conflict with or will
result in any breach of any term, condition or provision of, or constitute or
will constitute (with due notice or lapse of time or both) a default under, or
will result in the creation or imposition of any lien, charge or encumbrance
upon any of the properties or assets of the Buyer pursuant to the terms of, any
mortgage, deed of trust or other agreement or instrument to which Buyer is a
party or by which or to which Buyer or any of its respective assets are subject
or bound, which lien, charge or encumbrance could adversely affect Buyer's
ability to perform its obligations hereunder.
4.5. CONSENTS. Other than the consents and approvals of the FCC referred to
in Section 5.1, certain filings required to be made with the FCC after the
Closing Date, filings to be made with the Securities Exchange Commission,
consents of third parties to Assumed Contracts, filings required to perfect
security interests and liens and other consents, approvals, authorizations and
filings contemplated by this Agreement or otherwise obtained or completed at or
prior to the Closing, Buyer is not required to obtain any consent, approval or
authorization from, or to file any declaration or statement with, any
governmental instrumentality or other agency or any third party in connection
with the execution of this Agreement or any of the Buyer Agreements or the
consummation of the transactions contemplated hereunder.
4.6. BROKER'S FEE. Buyer has not incurred or become liable for any broker's
commission or finder's fee relating to the transactions contemplated by this
Agreement, other than a broker's commission payable to Gary Stevens & Company,
Inc., which shall be borne by the Buyer if the Closing occurs. Buyer agrees to
indemnify and hold Seller harmless from any claims for brokerage fees, finder's
fees or commissions asserted by any person acting on Buyer's behalf in
connection with this transaction.
4.7. QUALIFICATION. Assuming that the FCC has promulgated the necessary
rules and regulations under the Telecommunications Act of 1996 so as to permit
Buyer's ownership of the Licenses identified on Schedule 1.1(a)(ii) without the
Buyer having to divest of any other radio stations currently owned by Buyer, and
except for the matters disclosed in Schedule 4.7, Buyer is legally and
technically qualified to become the licensee of the Stations and is financially
qualified to purchase the Stations and consummate the transactions contemplated
herein.
4.8. LITIGATION. There is no litigation, action, suit, investigation or
proceeding pending or, to the best of Buyer's knowledge, threatened against
Buyer or any of its affiliates before or by any court or the FCC or any other
governmental agency or any board of arbitration which could reasonably be
expected to (a) impair Buyer's ability to perform its obligations under this
Agreement, or (b) materially and adversely affect the ability of Buyer to own
and operate the Stations after the Closing.
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<PAGE> 21
4.9. MATERIAL FACTS. No representation or warranty made by Buyer in this
Agreement and no statement made by Buyer (a) in any certificate or other writing
executed and delivered by Buyer, (b) in any Buyer Agreement or other document or
writing furnished in connection with the transactions herein contemplated and
referred to herein, or (c) in any document or other writing delivered to Seller
after the date hereof and on or prior to the Closing Date by or on behalf of
Buyer contains or will contain any untrue statement of a material fact, or omits
or will omit to state any material fact necessary in order to make the
statements contained herein or therein not misleading.
SECTION 5. COVENANTS OF BUYER
- --------- ------------------
Buyer covenants and agrees that from the date hereof until the Closing
Date:
5.1. APPROVALS. Promptly upon the execution of this Agreement, Buyer shall
prepare for filing with the FCC an appropriate application for FCC consent to
the assignment of the Licenses, which shall be filed with the FCC within five
(5) business days after the date hereof. Buyer shall thereafter prosecute the
application with all reasonable diligence and otherwise use its best efforts to
obtain such consent and approval of the FCC as expeditiously as practicable.
Buyer shall not intentionally take or omit to take any action that will cause
the FCC to deny, delay, or fail to approve the application for such consents and
approvals or cause such consents and approvals not to become a Final Action,
including but not limited to any action that would cause Buyer's representations
in Section 4.7 to be untrue.
5.2 NOTICE OF COMMENCEMENT OF PROCEEDINGS OR CHANGE IN CONDITION. buyer
shall provide written notice to Seller as soon as possible and in any event
within five (5) days of Buyer obtaining knowledge of the occurrence of any of
the following events, stating in detail the nature thereof: (i) any proceedings
instituted against Buyer by or in any federal or state court or before any
commission, board or other regulatory body, federal, state or local, which, if
adversely determined, would have a material adverse effect upon Buyer's ability
to perform any of its obligations under this Agreement and (ii) any material
adverse change in the condition, financial or otherwise, of Buyer.
5.3. SATISFACTION OF CONDITIONS. Buyer shall use all reasonable efforts to
cause all of the conditions set forth in Sections 6.1(a) and 6.3 to be
fulfilled.
SECTION 6. CONDITIONS TO CLOSING
- --------- ---------------------
6.1. MUTUAL CONDITIONS.
The obligations of Buyer and Seller to consummate this Agreement and the
transactions contemplated hereby are subject to satisfaction at the time of the
Closing of the following conditions precedent:
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<PAGE> 22
(a) The FCC shall have issued all necessary consents and approvals in
connection with the transactions contemplated by this Agreement, any
condition to the effectiveness of such consent and approval which is
specified therein shall have been met and, subject to Buyer's rights in the
next succeeding sentence, the same shall have become a Final Action.
Notwithstanding the foregoing, the Buyer may, at its option, waive the
condition precedent that the FCC consent and approval shall have become a
Final Action (which waiver, if made by Buyer, shall be deemed also made by
Seller), provided, however, that such consent and approval shall have been
issued by the FCC without opposition thereto by any person. As used in this
Agreement, "Final Action" shall mean an order of the FCC with respect to
which no appeal, no petition for rehearing, reconsideration, or stay, and
no other administrative or judicial action contesting such consent or
approval, is pending and as to which the time for filing any such appeal,
petition or other action has expired or, if filed, has been denied,
dismissed, or withdrawn and the time for instituting any further legal
proceeding has expired.
(b) If the FCC for any reason designates for hearing any application
for assignment of any License, then either Buyer or Seller may terminate
this Agreement upon not less than ten (10) days' prior notice to the other,
provided that the terminating party is not at the time of delivery of such
notice in material default hereunder. Upon termination under this Section
6.1(b), the Deposit and the earnings thereon shall be paid to Buyer
pursuant to the Escrow Agreement and the parties shall have no further
obligations to each other hereunder.
(c) The FCC shall have promulgated the necessary rules and regulations
under the Telecommunications Act of 1996, so as to permit the assignment to
Buyer of the Licenses identified on Schedule 1.1(a)(ii) and the
consummation of the transactions contemplated herein without Buyer having
to divest of any other radio stations currently owned by Buyer.
6.2. CONDITIONS TO OBLIGATIONS OF BUYER. Buyer's obligation to consummate
the transactions contemplated by this Agreement is subject to satisfaction at
the time of Closing of each of the following conditions precedent, any of which
Buyer may waive in its discretion:
(a) Each of Seller's representations and warranties contained in this
Agreement shall be true and correct in all material respects on the Closing
Date as though made on and as of the Closing Date, except for changes
expressly permitted or contemplated by the provisions of this Agreement;
and Seller shall have performed in all material respects all of its
covenants and obligations hereunder which by the terms hereof are to be
performed on or before the Closing Date.
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<PAGE> 23
(b) Seller shall have obtained and delivered to Buyer the consents of
third parties to those contracts designated with an asterisk on Schedule
1.1(a)(iv) which are necessary to permit the valid transfer to Buyer of all
the Subject Assets.
(c) No action or proceeding shall have been instituted or threatened
against Buyer, any of Buyer's affiliates or Seller before any court or
governmental agency or commission or any board of arbitration seeking to
restrain or prohibit, or to obtain substantial damages against Buyer or any
of Buyer's affiliates in respect of, this Agreement or consummation of the
transactions contemplated hereby.
(d) The Licenses issued by the FCC (i) shall have been assigned and
transferred to Buyer, (ii) shall be valid and existing authorizations in
every respect for the purpose of operating the Stations, (iii) shall have
been issued by the FCC under the Communications Act of 1934, as amended,
for the full terms thereof, and (iv) shall contain no adverse modifications
of the terms of the FCC Licenses as of the date of the Licenses set forth
on SCHEDULE 1.1(a)(ii) and except for proceedings that affect the radio
broadcasting industry generally, no proceeding for any revocation,
suspension or modification shall be in effect, other than the pending
antenna installation application, and neither Seller nor Buyer shall have
received any notice that any governmental authority may institute any such
proceedings.
(e) Buyer shall have received the opinion, dated the Closing Date, of
Verrill & Dana, counsel to Seller, the form of which is attached hereto as
Exhibit A.
(f) Buyer shall have received the opinion, dated the Closing Date, of
Irwin, Campbell & Tannenwald, P.C., special FCC counsel to Seller, to the
effect that:
(i) Seller is the authorized legal holder of the Licenses issued
by the FCC. The FCC Licenses are in full force and affect in that they are
held by Seller and are currently effective for their respective license
terms as listed on an attachment to such opinion;
(ii) To the best of such counsel's knowledge after reasonable
inquiry of the FCC, (A) there is no FCC investigation, notice of apparent
liability, or order of forfeiture pending or outstanding against or in
respect of either Station respecting any violation, or allegation thereof,
of the Communications Act of 1934 or of any FCC rule, regulation or policy,
and (B) there is no complaint of which such counsel has been informed by
the FCC before the FCC as a result of which an investigation, notice of
apparent liability, or order of forfeiture could issue from the FCC
relating to any Station;
(iii) The conditions set forth in Section 6.1(a) of this Agreement
have been satisfied.
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<PAGE> 24
The opinions referred to in paragraphs (e) and (f) above may be subject
to certain customary qualifications, including without limitation, that the
enforceability of obligations under any agreement or document is subject to
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
the rights and remedies of creditors generally. Such opinions shall also
provide that Buyer's lenders may rely upon them.
(g) There shall have occurred no change in the condition (financial or
otherwise), results in operations, business, assets or profits of the
Stations as a whole which, individually or in the aggregate, is, or would
be reasonably likely to be, materially adverse to the Stations' condition,
results of operations, business, assets or profits; provided, however, that
with respect to advertising revenues of the Stations resulting from sales
by McGavren Guild Radio ("Rep Sales"), if the amount of Rep Sales for the
12 months prior to the month in which the Closing Date falls is at least
90% of the amount of Rep Sales for the year ended December 31, 1995, then
irrespective of whether such change is materially adverse, such change
shall not, in and of itself, be deemed to constitute a failure of the
condition set forth in this clause (g).
(h) Seller shall have delivered to Buyer a Certificate of a senior
officer of Seller, dated as of the Closing Date, certifying as to the
matters set forth in the foregoing paragraphs (a) and (g).
(i) Seller shall have delivered to Buyer a certificate of Seller's
Secretary certifying as to the due adoption by its Board of Directors and
shareholders of resolutions authorizing the transactions contemplated by
this Agreement.
(j) Buyer shall have received the following:
(i) a written commitment to issue an owner's policy of title
insurance naming Buyer as the insured, written by a responsible title
insurance company authorized to write title insurance with respect to Maine
real estate, covering Seller's fee title to the Real Estate, which policy
shall guarantee such title to be in the condition called for by this
Agreement, subject only to those liens and encumbrances set forth on
SCHEDULE 1.5 which are designated to continue after the Closing (except for
mortgages, judgments or other liens which will be satisfied out of the
proceeds of the sale of the Subject Assets hereunder), and shall show no
rights of occupancy or use by third parties, no gaps in the chain of title
and no violations of any applicable zoning or other ordinance, statute,
rule or regulation;
(ii) a survey with respect to the Real Estate which does not
reveal any fact or condition which has not been disclosed to Buyer in this
Agreement and which is otherwise reasonably satisfactory to Buyer; and
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<PAGE> 25
(iii) a so-called "Phase One" environmental site assessment (the
"Environmental Site Assessments") for each parcel of Real Estate performed
by a recognized environmental engineering firm reasonably satisfactory to
Buyer, showing no noncompliance with any Environmental Requirement except
as described in Section 2.17(i) nor any basis for suspecting noncompliance
with any Environmental Requirement and otherwise reasonably satisfactory to
Buyer.
At its expense, Buyer shall have ordered, within ten (10) business
days following the execution of this Agreement, the title commitment, Real
Estate survey and Environmental Site Assessment and shall diligently pursue
the receipt of each. Upon the receipt of any of the title insurance
commitment, the survey or the Environmental Site Assessment, the Buyer
shall promptly provide Seller with written notice of any condition or
defect which would prevent compliance with the above-described standards,
and the Seller shall have a reasonable period of time to correct any such
condition or defect; but in any event, Seller shall have cured any and all
defects or conditions prior to the Closing.
(k) Ocean Coast Properties shall have executed and delivered the
Non-Compete Agreement.
(l) Robert Gold shall not have repudiated the Employment Agreement.
6.3. CONDITIONS TO OBLIGATIONS OF SELLER. Seller's obligation to consummate
the transactions contemplated by this Agreement are subject to satisfaction at
the time of Closing of each of the following conditions precedent, any of which
may be waived by Seller:
(a) Each of the representations and warranties of Buyer contained in
this Agreement shall be true and correct in all material respects on the
Closing Date as though made on and as of the Closing Date, except for
changes expressly permitted or contemplated by the provisions of this
Agreement; and Buyer shall have performed in all material respects all of
its covenants and obligations hereunder which by the terms hereof are to be
performed on or before the Closing Date.
(b) Buyer shall have paid the Purchase Price less the Post-Closing
Escrow, as provided in Section l.3 of this Agreement.
(c) Buyer shall have executed and delivered the Non-Compete Agreement.
(d) Buyer shall have executed and delivered the Assumption Agreement.
(e) Buyer shall have delivered to Seller a Certificate of a senior
officer of Buyer, dated as of the Closing Date, certifying as to the
matters set forth in the foregoing paragraphs (a).
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<PAGE> 26
(f) Buyer shall have delivered to Seller a Certificate of the Buyer's
Secretary certifying as to the due adoption by Buyer's Board of Directors
of resolutions authorizing the transactions contemplated by this Agreement.
SECTION 7. INDEMNIFICATION
- --------- ---------------
7.1. RIGHT TO INDEMNIFICATION. (a) Seller shall indemnify, reimburse and
hold harmless Buyer from and against all claims, losses, damages, costs
(including, without limitation, court costs and reasonable attorneys' fees),
expenses and liabilities suffered, incurred, or sustained by Buyer on account of
(i) any misrepresentation, breach of warranty, or nonfulfillment of any
agreement or covenant on the part of Seller under this Agreement or any Seller
Agreement, (ii) the operation of the Stations prior to the Closing, including,
without limitation, for any breach or default prior to the Closing Date by
Seller under any of the Assumed Contracts; (iii) any liability of Seller not
specifically assumed by Buyer hereunder, and (iv) any alleged noncompliance with
any Environmental Requirements by reason of acts occurring prior to the Closing;
and (v) any other matter or event respecting Seller which occurs prior to the
Closing Date and which is not an Assumed Liability.
(b) If the Closing occurs, Buyer shall indemnify, reimburse, and hold
harmless Seller from and against all claims, losses, damages, costs
(including, without limitation, court costs and reasonable attorneys'
fees), expenses and liabilities suffered, incurred, or sustained by Seller,
on account of (i) any misrepresentation, breach of warranty, or
nonfulfillment of any agreement or covenant on the part of Buyer under this
Agreement or any Buyer Agreement, (ii) the operation of the Stations after
the Closing (other than those arising out of contracts, commitments, or
agreements of Seller not specifically assumed by Buyer) and (iii)
liabilities constituting Assumed Liabilities.
(c) Any amounts owed by either party under this Section 7 shall bear
interest from the date demand for payment thereof is made until payment in
full at a rate of fifteen percent (15%) per annum or such lower rate as
equals the maximum rate permitted by applicable law.
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SECTION 8. COVENANTS, ETC. TO SURVIVE CLOSING
- --------- ----------------------------------
Notwithstanding any investigation made by either Buyer or Seller, all
covenants, agreements, representations and warranties contained in this
Agreement and in any other instruments which may be delivered pursuant hereto or
in connection with the transactions contemplated hereby and which are referred
to herein or in the Schedules hereto and in any other agreements, documents and
instruments delivered by or on behalf of Seller after the date hereof and on or
prior to the Closing Date, shall be deemed to be material and to have been
relied upon by Buyer or Seller, as applicable and shall survive the Closing and
the consummation of the transactions contemplated hereby for two years;
provided, however, that the representations and warranties of Seller contained
in Sections 2.5, 2.11, and 2.17 of this Agreement shall survive the Closing
until the expiration of any applicable statute of limitations.
SECTION 9. DEFINITIONS.
- --------- -----------
The following terms are defined in the provisions of this Agreement indexed
below:
Defined Term: Defined In:
------------- -----------
Assumed Contracts Section 1.1(a)(iv)
-----------------
Assumed Liabilities Section 1.2
-------------------
Assumed Trade-Out Agreements Section 1.1(a)(iv)
----------------------------
Assumption Agreement Section 1.5(c)
--------------------
Buyer Preamble
-----
Buyer Agreements Section 4.2
----------------
CERCLA Section 2.17(h)
------
Closing Section 1.4
-------
Closing Date Section 1.4
------------
Collection Period Section 1.7
-----------------
Deposit Section 1.3(a)
-------
Employment Agreement Section 1.5(g)
--------------------
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Environmental Notice Section 2.17
--------------------
Environmental Requirements Section 2.17
--------------------------
Environmental Site Assessments Section 6.2(i)
------------------------------
Escrow Agent Section 1.3(a)
------------
Escrow Agreement Section 1.3(a)
----------------
Excluded Property Section 1.1(b)
-----------------
FCC Recitals
---
FCC Filings Section 10.7
-----------
Final Action Section 6.1(a)
------------
Financial Statements Section 2.8
--------------------
Hazardous Materials Section 2.17(h)
-------------------
Leased Real Estate Section 2.5
------------------
Licenses Section 1.1(a)(ii)
--------
Non-Compete Agreement Section 1.5(f)
---------------------
Post-Closing Escrow Section 1.3(b)
-------------------
Prevailing Party Section 10.14
----------------
Purchase Price Section 1.3(a)
--------------
Real Estate Section 1.1(a)(iii)
-----------
Real Estate Leases Section 1.1(a)(iv)
------------------
Seller Preamble
------
Seller Agreements Section 2.2
-----------------
Stations Recitals
--------
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Subject Assets Section 1.1(c)
--------------
Tangible Assets Section 1.1(a)(i)
---------------
Trade-Out Agreements Section 1.1(a)(iv)
--------------------
Transfer Instruments Section 1.5(a)
--------------------
SECTION 10. MISCELLANEOUS
- ---------- -------------
10.1. FEES AND EXPENSES.
(a) All costs of transferring the Subject Assets in accordance with
this Agreement, including recordation, transfer and documentary taxes and
fees, shall be borne equally by Seller and Buyer.
(b) Each of the parties shall bear its own expenses in connection with
the negotiation and the consummation of the transactions contemplated by
this Agreement, including the Seller Agreements and the Buyer Agreements.
10.2. LAW GOVERNING. This Agreement shall be construed under and governed
by the laws of the State of Maine.
10.3. NOTICE. Any notice or communication given pursuant to this Agreement
by any party to any other party shall be in writing and shall be deemed given
when personally delivered or when sent by registered or certified mail, return
receipt requested, postage prepaid to the parties at their addresses set forth
on page 1 of this Agreement or to such other address as either party may
hereafter designate to the other by like notice with a copy in each case of
notice to Buyer, to Stephen O. Meredith, Esq., Edwards & Angell, 101 Federal
Street, Boston, Massachusetts 02110 and, in each case of notice to Seller, to
Peter Webster, Esq., Verrill & Dana, One Portland Square, 9th Floor, Portland,
Maine 04101.
10.4. SPECIFIC PERFORMANCE. Seller recognizes and acknowledges that in the
event it shall fail to perform its obligation to consummate the sale of the
Subject Assets pursuant hereto, money damages alone will not be adequate to
compensate Buyer. Seller, therefore, agrees and acknowledges that in the event
of its failure to perform its obligation to consummate the sale of the Subject
Assets pursuant hereto, Buyer shall be entitled, in addition to any action for
monetary damages, and in addition to any other rights and remedies on account of
such failure, to specific performance of the terms of this Agreement and of
Seller's obligation to consummate the sale of the Subject Assets pursuant
hereto.
10.5. RISK OF LOSS. (a) The risk of loss or damage to the Subject Assets by
force majeure or for any other reason to Seller's business or property between
the date of this Agreement and the Closing shall be borne by Seller. Seller
shall take all reasonable steps to
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repair, replace and restore such property as soon as possible after any
loss or damage, it being understood that all insurance proceeds shall be
applied to or reserved for such replacement, restoration, or repair.
(b) In the event of any damage to any Station or upon the occurrence
of any other event which materially impairs broadcast transmissions of any
Station in the normal and usual manner and substantially in accordance with
the respective FCC Licenses of the Stations, Seller shall provide prompt
notice thereof to Buyer and the Closing Date shall be postponed until such
transmission in accordance with the applicable FCC Licenses has been
resumed. The postponed Closing Date shall be such date within the effective
period of the FCC's consent to transfer of the Stations to Buyer as Buyer
may designate by not less than five (5) days' prior notice to Seller. In
the event Seller's facilities cannot be restored within the effective
period of the FCC's consent to transfer of the Stations to Buyer unless, in
Buyer's reasonable judgment, the damage to the Station(s) could materially
adversely affect the operations of the Station(s) on a continuing basis,
the parties shall join in an application or applications requesting the FCC
to extend the effective period of its consent for a period not to exceed
one hundred twenty (120) days. If no such application is filed with the
FCC, or if any such application is filed with the FCC and the facilities
have not been restored so that the Closing Date may occur within such
extended period or any agreed extension thereof, Buyer shall have the
right, by providing written notice of termination to Seller within 10 days
after the expiration of the effective period or such 120-day period or any
agreed extension hereof, as the case may be, to terminate this Agreement
forthwith without any further obligation to either party and, upon such
termination, the Deposit and the earnings thereon shall be paid to Buyer
pursuant to the Escrow Agreement. The foregoing notwithstanding, if any
damage to the business or property of Seller requires any Station to be
taken off the air or if broadcast transmissions of such Station in
accordance with the applicable FCC Licenses is interrupted for any other
reason or if any Station is operated at less than its maximum licensed
aural effective operating power, in any such case for a total of ninety-six
(96) hours (whether or not consecutive) then Buyer may terminate this
Agreement upon written notice to Seller without any further obligation to
either party and, upon such termination, the Deposit and the earnings
thereon shall be paid to Buyer.
(c) In the case of any damage or destruction to the Subject Assets, if
full repair, replacement or restoration to or of all material assets has
not been made on or before the Closing Date (as the Closing Date may be
extended as provided above in this Section 10.5), then Buyer shall not be
obligated to purchase the Subject Assets and if not so purchased, the
Deposit and the earnings thereon shall be paid to Buyer pursuant to the
Escrow Agreement. In any case where full repair, replacement, or
restoration to or of all damaged or destroyed assets has not been made and
Buyer acquires the Subject Assets (whether or not it is obligated to do
so), then at the Closing Seller shall pay to Buyer all proceeds of
insurance received by Seller and not then paid by Seller for such repair,
replacement, or restoration, and shall assign to Buyer all rights to
receive proceeds of insurance on account of such damage or destruction, and
Seller shall thereafter, promptly upon presentation of invoices by Buyer,
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<PAGE> 31
reimburse the Buyer for all costs and expenses of repair, replacement, and
restoration to the former condition paid or incurred by Buyer after the
Closing and not paid for by insurance.
(d) Without limiting in any way the Buyer's rights under Section 6.2
hereof, Seller shall not be deemed in breach of this Agreement to the
extent that such breach arises from property damage and/or destruction
described above in this Section 10.5 if Seller shall perform in accordance
with the provisions of this Section.
10.6. CONTROL OF THE STATIONS. Between the date hereof and the date on
which the Subject Assets are transferred to Buyer, as to each Station, Buyer
shall not directly or indirectly control, supervise or direct, or attempt to
control, supervise or direct, the operations of the Stations. Such operations,
including the complete control and supervision of all employees, financial
affairs, station policy and programming shall be the sole responsibility of
Seller. Seller represents and warrants that it understands the FCC's rules and
policies regarding unauthorized transfer of control of FCC licenses and agrees
that it will not directly or indirectly take any action inconsistent therewith.
Seller represents and warrants that at all times prior to the date on which the
Subject Assets are transferred to Buyer, Seller will exercise all required
authority and control over the Stations' employees, financial affairs, station
policy, and programming in order to avoid an unauthorized transfer of control of
Stations.
10.7. CHANGES TO FACILITIES. Seller agrees that with Seller's consent,
which consent shall not be unreasonably withheld, Buyer may, at Buyer's expense,
file with the FCC applications, petitions, or other papers (herein "FCC
Filings") as deemed necessary by Buyer to change the facilities of the Stations.
Upon request of Buyer, and as often as required by Buyer, Seller shall promptly
provide to Buyer (pursuant to Section 73.3517 of the FCC's Rules) a written
statement or statements which specifically grant Seller's permission to Buyer
(a) to file such application, petition, or other papers, and (b) to file the
statement with the application, petition or other papers.
10.8. CONSTRUCTION. The headings contained in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.
10.9. ASSIGNMENT; BINDING EFFECT. This Agreement shall not be assignable by
either Seller or Buyer without the prior written consent of the other, provided
that Buyer may (a) make collateral assignments of its right, title and interest
hereunder to its lenders; and (b) with the consent of Seller, which consent
shall not be unreasonably withheld, assign its rights and delegate its
obligations, with recourse, to one or more partnerships, corporations or other
business entities controlled by or under common control with Buyer, including
without limitation a limited partnership of which Buyer is the sole general
partner, provided that such assignment does not cause any delay in the
fulfillment of the conditions in Section 6.1(a); and provided further that (i)
any such assignee shall agree in writing (in a form reasonably satisfactory to
Seller and its counsel) to assume all of Buyer's obligations to Seller
hereunder, and (ii) effective upon such assignment, the representations,
warranties and covenants set
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<PAGE> 32
forth herein shall be deemed amended, to the extent appropriate, to contain
corresponding written representations, warranties and covenants of the assignee,
which modifications shall be reflected, to the extent appropriate, in a
Certificate of Buyer furnished at the Closing, and the conditions set forth in
Section 6.3 relating to the delivery of certificates to Seller, and such
assignee shall, for all other purposes hereof, be deemed to be "Buyer"
hereunder. This Agreement shall be binding upon, and shall inure to the benefit
of, the parties hereto and their successors and assigns.
10.10. AMENDMENT; WAIVER. This Agreement may be amended only by a written
instrument signed by Buyer and Seller. No provisions of this Agreement may be
waived except by an instrument in writing signed by the party sought to be
bound. No failure or delay by any party in exercising any right or remedy
hereunder shall operate as a waiver thereof, and a waiver of a particular right
or remedy on one occasion shall not be deemed a waiver of any other right or
remedy or a waiver on any subsequent occasion.
10.11. ENTIRE AGREEMENT. This Agreement (including the Exhibits and
Schedules hereto), the Escrow Agreement, the Assumption Agreement, the
Non-Compete Agreement, the Transfer Instruments and any other documents and
agreements entered into in connection herewith and referred to herein or in the
Schedules hereto and any other documents and agreements entered into in
connection herewith after the date hereof and on or prior to the Closing Date,
set forth the entire understanding between the parties relating to the subject
matter hereof, any and all prior correspondence, conversations and memoranda or
other writings being merged herein and therein and replaced and being without
effect hereon. No promises, covenants or representations of any character or
nature other than those expressly stated herein have been made to induce either
party to enter into this Agreement. Neither this Agreement nor any part hereof,
including this provision against oral modifications, may be modified, waived or
discharged except by a writing duly signed by the party sought to be bound.
10.12. SEVERABILITY. If any term or provision of this Agreement or the
application thereof to any circumstance shall, to any extent, be invalid or
unenforceable, the remainder of this Agreement or the application to other
persons and circumstances shall not be affected thereby and each term and
provision hereof shall be enforced to the fullest extent permitted by law.
Specifically, without limitation, if any provision shall be deemed by a court of
competent jurisdiction to be invalid or unenforceable as to any periods of time,
territories or business activities, such provision shall be deemed limited to
the extent necessary to render it valid and enforceable.
10.13. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, with the same force and effect as if all the signatures thereto
appeared on the same instrument.
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<PAGE> 33
IN WITNESS WHEREOF, Seller and Buyer have caused this Agreement to be
executed by their respective duly authorized officers, as of the day and year
first above written.
OCEAN COAST PROPERTIES
By: /s/ Robert J. Gold
------------------------------
Title: President
-----------------------
SAGA COMMUNICATIONS OF
NEW ENGLAND, INC.
By:
------------------------------
Title:
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<PAGE> 34
IN WITNESS WHEREOF, Seller and Buyer have caused this Agreement to be
executed by their respective duly authorized officers, as of the day and year
first above written.
OCEAN COAST PROPERTIES
By:
------------------------------
Title:
-----------------------
SAGA COMMUNICATIONS OF
NEW ENGLAND, INC.
By: /s/ Norman L. McKee
------------------------------
Title: /s/ Sr. V.P.
-----------------------
<PAGE> 1
EXHIBIT (4)
AMENDED AND RESTATED
CREDIT AGREEMENT
DATED AS OF June 17, 1996
(amending and restating the Credit Agreement dated as of May 12, 1994)
AMONG
SAGA COMMUNICATIONS, INC.,
CERTAIN OF ITS SUBSIDIARIES,
THE LENDERS PARTY HERETO
AND
THE FIRST NATIONAL BANK OF BOSTON, as Agent
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TABLE OF CONTENTS
Page
ARTICLE I. Definitions 2
Section 1.1. Definitions....................................... 2
Section 1.2. General Provisions Pertaining to Definitions...... 30
ARTICLE II. Commitments; Loans; Collateral...................... 30
Section 2.1. Loans............................................... 30
Section 2.2. Notices Relating to Loans;
Requests for Eurodollar Loans...................... 31
Section 2.3. Disbursement of Loan Proceeds....................... 32
Section 2.4. Notes............................................... 33
Section 2.5. Mandatory Principal Payments........................ 33
Section 2.6. Voluntary Reduction or Termination of
Revolving Credit Commitments; Voluntary
Payments........................................... 36
Section 2.7. Interest............................................ 37
Section 2.8. Fees................................................ 38
Section 2.9. Use of Proceeds of Loans............................ 38
Section 2.10. Computations........................................ 38
Section 2.11. Minimum Amounts of Borrowings, Conversions
and Prepayments.................................... 39
Section 2.12. Time and Method of Payments......................... 39
Section 2.13. Lending Offices..................................... 40
Section 2.14. Several Obligations................................. 40
Section 2.15. Security............................................ 40
Section 2.16. Pro Rata Treatment Among Lenders.................... 41
Section 2.17. Non-Receipt of Funds by Agent....................... 41
Section 2.18. Sharing of Payments and Set-Off Among Lenders....... 42
Section 2.19. Conversion of Loans................................. 42
Section 2.20. Additional Costs; Capital Requirements.............. 43
Section 2.21. Limitation of Types of Loans........................ 45
Section 2.22. Illegality.......................................... 45
Section 2.23. Certain Conversions Pursuant to
Sections 2.20 and 2.22............................. 45
Section 2.24. Indemnification..................................... 46
Section 2.25. Waiver of Claims.................................... 46
Section 2.26. Reallocation of Existing Loans...................... 47
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ARTICLE III. Letters of Credit................................... 48
Section 3.1. Letter of Credit Commitment......................... 48
Section 3.2. Issuance of Letters of Credit....................... 48
Section 3.3. Participation by Lenders............................ 49
Section 3.4. Letter of Credit Disbursements...................... 50
Section 3.5. Obligation to Repay Letter of Credit
Disbursements, etc................................. 50
Section 3.6. Letter of Credit Fees............................... 52
ARTICLE IV. Representations and Warranties...................... 52
Section 4.1. Organization, Etc................................... 52
Section 4.2. Power; Authority; Consents; No Conflicts............ 53
Section 4.3. Due Execution, Validity and Enforceability.......... 53
Section 4.4. Priority of Liens; Condition of Assets.............. 54
Section 4.5. Judgments, Actions, Proceedings..................... 54
Section 4.6. No Defaults; Compliance with Laws................... 54
Section 4.7. Burdensome Documents................................ 55
Section 4.8. Governing Documents................................. 55
Section 4.9. Financial Information............................... 55
Section 4.10. No Material Changes................................. 55
Section 4.11. Taxes............................................... 56
Section 4.12. Intangible Assets................................... 56
Section 4.13. Intentionally Deleted............................... 56
Section 4.14. Licenses and Approvals.............................. 56
Section 4.15. Environmental Compliance............................ 57
Section 4.16. Employee Benefit Plans.............................. 58
Section 4.17. Labor Disputes; Collective Bargaining Agreements;
Employee Grievances................................ 59
Section 4.18. Insurance........................................... 59
Section 4.19. Transactions with Affiliates, Etc................... 60
Section 4.20. Absence of Certain Restrictions..................... 60
Section 4.21. Ancillary Documents................................. 60
Section 4.22. Solvency............................................ 60
Section 4.23. Application of Certain Laws and Regulations......... 61
Section 4.24. Full Disclosure..................................... 61
Section 4.25. Letters of Credit................................... 61
ARTICLE V. Conditions to Credit Extensions..................... 62
Section 5.1. Conditions to Initial Credit Extensions............. 62
Section 5.2. Conditions Precedent to Each Credit Extension....... 65
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ARTICLE VI. Guaranty............................................ 66
Section 6.1. Guaranty of Payment................................. 66
Section 6.2. Waivers of Notice, Etc.............................. 67
Section 6.3. Election of Remedies................................ 69
Section 6.4. Expenses............................................ 69
Section 6.5. Unenforceability of Obligations..................... 69
Section 6.6. Subrogation Rights; Subordination
of Subrogation Rights.............................. 70
Section 6.7. Limitation on Obligations........................... 70
ARTICLE VII. Delivery of Financial Reports,
Documents and Other Information.................... 71
Section 7.1. Annual Financial Statements......................... 71
Section 7.2. Quarterly Financial Statements...................... 71
Section 7.3. Compliance Information.............................. 71
Section 7.4. Accountants' Reports................................ 72
Section 7.5. Copies of Documents................................. 72
Section 7.6. Annual Budget....................................... 72
Section 7.7. Additional Information.............................. 72
ARTICLE VIII. Affirmative Covenants............................... 73
Section 8.1. Payment and Performance of Obligations.............. 73
Section 8.2. Conduct of Business................................. 73
Section 8.3. Books and Records................................... 74
Section 8.4. Inspections and Audits.............................. 74
Section 8.5. Insurance........................................... 74
Section 8.6. Notice of Defaults, Litigation; etc................. 75
Section 8.7. ERISA Notices....................................... 76
Section 8.8. No Termination of Loan Documents, Etc............... 76
Section 8.9. Environmental Laws.................................. 76
Section 8.10. Interest Rate Protection............................ 77
Section 8.11. Governmental Approvals.............................. 77
Section 8.12. Collateral for Loans................................ 77
Section 8.13. Dividends........................................... 78
Section 8.14. Appraisals.......................................... 78
Section 8.15. Permitted Acquisitions.............................. 78
Section 8.16. Further Assurances.................................. 79
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ARTICLE IX. Negative Covenants.................................. 79
Section 9.1. Indebtedness........................................ 79
Section 9.2. Liens............................................... 80
Section 9.3. Mergers, Consolidations, Sales of Assets............ 81
Section 9.4. Investments......................................... 83
Section 9.5. Restricted Payments................................. 84
Section 9.6. Issuance of Capital Stock........................... 85
Section 9.7. Sale and Leaseback.................................. 85
Section 9.8. ERISA Compliance.................................... 85
Section 9.9. Amendment or Termination of Documents............... 85
Section 9.10. Restrictive Agreements.............................. 86
Section 9.11. Transactions with Affiliates........................ 86
Section 9.12. Limitations on Operation of Saga Real Estate........ 86
ARTICLE X. Financial Covenants................................. 86
Section 10.1. Maximum Total Funded Debt Leverage Ratio............ 87
Section 10.2. Pro Forma Fixed Charges Coverage Ratio.............. 87
Section 10.3. Minimum Interest Coverage Ratio..................... 87
Section 10.4. General Provisions Relating to
Financial Terms and Covenants...................... 88
ARTICLE XI. Events of Default; Acceleration..................... 89
Section 11.1. Events of Default................................... 89
Section 11.2. Termination of Commitments;
Acceleration of Obligations........................ 92
Section 11.3. No Implied Waivers; Rights Cumulative............... 92
Section 11.4. Letters of Credit................................... 93
ARTICLE XII. The Agent........................................... 93
Section 12.1. Appointment, Powers and Immunities.................. 93
Section 12.2. Reliance by Agent................................... 94
Section 12.3. Events of Default................................... 94
Section 12.4. Rights as a Lender.................................. 94
Section 12.5. Indemnification..................................... 94
Section 12.6. Non-Reliance on Agent and Other Lenders............. 95
Section 12.7. Failure to Act...................................... 95
Section 12.8. Resignation or Removal of Agent..................... 95
Section 12.9. Sharing of Collateral and Payments.................. 96
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ARTICLE XIII. Miscellaneous Provisions........................... 97
Section 13.1. Fees and Expenses; Indemnity....................... 97
Section 13.2. Taxes.............................................. 98
Section 13.3. Survival of Agreements and Representations;
Construction...................................... 99
Section 13.4. Modifications, Consents and Waivers;
Entire Agreement.................................. 99
Section 13.5. Remedies Cumulative................................ 100
Section 13.6. Further Assurances................................. 100
Section 13.7. Notices............................................ 101
Section 13.8. Counterparts....................................... 102
Section 13.9. Severability....................................... 102
Section 13.10. Binding Effect; No Assignment or Delegation
by Borrower....................................... 102
Section 13.11. Assignments and Participations by Lenders.......... 103
Section 13.12. FCC Approval....................................... 107
Section 13.13. Usury Provision.................................... 107
Section 13.14. Certain Lien Releases.............................. 108
Section 13.15. Confidentiality.................................... 108
Section 13.16. Governing Law; Consent to Jurisdiction Waiver
of Trial by Jury.................................. 108
Section 13.17. Integration of Schedules and Exhibits.............. 109
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LIST OF SCHEDULES AND EXHIBITS
------------------------------
SCHEDULES DESCRIPTION
--------- -----------
1 Percentages
4.1 Organization; Capitalization
4.2 Approvals and Consents
4.4(a) Assets Excluded From Grant
of Security Interest
4.5 Litigation
4.7 Burdensome Documents
4.11 Tax Matters
4.12 Intellectual Property
4.14 FCC Licenses
4.15(a) Violation of Environmental Laws
4.15(b) Environmental Violation Notices
4.15(c) Release of Hazardous Substances
4.16 Employee Benefit Plans
4.17 Labor Disputes; Collective Bargaining Agreements
4.18 Insurance
8.2 Location of Principal Place of Business of Each
Borrower Affiliated Company
8.2(a) Local Market Agreements
9.1(i) Existing Indebtedness
9.2 Liens
9.3 Corporate Structure and Organization
9.4 Investments
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EXHIBITS DESCRIPTION
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A-1 Form of Revolving Credit Note
A-2 Form of Term Loan A Note
A-3 Form of Term Loan B Note
B Form of Second Amendment to Security
Documents Agreement
C Form of Indemnity, Contribution and
Subrogation Agreement
D Form of Effective Date Certificate
E Form of Assignment and Acceptance
Agreement
F Form of New Amendment to Mortgage
Documents
G Form of Second Amendment to Collateral
Trust Agreement
H Form of Lender Assignment Agreement
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AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT is made as of June 17, 1996
(amending and restating the Credit Agreement dated as of May 12, 1994), by and
among (1) SAGA COMMUNICATIONS, INC., a Delaware corporation (the "Borrower");
(2) the Borrower Subsidiaries (as defined in Article I below); (3) the various
financial institutions which are now, or in accordance with Section 13.11
hereafter become, parties hereto as Lenders (individually, a "Lender" and
collectively, the "Lenders"); (4) THE FIRST NATIONAL BANK OF BOSTON, a national
banking association, as agent for the Lenders (the "Agent"); and (5) THE BANK OF
NEW YORK, a banking corporation organized under the laws of the State of New
York, as co-agent for the Lenders (the "Co-Agent").
W I T N E S S E T H:
WHEREAS, the Borrower, certain Subsidiaries of the Borrower, various
financial institutions (collectively, the "Existing Lenders") and Bank of
Boston, as agent for the Existing Lenders, entered into a Credit Agreement,
dated as of May 12, 1994 (as heretofore amended, together with all the Schedules
and Exhibits thereto the "Existing Credit Agreement");
WHEREAS, in connection with the transactions contemplated by the
Existing Credit Agreement, the Borrower and certain Subsidiaries of the Borrower
granted to Bank of Boston, as Collateral Trustee, a first priority, perfected
pledge, security interest and/or mortgage in the Collateral (as defined in the
Existing Credit Agreement) pursuant to the Security Documents (as defined in the
Existing Credit Agreement), all as more particularly set forth in such Security
Documents;
WHEREAS, the Borrower has requested the Agent, the Co-Agent and the
Lenders to amend and restate the Existing Credit Agreement in its entirety and
to provide the Borrower with senior secured revolving credit and term loan
facilities (collectively, the "Facilities") in the maximum aggregate principal
amount of $110,000,000, consisting of a senior secured term loan facility in the
initial aggregate principal amount of up to $54,000,000 and a senior secured
revolving credit facility in the initial aggregate principal amount of
$56,000,000 (which would convert on the Conversion Date (as defined below) to a
term loan and a revolving credit facility in the initial combined aggregate
principal amount not exceeding the amount of such senior secured revolving
credit facility on the Conversion Date);
WHEREAS, the Agent, the Co-Agent and the Lenders are willing, subject
to the terms and conditions set forth herein, to amend and restate the Existing
Credit Agreement and to provide the Facilities to the Borrower and, in
connection therewith, (a) certain of the Existing Lenders have agreed to
continue their loans outstanding under the Existing
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Credit Agreement, to convert such loans into Credit Extensions hereunder and to
make new Credit Extensions hereunder and (b) certain new Lenders have agreed to
become parties hereto (the "New Lenders"), to purchase from the Agent certain
outstanding loans under the Existing Credit Agreement, to convert such loans
into Credit Extensions hereunder and to make new Credit Extensions hereunder,
all as more fully set forth herein; and
WHEREAS, in order to induce the Agent, the Co-Agent and the Lenders to
amend and restate the Existing Credit Agreement, the Borrower desires and it is
a condition to the effectiveness hereof, that the Principal Companies under the
Existing Credit Agreement confirm and reaffirm their respective grants to the
Collateral Trustee of the aforementioned first priority, perfected pledges,
security interests and/or mortgages in such Collateral to secure all Obligations
under and in connection with this Agreement and the other Loan Documents, all as
more particularly set forth in the Security Documents, as amended in connection
herewith;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties hereto hereby agree that upon the
execution of this Agreement, the Existing Credit Agreement (including all
Schedules and Exhibits thereto) shall be, and the same hereby is, amended and
restated in its entirety to read as set forth above and as follows (and, in the
case of Schedules and Exhibits, in the form attached hereto):
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. As used in this Loan Agreement, the following
terms shall have the following meanings:
"Acquisition" - shall mean any transaction, or any series of related
transactions, consummated prior to or after the date of this Agreement, in which
any Borrower Affiliated Company (in one transaction or as the most recent
transaction in a series of transactions) (i) acquires any Communications System,
any business or all or substantially all of the assets of any Person or any
division or business unit thereof, whether through purchase of assets, merger or
otherwise, (ii) directly or indirectly acquires control of at least a majority
(in number of votes) of the securities of a corporation which have ordinary
voting power for the election of directors or (iii) directly or indirectly
acquires control of a majority ownership interest in any partnership or joint
venture.
"Acquisition Documents" - all agreements, documents and instruments
executed and/or delivered in connection with any Acquisition.
"Affiliate" - any Person that directly or indirectly controls, or is
under common control with, or is controlled by, the Borrower. As used in this
definition, "control" (including, with its correlative meanings, "controlled by"
and "under common control with") shall mean possession, directly or indirectly,
of power to direct or cause the direction of
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management or policies (whether through ownership of securities or partnership
or other ownership interests, by contract or otherwise), provided that, in any
event, any Person that owns directly or indirectly securities having 5% or more
of the voting power for the election of directors or other governing body of a
corporation or 5% or more of the partnership or other ownership interests of any
other Person (other than as a limited partner of such other Person) will be
deemed to control such corporation or other Person. Notwithstanding the
foregoing, (a) no wholly owned subsidiary of the Borrower shall be an Affiliate
and (b) neither the Agent, nor any Lender shall be an Affiliate.
"Agent" - as defined in the preamble hereof.
"Agent's Special Counsel" - Bingham, Dana & Gould and such other
counsel as the Agent may from time to time retain as special counsel in
connection with the financing arrangements contemplated by or arising under the
Loan Documents.
"Agreement" - this Credit Agreement.
"Ancillary Documents" - collectively, (i) the Seller Debt Documents and
(ii) the Acquisition Documents.
"Applicable Lending Office" - with respect to each Lender, with respect
to each type of Loan, the lending office as designated for such type of Loan
below its name on the signature pages hereof or such other office of such Lender
or of an affiliate of such Lender as such Lender may from time to time specify
to the Agent and the Borrower as the office at which its Loans of such type are
to be made and maintained.
"Applicable Margin" - for any calendar quarter, the applicable
percentage set forth below opposite the Total Funded Debt Leverage Ratio as of
the end of the Most Recent Reference Period prior to the commencement of such
calendar quarter:
<TABLE>
<CAPTION>
APPLICABLE MARGINS
------------------
Total Funded Debt Applicable Margin Applicable Margin
Leverage Ratio for Prime Rate Loans for Eurodollar Loans
- ----------------- -------------------- --------------------
<S> <C> <C>
Greater than or equal to 0.500% 1.750%
4.0:1.0
Less than 4.0:1.0 but 125% 1.375%
greater than or equal to
3.0:1.00.
Less than 3.0:1.0 0.000% 1.125%
</TABLE>
Notwithstanding the foregoing, in the event that the Lenders shall not have
received the most recent financial statements and certificates required to be
delivered to them pursuant
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to Article VII prior to the first day of such calendar quarter, the Applicable
Margins for such calendar quarter shall (until all of such financial statements
and certificates are delivered to the Lenders) be the highest of the Applicable
Margins specified above.
"Asset" - any asset, property, interest (including equity interests) or
effect, real or personal, tangible or intangible, wherever situated.
"Assigning Lender" - as defined in Section 13.11(b).
"Assignment" - as defined in Section 13.11(b).
"Assignment and Acceptance Agreement" - as defined in Section 13.11(b).
"Available Revolving Credit Commitment" - at any time, an amount equal
to the excess, if any, of (i) the aggregate Revolving Credit Commitments at such
time over (ii) the Revolving Credit Outstandings at such time.
"Balance Sheet Date" - December 31, 1995.
"Bank of Boston" - The First National Bank of Boston, a national
banking association organized under the laws of the United States of America.
"Borrower" - as defined in the preamble hereof.
"Borrower Affiliated Companies" - collectively, the Borrower and each
of its Subsidiaries.
"Borrower Security Agreement" - the Borrower Security Agreement, dated
as of December 18, 1992, by and between the Borrower and the Collateral Trustee,
as amended by the First Amendment to Security Documents Agreement and as further
amended by the Second Amendment to Security Documents Agreement.
"Borrower Stock Pledge Agreement" the Borrower Stock Pledge Agreement,
dated as of December 18, 1992, by and between the Borrower and the Collateral
Trustee, as amended by the First Amendment to Security Documents Agreement and
as further amended by the Second Amendment to Security Documents Agreement.
"Borrower Subsidiaries" - collectively, (i) Saga Broadcast, (ii)
Franklin, (iii) Lakefront, (iv) Saga of Illinois, (v) Saga of Iowa, (vi)
Tidewater, (vii) Saga of New England, (viii) Saga Real Estate and (ix) Saga Quad
States.
"Borrower Subsidiary Security Agreement" - the Borrower Subsidiary
Security Agreement, dated as of December 18, 1992, by and among the Borrower
Subsidiaries and the Collateral Trustee, as amended by the First Amendment to
Security Documents Agreement and as further amended by the Second Amendment to
Security Documents Agreement.
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"Borrower Subsidiary Trademark Security Agreements" - (i) the Trademark
Collateral Assignment and Security Agreements dated as of May 12, 1994 by and
between the Collateral Trustee and certain Borrower Subsidiaries, as amended by
the Second Amendment to Security Documents Agreement and (ii) any additional
Trademark Collateral Assignment and Security Agreements from time to time
entered into by and between the Collateral Trustee and any Borrower
Subsidiaries.
"Borrower Trademark Security Agreement" - the Borrower Trademark
Collateral Assignment and Security Agreement, dated as of December 18, 1992, by
and between the Borrower and the Collateral Trustee, as amended by the First
Amendment to Security Documents Agreement and as further amended by the Second
Amendment to Security Documents Agreement.
"Borrowing Notice" - as defined in Section 2.2.
"Business Day" - any day other than Saturday, Sunday or any other day
on which commercial banks in Boston are authorized or required to close.
"Capital Expenditures" - as to any Person for any period, the sum of
all amounts which would, in accordance with GAAP consistently applied, be
included as additions to property, plant and equipment and other capital
expenditures on a consolidated statement of cash flows for such Person for such
period.
"Capital Stock" - any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all similar ownership interests in any Person which is not a corporation,
and any and all warrants, options or other rights to acquire any of the
foregoing.
"Capitalized Lease" - any lease or similar instrument the obligations
to pay rent or other amounts under which constitute Capitalized Lease
Obligations.
"Capitalized Lease Obligations" - as to any Person, the obligations of
such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) real and/or personal property which obligations are
required to be classified and accounted for as a capital lease on a balance
sheet of such Person under GAAP and, for purposes of this Agreement, the amount
of such obligations shall be the capitalized amount thereof, determined in
accordance with GAAP.
"Cash" - as to any Person, such Person's cash and cash equivalents, as
defined in accordance with GAAP.
"CERCLA" - the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
"Change in Control" - shall be deemed to have occurred if: (i) any
Person (other than a Permitted Holder) or any group (within the meaning of
Section 13(d)(3) of the Exchange Act) of Persons (other than any Permitted
Holders) shall have acquired beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission
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under the Exchange Act), directly or indirectly, in one or more transactions, of
Capital Stock of the Borrower (including other Capital Stock convertible into
such Capital Stock) representing 35% or more of the combined voting power of all
Capital Stock of the Borrower (on a fully-diluted basis) entitled to vote in the
election of directors, other than Capital Stock having such power only by reason
of the happening of a contingency, or (ii) a change in the composition of the
Board of Directors of the Borrower shall have occurred such that a majority of
the members of the Board of Directors are not Continuing Directors.
"Chief Financial Officer" - Norman L. McKee or such other individual as
may perform the duties of "chief financial officer" (as commonly understood) of
the Borrower.
"Christian" - Edward K. Christian.
"Christian Employment Agreement" - the employment agreement, dated as
of April 6, 1992, between Saga Broadcast and Christian, as assigned to and
assumed by the Borrower.
"Christian Note" - the promissory note dated December 10, 1992, in the
original principal amount of $690,700, issued by Christian to the Borrower, as
amended by the First Amendment to Promissory Note, dated as of December 6, 1995,
between the Borrower and Christian.
"Class A Common Stock" - the Class A Common Stock of the Borrower, par
value $.01 per share.
"Class B Common Stock" - the Class B Common Stock of the Borrower, par
value $.01 per share.
"Closing Costs" - for any period, all fees and costs (including legal,
accounting, appraisal, environmental site assessments and travel fees and costs)
incurred by any Borrower Affiliated Company in connection with the financing
contemplated by this Agreement or any Permitted Acquisition, in each case to the
extent expensed during such period.
"Code" - the Internal Revenue Code of 1986, as it may be amended from
time to time.
"Collateral" - collectively, all of the agreements, instruments,
contracts, assets, accounts, moneys and all of the income, proceeds and products
of any thereof, under or in respect of which the Agent or the Collateral
Trustee, for the benefit of the Lenders, shall have, at the time of reference to
the term "Collateral", any rights or interests as security for the payment or
performance of all or any part of the Obligations and shall, in any event,
include the Collateral (as defined in the respective Security Documents).
"Collateral Trust Agreement" - the Collateral Trust Agreement, dated as
of December 18, 1992, by and among the Collateral Trustee, the Lenders, the
Issuing Bank and the Agent, and countersigned by the Principal Companies, as
amended by the First
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Amendment to Collateral Trust Agreement and as further amended by the Second
Amendment to Collateral Trust Agreement.
"Collateral Trustee" - Bank of Boston, or any other Person succeeding
to the duties of Collateral Trustee under the Collateral Trust Agreement.
"Commitments" - as to any Lender, collectively, such Lender's Revolving
Credit Commitment, Term Loan A Commitment and Term Loan B Commitment.
"Common Stock" - collectively, (i) the Class A Common Stock, (ii) the
Class B Common Stock and (iii) any other Permitted Capital Stock having economic
attributes substantially equivalent to the Class A Common Stock and the Class B
Common Stock.
"Communications Act" - the Federal Communications Act of 1934, as
amended, and the rules and regulations of the FCC thereunder, as now or
hereafter in effect.
"Communications System" - all of the properties and operating rights
constituting a complete, fully integrated system for transmitting radio or
television signals from a transmitter licensed by the FCC, together with any
subsystem which is ancillary to such system.
"Consolidated or consolidated" - as to any term used in this Agreement,
the relevant figures for any Person and its Subsidiaries on a consolidated basis
determined in accordance with GAAP after eliminating all intercompany items and
minority interests.
"Consolidated Adjusted Net Income" - for any period, net earnings (or
loss) of the Borrower and its Subsidiaries determined on a consolidated basis in
accordance with GAAP, but excluding: (i) any net gain or loss arising from the
sale of capital assets; (ii) any gain arising from any write-up of assets; (iii)
net earnings of any Person (other than a wholly-owned Subsidiary of the
Borrower) in which the Borrower or any of its Subsidiaries has an ownership
interest unless such net earnings shall have actually been received by the
Borrower or wholly-owned Subsidiary in the form of cash distributions; (iv) any
extraordinary earnings or extraordinary losses, as such terms are interpreted
under GAAP; (v) any interest income of the Borrower or any of its Subsidiaries;
(vi) the effect of all barter transactions for such period; and (vii) proceeds
of any Interest Rate Contracts.
"Consolidated Current Assets"- as of any date, all assets (other than
Cash) of the Borrower and its Subsidiaries on a consolidated basis that, in
accordance with GAAP, are properly classified as current assets as of such date.
"Consolidated Current Liabilities" - as of any date, all liabilities of
the Borrower and its Subsidiaries on a consolidated basis maturing on demand or
within one (1) year from such date, and such other liabilities as of such date
as may properly be classified as current liabilities in accordance with GAAP.
"Consolidated EBITDA" - for any period (subject to any adjustments
required by Section 10.4 and determined on a consolidated basis in accordance
with GAAP), Consolidated Adjusted Net Income for such period plus (A) (to the
extent, but only to the
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extent, the following amounts have reduced Consolidated Adjusted Net Income for
such period) the sum of (i) Consolidated Total Interest Expense for such period,
(ii) the aggregate amount of all federal, state and local income taxes accrued
by the Borrower and its Subsidiaries for such period, (iii) the aggregate amount
of depreciation and amortization expense of the Borrower and its Subsidiaries
for such period, (iv) the aggregate amount of Closing Costs, if any, incurred by
the Borrower and its Subsidiaries during such period, to the extent that such
costs are non-recurring, and (v) the aggregate amount of any non-cash charges
during such period relating to the issuance or vesting of stock options granted
by the Borrower to its employees or directors minus (B) the sum of (i) the
aggregate amount of all cash television programming payments made by the
Borrower and its Subsidiaries during such period and (ii) the aggregate amount
of any cash payments made by the Borrower during such period relating to any
non-cash charges described in clause (A)(v) of this definition.
"Consolidated Net Operating Cash Flow" - for any period (subject to any
adjustments required by Section 10.4 and determined on a consolidated basis in
accordance with GAAP), Consolidated EBITDA for such period, minus (i) the
aggregate amount of all federal, state and local income taxes accrued by the
Borrower and its Subsidiaries during such period and (ii) the aggregate amount
of all Capital Expenditures made by the Borrower and its Subsidiaries during
such period (excluding the principal amount of Indebtedness incurred in
connection with such Capital Expenditures and permitted by this Agreement).
"Consolidated Total Funded Debt" - at any time, on a consolidated
basis, all Indebtedness for Borrowed Money of the Borrower and its Subsidiaries
at such time, determined in accordance with GAAP. The aggregate amount of
Consolidated Total Funded Debt at any time shall include all accrued interest
which has become due and payable but has not been paid (whether or not
capitalized) and the accreted amount of any Subordinated Debt issued with
original issue discount.
"Consolidated Total Interest Expense" - for any period (subject to any
adjustments required by Section 10.4), without duplication, the sum of (i) the
interest expense of the Borrower and its Subsidiaries for such period, (ii) the
interest component of Capitalized Lease Obligations of the Borrower and its
Subsidiaries for such period, and (iii) all Revolving Credit Commitment Fees,
Letter of Credit Fees and similar fees payable by the Borrower and its
Subsidiaries during such period in respect of Indebtedness for Borrowed Money;
in each case, determined on a consolidated basis in accordance with GAAP.
"Consolidated Working Capital" - as of any date, the excess of
Consolidated Current Assets over Consolidated Current Liabilities as of such
date.
"Continuing Directors" - as of any date of determination, any member of
the Board of Directors of the Borrower who (i) was a member of such Board of
Directors on the Effective Date or (ii) was nominated for election or elected to
such Board of Directors either with the affirmative vote of a majority of the
directors who were either members of such Board of Directors on the Effective
Date or whose nomination or election was previously so approved.
<PAGE> 17
-9-
"Contractual Obligations" - as to any Person, any provision of any
note, debenture or security issued by such Person or of any agreement,
indenture, mortgage, instrument or other undertaking to which such Person is a
party or by which it or any of its property is bound.
"Conversion Date" - June 30, 1998.
"Copyright" - collectively, all of the following, to the extent that
any Borrower Affiliated Company now or hereafter has any right, title or
interest therein: (i) all copyright rights in any work subject to the copyright
laws of the United States or any other country, whether as author, assignee,
licensee, transferee or otherwise, and (ii) all registrations and applications
for registration of any such copyright in the United States or any other
country, as well as all registrations, recordings, supplemental registrations
and pending applications for registration in the United States Copyright Office
or the copyright office of any other country.
"Credit Extensions" - collectively, (i) any Loan and (ii) any Letter of
Credit.
"Default" - an event which, with notice or lapse of time, or both,
would constitute an Event of Default.
"Default Rate" - with respect to any amounts payable hereunder or under
any of the other Loan Documents, a rate per annum equal to 2% above the rate of
interest otherwise applicable to such amounts.
"Distribution" - as to any Person, any direct or indirect: (i)
declaration or payment of any dividend on or in respect of any Capital Stock of
such Person (except, in the case of the Borrower, a dividend payable solely in
shares of Permitted Capital Stock); (ii) redemption, purchase or other
retirement or acquisition of any Capital Stock of such Person, through a
Subsidiary of such Person or otherwise; or (iii) return of capital by such
Person to its shareholders or other equityholders as such; or (iv) other
distribution on or in respect of any Capital Stock of such Person (except, in
the case of the Borrower, any distribution made by the Borrower solely in shares
of Permitted Capital Stock in connection with any stock split or reverse stock
split).
"Dollars" and "$" - lawful money of the United States of America.
"Drawdown Date" - the date on which any Credit Extension is made or is
to be made.
"Effective Date" - the date on which this Agreement becomes effective.
"Effective Date Certificate" - a certificate, to be dated as of the
Effective Date, executed and delivered to the Agent by the Borrower,
substantially in the form attached hereto as Exhibit D.
<PAGE> 18
-10-
"Employee Benefit Plan or Plan" - any employee benefit plan within the
meaning of Section3(3) of ERISA maintained or contributed to by any Principal
Company or any ERISA Affiliate, other than a Multiemployer Plan.
"Environmental Laws" - any judgment, decree, order, law, license, rule
or regulation pertaining to environmental matters, including without limitation
those arising under the Resource Conservation and Recovery Act ("RCRA"), CERCLA,
the Superfund Amendments and Reauthorization Act of 1986 ("SARA"), the Federal
Clean Water Act, the Federal Clean Air Act, the Toxic Substances Control Act,
any state or local statute, regulation, ordinance, order or decree relating to
health, safety or the environment, or any law or regulation of any foreign
jurisdiction outside the United States relating to health, safety or the
environment.
"Environmental Liability" - any liability under any Environmental Laws
for any release of a Hazardous Substance, and any liability for the costs of any
clean-up or other remedial action.
"Environmental Matter(s)" - a release of any Hazardous Substance into
the environment or the generation, treatment, storage or disposal of any
Hazardous Substance.
"Environmental Proceeding" - any judgment, action, proceeding or
investigation pending before any Governmental Authority, including any
environmental regulatory body, with respect to or threatened against or
affecting any Borrower Affiliated Company or relating to the Assets or
liabilities of any of them, including in respect of any "facility" owned, leased
or operated by any of them under CERCLA or under any Requirement of Law in
respect thereof, or in connection with any release of any Hazardous Substance or
the generation, storage or disposal of any Hazardous Substance.
"EPA" - The United States Environmental Protection Agency.
"ERISA" - the Employee Retirement Income Security Act of 1974, as it
may be amended from time to time, and the regulations promulgated thereunder.
"ERISA Affiliate" - any Person which is treated as a single employer
with the Borrower and its Subsidiaries under Section414 of the Code.
"ERISA Reportable Event" - a reportable event with respect to a
Guaranteed Pension Plan within the meaning of Section4043 of ERISA.
"Eurocurrency Reserve Requirements" - for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the rates (expressed as
a decimal fraction) of reserve requirements in effect on such day (including,
without limitation, basic, supplemental, marginal and emergency reserves under
any regulations of the Board of Governors of the Federal Reserve System or other
Governmental Authority having jurisdiction with respect thereto) prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of such Board) maintained by a member bank of such System.
<PAGE> 19
-11-
"Eurodollar Base Rate" - with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the interest rate per annum (rounded
upward, if necessary, to the nearest 1/16th of 1%) at which the Agent is offered
Dollar deposits at or about 10:00 a.m., Boston time, two (2) Business Days prior
to the beginning of such Interest Period in the Eurodollar Interbank Market
where the eurodollar and foreign currency and exchange operations in respect of
its Eurodollar Loans are then being conducted for delivery on the first day of
such Interest Period, for the number of days comprised therein and in an amount
comparable to the amount of its Eurodollar Loan to be outstanding during such
Interest Period.
"Eurodollar Business Day" - a Business Day on which dealings in Dollar
deposits are carried out in the Eurodollar Interbank Market.
"Eurodollar Interbank Market" - any lawful offshore market in which
deposits of Dollars are offered by foreign branches of U.S. banking institutions
and by foreign banking institutions to each other.
"Eurodollar Loans" - Loans the rate of interest applicable to which is
determined on the basis of the Eurodollar Rate.
"Eurodollar Rate" - with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum determined for such day
in accordance with the following formula (rounded upward, if necessary, to the
nearest 1/100th of 1%):
Eurodollar Base Rate
1.00 - Eurocurrency Reserve Requirements
"Event of Default" - as defined in Article XI hereof.
"Excess Cash Flow" - for any period, Consolidated EBITDA for such
period minus, without duplication, the sum of (i) the provision for income taxes
reported by the Borrower on its consolidated financial statements for such
period in accordance with GAAP (other than any such income taxes attributable to
gains on sales of Capital Assets), (ii) all Capital Expenditures of the Borrower
and its Subsidiaries made and permitted hereunder during such period (excluding
the principal amount of Indebtedness incurred in connection with such Capital
Expenditures), (iii) Consolidated Total Interest Expense for such period
required to be paid in cash by the Borrower or any of its Subsidiaries during
such period, (iv) the aggregate amount of mandatory permanent payments or
prepayments of principal of Consolidated Total Funded Debt during such period
(other than any Net Proceeds Payments and Excess Cash Flow Payments, (v) the
excess of Consolidated Working Capital as at the last day of such period over
Consolidated Working Capital as at the day before the first day of such period
and (vi) $1,000,000.
"Excess Cash Flow Payment" - as defined in Section 2.5(c).
"Exchange Act" - the Securities and Exchange Act of 1934, as amended.
"Existing Credit Agreement" - as defined in the recitals hereto.
<PAGE> 20
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"Existing Lenders" - as defined in the recitals hereto.
"Existing Loans" - means, collectively, the outstanding Term Loans and
Revolving Credit Loans (as such terms are defined in the Existing Credit
Agreement) made by the Existing Lenders under the Existing Credit Agreement.
"Facilities" - as defined in the recitals hereto.
"FASB" - the Financial Accounting Standards Board, and its predecessor
and successor organizations.
"FCC" - the Federal Communications Commission, or any successor agency,
commission, bureau, department or other Governmental Authority.
"FCC Licenses" - any radio, television or other license, permit,
certificate of compliance, franchise, approval or authorization granted or
issued by the FCC.
"FDIC" - the Federal Deposit Insurance Corporation or any successor
thereof.
"Federal Funds Rate" - for any period, a fluctuating interest rate per
annum (based on a 365 day or 366 day year, as the case may be) equal for each
day during such period to the average of the rates of interest charged on
overnight federal funds transactions, with member banks of the Federal Reserve
System only, as published for any day which is a Business Day by the Federal
Reserve Bank of New York (or, in the absence of such publication, as reasonably
determined by the Agent).
"Fee Letter" - a letter agreement, dated as of April 15, 1996, by and
between the Agent and the Borrower regarding payment of certain fees to the
Agent.
"Fees" - collectively, (i) the Agent's fee payable from time to time by
the Borrower to the Agent, for the Agent's own account, as provided in the Fee
Letter, (ii) the Revolving Credit Commitment Fees and (iii) the Letter of
Credit Fees.
"Final" - as to an action by the FCC or its staff, the date on which
the time for rehearing, reconsideration, review or appeal of such action shall
have expired without objection or claim by any Person.
"Financial Statements" - any financial statements from time to time
delivered by the Borrower to the Agent or to any Lender pursuant to the
provisions of this Agreement, including any financial statements and schedules
thereto delivered by the Borrower on the Effective Date. As used herein,
"Financial Statements" do not include any Projections.
"First Amendment to Collateral Trust Agreement" - the Amendment to
Collateral Trust Agreement, dated as of May 12, 1994, by and among the
Collateral Trustee, the Lenders, the Issuing Bank and the Principal Companies
(other than Saga Quad States).
<PAGE> 21
-13-
"First Amendment to Security Documents Agreement" - the Amendment to
Security Documents Agreement, dated as of May 12, 1994, by and among the
Collateral Trustee, the Lenders and the Principal Companies (other than Saga
Quad States).
"Franklin" - Franklin Communications, Inc., a Delaware corporation.
"Fully Diluted Shares" - at any time, the sum of (i) all shares of
Common Stock then issued and outstanding, plus (ii) (without duplication) the
maximum number of shares of Common Stock which would at any time be issuable
upon conversion of or in exchange for or upon exercise of rights under all
securities then issued and outstanding which are convertible into or
exchangeable for shares of Common Stock.
"GAAP" - when used in Article X hereof, whether directly or indirectly
by reference to a capitalized term used therein, principles which are consistent
with (i) the principles promulgated ar adopted by FASB, as in effect on the
Balance Sheet Date, and (ii) the accounting practices of Borrower and its
Subsidiaries reflected in the consolidated financial statements of Borrower and
its Subsidiaries as at and for the quarter ended on the Balance Sheet Date. When
used in general, other than as provided above, principles which are (i)
consistent with the principles promulgated or adopted by FASB, as in effect from
time to time, and (ii) consistently applied with past consolidated financial
statements of the Borrower and its Subsidiaries adopting the same principles. In
the event of any material change in the principles promulgated or adopted by
FASB after the Balance Sheet Date, the Principal Companies, the Agent and the
Lenders will undertake in good faith to negotiate appropriate changes to this
definition of GAAP and Article X hereof with the objective of having the
Principal Companies' compliance with the provisions of Article X determined by
reference to GAAP as in effect after such change, rather than GAAP as in effect
on the Balance Sheet Date. Until such changes have been agreed to in writing by
the Borrower and the Required Lenders, the definition of GAAP and the provisions
of Article X shall remain unchanged and in full force and effect.
"Governing Documents" - as to any Person, the articles or certificate
of incorporation and by-laws or other organizational documents of such Person.
"Governmental Authority" - any nation or government, any state or other
political subdivision thereof, and any entity exercising any executive,
legislative, judicial, regulation, or administrative functions of or pertaining
to government.
"Guarantor(s)" - the Borrower Subsidiaries and any other Subsidiary of
the Borrower which assumes the obligations of a Guarantor under Article VI
hereof.
"Guaranteed Pension Plan" - any employee pension benefit plan within
the meaning of Section3(2) of ERISA maintained or contributed to by any Borrower
Affiliated Company or any ERISA Affiliate the benefits of which are guaranteed
on termination in full or in part by the PBGC pursuant to Title IV of ERISA,
other than a Multiemployer Plan.
"Guaranty" - in relation to any Person, any obligation, contingent or
otherwise, of such Person guarantying or having the economic effect of
guarantying any Indebtedness of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, and
<PAGE> 22
-14-
including any obligation of such Person, direct or indirect, (i) to purchase or
pay (or advance or supply funds for the purchase of payment of) such
Indebtedness or to purchase (or to advance or supply funds for the purchase of)
any security for the payment of such Indebtedness, (ii) to purchase property,
securities or services for the purpose of assuring the owner of such
Indebtedness of the payment of such Indebtedness or (iii) to maintain working
capital, equity capital or other financial statement condition or liquidity of
the primary obligor so as to enable the primary obligor to pay such
Indebtedness.
"Hazardous Substances" - any hazardous substances as defined by 42
U.S.C. Section9601(14), any pollutant or contaminant as defined by 42 U.S.C.
Section9601(33) and any toxic substance, oil or hazardous materials or other
chemicals or substances regulated by any Environmental Laws.
"Historical Financials" - as defined in Section 4.9(a).
"Immaterial Real Property" - real property owned by a Principal Company
other than Material Real Property.
"Increasing Lenders" - as defined in Section 2.26.
"Indebtedness" - with respect to any Person, all: (i) liabilities or
obligations, direct or contingent, which in accordance with GAAP would be
included in determining total liabilities as shown on the liability side of a
balance sheet of such Person at the date as of which Indebtedness is to be
determined, including contingent liabilities which, in accordance with GAAP,
would be set forth in a specific amount on the liability side of such balance
sheet, and Capitalized Lease Obligations of such Person; (ii) liabilities or
obligations of others for which such Person is directly or indirectly liable, by
way of Guaranty or otherwise; (iii) liabilities or obligations secured by Liens
on any assets of such Person, whether or not such liabilities or obligations
shall have been assumed by it; and (iv) liabilities or obligations of such
Person, direct or contingent, with respect to letters of credit issued for the
account of such Person and bankers acceptances created for such Person;
provided, however, that in the case of liabilities or obligations in respect of
which the holder has recourse only against certain assets of a Person,
Indebtedness in respect of such liabilities or obligations shall be limited to
the fair market value of the assets with respect to which recourse is not
prohibited.
"Indebtedness for Borrowed Money" - without duplication, all
Indebtedness with respect to any of the following: (i) money borrowed (whether
recourse or non-recourse), including principal, interest and premiums, (ii)
obligations evidenced by a bond, debenture, note or other like written
obligation to pay money, (iii) Capitalized Lease Obligations, (iv) obligations
under conditional sales or other title retention agreements or secured by any
Lien, (v) any letters of credit or similar instruments (including reimbursement
obligations with respect thereto), (vi) the deferred unpaid purchase price of
property or services, except trade payables and accrued expenses incurred in the
ordinary course of business, or (vii) any Guaranty of any or all of the
foregoing.
<PAGE> 23
-15-
"Indemnity, Contribution and Subrogation Agreement" - the Indemnity,
Contribution and Subrogation Agreement, dated as of the Effective Date, by and
among the Borrower Affiliated Companies, substantially in the form attached
hereto as Exhibit C.
"Initial Term Loans A" - as defined in Section 2.1.
"Intellectual Property Security Agreements" - collectively, (i) the
Borrower Trademark Security Agreement, and (ii) the Borrower Subsidiary
Trademark Security Agreements.
"Interest Coverage Ratio" - as defined in Section 10.3.
"Interest Period" - with respect to any Eurodollar Loan, each period
commencing on the date such Loan is made or converted from a Prime Rate Loan or
Prime Rate Loans, or the last day of the next preceding Interest Period with
respect to such Eurodollar Loan, and ending on the same day in the first,
second, third or sixth calendar month as the Borrower may select as provided in
Section 2.2, except that each such Interest Period which commences on the last
Eurodollar Business Day of a calendar month shall end on the last Eurodollar
Business Day of the appropriate subsequent calendar month.
Notwithstanding the foregoing: (i) each Interest Period which would
otherwise end on a day which is not a Eurodollar Business Day shall end on the
next succeeding Eurodollar Business Day (or, if such next succeeding Eurodollar
Business Day falls in the next succeeding calendar month, on the next preceding
Eurodollar Business Day); (ii) no more than seven (7) Interest Periods for
Eurodollar Loans shall be in effect at the same time; and (iii) no Interest
Period shall end after the Maturity Date. In the event that the Borrower fails
to select the duration of any Interest Period for any Loan within the time
period and otherwise as provided in Section 2.2, such Loans will be
automatically converted into a Prime Rate Loan on the last day of the preceding
Interest Period for such Loan.
"Interest Rate Contracts" - any interest rate swap, cap, collar or
other agreement or arrangement designed to provide protection against
fluctuation in interest rates.
"Investment" - in relation to any Person, all investments by such
Person, by stock purchase, capital contribution, loan, advance, Guaranty of any
Indebtedness of any other Person, acquisition by such Person of any
Communications System or any business or all or any substantial part of the
Assets of any other Person or any division or Subsidiary of such Person or the
transfer or sale of property by such Person (otherwise than in the ordinary
course of the business of such Person) to any other Person for less than payment
in full in cash of the transfer or sale price or the fair value thereof
(whichever of such price or value is higher).
"IRS" - Internal Revenue Service.
"Issue Date" - in relation to any Letter of Credit, the day on which
such Letter of Credit is issued or to be issued by the Issuing Bank for the
account of the Borrower pursuant to this Agreement.
<PAGE> 24
-16-
"Issuing Bank" - with respect to any Letter of Credit, Bank of Boston
and any successor issuing bank.
"Issuing Bank Fees" - as defined in Section 3.6.
"Lakefront" - Lakefront Communication, Inc., a Delaware corporation.
"Leases" - leases and subleases (other than Capitalized Leases),
licenses for the use of real property, easements, grants, pole attachment and
conduit or trench agreements and other attachment rights and similar instruments
under which any Borrower Affiliated Company has the right to use real or
personal property or rights of way.
"Lender Assignment Agreements" - means the assignment agreements, each
dated as of the Effective Date, between certain Existing Lenders and the Agent
and acknowledged by the Borrower, each in substantially the form of Exhibit H
attached hereto (with such changes thereto as may be agreed to by the applicable
Existing Lender and the Agent).
"Lenders" - as defined in the preamble hereof.
"Letter of Credit" - any irrevocable standby letter of credit issued or
to be issued by the Issuing Bank for the account of the Borrower upon the terms
and subject to the conditions contained in this Agreement.
"Letter of Credit Application" - as defined in Section 3.2(b).
"Letter of Credit Disbursement" - a disbursement by the Issuing Bank to
the beneficiary of a Letter of Credit in connection with a drawing thereunder.
"Letter of Credit Exposure" - at any time, the sum of (i) the aggregate
undrawn face amount of all Letters of Credit outstanding at such time, and (ii)
the aggregate amount of all drawings under Letters of Credit for which the
Issuing Bank shall not have been reimbursed by the Borrower as provided in
Section 3.4. The amount of any Lender's Letter of Credit Exposure at any time
shall be the product of (i) the Letter of Credit Exposure, multiplied by (ii)
such Lender's Percentage at such time.
"Letter of Credit Fees" - as defined in Section 3.6.
"Lien" - any mortgage, deed of trust, pledge, security interest,
encumbrance, lien or charge of any kind (including any agreement to give any of
the foregoing), any conditional sale or other title retention agreement, any
lease in the nature of any of the foregoing, and the filing of or agreement to
give any financing statement under the Uniform Commercial Code of any
jurisdiction.
"Loan(s)" - collectively, (i) Revolving Credit Loans, and (ii) Term
Loans. Loans of different types made or converted from Loans of other types on
the same day (or of the
<PAGE> 25
-17-
same type but having different Interest Periods) shall be deemed to be separate
Loans for all purposes of this Agreement.
"Loan Documents" - collectively (i) this Agreement, (ii) the Notes,
(iii) the Security Documents, (iv) the Indemnity, Contribution and Subrogation
Agreement, (v) each Assignment and Acceptance Agreement, (vi) the Transaction
Documents, (vii) the Letter of Credit Applications and (viii) any other
documents, instruments or agreements executed and/or delivered in connection
with the foregoing.
"Management Stockholder" - any Person that is directly or indirectly
the beneficial owner of more than ten percent (10%) of any class of Capital
Stock of the Borrower or that is a director or officer of the Borrower.
"Material Adverse Effect" - any of the following: (i) any material
adverse effect on the business, Assets, operations, prospects or condition,
financial or otherwise, of the Borrower Affiliated Companies taken as a whole,
(ii) any material impairment of the ability of any Principal Company to perform
any of its material obligations under any Loan Document, or (iii) any material
impairment of the validity or enforceability of any Loan Document or any
material impairment of the rights, remedies or benefits available to, the
Collateral Trustee, the Agent or any Lender under any Loan Document.
"Material Labor Dispute" - with respect to any Person, any strike, work
stoppage, material unfair labor practice claim or charge, arbitration or other
material labor dispute against or affecting such Person.
"Material Real Property" - any and all real property owned by a
Borrower Affiliated Company on which is located a tower, transmitter or antenna
system used in connection with the operations of any Station or Stations, if
(but only if) the aggregate Consolidated EBITDA attributable to such Station or
Stations for the Reference Period most recently ended equals or exceeds ten
percent (10%) of Consolidated EBITDA of the Principal Companies for such
Reference Period.
"Maturity Date" - June 30, 2003 or such earlier date on which all the
Commitments of the Lenders shall terminate in accordance with the terms hereof.
"Mortgages" - collectively, the instruments of mortgage executed and
delivered by the Borrower or any of its Subsidiaries in favor of the Collateral
Trustee (including any predecessors to Bank of Boston as collateral trustee)
from time to time with respect to Material Real Properties owned by the Borrower
or its Subsidiaries.
"Most Recent Reference Period" means the most recent Reference Period
for which financial statement of the Borrower and its Subsidiaries have been
delivered to the Lenders in compliance with Article VII hereof.
"Multiemployer Plan" - any multiemployer plan within the meaning of
Section3(37) of ERISA maintained or contributed to by any Person or any ERISA
Affiliate.
<PAGE> 26
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"Net Proceeds" - with respect to any Prepayment Event (i) the gross
amount of cash consideration payable to or receivable by any Borrower Affiliated
Company in respect of such Prepayment Event, less (ii) the amount, if any, of
all estimated taxes payable as a result of gain realized with respect to such
Prepayment Event, whether or not payable during the taxable year in which such
Prepayment Event occurred, and less (iii) estimated fees, commissions, costs and
other expenses (other than those payable to any Affiliate) which are incurred in
connection with such Prepayment Event and are payable by the seller or the
transferor of the assets or property to which such Prepayment Event relates, but
only to the extent not already deducted in arriving at the amount referred to in
clause (i). To the extent that the estimate of taxes payable, or fees,
commissions, costs and other expenses incurred, proves incorrect, an adjustment
shall be made by way of an additional payment to the Agent, for the ratable
benefit of the Lenders, or a credit against amounts payable in respect of any
future Prepayment Events, as applicable.
"Net Proceeds Payments" - as defined in Section 2.5(d).
"New Lenders" - as defined in the recitals hereto.
"New Mortgage Amendments" - the amendments to each of the Mortgages,
each of which is to be executed and delivered to the Collateral Trustee, in
substantially the form attached hereto as Exhibit F, on or prior to the
Effective Date.
"1992 Stock Option Plan" - the 1992 Stock Option Plan of the Borrower
pursuant to which the employees of the Borrower are eligible to receive grants
of options to purchase Common Stock.
"Notes" - collectively (i) the Term Loan A Notes, (ii) the Revolving
Credit Notes and (iii) the Term Loan B Notes.
"Obligations" - collectively, all of the Indebtedness, liabilities and
obligations, whether direct or indirect, joint or several, absolute or
contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, of any Principal
Company (i) to any Lender, the Issuing Bank, the Agent or the Collateral
Trustee, whether now existing or hereafter arising, whether or not currently
contemplated, arising under any Loan Document, and (ii) under any Interest Rate
Contract entered into with any Person that was a Lender or an Affiliate of any
Lender at the time such Person entered into such Interest Rate Contract.
"Participant" - as defined in Section 13.11(a).
"PBGC" - Pension Benefit Guaranty Corporation.
"Percentage" - as to any Lender, at any time, the percentage set forth
opposite such Lender's name on Schedule 1 hereto (or, if such Lender has
executed an Assignment and Acceptance Agreement, opposite such Lender's
signature on the most recent Assignment and Acceptance Agreement then executed
by it).
<PAGE> 27
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"Permitted Acquisition" - any Acquisition after the Effective Date by
any Borrower Affiliated Company of any Communications System so long as, in each
case, either the Required Lenders have given their written consent to such
Acquisition or:
(i) after giving effect to such Acquisition, the Assets
comprising such Communications System (as used in this definition, the
"Acquired Assets") shall be owned exclusively by the Borrower or a
wholly-owned Subsidiary of the Borrower;
(ii) if the Acquired Assets are owned by a newly-formed or
newly-acquired Subsidiary of the Borrower, such Subsidiary (and any
parent of such Subsidiary that is not already a Principal Company)
shall have executed and delivered to the Agent and the Lenders (A) an
accession agreement reasonably satisfactory to the Agent, pursuant to
the terms of which such Subsidiary (and such parent or parents, if
applicable) (1) becomes a party to this Agreement as a Principal
Company and as a Guarantor, becomes a party to the Borrower Subsidiary
Security Agreement as a Borrower Subsidiary, becomes a party to the
Indemnity, Contribution and Subrogation Agreement as a Borrower
Affiliated Company, and becomes a party to any other Loan Document as
the Agent may reasonably request, and (2) agrees to perform and observe
all of the obligations and covenants (including all obligations and
covenants contained in Article VI hereof) of a Principal Company and a
Guarantor hereunder, of a Borrower Subsidiary under the Borrower
Subsidiary Security Agreement, of a Borrower Affiliated Company under
the Indemnity, Contribution and Subrogation Agreement, and of the
appropriate party under any other Loan Document to which it becomes a
party and (B) a Borrower Subsidiary Trademark Security Agreement, if
applicable;
(iii) the Borrower shall have demonstrated to the reasonable
satisfaction of the Agent (based on, among other things, operating and
financial projections and pro forma financial statements delivered to
the Agent and certified by the Chief Financial Officer) that,
immediately after giving effect to the Acquisition (including the
making of any Loans and the incurrence of any Indebtedness required to
finance such Acquisition), all covenants (including all covenants
contained in Article X hereof) contained herein (A) would have been
satisfied on a pro forma basis as at the end of and for the Most Recent
Reference Period, and (B) will be satisfied on a pro forma basis
through the period ending two years after the date of Acquisition;
(iv) no Default or Event of Default is continuing immediately
prior to such Acquisition, and no Default or Event of Default would
result from such Acquisition;
(v) if the Total Consideration (as defined below) payable by
the Borrower Affiliated Companies in connection with such Acquisition
would be greater than $20,000,000, the Required Lenders have approved
such Acquisition in writing (the Required Lenders having no obligation
to do so);
(vi) the Agent shall have received satisfactory evidence that
the Communication System to be acquired has complied with, is in
compliance with, and, after the Acquisition, will be in compliance
with, in all material respects all
<PAGE> 28
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applicable Requirements of Law, including the Communications Act and
all Environmental Laws; and
(vii) prior to any such Acquisition, the Borrower shall have
delivered to the Agent the definitive acquisition agreement between the
applicable Borrower Affiliated Company and the applicable seller.
As used in this definition, "Total Consideration" means all consideration
payable by the Borrower Affiliated Companies in connection with any Acquisition,
including cash payments at closing, the principal amount of any promissory notes
issued by any Borrower Affiliated Company, the principal amount of any amounts
payable by any Borrower Affiliated Company in consideration for any non-compete
covenant, and the amount of any Indebtedness for Borrowed Money assumed by any
Borrower Affiliated Company but excluding any consideration paid by the issuance
of Permitted Capital Stock.
The purchase by any Borrower Affiliated Company of any Communication System
pursuant to any local market agreement or time brokerage agreement entered into
by such Borrower Affiliated Company in connection with any Permitted LMA
Transaction must satisfy all of the above requirements.
"Permitted Capital Stock" - Capital Stock of the Borrower with respect
to which the Borrower has no obligation to make any Distributions prior to the
payment in full in cash of all the Obligations.
"Permitted Holder" means (i) Christian or (ii) any of the Permitted
Transferees.
"Permitted LMA Transaction" - any agreement or arrangement pursuant to
which any Borrower Affiliated Company purchases broadcast time on any
Communications System (other than a Station) for the purpose of programming such
broadcast time or any other similar arrangement, so long as in each case, either
the Required Lenders have given their written consent to such transaction or:
(i) if such Borrower Affiliated Company has the obligation to
purchase such Communications System pursuant to or in connection with
such agreement, the requirements set forth in clauses (i) through (vii)
of the definition of "Permitted Acquisition" would be met; for purposes
of determining whether such agreement or arrangement would meet such
requirements, references in such clauses to the "Acquisition" or any
similar reference shall be deemed to refer to the Acquisition
contemplated by such agreement. This clause (i) shall not apply if such
Borrower Affiliated Company has a mere option to purchase such
Communication System;
(ii) the Borrower shall have demonstrated to the reasonable
satisfaction of the Agent that the Pro Forma Fixed Charges Coverage
Ratio (as defined in Section 10.2), after giving pro forma effect to
the transactions contemplated by such agreement or arrangement, shall
be not less than the ratio then required by Section 10.2; and
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(iii) no Default or Event of Default is continuing immediately
prior to the effectiveness of such agreement or arrangement, and no
Default or Event of Default would result from such agreement or
arrangement.
"Permitted Liens" - as to any Principal Company:
(i) Liens to secure taxes, assessments, levies or other
governmental charges imposed upon such Principal Company, to the extent
(in each case) that the payment thereof shall not at the time be
required to be made in accordance with the provisions of Section 8.1;
(ii) deposits or pledges made by such Principal Company in the
ordinary course of its business (A) to secure payment of workers'
compensation, unemployment insurance, or other forms of governmental
insurance or benefits, (B) to secure performance of bids, tenders,
statutory obligations, leases and contracts (other than contracts
relating to borrowed money), or (C) to secure surety, appeal, indemnity
or performance bonds, in each case in the ordinary course of business
of such Principal Company, and in each case only to the extent that
payment thereof shall not at the time be required to be made in
accordance with the provisions of Section 8.1;
(iii) Liens in respect of judgments or awards against such
Principal Company with respect to which such Principal Company shall
currently be processing an appeal or proceedings for review; provided,
that (A) appropriate reserves with respect thereto have been
established and maintained on the consolidated books of the Borrower
and its Subsidiaries in accordance with GAAP and (B) such Liens and
judgments do not constitute Events of Default described in Sections
11.1(i) or (p);
(iv) Liens of carriers, warehousemen, mechanics, landlords or
materialmen incurred in the ordinary course of the business of any
Principal Company, in each case for sums not at the time required to be
paid in accordance with provisions of Section 8.1; and
(v) easements, right-of-way, zoning and similar restrictions
and other similar encumbrances or title defects which, in the
aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or
interfere with the ordinary conduct of the business of any such
Principal Company.
"Permitted Sale" - any Sale by any Principal Company (i) in the
ordinary course of its business of immaterial Assets or obsolete or unusable
equipment, (ii) in the ordinary course of its business of other equipment as
long as such equipment is replaced by equipment of like function and comparable
value within a period of three months after the date of such Sale or (iii) in
the ordinary course of its business of Immaterial Real Property; provided,
however, that (A) the total consideration payable to or receivable by the
Principal Companies in connection with any Permitted Sale (1) is an amount not
less than the fair market of the Assets subject to such Sale and (2) consists of
at least 90% cash which is
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payable at the closing of such Sale, and (B) no Sale shall be deemed a Permitted
Sale if it occurs in connection with any Sale of a Communications System or
other business by any Borrower Affiliated Company.
"Permitted Subordinated Seller Debt" - Seller Debt incurred in
connection with any Permitted Acquisition which:
(i) is not (A) Guarantied in any manner by any Borrower
Affiliated Company unless such Guaranty is subordinated in right of
payment and exercise of remedies to the prior payment in full in cash
of all the Obligations, and any Indebtedness which refunds, refinances
or replaces the Obligations, pursuant to a subordination agreement
among the holder of such Seller Debt, the Borrower and the Agent which
is acceptable in all respects to the Agent and the Required Lenders; or
(B) secured by any Assets of any Borrower Affiliated Company;
(ii) requires no principal payments prior to one year after
the Maturity Date;
(iii) bears interest at a fixed annual rate not in excess of
the lower of (A) the average interest rate on all Eurodollar Loans
outstanding at the end of the month prior to the date of incurrence of
such Indebtedness, and (B) 10%;
(iv) is subordinated in right of payment and exercise of
remedies to the prior payment in full in cash of all the Obligations,
and any Indebtedness which refunds, refinances or replaces the
Obligations, pursuant to a subordination agreement among the holder of
such Seller Debt, the Borrower Affiliated Company and the Agent which
is acceptable in all respects to the Agent and the Required Lenders;
and
(v) is in a face amount at the time of incurrence thereof
which, when added to the aggregate amount of all principal payment
obligations of the Borrower in respect of any other Seller Debt, does
not exceed an amount equal to the lesser of (A) $3,000,000 and (B) 25%
of Consolidated EBITDA for the Most Recent Reference Period, after
giving pro-forma effect to the Permitted Acquisition pursuant to which
such Seller Debt was incurred, as if such Acquisition occurred on the
first day of such Reference Period.
"Permitted Transferees" - with respect to any Person, (i) any Affiliate
of such Person, (ii) the heirs, executors, administrators, testamentary
trustees, legatees or beneficiaries of any such Person or (iii) a trust, the
beneficiaries of which, or a corporation, partnership or other entity, the
stockholders or general or limited partners or other owners of which, include
only such Person or his or her spouse or lineal descendants, in each case to
whom such Person has transferred the beneficial ownership of any Capital Stock
of the Borrower.
"Person" - an individual, a corporation, a partnership, a joint
venture, a trust or unincorporated organization, a joint stock company or other
similar organization, a
<PAGE> 31
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government or any political subdivision thereof, a court, or any other legal
entity, whether acting in an individual, fiduciary or other capacity.
"Prepayment Event" - any Sale (other than a Permitted Sale) of any
Asset of any Borrower Affiliated Company (including Capital Stock of any
Subsidiary) which takes place at any time after the date hereof and pursuant to
which the gross amount of consideration payable to or receivable by the Borrower
Affiliated Companies exceeds $1,000,000.
"Prime Rate" - a fluctuating rate of interest per annum equal to the
greater of (i) the rate established by the Agent from time to time at its office
in Boston as its "base rate" and (ii) the Federal Funds Rate plus 1/2%; in each
case, including any applicable adjustments for reserves or FDIC requirements.
The Prime Rate is not necessarily intended to be the lowest rate of interest
determined by the Agent in connection with extensions of credit.
"Prime Rate Loans" - Loans which bear interest at a rate based upon the
Prime Rate.
"Principal Companies" - collectively, (i) the Borrower and (ii) the
Borrower Subsidiaries.
"Principal Office" - the principal office of the Agent in the United
States, presently located at 100 Federal Street, Boston, Massachusetts 02110.
"Prior Mortgage Amendments" - the amendments to each of the Mortgages
which were executed and delivered by certain Principal Companies to the
Collateral Trustee on or prior to May 12, 1994.
"Pro Forma Fixed Charges" - for any period, without duplication, the
sum of (i) all principal and interest scheduled to be paid by the Borrower or
any of its Subsidiaries during such period on account of Indebtedness for
Borrowed Money, (ii) all Revolving Credit Commitment Fees scheduled to be paid
by the Borrower during such period, (iii) the aggregate amount of Capital
Expenditures made by the Borrower or any of its Subsidiaries during the
Reference Period ending most recently prior to such period and (iv) the
aggregate amount of all federal, state or local income taxes scheduled to be
paid by the Borrower or any of its Subsidiaries during such period; calculated
assuming:
(A) that the aggregate principal amount of the Revolving
Credit Loans outstanding during such period will be equal to such
aggregate principal amount on the first day of such period;
(B) that, during such period, the interest rate on the Prime
Rate Loans will at all times be equal to the Prime Rate plus the
Applicable Margin then in effect for Prime Rate Loans on the first day
of such period;
(C) that any Eurodollar Loan outstanding on the first day of
such period shall bear interest at the Eurodollar Rate applicable to
such Loan on the first day of such period plus the Applicable Margin
then in effect for Eurodollar Loans on the first day of such period
until the Interest Period for such Eurodollar Loan expires;
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(D) that, except as provided in the foregoing clause (C), all
Loans shall bear interest during such period determined by reference to
the Prime Rate plus the Applicable Margin then in effect for Prime Rate
Loans on the first day of such period, and not the Eurodollar Rate;
(E) that the interest rate on all Indebtedness for Borrowed
Money (other than the Loans) of the Borrower or any of its Subsidiaries
during such period shall be the interest rate on such Indebtedness for
Borrowed Money on the first day of such period;
(F) that the amount of principal of the Term Loans payable by
the Borrower during such period will be equal to the aggregate amount
of payments of principal scheduled to be made on the Term Loans during
such period pursuant to Sections 2.5(a) and (b); and
(G) that the aggregate amount of all federal, state or local
income taxes scheduled to be paid by the Borrower or any of its
Subsidiaries during such period is equal to the greater of (i)
aggregate amount of federal, state or local income taxes paid or
payable by the Borrower or any of its Subsidiaries during the
corresponding prior period (excluding taxes resulting from capital
gains) and (ii) the aggregate amount of federal, state or local income
taxes projected by the Borrower to be paid or payable during such
period.
"Projections" - the projections of the Borrower delivered on or prior
to the Effective Date which shall be certified by the Chief Financial Officer
and identified as projections through the Maturity Date.
"Public Filings" - as defined in Section 7.5.
"Purchasing Lender" - as defined in Subsection 13.11(b).
"Quarterly Dates" - the last Business Day of each March, June,
September and December, the first of which shall be June 28, 1996.
"Reference Period" - each period of four consecutive fiscal quarters of
the Borrower.
"Regulation D" - Regulation D of the Board of Governors of the Federal
Reserve System, as the same may be amended or supplemented from time to time.
"Regulatory Change" - as to any Lender, any change after the date of
this Agreement in United States federal, state or foreign laws or regulations
(including Regulation D and the laws or regulations which designate any
assessment rate relating to certificates of deposit or otherwise) or the
adoption or making after such date of any interpretations, directives or
requests applying to a class of banks, including such Lender, of or under any
United States federal, state or foreign laws or regulations (whether or not
having the force of law) by any court or governmental or monetary authority
charged with the interpretation or administration thereof.
<PAGE> 33
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"Required Lenders" - at any time, Lenders holding in the aggregate at
least 66-2/3% of the sum of (i) the Revolving Credit Commitments at such time
and (ii) the aggregate principal amount of Term Loans outstanding at such time.
"Requirement of Law" - as to any Principal Company, (i) the Governing
Documents of such Principal Company, and (ii) any law, treaty, rule or
regulation (whether Federal, state, local or foreign) or determination of any
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Principal Company or any of its property or to which
such Principal Company or any of its property is subject.
"Restricted Payments" - with reference to any Borrower Affiliated
Company any (i) Distribution (other than any distribution of Class A Common
Stock to any Person in connection with such Person's conversion of any Class B
Common Stock owned by such Person into Class A Common Stock) or (ii) any
optional retirement, repurchase, defeasance or redemption of, any acquisition
for value of, or any repayment of, any Indebtedness for Borrowed Money (other
than Obligations) of any Borrower Affiliated Company other than as required by
scheduled repayment obligations.
"Revolving Credit Commitment" - with respect to each Lender, the amount
set forth on Schedule 1 hereto as the amount of such Lender's commitment to make
Revolving Credit Loans to the Borrower hereunder, as the same may be reduced
from time to time or terminated in accordance with the terms hereof; provided,
however, that if the WPOR Term Loan is not made on or prior to September 13,
1996, each Lender's Revolving Credit Commitment shall be automatically increased
by an amount equal to such Lender's Percentage of $10,000,000; and provided,
further, that on the Conversion Date each Lender's Revolving Credit Commitment
shall be permanently reduced such that the sum of the Lenders' Revolving Credit
Commitments shall not exceed $5,000,000 on and after such date.
"Revolving Credit Commitment Fees" - as defined in Section 2.8(a).
"Revolving Credit Loan(s)" - as defined in Section 2.1(a).
"Revolving Credit Note(s)" - as defined in Subsection 2.4(a).
"Revolving Credit Outstandings" - at any time, the sum of (i) the
aggregate principal amount of Revolving Credit Loans outstanding at such time,
and (ii) the Letter of Credit Exposure at such time.
"Saga Broadcast" - Saga Broadcasting Corp., a Delaware corporation.
"Saga Broadcast Stock Pledge Agreement" - the Stock Pledge Agreement,
dated as of December 10, 1992, by and between Saga Broadcast and the Collateral
Trustee, as amended by the First Amendment to Security Documents Agreement and
as further amended by the Second Amendment to Security Documents Agreement.
"Saga of Illinois" - Saga Communications of Illinois, Inc., a Delaware
corporation.
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"Saga of Iowa" - Saga Communications of Iowa, Inc., a
Delaware corporation.
"Saga of Iowa Pledge Agreement" - Saga of Iowa Pledge Agreement, dated
as of December 10, 1992, by and between Saga of Iowa and the Collateral Trustee,
as amended by the First Amendment to Security Documents Agreement and as further
amended by the Second Amendment to Security Documents Agreement.
"Saga of New England" - Saga Communications of New England, Inc., a
Delaware corporation.
"Saga Quad States" - Saga Quad States Communications, Inc., a Delaware
corporation.
"Saga Real Estate" - Saga Communications of Iowa Real Estate, Inc., a
Delaware corporation.
"Sale" - a sale, lease, transfer or other disposition of any Asset.
"Second Amendment to Collateral Trust Agreement" - the Amendment to
Collateral Trust Agreement, dated as of the Effective Date, by and among the
Collateral Trustee, the Lenders, the Issuing Bank and the Principal Companies,
substantially in the form attached hereto as Exhibit G.
"Second Amendment to Security Documents Agreement" - the Amendment to
the Security Documents Agreement, dated as of the Effective Date, by and among
the Lenders, the Collateral Trustee and the Principal Companies, substantially
in the form attached hereto as Exhibit B.
"Securities Act" - the Securities Act of 1933, as amended.
"Security Documents" - (i) the Collateral Trust Agreement, (ii) the
First Amendment to Collateral Trust Agreement, (iii) the Second Amendment to
Collateral Trust Agreement, (iv) the Stock Pledge Agreements, (v) the Borrower
Security Agreement, (vi) the Borrower Subsidiary Security Agreement, (vii) the
Intellectual Property Security Agreements, (viii) the Mortgages, (ix) the Prior
Mortgage Amendments, (x) the New Mortgage Amendments, (xi) the Indemnity
Contribution and Subrogation Agreement, (xii) the First Amendment to Security
Documents Agreement, (xiii) the Second Amendment to Security Documents Agreement
and (xiv) any other instruments or documents from time to time securing or
guaranteeing any of the Obligations or from time to time designated by the
Borrower and the Agent as Security Documents hereunder.
"Seller Debt" - Indebtedness (other than Loans or Letters of Credit) of
the Borrower (whether in respect of promissory notes, non-compete covenants or
otherwise) incurred in connection with any Acquisition.
"Seller Debt Documents" - all agreements, instruments or other
documents evidencing or relating to Seller Debt.
<PAGE> 35
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"Specified Default" - as of any date of determination, any Event of
Default (other than an Event of Default described in Sections 11.1(d), (f) or
(j)) which shall not have been remedied within five (5) days after notice
thereof shall have been given to the Borrower by the Agent.
"Stations" - collectively, (i) radio station WAQY-FM, licensed to
Springfield, Massachusetts; (ii) radio station WAQY (AM), licensed to East
Longmeadow, Massachusetts; (iii) radio stations WGAN (AM) and WMGX (FM) licensed
to Portland, Maine; (iv) radio stations WFEA (AM) and WZID (FM) licensed to
Manchester, New Hampshire, (v) radio stations WVKO (AM) and WSNY (FM) licensed
to Columbus, Ohio, (vi) radio station WKLH (FM) licensed to Milwaukee,
Wisconsin, (vii) radio station WNOR (AM) and WNOR-FM licensed to Norfolk,
Virginia, (viii) radio stations WLRW (FM) and WIXY (FM) licensed to Champaign,
Illinois, (ix) radio station WYMG (FM) licensed to Jacksonville, Illinois, (x)
radio stations KRNT (AM) and KSTZ (FM) licensed to Des Moines, Iowa, (xi) radio
stations KIOA AM and KIOA-FM licensed to Des Moines, Iowa, (xii) radio station
WYNZ (FM) licensed to Westbrook, Maine, (xiii) radio station WZAN (AM) licensed
to Portland, Maine, (xiv) radio station WQQL (FM) licensed to Springfield,
Illinois, (xv) radio stations WLZR (AM) and WLZR-FM licensed to Milwaukee,
Wisconsin, (xvi) radio station WAFX (FM) licensed to Suffolk, Virginia, (xvii)
television station KOAM - TV licensed to Pittsburg, Kansas and (xviii) radio
stations WNAX (AM) and WNAX-FM licensed to Yankton, South Dakota and (xix) any
other Communications Systems acquired by any Borrower Affiliated Company after
the Effective Date.
"Stock Pledge Agreements" - collectively, (i) Borrower Stock Pledge
Agreement, (ii) Saga Broadcast Stock Pledge Agreement and (iii) Saga of Iowa
Stock Pledge Agreement.
"Subordinated Debt" - collectively, (i) Permitted Subordinated Seller
Debt and (ii) any other unsecured Indebtedness for Borrowed Money of the
Borrower the principal amount of, the interest rate on and all other terms
(including covenants, events of default, remedies and subordination provisions)
which have been approved in writing by the Required Lenders.
"Subsidiary" - with respect to any Principal Company, any corporation,
partnership or joint venture whether now existing or hereafter organized or
acquired: (i) in the case of a corporation, of which a majority of the
securities having ordinary voting power for the election of directors (other
than securities having such power only by reason of the happening of a
contingency) are at the time owned by such Principal Company and/or one or more
Subsidiaries of such Principal Company, or (ii) in the case of a partnership or
joint venture in which such Principal Company is a general partner or joint
venturer or of which a majority of the partnership or other ownership interests
are at the time owned by such Principal Company and/or one or more of its
Subsidiaries. Unless the context otherwise requires, references in this
Agreement to "Subsidiary" or "Subsidiaries" shall be deemed to be references to
a Subsidiary or Subsidiaries of the Borrower.
"Taxes" - any federal, state or local taxes or tax liabilities.
"Term Loan(s) A" - as defined in Section 2.1(b).
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"Term Loan(s) B" - as defined in Section 2.1(c).
"Term Loans" - collectively, Term Loans A and Term Loans B.
"Term Loan A Commitment" - with respect to each Lender, the amount set
forth on Schedule 1 hereto as the amount of such Lender's commitment to make
Term Loans A to the Borrower in accordance with Section 2.1(b) hereof.
"Term Loan B Commitment" - with respect to each Lender, the amount of
such Lender's commitment to make a Term Loan B to the Borrower on the Conversion
Date.
"Term Loan A Payment Date" - as defined in Section 2.5(a).
"Term Loan B Payment Date" - as defined in Section 2.5(b).
"Term Loan A Note(s)" - as defined in Subsection 2.4(b).
"Term Loan B Note(s)" - as defined in Subsection 2.4(c).
"Term Notes - collectively, the Term Loan A Notes and the Term Loan B
Notes.
"Tidewater" - Tidewater Communications, Inc., a Delaware corporation.
"Total Funded Debt Leverage Ratio" - as defined in Section 10.1.
"Trademark" - collectively, all of the following, to the extent that
any Borrower Affiliated Company now or hereafter has any right, title or
interest herein: (i) all Trademarks, service marks, trade names, corporate
names, company names, business names, fictitious business names, trade styles,
trade dress, logos, other source or business identifiers, designs and general
intangibles or like nature, now existing or hereafter adopted or acquired, all
registrations and recordings thereof, and all registration and recording
applications filed in connection therewith, including registrations and
registration applications in the United States Patent and Trademark Office, or
any state of the United States, or in any country, as well as all extensions or
renewals thereof, and (ii) all goodwill associated therewith or symbolized
thereby, and (iii) all other assets, rights and interests that uniquely reflect
or embody such goodwill.
"Transaction" - the transactions contemplated by this Agreement and by
the other Transaction Documents.
"Transaction Documents" - (i) this Agreement, (ii) the Notes, (iii) the
Indemnity, Contribution and Subrogation Agreement, (iv) the Second Amendment to
Security Documents Agreement, (v) the Second Amendment to Collateral Trust
Agreement, (vi) the New Mortgage Amendments, and (vii) any other documents
executed or delivered in connection with the Transaction.
"Transfer Effective Date" - as defined in Section 13.11(b).
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"Transferee" - as defined in Section 13.11(f).
"Voting Stock" - Capital Stock the holders of which are at the time
entitled, as such holders, to vote for the election of a majority of the
directors (or persons performing similar functions) of the corporation,
association, trust or other business entity involved, whether or not the right
so to vote exists by reason of the happening of a contingency.
"Withers Consulting Agreement" - the Consulting Agreement,
dated November 13, 1992, between
Saga of Illinois and W. Russell Withers, Jr.
"WPOR Acquisition" - the purchase by the Borrower or one of its
Subsidiaries from Ocean Coast Properties, Inc. of radio stations WPOR AM/FM
licensed to Portland, Maine in accordance with that certain Asset Purchase
Agreement, dated as of March 7, 1996, between Saga of New England and Ocean
Coast Properties.
"WPOR Term Loans A" - as defined in Section 2.1.
Section 1.2. General Provisions Pertaining to Definitions. All terms of
an accounting character not specifically defined herein shall have the meanings
assigned thereto by GAAP. The definitions in this Article I shall apply equally
to both the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". All references herein to
Sections and Exhibits shall be deemed references to Sections of, and Exhibits
to, this Agreement unless the context shall otherwise require. Each reference
herein to a particular Principal Company shall include a reference to such
Person's successors and permitted assigns. References to any agreement,
instrument or document defined in this Article I refer to such agreement,
instrument or document as originally executed, or if subsequently varied,
replaced or supplemented from time to time, as so varied, supplemented or
replaced and in effect at the relevant time of reference thereto.
ARTICLE II
COMMITMENTS; LOANS; COLLATERAL
Section 2.1. Loans.
(a) Revolving Credit Loans. Each Lender hereby severally agrees,
on the terms and subject to the conditions of this Agreement, to make revolving
credit loans (individually, a "Revolving Credit Loan" and, collectively, the
"Revolving Credit Loans") to the Borrower from time to time from and after the
effectiveness of this Agreement until the Maturity Date in an aggregate
principal amount at any time outstanding up to, but not exceeding, the Revolving
Credit Commitment of such Lender at such time, minus such Lender's Letter of
Credit Exposure at such time. Subject to the terms and conditions of this
Agreement, from time to time from and after the effectiveness of this Agreement
until
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the Maturity Date, the Borrower may borrow, repay (provided that repayment of
Eurodollar Loans shall be subject to the provisions of Section 2.24) and
reborrow Revolving Credit Loans.
(b) Term Loans A. Upon the effectiveness of this Agreement,
certain Existing Loans shall be reallocated to the Lenders as described in
Section 2.26, and all Existing Loans shall automatically be converted into term
loans hereunder (the "Initial Term Loans A") such that, after such reallocation
and conversion, each Lender shall for all purposes be deemed to have made an
Initial Term Loan A to the Borrower on the Effective Date in a principal amount
equal to such Lender's Percentage of $44,000,000. In addition, each Lender
severally agrees, on the terms and subject to the conditions of this Agreement,
to make a term loan to the Borrower on or prior to September 13, 1996 in a
principal amount up to, but not exceeding, such Lender's Percentage of
$10,000,000 to finance the WPOR Acquisition (individually, a "WPOR Term Loan A"
and, collectively, the "WPOR Term Loans A") (each of the Initial Term Loans A
and the WPOR Term Loans A, being, individually, a "Term Loan A" and,
collectively, the "Term Loans A"). The Borrower shall not be entitled to
reborrow all or any part of the principal of any Term Loans A which shall be
paid or prepaid at any time.
(c) Term Loan B. Each Lender severally agrees, on the terms and
subject to the conditions of this Agreement, to make a term loan (individually,
a "Term Loan B" and, collectively, the "Term Loans B") to the Borrower on the
Conversion Date in a principal amount equal to such Lender's Percentage of
the lesser of (i) in the event that the WPOR Term Loans A have been made, an
amount equal to $51,000,000 and otherwise, an amount equal to $61,000,000 or
(ii) the aggregate outstanding principal amount of the Revolving Credit Loans on
the Conversion Date. The Borrower shall pay on the Conversion Date (i) principal
of the Revolving Credit Loans in an amount equal to the aggregate principal
amount of the Term Loans B made on such date, (ii) all interest accrued to such
date on the Revolving Credit Loans being repaid on such date, (iii) any
Revolving Credit Commitment Fees then accrued on the amount of reduction in the
Revolving Credit Commitments on such date and (iv) all other Fees payable on
such date. Any principal of the Revolving Credit Loans not paid on the
Conversion Date with proceeds of Term Loan B (as a result of the principal of
the Revolving Credit Loans exceeding the amount set forth in clause (i) of the
first sentence of this paragraph (c) on the Conversion Date prior to such
payment) will remain outstanding hereunder as Revolving Credit Loans. The
Borrower shall not be entitled to reborrow all or any part of the principal of
Term Loan B which shall be paid or prepaid at any time. The Borrower will
deliver to each Lender on or prior to the Conversion Date a Term B Note
satisfying the requirements of Section 2.4(c).
Section 2.2. Notices Relating to Loans; Requests for Eurodollar Loans.
(a) Notices Relating to Loans. The Borrower shall give the Agent
written or telephonic notice of each termination or reduction of the Revolving
Credit Commitments, each borrowing and prepayment of a Loan, each continuation
or conversion of a Loan (other than any conversion of Eurodollar Loans to Prime
Rate Loans upon the expiration of the Interest Period for such Eurodollar Loans)
and the duration of each Interest Period applicable to each Eurodollar Loan (in
each case, a "Borrowing Notice", which shall be in form and substance
satisfactory to the Agent). Each such notice shall be irrevocable and
<PAGE> 39
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shall be effective only if received by the Agent not later than 11 a.m., Boston
time, on the date which is;
(i) In the case of each notice of termination or
reduction and each notice of borrowing or prepayment of, or conversion
into, Prime Rate Loans, one (1) Business Day prior to the date of the
related termination, reduction, borrowing, prepayment or conversion;
and
(ii) In the case of each notice of borrowing or prepayment
of, continuation of or conversion into, Eurodollar Loans, or the
duration of an Interest Period for Eurodollar Loans, three (3)
Eurodollar Business Days prior to the date of the related borrowing,
prepayment, continuation or conversion.
Each such notice of termination or reduction shall specify the amount thereof.
Each such notice of borrowing, conversion, continuation or prepayment shall
specify the amount (subject to Section 2.1) and type of Loans to be borrowed,
converted, continued or prepaid (and, in the case of a conversion, the type of
Loans to result from such conversion), the date of borrowing, continuation,
conversion or prepayment (which shall be: (x) a Business Day in the case of each
borrowing or prepayment of Prime Rate Loans, and (y) a Eurodollar Business Day
in the case of each borrowing or prepayment of Eurodollar Loans and each
conversion of or into a Eurodollar Loan). Each such notice of the duration of an
Interest Period shall specify the Loans to which such Interest Period is to
relate. The Agent shall notify the Lenders of the content of each such Borrowing
Notice promptly after its receipt thereof. Any telephonic notice given under
this Section 2.2 shall be promptly (and in any event, within one (1) Business
Day) confirmed in writing delivered to the Agent, provided that the Lenders and
the Agent shall be fully entitled to rely on any telephonic notice believed by
the Agent to have been given by an authorized person on behalf of the Borrower.
(b) Requests for Eurodollar Rate Loans. The Borrower may request a
Loan in the form of a Eurodollar Loan only if compliance with Section 2.5 (with
the payments provided for therein being applied in accordance with subsection
2.5(f)) would not result in any portion of the principal amount of such
Eurodollar Loan being paid prior to the last day of the Interest Period
applicable thereto. No Lender shall have more than seven (7) Eurodollar Loans
outstanding at any one time.
Section 2.3. Disbursement of Loan Proceeds. Not later than 1:00 p.m.,
Boston time, on the date specified for each borrowing hereunder, each Lender
shall transfer to the Agent, by wire transfer or otherwise, but in any event in
immediately available funds, the amount of the Loan to be made by it on such
date, and the Agent, upon its receipt thereof, shall disburse such sum to the
Borrower by depositing the amount thereof in an account of the Borrower
designated by the Borrower maintained with the Agent.
Section 2.4. Notes.
(a) Revolving Credit Notes. The Revolving Credit Loans made by
each Lender shall be evidenced by a single promissory note of the Borrower
substantially in the form of Exhibit A-1 annexed hereto (each, a "Revolving
Credit Note" and, collectively, the
<PAGE> 40
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"Revolving Credit Notes"). Each Revolving Credit Note shall be dated the
Effective Date, shall be payable to the order of such Lender in a principal
amount equal to such Lender's Revolving Credit Commitment as of the
effectiveness of this Agreement, and shall otherwise be duly completed;
provided, however, that if the WPOR Term Loans A are not made on or prior to
September 13, 1996, the Borrower shall promptly thereafter execute and deliver
to the Lenders, in substitution for the existing Revolving Credit Notes held by
the Lenders, new Revolving Credit Notes reflecting each Lender's increased
Revolving Credit Commitment. The Revolving Credit Notes shall be payable as
provided in Section 2.5.
(b) Term Loan A Notes. The Term Loans A made by each Lender shall
be evidenced by a single promissory note of the Borrower substantially in the
form of Exhibit A-2 annexed hereto (each, a "Term Loan A Note" and ,
collectively, the "Term oan A Notes"). Each Term Loan A Note shall be dated the
Effective Date, shall be payable to the order of such Lender in a principal
amount equal to such Lender's Term Loan A Commitment as of the effectiveness of
this Agreement, and shall otherwise be duly completed. The Term Loan A Notes
shall be payable as provided in Section 2.5.
(c) Term Loan B Notes. The Term Loan B made by each Lender shall
be evidenced by a single promissory note of the Borrower substantially in the
form of Exhibit A-3 annexed hereto (each, a "Term Loan B Note" and,
collectively, the "Term Loan B Notes"). Each Term Loan B Note shall be dated the
Conversion Date, shall be payable to the order of such Lender in a principal
amount equal to the Term Loan B made by such Lender, and shall otherwise be duly
completed. The Term Loan B Notes shall be payable as provided in Section 2.5.
(d) Notations on Notes. Each Lender may enter on a schedule
attached to each of its Notes a notation with respect to each Loan evidenced
thereby of: (A) the date and principal amount thereof, (B) each payment and
prepayment of principal thereof, (C) whether such Loan is a Prime Rate Loan or a
Eurodollar Loan, and (D) the Interest Period for such Loan, if applicable. The
failure of any Lender to make a notation on the schedule to any of its Notes as
aforesaid shall not limit or otherwise affect the obligation of the Borrower to
repay the Loans in accordance with their respective terms as set forth herein.
Section 2.5. Mandatory Principal Payments.
(a) Scheduled Repayments of Term Loans A. The Borrower shall pay
to the Agent, for the accounts of the Lenders, principal of the Term Loans A in
consecutive quarterly installments payable on the last day of each March, June,
September and December (each such date a "Term Loan A Payment Date"), commencing
on September 30, 1997. The aggregate principal amount of the Term Loans A due on
each Term Loan A Payment Date shall be the amount obtained by (i) multiplying
(A) the aggregate principal amount of the Term Loans A on September 17 1996 by
(B) the percentage set forth below opposite the period during which such Term
Loan A Payment Date falls and (ii) dividing the result of clause (i) above by
the number of Term Loan A Payment Dates in such period:
<PAGE> 41
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<TABLE>
<CAPTION>
Period Reduction Percentage
------ --------------------
<S> <C>
09/30/97 - 12/31/97 2.5%
01/01/98 - 12/31/98 15.0%
01/01/99 - 12/31/99 15.0%
01/01/00 - 12/31/00 17.5%
01/01/01 - 12/31/01 20.0%
01/01/02 - 12/31/02 20.0%
03/31/03 5.0%
06/30/03 Term Loan A Matures
</TABLE>
The Term Loans A shall in any event mature on the Maturity Date. All principal
of, interest on and other amounts payable in respect of the Term Loans A will,
if not sooner paid, become and be absolutely due and payable on the Maturity
Date.
(b) Scheduled Repayments of Term Loans B. The Borrower shall pay
to the Agent, for the accounts of the Lenders, principal of Term Loan B in
consecutive quarterly installments payable on the last day of each March, June,
September and December (each such date a "Term Loan B Payment Date"), commencing
on June 30, 1998. The aggregate principal amount of the Term Loan B due on each
Term Loan B Payment Date shall be the amount obtained by (i) multiplying (A) the
original aggregate principal amount of Term Loan B on the Conversion Date
(before giving effect to the payments of principal of Term Loan B due on the
Conversion Date) by (B) the percentage set forth below opposite the period
during which such Term Loan B Payment Date falls and (ii) dividing the result of
clause (i) above by the number of Term Loan B Payment Dates in such period:
<TABLE>
<CAPTION>
Period Reduction Percentage
------ --------------------
<S> <C>
06/30/98 - 12/31/98 15.0%
01/01/99 - 12/31/99 20.0%
01/01/00 - 12/31/00 20.0%
01/01/01 - 12/31/01 20.0%
01/01/02 - 12/31/02 20.0%
03/31/03 2.5%
06/30/03 Term Loan B Matures
</TABLE>
The Term Loans B shall in any event mature on the Maturity Date. All principal
of, interest on and other amounts payable in respect of the Term Loans B will,
if not sooner paid, become and be absolutely due and payable on the Maturity
Date.
(c) Mandatory Payments from Excess Cash Flow. On March 30 of each
year, commencing March 30, 1997, the Borrower shall prepay Loans in an aggregate
principal amount equal to (i) if a Specified Default is continuing on such date
100% of Excess Cash Flow for the fiscal year of the Borrower most recently ended
and (ii) if no Specified Default is continuing on such date and if the Total
Funded Debt Leverage Ratio of the Borrower and its Subsidiaries at the end of
the fiscal year of the Borrower most recently ended is equal to or greater than
4.00:1.00, 40% of Excess Cash Flow for such fiscal year (each such payment being
referred to herein as an "Excess Cash Flow Payment"). Excess Cash Flow
<PAGE> 42
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Payments shall be applied as provided in Subsection 2.5(f). No Excess Cash Flow
Payment shall be required to be made pursuant to this paragraph (c) on March 30
of any year in the event that (a) no Specified Default is continuing on such
date and (b) the Total Funded Debt Leverage Ratio of the Borrower and its
Subsidiaries at the end of the fiscal year of the Borrower most recently ended
was less than 4.00:1.00.
(d) Mandatory Payments in Connection with Prepayment Events.
(i) The Borrower shall, not later than the Business Day next
following each day any Net Proceeds are received by any Borrower
Affiliated Company, pay to the Agent the amount of such Net Proceeds
(each such payment to the Agent being referred to herein as a "Net
Proceeds Payment" and the date of each such payment being referred to
herein as a "Net Proceeds Payment Date"). Each Net Proceeds Payment
shall be applied as provided in Subsection 2.5(f).
(ii) Notwithstanding the foregoing, at the option of the
Borrower and so long as no Default or Event of Default is continuing or
would result therefrom, the Borrower may, to the extent that it
reasonably expects to use Net Proceeds to finance Permitted
Acquisitions within nine months after the applicable Net Proceeds
Payment Date, elect not to repay the Loans with such Net Proceeds;
provided that such Permitted Acquisitions shall be consummated (A)
within nine months after the applicable Net Proceeds Payment Date or
(B) in the event the Borrower reasonably expects to use such Net
Proceeds to finance a Permitted Acquisition that will be consummated
before the expiration of an additional six month period and a Borrower
Affiliated Company has, prior to the expiration of the initial nine
month period, entered into a binding written agreement to make such
Permitted Acquisition, the earlier to occur of (1) the date which is
the last day of such additional six month period and (2) the date on
which such written agreement is terminated or is abandoned by any party
thereto or on which it becomes apparent that the Permitted Acquisition
will not be consummated within such additional six month period. In the
event the Borrower elects not to prepay the Loans with Net Proceeds,
the Borrower shall promptly deliver a certificate to the Agent setting
forth the amount of Net Proceeds the Borrower reasonably expects to use
to finance Permitted Acquisitions during the subsequent nine month
period. On the date which is nine months after the applicable Net
Proceeds Payment Date the Borrower shall (1) deliver a certificate to
the Agent setting forth the amount and use of Net Proceeds actually
used during such period and, if applicable, the amount of Net Proceeds
the Borrower reasonably expects to use to finance Permitted
Acquisitions during the additional six month period in accordance with
this paragraph (ii), and (2) deliver to the Agent for application in
accordance with paragraph (i) above any Net Proceeds not previously
used or not reasonably expected to be used during the additional six
month period. On the date which is fifteen months after the applicable
Net Proceeds Payment Date, the Borrower shall (1) deliver a certificate
to the Agent setting forth the amount and use of Net Proceeds actually
used during such period and (2) deliver to the Agent for application in
accordance with paragraph (i) above any Net Proceeds not previously
used. The Agent shall promptly forward to the Lenders all certificates
received by the Agent from the Borrower pursuant to this paragraph
(ii).
<PAGE> 43
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(e) Mandatory Payments if Revolving Credit Outstandings Exceed
Maximum Revolving Credit Commitments. Upon any reduction in the maximum
aggregate amount of the Revolving Credit Commitments, the Borrower agrees
immediately to repay principal of Revolving Credit Loans in such amount as may
be necessary so that the Revolving Credit Outstandings do not exceed the maximum
aggregate amount of the Revolving Credit Commitments, as so reduced.
(f) Application of Payments.
(i) All Excess Cash Flow Payments and all Net Proceeds
Payments (A) shall be applied first to Term Loans A and then (after all
principal of the Term Loans A has been paid in full), (1) if prior to
the Conversion Date, to principal of the Revolving Credit Loans and,
(2) if on or after the Conversion Date, to principal of Term Loans B
and then (after all principal of Term Loans B has been paid in full) to
principal of the Revolving Credit Loans, (B) applied to principal of
the Term Loans shall be applied to scheduled installments of the
appropriate Term Loan in the inverse order of maturity, and (C) applied
to Revolving Credit Loans shall immediately, automatically and
permanently reduce the aggregate Revolving Credit Commitments by the
amount of such payment.
(ii) Except as set forth in subparagraph (i) above and
Sections 2.20, 2.21 and 2.23, all payments and repayments made pursuant
to the terms hereof shall be applied (A) first to all (if any) amounts
(except principal, interest and Fees) due and payable under this
Agreement at such time, (B) then to payment of all Fees due and payable
at such time, (C) then to interest due and payable at such time, (D)
then to accrued interest and then to principal of Prime Rate Loans, (E)
then to principal of Eurodollar Loans and (F) finally, to all other
Obligations.
Section 2.6. Voluntary Reduction or Termination of Revolving Credit
Commitments; Voluntary Payments.
(a) Voluntary Reduction or Termination of Revolving Credit
Commitments. The Borrower shall be entitled to terminate or reduce the Revolving
Credit Commitments from time to time subject to the terms and conditions set
forth herein, including the terms of Section 2.5(e), provided that (i) the
Borrower must give notice of such termination or reduction to the Lenders as
provided in Section 2.2 and (ii) any partial reduction of the Revolving Credit
Commitments shall be in an integral multiple of One Million Dollars
($1,000,000). Any such termination or reduction shall be permanent and
irrevocable. Any such reduction shall not diminish the amount of any other
reduction in the Revolving Credit Commitments required by the other provisions
of this Agreement.
(b) Voluntary Prepayments. The Borrower shall be entitled to
prepay the Revolving Credit Loans or the Term Loans from time to time (in
accordance with Section 2.11), in whole or in part, without premium or penalty,
provided, that the Borrower must give notice of such payment to the Agent as
provided in Section 2.2. Optional prepayments of Revolving Credit Loans may,
subject to the terms and conditions hereof, including the borrowing limitation
imposed by the Revolving Credit Commitments, be reborrowed
<PAGE> 44
-36-
hereunder until the Maturity Date, provided, however, that (i) Eurodollar Loans
may be repaid only on the last day of an Interest Period for such Loans, and
(ii) all repayments of Loans or any portion thereof shall be made together with
payment of all interest accrued on the amount repaid through the date of such
repayment. Any such repayment shall not diminish the amount of any other
principal payments on the Revolving Credit Loans or the Term Loans required by
other provisions of this Agreement. All prepayments of Term Loans pursuant to
this paragraph (b) shall be applied to scheduled installments of the appropriate
Term Loan in inverse order of maturity.
Section 2.7. Interest.
(a) Prime Rate Loans. Each Prime Rate Loan shall bear interest at
the Prime Rate plus the Applicable Margin for Prime Rate Loans then in effect.
(b) Eurodollar Loans. Each Eurodollar Loan shall bear interest at
the Eurodollar Rate applicable to such Loan and the Interest Period therefor,
plus the Applicable Margin for Eurodollar Loans in effect on the first day of
such Interest Period.
(c) Default Rate. Notwithstanding the foregoing, during the
continuance of a Specified Default, the Borrower shall pay interest at the
applicable Default Rate on the principal of the Loans and (to the extent
permitted by law) interest and all other amounts payable hereunder or under any
of the other Loan Documents.
(d) Payment of Interest. Except as provided in the next sentence,
accrued interest on each Loan shall be payable: (i) in the case of each Prime
Rate Loan, quarterly in arrears on the Quarterly Dates, and (ii) in the case of
each Eurodollar Loan, on the last day of the Interest Period for such Loan (and,
if such Interest Period exceeds three months' duration, quarterly, on the
Quarterly Dates), and (iii) subject to Section 2.5(d), in the case of any Loan,
(A) upon any payment or prepayment thereof or the conversion thereof into a Loan
of another type (but only on the principal so paid, prepaid or converted) and
(B) on the Maturity Date, and (iv) in the case of the Revolving Credit Loans, on
the Conversion Date and the date of termination of the Revolving Credit
Commitments. Interest which is payable at the Default Rate shall be payable from
time to time on demand of the Agent or any Lender. Promptly after the
establishment of any interest rate provided for herein or any change therein,
the Agent will notify the Lenders and the Borrower thereof, provided that the
failure of the Agent to so notify the Borrower or the Lenders shall not affect
the obligations of the Borrower hereunder or under any of the Notes in any
respect.
Section 2.8. Fees.
(a) The Borrower shall pay to the Agent, for the accounts of the
Lenders, commitment fees ("Revolving Credit Commitment Fees") in an amount equal
to the product of (i) the daily average amount of the Available Revolving Credit
Commitments during the applicable calendar quarter and (ii) the annual rate set
forth in the table below based upon the Total Funded Debt Leverage Ratio for the
Reference Period ending immediately prior to such calendar quarter. The
Revolving Credit Commitment Fees shall be payable (i) quarterly in arrears on
the Quarterly Dates, (ii) on the Conversion Date, and (iii) on the date the
Revolving Credit Commitment terminates.
<PAGE> 45
-37-
<TABLE>
<CAPTION>
Total Funded Debt
Leverage Ratio Annual Rate
----------------- -----------
<S> <C>
Greater than or equal to 4.0:1.0 0.375%
Less than 4.0:1.0 0.250%
</TABLE>
(b) Fees. The Borrower shall pay to the Agent certain fees as
provided in the Fee Letter.
Section 2.9. Use of Proceeds of Loans. The Borrower hereby covenants,
warrants and represents as follows:
(a) The proceeds of the WPOR Term Loans A shall be used by the
Borrower solely to finance the WPOR Acquisition.
(b) All proceeds of Revolving Credit Loans shall be used by the
Borrower solely (i) to finance (A) Permitted Acquisitions, (B) on-going working
capital needs of the Borrower and its Subsidiaries and (C) transaction costs
incurred by the Borrower and its Subsidiaries in connection with the Transaction
and (ii) to repurchase shares of Class A Common Stock of the Borrower in
accordance with the terms and conditions of paragraph (c) of Section 9.5.
(c) All proceeds of Term Loans B shall be used solely to repay
principal of Revolving Credit Loans outstanding on the Conversion Date; and
(d) No part of the proceeds of any Loan will be used (directly or
indirectly) (i) to purchase or carry, or to extend credit to any Person or
Persons for the purpose of purchasing or carrying (A) any margin security or
margin stock (within the meaning of Regulations U and X of the Board of
Governors of the Federal Reserve System) or (B) any other stock of any class in
the capital of the Borrower, or (ii) otherwise in any manner which would be in
violation of such Regulations U or X.
Section 2.10. Computations. Interest on Eurodollar Loans and each Fee
(other than the Agency Fee) shall be computed on the basis of a year of 360 days
and actual days elapsed (including the first day but excluding the last) during
the period for which payable. Interest on Prime Rate Loans shall be computed on
the basis of a year of 365 or 366 days (as the case may be), and actual days
elapsed (including the first day but excluding the last) during the period for
which payable.
Section 2.11. Minimum Amounts of Borrowings, Conversions and
Prepayments. Except for borrowings of Revolving Credit Loans which exhaust the
full remaining amount of the Revolving Credit Commitments, the borrowing of Term
Loans A, the borrowing of Term Loans B on the Conversion Date, conversions or
prepayments of all Loans of a particular type, or conversions made pursuant to
Sections 2.19, 2.20(c) or 2.22, each borrowing, each conversion of Loans of one
type into Loans of another type and each
<PAGE> 46
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prepayment of principal of Loans hereunder shall be in an amount equal to an
integral multiple of $100,000, in the case of Prime Rate Loans, and an integral
multiple of $1,000,000, in the case of Eurodollar Loans (prepayments of
different types of Loans at the same time to be deemed separate borrowings,
conversions or prepayments for purposes of the foregoing, one for each type).
Section 2.12. Time and Method of Payments. All payments of principal,
interest, Fees and other amounts (including indemnities) payable by any
Principal Company hereunder shall be made in Dollars, in immediately available
funds, without deduction, set-off or counterclaim, to the Agent at its office at
its Principal Office on the date on which such payment shall become due;
provided, however, that any payment not received by the Agent by 1:00 p.m.,
Boston time, on the date made shall be deemed received on the next Business Day;
provided, however, that no Default shall be deemed to have occurred under
Section 11.1 if payment is received after l:00 p.m., Boston time, but prior to
5:00 p.m., Boston time, on the date on which such payment shall become due. The
Agent or any Lender for whose account any such payment is to be made may, but
shall not be obligated to, debit the amount of any such payment which is not
made by such time to any ordinary deposit account of the Borrower with the Agent
or such Lender, as the case may be. Each payment received by the Agent hereunder
for the account of a Lender shall be paid promptly to such Lender, in like
funds, for the account of such Lender's Applicable Lending Office for the Loan
in respect of which such payment is made. If any payment or principal or
interest becomes due on a day other than a Business Day, such payment may be
made on the next succeeding Business Day, and such extension shall be included
in computing interest in connection with such payment. All payments hereunder
and under the Notes shall be made without set-off or counterclaim and in such
amounts as may be necessary in order that all such payments shall not be less
than the amounts otherwise specified to be paid under this Agreement and the
Notes after withholding for or on account of (i) any present or future taxes,
levies, imposts, duties or other similar charges of whatever nature imposed by
any government or any political subdivision or taxing authority thereof, other
than any tax (except those referred to in clause (ii) below) on or measured by
the net income of the Lender to which any such payment is due pursuant to
applicable federal, state and local income tax laws, and (ii) deduction of
amounts equal to the taxes on or measured by the net income of such Lender
payable by such Lender with respect to the amount by which the payments required
to be made under this sentence exceed the amounts otherwise specified to be paid
in this Agreement and the Notes. Upon payment in full of any Note and, in the
case of any Revolving Credit Note, the termination of the Lender's Revolving
Credit Commitment, the Lender holding such Note shall mark the Note "Paid" and
return it to the Borrower.
Section 2.13. Lending Offices. The Loans of each type made by each
Lender shall be made and maintained at such Lender's Applicable Lending Office
for Loans of such type.
Section 2.14. Several Obligations. The failure of any Lender to make
any Loan to be made by it on the date specified therefor shall not relieve the
other Lenders of their respective obligations to make their Loans on such date,
but no Lender shall be responsible for the failure of any other Lender to make
Loans to be made by such other Lender.
<PAGE> 47
-39-
Section 2.15. Security.
(a) Collateral. In order to secure the payment and performance of
all the Obligations, it is the intention and understanding of each of the
parties hereto that the following Collateral has been or will be made available
to the Collateral Trustee on or prior to the Effective Date:
(i) The Borrower shall grant to the Collateral Trustee,
pursuant to the Borrower Stock Pledge Agreement, a first-priority
security interest in and to all of the Capital Stock of Saga of New
England, Saga Broadcast, Saga Quad States, and any other Subsidiary of
the Borrower whose Capital Stock is in the name of and directly owned
by the Borrower;
(ii) Saga Broadcast shall grant to the Collateral Trustee,
pursuant to the Saga Broadcast Stock Pledge Agreement, a first-priority
security interest in and to all of the Capital Stock of the
Subsidiaries of Saga Broadcast;
(iii) Saga of Iowa shall grant to the Collateral Trustee,
pursuant to the Saga of Iowa Stock Pledge Agreement, a first-priority
security interest in and to all of the Capital Stock of the
Subsidiaries of Saga of Iowa;
(iv) The Borrower shall grant to the Collateral Trustee,
pursuant to the Borrower Security Agreement, a first-priority security
interest (subject to Liens permitted by Section 9.2) in and to all of
its Assets of every description (other than those Assets set forth on
Schedule 4.4(a));
(v) The Borrower Subsidiaries shall grant to the Collateral
Trustee, pursuant to the terms of the Borrower Subsidiary Security
Agreement (to the maximum extent permitted by applicable law), a first
priority security interest (subject to Liens permitted by Section 9.2)
in and to all of their Assets of every description (other than those
Assets set forth on Schedule 4.4(a));
(vi) The Principal Companies shall grant to the Collateral
Trustee, pursuant to the terms of the Intellectual Property Security
Agreements, a first-priority security interest (subject to Liens
permitted by Section 9.2) in and to all of their intellectual property
of every description;
(vii) The Principal Companies shall grant to the Collateral
Trustee, a Lien on such interests in real property, and all
improvements now or hereafter located thereon, as are specified in the
Mortgages; and
(viii) The due payment and performance in full of the
Obligations shall be guaranteed to the Lenders by each of the Borrower
Subsidiaries, upon the terms and subject to the conditions contained in
Article VI hereof.
(b) Additional Collateral. It is also the intention and
understanding of the parties hereto that the Collateral Trustee shall be granted
additional Collateral from time to time pursuant to Sections 8.12 and 8.15 to
secure the payment and performance of all
<PAGE> 48
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the Obligations. The Principal Companies shall execute and deliver such other
agreements, instruments and documents as the Agent or the Collateral Trustee
(with the consent of the Agent) reasonably requests in order to effect the
purposes of the Security Documents and the other Loan Documents.
(c) Description of Collateral. Reference is hereby made to the
Loan Documents for a complete statement of the terms and provisions relating to,
and for a complete description of, the Collateral.
Section 2.16. Pro Rata Treatment Among Lenders. Except as otherwise
provided herein: (i) each borrowing of Revolving Credit Loans and Term Loans
will be made from the Lenders pro rata according to their respective
Commitments, as applicable; (ii) each payment of each Revolving Credit
Commitment Fee and Letter of Credit Fee (other than the Issuing Bank Fee) shall
be made for the account of the Lenders pro rata according to their respective
Percentages; (iii) each partial reduction of the Revolving Credit Commitments
shall be applied to the Revolving Credit Commitments of the Lenders pro rata
according to each Lender's respective Revolving Credit Commitment; (iv) each
conversion of Loans of a particular type under Section 2.19 (other than
conversions provided for by Section 2.22 or 2.23) will be made pro rata among
the Lenders holding Loans of such type according to the respective principal
amounts of such Loans held by such Lenders; (v) each payment and prepayment of
principal of or interest on Loans of a particular type will be made to the Agent
for the account of the Lenders holding Loans of such type pro rata in accordance
with the respective unpaid principal amounts of such Loans held by such Lenders;
(vi) each purchase by the Lenders of a participation in each Letter of Credit
issued by the Issuing Bank under Article III hereof will be made by the Lenders
pro rata according to each Lender's respective Revolving Credit Commitment; and
(vii) Interest Periods for Loans of a particular type shall be allocated among
the Lenders holding Loans of such type pro rata according to the respective
principal amounts of such Loans held by such Lenders.
Section 2.17. Non-Receipt of Funds by Agent. Unless the Agent shall
have been notified by a Lender or the Borrower (the "Payor") prior to the date
on which such Lender is to make payment to the Agent of the proceeds of a Loan
to be made by it hereunder or any Principal Company is to make a payment to the
Agent for the account of one or more of the Lenders, as the case may be (each
such payment being herein called a "Mandatory Payment"), which notice shall be
effective upon receipt, that the Payor does not intend to make the Mandatory
Payment to the Agent, the Agent may assume that the Mandatory Payment has been
made and may, in reliance upon such assumption (but shall not be required to),
make the amount thereof available to the intended recipient on such date and, if
the Payor has not in fact made the Mandatory Payment to the Agent, the recipient
of such payment shall, on demand, repay to the Agent the amount made available
to it together with interest thereon in respect of each day during the period
commencing on the date such amount was so made available by the Agent until the
date the Agent recovers such amount at a rate per annum equal to the Federal
Funds Rate for such day (when the recipient is a Lender) or equal to the rate of
interest applicable to such Loan (when the recipient is the Borrower).
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Section 2.18. Sharing of Payments and Set-Off Among Lenders. The
Borrower hereby agrees that, in addition to (and without limitation of) any
right of set-off, banker's lien or counterclaim a Lender may otherwise have,
each Lender shall be entitled, at its option, to offset balances held by it at
any of its offices against any principal of or interest on any of its Loans
hereunder, or any Fee payable to it, which is not paid when due (regardless of
whether such balances held by such Lender are then due to the Borrower), in
which case it shall promptly notify the Borrower and the Agent thereof, provided
that its failure to give such notice shall not affect the validity thereof. If a
Lender shall effect payment of any principal of or interest on any of its Loans
hereunder or any Fee payable to it, through the exercise of any right of
set-off, banker's lien, counterclaim or similar right, it shall promptly
purchase at par from the other Lenders participations in the corresponding
Obligations held by the other Lenders in such amounts, and make such other
adjustments from time to time as shall be equitable, to the end that all the
Lenders shall share the benefit of such payment pro rata in accordance with the
unpaid principal and interest on the Obligations held by each of them. To such
end all the Lenders shall make appropriate adjustments among themselves (by the
resale of participations sold or otherwise) if such payment is rescinded or must
otherwise be restored. The Borrower agrees that any Lender so purchasing a
participation in the Loans held by the other Lenders may exercise all rights of
set-off, banker's lien, counterclaim or similar rights with respect to such
participation as fully as if such Lender were a direct holder of Obligations in
the amount of such participation. Nothing contained herein shall require any
Lender to exercise any such right or shall affect the right of any Lender to
exercise and retain the benefits of exercising any such right with respect to
any other indebtedness or obligation of the Borrower.
Section 2.19. Conversion of Loans. The Borrower shall have the right to
convert Revolving Credit Loans of one type into Revolving Credit Loans of
another type or Term Loans of one type into Term Loans of another type (i.e.,
either Eurodollar or Prime Rate Loans) from time to time, provided that: (i) the
Borrower shall give the Agent notice of each such conversion as provided in
Section 2.2; (ii) Eurodollar Loans may be converted only on the last day of an
Interest Period for such Loans; (iii) except as required by Sections 2.20 or
2.23, no Prime Rate Loan may be converted into a Eurodollar Loan if on the
proposed date of conversion a Default or an Event of Default exists; and (iv) if
on the proposed date of any continuation of any Eurodollar Rate Loan a Default
or Event of Default is continuing, such Eurodollar Rate Loan shall be converted
into a Prime Rate Loan. The Agent shall notify the Lenders of the effectiveness
of such conversion, and the new interest rate to which the converted Loans are
subject, as soon as practicable after the conversion.
Section 2.20. Additional Costs; Capital Requirements.
(a) In the event that any existing or future law or regulation,
guideline or interpretation thereof, by any Governmental Authority charged with
the administration thereof, or compliance by any Lender or any Affiliate of any
Lender with any request or directive (whether or not having the force of law) of
any such Authority shall impose, modify or deem applicable or result in the
application of, any capital maintenance, capital ratio or similar requirement
against any Lender's Loans or Commitments hereunder, and the result of any such
event is to impose upon any Lender or any Affiliate of any Lender or
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increase any capital requirement applicable as a result of the making or
maintenance of such Lender's Loans or its Commitments or the obligation of the
Borrower hereunder with respect to such Commitments (which imposition of capital
requirements may be determined by such Lender's reasonable allocation of the
aggregate of such capital increases or impositions), then such Lender may make
demand on the Borrower and within 30 days after demand made by such Lender (a
copy of which demand shall be delivered to the Agent), the Borrower shall
immediately pay to such Lender from time to time as specified by such Lender
additional amounts which shall be sufficient to compensate such Lender for such
imposition of or increase in capital requirements together with interest on each
such amount from the date such payment becomes due until payment in full thereof
at the Default Rate, provided, however, that if such Lender does not make demand
on the Borrower within 90 days after becoming aware of such imposition or
increase in capital requirements, then such Lender may make demand only for such
additional amounts which shall be sufficient to compensate such Lender for such
imposition or increase in capital requirements for periods not preceding the day
90 days prior than the date on which demand is made. A certificate setting forth
in reasonable detail the amount necessary to compensate such Lender as a result
of an imposition of or increase in capital requirements submitted by such Lender
to the Borrower shall be conclusive, absent manifest error, as to the amount
thereof.
(b) In the event that any Regulatory Change shall: (i) change the
basis of taxation of any amounts payable to any Lender under this Agreement or
the Notes in respect of any Loans including, without limitation, Eurodollar
Loans (other than taxes imposed on the overall net income of such Lender); or
(ii) impose or modify any reserve, FDIC premium or assessment, special deposit
or similar requirements relating to any extensions of credit or other assets of,
or any deposits with or other liabilities of, such Lender (including any of such
Loans or any deposits referred to in the definition of "Eurodollar Base Rate" in
Article I hereof); or (iii) impose any other conditions affecting this Agreement
in respect of Loans, including, without limitation, Eurodollar Loans (or any of
such extensions of credit, assets, deposits or liabilities); and the result of
any event referred to in clause (i), (ii) or (iii) above shall be to increase
such Lender's costs of making or maintaining any Loans, including, without
limitation, Eurodollar Loans, or its Commitments, or to reduce any amount
receivable by such Lender hereunder in respect of any of its Eurodollar Loans,
or its Commitments (such increases in costs and reductions in amounts receivable
are hereinafter referred to as "Additional Costs") in each case, only to the
extent that such Additional Costs are not included in the Eurodollar Base Rate
applicable to such Eurodollar Loans, then such Lender may make demand on the
Borrower and within 30 days after demand made by such Lender (a copy of which
demand shall be delivered to the Agent), the Borrower shall pay to such Lender
from time to time as specified by such Lender, additional amounts which shall be
sufficient to compensate such Lender for such increased cost or reduction in
amounts receivable by such Lender from the date of such change, together with
interest on each such amount from the date such payment becomes due until
payment in full thereof at the Default Rate, provided, however, that if such
Lender does not make demand on the Borrower within 90 days after becoming aware
of such Regulatory Change, then such Lender may make demand only for such
additional amounts as shall be sufficient to compensate such Lender for
increased costs or reductions in amounts receivable by such Lender for periods
not preceding the day 90 days prior to such demand.
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(c) Without limiting the effect of the foregoing provisions of
this Section 2.20, in the event that, by reason of any Regulatory Change, any
Lender either: (i) incurs Additional Costs based on or measured by the excess
above a specified level of the amount of a category of deposits or other
liabilities of such Lender which includes deposits by reference to which the
interest rate on Eurodollar Loans is determined as provided in this Agreement or
a category of extensions of credit or other assets of such Lender which includes
Eurodollar Loans, or (ii) becomes subject to restrictions on the amount of such
a category of liabilities or assets which it may hold, then, if such Lender so
elects by notice to the Borrower (with a copy to the Agent), the obligation of
such Lender to make, and to convert Loans of any other type into, Loans of such
type hereunder shall be suspended until the date such Regulatory Change ceases
to be in effect (and all Loans of such type then outstanding shall be converted
into Prime Rate Loans or into Eurodollar Loans of another duration, as the case
may be, in accordance with Sections 2.19 and 2.23).
(d) Determinations by any Lender for purposes of this Section 2.20
of the effect of any Regulatory Change on its costs of making or maintaining
Loans or on amounts receivable by it in respect of Loans, and of the additional
amounts required to compensate such Lender in respect of any Additional Costs,
shall be set forth in writing in reasonable detail and shall be conclusive,
absent manifest error. Each Lender shall allocate any cost increases required by
this Section 2.20 among its customers in good faith and on an equitable basis.
(e) If any Lender makes demand pursuant to paragraphs (a) or (b)
of this Section 2.20, so long as no Event of Default shall have occurred and be
continuing and the Borrower has obtained from another Lender or another bank or
financial institution acceptable to the Agent a commitment to become a Lender
for all purposes under this Agreement and to assume all obligations of the
Lender to be replaced, the Borrower may require the Lender making such demand to
assign all of its rights and obligations under this Agreement, its Note and the
other Loan Documents to such other Lender or other bank or financial institution
pursuant to the provisions of Section 13.11(b); provided that, prior to or
concurrently with such replacement (i) the Borrower has paid to the Lender
making demand all principal, interest, fees and other amounts owed to such
Lender through such date of replacement, (ii) the Borrower has paid to the Agent
the registration and processing fee required to be paid by Section 13.11(d), and
(iii) all of the requirements for such assignment contained in Section 13.11(b),
including the receipt by the Agent of an executed Assignment and Acceptance
Agreement and other supporting documents, have been fulfilled.
Section 2.21. Limitation of Types of Loans. Anything herein to the
contrary notwithstanding, if, on or prior to the determination of an interest
rate for any Eurodollar Loans for any Interest Period therefor, the Required
Lenders determine (which determination shall be conclusive absent manifest
error):
(a) by reason of any event affecting the money markets in the
United States of America or the Eurodollar interbank market, quotations of
interest rates for the relevant deposits are not being provided in the relevant
amounts or for the relevant maturities for purposes of determining the rate of
interest for such Loans under this Agreement; or
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(b) the rates of interest referred to in the definition of "Eurodollar
Base Rate" in Article I hereof upon the basis of which the rate of interest on
any Eurodollar Loans for such period is determined do not accurately reflect the
cost to the Lenders of making or maintaining such Loans for such period;
then the Agent shall give the Borrower and each Lender prompt notice thereof
(and shall thereafter give the Borrower and each Lender prompt notice of the
cessation, if any, of such condition), and so long as such condition remains in
effect, the Lenders shall be under no obligation to make Loans of such type or
to convert Loans of any other type into Loans of such type and the Borrower
shall, on the last day(s) of the then current Interest Period(s) for the
outstanding Loans of the affected type either prepay such Loans in accordance
with Section 2.6 or convert such Loans into Loans of another type in accordance
with Section 2.19.
Section 2.22. Illegality. Notwithstanding any other provision in this
Agreement, in the event that it becomes unlawful for any Lender or its
Applicable Lending Office to: (i) honor its obligation to make Eurodollar Loans
hereunder, or (ii) maintain Eurodollar Loans hereunder, then such Lender shall
promptly notify the Borrower thereof (with a copy to the Agent), describing such
illegality in reasonable detail (and shall thereafter promptly notify the
Borrower and the Agent of the cessation, if any, of such illegality), and such
Lender's obligation to make Eurodollar Loans and to convert other types of Loans
into Eurodollar Loans hereunder shall, upon written notice given by such Lender
to the Borrower, be suspended until such time as such Lender may again make and
maintain Eurodollar Loans and such Lender's outstanding Eurodollar Loans shall
be converted into Prime Rate Loans (as shall be designated in a notice from the
Borrower to the Agent pursuant to Section 2.2) in accordance with Sections 2.19
and 2.23.
Section 2.23. Certain Conversions Pursuant to Sections 2.20 and 2.22.
If the Loans of any Lender or a particular type (Loans of such type are
hereinafter referred to as "Affected Loans" and such type is hereinafter
referred to as the "Affected Type") are to be converted pursuant to Section 2.20
or 2.22, such Lender's Affected Loans shall be converted into Prime Rate Loans
(the "New Type Loans") on the last day(s) of the then current Interest Period(s)
for the Affected Loans (or, in the case of a conversion required by Section
2.20(c) or Section 2.22 on such earlier date as such Lender may specify to the
Borrower with a copy to the Agent) and, until such Lender gives notice as
provided below that the circumstances specified in Section 2.20 or 2.22 which
gave rise to such conversion no longer exist:
(a) to the extent that such Lender's Affected Loans have been so
converted, all payments and prepayments of principal which would otherwise be
applied to such Affected Loans shall be applied instead to its New Type Loans;
(b) all Loans which would otherwise be made by such Lender as
Loans of the Affected Type shall be made instead as New Type Loans and all Loans
of such Lender which would otherwise be converted into Loans of the Affected
Type shall be converted instead into (or shall remain as) New Type Loans; and
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(c) if Loans of any of the Lenders other than such Lender which
are the same type as the Affected Type are subsequently converted into Loans of
another type (which type is other than New Type Loans), then such Lender's New
Type Loans shall be automatically converted on the conversion date into Loans of
such other type to the extent necessary so that, after giving effect thereto,
all Loans held by such Lender and the Lenders whose Loans are so converted are
held pro rata (as to principal amounts, types and, to the extent applicable,
Interest Periods) in accordance with their respective Revolving Credit
Commitments.
Section 2.24. Indemnification. The Borrower shall pay to the Agent for
the account of each Lender, upon the request of such Lender through the Agent,
such amount or amounts as shall compensate such Lender for any loss (including
loss of profit), cost or expense incurred by such Lender (as reasonably
determined by such Lender) as a result of:
(a) any payment or prepayment or conversion of a Eurodollar Loan
held by such Lender on a date other than the last day of an Interest Period for
such Eurodollar Loan; or
(b) any failure by the Borrower to borrow, prepay or convert a
Eurodollar Loan on the date for such borrowing, prepayment or conversion
specified in the relevant notice under Section 2.2,
such compensation to include, without limitation, an amount equal to: (i) any
loss or expense suffered by such Lender during the period from the date of
receipt of such early payment or prepayment or the date of such conversion or
failure to borrow or convert to the last day of such Interest Period if the rate
of interest obtainable by such Lender upon the redeployment of an amount of
funds equal to such Lender's pro rata share of such payment, prepayment or
conversion or failure to borrow or convert is less than the rate of interest
applicable to such Eurodollar Loan for such Interest Period, or (ii) any loss or
expense suffered by such Lender in liquidating Eurodollar deposits prior to
maturity which correspond to such Lender's pro rata share of such payment,
prepayment, conversion, failure to borrow or failure to convert. The
determination by each such Lender or the amount of any such loss or expense,
when set forth in a written notice to the Borrower, containing such Lender's
calculation thereof in reasonable detail, shall be presumed correct, in the
absence of manifest error.
Section 2.25. Waiver of Claims. The Principal Companies hereby waive
any and all claims, counterclaims, defenses and similar rights with respect to
the Existing Loans which any of the Principal Companies have or may have as of
the effectiveness of this Agreement based on all information available to the
Principal Companies at such time.
Section 2.26. Reallocation of Existing Loans.
(a) Pursuant to the Lender Assignment Agreements, immediately
prior to the effectiveness hereof, each Existing Lender which (i) is not a
Lender hereunder or (ii) is a Lender hereunder but whose aggregate principal
amount of Existing Loans (before giving effect to the Lender Assignment
Agreements) was greater than its initial principal amount of Initial Term Loans
A (as set forth on Schedule 1 hereto), sold and assigned to the Agent, and the
Agent purchased and assumed from such Existing Lender, all or a portion (as the
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case may be) of the rights and obligations of such Existing Lender under the
Existing Credit Agreement and the other Loan Documents (as defined in the
Existing Credit Agreement), including: (i) the Commitments (as defined in the
Existing Credit Agreement) of such Existing Lender immediately prior to the
effectiveness hereof, (ii) such Existing Lender's interests in the outstanding
Credit Extensions (as defined in the Existing Credit Agreement) immediately
prior to the effectiveness hereof and (iii) such Existing Lender's interests in
all unpaid interest, if any, with respect to Loans (as defined in the Existing
Credit Agreement) and other obligations accrued through the effectiveness hereof
and payable to such Existing Lender (collectively, the "Assigned Rights").
(b) In order to give effect to the assignment to (i) each New
Lender and (ii) each Existing Lender which is a Lender hereunder but whose
aggregate principal amount of Existing Loans (before giving effect to any
reallocation of Existing Loans pursuant to
this Section 2.26) is less than its initial principal amount of Initial Term
Loans A (as set forth on Schedule 1 hereto) (the "Increasing Lenders"), all as
contemplated hereunder, upon the effectiveness of this Agreement, the Agent
shall and does hereby sell and assign to each New Lender and each Increasing
Lender, and each New Lender and each Increasing Lender does hereby purchase and
assume from the Agent, a portion of the Assigned Rights held by the Agent such
that after such sale and assignment, each of the Lenders (including the New
Lenders and the Increasing Lenders) shall own a portion of the Existing Loans in
a principal amount equal to its initial principal amount of Initial Term Loans A
(as set forth on Schedule 1 hereto).
(c) Pursuant to the purchase and sale of the Assigned Rights under
this Section 2.26, each New Lender and Increasing Lender shall pay to the Agent,
upon the effectiveness of this Agreement, an amount equal to the aggregate
outstanding principal amount of the Existing Loans purchased by such New Lender
or Increasing Lender under this Section 2.26.
(d) Each of the Principal Companies acknowledges and agrees that
all Existing Loans assigned by the Agent to the New Lenders and the Increasing
Lenders pursuant to this Section 2.26 shall be entitled to all the benefits of
this Agreement and the other Loan Documents.
(e) The Agent (i) makes no representation or warranty and assumes
no responsibility with respect to any statements, warranties or representations
made in or in connection with the Existing Credit Agreement or any of the other
documents or instruments furnished pursuant thereto or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Existing
Credit Agreement or any other instrument or document furnished pursuant thereto,
other than that it is the legal and beneficial owner of the Assigned Interests
being assigned by it hereunder, that such interests are free and clear of any
adverse claim, and that the Agent has the requisite corporate power and
authority and all consents necessary to execute, deliver and perform such
assignment; and (ii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Borrower
Affiliated Company or the performance or observance by the Borrower or any other
Person of any of their obligations under the Existing Credit Agreement or any
other instrument or document furnished pursuant thereto.
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(f) Each Lender purchasing Existing Loans pursuant to this Section
2.26 represents and warrants that it has the requisite corporate power and
authority and all consents necessary to execute, deliver and perform such
purchase and acknowledges and agrees that such purchase is without recourse to
the Agent, except to the extent that the Agent breaches its representations and
warranties made pursuant to paragraph (e) above.
(g) Each Lender purchasing Assigned Rights pursuant to this
Section 2.26 (i) appoints and authorizes the Collateral Trustee to take such
action as collateral trustee on its behalf and to exercise such powers under the
Credit Agreement or any of the other Loan Documents as are delegated to the
Collateral Trustee by the terms thereof, together with such powers as are
reasonably incidental thereto; (ii) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Collateral
Trust Agreement or any of the other Loan Documents are required to be performed
by it as a Lender thereunder. Upon the effectiveness of this Agreement (i) each
New Lender and each Increasing Lender shall be a party to the Collateral Trust
Agreement and the other Loan Documents and, to the extent rights and obligations
have been transferred to it pursuant to this Section 2.26, shall have the rights
and obligations of a Lender thereunder; (ii) the Agent shall cease to be a party
to the Existing Credit Agreement and the Collateral Trust Agreement as a Lender.
ARTICLE III
LETTERS OF CREDIT
Section 3.1. Letter of Credit Commitment. On the terms and subject to
the conditions contained in this Agreement, the Issuing Bank shall from time to
time from and after the effectiveness hereof until the Maturity Date issue
Letters of Credit for the account of the Borrower.
Section 3.2. Issuance of Letters of Credit.
(a) The obligation of the Issuing Bank to issue any Letter of
Credit requested by the Borrower is subject to the following conditions (in
addition to conditions specified elsewhere in this Agreement):
(i) The Issuing Bank shall have no obligation to issue any
Letter of Credit if, after giving effect to such issuance, (A) the
Revolving Credit Outstandings would exceed the aggregate Revolving
Credit Commitments or (B) the Letter of Credit Exposure would exceed
$5,000,000.
(ii) The form and terms of each Letter of Credit and any
related documentation must be reasonably acceptable to the Issuing
Bank.
(iii) Each Letter of Credit by its terms must provide for
payment of drawings thereunder in Dollars and must expire on or prior
to the earlier to occur of (A) ten days prior to the Maturity Date and
(B) the first anniversary of the date of its issuance.
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(iv) Each Letter of Credit must be issued to support
obligations of one or more Principal Companies incurred in the ordinary
course of its or their business or in connection with any Permitted
Acquisition.
(v) Each Letter of Credit shall contain a provision permitting
the Issuing Bank to terminate such Letter of Credit upon 30 days' prior
written notice to the beneficiary thereof and authorizing such
beneficiary to draw up to the full undrawn amount of such Letter of
Credit during such 30-day period. The Issuing Bank agrees that it will
not give any such termination notice except in compliance with Section
11.4.
In determining compliance with clause (i) above, the Issuing Bank shall be
entitled to rely on information received by it from the Agent or the Borrower.
(b) Whenever the Borrower desires to have a Letter of Credit
issued, the Borrower will furnish to the Agent and the Issuing Bank a written
application therefor (each, a "Letter of Credit Application") which shall (i) be
received by the Agent and the Issuing Bank not less than three (3) Business
Days and not more than ten (10) Business Days prior to the Issue Date
of such Letter of Credit and (ii) specify (A) the Issue Date of such Letter of
Credit (which must be a Business Day), (B) the expiration date of such Letter of
Credit, (C) the name and address of the beneficiary of the Letter of Credit, (D)
the amount of such Letter of Credit, and (E) the purpose and proposed form of
such Letter of Credit. The Agent shall give each Lender prompt notice of its
receipt of each such application and the Issuing Bank shall give the Agent and
each Lender prompt notice of the issuance and amount of each Letter of Credit
and the expiration date of each Letter of Credit.
Section 3.3. Participation by Lenders.
(a) By the issuance of a Letter of Credit and without any further
action on the part of the Issuing Bank or the other Lenders in respect thereof,
the Issuing Bank hereby grants to each Lender, and each Lender hereby acquires
from the Issuing Bank, a participation in such Letter of Credit equal to such
Lender's Percentage of the face amount of such Letter of Credit, effective upon
the issuance of such Letter of Credit; provided, however, that no Lender shall
be required to acquire participations in Letters of Credit that would result in
its Percentage of all Revolving Credit Outstandings to be greater than its
Revolving Credit Commitment. In consideration and in furtherance of the
foregoing, each Lender hereby absolutely and unconditionally agrees to pay to
the Agent, for the account of the Issuing Bank, in accordance with Section 3.4
below, such Lender's Percentage of each Letter of Credit Disbursement; provided,
however, that no Lender shall be obligated to make any such payment with respect
to any wrongful payment or disbursement made under any Letter of Credit as a
result of the gross negligence or willful misconduct of the Issuing Bank.
(b) Each Lender acknowledges and agrees that its obligation to
acquire participations pursuant to paragraph (a) above in respect of Letters of
Credit is absolute and unconditional and shall not be affected by any
circumstances whatsoever, including the occurrence and continuance of an Event
of Default or Default hereunder, and that each
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such payment shall be made without any offset, abatement, withholding or
reduction whatsoever.
Section 3.4. Letter of Credit Disbursements.
(a) If the Agent has not received from the Borrower the payment
permitted pursuant to paragraph (b) of this Section 3.4 by 11:00 a.m., Boston
time, on the date on which the Issuing Bank has notified the Borrower that
payment of a draft presented under any Letter of Credit will be made, as
provided in such paragraph (b), the Agent shall promptly notify the Issuing Bank
and each other Lender of the Letter of Credit Disbursement and, in the case of
each Lender, its Percentage of such Letter of Credit Disbursement. Each Lender
shall pay to the Agent, not later than 1:00 p.m., Boston time, on such date (or,
if the Issuing Bank shall elect to defer reimbursement from the Lenders
hereunder, such later date as the Issuing Bank shall specify by notice to the
Agent and the Lenders), such Lender's Percentage of such Letter of Credit
Disbursement, which the Agent shall promptly pay to the Issuing Bank. The Agent
will promptly remit to each Lender its share of any amounts subsequently
received by the Agent from the Borrower in respect of such Letter of Credit
Disbursement; provided that amounts so received for the account of any Lender
prior to payment by such Lender of amounts required to be paid by it hereunder
in respect of any Letter of Credit Disbursement shall be remitted to the Issuing
Bank.
(b) If the Issuing Bank shall receive any draft presented under
any Letter of Credit, the Issuing Bank shall give notice thereof as provided in
paragraph (c) below. If the Issuing Bank shall pay any draft presented under a
Letter of Credit, the Borrower may (but shall not be required to) pay to the
Agent, for the account of the Issuing Bank, an amount equal to the amount of
such draft before noon, Boston time, on the Business Day on which the Issuing
Bank shall have notified the Borrower that payment of such draft will be made.
The Agent will promptly pay any such amounts received by it to the Issuing Bank.
If the Borrower shall not elect to make such payment, the Borrower shall pay to
the Agent, on behalf of the Issuing Bank, an amount equal to the Letter of
Credit Disbursement made by the Issuing Bank, together with interest thereon at
the rate then applicable to Prime Rate Loans pursuant to Section 2.7 from and
including the date of such Letter of Credit Disbursement to but excluding the
date of payment, on or prior to the date one Business Day following the date of
such Letter of Credit Disbursement.
(c) The Issuing Bank shall, promptly following its receipt
thereof, examine all documents purporting to represent a demand for payment
under a Letter of Credit to ascertain that the same appear on their face to be
in substantial conformity with the terms and conditions of such Letter of
Credit. The Issuing Bank shall as promptly as reasonably practicable give oral
notification, confirmed in writing, to the Agent and the Borrower of such demand
for payment and the determination by the Issuing Bank as to whether such demand
for payment was in accordance with the terms and conditions of such Letter of
Credit and whether the Issuing Bank has made or will make a Letter of Credit
Disbursement thereunder, provided that the failure to give such notice shall
not relieve the Borrower of its obligation to reimburse such Letter of Credit
Disbursement, and the Agent shall promptly give each Lender notice thereof.
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Section 3.5. Obligation to Repay Letter of Credit Disbursements, etc.
The Borrower assumes all risks in connection with the Letters of Credit and the
Borrower's obligation to repay Letter of Credit Disbursements shall be absolute,
unconditional and irrevocable under any and all circumstances and irrespective
of:
(i) any lack of validity or enforceability of any Letter of
Credit;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower or any other person may at any time have
against the beneficiary under any Letter of Credit, the Agent or the
Issuing Bank (other than the defense of payment in accordance with the
terms of this Agreement or a defense based on the gross negligence or
willful misconduct of the Issuing Bank) or any other Person in
connection with this Agreement or any other agreement or transaction;
(iii) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any
respect; provided that payment by the Issuing Bank under such Letter of
Credit against presentation of such draft or document shall not have
constituted gross negligence or willful misconduct of the Issuing Bank;
and
(iv) any other circumstance or event whatsoever, whether or not
similar to any of the foregoing; provided that such other circumstance or event
shall not have been the result of gross negligence of willful misconduct of the
Issuing Bank.
It is understood that in making any payment under a Letter of Credit
(A) the Issuing Bank's exclusive reliance as to any and all matters set forth
therein, including reliance on the amount of any draft presented under such
Letter of Credit, whether or not the amount due to the beneficiary equals the
amount of such draft and whether or not any document presented pursuant to such
Letter of Credit proves to be insufficient in any respect, if such document on
its face appears to be in order, and whether or not any such Letter of Credit
proves to be forged or invalid or any statement therein proves to be inaccurate
or untrue in any respect whatsoever and (B) any noncompliance in any immaterial
respect of the documents presented under a Letter of Credit with the terms
thereof, shall, in each case, not be deemed willful misconduct or gross
negligence of the Issuing Bank. It is further understood that in making any
payment under a Letter of Credit, the Issuing Bank's payment of any draft
presented under such Letter of Credit, if such document on its face is clearly
not in order, shall be deemed willful misconduct or gross negligence of the
Issuing Bank.
The Borrower absolutely and unconditionally agrees to hold the Issuing
Bank harmless from, and to indemnify the Issuing Bank immediately upon demand by
the Issuing Bank at any time and as often as the occasion therefor may require
against, any and all claims, demands, suits, actions, damages, losses, costs,
expenses and other liabilities whatsoever which shall at any time or times be
incurred or sustained by the Issuing Bank on account of, or in relation to, or
in any way in connection with, the Letters of Credit except that the Borrower
shall not be liable to the Lenders for any claims,
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demands, suits, actions, damages, losses, costs, expenses and other liabilities
resulting from the gross negligence or willful misconduct of the Issuing Bank.
Section 3.6 Letter of Credit Fees. The Borrower agrees to pay to the
Agent (a) for the accounts of the Lenders, a fee in an amount equal to the
product of (i) the average undrawn face amount of each Letter of Credit
outstanding during all or any part of the applicable calendar quarter multiplied
by (ii) an annual rate equal to the Applicable Margin for Eurodollar Rate Loans
during such calendar quarter and (b) for the account of the Issuing Bank, a fee
(the "Issuing Bank Fee") in an amount equal to the product of (i) the average
undrawn face amount of each Letter of Credit outstanding during all or any part
of the applicable calendar quarter multiplied by (ii) an annual rate equal to
0.125% (the fees described in clause (a) of this Section 3.6 and the Issuing
Bank Fees shall be referred to herein collectively as the "Letter of Credit
Fees"). Letter of Credit Fees shall be payable (i) quarterly in arrears on each
of the Quarterly Dates and (ii) on the earlier of the Maturity Date and the date
the Revolving Credit Commitments terminate.
Section 3.7 Letter of Credit Applications. To the extent that any
provision of any Letter of Credit Application is inconsistent with the
provisions of this Article III, the provisions of this Article III shall apply.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Principal Companies hereby jointly and severally represent and
warrant to the Lenders, the Agent and the Issuing Bank as follows:
Section 4.1. Organization, Etc. Each of the Borrower Affiliated
Companies (a) is duly organized, validly existing and in good standing under the
laws of its state of organization or incorporation, (b) has all corporate power
and authority, and all material licenses, permits, franchises, consents and
approvals, required to own its Assets and carry on its business as now conducted
and as proposed to be conducted, (c) is duly qualified to do business and is in
good standing as a foreign corporation in each jurisdiction where the nature of
its properties or its business requires such qualification unless the failure to
so qualify could not reasonably be expected to have a Material Adverse Effect.
Schedule 4.1 accurately and completely lists, as to (i) the Borrower: (A) its
state of incorporation, (B) the classes and number of authorized and outstanding
shares of its Capital Stock, and the number of shares of its Capital Stock owned
by each Management Stockholder and (C) the business in which it is engaged and
(ii) each of the other Borrower Affiliated Companies: (A) the state of
incorporation of each such corporation, (B) the classes and number of authorized
and outstanding shares of Capital Stock of each such corporation, and the owners
of such outstanding shares of Capital Stock, and (C) the business in which each
such corporation is engaged. All the issued and outstanding shares of Capital
Stock of each Borrower Affiliated Company have been duly and validly issued and
are fully paid and non-assessable. All the issued and outstanding shares of
Capital Stock of each Borrower Affiliated Company (except the Borrower), except
for the pledge of such Capital Stock pursuant to the Stock Pledge Agreements,
are owned by the Persons identified on
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Schedule 4.1, free and clear of any Liens or restrictions on transfer. Except as
set forth on Schedule 4.1 and except for the options granted to or to be granted
to employees of the Borrower Affiliated Companies under the 1992 Stock Option
Plan, there are no outstanding warrants, options, contracts or commitments of
any kind entitling any Person to purchase or otherwise acquire any Capital Stock
of any Borrower Affiliated Company nor are there outstanding any securities
which are convertible into or exchangeable for any Capital Stock of any Borrower
Affiliated Company. Except for the obligations of the Borrower, Saga Broadcast
and Saga of Iowa under the Stock Pledge Agreements, there are no outstanding
commitments, options, warrants, calls or other agreements (whether written or
oral) binding on any Borrower Affiliated Company to issue, sell, grant,
transfer, assign, mortgage, pledge or otherwise dispose of any Capital Stock of
any other Borrower Affiliated Company. Except as described in Schedule 4.1, no
shares of any Borrower Affiliated Company are subject to (A) any restrictions on
transfer pursuant to any Governing Documents of such Borrower Affiliated
Company, or (B) any shareholders agreements, voting trusts, voting agreements,
trust agreements, trust deeds, irrevocable proxies or any other similar
agreements or instruments (whether written or oral). The Principal Companies
shall promptly notify the Agent in writing of any changes which would make any
of the representations set forth in this Section 4.1 untrue, inaccurate or
incomplete.
Section 4.2. Power; Authority; Consents; No Conflicts. Each of the
Borrower Affiliated Companies has the power and corporate authority to execute
and deliver the Transaction Documents and to perform the Loan Documents and the
Ancillary Documents to which it is a party. The Borrower has the power to
borrow and request Letters of Credit hereunder and has taken all necessary
action to authorize the borrowings and requests for Letters of Credit hereunder
on the terms and conditions of this Agreement. Each of the Borrower Affiliated
Companies has taken all necessary action, corporate or otherwise, to authorize
the execution and delivery of the Transaction Documents and the performance of
the Loan Documents and the Ancillary Documents to which it is a party. The
execution and delivery by each Borrower Affiliated Company of each of the
Transaction Documents and the performance of each of the Loan Documents and each
of the Ancillary Documents to which it is or is to become a party do not and
will not (i) contravene or result in a breach of any Requirement of Law, (ii)
conflict with or result in a breach of or (with the giving of notice or lapse of
time, or both) a default under any Contractual Obligation of any Borrower
Affiliated Company, or (iii) result in or require the creation of any Lien on
any Assets of any Borrower Affiliated Company, except for Liens created pursuant
to the Security Documents. No consent or approval of any Person, no waiver of
any Lien or right of distraint or other similar right and no consent, license,
certificate of need, approval, authorization or declaration of any Governmental
Authority, including the FCC, is or will be required in connection with the
Transaction, the execution and delivery by the Borrower Affiliated Companies of
the Transaction Documents or the performance of the Loan Documents and the
Ancillary Documents, or the validity, enforcement or priority, of the Loan
Documents or any Lien created and granted thereunder, except as set forth on
Schedule 4.2, each of which either has been duly and validly obtained on or
prior to the date hereof and is now in full force and effect, or is designated
on Schedule 4.2 as waived by the Required Lenders.
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Section 4.3. Due Execution, Validity and Enforceability. Each
Transaction Document has been duly executed and delivered by each Borrower
Affiliated Company which is a party thereto and each of the Loan Documents and
the Ancillary Documents constitutes the legal, valid and binding obligation of
such Borrower Affiliated Company, enforceable in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
moratorium, reorganization or other similar laws affecting generally the
enforcement of creditors' rights or by general principles of public policy and
except to the extent that the availability of the remedy of specific performance
or injunctive relief is subject to the discretion of the court before which any
proceeding therefor may be brought.
Section 4.4. Priority of Liens; Condition of Assets.
(a) All the Assets owned by each Borrower Affiliated Company are owned
by it free and clear of any Lien, except Liens created by the Security
Documents, and Liens permitted by Section 9.2. Each of the Borrower Affiliated
Companies has granted to the Collateral Trustee a first-priority security
interest (to the maximum extent permitted by applicable law) subject only to
Liens permitted by Section 9.2 in all of its Assets, other than those Assets
described on Schedule 4.4(a) or excluded by the express terms of the Security
Documents. The Liens which have been created and granted by the Security
Documents, to the extent such Liens may be perfected by filing a financing
statement under the Uniform Commercial Code of the applicable jurisdiction, or
by recording an assignment with the U.S. Patent and Trademark Office, or by
taking possession of securities or instruments, or by recording a mortgage or
deed of trust in the real estate records of the applicable jurisdiction,
constitute valid perfected first-priority Liens on the Assets covered by the
Security Documents, subject to no prior or equal Lien except as permitted by
Section 9.2. All Assets of each Borrower Affiliated Company which are reasonably
necessary for the operation of its business are in good working condition,
ordinary wear and tear excepted, and are able to serve the function for which
they are currently being used. Each Borrower Affiliated Company enjoys peaceful
and undisturbed possession under all material leases of real and personal
property to which it is a party, and all such material leases are valid and
subsisting and in full force and effect.
(b) The Borrower Affiliated Companies are not engaged in any business
or activities other than (i) holding shares of capital stock of other Borrower
Affiliated Companies and (ii) acquiring, owning, operating and disposing of
Stations and engaging in Permitted LMA's.
(c) The only material instrument held by any Borrower Affiliated
Company as of the effectiveness of this Agreement is the Christian Note.
Section 4.5. Judgments, Actions, Proceedings. Except as set forth on
Schedule 4.5 or in the Historical Financials, there are no outstanding
judgments, actions or proceedings, including any Environmental Proceeding,
pending before any Governmental Authority (including the FCC) with respect to
or, to the best of the Principal Companies' knowledge, threatened against or
affecting any Borrower Affiliated Company or any Assets of any Borrower
Affiliated Company; to the best of the Principal Companies' knowledge, there is
no reasonable basis for the institution of any such action or proceeding against
any
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Borrower Affiliated Company or any Assets of any Borrower Affiliated Company;
there are no such actions or proceedings in which any Borrower Affiliated
Company is a plaintiff or complainant.
Section 4.6. No Defaults; Compliance with Laws. No Default or Event of
Default is continuing. No Borrower Affiliated Company is in default under or has
failed to comply with any Requirement of Law or any Contractual Obligation to
which it or any of its Assets are bound, except for such defaults or failures
which could not reasonably be expected to have a Material Adverse Effect. Each
Borrower Affiliated Company has complied and is in compliance in all respects
with each of its Governing Documents and in all material respects with the
Communications Act.
Section 4.7. Burdensome Documents. Except as set forth on Schedule 4.7,
no Borrower Affiliated Company is a party to or bound by, and no Assets of any
Borrower Affiliated Company are affected by, any Requirement of Law or any
Contractual Obligation which could have a Material Adverse Effect.
Section 4.8. Governing Documents. The Agent has been furnished with
true and complete copies of all Governing Documents of each Borrower Affiliated
Company.
Section 4.9. Financial Information.
(a) Financial Statements. All balance sheets, all statements of
operations and of cash flows, and all other financial statements which have been
furnished by or on behalf of any of the Principal Companies to the Agent or any
Lender for the purposes of or in connection with this Agreement or any
transaction contemplated hereby, including the audited consolidated and
consolidating balance sheets of the Borrower and its Subsidiaries at December
31, 1995 and the related audited consolidated and consolidating statements of
operations and cash flows for the fiscal year of the Borrower then ended,
certified, in the case of the consolidated statements, by Ernst & Young
(collectively, together with the notes thereto, the "Historical Financials"),
have been prepared in accordance with GAAP consistently applied throughout the
periods involved (except as disclosed therein) and present fairly the financial
position and the results of operations of the Borrower and its Subsidiaries as
at the date thereof and for the periods then ended. None of the Principal
Companies has any material contingent liability or liabilities for taxes,
long-term leases or unusual forward or long-term commitments which are not
reflected in the Historical Financials or in the notes thereto.
(b) Projections. The Projections have been prepared on the basis of the
assumptions accompanying them and reflect as of the date thereof the Borrower's
good faith projections, after reasonable analysis, of the matters set forth
therein, based on such assumptions.
Section 4.10. No Material Changes. Since the Balance Sheet Date, except
as disclosed in Public Filings previously delivered to the Lenders:
(a) There has been no change, and no development or event involving a
prospective change in the Assets, business, operations, prospects or condition,
financial or
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otherwise, of any Borrower Affiliated Company, which has had or could reasonably
be expected to have a Material Adverse Effect.
(b) No Borrower Affiliated Company has incurred any Indebtedness for
Borrowed Money, other than the Obligations, or any material other Indebtedness,
except Indebtedness arising in the ordinary course of business.
(c) No Distributions have been declared, paid or made upon any Capital
Stock of the Borrower, nor has any Capital Stock of any Borrower Affiliated
Company been redeemed, retired, purchased or otherwise acquired for value.
(d) There has been no sale, transfer or other disposition by any
Borrower Affiliated Company of any material part of its Assets and no purchase
or other acquisition of any Communications System or any other Assets material
in relation to the consolidated financial condition of the Borrower and its
Subsidiaries.
Section 4.11. Taxes. Each Borrower Affiliated Company has filed all
returns for Taxes required to be filed by it and has not failed to pay any
Taxes, or interest or penalties relating thereto, on or before the due dates
thereof. Except as set forth on Schedule 4.11 or in the Historical Financials or
in the Financial Statements or in the notes thereto, or in the Borrower's Public
Filings delivered to the Lenders: (i) there are no material liabilities for
Taxes of any Borrower Affiliated Company due or to become due and (ii) there are
no material claims pending or, to the knowledge of the Borrower, proposed or
threatened against any Borrower Affiliated Company for past Taxes, except those,
if any, as to which proper reserves are reflected in the Financial Statements.
Section 4.12. Intangible Assets. Each Borrower Affiliated Company
possesses all patents, Trademarks, Copyrights and rights with respect to the
foregoing necessary to conduct its business as now conducted and as proposed to
be conducted, without any known conflict with the patents, Trademarks,
Copyrights and rights with respect to the foregoing of any other Person, and
each of such patents, Trademarks, Copyrights and rights with respect thereto,
together with any pending applications therefor, are listed on Schedule 4.12.
Section 4.13. [INTENTIONALLY DELETED]
Section 4.14. Licenses and Approvals.
(a) Each Borrower Affiliated Company has all requisite power and
authority and necessary licenses and permits, including all FCC Licenses, to own
and operate the Assets (including Stations) owned or operated by it and to carry
on its businesses as now conducted.
(b) Set forth in Schedule 4.14 is a complete list of all FCC Licenses
of the Borrower Affiliated Companies. Each such FCC License which is necessary
to the operation of the business of any Borrower Affiliated Company is validly
issued and in full force and effect or to the extent described in Schedule 4.14,
special temporary authority has been sought from the FCC to operate the
facilities for which such FCC authority is
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required. Each Borrower Affiliated Company has fulfilled and performed all of
its obligations in all material respects with respect to each such FCC License.
No event has occurred which: (i) has resulted in, or after notice or lapse of
time or both would result in, revocation or termination of any FCC License, or
(ii) materially and adversely affects or in the future may (so far as the
Principal Companies can now reasonably foresee) materially adversely affect any
of the rights of any Borrower Affiliated Company thereunder. Except as set forth
on Schedule 4.14, no license or franchise, other than the FCC Licenses described
in Schedule 4.14, is necessary for the operation of the business (including the
Stations) of the Borrower Affiliated Companies as now conducted.
(c) Except as described in Schedule 4.14, no Borrower Affiliated
Company is a party to nor does any Principal Company have knowledge of any
investigation, notice of violation, order or complaint issued by or before any
Governmental Authority, including the FCC, or of any other proceedings (other
than proceedings relating to the communications industry generally) which could
in any manner threaten or adversely affect the validity or continued
effectiveness of the FCC Licenses of any Borrower Affiliated Company. No
Principal Company has reason to believe (other than in connection with there
being no legal assurance thereof) that any of the FCC Licenses described in
Schedule 4.14 will not be renewed in the ordinary course. Each Borrower
Affiliated Company has filed all material reports, applications, documents,
instruments and information required to be filed by it pursuant to applicable
rules and regulations or requests of every regulatory body having jurisdiction
over any of its FCC Licenses or the activities of the Borrower Affiliated
Companies with respect thereto.
Section 4.15. Environmental Compliance.
(a) No Violations. Except as described on Schedule 4.15(a), no Borrower
Affiliated Company or any operator of its Assets is in violation, or alleged
violation, of any Environmental Law.
(b) No Notice of Violations. Except as described on Schedule 4.15(b),
no Borrower Affiliated Company has received notice from any third party,
including without limitation, any Governmental Authority, (i) that any Borrower
Affiliated Company has been identified by the EPA as a potentially responsible
party under CERCLA with respect to a site listed on the National Priorities
List, 40 C.F.R. Part 300 Appendix B (1986); (ii) that any Hazardous Substances
which any Borrower Affiliated Company has generated, transported or disposed of
has been found at any site at which a federal, state or local agency or other
third party has conducted or has ordered that any Borrower Affiliated Company
conduct a remedial investigation, removal or other response action pursuant to
any Environmental Law; or (iii) that it is or shall be a named party to any
claim, action, cause of action, complaint (contingent or otherwise) or legal or
administrative proceeding arising out of any third party's incurrence of costs,
expenses, losses or damages of any kind whatsoever in connection with the
release of any Hazardous Substances.
(c) No Releases of Hazardous Substances. Except as set forth on
Schedule 4.15(c): (i) no Borrower Affiliated Company and no other Person has
used any Assets of any Borrower Affiliated Company for the handling,
manufacturing, processing, storage or disposal of any Hazardous Substances
except in accordance with applicable
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Environmental Laws; and, except as set forth in Schedule 4.15(c), no underground
tank or other underground storage receptacle for Hazardous Substances is located
on such properties; (ii) in the course of any activities conducted by any
Borrower Affiliated Company or any other operators of its properties, (A) no
Hazardous Substances have been generated or are being used on such properties
except in accordance with applicable Environmental Laws and (B) there have been
no Releases (i.e. any past or present releasing, spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping, disposing or
dumping) or threatened releases of any Hazardous Substances on, upon, into or
from the properties of any Borrower Affiliated Company, which releases could
have a material adverse effect on the value of such properties or adjacent
properties or the environment; (iii) there have been no Releases on, upon, from
or into any real property in the vicinity of the real properties of any Borrower
Affiliated Company which, through soil or groundwater contamination, may have
come to be located on, and which would have a material adverse effect on the
value of, the properties of such Borrower Affiliated Company; and (iv) any
Hazardous Substances that have been generated by any Borrower Affiliated Company
on the properties of such Borrower Affiliated Company have been transported
offsite only by carriers having an identification number issued by the EPA (if
such was required at the time) and treated or disposed of only by treatment or
disposal facilities having valid permits as required under applicable
Environmental Laws, which transporters and facilities were at the time of
disposal operating in compliance with such permits and applicable Environmental
Laws.
(d) No Clean Up Requirements. No property of any Borrower Affiliated
Company is or shall be subject to any applicable environmental cleanup
responsibility law or environmental restrictive transfer law or regulation by
virtue of the financing contemplated hereby.
Section 4.16. Employee Benefit Plans.
(a) In General:
(i) Each Employee Benefit Plan of each of the Borrower
Affiliated Companies has been maintained and operated in compliance in
all material respects with the provisions of ERISA and, to the extent
applicable, the Code, including the provisions thereunder respecting
prohibited transactions. Each Borrower Affiliated Company has
heretofore delivered to the Agent the most recently completed annual
report, Form 5500, with all required attachments, and actuarial
statement required to be submitted under 103(d) of ERISA, with respect
to each Guaranteed Pension Plan.
(ii) Set forth on Schedule 4.16, as of the Effective Date, is
a list of each material pension, retirement or similar plan or
obligation of the Borrower Affiliated Companies.
(b) Retiree Welfare Obligations. The Borrower Affiliated Companies are
not obliged to provide health or life benefits to employees beyond their
termination of employment (other than as mandated by law) under any Employee
Benefit Plan which is a welfare plan within the meaning of Section 3(1) of ERISA
to an extent that would
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materially impair their ability to make timely the payments provided for under
this Agreement.
(c) Guaranteed Pension Plans. Each contribution required to be made to
a Guaranteed Pension Plan, whether required to be made to avoid the incurrence
of an accumulated funding deficiency, the notice or lien provisions of 302(f) of
ERISA, or otherwise, has been timely made. No waiver of an accumulated funding
deficiency or extension of amortization periods has been received with respect
to any Guaranteed Pension Plan. No liability to the PBGC (other than required
insurance premiums, all of which have been paid on a timely basis) has been
incurred by any of the Borrower Affiliated Companies or any ERISA Affiliate with
respect to any Guaranteed Pension Plan, and there has not been any ERISA
Reportable Event (other than an event as to which the requirement of 30 days
notice has been waived), or any other event or condition, which presents a
material risk of termination of any Guaranteed Pension Plan by the PBGC. Based
on the latest valuation of each Guaranteed Pension Plan and on the actuarial
methods and assumptions employed for that valuation, the aggregate accrued
benefits of all such Guaranteed Pension Plans did not exceed the aggregate value
of the assets of all such Plans by more than $100,000 Dollars, disregarding for
this purpose the accrued benefits and assets of any Guaranteed Pension Plan with
assets in excess of accrued benefits.
(d) Multiemployer Plans. None of the Borrower Affiliated Companies or
any ERISA Affiliate has incurred any unpaid material liability (including
secondary liability) to any Multiemployer Plan as a result of a complete or
partial withdrawal from such Multiemployer Plan under Section 4201 of ERISA or
as a result of a sale of assets described in Section 4204 of ERISA. None of the
Borrower Affiliated Companies or any ERISA Affiliate has been notified that any
Multiemployer Plan is in reorganization or insolvent under and within the
meaning of Section 4241 or Section 4245 of ERISA or that any Multiemployer Plan
intends to terminate or has been terminated under Section 4041A of ERISA.
Section 4.17. Labor Disputes; Collective Bargaining Agreements;
Employee Grievances. Except as set forth on Schedule 4.17: (a) there are no
collective bargaining agreements or other labor contracts covering any Borrower
Affiliated Company or any Station; (b) no such collective bargaining agreement
or other labor contract will expire prior to the Maturity Date; (c) there is no
pending or threatened Material Labor Dispute against or affecting any Borrower
Affiliated Company or any Station or its representative employees; and (d) each
Borrower Affiliated Company has complied with, is in compliance with and will
continue to comply with the provisions of the Fair Labor Standards Act.
Section 4.18. Insurance. Each Borrower Affiliated Company has obtained
all property and liability insurance with reputable insurance companies
satisfactory to the Agent insuring against such risks and in such amounts as
required by Section 8.5. Set forth on Schedule 4.18 is a true, correct and
complete list, as of the Effective Date, of all insurance of any nature
maintained by each Borrower Affiliated Company (including all material fire,
theft, casualty, general liability, workers compensation, business interruption,
automobile and other insurance policies insuring the Assets or business
operations of each Borrower Affiliated Company), specifying the type of
coverage, the amount of coverage, the premium, the insurer and the expiration
date of each such policy
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(collectively, the "Insurance Policies"). True, correct and complete copies of
all of the Insurance Policies have been made available by the Borrower to the
Agent. All the Insurance Policies are in full force and effect. All premiums (if
any) due on the Insurance Policies or renewals thereof have been paid and there
is no default under any of the Insurance Policies. None of the Borrower
Affiliated Companies have received any notice or other communication from any
issuer of the Insurance Policies canceling or materially amending any of the
Insurance Policies, any deductibles or retained amounts thereunder, or the
annual or other premiums payable thereunder, and no such cancellation or
material amendment is threatened.
Section 4.19. Transactions with Affiliates, Etc. No Borrower Affiliated
Company has any Contractual Obligations to any Affiliate, except under the
Ancillary Documents, the 1992 Stock Option Plan, the Christian Employment
Agreement, and other agreements with employees of such Borrower Affiliated
Company in the ordinary course of business and except for Contractual
Obligations in respect of Investments permitted by Section 9.4(b). Except for
the Christian Note and except for Indebtedness owing to any Borrower Affiliated
Company in respect of loans made to employees of such Borrower Affiliated
Companies permitted by Section 9.4(b), there is no Indebtedness owing by any
Affiliate to any Borrower Affiliated Company.
Section 4.20. Absence of Certain Restrictions. No Borrower Affiliated
Company is bound by any Contractual Obligation which, directly or indirectly,
prohibits or limits, or has the effect of prohibiting or limiting, its
incurrence of Indebtedness, its granting of Liens or its payment of
Distributions.
Section 4.21. Ancillary Documents. The Borrower has furnished or caused
to be furnished to the Agent true and complete copies of each Ancillary
Document. No default by any Borrower Affiliated Company is continuing under any
Ancillary Document. The Principal Companies are not aware of any default by any
other Person under any Ancillary Document to which such Person and any Borrower
Affiliated Company are a party.
Section 4.22. Solvency.
(a) Fair Salable Value of Assets. The fair salable value of the Assets
of the Borrower exceeds the amount that will be required to be paid on or in
respect of the existing debts and other liabilities (including contingent
liabilities) of the Borrower as they mature.
(b) Capital Not Unreasonably Small. The Assets of the Borrower do not
constitute unreasonably small capital for the Borrower to carry out its business
as now conducted and as proposed to be conducted including the capital needs of
the Borrower, taking into account the particular capital requirements of the
business conducted by the Borrower, and the projected capital requirements and
capital availability thereof.
(c) Incurrence of Debts. The Borrower does not intend to and will not
incur debts beyond its ability to pay such debts as they mature taking into
account the timing and amounts of cash to be received by the Borrower and of
amounts to be payable on or in respect of obligations of the Borrower. The cash
flow of the Borrower, after taking
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into account all anticipated uses of the cash of the Borrower, will at all times
be sufficient to pay all such amounts on or in respect of debt of the Borrower
when such amounts are required to be paid.
Section 4.23. Application of Certain Laws and Regulations. No Borrower
Affiliated Company is an "investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended. No Borrower Affiliated Company is 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. No
Borrower Affiliated Company is a Person prohibited from acquiring or holding a
broadcasting license by the Communications Act, including (i) an alien or
representative of an alien, (ii) a corporation organized under the laws of any
foreign government, (iii) any corporation of which any officer or director is an
alien or of which more than one-fifth of the stock is owned of record or voted
by aliens of their representatives or by a foreign government or representative
thereof or by any corporation organized under the laws of a foreign country,
and/or (iv) any corporation directly or indirectly controlled by any other
corporation of which any officer or more than one-fourth of the directors are
aliens or of which more than one-fourth of the stock is owned of record or voted
by aliens, their representatives, or by a foreign government or representative
thereof, or by any corporation organized under the laws of a foreign country and
each Borrower Affiliated Company is in compliance with the Communications Act
with regard to alien control or ownership. No Borrower Affiliated Company is
subject to any Requirement of Law which regulates the incurring of Indebtedness
for Borrowed Money.
Section 4.24. Full Disclosure. To the best knowledge of the Principal
Companies, none of the Transaction Documents, the Loan Documents, the Historical
Financials, or any other agreement, instrument, document, certificate, statement
or letter furnished to the Agent or any Lender by or on behalf of any Principal
Company in connection with any of the transactions contemplated by this
Agreement, contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements contained therein, taken
as a whole together with all Public Filings made by the Principal Companies, not
misleading in light of the circumstances in which they are made. Other than
publicly known matters affecting the communications industry generally and
publicly known matters affecting the local economies of the markets in which the
Principal Companies operate, there is no fact known to the Principal Companies
which has caused or is reasonably likely to cause a Material Adverse Effect,
which fact is not set forth in the Transaction Documents, the Loan Documents,
the Historical Financial Statements, the Public Filings or any other
certificate, opinion or other statement furnished to each Lender.
Section 4.25. Letters of Credit. As of the effectiveness hereof, (i) no
Letters of Credit (as defined in the Existing Credit Agreement) are outstanding,
(ii) all Letter of Credit Disbursements (as defined in the Existing Credit
Agreement) have been repaid and (iii) all Letter of Credit Fees (as defined in
the Existing Credit Agreement) have been paid.
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ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
Section 5.1. Conditions to Initial Credit Extensions. The fulfillment
(to the reasonable satisfaction of the Agent) of the following conditions
precedent shall be required before this Agreement becomes effective and before
the Lenders have any obligation to make the initial Credit Extensions:
(a) Transaction Documents and Loan Documents.
(i) Each of the Transaction Documents shall have been duly and
properly authorized, executed and delivered by the respective party or
parties thereto and each of the Transaction Documents and the Loan
Documents shall be in full force and effect as of the effectiveness of
this Agreement.
(ii) An executed original of each of the Revolving Credit
Notes and the Term Loan A Notes shall have been delivered to the Agent.
Executed originals or (as the case may be) executed counterparts of
each of the other Transaction Documents shall have been delivered to
the Agent. Each of the Transaction Documents (other than this
Agreement) executed and delivered to the Agent shall be substantially
in the form of the appropriate Exhibit hereto.
(b) Corporate Documents. The Agent shall have received:
(i) a copy of the certificate of incorporation of each
Borrower Affiliated Company, certified as of a recent date by the
Secretary of State of the state of incorporation of each Borrower
Affiliated Company;
(ii) a certificate stating that each Borrower Affiliated
Company is a corporation duly organized, validly existing and in good
standing under the laws of its state of incorporation, signed as of a
recent date by the Secretary of State of such state;
(iii) a certificate stating that (A) each Borrower Affiliated
Company is qualified to do business under the laws of each state
wherein the character of the properties owned or held under lease by
any Borrower Affiliated Company or the nature of the Business conducted
by it would require that such Borrower Affiliated Company qualify as a
foreign corporation and (B) such Borrower Affiliated Company is in good
standing under the laws of such state, signed as of a recent date by
the Secretary of State of such state; and
(iv) a certificate of a duly authorized officer of each
Borrower Affiliated Company dated the Effective Date and certifying (A)
that attached thereto is a true and complete copy of the by-laws of
each Borrower Affiliated Company as in effect on the Effective Date,
(B) that the articles of incorporation of each Borrower Affiliated
Company have not been amended since the last amendment referred to in
the certificates delivered pursuant to clause (i) above, (C) that
attached thereto are
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true and correct copies of the records of all corporate action taken by
each Principal Company to authorize its execution and delivery of the
Transaction Documents and its performance of the Loan Documents (and
the borrowings and other transactions contemplated thereby), and that
such corporate actions have not been modified, rescinded or amended and
are in full force and effect on the Effective Date, and (D) as to the
incumbency, the name and a specimen signature of each individual who
shall be authorized: (1) to sign, in the name and on behalf of such
Principal Company, the Transaction Documents to which such Principal
Company is or is to be a party; (2) to give notices and to take other
action on its behalf under this Agreement; and (3) to make (in the case
of the Borrower) applications for Loans and Letters of Credit.
(c) Representations and Warranties. Each of the representations and
warranties made by or on behalf of any of the Principal Companies in any of the
Transaction Documents or the other Loan Documents shall have been true and
correct in all material respects when made, and shall continue to be true and
correct in all material respects as of the effectiveness of this Agreement.
(d) Lien Searches. The Agent shall have received written advice, in
form and substance reasonably satisfactory to the Agent, relating to such Lien
and judgment searches as the Agent may require and the results of such searches
shall be satisfactory to the Agent.
(e) Filings, Registration and Recordings. Any documents (including
UCC-1 financing statements or UCC-3 termination statements) required by the
Agent or the Agent's Special Counsel to be recorded or filed in order to (i)
release any Liens on any Assets of the Principal Companies (other than Liens
permitted by Section 9.2) and (ii) create, in favor of the Collateral Trustee, a
perfected first-priority Lien on Assets of the Principal Companies (other than
those Assets listed on Schedule 4.4(a) or excluded by the express terms of the
Security Documents) with respect to which a Lien may be perfected by filing a
financing statement under the Uniform Commercial Code of the applicable
jurisdiction, or by recording an assignment with the U.S. Patent and Trademark
Office, or by recording a mortgage or deed of trust in the real estate records
of the applicable jurisdiction, shall have been properly recorded or filed in
each office in each jurisdiction required. The Agent shall have received
acknowledgment copies of all such recordings and filings (or in lieu thereof,
the Agent shall have received other evidence satisfactory to it that all such
recordings and filings have been made); and the Agent shall have received
evidence that all necessary recording and filing fees and all taxes or other
expenses related to such filings have been paid in full. Any other action,
including the taking of possession of securities or instruments by the
Collateral Trustee, required in order to create in favor of the Collateral
Trustee, for the ratable benefit of the Agent and the Lenders, a perfected
first-priority Lien on the respective collateral described in any of the
Security Documents to the extent such Liens may be perfected by filing a
financing statement under the Uniform Commercial Code of the applicable
jurisdiction, or by recording an assignment with the U.S. Patent and Trademark
Office, or by recording a mortgage or deed of trust in the real estate records
of the applicable jurisdiction, or by taking possession of the securities or
instruments, shall have been properly taken in order to create such a perfected
first-priority Lien, subject only to Liens permitted by Section 9.2.
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(f) New Mortgage Amendments. The Agent shall have received evidence, in
form and substance satisfactory to it, that each New Mortgage Amendment has been
properly recorded or filed (or arrangements for such recording or filing have
been made on terms satisfactory to the Agent) in each office in each
jurisdiction required in order to amend the Mortgages relating to Material Real
Property to provide the Collateral Trustee with a perfected Lien on all real
estate owned by the Principal Companies described therein.
(g) Title Insurance Policies. New ALTA mortgagee policies or
endorsements to each of the existing ALTA mortgagee policies of title insurance
covering all Material Real Property which is the subject of a Mortgage shall
have been issued to the Collateral Trustee by a title insurance company or title
insurance companies satisfactory to the Agent, with proof of full payment for
all fees and premiums for said endorsements. The form and substance of each such
endorsement shall be satisfactory to the Agent and each such title insurance
policy, as so endorsed, shall contain no Schedule B standard pre-printed
exceptions (other than for taxes not yet deemed payable and matters which would
be disclosed by a current survey of the property) and shall contain no
exceptions to coverage other than for Liens which the Agent reasonably
determines are Permitted Liens.
(h) Insurance. The Agent shall have received evidence, in form and
substance satisfactory to the Agent, that (i) each Principal Company has
obtained the policies of insurance required by the Loan Documents which
insurance shall be in form and substance satisfactory to the Agent, and (ii) the
Agent shall have been named additional insured with respect to all liability
insurance policies to the extent requested by the Agent, and the Collateral
Trustee shall have been named loss payee with respect to all casualty insurance
policies to the extent requested by the Collateral Trustee and (iii) all other
requirements of any Loan Document with respect to insurance shall have been
fulfilled.
(i) Fees. The Borrower shall have paid to the Agent all fees required
to be paid to the Agent on the Effective Date pursuant to the Fee Letter.
(j) Legal Opinions. The Agent shall have received a written legal
opinion, with a counterpart for each Lender, addressed to the Agent and the
Lenders, dated the Effective Date, from (i) Edwards & Angell, general counsel to
the Principal Companies, and such opinion shall be in form and substance
satisfactory to the Agent, and (ii) Smithwick & Belendiuk, P.C., special FCC
counsel to the Principal Companies, and such opinion shall be in form and
substance satisfactory to the Agent.
(k) Payment of Costs and Expenses. The Borrower shall have reimbursed
the Agent for all reasonable out-of-pocket expenses (other than fees and
disbursements of the Agent's Special Counsel) incurred by the Agent through the
Effective Date in connection with structuring and syndicating the Facilities and
preparation, review, negotiation, execution and delivery of the Transaction
Documents and review of the Loan Documents. The Borrower shall have paid all
amounts required to be paid by it through the Effective Date under the letter
agreement (the "Special Counsel Fee Agreement") among the Borrower, the Agent
and the Agent's Special Counsel in respect of fees and disbursements of the
Agent's Special Counsel.
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(l) Delivery of Financial Statements. The Borrower shall have furnished
to each of the Lenders the Historical Financials and the Projections.
(m) Real Estate Appraisals not Required. The Agent shall be satisfied
that no real estate appraisals are required or necessary as to the market value
of any real property of the Principal Companies subject to a Mortgage under 12
U.S.C. 93a and title XI of the Financial Institutions, Reform, Recovery and
Enforcement Act of 1989 and the corresponding regulations under 12 C.F.R. 34.41
et. seq. (1990).
(n) Delivery of Consents. The Agent shall have received copies of all
consents referred to on Schedule 4.2 (except for those which, as stated on
Schedule 4.2, shall not be delivered) including consents of the FCC, if any,
required in connection with the transactions contemplated by the Transaction.
(o) Effective Date Certificate. The Agent shall have received the duly
executed and completed Effective Date Certificate substantially in the form
attached hereto as Exhibit D.
(p) Lender Assignments. Each Existing Lender which (i) is not becoming
a Lender hereunder or (ii) is becoming a Lender hereunder but whose aggregate
principal amount of Existing Loans (before giving effect to any Lender
Assignment Agreements) was greater than its initial principal amount of Initial
Term Loan A (as set forth on Schedule 1 hereto) shall have assigned all or a
portion (as the case may be) of the Obligations of the Principal Companies to
such Existing Lender under the Existing Credit Agreement and the other Loan
Documents (as defined in the Existing Credit Agreement) to the Agent for
reallocation to new Lenders pursuant to the Lender Assignment Agreements and
each such Existing Lender shall have delivered a fully executed copy of its
Lender Assignment Agreement to the Agent and the Borrower shall have
acknowledged and executed the same.
(q) Payment of Amounts Under Existing Credit Agreement. The Borrower
shall have paid all accrued and unpaid interest on the Existing Loans through
the Effective Date, all Fees (as defined in the Existing Credit Agreement)
accrued and unpaid through the Effective Date and all other amounts required to
be paid by the Principal Companies under the Loan Documents (as defined in the
Existing Credit Agreement) through the Effective Date.
Section 5.2. Conditions Precedent to Each Credit Extension. The
obligation of each Lender and the Issuing Bank to make any Credit Extension
(including the initial Credit Extension) is subject to the satisfaction, as of
the date of such Credit Extension, of each of the following conditions
precedent:
(a) Required Notices.
(i) In the case of any requested Loan, the Agent shall have
timely received from the Borrower an application for such Loan in
accordance with Section 2.2 which notice without more shall constitute
certification by the Borrower as to
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the matters set forth in clause (ii) of paragraph (b) below and
paragraphs (c), (d) and (e) below; and
(ii) In the case of any requested Letter of Credit, the Agent
and the Issuing Bank shall have timely received from the Borrower a
request for such Letter of Credit in accordance with Article III
hereof, which notice without more shall constitute certification by the
Borrower as to the matters set forth in paragraphs (b), (c), (d) and
(e) below.
(b) Legality of Transactions. It shall not be unlawful (i) for the
Collateral Trustee, the Agent or the Lenders to perform any of their obligations
under any of the Loan Documents or (ii) for any Principal Company to perform any
of its obligations under any of the Loan Documents.
(c) Representations and Warranties. Each of the representations and
warranties made by the Principal Companies in this Agreement and the other Loan
Documents shall be true and correct in all material respects when made and
shall, for all purposes, be deemed to be repeated on the date of the application
or request for such Credit Extension and on the date of such Credit Extension
and shall be true and correct in all material respects on each of such dates,
except for changes which are not prohibited hereunder or which have been
consented to by the Required Lenders and none of which, either singly or in the
aggregate, have had a Material Adverse Effect.
(d) Performance, Etc. Each Principal Company shall have duly and
properly performed, complied with and observed in all material respects each of
its obligations contained in this Agreement. No Default or Event of Default
shall be continuing or shall result from the requested Credit Extension.
(e) WPOR Acquisition. With respect to the WPOR Term Loan A, the WPOR
Acquisition shall satisfy the requirements necessary to constitute a "Permitted
Acquisition" as defined in Section 1.1.
ARTICLE VI
GUARANTY
Section 6.1. Guaranty of Payment.
(a) Guaranty. The Guarantors hereby absolutely and unconditionally, and
jointly and severally, guaranty (for purposes of this Article VI, the
"Guaranty") to the Agent, the Issuing Bank and each Lender the due and punctual
payment in full of all the Obligations in accordance with their respective
terms, whether such Obligations are outstanding on the date of this Agreement or
arise or are incurred at any time or times thereafter.
(b) Guaranty of Payment. If any Principal Company shall fail to make
any payment of any of its Obligations to the Agent, the Issuing Bank or any
Lender when and as the same shall become due and payable, the Guarantors
absolutely and unconditionally
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promise to make such payment to the Agent, the Issuing Bank or such Lender
forthwith upon demand by the Agent, the Issuing Bank or such Lender.
(c) Unlimited Guaranty. Subject to the provisions of Section 6.7, the
liability of each Guarantor under this Guaranty shall be unlimited.
(d) Guaranty Absolute. This Guaranty and the obligations of the
Guarantors hereunder shall be in addition to and shall not in any way be
prejudiced or affected by any other Collateral now or at any time or times
hereafter held by the Agent, the Collateral Trustee, the Issuing Bank or any
Lender, and every right, remedy, power or privilege given to the Issuing Bank,
the Lenders or the Agent under this Guaranty shall be in addition to and not in
limitation of any and every other right, remedy, power or privilege vested in
the Agent, the Collateral Trustee, the Issuing Bank or any Lender under any
other Collateral. No assurance, security or payment of any of the Obligations
which is avoided under any enactment relating to bankruptcy or liquidation or
insolvency, and no release, settlement or discharge given or made by the Issuing
Bank, any Lender or the Agent on the faith of any such assurance, security or
payment, shall prejudice or affect the rights of the Issuing Bank, the Lenders
and the Agent to recover from the Guarantors to the full extent of this Guaranty
as if such assurance, security, payment, release, settlement or discharge (as
the case may be) had never been given or made.
(e) Covenant by Guarantors. Without prejudice to any of the obligations
of the Guarantors to the Issuing Bank, the Lenders and the Agent under the
foregoing paragraphs of this Section 6.1, which obligations are absolute and
unconditional, but as a separate undertaking on the part of the Guarantors, the
Guarantors hereby absolutely covenant and agree to cause, to the extent it is
able, each Principal Company to perform and comply with all of the promises,
covenants, agreements and conditions to be performed and complied with by such
Principal Company which are contained in any of the Loan Documents, and the
Guarantors hereby further agree to take or to cause to be taken, promptly and
without any expense to the Agent, the Issuing Bank, or the Lenders, all such
measures as may be appropriate and can lawfully be effected by such Guarantors
to prevent the occurrence of any Default or Event of Default and to cure or make
good promptly any Default or Event of Default which may occur at any time or
times.
Section 6.2. Waivers of Notice, Etc. It is the express intention of the
Guarantors, the Issuing Bank, the Lenders and the Agent that the obligations of
the Guarantors to the Issuing Bank, the Lenders and the Agent under this
Guaranty, this Agreement and under any of the other Loan Documents shall not be
to any extent or in any way or manner whatsoever satisfied, discharged, impaired
or otherwise affected, except by the payment of the Obligations to the Agent,
the Issuing Bank and the Lenders, and then only to the extent of such payment.
Without limitation of the generality of the foregoing provisions of this Section
6.2, the obligations of the Guarantors to the Issuing Bank, the Lenders and the
Agent under this Guaranty shall not be to any extent or in any way or manner
whatsoever satisfied, discharged, impaired or otherwise affected by any of the
following, whether or not the Guarantors shall have had any notice thereof:
(a) The dissolution, termination of existence, insolvency, business
failure, appointment of a receiver for all or any part of the property of,
assignment for the benefit
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of creditors by, or the commencement of any proceedings under any bankruptcy or
insolvency laws by or against, any Guarantor, any Principal Company, the Issuing
Bank, the Agent or any Lender;
(b) The absorption, merger or consolidation of, or the effectuation of
any other change whatsoever in the name, membership, constitution or place of
formation of, any Guarantor, any Principal Company, the Agent, the Issuing Bank
or any Lender;
(c) Any extension or postponement of the time for the payment of any of
the Obligations, the acceptance of any partial payment thereon, any and all
other indulgences whatsoever by the Agent, the Issuing Bank or any Lender in
respect of any of the Obligations, the taking, addition, substitution or
release, in whole or in part, at any time or times, of any security for any of
the Obligations or the addition, substitution or release, in whole or in part,
of any person or persons primarily or secondarily liable in respect of any of
the Obligations;
(d) Any action or delay in acting or failure to act on the part of the
Agent, the Issuing Bank or any Lender under any of the Loan Documents or in
respect of any of the Obligations or any of the Collateral or otherwise,
including, without limitation, any failure strictly or diligently to assert any
right or to pursue any remedy against any Guarantor or other persons under any
of the Loan Documents or provided by statute or at law or in equity;
(e) Any modification or amendment of, or any supplement or addition to,
the Obligations, this Agreement, any Note, or any of the other Loan Documents;
(f) Any waiver, consent or other action or acquiescence by the Agent,
the Issuing Bank or any Lender at any time or times in respect of any default by
any Guarantor or other persons in the performance or observance of or compliance
with any term, covenant or condition contained in any of the Loan Documents;
(g) The existence or creation at any time or times on or after the date
of this Agreement of any claim, defense, right of set-off or counterclaim of any
nature whatsoever of any Guarantor against any Principal Company, the Agent, the
Issuing Bank or any Lender, or of any Principal Company against any Guarantor,
the Agent, the Issuing Bank or any Lender; or
(h) This Agreement, the Notes, any of the other Loan Documents or any
provisions of any thereof shall at any time and for any reason whatsoever cease
to be in full force and effect or shall be declared null and void or illegal,
invalid, unenforceable or inadmissible in evidence.
Each of the Guarantors hereby absolutely, unconditionally and
irrevocably assents to and waives notice of any and all events, conditions,
matters and things hereinbefore specified in clauses (a) through (h), inclusive,
of the foregoing sentence of this Section 6.2. Each of the Guarantors hereby
irrevocably waives presentment, demand, notice, protest, notice of protest,
notice of dishonor and all other demands and notices in connection with
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the delivery, acceptance, performance, default or enforcement of this Agreement,
any Note, any of the other Loan Documents, any of the Obligations or any of the
Collateral.
Section 6.3. Election of Remedies. This Guaranty hereby made by the
Guarantors is the guaranty of the full and punctual payment and performance by
each Principal Company of all the Obligations and not of the collectability only
of such Obligations. This Guaranty may be enforced by the Agent, the Issuing
Bank or any Lender from time to time as often as the occasion therefor may
arise, regardless of the adequacy of any other Collateral, and without any
requirement on the part of the Agent, the Issuing Bank or any Lender first to
exercise any rights or remedies against any other persons or to exhaust any
remedies available to the Agent, the Issuing Bank or any Lender against any
other Guarantor or any other persons or to resort to any Collateral in the
possession of the Agent, the Issuing Bank, any Lender or the Collateral Trustee
or under the control of the Agent, the Issuing Bank, any Lender or the
Collateral Trustee or to resort to any other source or means of obtaining
payment or enforcing performance of the Obligations or any of them.
Section 6.4. Expenses. The Guarantors hereby, jointly and severally,
unconditionally agree to pay to the Agent, on demand at any time by the Agent,
any and all reasonable costs and expenses which shall at any time or times be
incurred or sustained by the Agent, the Issuing Bank or any Lender in connection
with the enforcement by the Agent, the Issuing Bank or any Lender of all or any
of the rights, remedies, powers or privileges of the Agent, the Issuing Bank or
such Lender under Article VI of this Agreement (including, without limitation,
the reasonable fees and disbursements of counsel incurred by the Agent, the
Issuing Bank or any Lender in connection therewith).
Section 6.5. Unenforceability of Obligations. It is hereby agreed by
each Guarantor as a separate and independent stipulation that, if any other
Guarantor shall cease to have any obligation to discharge its Obligations or any
of them or if any of the moneys included in the Obligations shall become
irrecoverable from any other Guarantor or if any of the Obligations shall become
invalid or unenforceable, in whole or in part, against any other Guarantors for
any reason whatsoever (legal or otherwise), including, but not limited to, any
of the following reasons: (a) any defect in or insufficiency of the powers of
any other Guarantors or any irregular or improper exercise thereof, or (b) the
operation of any statute of limitations or the operation of any other laws now
or hereafter in effect, or (c) the existence of any legal limitation, disability
or incapacity affecting or otherwise relating to any other Guarantor, then this
Guaranty and the obligations of such Guarantor to the Agent, the Issuing Bank
and the Lenders hereunder shall nevertheless be binding on and enforceable
against such Guarantors as if the Obligations were, at the time of demand by the
Agent, the Issuing Bank or any Lender upon the Guarantors for payment under this
Guaranty, fully valid and enforceable against such other Guarantors and as if
such Guarantors were, at the time of such demand, the principal debtors in
respect of all of the Obligations.
Section 6.6. Subrogation Rights; Subordination of Subrogation Rights.
The rights which any Guarantor shall acquire against any Principal Company as a
consequence of making any payment to the Agent, the Issuing Bank or any Lender
under its Guaranty are, in this Section 6.6, collectively called the
"Subrogation Rights." In the event of any
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proceeding for the distribution, division or application of all or any part of
the assets of any such Principal Company, whether such proceeding be for the
liquidation, dissolution or winding up of such Principal Company, a
receivership, insolvency or bankruptcy proceeding, an assignment for the benefit
of creditors, or a proceeding by or against such Principal Company for relief
under any bankruptcy, reorganization or insolvency law, if all of the
Obligations have not been paid and satisfied in full in cash at the time, the
Agent is hereby irrevocably authorized by such Guarantor at any such proceeding:
(a) To enforce all the Subrogation Rights of such Guarantor, either in
the name of the Agent, the Issuing Bank or the Lenders or in the name of such
Guarantor, by proof of debt, proof of claim, suit or otherwise;
(b) To collect any assets of such Principal Company distributed or
applied by way of dividend or payment on account of such Subrogation Rights, and
to apply the same, or the proceeds of any realization thereof, towards the
payment of Obligations until all Obligations have been paid and satisfied in
full; and
(c) To vote claims arising under or in respect of all such Subrogation
Rights.
So long as any Obligations remain unpaid, no Guarantor shall
take any action of any kind to enforce any of its Subrogation Rights, and no
Guarantor shall receive or accept from any Person or Persons any payments or
other distributions in respect of any of its Subrogation Rights. Should any
payment on account of any Subrogation Rights be received by any Guarantor, such
payment shall be delivered by such Guarantor forthwith to the Agent in the form
received by such Guarantor, except for the addition of any endorsement or
assignment necessary to effect transfer of all rights therein to the Agent, the
Issuing Bank and the Lenders. Until so delivered, each such payment shall be
held by such Guarantor in trust for the ratable benefit of the Agent, the
Issuing Bank and the Lenders and shall not be commingled with any other funds of
any Guarantor.
Section 6.7. Limitation on Obligations. It is the intention and
agreement of each of the Guarantors, the Agent, the Issuing Bank and the Lenders
that the obligations of each Guarantor under the provisions of this Article VI
shall be in, but not in excess of, the maximum amount permitted by applicable
law. Accordingly, notwithstanding anything to the contrary contained in this
Article VI, the obligations of each Guarantor under this Article VI shall be
reduced to that amount which, after giving effect thereto, would not render such
Guarantor insolvent or unable to pay its debts and liabilities as they mature or
leave such Guarantor with unreasonably small capital or otherwise exceed the
maximum amount permitted under any federal or state fraudulent conveyance law
applicable to this Article VI. This Section 6.7 is intended solely to preserve
the rights of the Agent, the Issuing Bank and the Lenders under this Agreement
to the maximum extent permitted by applicable law and no Guarantor nor any other
person shall have any right under this Section 6.7 that it would not otherwise
have under applicable law.
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ARTICLE VII
DELIVERY OF FINANCIAL REPORTS, DOCUMENTS
AND OTHER INFORMATION
The Principal Companies agree with the Agent and each of the Lenders
that, until all Commitments have been terminated, all Letters of Credit have
been fully drawn or have terminated or expired and all Obligations have been
paid in cash in full, the Principal Companies shall deliver to each Lender:
Section 7.1. Annual Financial Statements. Annually, as soon as
available, but in any event within ninety (90) days after the last day of each
of the Borrower's fiscal years, consolidated and consolidating balance sheets of
the Borrower and its Subsidiaries at such last day of such fiscal year, and
consolidated and consolidating statements of operations and cash flow for such
fiscal year, each prepared in accordance with GAAP consistently applied, in
reasonable detail, and, as to the consolidated statements, certified without
qualification by Ernst & Young or another firm of independent certified public
accountants satisfactory to the Agent, or certified, as to the consolidating
statements, by the Chief Financial Officer, as fairly presenting the financial
position and the results of operations of the Borrower and its Subsidiaries as
at and for the year ending on its date and as having been prepared in accordance
with GAAP.
Section 7.2. Quarterly Financial Statements. As soon as available, but
in any event within sixty (60) days after the end of each of the Borrower's
fiscal quarters, a consolidated and consolidating balance sheet of the Borrower
and its Subsidiaries as of the last day of such quarter and consolidated and
consolidating statements of operations and cash flow for such quarter, together
with comparative consolidated and consolidating figures for the immediately
preceding fiscal quarter of the Borrower, all in reasonable detail, each such
statement to be certified in a certificate of the Chief Financial Officer as
accurately representing the financial position and the results of operations of
the Borrower and its Subsidiaries as at its date and for such quarter and for
the portion of the fiscal year then ended and as having been prepared in
accordance with GAAP consistently applied (subject to year-end audit
adjustments).
Section 7.3. Compliance Information. Concurrently with any delivery of
financial statements under Sections 7.1 or 7.2, a certificate, in form and
substance reasonably satisfactory to the Agent, of the Chief Financial Officer
of the Borrower (i) certifying that as of the effective date of the certificate,
no Default or Event of Default is continuing or, if a Default or Event of
Default is continuing, specifying the nature and the extent thereof and any
corrective action taken or proposed to be taken with respect thereto, (ii)
setting forth computations in reasonable detail (A) demonstrating compliance
with the covenants set forth in Article X and Sections 9.1, 9.3 (with respect to
Permitted Sales) and 9.5 and (B) in the case of any certificate delivered with
Financial Statements under Section 7.1, calculating Excess Cash Flow for the
fiscal year then ended (iii) certifying that the representations and warranties
contained in Article IV hereof are true in all material respects and with the
same effect as though such representations and warranties were made on the date
of such certificate, except for changes which are not prohibited hereunder
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or which have been consented to by the Required Lenders and none of which,
either singly or in the aggregate, have had a Material Adverse Effect.
Section 7.4. Accountants' Reports. Promptly upon receipt thereof,
copies of all management letters and other material reports submitted to any
Principal Company by its independent accountants in connection with any annual
or interim audit or review of the books of any Borrower Affiliated Company made
by such accountants.
Section 7.5. Copies of Documents. Promptly upon their becoming
available, copies of any: (i) financial statements, projections, non-routine
reports, notices (other than routine correspondence), requests for waivers and
proxy statements, in each case, delivered by any Borrower Affiliated Company to
any lending institution other than the Lenders; (ii) correspondence or notices
received by any Borrower Affiliated Company from any Governmental Authority
which regulates the operations of the Principal Companies, including the FCC,
relating to an actual or threatened change or development which could be
materially adverse to the Borrower Affiliated Companies or any Station, and all
applications for renewals of any of the FCC Licenses; (iii) registration
statements, prospectuses and any amendments and supplements thereto, and any
regular and periodic reports (including, without limitation, reports on Form
10K, Form 10Q or Form 8K), if any, filed by any Borrower Affiliated Company with
any securities exchange or with the Securities and Exchange Commission or any
Governmental Authority succeeding to any or all of the functions of the said
Commission (collectively, the "Public Filings"); (iv) letters of comment or
correspondence sent to any Borrower Affiliated Company by any such securities
exchange or such Commission in relation to such Borrower Affiliated Company and
its affairs; (v) written reports submitted by any Borrower Affiliated Company or
by its independent accountants in connection with any annual or interim audit of
the books of such Borrower Affiliated Company made by such accountants; (vi) any
appraisals received by such Borrower Affiliated Companies with respect to the
properties or assets of such Borrower Affiliate Company; and (vii) any report,
document, notices or proxy statement sent by any Borrower Affiliated Company to
any of its stockholders.
Section 7.6. Annual Budget. Annually, as soon as available but in any
event within thirty (30) days after the last day of each of the Borrower's
fiscal years, a summary of business plans in the form of consolidated and
consolidating (on a station-by-station and market-by-market basis) financial
operating projections for the Borrower and its Subsidiaries for the upcoming
year, including (a) balance sheets, and (b) statements of operations and cash
flows (indicating projected revenues and expenses), each prepared for the
upcoming fiscal year on a monthly basis (together with reasonable assumptions
and explanations attached thereto), all in form and substance satisfactory to
the Required Lenders.
Section 7.7. Additional Information. Such other information regarding
the business, affairs and condition of the Borrower and its Subsidiaries as the
Agent or the Required Lenders may from time to time reasonably request,
including monthly financial statements.
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ARTICLE VIII
AFFIRMATIVE COVENANTS
The Principal Companies agree with the Agent and each Lender that,
until all Commitments have been terminated, all Letters of Credit have been
fully drawn or have terminated or expired and all Obligations have been paid in
cash in full, each Principal Company shall and shall cause each of its
Subsidiaries to:
Section 8.1. Payment and Performance of Obligations. Pay its
Indebtedness and pay and perform its Contractual Obligations promptly and in
accordance with their respective terms, including all Taxes, assessments and
governmental charges upon its income or profits or in respect of its Assets and
all lawful claims for labor, material and supplies or otherwise which, if
unpaid, might give rise to a Lien upon its Assets, unless and to the extent that
such Indebtedness or Contractual Obligations are being contested in good faith
and by appropriate proceedings and that proper and adequate reserves relating
thereto are established in accordance with GAAP by the appropriate Borrower
Affiliated Companies and then only to the extent that a bond is filed in cases
where the filing of a bond is necessary to avoid the creation of a Lien against
any of its properties. Nothing in this Section 8.1 shall (i) relieve any
Principal Company from its absolute and unconditional obligation to pay and
perform all Obligations of such Principal Company promptly and in accordance
with their respective terms, or (ii) require any Principal Company to pay or
perform any obligations in respect of Subordinated Debt if prohibited by any
subordination provisions applicable thereto.
Section 8.2. Conduct of Business. Do, or cause to be done, all things
reasonably necessary to (i) preserve and keep in full force and effect its
corporate existence and good standing under the laws of its jurisdiction of
incorporation or organization, (ii) obtain, maintain, preserve, renew, extend
and keep in full force and effect all permits, rights, licenses, franchises,
authorizations, patents, Trademarks, Copyrights and privileges necessary for the
proper conduct of its business, including FCC Licenses, (iii) conduct and
operate its business substantially in the manner in which it is presently
conducted and operated, (iv) comply in all material respects with all
Requirements of Law, including the Communications Act, (v) comply with all its
Governing Documents, (vi) maintain its qualification to do business in each
jurisdiction in which the failure to do so would have a Material Adverse Effect,
(vii) maintain and preserve all the remainder of its Assets and property, and
all improvements thereon, in use or useful in the conduct of its business and
keep the same in reasonable repair, working order and condition as the same is
now or may hereafter be put (taking into consideration ordinary wear and tear),
damage from casualty expressly not excepted, and from time to time make, or
cause to be made, all needful and proper repairs, renewals and replacements,
betterments, additions and improvements thereto consistent with industry
practices, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times, such repairs, renewals and
replacements, betterments, additions and improvements to be conducted in
accordance with the terms of Section 8.5 and no Borrower Affiliated Company
shall permit or commit waste on any of its properties, (viii) transact business
in such names as such Borrower Affiliated Company has from time to time used in
conducting its business, and (ix) maintain its executive offices and principal
place of business at the
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locations set forth on Schedule 8.2 hereto, or at such other place in the United
States of America as the Borrower shall designate upon written notice to the
Agent. Notwithstanding anything in this Section 8.1 or elsewhere in the
Agreement to the contrary, the Borrower Affiliated Companies will not cause or
permit any Station to:
(a) enter into any so called "local market agreements" or any other
arrangements with any other Communication System (other than another Station)
whereby the parties agree to function cooperatively in terms of programming,
advertising, sales, management, consulting or similar services, except for (i)
any such agreements or arrangements existing on the date hereof and described in
Schedule 8.2(a) or (ii) any Permitted LMA Transactions; or
(b) enter into any so-called "time brokerage agreements" or any other
agreements or arrangements under which any Station shall (i) sell broadcast time
to any other Communication System (other than another Station) which programs
such broadcast time and sells its own commercial advertising announcements
during such broadcast time or (ii) purchase broadcast time on any other
Communication System (other than another Station) for the purpose of programming
such broadcast time and selling its commercial advertisements during such time,
except for (i) such agreements or arrangements existing on the date hereof and
described on Schedule 8.2(b) hereto or (ii) Permitted LMA Transactions; or
(c) otherwise enter into any oral or written agreement with any other
Person (other than one of the Principal Companies) pursuant to which any
employee or any Assets owned by any Borrower Affiliated Company would be used by
or shared with any other Person (other than one of the Principal Companies).
Section 8.3. Books and Records. Keep proper books of record and account
in a manner reasonably satisfactory to the Agent in which full, true and correct
entries shall be made in accordance with GAAP and maintain adequate accounts and
reserves for all Taxes (including income taxes), all depreciation, depletion,
obsolescence and amortization of its properties, all other contingencies, and
all other proper reserves. Maintain a fiscal year ending December 31 of each
year.
Section 8.4. Inspections and Audits. Permit any officer or employee
designated by the Agent or any Lender to visit and inspect any of its properties
and to examine and audit its books and discuss the affairs, finances and
accounts of any Borrower Affiliated Company with its officers, all at such
reasonable times, upon reasonable notice, in a reasonable manner and as often as
the Agent or the Required Lenders may reasonably request. The Principal
Companies shall pay all reasonable out-of-pocket expenses incurred by any
officers or employees of the Agent or any Lender in connection with any such
visitation, audits and inspection.
Section 8.5. Insurance.
(a) Maintain insurance covering, without limitation, fire, public
liability, property damage, product liability workers' compensation and
insurance on all Assets of each Borrower Affiliated Company, all in amounts
customary for the industry and under
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policies issued by financially sound and reputable insurers satisfactory to the
Agent and, with respect to any such insurance policies covering all or any
portion of the Collateral, with a lender's loss payable clause in favor of the
Collateral Trustee for the benefit of the Lenders, as their interests may
appear, and naming the Agent as additional insured. All such policies of
insurance shall be endorsed or otherwise amended to include a lender's loss
payable endorsement, in form and substance reasonably satisfactory to the
Collateral Trustee, which shall provide that, from and after the date, if any,
on which the insurance carrier receives written notice from the Collateral
Trustee that an Event of Default (a "Default Notice") has occurred, all proceeds
otherwise payable to any Borrower Affiliated Company under such policies shall
be payable directly to the Collateral Trustee. Such endorsement or an
independent instrument furnished to the Collateral Trustee shall provide that
the insurance carriers will give the Collateral Trustee at least 30 days' prior
written notice before any such policy or policies of insurance shall be altered
or canceled and that no act or default of any Borrower Affiliated Company or any
other Person shall affect the right of the Collateral Trustee to recover under
such policy or policies of insurance in case of loss or damage.
(b) Each of the Borrower Affiliated Companies irrevocably makes,
constitutes, and appoints the Collateral Trustee (and all officers, employees,
or agents designated by the Collateral Trustee) as such Borrower Affiliated
Company's true and lawful attorney (and agent-in-fact) effective upon the giving
of a Default Notice and the continuance of an Event of Default for the purpose
of making, settling, and adjusting claims under policies of insurance, endorsing
the name of such Borrower Affiliated Company on any check, draft, instrument or
other item or payment for the proceeds of such policies of insurance and for
making all determinations and decisions with respect thereto. In the event that
any Borrower Affiliated Company at any time or times shall fail to obtain or
maintain any of the policies of insurance required hereby or to pay any premium
in whole or part relating thereto, the Collateral Trustee may, without waiving
or releasing any obligation or liability of such Borrower Affiliated Company
hereunder or any Event of Default, in the Collateral Trustee's sole discretion,
obtain and maintain such policies of insurance and pay such premiums and take
any other actions with respect thereto as the Collateral Trustee deems
advisable. All such sums so disbursed by the Collateral Trustee, including
reasonable attorneys' fees, court costs, expenses and other charges relating
thereto, shall be payable, upon demand, by such Borrower Affiliated Company to
the Collateral Trustee and shall be additional Obligations hereunder.
Section 8.6. Notice of Defaults, Litigation; Etc. Deliver to the Agent
and the Lenders prompt written notice of the following:
(a) Any Default or Event of Default, specifying the nature and extent
thereof and the corrective action proposed to be taken in respect thereto.
(b) The filing or commencement of or written notice of intention to
file or commence any action, suit or proceeding, whether at law or at equity or
by or before any Governmental Authority, by or against or affecting any Borrower
Affiliated Company, that, if determined adversely to such Borrower Affiliated
Company, could result in a Default or an Event of Default described in Section
11.1(i) hereof.
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(c) Any development that has resulted in, or could reasonably be
anticipated to result in, a Material Adverse Effect.
(d) Any termination, amendment, modification or supplement of any
Governing Document of any Borrower Affiliated Company or any Ancillary Document
or any waiver under any Ancillary Document, and deliver to the Agent copies of
any such termination, amendment, modification, supplement, or waiver (to the
extent the same is reflected in any writing).
Section 8.7. ERISA Notices.
(a) Promptly notify the Agent in writing of the occurrence of any ERISA
Reportable Event, if a notice of such ERISA Reportable Event is required under
ERISA to be delivered to the PBGC within thirty (30) days after the occurrence
thereof, together with a description of such ERISA Reportable Event and a
statement of the action the Principal Companies intends to take with respect
thereto, together with a copy of any notice thereof given to the PBGC.
(b) Promptly upon filing the same with the Department of Labor or
Internal Revenue Service, furnish to the Agent a copy of the most recent
actuarial statement required to be submitted under 103(d) of ERISA and Annual
Report, Form 5500, with all required attachments, in respect of each Guaranteed
Pension Plan; and
(c) Promptly upon receipt or dispatch, furnish to the Agent any notice,
report or demand sent or received in respect of a Guaranteed Pension Plan under
302, 4041, 4042, 4043, 4063, 4065, 4066 and 4068 of ERISA, or in respect of a
Multiemployer Plan, under 4041A, 4202, 4219, 4242, or 4245 of ERISA.
Section 8.8. No Termination of Loan Documents, Etc. Take or cause to be
taken, promptly and without expense to the Agent or the Lenders, all such action
as may be required to prevent, and refrain from taking any action that might
cause, the termination, cancellation, amendment, rescission or default of any
provision of any of the Loan Documents other than in accordance with the terms
thereof.
Section 8.9. Environmental Laws.
(a) Comply with, and use its best efforts to insure compliance by all
tenants and subtenants, if any, with, all Environmental Laws and obtain and
comply with and maintain, and use its best efforts to insure that all tenants
and subtenants obtain and comply with and maintain, any and all licenses,
approvals, registrations or permits required by any Environmental Laws, except
to the extent that the failure to do so could not have a Material Adverse
Effect.
(b) Conduct and complete or cause to be conducted and completed all
investigations, studies, sampling and testing, and all remedial, removal and
other actions required under any Environmental Laws and promptly comply with all
lawful orders and directives of all Governmental Authorities respecting
Environmental Laws, except to the extent that the same are being contested in
good faith by appropriate proceedings and the
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pendency of such proceedings could not reasonably be expected to have a Material
Adverse Effect or result in a Lien upon any real property of any of the Borrower
Affiliated Companies.
(c) Promptly notify the Agent in writing if any Borrower Affiliated
Company receives: (i) any notice of any violation or administrative or judicial
complaint or order having been filed or about to be filed against any Borrower
Affiliated Company alleging violations of any Environmental Law, or (ii) any
notice from any Governmental Authority or any other Person alleging that any
Borrower Affiliated Company is or may be subject to any Environmental Liability;
and promptly upon receipt thereof, provide the Agent with a copy of such notice
together with a statement of the action the Principal Companies intend to take
with respect thereto.
Section 8.10. Interest Rate Protection. In the case of the Borrower,
maintain and pay and perform as and when due and payable or required to be
performed Interest Rate Contracts reasonably acceptable to the Agent which fix
the interest cost to the Borrower on a notional principal amount of Indebtedness
equal to not less than fifty percent (50%) of the aggregate principal amount of
the Loans outstanding from time to time until the end of the three year period
commencing on the Effective Date. The Agent hereby acknowledges that the
Interest Rate Contracts to which the Borrower is a party on the date hereof are
acceptable to the Agent.
Section 8.11. Governmental Approvals. Obtain all such approvals or
consents from, and take all such other actions with respect to, any Governmental
Authority as may be required for the execution, delivery and performance of the
Loan Documents and the Ancillary Documents, and duly perform and comply with all
of the terms and conditions of all approvals or consents so obtained.
Section 8.12. Collateral for Loans.
(a) Cause all outstanding shares of the Capital Stock of each
Subsidiary of the Borrower to be pledged to the Collateral Trustee in accordance
with the provisions of the Stock Pledge Agreements and Article IV, at all times
from and after the effectiveness of this Agreement.
(b) From time to time, at its own cost and expense, promptly secure or
cause to be secured the Obligations by creating or causing to be created in
favor of the Collateral Trustee for the benefit of the Lenders perfected
security interests (subject only to Liens permitted by the Security Documents)
with respect to all inventory, receivables, equipment, accounts, Copyrights,
patents, Trademarks, other general intangibles, real property (other than
Immaterial Real Property) and other Assets of the Borrower Affiliated Companies,
now owned, to the extent the Agent or the Required Lenders shall so request. All
such security interests will be created under security agreements, mortgages and
other instruments and documents in form and substance satisfactory to the Agent,
and the Borrower shall deliver to the Collateral Trustee (with copies to the
Agent) all such instruments and documents (including, without limitation, legal
opinions, title insurance policies and lien searches) as the Agent or the
Required Lenders shall reasonably request to evidence the satisfaction of the
obligations created by this Section 8.12. The Borrower
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agrees to provide such evidence as the Agent or the Required Lenders shall
request as to the perfection and priority of such security interests (subject
only to Liens permitted by the Security Documents).
Section 8.13. Dividends. In the case of the Borrower, permit its
Subsidiaries to pay cash dividends or make advances or repay advances, and cause
its Subsidiaries to pay such cash dividends or make such advances or repay such
advances, to the extent required to ensure that the Borrower can pay its
monetary Obligations as the same become due.
Section 8.14. Appraisals. If any Lender determines in good faith that
it is required, by Applicable Law or by the Comptroller of Currency or any other
Government Authority, to obtain appraisals as to the market value of any real
property constituting Collateral, obtain such appraisals, at the sole cost and
expense of the Principal Companies. Such appraisals shall conform in all
respects with the requirements contained in 12 U.S.C. 93a and Title XI of the
Financial Institutions, Reform, Recovery and Enforcement Act of 1989 and the
corresponding regulations under 12 C.F.R. 34.41 et seq (1990) and shall be
consistent with the Comptroller of the Currency's Guidelines for Real Estate
Appraisal Policies and Review Procedures (as such Requirements of Law or such
policies and procedures may be amended, supplemented, restated, or otherwise
modified from time to time).
Section 8.15. Permitted Acquisitions.
(a) In the case of any personal property or fixtures acquired by a
Borrower Affiliated Company after the effectiveness hereof in connection with a
Permitted Acquisition (i) pledge such personal property or fixtures (to the
maximum extent permitted by applicable law) to the Collateral Trustee as
security for the payment in full of all the Obligations, pursuant to
documentation satisfactory to the Agent (but in any event not materially more
restrictive or burdensome than the Security Documents in effect as of the
effectiveness hereof), within ten (10) days of such Borrower Affiliated Company
acquiring such personal property or fixtures and (ii) perform any filings,
recordings or other actions necessary in the reasonable judgment of the Agent to
create in favor of the Collateral Trustee a perfected first-priority security
interest in all such personal property or fixtures subject only to Liens
permitted by Section 9.2 within ten (10) days of such Borrower Affiliated
Company acquiring such personal property or fixtures.
(b) In the case of any Material Real Property acquired by a Borrower
Affiliated Company after the effectiveness hereof in connection with a Permitted
Acquisition, (i) execute and deliver to the Collateral Trustee, within fifteen
(15) days after such Borrower Affiliated Company takes or receives possession of
such Material Real Property, a mortgage granting to the Collateral Trustee a
perfected Lien on such Material Real Property and (ii) deliver to the Collateral
Trustee, within thirty (30) days after such Borrower Affiliated Company takes or
receives possession of such Material Real Property, ALTA mortgage policies of
title insurance covering all such Material Real Property and issued by title
insurance companies satisfactory to the Agent, with proof of payment of all fees
and premiums of such policy; provided, further that the amount, form and
substance of each such mortgage title insurance policy shall be satisfactory to
the Agent and each such title insurance policy shall contain no Schedule B
standard preprinted exceptions
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(other than for taxes not yet due and payable and matters which would be
disclosed by a current survey of the property) and shall contain no exceptions
for coverage other than for Liens which the Agent reasonably determines are
Permitted Liens.
(c) Deliver to the Agent and the Agent's Special Counsel within ten
(10) days after the date of any Permitted Acquisition, true, complete and
correct copies of each instrument of transfer, officer's certificate, legal
opinion and other instrument or agreement executed and delivered by the
applicable seller and/or the applicable Borrower Affiliated Company in
connection with such Permitted Acquisition.
Section 8.16. Further Assurances. Cooperate with the Agent and the
Lenders and take such action and execute such further instruments and documents
as the Agent shall reasonably request to further and more perfectly effect the
purposes of this Agreement and the other Loan Documents.
ARTICLE IX
NEGATIVE COVENANTS
The Principal Companies agree with the Agent and each of the Lenders
that, until all Commitments have been terminated, all Letters of Credit have
been fully drawn or have terminated or expired and all Obligations have been
paid in cash in full, the Principal Companies shall not and not permit any of
their Subsidiaries to:
Section 9.1. Indebtedness. Create, incur, assume or permit to exist any
Indebtedness to any Person, except:
(a) the Obligations;
(b) Taxes, assessments and governmental charges, non-interest bearing
accounts payable and accrued liabilities, in any case not more than 120 days
past due from the original due date thereof (except any such amounts that are
not required to be paid in accordance with Section 8.1 or that are described on
Schedule 4.11), and non-interest bearing deferred liabilities other than
Indebtedness for Borrowed Money (e.g., deferred compensation and deferred
taxes), in each case incurred and continuing in the ordinary course of business;
(c) Indebtedness consisting of purchase money debt and Capitalized
Lease Obligations in a combined aggregate principal amount not exceeding at any
time $3,000,000;
(d) Subordinated Debt;
(e) Indebtedness of any Principal Company to any other Principal
Company;
(f) Indebtedness of the Borrower Affiliated Companies in respect of
endorsements of negotiable instruments for collection in the ordinary course of
business;
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(g) Indebtedness of the Borrower in respect of Guaranties of
Indebtedness of any of the Borrower Subsidiaries;
(h) Indebtedness of Saga Broadcast in respect of Guaranties of
Indebtedness of any of the Borrower Subsidiaries; and
(i) Indebtedness described on Schedule 9.1(i) annexed hereto.
Section 9.2. Liens. Create, incur, assume or permit to exist any Lien
on any of its Assets, now owned or hereafter acquired, except:
(a) Liens created by the Security Documents;
(b) Permitted Liens;
(c) any Lien existing on any Asset prior to the acquisition thereof by
any Borrower Affiliated Company; provided that (i) such Lien is not created in
contemplation of or in connection with such acquisition; (ii) such Lien does not
apply to any other property or Assets of any Borrower Affiliated Company; (iii)
such acquisition is permitted by this Agreement, and (iv) all Indebtedness
secured by such Lien is permitted by this Agreement;
(d) (i) purchase money mortgages or security interests, conditional
sale arrangements and other similar security interests, in real property,
improvements thereto, equipment or motor vehicles acquired (or, in the case of
improvements, constructed) by any Borrower Affiliated Company (hereinafter
referred to individually as a "Purchase Money Security Interest") with proceeds
of Indebtedness permitted by Section 9.1(c) and (ii) interests of lessors under
Capitalized Leases entered into by any Borrower Affiliated Company and permitted
by Section 9.1(c); provided, that with respect to any Purchase Money Security
Interest:
(A) the transaction in which any Purchase Money Security
Interest is proposed to be created shall not be prohibited by this
Agreement;
(B) any Purchase Money Security Interest shall attach only to
the Asset acquired (or constructed) and shall not extend to or cover
any other Asset of any Borrower Affiliated Company; and
(C) the Indebtedness secured by any Purchase Money Security
Interest shall not exceed the lesser of the cost or fair market value
of the Asset acquired (or constructed) and shall not be renewed,
extended or repaid from the proceeds of any borrowing by any Borrower
Affiliated Company.
(e) Liens consisting of deposits made by any Principal Company to
secure performance of its obligations in connection with Permitted Acquisitions;
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(f) Liens on Assets of the Borrower Affiliated Companies existing on
the date hereof and described in Schedule 9.2; provided that such Liens shall
secure only those obligations which they secure on the date hereof; and
(g) Liens on amounts held in a post-closing escrow account securing
indemnity obligations in connection with a Sale of Assets permitted hereunder.
Section 9.3. Mergers, Consolidations, Sales of Assets.
(a) Merge into or consolidate with any other Person, or permit any
other Person to merge into or consolidate with it, or engage in any Sale of any
of its Assets; except that, so long as no Default or Event of Default is
continuing or would exist after giving effect thereto, the following shall be
permitted:
(i) (A) any merger of any wholly-owned Subsidiary of the
Borrower with and into the Borrower or any other wholly-owned
Subsidiary of the Borrower or (B) any sale, transfer or other
disposition by any wholly-owned Subsidiary of the Borrower of any
Assets to the Borrower or any other wholly-owned Subsidiary of the
Borrower; provided, that (1) the Agent is satisfied that none of the
Collateral Trustee's Liens on the Assets of any Borrower Affiliated
Company would become impaired, unperfected or unenforceable in any
respect, and (2) the Agent is satisfied that all appropriate consents
and approvals of any Governmental Authorities (including the FCC) have
been obtained, and copies of all such consents and approvals have been
delivered to the Agent;
(ii) any Permitted Sale; and
(iii) any sale of any Assets by any Principal Company;
provided, that:
(A) the total consideration (taking appropriate
account of any tax benefits associated with any sale in which such
Principal Company obtains tax certificates issued by the FCC) payable
to or receivable by such Principal Company in connection with such sale
(1) is an amount not less than the fair value of the Assets sold and
(2) consists of at least 90% cash which is (x) payable at the closing
of such sale or (y) held in a post-closing escrow account as security
for indemnity obligations;
(B) the aggregate annual Consolidated EBITDA
attributable to all Assets sold by the Principal Companies during any
Reference Period (determined separately for each sale of Assets based
upon Consolidated EBITDA attributable to such Assets for the Reference
Period ending most recently prior to the date of sale) shall not exceed
ten percent (10%) of the Consolidated EBITDA of the Principal Companies
for such Reference Period (determined without regard to any sales of
Assets during such Reference Period); and
(C) the aggregate annual Consolidated EBITDA
attributable to all Assets sold by the Principal Companies during the
period commencing on January 1, 1996 and ending on the last day of any
Reference Period (determined separately
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for each sale of Assets based upon Consolidated EBITDA attributable to
such Assets for the Reference Period ending most recently prior to the
date of sale) shall not exceed twenty-five percent (25%) of the
Consolidated EBITDA of the Principal Companies for such Reference
Period (determined without regard to any sales of Assets during such
Reference Period).
(b) Change the corporate structure or organization of the Borrower
Affiliated Companies from that set forth in Schedule 9.3, provided, however,
that any Principal Company may make a Permitted Acquisition and any Principal
Company may form one or more wholly-owned Subsidiaries so long as:
(i) the Principal Companies shall notify the Agent and the
Collateral Trustee at least ten (10) days prior to the formation or
acquisition of such Subsidiary;
(ii) such new Subsidiary executes and delivers to the Agent
and the Lenders (A) an accession agreement, in form and substance
satisfactory to the Agent, pursuant to which such Subsidiary (1)
becomes a party to this Agreement as a Principal Company and as a
Guarantor, becomes a party to the Borrower Subsidiary Security
Agreement as a Borrower Subsidiary, becomes a party to the Indemnity,
Contribution and Subrogation Agreement as a Borrower Affiliated
Company, and becomes a party to any other Loan Document as the Agent
may reasonably request, and (2) agrees to perform and observe all of
the obligations and covenants (including all obligations and covenants
contained in Article VI hereof) of a Principal Company and a Guarantor
hereunder, of a Borrower Subsidiary under the Borrower Subsidiary
Security Agreement, of a Borrower Affiliated Company under the
Indemnity, Contribution and Subrogation Agreement, and of the
appropriate party under any other Loan Document to which it becomes a
party and (B) a Borrower Subsidiary Trademark Security Agreement, if
applicable;
(iii) all of the outstanding shares of capital stock of such
new Subsidiary shall be pledged to the Collateral Trustee, for the
ratable benefit of the Lenders, pursuant to a stock pledge agreement
substantially in the form of the Borrower Stock Pledge Agreement;
(iv) such new Subsidiary shall otherwise grant a security
interest in all of its Assets of the type described in the Borrower
Subsidiary Security Agreement and the Intellectual Property Security
Agreements to the Collateral Trustee as security for all the
Obligations and shall make all filings, recordings and take such other
actions (including the filing of financing statements and the filing of
security agreements in the United States Patent and Trademark Office)
required by the Agent or the Collateral Trustee in order to create, in
favor of the Collateral Trustee, a perfected first-priority Lien on all
of such Assets of the new Subsidiary (other than Assets of the type
listed on Schedule 4.4(a)) and all of the capital stock of such new
Subsidiary; and
(v) such new Subsidiary shall grant a security interest in and
mortgage on its owned Material Real Property pursuant to a mortgage on
such Assets in form
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and substance satisfactory to the Agent and the Collateral Trustee,
which mortgage shall be filed of record promptly after such new
Subsidiary is formed and ALTA mortgagee policies of title insurance
covering such Material Real Property and issued by title insurance
companies satisfactory to the Agent, with proof of payment of all fees
and premiums of such policy; provided, further that the amount, form
and substance of each such mortgage title insurance policy shall be
satisfactory to the Agent and each such title insurance policy shall
contain no Schedule D preprinted exceptions (other than for taxes not
yet due and payable and matters which would be disclosed by a current
survey of the property) and shall contain no exceptions for coverage
other than for Liens which the Agent reasonably determines are
permitted liens.
Section 9.4. Investments. Make or suffer to exist or to remain
outstanding any Investment, except:
(a) Investments in:
(i) marketable direct obligations of, or obligations the
principal of and interest on which are unconditionally guaranteed by,
the United States (or by any agency thereof to the extent such
obligations are backed by the full faith and credit of the United
States), in each case maturing within 90 days from the date of
acquisition thereof;
(ii) securities commonly known as "commercial paper" issued by
a corporation organized and existing under the laws of the United
States or any state thereof maturing within 90 days from the date of
acquisition thereof and having, at such date of acquisition, the
highest credit rating obtainable from Standard & Poor's Corporation or
from Moody's Investors Service, Inc.;
(iii) certificates of deposit, banker's acceptances and time
deposits maturing within 90 days from the date of acquisition thereof
issued or guaranteed by or placed with, and demand deposit accounts or
money market deposit accounts issued or offered by, any commercial bank
organized under the laws of the United States of America or any state
thereof, but only so long as such commercial bank is a Lender or has a
combined capital and surplus and undivided profits of not less than
$500,000,000, or has a credit rating of "A" or better from Standard &
Poor's Corporation or from Moody's Investors Service, Inc.;
(iv) marketable direct obligations of any state of the United
States or any political subdivision thereof maturing within 90 days
from the date of acquisition thereof and having a credit rating of "A"
or better from Standard & Poor's Corporation or from Moody's Investors
Service, Inc.;
(b) Investments in the form of loans to employees of the Borrower
Affiliated Companies (other than Christian), provided that the outstanding
principal amount of all such loans to any one employee shall at no time exceed
$100,000 and that the aggregate outstanding principal amount of all such loans
shall at no time exceed $300,000, and no
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such loan shall be made if, on the date of the proposed loan, any Default or
Event of Default exists or would exist after giving effect to the making of any
such loan;
(c) Investments of any Principal Company in any other Principal
Company, and Investments of any Principal Company in any newly-formed or
newly-acquired Subsidiary of any Principal Company, provided that all
requirements of Section 9.3(c) in respect of such Subsidiary have been
satisfied;
(d) Permitted Acquisitions;
(e) Investments consisting of loans evidenced by the Christian Note and
interest accrued thereon;
(f) Investments in the form of deposits securing performance of any
Principal Company's obligations in connection with a Permitted Acquisition;
(g) Investments in the form of promissory notes issued to any Principal
Company in a sale of Assets permitted by Section 9.3(a)(iv); and
(h) Investments described in Schedule 9.4 hereto.
Section 9.5. Restricted Payments. Make any Restricted Payments, other
than:
(a) payments of cash dividends, making of advances, and repayment of
advances, in each case by any Subsidiary of the Borrower to the parent of such
Subsidiary;
(b) if no Default or Event of Default is continuing or would exist
after giving effect thereto, the Borrower may prepay Indebtedness for Borrowed
Money permitted by Section 9.1(c) and secured by Liens permitted by Section
9.2(d) and Capitalized Lease Obligations; and
(c) payments by the Borrower to stockholders of the Borrower in an
aggregate amount not to exceed $20,000,000 (from and after the effectiveness
hereof) to repurchase shares of Class A Common Stock of the Borrower; provided
that, (i) no Default or Event of Default shall be continuing on the date of the
proposed payment or would result from such payment, and (ii) prior to such
repurchase, the Borrower shall have demonstrated to the reasonable satisfaction
of the Agent (based on, among other things, operating and financial projections
and pro forma financial statements delivered to the Agent and certified by the
Chief Financial Officer) that, immediately after giving effect to such
repurchase (including the making of any Loans and the incurrence of any
Indebtedness required to finance such repurchase, all covenants (including all
covenants contained in Article X hereof) contained herein (A) would be satisfied
on a pro forma basis through the end of and for the Most Recent Reference
Period, and (B) will be satisfied on a pro forma basis through the period ending
two years after the date of such repurchase; and provided further, that the
Borrower shall immediately retire any shares of its Class A Common Stock so
repurchased.
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Section 9.6. Issuance of Capital Stock. Issue any Capital Stock if (i)
such Capital Stock is not Permitted Capital Stock or (ii) the issuance of such
Capital Stock, or the exercise or conversion thereof, would result in a Change
in Control.
Section 9.7. Sale and Leaseback. Enter into any arrangement, directly
or indirectly, with any Person providing for the leasing by any Borrower
Affiliated Company of real or personal property which has been or is to be sold
or transferred by any Borrower Affiliated Company.
Section 9.8. ERISA Compliance.
(a) Engage in any "prohibited transaction" within the meaning of 406 of
ERISA or 4975 of the Code which is not subject to an exemption under 408 of
ERISA or 4975(d) of the Code and which could result in a material liability for
any Borrower Affiliated Company.
(b) Permit any Guaranteed Pension Plan to incur an "accumulated funding
deficiency", as such term is defined in 302 of ERISA, whether or not such
deficiency is or may be waived.
(c) Fail to contribute to any Guaranteed Pension Plan to an extent
which, or terminate any Guaranteed Pension Plan in a manner which, could result
in the imposition of a lien or encumbrance on the assets of any Principal
Company or any of its Subsidiaries pursuant to 302(f) or 4068 of ERISA.
(d) Permit or take any action which would result in the aggregate
benefit liabilities (with the meaning of 4001 of ERISA) of all Guaranteed
Pension Plans exceeding the value of the aggregate assets of such Plans,
disregarding for this purpose the benefit liabilities and assets of any such
Plan with assets in excess of benefit liabilities, by more than $100,000.
Section 9.9. Amendment or Termination of Documents.
(a) Amend or supplement any Governing Documents of any Borrower
Affiliated Company if the effect of such an amendment or supplementation could
reasonably be expected to impair the rights or interests of the Lenders under
the Loan Documents.
(b) Amend or supplement in any material respect or terminate or cancel
any Ancillary Document (other than any Seller Debt Document) if the effect of
such an amendment or supplementation could reasonably be expected to impair the
rights or interests of the Lenders under the Loan Documents.
(c) Amend, supplement or otherwise modify in any respect any Seller
Debt Document if such amendment or supplementation would (i) add any
representation, covenant or agreement or event of default or make any
representation, covenant or agreement or event of default more restrictive as to
any Borrower Affiliated Company, (ii) alter any applicable subordination
provisions, (iii) require any additional payment or prepayment of any principal,
interest, fee or other amount, (iv) shorten the maturity or
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increase the rate or amount or the frequency of payment of any principal,
interest, fee or other amount, or (v) grant any Lien to any holder of any
obligation under or in respect of any Seller Debt Documents. The Principal
Companies will promptly provide to the Agent a copy of any amendment, supplement
or modification whether or not such amendment, supplement or modification shall
have required the consent of the Required Lenders.
(d) Waive, release, discharge or compromise any material obligations of
any parties other than Borrower Affiliated Companies under any Ancillary
Documents.
Section 9.10. Restrictive Agreements. Become or remain bound by any
Contractual Obligation (other than the Loan Documents) which, directly or
indirectly, prohibits or limits, or has the effect of prohibiting or limiting,
or imposes materially adverse conditions on, (i) the incurrence of Indebtedness,
the granting of Liens or the provision of Guaranties by any Borrower Affiliated
Company, or (ii) the making of Distributions by any Subsidiary of the Borrower.
Section 9.11. Transactions with Affiliates. Except as otherwise
expressly permitted by this Agreement, directly or indirectly (i) make any
Investment in any Affiliate, (ii) sell, lease or otherwise dispose of any Assets
or services to, or purchase, lease or otherwise acquire any Assets or services
from, any Affiliate, or (iii) directly or indirectly engage in any other
transaction with or for the benefit of, or make any payment or distribution to,
any Affiliate; provided, that: (i) any employee (or former employee) of the
Borrower owning any Common Stock may serve as an employee or director of any
Borrower Affiliated Company and receive reasonable compensation for his services
in such capacity, (ii) the Principal Companies may perform all their respective
obligations under the Ancillary Documents in accordance with the terms thereof,
and (iii) so long as no Default or Event of Default is continuing, any Borrower
Affiliated Company may enter into any transaction with an Affiliate providing
for the rendering or receipt of services or the purchase, sale or lease of
assets in the ordinary course of business if the monetary or business
consideration arising therefrom would be substantially as advantageous to such
Borrower Affiliated Company as the monetary or business consideration which
would obtain in a comparable arm's length transaction with a Person not an
Affiliate, and such transaction is accurately reflected on the books of such
Borrower Affiliated Company.
Section 9.12. Limitation on Operation of Saga Real Estate. Permit Saga
Real Estate to conduct or engage in any business or operations of any kind,
except the ownership (but not the operation) and other activities necessarily
related to such ownership, of the transmitter site at 2900 S.E. 22d Street, Des
Moines, Iowa.
ARTICLE X
FINANCIAL COVENANTS
The Principal Companies agree with the Agent and each Lender that,
until all Commitments have been terminated, all Letters of Credit have been
fully drawn or have terminated or expired and all Obligations have been paid in
cash in full, the Principal Companies will not cause or permit:
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Section 10.1. Maximum Total Funded Debt Leverage Ratio. The Total
Funded Debt Leverage Ratio (as defined below) for any Reference Period ending
during any period identified in the table below to be greater than the ratio
specified below opposite such period:
<TABLE>
<CAPTION>
Maximum Total Funded
Period Debt Leverage Ratio
------ -------------------
<S> <C>
Effective Date - 12/30/97 5.00:1
12/31/97 - 12/30/98 4.50:1
12/31/98 - 12/30/99 4.00:1
12/31/99 - Thereafter 3.50:1
</TABLE>
As used in this Section 10.1, "Total Funded Debt Leverage Ratio" means, in
relation to any Reference Period, the ratio of (i) Consolidated Total Funded
Debt at the end of such Reference Period to (ii) Consolidated EBITDA for such
Reference Period.
Section 10.2. Pro Forma Fixed Charges Coverage Ratio. The Pro Forma
Fixed Charges Coverage Ratio (as defined below) for the Reference Period ending
December 31, 1995 and any Reference Period ending thereafter (but excluding
Reference Periods ending after June 30, 2003) to be less than 1.05:1. As used in
this Section 10.2, "Pro Forma Fixed Charges Coverage Ratio" means, in relation
to any Reference Period described in the previous sentence, the ratio of (i)
Consolidated EBITDA for such Reference Period to (ii) Pro Forma Fixed Charges
for the Reference Period commencing on the day following the last day of such
Reference Period.
Section 10.3. Minimum Interest Coverage Ratio. The Interest Coverage
Ratio (as defined below), for any Reference Period ending during any period
identified in the table below to be less than the ratio specified below opposite
such period:
<TABLE>
<CAPTION>
Minimum Interest
Period Coverage Ratio
------ --------------
<S> <C>
Effective Date - 3/30/98 2.00:1
03/31/98 - Thereafter 2.50:1
</TABLE>
As used in this Section 10.3, "Interest Coverage Ratio" means, in relation to
any Reference Period described in the previous sentence, the ratio of (i)
Consolidated Net Operating Cash Flow for such Reference Period to (ii)
Consolidated Total Interest Expense for such Reference Period.
Section 10.4. General Provisions Relating to Financial Terms and
Covenants. In the event the Borrower or any of its Subsidiaries acquires or
disposes of any Communications System or other business, the following
adjustments shall be made:
(a) Consolidated EBITDA and Consolidated Net Operating Cash Flow. In
determining Consolidated EBITDA or Consolidated Net Operating Cash Flow for any
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period, there shall be (i) included in such Consolidated EBITDA or such
Consolidated Net Operating Cash Flow (as the case may be) all EBITDA or Net
Operating Cash Flow (as the case may be) attributable to any Communications
System or other business acquired by the Borrower or any of its Subsidiaries
during such period as if such Communications System or other business were
acquired on the day before the first day of such period and (ii) excluded from
such Consolidated EBITDA or such Consolidated Net Operating Cash Flow (as the
case may be) all EBITDA or Net Operating Cash Flow (as the case may be)
attributable to any Communications System or other business disposed of by the
Borrower or any of its Subsidiaries during such period as if such Communications
System or other business were disposed of on the day before the first day of
such period. For purposes hereof, the EBITDA or Net Operating Cash Flow (as the
case may be) attributable to any such acquired or disposed Communications System
or other business prior to the date of acquisition or disposition thereof shall
be determined in a manner consistent with the method for determining
Consolidated EBITDA or Consolidated Net Operating Cash Flow (as the case may
be), but on a non-consolidated basis (subject to any adjustments made pursuant
to paragraph (c) below).
(b) Consolidated Total Interest Expense. In determining Consolidated
Total Interest Expense for any period, there shall be (i) included all
Consolidated Total Interest Expense attributable to Indebtedness incurred or
assumed by the Borrower or any of its Subsidiaries during such period in
connection with any Permitted Acquisition as if such Indebtedness was incurred
or assumed on the day before the first day of such period and (ii) excluded all
Consolidated Total Interest Expense attributable to that portion of the
principal amount of the Loans prepaid during such period with Net Proceeds
pursuant to Section 2.5(d) as if such portion of the principal amount of the
Loans was prepaid on the day before the first day of such period.
(c) Additional Adjustments. For purposes of this Section 10.4, the
EBITDA and the Net Operating Cash Flow attributable to any Communications System
or other business acquired or disposed of by the Borrower or any of its
Subsidiaries during any period may be adjusted to more accurately reflect the
financial condition and results of operations of the acquired Communications
System or other business after giving effect to the acquisition as mutually
determined and agreed to by the Borrower and the Required Lenders. The Borrower
and the Required Lenders shall each use good faith efforts to mutually determine
and agree to any such adjustments. It is understood and agreed, however, that
the Required Lenders shall have no liability for failing to agree to any such
adjustments. In the case of an Acquisition by the Borrower or any of it
Subsidiaries, such adjustments may reflect any cost savings (but not revenue
enhancements) that would have been achieved if such business had been owned by
the Borrower or one of its Subsidiaries for the entire relevant period including
adjustments for excess owner's compensation, excess rent paid to related
parties, directors' fees paid to related parties and workmen's compensation and
other insurance expense in excess of that which would have been incurred under
policies of the Borrower and its Subsidiaries existing at the time of such
Acquisition.
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ARTICLE XI
EVENTS OF DEFAULT; ACCELERATION
Section 11.1. Events of Default. The occurrence of any one or more of
the following events or conditions shall constitute an "Event of Default":
(a) the Borrower shall fail to make any payment or mandatory prepayment
of principal on any Note or to reimburse the Issuing Bank for any Letter of
Credit Disbursement when and as the same becomes due and payable; or
(b) the Borrower shall fail to pay any interest on any Loan or Letter
of Credit Disbursement or any Fee or any other amount (other than an amount
referred to in paragraph (a) above) when and as the same shall become due and
payable, and such default shall continue unremedied for three (3) Business Days;
or
(c) any Principal Company shall fail to perform or observe any of its
agreements contained in Section 8.15, Articles IX or X hereof; or
(d) any Principal Company shall fail to perform or observe any of its
agreements in any of the Loan Documents (other than those specified in
paragraphs (a), (b) or (c) above) and such failure shall remain unremedied upon
the earlier to occur of thirty (30) days after any executive officer of the
Borrower shall know thereof and thirty (30) days after notice thereof shall have
been given to the Borrower by the Agent; or
(e) (i) any Borrower Affiliated Company shall fail to pay any
principal, interest or other amounts due in respect of any Indebtedness for
Borrowed Money (other than Subordinated Debt) and the aggregate amount not paid
when due, together with other such amounts not paid when due by any Borrower
Affiliated Companies, exceeds $1,000,000; or (ii) Indebtedness for Borrowed
Money (including Subordinated Debt) of any Borrower Affiliated Company is
accelerated or otherwise becomes due and payable prior to its stated maturity
and the aggregate amount accelerated or otherwise due and payable, together with
other such amounts of any Borrower Affiliated Companies accelerated or otherwise
due and payable, exceeds $1,000,000; or (iii) any holder or holders (or any
agent or trustee for any such holder or holders) of Indebtedness for Borrowed
Money of any Borrower Affiliated Company take any legal proceeding against any
Borrower Affiliated Company to collect such Indebtedness or to seek possession
of any portion of the Collateral by any means or to enforce any provision of any
agreement or instrument evidencing or governing such Indebtedness for Borrowed
Money and such Indebtedness, together with other such Indebtedness of any
Borrower Affiliated Companies with respect to which such legal proceedings have
been taken, exceeds $1,000,000; or
(f) any representation or warranty made or deemed made by or on behalf
of any Principal Company in or in connection with any Loan Document or in any
report, certificate, financial statement or other instrument furnished in
connection with or pursuant to any Loan Document shall prove to have been false
or misleading in any material respect when made or deemed made; or
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(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i) relief
in respect of any Borrower Affiliated Company or of a substantial part of the
property or Assets of any Borrower Affiliated Company under Title 11 of the
United States Code, as now constituted or hereafter amended, or any other
Federal, state or foreign bankruptcy, insolvency, receivership or similar law,
(ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for any Borrower Affiliated Company or for a
substantial part of the property or assets of any Borrower Affiliated Company or
(iii) the winding-up or liquidation of any Borrower Affiliated Company; and such
proceeding or petition shall continue undismissed for sixty (60) days or an
order or decree approving or ordering any of the foregoing shall be entered; or
(h) any Borrower Affiliated Company shall (i) voluntarily commence any
proceeding or file any petition seeking relief under Title 11 of the United
States Code, as now constituted or hereafter amended, or any other Federal,
state or foreign bankruptcy, insolvency, receivership or similar law, (ii)
consent to the institution of, or fail to contest in a timely and appropriate
manner, any proceeding or the filing of any petition described in (g) above,
(iii) apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for any Borrower Affiliated
Company or for a substantial part of the property or Assets of any Borrower
Affiliated Company, (iv) file an answer admitting the material allegations of a
petition filed against it in any such proceeding, (v) make a general assignment
for the benefit of creditors, (vi) become unable, admit in writing its inability
or fail generally to pay its debts as they become due or (vii) take any action
for the purpose of effecting any of the foregoing; or
(i) one or more judgments for the payment of money shall be rendered
against any Borrower Affiliated Company which, together with other such
judgments against any Borrower Affiliated Companies, exceed $1,000,000, and the
same shall remain undischarged, unsatisfied or unstayed or a bond sufficient to
cover such judgment shall not have been provided by the Borrower for a period of
30 consecutive days, or any action shall be legally taken by a judgment creditor
to levy upon Assets or properties of any Borrower Affiliated Company to enforce
any such judgment; or
(j) any Borrower Affiliated Company or any ERISA Affiliate incurs any
liability to the PBGC or a Guaranteed Pension Plan pursuant to Title IV of ERISA
in an aggregate amount which, together with other such liabilities of any other
Borrower Affiliated Companies, exceeds $1,000,000; any Borrower Affiliated
Company shall fail to make required contributions, in accordance with applicable
provisions of ERISA, to each of the Plans; any Borrower Affiliated Company or
any ERISA Affiliate is assessed withdrawal liability pursuant to Title IV of
ERISA by a Multiemployer Plan in an aggregate amount which, together with other
such assessed withdrawal liabilities of any Borrower Affiliated Companies,
exceeds $1,000,000; or any of the following occurs with respect to a Guaranteed
Pension Plan: (i) an ERISA Reportable Event, provided the Required Lenders
determine in their reasonable discretion that such event reasonably could be
expected to result in liability of any Borrower Affiliated Company to the PBGC
or the Plan in an aggregate amount, together with other such liabilities of any
Borrower Affiliated Companies, exceeds $1,000,000 and such event or events in
the circumstances occurring reasonably could constitute grounds for the
termination of such Plan by the PBGC or for the appointment by
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the appropriate United States District Court of a trustee to administer such
Plan; (ii) the appointment by a United States District Court of a trustee to
administer such Plan; or (iii) the institution by the PBGC of proceedings to
terminate such Plan; or
(k) any of the Liens granted to the Collateral Trustee for the ratable
benefit of the Agent and the Lenders under the Security Documents on any
substantial and material portion of the Collateral shall fail to be valid,
perfected Liens, subject to no prior or equal Lien, except as permitted by
Section 9.2 or shall become otherwise impaired or unenforceable in any material
respect; or
(l) the loss, revocation or failure to file for renewal of any FCC
License; the commencement of proceedings by the FCC to suspend, revoke,
terminate or substantially and adversely modify any FCC License, which
proceedings are resolved unfavorably to the applicable Borrower Affiliated
Company and which resolution shall be Final; or the designation of an
application for renewal of any such FCC License for an evidentiary hearing upon
issues related to the basic qualifications of the applicable Borrower Affiliated
Company to be an FCC licensee which hearing is resolved unfavorably to such
Borrower Affiliated Company and which resolution shall be Final, which FCC
License is now held or hereafter acquired by such Borrower Affiliated Company
and is necessary for the continued operation of such Borrower Affiliated
Company's business in the same manner as is being conducted at the time of such
loss, revocation, failure to renew, commencement of proceedings or designation
for hearing; or
(m) there shall have occurred a Change in Control; or
(n) any Governmental Authority shall (i) enter a judgment, order or
decree requiring any Borrower Affiliated Company to divest itself of all or any
substantial part of its property or Assets, or (ii) take any action of any kind
whatever for the dissolution of any Borrower Affiliated Company or for the
suspension of any material operations of any Borrower Affiliated Company; or
(o) (i) a judgment creditor of any Principal Company shall obtain
possession of any substantial and material portion of the Collateral by any
means, including, without limitation, levy, distraint, replevin or self-help; or
(ii) any substantial portion of the Collateral shall be taken by eminent domain
or condemnation; or (iii) a material provision of any of the Loan Documents
shall cease for any reason to be in full force and effect other than pursuant to
the terms of the Loan Documents or as a result of a waiver or amendment by the
Lenders or the Required Lenders, as applicable, or any party thereto shall
purport to disavow its material obligations thereunder or shall declare that it
does not have any further obligation thereunder or shall contest the validity or
enforceability thereof.
Section 11.2. Termination of Commitments; Acceleration of Obligations.
If any one or more Events of Default shall at any time occur (other than an
Event of Default described in Sections 11.1(g) or 11.1(h)):
(a) the Agent, at the request of the Required Lenders, shall, by
written notice to the Borrower, take any or all of the following actions, at the
same or different times: (i)
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terminate forthwith all the Commitments or (ii) declare the Loans then
outstanding to be forthwith due and payable in whole or in part, whereupon the
principal of the Loans so declared to be due and payable, together with accrued
interest thereon and any unpaid accrued Fees and all other liabilities of the
Principal Companies accrued hereunder and under any other Loan Document, shall
become forthwith due and payable without presentment, demand, protest or any
other notice of any kind, all of which are hereby expressly waived by the
Principal Companies, anything contained herein or in any other Loan Document to
the contrary notwithstanding; and if any one or more Events of Default described
in Sections 11.1(g) or 11.1(h) above shall at any time occur, the Commitments
shall automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and any unpaid accrued Fees and all other
liabilities of the Principal Companies accrued hereunder and under any other
Loan Document, shall automatically become due and payable, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived by the Principal Companies, anything contained herein or in any
other Loan Document to the contrary notwithstanding.
(b) Subject to the provisions of Article XII hereof, each of the
Lenders, the Agent and the Collateral Trustee may proceed to protect and enforce
all or any of its rights, remedies, powers and privileges under this Agreement,
the Notes or the other Loan Documents by action at law, suit in equity or other
appropriate proceedings, whether for specific performance of any covenant
contained in this Agreement, the Notes or any of the other Loan Documents or in
aid of the exercise of any power granted to the Agent, the Collateral Trustee or
any Lender herein or therein. Neither the Agent, the Lenders nor the Collateral
Trustee shall be required to marshall any present or future Collateral or any
other present or future security for or guaranties of, all or any of the
Obligations or to resort to any such Collateral, securities or guaranties in any
particular order.
Section 11.3. No Implied Waivers; Rights Cumulative. No delay on the
part of the Collateral Trustee, the Agent, the Issuing Bank or any Lender in
exercising any right, remedy, power or privilege under any of the Loan Documents
or provided by statute or at law or in equity or otherwise shall impair,
prejudice or constitute a waiver of any such right, remedy, power or privilege
or be construed as a waiver of any Default or Event of Default or as an
acquiescence therein. No right, remedy, power or privilege conferred on or
reserved to the Collateral Trustee, the Agent, the Issuing Bank or any Lender
under any of the Loan Documents or otherwise is intended to be exclusive of any
other right, remedy, power or privilege. Each and every right, remedy, power and
privilege conferred on or reserved to the Collateral Trustee, the Agent, the
Issuing Bank or any Lender under any of the Loan Documents or otherwise shall be
cumulative and in addition to each and every other right, remedy, power or
privilege so conferred on or reserved to the Collateral Trustee, the Agent, the
Issuing Bank or any Lender and may be exercised at such time or times and in
such order and manner as the Collateral Trustee, the Agent, the Issuing Bank or
any Lender shall (in its sole and complete discretion) deem expedient.
Section 11.4. Letters of Credit. If any one or more Events of Default
shall at any time occur (other than an Event of Default described in Section
11.1(g) or 11.1(h)) the Agent may and, at the request of the Required Lenders,
shall, by written notice to the Borrower, take any or all of the following
actions, at the same or different times:
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(a) declare all obligations of the Borrower under any outstanding
Letter of Credit Disbursement, all the unpaid interest accrued thereon and all
(if any) other sums payable by the Borrower under Article III of this Agreement,
to be immediately due and payable;
(b) send notices to all or any of the beneficiaries of the Letters of
Credit advising such beneficiaries of the intention and desire of the Agent, as
directed by the Required Lenders, to effect the termination, cancellation and
surrender of such Letters of Credit in thirty (30) days, provided, however, that
the Agent shall not send any such notice to any beneficiary unless the Agent has
requested that the Principal Companies deliver cash collateral to the Agent
pursuant to paragraph (c) below and the Principal Companies have failed to
deliver such cash collateral to the Agent within ten (10) days of such request;
and
(c) require that the Borrower deliver to the Agent, on behalf of the
Issuing Bank, cash collateral in an amount equal to the face amount of all
Letters of Credit which remain outstanding; and if any one or more Events of
Default described in Sections 11.1(g) or 11.1(h) shall occur, then (i) all of
the obligations of the Borrower under any outstanding Letter of Credit
Disbursement, together with accrued interest thereon and all (if any) other sums
payable by the Borrower under Article III of this Agreement, shall automatically
become due and payable, without presentment, demand, protest or any other notice
of any kind, all of which are hereby expressly waived by the Principal
Companies, anything contained herein or in any other Loan Document to the
contrary notwithstanding and (ii) the Agent may take any or all of the actions
set forth in clauses (b) and (c) of this Section 11.4.
ARTICLE XII
THE AGENT
Section 12.1. Appointment, Powers and Immunities. Each Lender hereby
irrevocably appoints and authorizes the Agent to act as its agent hereunder and
under the other Loan Documents (excluding the Security Documents) with such
powers as are specifically delegated to the Agent by the terms of this Agreement
and such other Loan Documents together with such other powers as are reasonably
incidental thereto. The Agent shall have no duties or responsibilities except
those expressly set forth in this Agreement and the other Loan Documents and
shall not be a trustee for any Lender. The Agent shall not be responsible to the
Lenders for any recitals, statements, representations or warranties contained in
this Agreement or the other Loan Documents or in any certificate or other
documents referred to or provided for in, or received by any of them under, this
Agreement or the other Loan Documents, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
the other Loan Documents or any other document referred to or provided for
herein or therein or for the collectability of the Loans or for the validity,
effectiveness or value of any interest or security covered by the Security
Documents or for the value of any Collateral or for the validity or
effectiveness of any assignment, mortgage, pledge, security agreement, financing
statement, document or instrument, or for the filing, recording, re-filing,
continuing or re-recording of any thereof or for any failure by the Borrower or
any of the
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other Borrower Affiliated Companies to perform any of its obligations hereunder
or under the other Loan Documents. The Agent may employ agents and
attorneys-in-fact and shall not be answerable, except as to money or securities
received by it or its authorized agents, for the negligence or misconduct of any
such agents or attorneys-in-fact selected by it with reasonable care. Neither
the Agent nor any of its directors, officers, employees or agents shall be
liable or responsible for any action taken or omitted to be taken by it or them
hereunder, or the other Loan Documents or in connection herewith or therewith,
except for its or their own gross negligence or willful misconduct.
Section 12.2. Reliance by Agent. The Agent shall be entitled to rely
upon any certification, notice or other communication (including any thereof by
telephone, telex, telegram or cable) believed by it to be genuine and correct
and to have been signed or sent by or on behalf of the proper person or persons,
and upon advice and statements of legal counsel, independent accountants and
other experts selected by the Agent. As to any matters not expressly provided
for by this Agreement or the other Loan Documents, the Agent shall in all cases
be fully protected in acting, or in refraining from acting hereunder or under
the other Loan Documents in accordance with instructions signed by the Required
Lenders, and such instructions of the Required Lenders and any action taken or
failure to act pursuant thereto shall be binding on all of the Lenders.
Section 12.3. Events of Default. The Agent shall not be deemed to have
knowledge of the occurrence of a Default (other than the non-payment of
principal, interest or fees on Loans) unless the Agent has received notice from
a Lender or the Borrower specifying such Default and stating that such notice is
a "Notice of Default". In the event that the Agent receives such a notice of the
occurrence of a Default, the Agent shall give prompt notice thereof to the
Lenders (and shall give each Lender notice of each such non-payment). The Agent
shall (subject to Section 12.7) take such action with respect to such Default as
shall be directed by either all of the Lenders or the Required Lenders, as
provided in Section 13.4.
Section 12.4. Rights as a Lender. The Agent and its Affiliates may
(without having to account therefor to any Lender) accept deposits from, lend
money to and generally engage in any kind of banking, trust or other business
with the Borrower Affiliated Companies or their Affiliates, as if it were not
acting as the Agent, and the Agent may accept fees and other consideration from
the Principal Companies or their Affiliates, for services in connection with
this Agreement or any of the other Loan Documents or otherwise without having to
account for the same to the Lenders.
Section 12.5. Indemnification. The Lenders shall indemnify the Agent
(to the extent not reimbursed by the Principal Companies under Sections 13.1 and
13.2), ratably in accordance with the aggregate principal amount of the
outstanding Loans made by the Lenders (or, if no Loans are at the time
outstanding, ratably in accordance with their respective Commitments), for any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements or any kind and nature
whatsoever which may be imposed on, incurred by or asserted against the Agent in
any way relating to or arising out of this Agreement or any of the other Loan
Documents or any other documents contemplated by or referred to herein or
therein or the transactions contemplated by or referred to herein or therein or
the transactions contemplated hereby
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and thereby (including, without limitation, the costs and expenses which the
Principal Companies are obligated to pay under Sections 13.1 and 13.2, but
excluding, unless a Default has occurred and is continuing, normal
administrative costs and expenses incident to the performance of its agency
duties hereunder) or the enforcement of any of the terms hereof, or of any such
other documents, provided that no Lender shall be liable for any of the
foregoing to the extent they arise from the gross negligence or willful
misconduct of the party to be indemnified.
Section 12.6. Non-Reliance on Agent and Other Lenders. Each Lender
agrees that it has, independently and without reliance on the Agent or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrower Affiliated Companies
and decision to enter into this Agreement and that it will, independently and
without reliance upon the Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own analysis and decisions in taking or not taking action under this Agreement
or the other Loan Documents. The Agent shall not be required to keep itself
informed as to the performance or observance by the Borrower Affiliated
Companies of this Agreement or the other Loan Documents or any other document
referred to or provided for herein or therein or to inspect the properties or
books of the Borrower Affiliated Companies. Except for notices, reports and
other documents and information expressly required to be furnished to the
Lenders by the Agent hereunder or the other Loan Documents, the Agent shall not
have any duty or responsibility to provide any Lender with any credit or other
information concerning the affairs, financial condition or business of the
Borrower Affiliated Companies, which may come into the possession of the Agent
or any of its Affiliates.
Section 12.7. Failure to Act. Except for action expressly required of
the Agent hereunder, the Agent shall in all cases be fully justified in failing
or refusing to act hereunder or thereunder unless it shall be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
Section 12.8. Resignation or Removal of Agent. Subject to the
appointment and acceptance of a successor Agent as provided below, the Agent may
resign at any time by giving not less than thirty (30) days' prior written
notice thereof to the Lenders and the Principal Companies and the Agent may be
removed at any time with or without cause by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Agent. If no successor Agent shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Agent's giving of notice of resignation or the Required Lenders'
removal of the retiring Agent, then the retiring Agent may, on behalf of the
Lenders, after consultation with the Principal Companies, appoint a successor
Agent which shall be one of the Lenders. Upon the acceptance of any appointment
as Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Agent, and the retiring Agent shall be discharged from its
duties and obligations hereunder. After any retiring Agent's resignation or
removal hereunder as Agent, the provisions of this Article XII shall continue
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in effect for its benefit in respect of any actions taken or omitted to be taken
by it while it was acting as the Agent.
Section 12.9. Sharing of Collateral and Payments.
(a) Prior to any acceleration of the Obligations:
(i) in the event that any Lender shall obtain payment in
respect of a Note or a Letter of Credit Disbursement, or interest
thereon, whether voluntarily or involuntarily, and whether through the
exercise of a right of banker's lien, set-off or counterclaim against
any Borrower Affiliated Company or otherwise, in a greater proportion
than any such payment obtained by any other Lender in respect of the
corresponding Note held by it or the share of any Letter of Credit
Disbursement owed to it, then the Lender so receiving such greater
proportionate payment shall (A) purchase for cash from the other Lender
or Lenders such portion or each such other Lender's or Lenders' Loan or
(B) reimburse for cash to the Lender or Lenders such portion of each
such Lender's or Lenders' share of the Letter of Credit Disbursement,
as shall be necessary to cause such Lender receiving the proportionate
overpayment to share the excess payment with each Lender; and
(ii) in the event that any Lender shall obtain payment in
respect of any Interest Rate Contract to which such Lender is a party,
whether voluntarily or involuntarily, and whether through the exercise
of a right of banker's lien, set-off or counterclaim against any
Borrower Affiliated Company or otherwise, such Lender shall be
permitted to retain the full amount of such payment and shall not be
required to share such payment with any other Lender.
(b) Upon or following any acceleration of the Obligations, in the event
that any Lender shall obtain payment in respect of a Note or Letter of Credit
Disbursement, or interest thereon, or in respect of an Interest Rate Contract to
which such Lender is a party, or receive any Collateral or proceeds thereof with
respect to any Note, Letter of Credit Disbursement or any Interest Rate Contract
to which it is a party, whether voluntarily or involuntarily, and whether from
the Agent or the Collateral Trustee or through the exercise of a right or
banker's lien, set-off or counterclaim against any of the Borrower Affiliated
Companies, in a greater proportion than any such payment obtained by any other
Lender in respect of the aggregate amount of the corresponding Note held by such
Lender, the share of any Letter of Credit Disbursement owed to it and any
Interest Rate Contract to which such Lender is a party, then the Lender so
receiving such greater proportionate payment or such greater proportionate
amount of Collateral, shall purchase for cash from the other Lender or Lenders
such portion or each such other Lender's or Lenders' Loan, or shall reimburse
for cash to each Lender or Lenders such portion of each such Lender's or
Lenders' share of the Letter of Credit Disbursement, or shall provide the other
Lenders with the benefits of any such Collateral as shall be necessary to cause
such Lender receiving the proportionate overpayment to share the excess payment
or benefits of such Collateral ratably with each Lender. For the purposes of
this subsection 12.9(b), payments in respect of Notes or Letter of Credit
Disbursements received by each Lender and receipt of Collateral by each Lender
shall be in the same proportion as the proportion of: (A) the sum of: (x) the
Obligations owing to such Lender in respect of the Note held by
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such Lender, plus (y) the Obligations owing to such Lender in respect of
Interest Rate Contracts to which such Lender is party, if any, plus (z) the
Obligations owing to such Lender in respect of its share of any Letter of Credit
Disbursement, if any, to (B) the sum of: (x) the Obligations owing to all of the
Lenders in respect of all of the Notes, plus (y) the Obligations owing to all of
the Lenders in respect of all Interest Rate Contracts to which any Lender is a
party, plus (z) the Obligations owing to all of the Lenders in respect of all
Letters of Credit Disbursements outstanding; provided, however, that, with
respect to subsections 12.9(a)(i) and (b) above, if all or any portion of such
excess payment or benefits is thereafter recovered from the Lender which
received the proportionate overpayment, such purchase of Loans, reimbursement of
Letter of Credit Disbursements or payment of benefits, as the case may be, shall
be rescinded, and the purchase price, reimbursements and benefits returned, to
the extent of such recovery, but without interest.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 13.1. Fees and Expenses; Indemnity. The Principal Companies
will promptly pay all reasonable costs of the Agent (except for fees of the
Agent's Special Counsel incurred by Agent through the Effective Date) in
structuring and syndicating the Facilities and in preparing, reviewing,
negotiating, executing and delivering the Loan Documents and all reasonable
costs and expenses of the issue of the Notes and all reasonable costs and
expenses in reviewing the Ancillary Documents and of the Borrower's and the
other Borrower Affiliated Companies' performance of and compliance with all
agreements and conditions contained herein on its part to be performed or
complied with (including, without limitation, all costs of filing or recording
any assignments, mortgages, financing statements and other documents), and the
reasonable fees and expenses and disbursements of counsel to the Agent in
connection with the administration, interpretation and enforcement of this
Agreement, the other Loan Documents and all other agreements, instruments and
documents relating to this transaction, the consummation of the transactions
contemplated by all such documents, the preservation of all rights of the
Lenders and the Agent, the negotiation, preparation, execution and delivery of
any amendment, modification or supplement of or to, or any consent or waiver
under, any such document (or any such instrument which is proposed but not
executed and delivered) and with any claim or action threatened, made or brought
against any of the Lenders or the Agent arising out of or relating to any extent
to this Agreement, the other Loan Documents or the transactions contemplated
hereby or thereby. Subject to the Special Counsel Fee Agreement, the Borrower
shall promptly pay all reasonable fees and disbursements of the Agent's Special
Counsel incurred by the Agent through the Effective Date in connection with the
preparation, execution and delivery of the Loan Documents, the review of the
Ancillary Documents and the consummation of the transactions contemplated by all
such documents. In addition, the Principal Companies will promptly pay all
reasonable costs and expenses (including, without limitation, reasonable fees
and disbursements of counsel) suffered or incurred by the Agent, each Lender and
the Collateral Trustee in connection with its enforcement of the payment of the
Notes held by it or any other sum due to it under this Agreement or any of the
other Loan Documents or any of its other rights hereunder or thereunder. In
addition to the foregoing, the Principal Companies shall
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indemnify each Lender and the Agent and each of their respective directors,
officers, employees, attorneys and agents against, and hold each of them
harmless from, any loss, liabilities, damages, claims, costs and expenses
(including reasonable attorneys' fees and disbursements) suffered or incurred by
any of them arising out of, resulting from or in any manner connected with, the
execution, delivery and performance of each of the Loan Documents, the Loans,
the Letters of Credit and any and all transactions related to or consummated in
connection with the Loans or the Letters of Credit. The indemnity set forth in
the immediately preceding sentence shall include any losses, liabilities,
damages, claims, costs and expenses suffered or incurred by any Lender or the
Agent or any of their respective directors, officers, employees, attorneys or
agents arising out of or related to any Environmental Matter, Environmental
Liability or Environmental Proceeding, or in investigating, preparing for,
defending against, or providing evidence, producing documents or taking any
other action in respect of any commenced or threatened litigation,
administrative proceeding or investigation under any federal securities law or
any other statute of any jurisdiction, or any regulation, or at common law or
otherwise, which is alleged to arise out of or is based upon: (i) any untrue
statement or alleged untrue statement of any material fact of any Borrower
Affiliated Company and any of its affiliates in any document or schedule filed
with the Securities and Exchange Commission or any other governmental body; (ii)
any omission or alleged omission to state any material fact required to be
stated in such document or schedule, or necessary to make the statements made
therein, in light of the circumstances under which made, not misleading; (iii)
any acts, practices or omission or alleged acts, practices or omissions of any
Borrower Affiliated Company or any of its agents related to the making of any
acquisition, purchase of shares or assets pursuant thereto, financing of such
purchases or the consummation of any other transactions contemplated by any such
acquisitions which are alleged to be in violation of any federal securities law
or of any other statute, regulation or other law of any jurisdiction applicable
to the making of any such acquisition, the purchase of shares or assets pursuant
thereto, the financing of such purchases or the consummation of the other
transactions contemplated by any such acquisition; or (iv) any withdrawals,
termination or cancellation of any such proposed acquisition for any reason
whatsoever. The indemnity set forth herein shall be in addition to any other
obligations or liabilities of the Principal Companies to the Agent and the
Lenders hereunder or at common law or otherwise. The provisions of this Section
13.1 shall survive the payment of the Notes and the termination of this
Agreement.
Section 13.2. Taxes. If, under any law in effect on the date of the
closing of any Loan hereunder, or under any retroactive provision of any law
subsequently enacted, it shall be determined that any Federal, state or local
tax (other than taxes based on the net income of the Lenders or the Agent) is
payable in respect of the issuance of any Note, or in connection with the filing
or recording of any assignments, mortgages, financing statements, or other
documents (whether measured by the amount of Indebtedness secured or otherwise)
as contemplated by this Agreement, then the Principal Companies will pay any
such tax and all interest and penalties, if any, and will indemnify the Lenders
and the Agent against and save each of them harmless from any loss or damage
resulting from or arising out of the nonpayment or delay in payment of any such
tax. If any such tax or taxes shall be assessed or levied against any Lender or
any other holder of a Note, such Lender, or such other holder, as the case may
be, may notify the Principal Companies and make immediate payment thereof,
together with interest or penalties in connection
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therewith, and shall thereupon be entitled to and shall receive immediate
reimbursement therefor from the Principal Companies. Notwithstanding any other
provision contained in this Agreement, the covenants and agreements of the
Principal Companies in this Section 13.2 shall survive payment of the Notes and
the termination of this Agreement.
Section 13.3. Survival of Agreements and Representations; Construction.
All agreements, representations and warranties made herein shall survive the
delivery of this Agreement and the Notes. The headings used in this Agreement
and the table of contents are for convenience only and shall not be deemed to
constitute a part hereof. All uses herein of the masculine gender or of singular
or plural terms shall be deemed to include uses of the feminine or neuter
gender, or plural or singular terms, as the context may require.
Section 13.4. Modifications, Consents and Waivers; Entire Agreement. No
modification or amendment of any provision of this Agreement, any Notes, the
Security Documents, or any of the other Loan Documents shall be effective unless
it shall be in writing and signed by the Principal Companies party to the
relevant Loan Document. No modification, amendment or waiver of or with respect
to any provision of this Agreement, any Notes, the Security Documents, or any of
the other Loan Documents nor consent to any departure by any Principal Company
from any of the terms or conditions thereof, shall in any event be effective
unless it shall be in writing and signed or consented to in writing by the
Required Lenders. Notwithstanding the foregoing, any modification or amendment
of, or waiver or consent with respect to (a) any reduction in the principal of,
or contract rate of interest on (other than the reduction of the Default Rate to
the rate that would otherwise be applicable), any Note; (b) any postponement of
the date fixed for any payment of principal (other than Excess Cash Flow
Payments and Net Proceeds Payments) of or interest on any Note or for any
payment of Fees scheduled to be made hereunder for the accounts of the Lenders;
(c) any reduction in the amount of any payment of principal (other than Excess
Cash Flow Payments and Net Proceeds Payments) or interest on any Note or of any
payment of Fees scheduled to be made hereunder for the accounts of the Lenders;
(d) any increase in the Commitments; (e) any change in the definition of
"Required Lenders", "Conversion Date", or "Maturity Date", or any change in the
Percentage of any Lender except pursuant to an Assignment in accordance with the
terms hereof; (f) any release of Collateral (unless either: (i) such release is
in connection with the Sale of such Collateral and either such Sale is permitted
by this Agreement or substantially all of the Net Proceeds from such Sale are
used to pay the Obligations or pledged to the Agent as Cash Collateral or (ii)
such release is not in connection with such Sale of such Collateral and the fair
market value of the Collateral to be released when added to the aggregate fair
market value of all Collateral previously released by the Collateral Trustee
other than in connection with a Sale of such Collateral is less than
$2,000,000); (g) any release of any Guarantor (unless such release is in
connection with the Sale of all of the capital stock of such Guarantor and
either such Sale is permitted by this Agreement or substantially all of the Net
Proceeds from such Sale are used to pay the Obligations or pledged to the Agent
as Cash Collateral); (h) any assignment or delegation of the rights and
obligations of the Principal Companies under this Agreement; and (i) this
Section 13.4, shall be in writing and signed or consented to in writing by the
Agent and all of the Lenders. Any such waiver or consent shall be
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effective only in the specific instance and for the purpose for which given. No
consent to or demand on any of the Principal Companies in any case shall, of
itself, entitle it to any other or further notice or demand in similar or other
circumstances. This Agreement, the other Loan Documents, the Special Counsel Fee
Agreement and the Fee Letter embody the entire agreement and understanding among
the Lenders, the Agent and the Principal Companies and supersede all prior
agreements and understandings relating to the subject matter hereof.
Notwithstanding the foregoing, Schedules 4.1, 4.12, 4.14, 8.2 and 9.3 to the
Credit Agreement, Schedule III to the Collateral Trust Agreement, Schedules 3.01
(a)(ii), 3.01(a)(iii), 3.01(b)(iii), 3.01(b)(iv), 3.01(c) and 3.04(a) to the
Borrower Security Agreement, Schedules 3.01(a)(ii), 3.01(a)(iii), 3.01(b)(iii),
3.01(b)(iv), 3.01(c) and 3.04(a) to the Borrower Subsidiary Security Agreement
and Schedule I to the Borrower Stock Pledge Agreement may be supplemented or
amended and restated by the Borrower in connection with any Permitted
Acquisition, to the extent that such supplement or amendment and restatement
reflects changes that are permitted by the Credit Agreement and the other Loan
Documents. Such supplement or amendment and restatement shall become effective
upon the Borrower's delivery of the same to the Agent, together with a
certificate of an authorized officer of the Borrower that such supplement or
amendment and restatement reflects changes that are permitted by the Credit
Agreement and the other Loan Documents. The Agent shall promptly distribute to
each Lender a copy of any such supplement or amendment and restatement, together
with the certificate of the authorized officer of the Borrower referred to
above.
Section 13.5. Remedies Cumulative. Each and every right granted to the
Agent, the Issuing Bank and the Lenders hereunder or under any other document
delivered hereunder or in connection herewith, or allowed it by law or equity,
shall be cumulative and may be exercised from time to time. No failure on the
part of the Agent, the Issuing Bank or any Lender or the holder of any Note to
exercise, and no delay in exercising, any right shall operate as a waiver
thereof, nor shall any single or partial exercise of any right preclude any
other or future exercise thereof or the exercise of any other right. The due
payment and performance of the Obligations shall be without regard to any
counterclaim, right of offset and any other claim whatsoever which any of the
Principal Companies may have against any Lender, the Issuing Bank or the Agent
and without regard to any other obligation of any nature whatsoever which any
Lender, the Issuing Bank or the Agent may have against any Principal Company,
and no such counterclaim or offset shall be asserted by any Principal Company in
any action, suit or proceeding instituted by any Lender, the Issuing Bank or the
Agent for payment or performance of the Obligations.
Section 13.6. Further Assurances. At any time and from time to time,
upon the request of the Agent, the Principal Companies shall execute, deliver
and acknowledge or cause to be executed, delivered and acknowledged, such
further documents and instruments and do such other acts and things as the Agent
may reasonably request in order to fully effect the purposes of this Agreement,
the other Loan Documents and any other agreements, instruments and documents
delivered pursuant hereto or in connection with the Loans, including, without
limitation, the execution and delivery to the Agent of Mortgages in form and
substance satisfactory to the Agent covering all Material Real Property or
interests therein acquired by the Borrower, and all leases of Material Real
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Property entered into by the Borrower as tenant or lessee, after the date of
this Agreement, as provided in Subsection 8.15(b).
Section 13.7. Notices. All notices, requests, reports and other
communications pursuant to this Agreement shall be in writing, either by letter
(delivered by hand or commercial messenger service or sent by certified mail,
return receipt requested, except for routine reports delivered in compliance
with Article 5 hereof which may be sent by ordinary first-class mail) or
telegram or telecopy, addressed as follows:
(a) If to the Principal Companies:
c/o Saga Communications, Inc.
73 Kercheval Avenue
Grosse Pointe Farms, Michigan 48236
Attention: Mr. Edward K. Christian
Telecopier No.: (313) 886-7150
with a copy to:
Mr. Norman L. McKee at the address set
forth above; and
a copy to:
Edwards & Angell
101 Federal Street
Boston, Massachusetts 02110
Attention: Stephen O. Meredith, Esq.
Telecopier No.: (617) 439-4170
(b) If to any Lender:
To its address set forth below its name on the
signature pages hereof, with a copy to the Agent; and
(c) If to the Agent:
The First National Bank of Boston
100 Federal Street
Media & Communications (01-21-05)
Boston, Massachusetts 02110
Attention: Mr. Mark S. Denomme
Telecopier No.: (617) 434-3401
with a copy (other than in the case of Borrowing
Notices and Reports and other documents delivered in
compliance with Article 5 hereof) to:
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Bingham, Dana & Gould
150 Federal Street
Boston, Massachusetts 02110
Attention: Frederick F. Eisenbiegler, Esq.
Telecopier No.: (617) 951-8736
Any notice, request or communication hereunder shall be deemed to have been
given on the day on which it is telecopied to such party at the telecopier
number specified above or delivered by hand or such commercial messenger service
to such party at its address specified above, or, if sent by mail, on the third
Business Day after the day deposited in the mail, postage prepaid, or in the
case of telegraphic notice, when delivered to the telegraph company, addressed
as aforesaid. Any party may change the person, address or telecopier number to
whom or which notices are to be given hereunder, by notice duly given hereunder;
provided, however, that any such notice shall be deemed to have been given
hereunder only when actually received by the party to which it is addressed.
Section 13.8. Counterparts. This Agreement may be signed in any number
of counterparts with the same effect as if the signatures thereto and hereto
were upon the same instrument.
Section 13.9. Severability. The provisions of this Agreement are
severable, and if any clause or provision hereof shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction and shall not in any manner affect such clause or provision in
any other jurisdiction, or any other clause or provision in this Agreement in
any jurisdiction. Each of the covenants, agreements and conditions contained in
this Agreement is independent, and compliance by the Principal Companies with
any of them shall not excuse noncompliance by the Principal Companies with any
other. All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any such covenants, the fact
that it would be permitted by an exception to, or be otherwise within the
limitations of, another covenant shall not avoid the occurrence of a Default or
an Event of Default if such action is taken or condition exists.
Section 13.10. Binding Effect; No Assignment or Delegation by Borrower.
This Agreement shall be binding upon and inure to the benefit of the Principal
Companies and their successors and to the benefit of the Lenders and the Agent
and their respective successors and assigns. The rights and obligations of the
Principal Companies under this Agreement shall not be assigned or delegated
without the prior written consent of the Agent and the Lenders, and any
purported assignment or delegation without such consent shall be void.
Section 13.11. Assignments and Participations by Lenders.
(a) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time sell to one or more banks or other
entities ("Participants") participating interests in any Loan owing to such
Lender, any Note held by such Lender, any Commitment of such Lender, or any
other interest of such Lender hereunder and
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under the other Loan Documents; provided, however, that the sum of such selling
Lender's (i) Available Revolving Credit Commitment, if any, (ii) Revolving
Credit Outstandings, if any, and (iii) outstanding Term Loans being sold shall
in no event be less than $5,000,000 and shall be an integral multiple of
$1,000,000 in excess thereof. In the event of any such sale by a Lender of
participating interests to a Participant, such Lender's obligations under this
Agreement to the other parties to this Agreement shall remain unchanged, such
Lender shall remain solely responsible for the performance thereof, such Lender
shall remain the holder of any such Note for all purposes under this Agreement
and the other Loan Documents, the Borrower and the Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents and such Lender
shall retain the sole right to enforce the Obligations of the Principal
Companies to such Lender and to approve any amendment, modification or waiver of
any provision of this Agreement. It is understood that nothing in the prior
sentence or elsewhere in this Section 13.11 shall prohibit a Lender from
agreeing with any Participant that such Lender will not take any action which
would require approval of all of the Lenders under Section 13.4 without the
consent of such Participant and each Lender hereby agrees that it will not agree
with any Participant that it will not take any action without such Participant's
consent except such actions as would require approval of all Lenders under
Section 13.4. The Borrower agrees that if amounts outstanding under this
Agreement or the Notes are due or unpaid, or shall have been declared or shall
have become due and payable upon the occurrence of an Event of Default, each
Participant shall be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement or any Note to the
same extent as if the amount of its participating interest were owing directly
to it as a Lender under this Agreement or any Note, provided that such
Participant shall only be entitled to such right of setoff if it shall have
agreed in the agreement pursuant to which it shall have acquired its
participating interest to purchase at par from the other Lenders participations
in the Credit Extensions held by the other Lenders in such amounts, and make
such other adjustments from time to time as shall be equitable, to the end that
all the Lenders shall share the benefit of such payment pro rata in accordance
with the unpaid principal and interest on the Credit Extensions held by each of
them as provided in Section 2.18. The Borrower also agrees that each Participant
shall be entitled to the benefits of Sections 2.20, 2.24, and 13.2 with respect
to its participation in the Commitments and the Credit Extensions outstanding
from time to time and all amounts to which any Participant is entitled
thereunder shall be paid by the Borrower directly to the Lender; provided, that
no Participant shall be entitled to receive any greater amount pursuant to such
Sections than the transferor Lender would have been entitled to receive in
respect of the amount of the participation transferred by such transferor Lender
to such Participant had no such transfer occurred.
(b) Any Lender (any such Lender being referred to herein as an
"Assigning Lender") may, in the ordinary course of its business and in
accordance with applicable law, at any time sell to any other Lender or any
Affiliate of such Assigning Lender and, with the consent of the Borrower (except
during the continuance of an Event of Default) and the Agent (neither of which
consents shall be unreasonably withheld), to one or more additional banks or
other financial institutions (a "Purchasing Lender") all or any part of its
rights and obligations under this Agreement and the Notes. Any such assignment
(an "Assignment") shall be made pursuant to an Assignment and Acceptance
Agreement,
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substantially in the form of Exhibit E attached hereto (an "Assignment and
Acceptance Agreement"), executed by such Purchasing Lender, such Assigning
Lender (and, in the case of a Purchasing Lender that is not then a Lender or an
Affiliate of the Assigning Lender, by the Borrower and the Agent) and delivered
to the Agent for its acceptance and recording in the Register; provided,
however, that (i) the sum of such Assigning Lender's (A) Available Revolving
Credit Commitment, if any, (B) Revolving Credit Outstandings, if any, and (C)
outstanding Term Loans being assigned pursuant to such Assignment (determined as
of the date of the Assignment with respect to such Assignment) shall in no event
be less than $5,000,000 and shall be an integral multiple of $1,000,000 (or, if
less, the entire remaining amount of the Assigning Lender's Commitments and
Credit Extensions), (ii) each such Assignment shall be of a constant, and not a
varying, percentage of all of the Assigning Lender's rights and obligations
under this Agreement, and (iii) any Assignment by any Assigning Lender of all or
any part of its Commitments or Credit Extensions shall be made ratably among
such Lender's Revolving Credit Commitment, Term Loan A Commitment, Term Loan B
Commitment, Revolving Credit Outstandings and outstanding Term Loans, in
accordance with the respective amounts of such Commitments and Credit
Extensions, immediately prior to such Assignment. From and after the effective
date specified in each Assignment and Acceptance Agreement, which effective date
must be at least five (5) Business Days after the execution and delivery of such
Assignment and Acceptance Agreement to the Agent and (if required) the
acceptance of such Assignment and Acceptance Agreement by the Borrower and the
Agent (the "Transfer Effective Date"): (x) the Purchasing Lender thereunder
shall be a party hereto and, to the extent provided in such Assignment and
Acceptance Agreement, have the rights and obligations of a Lender hereunder with
respect to the Commitments and Credit Extensions as set forth therein, and (y)
the Assigning Lender thereunder shall, to the extent provided in such Assignment
and Acceptance Agreement, be released from its obligations under this Agreement
to the extent that such obligations have been assumed by the Purchasing Lender
(and, in the case of an Assignment and Acceptance Agreement covering all or the
remaining portion of an Assigning Lender's Commitments and Credit Extensions,
such Assigning Lender shall cease to be a party hereto). Each Assignment and
Acceptance Agreement duly executed and delivered in accordance with the
foregoing provisions of this paragraph (b) shall be deemed to amend this
Agreement to the extent, and only to the extent, necessary to reflect the
addition of such Purchasing Lender as a Lender hereunder and the resulting
adjustment of Percentages and amounts of affected Commitments arising from the
purchase by such Purchasing Lender of all or a portion of the rights and
obligations of such Assigning Lender under this Agreement and the Notes. Within
five (5) Business Days after the Transfer Effective Date determined pursuant to
such Assignment and Acceptance Agreement and this paragraph (b), the Borrower,
at its own expense, shall execute and deliver to the Agent in exchange for the
surrender of the Note or Notes of the Assigning Lender to the Agent a new Note
or Notes to the order of such Purchasing Lender in an amount equal to the
Revolving Credit Commitment or outstanding Term Loans B, as the case may be, and
the outstanding Term Loans A assumed by the Purchasing Lender pursuant to such
Assignment and Acceptance Agreement and, if the Assigning Lender has retained a
Revolving Credit Commitment or outstanding Term Loans B, as the case may be, or
outstanding Term Loans A hereunder, a new Note or Notes to the order of the
Assigning Lender in an amount equal to the Revolving Credit Commitment or
outstanding Term Loans B, as the case may be, and outstanding Term Loans A
retained by it hereunder. Such new Notes shall be dated the Transfer Effective
Date (or such other date
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as may be agreed to by the Borrower, the Agent, the Assigning Lender and the
Purchasing Lender) and shall otherwise be in the form of the Notes replaced
thereby. The Notes surrendered by the Assigning Lender shall be returned by the
Agent to the Borrower marked "canceled."
(c) The Agent shall maintain at its address a copy of each Assignment
and Acceptance Agreement delivered to it and a register (the "Register") for the
recordation of the names and addresses of the Lenders and the Commitments of,
and principal amount of the Loans owing to, each Lender from time to time. The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Borrower, the Agent and the Lenders may treat each Person whose name is
recorded in the Register as the owner of the Commitments and Loans recorded
therein for all purposes of this Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any reasonable time and from time to
time upon reasonable prior notice.
(d) Upon its receipt of an Assignment and Acceptance Agreement executed
by an Assigning Lender and Purchasing Lender (and, in the case of a Purchasing
Lender that is not then a Lender or an Affiliate of the Assigning Lender, by the
Borrower and the Agent) together with payment by the Purchasing Lender to the
Agent for the account of the Agent of a registration and processing fee of
$2,500, the Agent shall (i) promptly accept such Assignment and Acceptance
Agreement, (ii) on the Transfer Effective Date determined pursuant thereto and
paragraph (b) of this Section 13.11, record the information contained therein in
the Register and (iii) give notice of such acceptance and recordation to each of
the Lenders and the Borrower.
(e) By executing and delivering an Assignment and Acceptance Agreement,
the Assigning Lender thereunder and the Purchasing Lender thereunder confirm to
and agree with each other and the other parties hereto as follows: (i) other
than as provided in such Assignment and Acceptance Agreement, such Assigning
Lender makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this Agreement or any of the other Loan Documents or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement, any of the other Loan Documents or any other instrument or
document furnished pursuant hereto or thereto; (ii) such Assigning Lender makes
no representation or warranty and assumes no responsibility with respect to the
financial condition of any of the Principal Companies or the performance or
observance by any of the Principal Companies of any of their obligations under
this Agreement, any of the other Loan Documents or any other instrument or
document furnished pursuant hereto or thereto; (iii) such Purchasing Lender
confirms that it has received a copy of this Agreement, together with copies of
such financial statements and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
such Assignment and Acceptance Agreement; (iv) such Purchasing Lender will,
independently and without reliance upon the Agent, such Assigning Lender or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (v) such Purchasing Lender appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement or any of the other Loan Documents as are
delegated to the Agent by the terms hereof, together
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with such powers as are reasonably incidental thereto; (vi) such Purchasing
Lender agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement or any of the other Loan
Documents are required to be performed by it as a Lender; and (vii) such
Purchasing Lender (A) consents in all respects to the provisions of the
Collateral Trust Agreement, (B) agrees to be bound by the terms of the
Collateral Trust Agreement and (C) authorizes the Collateral Trustee as
Collateral Trustee to act on its behalf under the Collateral Trust Agreement and
to exercise such powers under the Collateral Trust Agreement as are delegated to
the Collateral Trustee by the terms thereof, together with such powers as are
reasonably incidental thereto.
(f) The Principal Companies authorize each Lender to disclose to any
Participant or Purchasing Lender (each, a "Transferee") and any prospective
Transferee any and all information in such Lender's possession concerning the
Principal Companies which has been delivered to such Lender by or on behalf of
the Principal Companies or the Agent pursuant to this Agreement or the other
Loan Documents or which has been delivered to such Lender by or on behalf of the
Principal Companies or the Agent in connection with such Lender's credit
evaluation of the Principal Companies and its Affiliates prior to becoming a
party to this Agreement; provided, that, prior to any such disclosure, the
Transferee or prospective Transferee shall agree to be bound by the provisions
of Section 13.14.
(g) If any interest in this Agreement or any Note is transferred to any
Transferee which is organized under the laws of any jurisdiction other than the
United States or any state thereof, the Assigning Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, (i) to
represent to the Assigning Lender (for the benefit of the Assigning Lender, the
Agent and the Borrower) that under applicable law and treaties no taxes will be
required to be withheld by the Agent, the Borrower or the Assigning Lender with
respect to any payments to be made to such Transferee in respect of the Credit
Extensions, (ii) to furnish to the Assigning Lender (and, in the case of any
Purchasing Lender registered in the Register, the Agent and the Borrower) either
U.S. Internal Revenue Service Form 4224 or U.S. Internal Revenue Service Form
1001 or U.S. Internal Revenue Service Form W-8 (wherein such Transferee claims
entitlement to complete exemption from U.S. federal withholding tax on all
interest payments hereunder) and (iii) to agree (for the benefit of the
Assigning Lender, the Agent and the Borrower) to provide the Assigning Lender
(and, in the case of any Purchasing Lender registered in the Register, the Agent
and the Borrower) a new Form 4224 or Form 1001 upon the expiration or
obsolescence of any previously delivered form and comparable statements in
accordance with applicable U.S. laws and regulations and amendments duly
executed and completed by such Transferee, and to comply from time to time with
all applicable U.S. laws and regulations with regard to such withholding tax
exemption.
(h) Nothing herein shall prohibit any Lender from pledging or assigning
any Note to any Federal Reserve Bank in accordance with applicable law.
(i) Notwithstanding anything in this Section 13.11 or elsewhere in this
Agreement to the contrary, no Principal Company shall be obligated to reimburse
any Lender, any Purchasing Lender, any Participant or the Agent for any costs or
expenses
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incurred by any of them in connection with any Lender's sale of any
participating interest or any Assignment hereunder.
Section 13.12. FCC Approval. Notwithstanding anything to the contrary
contained in this Agreement or in the other Loan Documents, neither the Agent
nor any of the Lenders will take any action pursuant to this Agreement or any of
the other Loan Documents, which would constitute or result in a change in
control of, or assignment of any FCC License of, any Borrower Affiliated Company
requiring the prior approval of the FCC without first obtaining such prior
approval of the FCC. After the occurrence of an Event of Default, each Principal
Company shall take or cause to be taken any action which the Agent or the
Collateral Trustee may reasonably request in order to obtain from the FCC such
approval as may be necessary to enable the Agent or the Collateral Trustee to
exercise and enjoy the full rights and benefits granted by this Agreement or any
of the other Loan Documents, including, at the Principal Companies' cost and
expense, the use of the Principal Companies' best efforts to assist in obtaining
such approval for any action or transaction contemplated by this Agreement or
any of the other Loan Documents for which such approval is required by law,
including specifically, without limitation, upon request, to prepare, sign and
file with the FCC the assignor's or transferor's portion of any application or
applications for the consent to the assignment or transfer of control necessary
or appropriate under the FCC's rules and approval of any of the transactions
contemplated by this Agreement or any of the other Loan Documents.
Section 13.13. Usury Provision. It is not the intention of any parties
to this Agreement to make an agreement in violation of the laws of any
applicable jurisdiction relating to usury. Regardless of any provision of this
Agreement, the Lenders shall never be entitled to receive, collect or apply, as
interest on the Loans, any amount in excess of the maximum amount permitted by
applicable law. If the Lenders ever receive, collect or apply, as interest, any
such excess, such amount which would be excessive interest shall be deemed a
partial repayment of principal and treated hereunder as such; and if principal
is paid in full, any remaining excess shall be paid to the Borrower. In
determining whether or not the interest paid or payable under any specific
contingency exceeds the maximum amount permitted by applicable law, the Lenders
shall, to the extent permitted under applicable laws, and solely for purposes of
making such determination, (i) characterize any non-principal payment as an
expense, fee or premium rather than as interest, (ii) exclude voluntary
prepayments and the effect thereof, and (iii) amortize, prorate, allocate and
spread in equal parts the total amount of interest throughout the entire
contemplated term of this Agreement so that the interest rate is uniform
throughout the entire term of this Agreement; provided, however, that if the
Loans are paid and performed in full prior to the end of the full contemplated
term thereof, and if the interest received for the actual period of existence
thereof exceeds the maximum amount permitted by applicable law, the Lenders
shall refund to the Borrower the amount of such excess or credit the amount of
such excess against the total principal amount of the Loans owing, and, in such
event, the Lenders shall not be subject to any penalties provided by any laws
for contracting for, charging or receiving interest in excess of the maximum
amount permitted by applicable law. This Section 13.13 shall control every other
provision of all agreements pertaining to the transactions contemplated by or
contained in this Agreement.
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Section 13.14. Certain Lien Releases. Upon the occurrence of any
Permitted Sale or any other sale of Assets by any Principal Company permitted by
Section 9.3(a)(iii), the Collateral Trustee's Liens on the Assets sold shall be
automatically released. Notwithstanding the foregoing, the Collateral Trustee's
Liens on the proceeds of any Assets sold shall continue in full force and
effect. The Lenders hereby authorize the Collateral Trustee to execute and
deliver such documents and to take such actions as may be appropriate to give
effect to the foregoing.
Section 13.15. Confidentiality. The Agent and each Lender shall hold
all (i) projections and financial statements which have not been delivered to
the public, and (ii) all other non-public information which the Agent or such
Lender has been informed is non-public or the Agent or such Lender believes is
confidential and has been obtained pursuant to this Agreement, in accordance
with the Agent's or such Lender's customary procedures for handling confidential
information of such nature and in accordance with safe and sound banking
practices, provided that in any event it is understood and agreed that the Agent
and each Lender may make disclosure to its examiners, affiliates, outside
auditors, counsel, and other professional advisors in connection with this
Agreement or any other Loan Documents or as reasonably required by any bona fide
prospective Transferee or actual Transferee in connection with the contemplated
transfer of any Commitment, Loan, Letter of Credit or Note or any participation
therein (provided that such Transferee agrees to keep such information
confidential) or as required or requested by any Governmental Authority or
representative thereof or pursuant to legal process; provided, further, that in
no event shall any Lender be obligated or required to return any materials
furnished by the Borrower.
Section 13.16. Governing Law; Consent to Jurisdiction; Waiver of Trial
by Jury.
(a) THIS AGREEMENT, THE OTHER LOAN DOCUMENTS AND ALL OTHER DOCUMENTS
AND INSTRUMENTS EXECUTED AND DELIVERED IN CONNECTION HEREWITH AND THEREWITH,
SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS
OF THE COMMONWEALTH OF MASSACHUSETTS (WITHOUT REFERENCE TO CONFLICTS OR CHOICE
OF LAW).
(b) THE PRINCIPAL COMPANIES IRREVOCABLY CONSENT THAT ANY LEGAL ACTION
OR PROCEEDING AGAINST ANY OF THEM UNDER, ARISING OUT OF OR IN ANY MANNER
RELATING TO THIS AGREEMENT, AND EACH OTHER LOAN DOCUMENT MAY BE BROUGHT IN ANY
COURT OF THE COMMONWEALTH OF MASSACHUSETTS OR IN THE UNITED SATES DISTRICT COURT
FOR MASSACHUSETTS. THE PRINCIPAL COMPANIES, BY THE EXECUTION AND DELIVERY OF
THIS AGREEMENT, EXPRESSLY AND IRREVOCABLY ASSENT AND SUBMIT TO THE PERSONAL
JURISDICTION OF ANY OF SUCH COURTS IN ANY SUCH ACTION OR PROCEEDING. THE
PRINCIPAL COMPANIES FURTHER IRREVOCABLY CONSENT TO THE SERVICE OF ANY COMPLAINT,
SUMMONS, NOTICE OR OTHER PROCESS RELATING TO ANY SUCH ACTION OR PROCEEDING BY
DELIVERY THEREOF TO IT BY HAND OR BY MAIL IN THE MANNER PROVIDED FOR IN SECTION
13.7. THE PRINCIPAL COMPANIES HEREBY EXPRESSLY AND IRREVOCABLY WAIVE ANY CLAIM
OR DEFENSE IN ANY SUCH ACTION OR PROCEEDING BASED ON ANY ALLEGED LACK OF
PERSONAL JURISDICTION,
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IMPROPER VENUE OR FORUM NON CONVENIENS OR ANY SIMILAR BASIS. THE PRINCIPAL
COMPANIES SHALL NOT BE ENTITLED IN ANY SUCH ACTION OR PROCEEDING TO ASSERT ANY
DEFENSE GIVEN OR ALLOWED UNDER THE LAWS OF ANY STATE OTHER THAN THE COMMONWEALTH
OF MASSACHUSETTS UNLESS SUCH DEFENSE IS ALSO GIVEN OR ALLOWED BY THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS. NOTHING IN THIS SECTION 13.15 SHALL AFFECT OR
IMPAIR IN ANY MANNER OR TO ANY EXTENT THE RIGHT OF ANY LENDER TO COMMENCE LEGAL
PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE PRINCIPAL COMPANIES IN ANY
JURISDICTION OR TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.
(c) EACH OF THE PRINCIPAL COMPANIES WAIVES TRIAL BY JURY IN ANY
LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF,
THIS AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS, OR ANY INSTRUMENT OR DOCUMENT
DELIVERED PURSUANT TO THIS AGREEMENT, OR THE VALIDITY, PROTECTION,
INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF.
Section 13.17. Integration of Schedules and Exhibits. Annexed to this
Agreement are the Schedules and Exhibits. Such Schedules and Exhibits are an
integral part of this Agreement and are hereby incorporated by reference.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed on the date first above written.
PRINCIPAL COMPANIES:
SAGA COMMUNICATIONS, INC.
SAGA BROADCASTING CORP.
FRANKLIN COMMUNICATIONS, INC.
LAKEFRONT COMMUNICATIONS, INC.
SAGA COMMUNICATIONS OF
ILLINOIS, INC.
SAGA COMMUNICATIONS OF IOWA, INC.
SAGA COMMUNICATIONS OF IOWA REAL
ESTATE, INC.
TIDEWATER COMMUNICATIONS, INC.
SAGA COMMUNICATIONS OF NEW ENGLAND,
INC.
SAGA QUAD STATES COMMUNICATIONS, INC.
/s/ Norman L. McKee
By:________________________________________
Norman L. McKee, Chief Financial Officer
<PAGE> 118
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LENDERS:
THE FIRST NATIONAL BANK OF BOSTON
/s/ Mark S. Denomme
By:_____________________________________
Mark S. Denomme, Vice President
Lending Office for all Loans:
The First National Bank of Boston
100 Federal Street
Boston, MA 02110
Address for Notices:
The First National Bank of Boston
100 Federal Street
Media & Communications (01-21-05)
Boston, Massachusetts 02110
Attention: Mr. Mark S. Denomme
Telecopier: (617) 434-3401
THE BANK OF NEW YORK
/s/ Jerome Kapelus
By:_____________________________________
Title:
Lending Office for all Loans:
The Bank of New York
One Wall Street
New York, New York 10286
Address for Notices:
The Bank of New York
One Wall Street
New York, New York 10286
Attention: Mr. Jerome Kapelus
Telecopier: (212) 635-8593
<PAGE> 119
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MELLON BANK, N.A.
/s/ Michael Hrycenko
By:_____________________________________
Title:
Lending Office for all Loans:
Mellon Bank, N.A.
One Mellon Center
Pittsburgh, PA 15258-0001
Address for Notices:
Mellon Bank, N.A.
One Mellon Center, Room 4440
Pittsburgh, PA 15258-0001
Attention: Mr. Michael Hrycenko
Telecopier: (412) 234-6375
UNION BANK OF CALIFORNIA, N.A.
/s/ John Lee
By:_____________________________________
Title:
Lending Office for all Loans:
Union Bank of California, N.A.
400 California Street
San Francisco, CA 94104
Address for Notices:
Union Bank of California, N.A.
400 California Street
San Francisco, CA 94104
Attention: Mr. John Lee
Telecopier: (415) 765-3146
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FLEET BANK, N.A.
/s/ Adam Bester
By:_____________________________________
Title:
Lending Office for all Loans:
Fleet Bank, N.A.
175 Water Street
New York, New York 10038
Address for Notices:
Fleet Bank, N.A.
175 Water Street, 28th Floor
New York, New York 10038
Attention: Mr. Adam Bester
Telecopier: (212) 602-2663
AGENT:
THE FIRST NATIONAL BANK OF BOSTON
/s/ Mark S. Denomme
By:_____________________________________
Title:
Address for Notices:
The First National Bank of Boston
100 Federal Street
Boston, Massachusetts 02110
Attention: Mr. Mark S. Denomme
Media & Communications (01-21-05)
Telecopier: (617) 434-3401
<PAGE> 121
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CO-AGENT
THE BANK OF NEW YORK
/s/ Jerome Kapelus
By:_______________________________
Title:
Address for Notices:
The Bank of New York
One Wall Street
New York, New York 10286
Attention: Mr. Jerome Kapelus
Telecopier: (212) 635-8595
For purposes of Section 13.14 only:
COLLATERAL TRUSTEE:
THE FIRST NATIONAL BANK
OF BOSTON
/s/ Mark S. Denomme
By:_______________________________
Mark S. Denomme, Vice President
<PAGE> 1
EXHIBIT 99
SAGA [LOGO]
- ------------------------------
COMMUNICATIONS, INC.
- ------------------------------
73 KERCHEVAL AVENUE
GROSSE POINTE FARMS, MI 48236
(313) 886-7070
FAX (313) 886-7150
SAGA CLOSES ON ACQUISITIONS OF FOUR RADIO STATIONS AND
A $110 MILLION CREDIT FACILITY
CONTACT:
Norm McKee
(313)-886-7070
Grosse Pointe Farms, MI - June 24, 1996 -- Saga Communications, Inc. (AMEX-SGA)
today announced that it had closed on its acquisition of radio stations WNAX
AM/FM in Yankton, South Dakota for approximately $7 million and WPOR AM/FM in
Portland, Maine for approximately $10 million.
In addition to the closing of these acquisitions, the Company signed a new $110
million credit facility. The credit facility was provided by a bank group led by
The First National Bank of Boston as agent and The Bank of New York as co-agent,
and includes Fleet Bank, N.A.; Mellon Bank, N.A.; and Union Bank of California,
N.A.. Approximately $44 million was used to pay off existing debt, and the
balance of the facility, approximately $66 million, is available to finance
future acquisitions.
Saga Communications, Inc. is a broadcasting company which, upon closing a
pending acquisition of four radio stations serving the Springfield, Illinois
market, will own and operate 32 radio stations and a television station, serving
11 markets throughout the midwest, New England, and along the eastern seaboard.
