-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Pdel/BzAx3MBCBYYFAcGlgR2INCVvR24RmVPXnsyxMgmLdvofLq3G/QNHU8tVd9C /WFFtd5VONu1aIYfk52O+A== 0000950134-97-005373.txt : 19970718 0000950134-97-005373.hdr.sgml : 19970718 ACCESSION NUMBER: 0000950134-97-005373 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19970702 ITEM INFORMATION: Acquisition or disposition of assets ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970717 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHANCELLOR BROADCASTING CO /DE/ CENTRAL INDEX KEY: 0001002909 STANDARD INDUSTRIAL CLASSIFICATION: RADIO BROADCASTING STATIONS [4832] IRS NUMBER: 752538487 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27726 FILM NUMBER: 97642021 BUSINESS ADDRESS: STREET 1: 12655 N CENTRAL EXPRESSWAY STREET 2: SUITE 405 CITY: DALLAS STATE: TX ZIP: 75243 BUSINESS PHONE: 9722396220 MAIL ADDRESS: STREET 1: 12655 N CENTRAL EXPRESSWAY STE 405 CITY: DALLAS STATE: TX ZIP: 75243 FORMER COMPANY: FORMER CONFORMED NAME: CHANCELLOR CORP/DE DATE OF NAME CHANGE: 19951031 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHANCELLOR RADIO BROADCASTING CO CENTRAL INDEX KEY: 0000925744 STANDARD INDUSTRIAL CLASSIFICATION: RADIO BROADCASTING STATIONS [4832] IRS NUMBER: 752544623 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 033-80534 FILM NUMBER: 97642022 BUSINESS ADDRESS: STREET 1: 12655 N CENTRAL EXPRESSWY STREET 2: STE 405 CITY: DALLAS STATE: TX ZIP: 75243 BUSINESS PHONE: 2142396220 MAIL ADDRESS: STREET 2: 12655 N CENTRAL EXPWY SUITE 405 CITY: DALLAS STATE: TX ZIP: 75243 FORMER COMPANY: FORMER CONFORMED NAME: CHANCELLOR BROADCASTING CO DATE OF NAME CHANGE: 19940621 8-K 1 FORM 8-K DATED JULY 2, 1997 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 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): July 2, 1997 CHANCELLOR BROADCASTING COMPANY ________________________________________________________________________________ (Exact Name of Registrant as Specified in its Charter) Delaware ________________________________________________________________________________ (State or Other Jurisdiction of Incorporation) 0-27726 75-2538487 ________________________________ ____________________________________ (Commission File Number) (I.R.S. Employer Identification No.) CHANCELLOR RADIO BROADCASTING COMPANY ________________________________________________________________________________ (Exact Name of Registrant as Specified in its Charter) Delaware ________________________________________________________________________________ (State or Other Jurisdiction of Incorporation) 33-80534 75-2544623 _______________________________ ___________________________________ (Commission File Number) (I.R.S. Employer Identification No.) 12655 North Central Expressway Suite 405 Dallas, Texas 75243 ______________________________________ _________________ (Address of Principal Executive Offices) (Zip Code) (972) 239-6220 ________________________________________________________________________________ (Registrant's Telephone Number, Including Area Code) ________________________________________________________________________________ (Former Name or Former Address, if Changed Since Last Report) ================================================================================ 2 ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS On July 2, 1997, Chancellor Radio Broadcasting Company, a Delaware corporation and direct subsidiary of Chancellor Broadcasting Company, a Delaware corporation (together with its subsidiaries, the "Company"), and Evergreen Media Corporation of Los Angeles, a Delaware corporation ("EMCLA") and direct wholly-owned subsidiary of Evergreen Media Corporation ("Evergreen"), consummated the acquisition of all of the issued and outstanding capital stock of certain subsidiaries (the "Viacom Subsidiaries") of Viacom International, Inc. ("Viacom") for an aggregate purchase price of $1.075 billion plus working capital of approximately $20.7 million (collectively, the "Viacom Acquisition"). The Viacom Subsidiaries own and operate the assets involved in the operation of ten radio broadcast stations. In connection with the Company's pending merger with Evergreen (the "Evergreen Merger"), the Company and Evergreen entered into a Joint Purchase Agreement whereby, among other things, each of the Company and Evergreen divided equally certain costs due in connection with the Viacom Acquisition, including a $53.75 million non-refundable (except under limited circumstances) deposit that was paid by each of the Company and Evergreen on February 19, 1997. Upon the consummation of the Viacom Acquisition, (i) EMCLA purchased the Viacom Subsidiaries that own and operate 2 FM radio stations in New York, New York and 2 FM and 2 AM stations serving the Washington, D.C. market for an aggregate purchase price of approximately $595 million and (ii) Chancellor Radio Broadcasting Company purchased the Viacom Subsidiaries that own and operate 2 FM radio stations in Los Angeles, California, 1 FM station in Chicago, Illinois and 1 FM station in Detroit, Michigan for an aggregate purchase price of approximately $480 million (the "Chancellor Viacom Acquisition"). In April 1997, Chancellor Radio Broadcasting Company entered into an agreement to sell the 1 FM station in Detroit, Michigan that it acquired from Viacom in the Viacom Acquisition to an affiliate of Capital Cities/ABC Radio for $37 million in cash. In connection with the Chancellor Viacom Acquisition, the Chancellor Radio Broadcasting Company entered into an amended and restated credit agreement as of July 2, 1997 (the "Restated Credit Agreement") with a syndicate of commercial banks and other institutions, which provides for aggregate borrowings of up to $750 million. In addition, Chancellor Broadcasting Company entered into a senior credit agreement as of June 26, 1997, that provides for aggregate borrowings of up to $170 million, which were contributed to the capital of Chancellor Radio Broadcasting 2 3 Company as of July 2, 1997. Borrowings under the Restated Credit Agreement and the Senior Credit Agreement were used to fund the Chancellor Viacom Acquisition and fees and expenses related thereto. The aggregate purchase price for the Viacom Acquisition of $1.075 billion, plus working capital (the "Total Viacom Purchase Price"), was determined as a result of an arm's length negotiation between Viacom, Evergreen and the Company. The allocation between the Company and Evergreen of the Total Viacom Purchase Price pursuant to the Joint Purchase Agreement was determined as a result of arm's length negotiations between the Company and Evergreen in connection with the negotiations related to the Evergreen Merger. The Viacom Subsidiaries acquired by the Company own assets that constitute plant, equipment and other physical property used in the operation of radio stations and, subject to the disposition of WDRQ-FM in Detroit described above, will continue to be utilized by the Company for such purposes. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (a) Financial Statements of Business Acquired. The following financial statements of WLIT Inc. and WDRQ Inc. and the combined financial statements of KYSR Inc. and KIBB Inc., have been previously filed with the Securities and Exchange Commission (the "Commission") on the Company's Current Report on Form 8-K dated June 3, 1997 at the corresponding page numbers in such report as set forth below: Financial Statements of Business Acquired -- KYSR Inc. and KIBB Inc. (1) Independent Auditor's Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1 (2) Combined Balance Sheets of KYSR Inc. and KIBB Inc. as of December 31, 1995 and 1996 and March 31, 1997 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-2 (3) Combined Statements of Operations of KYSR Inc. and KIBB Inc. for the years ended December 31, 1994, 1995 and 1996 and the three months ended March 31, 1996 and 1997 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-3 (4) Combined Statements of Cash Flows of KYSR Inc. and KIBB Inc. for the years ended December 31, 1994, 1995 and 1996 and the three months ended March 31, 1996 and 1997 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-4 (5) Notes to Combined Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . B-5
Financial Statements of Business Acquired -- WLIT Inc. 3 4 (1) Independent Auditor's Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1 (2) Balance Sheets of WLIT Inc. as of December 31, 1995 and 1996 and March 31, 1997 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-2 (3) Statements of Earnings of WLIT Inc. for the years ended December 31, 1994, 1995 and 1996 and the three months ended March 31, 1996 and 1997 (unaudited) . . . . . . . . . C-3 (4) Statements of Cash Flows of WLIT Inc. for the years ended December 31, 1994, 1995 and 1996 and the three months ended March 31, 1996 and 1997 (unaudited) . . . . . . . . . C-4 (5) Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-5 Financial Statements of Business Acquired -- WDRQ Inc. (1) Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D-1 (2) Balance Sheets of WDRQ Inc. as of December 31, 1995 and 1996 and March 31, 1997 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D-2 (3) Statements of Earnings of WDRQ Inc. for the years ended December 31, 1994, 1995 and 1996 for the three months ended March 31, 1996 and 1997 (unaudited) . . . . . . . . . D-3 (4) Statements of Cash Flows of WDRQ Inc. for the years ended December 31, 1994, 1995 and 1996 and the three months ended March 31, 1996 and 1997 (unaudited) . . . . . . . . . D-4 (5) Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . D-5
(b) Pro Forma Financial Information. Pro forma financial information for the Chancellor Viacom Acquisition, as well as certain other transactions, has been previously filed with the Commission on the Company's Current Report on Form 8-K dated June 18, 1997. (c) Exhibits. 2.1 Stock Purchase Agreement, dated as of February 16, 1997, between Viacom International, Inc. and Evergreen Media Corporation of Los Angeles.+ 2.2 Joint Purchase Agreement, dated as of February 19, 1997, among Chancellor Broadcasting Company, Chancellor Radio Broadcasting Company, Evergreen Media Corporation and Evergreen Media Corporation of Los Angeles.+ 4 5 4.1 Indenture, dated as of June 24, 1997, among Chancellor Radio Broadcasting Company, as issuer, Trefoil Communications, Inc., Shamrock Broadcasting, Inc., Shamrock Radio Licenses, Inc., Shamrock Broadcasting of Texas, Inc. Shamrock Broadcasting Licenses of Denver, Inc. and Chancellor Broadcasting Licensee Company, as guarantors, and U.S. Trust Company of Texas, N.A., as trustee.* 10.1 Amended and Restated Credit Agreement, dated as of February 14, 1996 and amended and restated as of January 23, 1997 and further amended and restated as of July 2, 1997, among Chancellor Broadcasting Company, Chancellor Radio Broadcasting Company, Various Banks, Goldman Sachs Credit Partners L.P., as documentation agent, NationsBank of Texas, N.A., as syndication agent, Toronto Dominion (Texas), Inc., as syndication agent and Bankers Trust Company, as managing agent and arranger.* 10.2 Senior Credit Agreement, dated as of June 26, 1997, among Chancellor Broadcasting Company, as borrower, the lenders named therein, and Bankers Trust New York Corporation, as agent.* _____________________ * Filed herewith. + Incorporated by reference to the Company's Current Report on Form 8-K dated February 13, 1997 and filed with the Commission on March 11, 1997. 5 6 SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. CHANCELLOR BROADCASTING COMPANY Date: July 17, 1997 By: /s/ ERIC W. NEUMANN ---------------------------------- Eric W. Neumann Senior Vice President CHANCELLOR RADIO BROADCASTING COMPANY Date: July 17, 1997 By: /s/ ERIC W. NEUMANN ---------------------------------- Eric W. Neumann Senior Vice President 6 7 INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION ------ ----------- 2.1 Stock Purchase Agreement, dated as of February 16, 1997, between Viacom International, Inc. and Evergreen Media Corporation of Los Angeles.+ 2.2 Joint Purchase Agreement, dated as of February 19, 1997, among Chancellor Broadcasting Company, Chancellor Radio Broadcasting Company, Evergreen Media Corporation and Evergreen Media Corporation of Los Angeles.+ 4.1 Indenture, dated as of June 24, 1997, among Chancellor Radio Broadcasting Company, as issuer, Trefoil Communications, Inc., Shamrock Broadcasting, Inc., Shamrock Radio Licenses, Inc., Shamrock Broadcasting of Texas, Inc. Shamrock Broadcasting Licenses of Denver, Inc. and Chancellor Broadcasting Licensee Company, as guarantors, and U.S. Trust Company of Texas, N.A., as trustee.* 10.1 Amended and Restated Credit Agreement, dated as of February 14, 1996 and amended and restated as of January 23, 1997 and further amended and restated as of July 2, 1997, among Chancellor Broadcasting Company, Chancellor Radio Broadcasting Company, Various Banks, Goldman Sachs Credit Partners L.P., as documentation agent, NationsBank of Texas, N.A., as syndication agent, Toronto Dominion (Texas), Inc., as syndication agent and Bankers Trust Company, as managing agent and arranger.* 10.2 Senior Credit Agreement, dated as of June 26, 1997, among Chancellor Broadcasting Company, as borrower, the lenders named therein, and Bankers Trust New York Corporation, as agent.*
_____________________ * Filed herewith. + Incorporated by reference to the Company's Current Report on Form 8-K dated February 13, 1997 and filed with the Commission on March 11, 1997. 7 EX-4.1 2 INDENTURE DATED JUNE 24, 1997 1 EXHIBIT 4.1 INDENTURE Dated as of June 24, 1997 Among CHANCELLOR RADIO BROADCASTING COMPANY, as Issuer, THE GUARANTORS named herein and U.S. TRUST COMPANY OF TEXAS, N.A., as Trustee ===================== $200,000,000 8 3/4% Senior Subordinated Notes due 2007 2 CROSS-REFERENCE TABLE
TIA Indenture Section Section - ------- --------- 310(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.10 (a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.10 (a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A. (a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A. (a)(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.08; 7.10 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.08; 7.10; 11.02 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A. 311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.11 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.11 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A. 312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.05 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.03 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.03 313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.06 (b)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A. (b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.06 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.06; 11.02 (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.06 314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.07; 4.09; 11.02 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A. (c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.04 (c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.04 (c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A. (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A. (e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.05 (f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A 315(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.01(b) (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.05; 11.02 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.01(a) (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.01(c) (e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11 316(a)(last sentence) . . . . . . . . . . . . . . . . . . . . . . . .. 2.09 (a)(1)(A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.05 (a)(1)(B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.04 (a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A. (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.07 317(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.08 (a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.09 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.04 318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01
- ---------------------- N.A. means Not Applicable NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a part of the Indenture. 2 3 TABLE OF CONTENTS
PAGE ---- ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE Section 1.01 Definitions . . . . . . . . . . . . . . . . . . . . . . 1 Section 1.02 Incorporation by Reference of TIA . . . . . . . . . . . 23 Section 1.03 Rules of Construction . . . . . . . . . . . . . . . . . 23 ARTICLE TWO THE SECURITIES Section 2.01 Form and Dating . . . . . . . . . . . . . . . . . . . . 24 Section 2.02 Execution and Authentication . . . . . . . . . . . . . . 24 Section 2.03 Registrar and Paying Agent . . . . . . . . . . . . . . . 26 Section 2.04 Paying Agent To Hold Assets in Trust . . . . . . . . . . 27 Section 2.05 Securityholder Lists . . . . . . . . . . . . . . . . . . 27 Section 2.06 Transfer and Exchange . . . . . . . . . . . . . . . . . 27 Section 2.07 Replacement Securities . . . . . . . . . . . . . . . . . 28 Section 2.08 Outstanding Securities . . . . . . . . . . . . . . . . . 29 Section 2.09 Treasury Securities . . . . . . . . . . . . . . . . . . 29 Section 2.10 Temporary Securities . . . . . . . . . . . . . . . . . . 29 Section 2.11 Cancellation . . . . . . . . . . . . . . . . . . . . . . 30 Section 2.12 Defaulted Interest . . . . . . . . . . . . . . . . . . . 30 Section 2.13 CUSIP Number . . . . . . . . . . . . . . . . . . . . . . 31 Section 2.14 Deposit of Moneys . . . . . . . . . . . . . . . . . . . 31 Section 2.15 Book-Entry Provisions for Global Securities . . . . . . 31 Section 2.16 Special Transfer Provisions . . . . . . . . . . . . . . 33 ARTICLE THREE REDEMPTION Section 3.01 Notices to Trustee . . . . . . . . . . . . . . . . . . . 35 Section 3.02 Selection of Securities To Be Redeemed . . . . . . . . . 35 Section 3.03 Notice of Redemption . . . . . . . . . . . . . . . . . . 36 Section 3.04 Effect of Notice of Redemption . . . . . . . . . . . . . 37 Section 3.05 Deposit of Redemption Price . . . . . . . . . . . . . . 37 Section 3.06 Securities Redeemed in Part . . . . . . . . . . . . . . 37 ARTICLE FOUR COVENANTS Section 4.01 Payment of Securities . . . . . . . . . . . . . . . . . 38 Section 4.02 Maintenance of Office or Agency . . . . . . . . . . . . 38 Section 4.03 Limitation on Restricted Payments . . . . . . . . . . . 38
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PAGE ---- Section 4.04 Corporate Existence . . . . . . . . . . . . . . . . . . 42 Section 4.05 Payment of Taxes and Other Claims . . . . . . . . . . . 42 Section 4.06 Maintenance of Properties and Insurance . . . . . . . . 43 Section 4.07 Compliance Certificate; Notice of Default . . . . . . . 43 Section 4.08 Compliance with Laws . . . . . . . . . . . . . . . . . . 44 Section 4.09 SEC Reports . . . . . . . . . . . . . . . . . . . . . . 45 Section 4.10 Waiver of Stay, Extension or Usury Laws . . . . . . . . 45 Section 4.11 Limitation on Transactions with Affiliates . . . . . . . 45 Section 4.12 Limitation on Incurrence of Additional Indebtedness . . 46 Section 4.13 Limitation on Dividend and Other Payment Restrictions Affecting Subsidiaries . . . . . . . . . . . . . . . . . 46 Section 4.14 Prohibition on Incurrence of Senior Subordinated Indebtedness . . . . . . . . . . . . . . . . . . . . . . 47 Section 4.15 Change of Control . . . . . . . . . . . . . . . . . . . 48 Section 4.16 Limitation on Asset Sales . . . . . . . . . . . . . . . 50 Section 4.17 Limitation on Preferred Stock of Subsidiaries . . . . . 54 Section 4.18 Limitation on Liens . . . . . . . . . . . . . . . . . . 54 Section 4.19 Guarantees of Certain Indebtedness . . . . . . . . . . . 54 Section 4.20 Limitation on Sale and Leaseback Transactions . . . . . 55 Section 4.21 Limitation on Line of Business . . . . . . . . . . . . . 55 Section 4.22 Limitation on Asset Swaps . . . . . . . . . . . . . . . 55 ARTICLE FIVE SUCCESSOR CORPORATION Section 5.01 When Company May Merge, Etc. . . . . . . . . . . . . . . 56 Section 5.02 Successor Corporation Substituted . . . . . . . . . . . 57 ARTICLE SIX DEFAULT AND REMEDIES Section 6.01 Events of Default . . . . . . . . . . . . . . . . . . . 57 Section 6.02 Acceleration . . . . . . . . . . . . . . . . . . . . . . 59 Section 6.03 Other Remedies . . . . . . . . . . . . . . . . . . . . . 60 Section 6.04 Waiver of Past Defaults . . . . . . . . . . . . . . . . 60 Section 6.05 Control by Majority . . . . . . . . . . . . . . . . . . 61 Section 6.06 Limitation on Suits . . . . . . . . . . . . . . . . . . 61 Section 6.07 Rights of Holders To Receive Payment . . . . . . . . . 61 Section 6.08 Collection Suit by Trustee . . . . . . . . . . . . . . . 62 Section 6.09 Trustee May File Proofs of Claim . . . . . . . . . . . . 62 Section 6.10 Priorities . . . . . . . . . . . . . . . . . . . . . . 63 Section 6.11 Undertaking for Costs . . . . . . . . . . . . . . . . . 63 ARTICLE SEVEN TRUSTEE Section 7.01 Duties of Trustee . . . . . . . . . . . . . . . . . . . 64 Section 7.02 Rights of Trustee . . . . . . . . . . . . . . . . . . . 65
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PAGE ---- Section 7.03 Individual Rights of Trustee . . . . . . . . . . . . . . 67 Section 7.04 Trustee's Disclaimer . . . . . . . . . . . . . . . . . . 67 Section 7.05 Notice of Default . . . . . . . . . . . . . . . . . . . 67 Section 7.06 Reports by Trustee to Holders . . . . . . . . . . . . . 67 Section 7.07 Compensation and Indemnity . . . . . . . . . . . . . . . 68 Section 7.08 Replacement of Trustee . . . . . . . . . . . . . . . . . 69 Section 7.09 Successor Trustee by Merger, Etc. . . . . . . . . . . . 70 Section 7.10 Eligibility; Disqualification . . . . . . . . . . . . . 70 Section 7.11 Preferential Collection of Claims Against the Company . . 71 ARTICLE EIGHT DISCHARGE OF INDENTURE; DEFEASANCE Section 8.01 Termination of the Company's Obligations . . . . . . . . 71 Section 8.02 Acknowledgment of Discharge by Trustee . . . . . . . . . 74 Section 8.03 Application of Trust Money . . . . . . . . . . . . . . . 74 Section 8.04 Repayment to the Company . . . . . . . . . . . . . . . . 74 Section 8.05 Reinstatement . . . . . . . . . . . . . . . . . . . . . 74 ARTICLE NINE AMENDMENTS, SUPPLEMENTS AND WAIVERS Section 9.01 Without Consent of Holders . . . . . . . . . . . . . . . 75 Section 9.02 With Consent of Holders . . . . . . . . . . . . . . . . 75 Section 9.03 Compliance with TIA . . . . . . . . . . . . . . . . . . 77 Section 9.04 Revocation and Effect of Consents . . . . . . . . . . . 77 Section 9.05 Notation on or Exchange of Securities . . . . . . . . . 78 Section 9.06 Trustee To Sign Amendments, Etc. . . . . . . . . . . . . 78 ARTICLE TEN SUBORDINATION OF SECURITIES Section 10.01 Securities Subordinated to Senior Indebtedness . . . . . 78 Section 10.02 No Payment on Securities in Certain Circumstances . . . 79 Section 10.03 Payment Over of Proceeds upon Dissolution, Etc. . . . . . 81 Section 10.04 Payments May Be Paid Prior to Dissolution . . . . . . . 83 Section 10.05 Subrogation . . . . . . . . . . . . . . . . . . . . . . 83 Section 10.06 Obligations of the Company Unconditional . . . . . . . . 84 Section 10.07 Notice to Trustee . . . . . . . . . . . . . . . . . . . 84 Section 10.08 Reliance on Judicial Order or Certificate of Liquidating Agent . . . . . . . . . . . . . . . . . . . 85 Section 10.09 Trustee's Relation to Senior Indebtedness . . . . . . . 85 Section 10.10 Subordination Rights Not Impaired by Acts or Omissions of the Company or Holders of Senior Indebtedness . . . . 85
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PAGE ---- Section 10.11 Securityholders Authorize Trustee To Effectuate Subordination of Securities . . . . . . . . . . . . . . 87 Section 10.12 This Article Ten Not To Prevent Events of Default . . . 87 Section 10.13 Trustee's Compensation Not Prejudiced . . . . . . . . . 87 ARTICLE TEN A GUARANTEES OF THE SECURITIES Section 10A.01 Guarantees . . . . . . . . . . . . . . . . . . . . . . . 87 Section 10A.02 Execution and Delivery of the Guarantees . . . . . . . . 90 Section 10A.03 Additional Guarantors . . . . . . . . . . . . . . . . . 90 Section 10A.04 Limitation of Guarantors' Liability . . . . . . . . . . 90 Section 10A.05 Guarantors May Consolidate, etc., on Certain Terms . . . 91 Section 10A.06 Contribution . . . . . . . . . . . . . . . . . . . . . . 92 Section 10A.07 Waiver of Subrogation . . . . . . . . . . . . . . . . . 92 ARTICLE TEN B SUBORDINATION OF GUARANTEES Section 10B.01 Guarantee Obligations Subordinated to Guarantor Senior Indebtedness . . . . . . . . . . . . . 93 Section 10B.02 No Payment on Guarantees in Certain Circumstances . . . 94 Section 10B.03 Payment Over of Proceeds upon Dissolution, Etc. . . . . . 96 Section 10B.04 Payments May Be Paid Prior to Dissolution . . . . . . . 98 Section 10B.05 Subrogation . . . . . . . . . . . . . . . . . . . . . . 99 Section 10B.06 Guarantee Provisions Solely To Define Relative Rights . . 99 Section 10B.07 Trustee To Effectuate Subordination of Obligations Under the Guarantees . . . . . . . . . . . . . . . . . . 100 Section 10B.08 No Waiver of Guarantee Subordination Provisions . . . . . 100 Section 10B.09 Guarantors To Give Notice to Trustee . . . . . . . . . . 101 Section 10B.10 Reliance on Judicial Order or Certificate of Liquidating Agent Regarding Dissolution, etc., of Guarantors . . . . 102 Section 10B.11 Rights of Trustee as a Holder of Guarantor Senior Indebtedness; Preservation of Trustee's Rights . . . . . 102 Section 10B.12 No Suspension of Remedies . . . . . . . . . . . . . . . 103 Section 10B.13 Trustee's Relation to Guarantor Senior Indebtedness . . 103 Section 10B.14 Subordination Rights Not Impaired by Acts or Omissions of the Guarantors or Holders of Guarantors Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . 104
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PAGE ---- Section 10B.15 This Article Ten B Not To Prevent Events of Default . . 104 ARTICLE ELEVEN MISCELLANEOUS Section 11.01 TIA Controls . . . . . . . . . . . . . . . . . . . . . . 105 Section 11.02 Notices . . . . . . . . . . . . . . . . . . . . . . . . 105 Section 11.03 Communications by Holders with Other Holders . . . . . . 106 Section 11.04 Certificate and Opinion as to Conditions Precedent . . . 106 Section 11.05 Statements Required in Certificate or Opinion . . . . . . 106 Section 11.06 Rules by Trustee, Paying Agent, Registrar . . . . . . . 107 Section 11.07 Legal Holidays . . . . . . . . . . . . . . . . . . . . . 107 Section 11.08 Governing Law . . . . . . . . . . . . . . . . . . . . . 107 Section 11.09 No Adverse Interpretation of Other Agreements . . . . . . 107 Section 11.10 No Recourse Against Others . . . . . . . . . . . . . . . 108 Section 11.11 Successors . . . . . . . . . . . . . . . . . . . . . . . 108 Section 11.12 Duplicate Originals . . . . . . . . . . . . . . . . . . 108 Section 11.13 Severability . . . . . . . . . . . . . . . . . . . . . . 108 Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Exhibit A-1 - Form of Series A Security Exhibit A-2 - Form of Series B Security Exhibit B - Form of Legend for Book-Entry Securities Exhibit C - Transferee Certificate for Non-QIB Accredited Investors Exhibit D - Transferee Certificate for Transfers Pursuant to Regulation S Note: This Table of Contents shall not, for any purpose, be deemed to be part of the Indenture. 7 8 INDENTURE, dated as of June 24, 1996, among Chancellor Radio Broadcasting Company, a Delaware corporation (the "Company"), Trefoil Communications, Inc., Shamrock Broadcasting, Inc., Shamrock Radio Licenses, Inc., Shamrock Broadcasting of Texas, Inc., Shamrock Broadcasting Licenses of Denver, Inc. and Chancellor Broadcasting Licensee Company (collectively the "Guarantors") and U.S. Trust Company of Texas, N.A., a national banking association, as trustee (the "Trustee"). Each party hereto agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of the Company's 8 3/4% Senior Subordinated Notes due 2007 (the "Securities"): I. DEFINITIONS AND INCORPORATION BY REFERENCE A. Definitions. "Acceleration Notice" has the meaning provided in Section 6.02. "Acquired Indebtedness" means Indebtedness of a Person or any of its Subsidiaries existing at the time such Person becomes a Subsidiary of the Company or at the time it merges or consolidates with the Company or any of its Subsidiaries or assumed in connection with the acquisition of assets from such Person and not incurred by such Person in connection with, or in anticipation or contemplation of, such Person becoming a Subsidiary of the Company or such acquisition, merger or consolidation. "Acquired Preferred Stock" means Preferred Stock of any Person at the time such Person becomes a Subsidiary of the Company or at the time it merges or consolidates with the Company or any of its Subsidiaries and not issued by such Person in connection with, or in anticipation or contemplation of, such acquisition, merger or consolidation. "Adjusted Net Assets" of a Guarantor at any date shall mean the lesser of the amount by which (x) the fair value of the property of such Guarantor exceeds the total amount of liabilities, including, without limitation, contingent liabilities (after giving effect to all other fixed and contingent liabilities incurred or assumed on such date), but excluding 8 9 liabilities under the Guarantee of such Guarantor at such date, and (y) the present fair salable value of the assets of such Guarantor at such date exceeds the amount that will be required to pay the probable liability of such Guarantor on its debts (after giving effect to all other fixed and contingent liabilities incurred or assumed on such date and after giving effect to any collection from any Subsidiary of such Guarantor in respect of the obligations of such Subsidiary under the Guarantee), excluding debt in respect of the Guarantee, as they become absolute and matured. "Affiliate" means a Person who, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company. The term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. "Affiliate Transaction" has the meaning provided in Section 4.11. "Agent" means any Registrar, Paying Agent or Co-Registrar. "Agent Members" has the meaning provided in Section 2.15. "Asset Acquisition" means (i) an Investment by the Company or any Subsidiary of the Company in any other Person pursuant to which such Person shall become a Subsidiary of the Company or shall be consolidated or merged with the Company or any Subsidiary of the Company or (ii) the acquisition by the Company or any Subsidiary of the Company of assets of any Person comprising a division or line of business of such Person. "Asset Sale" means any direct or indirect sale, issuance, conveyance, transfer, lease (other than operating leases entered into in the ordinary course of business), assignment or other transfer for value by the Company or any of its Subsidiaries (excluding any Sale and Leaseback Transaction or any pledge of assets or stock by the Company or any of its Subsidiaries) to any Person other than the Company or a Wholly Owned Subsidiary of the Company of (i) any Capital Stock of any Subsidiary of the Company or (ii) any other property or assets of the Company or any Subsidiary of the Company other than in the ordinary course of business; provided, however, that for purposes of Section 4.16, Asset Sales shall not include (a) a transaction or series of related transactions for which the Company or its Subsidiaries receive aggregate consideration of less than $500,000, (b) transactions permitted under Section 4.22 or (c) transactions permitted under Section 5.01. 9 10 "Asset Swap" means the execution of a definitive agreement, subject only to approval of the Federal Communications Commission and other customary closing conditions, that the Company in good faith believes will be satisfied, for a substantially concurrent purchase and sale, or exchange, of Productive Assets between the Company or any of its Subsidiaries and another Person or group of affiliated Persons; provided that any amendment to or waiver of any closing condition which individually or in the aggregate is material to the Asset Swap shall be deemed to be a new Asset Swap. "Attributable Value" in respect of a sale and leaseback arrangement of any property means, as at the time of determination, the greater of (i) the fair market value of the property subject to such arrangement (as determined in good faith by the Board of Directors of the Company) or (ii) the present value (discounted at the interest rate borne by the Securities, compounded annually) of the total obligations of the lessee for rental payments during the remaining term of the lease included in such arrangement. "Bankruptcy Law" means Title 11, United States Code or any similar federal, state or foreign law for the relief of debtors. "Blockage Period" shall have the meaning provided in Section 10.02. "Board of Directors" means, with respect to any Person, the board of directors (or any other equivalent governing body) of such Person or any committee of the board of directors of such Person duly authorized, with respect to any particular matter, to exercise the power of the board of directors of such Person. "Board Resolution" means, with respect to any Person, a duly adopted resolution of the Board of Directors of such Person. "Business Day" means a day that is not a Legal Holiday. "Capitalized Lease Obligation" means, as to any Person, the obligation of such Person to pay rent or other amounts under a lease to which such Person is a party that is required to be classified and accounted for as a capital lease obligation under GAAP and, for purposes of this definition, the amount of such obligation at any date shall be the capitalized amount of such obligation at such date, determined in accordance with GAAP. "Capital Stock" means (i) with respect to any Person 10 11 that is a corporation, any and all shares, interests, participations or other equivalents (however designated) of capital stock, including each class of common stock and Preferred Stock of such Person and (ii) with respect to any Person that is not a corporation, any and all partnership or other equity interests of such Person. "Cash Equivalents" means (i) marketable direct obligations issued by, or unconditionally guaranteed by, the United States Government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition thereof; (ii) marketable direct obligations issued by any state of the United States of America or any political subdivision of any such state or any public instrumentality thereof maturing within one year from the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either Standard & Poor's Corporation or Moody's Investors Service, Inc.; (iii) commercial paper maturing no more than one year from the date of creation thereof and, at the time of acquisition, having a rating of at least A-1 from Standard & Poor's Corporation or at least P-1 from Moody's Investors Service, Inc.; (iv) certificates of deposit or bankers' acceptances maturing within one year from the date of acquisition thereof issued by any commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia or any U.S. branch of a foreign bank having at the date of acquisition thereof combined capital and surplus of not less than $200,000,000; (v) repurchase obligations with a term of not more than seven days for underlying securities of the types described in clause (i) above entered into with any bank meeting the qualifications specified in clause (iv) above; and (vi) investments in money market funds which invest substantially all their assets in securities of the types described in clauses (i) through (v) above. "Change of Control" means the occurrence of one or more of the following events: (i) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of the Company to any Person or group of related Persons for purposes of Section 13(d) of the Exchange Act (a "Group") (whether or not otherwise in compliance with the provisions of this Indenture), other than (x) in the event the Evergreen Merger is not consummated, to Hicks Muse or any of its Affiliates, officers and directors or to Steven Dinetz and (y) if the Evergreen Merger is consummated, from and after the effective date thereof, to Hicks Muse or any of its Affiliates, officers, and directors or to Steven Dinetz or Scott K. Ginsburg (the "Permitted Holders"); or (ii) a majority of the Board of Directors of Holdings or the Company shall consist of Persons who 11 12 are not Continuing Directors; or (iii) the acquisition by any Person or Group (other than the Permitted Holders) of the power, directly or indirectly, to vote or direct the voting of securities having more than 50% of the ordinary voting power for the election of directors of Holdings or the Company. "Change of Control Date" has the meaning provided in Section 4.15. "Change of Control Offer" has the meaning provided in Section 4.15. "Change of Control Payment Date" has the meaning provided in Section 4.15. "Commodity Agreement" means any commodity futures contract, commodity option or other similar agreement or arrangement entered into by the Company or any of its Subsidiaries designed to protect the Company or any of its Subsidiaries against fluctuations in the price of commodities actually used in the ordinary course of business of the Company and its Subsidiaries. "Company" means the party named as such in this Indenture until a successor replaces it pursuant to this Indenture and thereafter means such successor and also includes for the purposes of any provision contained herein and required by the TIA any other obligor on the Securities. "Consolidated EBITDA" means, with respect to any Person, for any period, the sum (without duplication) of (i) Consolidated Net Income and (ii) to the extent Consolidated Net Income has been reduced thereby, (A) all income taxes of such Person and its Subsidiaries paid or accrued in accordance with GAAP for such period (other than income taxes attributable to extraordinary or non-recurring gains or losses), (B) Consolidated Interest Expense and (C) Consolidated Non-Cash Charges, all as determined on a consolidated basis for such Person and its Subsidiaries in conformity with GAAP. "Consolidated Interest Expense" means, with respect to any Person for any period, without duplication, the sum of (i) the interest expense of such Person and its Subsidiaries for such period as determined on a consolidated basis in accordance with GAAP, including, without limitation, (a) any amortization of debt discount, (b) the net cost under Interest Swap Obligations (including any amortization of discounts), (c) the interest portion of any deferred payment obligation, (d) all commissions, discounts and other fees and charges owed with respect to letters of credit, bankers' acceptance financing or similar facilities, and (e) all accrued interest and (ii) the interest component of Capitalized Lease Obligations paid or 12 13 accrued by such Person and its Subsidiaries during such period as determined on a consolidated basis in accordance with GAAP. "Consolidated Net Income" of any Person means, for any period, the aggregate net income (or loss) of such Person and its Subsidiaries for such period on a consolidated basis, determined in accordance with GAAP; provided that there shall be excluded therefrom, without duplication, (a) gains and losses from Asset Sales (without regard to the $500,000 limitation set forth in the definition thereof) or abandonments or reserves relating thereto and the related tax effects, (b) items classified as extraordinary or nonrecurring gains and losses, and the related tax effects according to GAAP, (c) the net income (or loss) of any Person acquired in a pooling of interests transaction accrued prior to the date it becomes a Subsidiary of such first referred to Person or is merged or consolidated with it or any of its Subsidiaries, (d) the net income of any Subsidiary to the extent that the declaration of dividends or similar distributions by that Subsidiary of that income is restricted by contract, operation of law or otherwise and (e) the net income of any Person, other than a Subsidiary, except to the extent of the lesser of (x) dividends or distributions paid to such first referred to Person or its Subsidiary by such Person and (y) the net income of such Person (but in no event less than zero), and the net loss of such Person shall be included only to the extent of the aggregate Investment of the first referred to Person or a consolidated Subsidiary of such Person. "Consolidated Non-Cash Charges" means, with respect to any Person for any period, the aggregate depreciation, amortization and other non-cash expenses of such Person and its Subsidiaries reducing Consolidated Net Income of such Person and its Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP (excluding any such charges constituting an extraordinary or nonrecurring item). "Continuing Director" means, as of the date of determination, any Person who (i) was a member of the Board of Directors of Holdings or the Company on the date of this Indenture or becomes a director upon consummation of the Evergreen Merger, (ii) was nominated for election or elected to the Board of Directors of Holdings or the Company with the affirmative vote of a majority of the Continuing Directors who were members of such Board of Directors at the time of such nomination or election, or (iii) is a representative of a Permitted Holder. "Credit Agreement" means the Credit Agreement, dated on or about February 14, 1996, as amended and restated as of January 23, 1997, among Holdings, the Company, the lenders from time to time party thereto and Bankers Trust Company as managing agent, together with the related documents thereto 13 14 (including, without limitation, any guarantee agreements and security documents), in each case, as such agreements may be amended (including any amendment and restatement thereof), supplemented or otherwise modified from time to time, including any agreement extending the maturity of, refinancing, replacing or otherwise restructuring (including by way of adding Subsidiaries of the Company as additional borrowers or guarantors thereunder) all or any portion of the Indebtedness under such agreement or any successor or replacement agreement and whether by the same or any other agent, lender or group of lenders. "Currency Agreement" means any foreign exchange contract, currency swap agreement or other similar agreement or arrangement designed to protect the Company or any of its Subsidiaries against fluctuations in currency values. "Custodian" means any receiver, trustee, assignee, liquidator, sequestrator or similar official under any Bankruptcy Law. "Default" means an event or condition the occurrence of which is, or with the lapse of time or the giving of notice or both would be, an Event of Default. "Default Notice" shall have the meaning provided in Section 10.02. "Depository" means The Depository Trust Company or another Person designated as Depository by the Company, which must be a clearing agency registered under the Exchange Act. "Designated Guarantor Senior Indebtedness" means (i) Indebtedness guaranteed by a Guarantor under or in respect of the Credit Agreement and (ii) any other Indebtedness constituting Guarantor Senior Indebtedness which, at the time of determination, has an aggregate principal amount of at least $25,000,000 and is specifically designated in the instrument evidencing such Guarantor Senior Indebtedness as "Designated Guarantor Senior Indebtedness" by the Guarantor. "Designated Senior Indebtedness" means (i) Indebtedness under or in respect of the Credit Agreement and (ii) any other Indebtedness constituting Senior Indebtedness which, at the time of determination, has an aggregate principal amount of at least $25,000,000 and is specifically designated in the instrument evidencing such Senior Indebtedness as "Designated Senior Indebtedness" by the Company. "Discharged" has the meaning provided in Section 8.01. 14 15 "Disqualified Capital Stock" means any Capital Stock which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, matures (excluding any maturity as the result of an optional redemption by the issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the sole option of the holder thereof (except, in each case, upon the occurrence of a Change of Control), in whole or in part, on or prior to the final maturity date of the Securities. "Event of Default" has the meaning provided in Section 6.01. "Evergreen Merger" means the merger of the Company with and into Evergreen Media Corporation and its subsidiaries. "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated by the SEC thereunder. "Financial Monitoring and Oversight Agreements" means the Financial Monitoring and Oversight Agreement among Hicks, Muse & Co. Partners, L.P., the Company and Holdings as in effect on the 1996 Issue Date, and the Financial Advisory Agreement among HM2/Management Partners, L.P., the Company and Holdings, as in effect on the 1996 Notes Issue Date, or as amended in connection with the Evergreen Merger as described under the captions "Certain Transactions -- Final Monitoring and Oversight Agreement" and "--Financial Advisory Agreement" in the Offering Circular. "Funding Guarantor" has the meaning provided in Section 10A.06. "Funds" has the meaning provided in Section 8.01. "GAAP" means generally accepted accounting principles as in effect in the United States of America as of the Issue Date. "Global Securities" has the meaning provided in Section 2.02. "Guarantees" means the guarantees of the Securities on a senior subordinated basis by the Guarantors pursuant to Article Ten A. "Guarantor" means (i) initially Trefoil Communications, Inc., Shamrock Broadcasting, Inc., Shamrock Radio Licenses, Inc., Shamrock Broadcasting of Texas, Inc., Shamrock Broadcasting Licenses of Denver, Inc. and Chancellor Broadcast- 15 16 ing Licensee Company and (ii) each of the Company's Subsidiaries that in the future executes a supplemental indenture in which such Subsidiary agrees to be bound by the terms of this Indenture as a Guarantor; provided that any Person constituting a Guarantor as described above shall cease to constitute a Guarantor when its respective Guarantee is released in accordance with the terms thereof. "Guarantor Senior Indebtedness" means any Indebtedness of a Guarantor (including any interest accruing subsequent to the filing of a petition of bankruptcy at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable law), whether outstanding on the Issue Date or thereafter created, incurred or assumed, unless, in the case of any particular Indebtedness, the instrument creating or evidencing the same or pursuant to which the same is outstanding expressly provides that such Indebtedness shall not be senior in right of payment to the Guarantees. Without limiting the generality of the foregoing, "Guarantor Senior Indebtedness" shall also include the principal of, premium, if any, interest (including any interest accruing subsequent to the filing of a petition of bankruptcy at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable law) on, and all other amounts owing in respect of, and all monetary obligations of every nature under, (x) the Credit Agreement, including, without limitation, obligations to pay principal and interest, reimbursement obligations under letters of credit, fees, expenses and indemnities, and (y) all Interest Swap Obligations. Notwithstanding the foregoing, Guarantor Senior Indebtedness shall not include any of the following amounts (whether or not constituting Indebtedness as defined in this Indenture): (i) any Indebtedness of a Guarantor to a Subsidiary of such Guarantor; (ii) Indebtedness and other amounts owing to trade creditors incurred in connection with obtaining goods, materials or services; (iii) Indebtedness represented by Disqualified Capital Stock; (iv) any liability for federal, state, local or other taxes owed or owing by a Guarantor; (v) any Indebtedness which is, by its express terms, subordinated in right of payment to any other Indebtedness of such Guarantor; and (vi) guarantees of the 1996 Notes. "Hicks Muse" means Hicks, Muse, Tate & Furst Incorporated, a Delaware corporation. "Holder" or "Securityholder" means the Person in whose name a Security is registered on the Registrar's books. "Holdings" means Chancellor Broadcasting Company, a Delaware corporation, parent of the Company. "Indebtedness" means with respect to any Person, 16 17 without duplication, any liability of such Person (i) for borrowed money, (ii) evidenced by bonds, debentures, notes or other similar instruments, (iii) constituting Capitalized Lease Obligations, (iv) incurred or assumed as the deferred purchase price of property, or pursuant to conditional sale obligations and title retention agreements (but excluding trade accounts payable arising in the ordinary course of business), (v) for the reimbursement of any obligor on any letter of credit, banker's acceptance or similar credit transaction, (vi) for Indebtedness of others guaranteed by such Person, (vii) for Interest Swap Obligations, Commodity Agreements and Currency Agreements and (viii) for Indebtedness of any other Person of the type referred to in clauses (i) through (vii) which are secured by any Lien on any property or asset of such first referred to Person, the amount of such Indebtedness being deemed to be the lesser of the value of such property or asset or the amount of the Indebtedness so secured. The amount of Indebtedness of any Person at any date shall be the outstanding principal amount of all unconditional obligations described above, as such amount would be reflected on a balance sheet prepared in accordance with GAAP, and the maximum liability at such date of such Person for any contingent obligations described above. "Indenture" means this Indenture, as amended or supplemented from time to time in accordance with the terms hereof. "Initial Purchasers" means Credit Suisse First Boston Corporation, BT Securities Corporation and Morgan Stanley & Co. Incorporated, pursuant to the Purchase Agreement. "Institutional Accredited Investor" means an institution that is an "accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act. "Interest Payment Date" means the stated maturity of an installment of interest on the Securities. "Interest Swap Obligations" means the obligations of any Person under any interest rate protection agreement, interest rate future, interest rate option, interest rate swap, interest rate cap or other interest rate hedge or arrangement. "Investment" means (i) any transfer or delivery of cash, stock or other property of value in exchange for Indebtedness, stock or other security or ownership interest in any Person by way of loan, advance, capital contribution, guarantee or otherwise and (ii) an investment deemed to have been made by the Company at the time any entity which was a Subsidiary of the Company ceases to be such a Subsidiary in an amount equal to the value of the loans and advances made, and any remaining ownership interest in, such entity immediately following such 17 18 entity ceasing to be a Subsidiary of the Company. The amount of any non-cash Investment shall be the fair market value of such Investment, as determined conclusively in good faith by management of the Company unless the fair market value of such Investment exceeds $1,000,000, in which case the fair market value shall be determined conclusively in good faith by the Board of Directors of the Company at the time such Investment is made. "Issue Date" means the date of original issuance of the Securities. "Legal Holiday" has the meaning provided in Section 11.07. "Leverage Ratio" shall mean, as to any Person, the ratio of (i) the sum of the aggregate outstanding amount of Indebtedness of such Person and its Subsidiaries as of the date of calculation on a consolidated basis in accordance with GAAP to (ii) the Consolidated EBITDA of such Person for the four full fiscal quarters (the "Four Quarter Period") ending on or prior to the date of determination. For purposes of this definition, the aggregate outstanding principal amount of Indebtedness of the Person and its Subsidiaries for which such calculation is made shall be determined on a pro forma basis as if the Indebtedness giving rise to the need to perform such calculation had been incurred and the proceeds therefrom had been applied, and all other transactions in respect of which such Indebtedness is being incurred had occurred, on the last day of the Four Quarter Period. In addition to the foregoing, for purposes of this definition, "Consolidated EBITDA" shall be calculated on a pro forma basis after giving effect to (i) the incurrence of the Indebtedness of such Person and its Subsidiaries (and the application of the proceeds therefrom) giving rise to the need to make such calculation and any incurrence (and the application of the proceeds therefrom) or repayment of other Indebtedness, other than the incurrence or repayment of Indebtedness pursuant to working capital facilities, at any time subsequent to the beginning of the Four Quarter Period and on or prior to the date of determination, as if such incurrence (and the application of the proceeds thereof) or the repayment, as the case may be, occurred on the first day of the Four Quarter Period and (ii) any Asset Sales or Asset Acquisitions (including, without limitation, any Asset Acquisition giving rise to the need to make such calculation as a result of such Person or one of its Subsidiaries (including any Person who becomes a Subsidiary as a result of such Asset Acquisition) incurring, assuming or otherwise becoming liable for Indebtedness) at any time on or subsequent to the first day of the Four Quarter Period and on or prior to the date of determination, as if such Asset Sale or Asset 18 19 Acquisition (including the incurrence, assumption or liability for any such Indebtedness and also including any Consolidated EBITDA associated with such Asset Acquisition) occurred on the first day of the Four Quarter Period. Furthermore, in calculating "Consolidated Interest Expense" for purposes of the calculation of "Consolidated EBITDA," (i) interest on Indebtedness determined on a fluctuating basis as of the date of determination (including Indebtedness actually incurred on the date of the transaction giving rise to the need to calculate the Leverage Ratio) and which will continue to be so determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such Indebtedness as in effect on the date of determination and (ii) notwithstanding (i) above, interest determined on a fluctuating basis, to the extent such interest is covered by Interest Swap Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of such agreements. "Lien" means any lien, mortgage, deed of trust, pledge, security interest, charge or encumbrance of any kind (including any conditional sale or other title retention agreement, any lease in the nature thereof and any agreement to give any security interest). "Maturity Date" means June 15, 2007. "Net Cash Proceeds" means, with respect to any Asset Sale, the proceeds in the form of cash or Cash Equivalents (including payments in respect of deferred payment obligations when received in the form of cash or Cash Equivalents) received by the Company or any of its Subsidiaries from such Asset Sale net of (i) reasonable out-of-pocket expenses and fees relating to such Asset Sale (including, without limitation, legal, accounting and investment banking fees and sales commissions, recording fees, title insurance premiums, appraisers fees and costs reasonably incurred in preparation of any asset or property for sale), (ii) taxes paid or reasonably estimated to be payable (calculated based on the combined state, federal and foreign statutory tax rates applicable to the Company or the Subsidiary engaged in such Asset Sale) and (iii) repayment of Indebtedness secured by assets subject to such Asset Sale; provided that if the instrument or agreement governing such Asset Sale requires the transferor to maintain a portion of the purchase price in escrow (whether as a reserve for adjustment of the purchase price or otherwise) or to indemnify the transferee for specified liabilities in a maximum specified amount, the portion of the cash or Cash Equivalents that is actually placed in escrow or segregated and set aside by the transferor for such indemnification obligation shall not be deemed to be Net Cash Proceeds until the escrow terminates or the transferor ceases to segregate and set aside such funds, in whole or in part, and then only to the extent of the proceeds released from 19 20 escrow to the transferor or that are no longer segregated and set aside by the transferor. "Net Proceeds Offer" has the meaning provided in Section 4.16. "Non-U.S. Person" means a person who is not a U.S. person, as defined in Regulation S. "1996 Notes" means $200.0 million aggregate principal amount of 9 3/8% Senior Subordinated Notes due 2004 of the Company, issued pursuant to an indenture (the "1996 Note Indenture"), dated as of February 14, 1996, as the same may be modified or amended from time to time and future refinancings thereof. "1996 Notes Issue Date" means February 14, 1996. "Obligations" means all obligations for principal, premium, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing, or otherwise relating to, any Indebtedness. "Offering Circular" means the Offering Circular dated June 18, 1997 pursuant to which $200.0 million aggregate principal amount of the Securities were offered, and any supplement thereto. "Officer" means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Chief Financial Officer, the Treasurer, the Controller, or the Secretary of such Person, or any other officer designated by the Board of Directors serving in a similar capacity. "Officers' Certificate" means, with respect to any Person, a certificate signed by two Officers or by an Officer and either an Assistant Treasurer or an Assistant Secretary of such Person and otherwise complying with the requirements of Sections 11.04 and 11.05, as they relate to the making of an Officers' Certificate. "Offshore Physical Securities" has the meaning provided in Section 2.02. "Opinion of Counsel" means a written opinion from legal counsel who is reasonably acceptable to the Trustee complying with the requirements of Sections 11.04 and 11.05, as they relate to the giving of an Opinion of Counsel. "Paying Agent" has the meaning provided in 20 21 Section 2.03, except that, during the continuance of a Default or Event of Default and for the purposes of Articles Three and Eight and Sections 4.14 and 4.15, the Paying Agent shall not be the Company or any Affiliate of the Company. "Pending Transactions" has the meaning set forth under the caption "Business -- Evergreen -- Evergreen Pending Transactions" in the Offering Circular. "Permitted Indebtedness" means, without duplication, (i) the Securities; (ii) the Guarantee; (iii) Indebtedness of the Company incurred pursuant to the Credit Agreement in an aggregate principal amount at any time outstanding not to exceed the sum of the aggregate commitments pursuant to the Credit Agreement as initially in effect on the 1996 Notes Issue Date reduced by the aggregate principal amount permanently repaid with the proceeds of Asset Sales; (iv) Indebtedness outstanding on the 1996 Notes Issue Date; (v) Interest Swap Obligations; provided that such Interest Swap Obligations are entered into to protect the Company from fluctuations in interest rates of its Indebtedness; (vi) additional Indebtedness of the Company or any of its Subsidiaries not to exceed $10,000,000 in principal amount outstanding at any time (which amount may, but need not, be incurred under the Credit Agreement); (vii) Refinancing Indebtedness; (viii) Indebtedness owed by the Company to any Wholly Owned Subsidiary or by any Subsidiary to the Company or any Wholly Owned Subsidiary of the Company; and (ix) guarantees by Subsidiaries of any Indebtedness permitted to be incurred pursuant to this Indenture. "Permitted Investments" means (i) Investments by the Company or any Subsidiary to acquire the stock or assets of any Person (or Indebtedness of such Person acquired in connection with a transaction in which such Person becomes a Subsidiary of the Company) engaged in the broadcast business or businesses reasonably related thereto; provided that if any such Investment or series of related Investments involves an Investment by the Company in excess of $5,000,000, the Company is able, at the time of such Investment and immediately after giving effect thereto, to incur at least $1.00 of additional Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.12, (ii) Investments received by the Company or its Subsidiaries as consideration for a sale of assets, including an Asset Sale effected in compliance with Section 4.16, (iii) Investments by the Company or any Wholly Owned Subsidiary of the Company in any Wholly Owned Subsidiary of the Company (whether existing on the Issue Date or created thereafter) or any Person that after such Investments, and as a result thereof, becomes a Wholly Owned Subsidiary of the Company and Investments in the Company by any Wholly Owned Subsidiary of the Company, (iv) cash and Cash Equivalents, (v) Investments in securities of trade creditors, wholesalers or customers 21 22 received pursuant to any plan of reorganization or similar arrangement and (vi) additional Investments in an aggregate amount not to exceed $2,500,000 at any time outstanding. "Permitted Liens" means (i) Liens for taxes, assessments and governmental charges to the extent not required to be paid under this Indenture, (ii) statutory Liens of landlords and carriers, warehousemen, mechanics, suppliers, materialmen, repairmen or other like Liens to the extent not required to be paid under this Indenture, (iii) pledges or deposits to secure lease obligations or nondelinquent obligations under workers' compensation, unemployment insurance or similar legislation, (iv) Liens to secure the performance of public statutory obligations that are not delinquent, performance bonds or other obligations of a like nature (other than for borrowed money), in each case incurred in the ordinary course of business, (v) easements, rights-of-way, restrictions, minor defects or irregularities in title and other similar charges or encumbrances incurred in the ordinary course of business not interfering in any material respect with the business of the Company or its Subsidiaries, (vi) Liens upon specific items of inventory or other goods and proceeds of any Person securing such Person's obligations in respect of letters of credit or bankers' acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods in the ordinary course of business, (vii) judgment and attachment Liens not giving rise to an Event of Default, (viii) leases or subleases granted to others in the ordinary course of business consistent with past practice not interfering in any material respect with the business of the Company or its Subsidiaries, (ix) any interest or title of a lessor in the property subject to any lease, whether characterized as capitalized or operating other than any such interest or title resulting from or arising out of a default by the Company or its Subsidiaries of its obligations under such lease and (x) Liens arising from filing UCC financing statements for precautionary purposes in connection with true leases of personal property that are otherwise permitted under this Indenture and under which the Company or any of its Subsidiaries is a lessee. "Person" means an individual, partnership, corporation, limited liability company, unincorporated organization, trust or joint venture, or a governmental agency or political subdivision thereof. "Physical Securities" has the meaning provided in Section 2.02. "Preferred Stock" of any Person means any Capital Stock of such Person that has preferential rights to any other Capital Stock of such Person with respect to dividends or 22 23 redemptions or upon liquidation. "principal" of any Indebtedness (including the Securities) means the principal amount of such Indebtedness plus the premium, if any, on such Indebtedness. "Proceeds Purchase Date" shall have the meaning provided in Section 4.16. "Productive Assets" means assets of a kind used or usable by the Company and its Subsidiaries in broadcast businesses or businesses reasonably related thereto, and specifically includes assets acquired through Asset Acquisitions. "Public Equity Offering" means an underwritten public offering of Capital Stock (other than Disqualified Capital Stock) of the Company or Holdings, pursuant to an effective registration statement filed with the Commission in accordance with the Securities Act; provided, however, that, in the case of a Public Equity Offering by Holdings, Holdings contributes to the capital of the Company net cash proceeds in an amount at least sufficient to redeem the Securities called for redemption in accordance with the terms thereof. "Purchase Agreement" means the Purchase Agreement dated as of June 18, 1997 by and among the Company, the Guarantors and the Initial Purchasers relating to the purchase of $200.0 million aggregate principal amount of Securities. "Qualified Capital Stock" means any Capital Stock that is not Disqualified Capital Stock. "Qualified Institutional Buyer" or "QIB" shall have the meaning specified in Rule 144A under the Securities Act. "Redemption Date" means, with respect to any Securities, the Maturity Date of such Security or the earlier date on which such Security is to be redeemed by the Company pursuant to the terms of the Securities. "Redemption Price" shall have the meaning provided in Section 3.03. "Refinancing Indebtedness" means any refinancing by the Company of Indebtedness of the Company or any of its Subsidiaries incurred in accordance with Section 4.12 (other than pursuant to clause (iii) or (iv) of the definition of Permitted Indebtedness) that does not (i) result in an increase in the aggregate principal amount of Indebtedness (such principal amount to include, for purposes of this definition, any premiums, penalties or accrued interest paid with the proceeds of 23 24 the Refinancing Indebtedness) of such Person or (ii) create Indebtedness with (A) a Weighted Average Life to Maturity that is less than the Weighted Average Life to Maturity of the Indebtedness being refinanced or (B) a final maturity earlier than the final maturity of the Indebtedness being refinanced. "Registered Exchange Offer" means the consummation of the offer to exchange the Series B Securities for all of the outstanding Series A Securities in accordance with the Registration Rights Agreement. "Registrar" has the meaning provided in Section 2.03. "Registration Rights Agreement" means the Registration Rights Agreement by and among the Company, the Guarantors and the Initial Purchasers, relating to $200.0 million aggregate principal amount of Securities and dated the Issue Date, as the same may be amended, supplemented or otherwise modified from time to time in accordance with the terms thereof. "Regulation S" means Regulation S under the Securities Act. "Representative" means the indenture trustee or other trustee, agent or representative in respect of any Designated Senior Indebtedness; provided that if, and for so long as, any Designated Senior Indebtedness lacks such a representative, then the Representative for such Designated Senior Indebtedness shall at all times constitute the holders of a majority in outstanding principal amount of such Designated Senior Indebtedness. "Restricted Payment" has the meaning provided in Section 4.03. "Restricted Security" means a Security that is a "Restricted Security" as defined in Rule 144A(a)(3) under the Securities Act; provided, however, that the Trustee shall be entitled to request and conclusively rely on an Opinion of Counsel with respect to whether any Security constitutes a Restricted Security. "Rule 144A" means Rule 144A under the Securities Act. "Sale and Leaseback Transaction" means any direct or indirect arrangement with any Person or to which any such Person is a party, providing for the leasing to the Company or a Subsidiary of any property, whether owned by the Company or any Subsidiary at the Issue Date or later acquired, which has been or is to be sold or transferred by the Company or such Subsidiary to such Person or to any other Person from whom funds have been or are to be advanced by such Person on the security of 24 25 such property. "SEC" means the Securities and Exchange Commission. "Securities" means the Series A Securities and Series B Securities, as amended or supplemented from time to time in accordance with the terms hereof, that are issued pursuant to this Indenture. "Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder. "Senior Indebtedness" means any Indebtedness of the Company (including any interest accruing subsequent to the filing of a petition of bankruptcy at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable law), whether outstanding on the Issue Date or thereafter created, incurred or assumed, unless, in the case of any particular Indebtedness, the instrument creating or evidencing the same or pursuant to which the same is outstanding expressly provides that such Indebtedness shall not be senior in right of payment to the Securities. Without limiting the generality of the foregoing, "Senior Indebtedness" shall also include the principal of, premium, if any, interest (including any interest accruing subsequent to the filing of a petition of bankruptcy at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable law) on, and all other amounts owing in respect of, and all monetary obligations of every nature under, (x) the Credit Agreement, including, without limitation, obligations to pay principal and interest, reimbursement obligations under letters of credit, fees, expenses and indemnities and (y) all Interest Swap Obligations. Notwithstanding the foregoing, Senior Indebtedness shall not include any of the following amounts (whether or not constituting Indebtedness as defined in this Indenture): (i) any Indebtedness of the Company to a Subsidiary of the Company; (ii) Indebtedness and other amounts owing to trade creditors incurred in connection with obtaining goods, materials or services; (iii) Indebtedness represented by Disqualified Capital Stock; (iv) any liability for federal, state, local or other taxes owed or owing by the Company; and (v) any Indebtedness which is, by its express terms, subordinated in right of payment to any other Indebtedness of the Company, including the 1996 Notes, the 12 1/4% Subordinated Exchange Debentures due 2008 of the Company and the 12% Subordinated Exchange Debentures due 2009 of the Company. "Series A Securities" means the 8 3/4% Senior Subordinated Notes due 2007, Series A, issued, authenticated and delivered under this Indenture, as amended or supplemented from 25 26 time to time pursuant to the terms of this Indenture. "Series B Securities" means the 8 3/4% Senior Subordinated Notes due 2007, Series B (the terms of which are identical to the Series A Securities except that, unless any Series B Securities shall be issued as Private Exchange Securities (as defined in the Registration Rights Agreement), the Series B Securities shall be registered under the Securities Act, and shall not contain the respective legend on the face of the from of the Series A Securities), to be issued in exchange for the Series A Securities pursuant to the Registered Exchange Offer and this Indenture or the Private Exchange (as defined in the Registration Rights Agreement). "Significant Subsidiary" means for any Person each Subsidiary of such Person which (i) for the most recent fiscal year of such Person accounted for more than 5% of the consolidated net income of such Person or (ii) as at the end of such fiscal year, was the owner of more than 5% of the consolidated assets of such Person. "Subsidiary," with respect to any Person, means (i) any corporation of which the outstanding Capital Stock having at least a majority of the votes entitled to be cast in the election of directors under ordinary circumstances shall at the time be owned, directly or indirectly, by such Person or (ii) any other Person of which at least a majority of the voting interest under ordinary circumstances is at the time, directly or indirectly, owned by such Person. Notwithstanding anything in this Indenture to the contrary, all references to the Company and its consolidated Subsidiaries or to financial information prepared on a consolidated basis in accordance with GAAP shall be deemed to include the Company and its Subsidiaries as to which financial statements are prepared on a combined basis in accordance with GAAP and to financial information prepared on such a combined basis. Notwithstanding anything in this Indenture to the contrary, an Unrestricted Subsidiary shall not be deemed to be a Subsidiary for purposes of this Indenture. "Tax Sharing Agreement" means the Tax Sharing Agreement between the Company and Holdings as in effect on the 1996 Notes Issue Date. "TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb), as amended, as in effect on the date on which this Indenture is qualified under the TIA, except as otherwise provided in Section 9.03. "Trustee" means the party named as such in this Indenture until a successor replaces it in accordance with the provisions of this Indenture and thereafter means such 26 27 successor. "Trust Officer" means any officer or assistant officer of the Trustee assigned by the Trustee to administer its corporate trust matters or, in the case of a successor trustee, an officer assigned to the department, division or group performing the corporate trust work of such successor. "Unrestricted Subsidiary" means a Subsidiary of the Company created after the 1996 Notes Issue Date and so designated by a resolution adopted by the Board of Directors of the Company, provided that (a) neither the Company nor any of its other Subsidiaries (other than Unrestricted Subsidiaries) (1) provides any credit support for any Indebtedness of such Subsidiary (including any undertaking, agreement or instrument evidencing such Indebtedness) or (2) is directly or indirectly liable for any Indebtedness of such Subsidiary, (b) the creditors with respect to Indebtedness for borrowed money of such Subsidiary, having a principal amount in excess of $5,000,000, have agreed in writing that they have no recourse, direct or indirect, to the Company or any other Subsidiary of the Company (other than Unrestricted Subsidiaries), including, without limitation, recourse with respect to the payment of principal of or interest on any Indebtedness of such Subsidiary and (c) at the time of designation of such Subsidiary such Subsidiary has no property or assets (other than de minimis assets resulting from the initial capitalization of such Subsidiary). Any such designation by the Board of Directors of the Company shall be evidenced to the Trustee by the filing with the Trustee of a certified copy of the resolution of the Company's Board of Directors giving effect to such designation and an Officers' Certificate certifying that such designation complied with the foregoing conditions. "U.S. Government Obligations" has the meaning provided in Section 8.01. "U.S. Legal Tender" means such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts. "U.S. Physical Securities" has the meaning provided in Section 2.02. "Weighted Average Life to Maturity" means, when applied to any Indebtedness at any date, the number of years obtained by dividing (a) the then outstanding aggregate principal amount of such Indebtedness into (b) the total of the product obtained by multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal, including payment at final maturity, in respect thereof, by (ii) the number of years 27 28 (calculated to the nearest one-twelfth) which will elapse between such date and the making of such payment. "Wholly Owned Subsidiary" of any Person means any Subsidiary of such Person of which all the outstanding voting securities (other than directors' qualifying shares) which normally have the right to vote in the election of directors are owned by such Person or any Wholly Owned Subsidiary of such Person. B. Incorporation by Reference of TIA. Whenever this Indenture refers to a provision of the TIA, such provision is incorporated by reference in, and made a part of, this Indenture. The following TIA terms used in this Indenture have the following meanings: "Commission" means the SEC. "indenture securities" means the Securities. "indenture security holder" means a Holder or a Securityholder. "indenture to be qualified" means this Indenture. "indenture trustee" or "institutional trustee" means the Trustee. "obligor" on the indenture securities means the Company or any other obligor on the Securities. All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule and not otherwise defined herein have the meanings assigned to them therein. C. Rules of Construction. Unless the context otherwise requires: (1) a term has the meaning assigned to it; (2) an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP as in effect on the 1996 Notes Issue Date; (3) "or" is not exclusive; (4) words in the singular include the plural, and words in the plural include the singular; and 28 29 (5) "herein," "hereof" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision. II. THE SECURITIES A. Form and Dating. The Series A Securities and the Series B Securities and the Trustee's certificate of authentication shall be substantially in the form of Exhibits A- 1 and A-2 annexed hereto, as applicable. The Securities may have notations, legends or endorsements required by law, stock exchange rule or usage (and, in the case of Series B Securities that are Private Exchange Notes, legends restricting the transfer thereof similar to the legend on the Series A Securities). The Company shall approve the form of the Securities and any notation, legend or endorsement thereon. Each Security shall be dated the date of its authentication. The terms and provisions contained in the Securities shall constitute, and are hereby expressly made, a part of this Indenture and, to the extent applicable, the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. B. Execution and Authentication. Two Officers, or an Officer and an Assistant Secretary, shall sign, or one Officer shall sign and one Officer or an Assistant Secretary (each of whom shall, in each case, have been duly authorized by all requisite corporate actions) shall attest to, the Securities for the Company by manual or facsimile signature. Each Guarantor shall execute a Guarantee in the manner set forth in Section 10A.02. If an Officer, Secretary or Assistant Secretary whose signature is on a Security was an Officer or Assistant Secretary at the time of such execution but no longer holds that office or position at the time the Trustee authenticates the Security, the Security shall nevertheless be valid. A Security shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Security. The signature shall be conclusive evidence that the Security has been authenticated under this Indenture. 29 30 The Trustee shall authenticate Series A Securities for original issue in the aggregate principal amount of up to $200,000,000 upon receipt of a written order of the Company in the form of an Officers' Certificate. In addition, on or prior to the date of the Registered Exchange Offer, the Trustee or an authenticating agent shall authenticate Series B Securities to be issued at the time of the Registered Exchange Offer in the aggregate principal amount of up to $200,000,000 upon receipt of an Officers Certificate of the Company. In each case, such Officers' Certificate shall specify the amount of Securities to be authenticated and the date on which the Securities are to be authenticated. The aggregate principal amount of Securities outstanding at any time may not exceed $200,000,000 except as provided in Section 2.07. Upon the written order of the Company in the form of an Officers' Certificate, the Trustee shall authenticate Securities in substitution of Securities originally issued to reflect any name change of the Company. The Trustee may appoint an authenticating agent reasonably acceptable to the Company to authenticate Securities. Unless otherwise provided in the appointment, an authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with the Company and Affiliates of the Company. The Securities shall be issuable in fully registered form only, without coupons, in denominations of $1,000 and any integral multiple thereof. Securities offered and sold in reliance on Rule 144A shall be issued initially in the form of one or more permanent Global Securities in registered form, substantially in the form set forth in Exhibit A-1 ("Global Securities"), deposited with the Trustee, as custodian for the Depository, and shall bear the legend set forth on Exhibit B. The aggregate principal amount of any Global Security may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for the Depository, as hereinafter provided. Securities offered and sold in offshore transactions in reliance on Regulation S shall be issued in the form of certificated Securities in registered form, substantially in the form set forth in Exhibit A-1 (the "Offshore Physical Securities"). Securities offered and sold in reliance on any other exemption from registration under the Securities Act other than as described in the preceding paragraph shall be issued in the form of certificated Securities in registered form in substantially the form set forth in Exhibit A-1 (the "U.S. Physical Securities"). The Offshore Physical Securities and the U.S. 30 31 Physical Securities are sometimes collectively herein referred to as the "Physical Securities." Physical Securities shall initially be registered in the name of the Depository or the nominee of such Depository and be delivered to the Trustee as custodian for such Depository. Beneficial owners of Physical Securities, however, may request registration of such Physical Securities in their names or the names of their nominees. Series B Securities may also be issued in the form of Global Securities, and if so issued, will be treated as Global Securities under this Indenture. C. Registrar and Paying Agent. The Company shall maintain an office or agency (which shall be located in the Borough of Manhattan in the City of New York, State of New York), where (a) Securities may be presented or surrendered for registration of transfer or for exchange ("Registrar"), (b) Securities may be presented or surrendered for payment ("Paying Agent") and (c) notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. The Registrar shall keep a register of the Securities and of their transfer and exchange. The Company, upon notice to the Trustee, may have one or more co-Registrars and one or more additional paying agents reasonably acceptable to the Trustee. The term "Paying Agent" includes any additional paying agent. Neither the Company nor any Affiliate of the Company may act as Paying Agent. The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture, which agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall notify the Trustee, in advance, of the name and address of any such Agent. If the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act as such. The Company initially appoints the Trustee as Registrar and Paying Agent until such time as the Trustee has resigned or a successor has been appointed. D. Paying Agent To Hold Assets in Trust. The Company shall require each Paying Agent other than the Trustee to agree in writing that each Paying Agent shall hold in trust for the benefit of the Holders or the Trustee all assets held by the Paying Agent for the payment of principal of, or interest on, the Securities (whether such assets have been distributed to it by the Company or any other obligor on the Securities), and shall notify the Trustee of any default by the Company (or any other obligor on the Securities) in making any such payment. The Company at any time may 31 32 require a Paying Agent to distribute all assets held by it to the Trustee and account for any assets disbursed and the Trustee may at any time during the continuance of any payment Default, upon written request to a Paying Agent, require such Paying Agent to distribute all assets held by it to the Trustee and to account for any assets distributed. Upon distribution to the Trustee of all assets that shall have been delivered by the Company to the Paying Agent and the completion of any accounting required to be made hereunder, the Paying Agent shall have no further liability for such assets. E. Securityholder Lists. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of the Holders. If the Trustee is not the Registrar, the Company shall furnish to the Trustee five (5) Business Days before each Interest Payment Date and at such other times as the Trustee may request in writing a list as of the applicable Record Date and in such form as the Trustee may reasonably require of the names and addresses of the Holders, which list may be conclusively relied upon by the Trustee. F. Transfer and Exchange. Subject to the provisions of Section 2.15 and Section 2.16, when Securities are presented to the Registrar or a co-Registrar with a request to register the transfer of such Securities or to exchange such Securities for an equal principal amount of Securities of other authorized denominations, the Registrar or co-Registrar shall register the transfer or make the exchange as requested if its requirements for such transaction are met; provided, however, that the Securities surrendered for transfer or exchange shall be duly endorsed or accompanied by a written instrument of transfer in form satisfactory to the Company and the Registrar or co-Registrar, duly executed by the Holder thereof or his attorney duly authorized in writing. To permit registrations of transfers and exchanges, the Company shall execute and the Trustee shall authenticate Securities at the Registrar's or co-Registrar's request. No service charge shall be made for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith. The Registrar or co-Registrar shall not be required to register the transfer of or exchange of any Security (i) during a period beginning at the opening of business 15 days before the mailing of a notice of redemption of Securities and ending at the close of business on the day of such mailing and (ii) selected for redemption in whole or in part pursuant to Article Three, except the unredeemed portion of any Security being redeemed in part. 32 33 Any Holder of the Global Security shall, by acceptance of such Global Security, agree that transfers of beneficial interests in such Global Security may be effected only through a book-entry system maintained by the Holder of such Global Security (or its agent), and that ownership of a beneficial interest in the Security shall be required to be reflected in a book entry. G. Replacement Securities. If a mutilated Security is surrendered to the Trustee or if the Holder of a Security claims that the Security has been lost, destroyed or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Security if the Trustee's requirements are met. If required by the Trustee or the Company, such Holder must provide an indemnity bond or other indemnity, sufficient in the judgment of the Company and the Trustee, to protect the Company, the Trustee or any Agent from any loss which any of them may suffer if a Security is replaced. The Company may charge such Holder for its reasonable, out-of-pocket expenses in replacing a Security, including reasonable fees and expenses of counsel. Every replacement Security shall constitute an additional obligation of the Company. H. Outstanding Securities. Securities outstanding at any time are all the Securities that have been authenticated by the Trustee except those cancelled by it, those delivered to it for cancellation and those described in this Section as not outstanding. A Security does not cease to be outstanding because the Company or any of its Affiliates holds the Security. If a Security is replaced pursuant to Section 2.07 (other than a mutilated Security surrendered for replacement), it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Security is held by a bona fide purchaser. A mutilated Security ceases to be outstanding upon surrender of such Security and replacement thereof pursuant to Section 2.07. If on a Redemption Date or the Maturity Date the Paying Agent holds U.S. Legal Tender or U.S. Government Obligations sufficient to pay all of the principal and interest due on the Securities payable on that date and is not prohibited from paying such money to the Holders thereof pursuant to the terms of this Indenture, then on and after that date such Securities cease to be outstanding and interest on them ceases to accrue. 33 34 I. Treasury Securities. In determining whether the Holders of the required principal amount of Securities have concurred in any direction, waiver, consent or notice, Securities owned by the Company or an Affiliate shall be considered as though they are not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Securities which the Trustee knows are so owned shall be so considered. The Company shall notify the Trustee, in writing, when it or any of its Affiliates repurchases or otherwise acquires Securities, of the aggregate principal amount of such Securities so repurchased or otherwise acquired. J. Temporary Securities. Until definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities upon receipt of a written order of the Company in the form of an Officers' Certificate. The Officers' Certificate shall specify the amount of temporary Securities to be authenticated and the date on which the temporary Securities are to be authenticated. Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company considers appropriate for temporary Securities. Without unreasonable delay, the Company shall prepare and execute, and the Trustee shall authenticate upon receipt of a written order of the Company pursuant to Section 2.02, definitive Securities in exchange for temporary Securities. K. Cancellation. The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for transfer, exchange or payment. The Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent, and no one else, shall cancel and, at the written direction of the Company, shall dispose of all Securities surrendered for transfer, exchange, payment or cancellation. Subject to Section 2.07, the Company may not issue new Securities to replace Securities that the Company has paid or delivered to the Trustee for cancellation. If the Company shall acquire any of the Securities, such acquisition shall not operate as a redemption or satisfaction of the Indebtedness represented by such Securities unless and until the same are surrendered to the Trustee for cancellation pursuant to this Section 2.11. L. Defaulted Interest. If the Company defaults in a payment of interest on the Securities, it shall pay the defaulted interest, plus (to 34 35 the extent lawful) any interest payable on the defaulted interest to the Persons who are Holders on a subsequent special record date, which date shall be the fifteenth day next preceding the date fixed by the Company for the payment of defaulted interest or the next succeeding Business Day if such date is not a Business Day. At least 15 days before the subsequent special record date, the Company shall mail to each Holder, with a copy to the Trustee, a notice that states the subsequent special record date, the payment date and the amount of defaulted interest, and interest payable on such defaulted interest, if any, to be paid. M. CUSIP Number. The Company in issuing the Securities may use a "CUSIP" number, and if so, the Trustee shall use the CUSIP number in notices of redemption or exchange as a convenience to Holders; provided that no representation is hereby deemed to be made by the Trustee as to the correctness or accuracy of the CUSIP number printed in the notice or on the Securities, and that reliance may be placed only on the other identification numbers printed on the Securities. N. Deposit of Moneys. Prior to 11:00 a.m. New York City time on each Interest Payment Date and Maturity Date, the Company shall have deposited with the Paying Agent in immediately available funds money sufficient to make cash payments, if any, due on such Interest Payment Date or Maturity Date, as the case may be, in a timely manner which permits the Paying Agent to remit payment to the Holders on such Interest Payment Date or Maturity Date, as the case may be. O. Book-Entry Provisions for Global Securities. (a) The Global Securities initially shall (i) be registered in the name of the Depository or the nominee of such Depository, (ii) be delivered to the Trustee as custodian for such Depository and (iii) bear legends as set forth in Exhibit B. Members of, or participants in, the Depository ("Agent Members") shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depository, or the Trustee as its custodian, or under the Global Security, and the Depository may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of the Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or 35 36 the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depository or impair, as between the Depository and its Agent Members, the operation of customary practices governing the exercise of the rights of a Holder of any Security. (b) Transfers of Global Securities shall be limited to transfers in whole, but not in part, to the Depository, its successors or their respective nominees. Interests of beneficial owners in the Global Securities may be transferred or exchanged for Physical Securities in accordance with the rules and procedures of the Depository and the provisions of Section 2.16. In addition, Physical Securities shall be transferred to all beneficial owners in exchange for their beneficial interests in Global Securities if (i) the Depository notifies the Company that it is unwilling or unable to continue as Depository for any Global Security and a successor depository is not appointed by the Company within 90 days of such notice or (ii) an Event of Default has occurred and is continuing and the Registrar has received a request from the Depository to issue Physical Securities. (c) In connection with any transfer or exchange of a portion of the beneficial interest in any Global Security to beneficial owners pursuant to paragraph (b), the Registrar shall (if one or more Physical Securities are to be issued) reflect on its books and records the date and a decrease in the principal amount of the Global Security in an amount equal to the principal amount of the beneficial interest in the Global Security to be transferred, and the Company shall execute, and the Trustee shall authenticate and deliver, one or more Physical Securities of like tenor and amount. (d) In connection with the transfer of Global Securities as an entirety to beneficial owners pursuant to paragraph (b), the Global Securities shall be deemed to be surrendered to the Trustee for cancellation, and the Company shall execute, and the Trustee shall authenticate and deliver to each beneficial owner identified by the Depository in exchange for its beneficial interest in the Global Securities, an equal aggregate principal amount of Physical Securities of authorized denominations. (e) Any Physical Security constituting a Restricted Security delivered in exchange for an interest in a Global Security pursuant to paragraph (b) or (c) shall, except as otherwise provided by paragraphs (a)(i)(x) and (c) of Section 2.16, bear the legend regarding transfer restrictions applicable to the Physical Securities set forth in Exhibit A-1. (f) The Holder of any Global Security may grant proxies and otherwise authorize any person, including Agent 36 37 Members and persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities. P. Special Transfer Provisions. (a) Transfers to Non-QIB Institutional Accredited Investors and Non-U.S. Persons. The following provisions shall apply with respect to the registration of any proposed transfer of a Security constituting a Restricted Security to any Institutional Accredited Investor which is not a QIB or to any Non-U.S. Person: (a) the Registrar shall register the transfer of any Security constituting a Restricted Security, whether or not such Security bears the Private Placement Legend, if (x) the requested transfer is after June 24, 1999, provided, however, that neither the Company nor any Affiliate of the Company has held any beneficial interest in such Security, or portion thereof, at any time on or prior to June 24, 1999, or (y) (1) in the case of a transfer to an Institutional Accredited Investor which is not a QIB (excluding Non-U.S. Persons), the proposed transferee has delivered to the Registrar a certificate substantially in the form of Exhibit C hereto or (2) in the case of a transfer to a Non-U.S. Person, the proposed transferee has delivered to the Registrar a certificate substantially in the form of Exhibit D hereto; and (b) if the proposed transferor is an Agent Member holding a beneficial interest in a Global Security, upon receipt by the Registrar of (x) the certificate, if any, required by paragraph (i) above and (y) written instructions given in accordance with the Depository's and the Registrar's procedures, whereupon (a) the Registrar shall reflect on its books and records the date and (if the transfer does not involve a transfer of outstanding Physical Securities) a decrease in the principal amount of a Global Security in an amount equal to the principal amount of the beneficial interest in a Global Security to be transferred, and (b) the Company shall execute and the Trustee shall authenticate and deliver one or more Physical Securities of like tenor and amount. (b) Transfers to QIBs. The following provisions shall apply with respect to the registration of any proposed transfer of a Security constituting a Restricted Security to a QIB (excluding transfers to Non-U.S. Persons): (a) the Registrar shall register the transfer if such transfer is being made by a proposed transferor who 37 38 has checked the box provided for on the form of Security stating, or has otherwise advised the Company and the Registrar in writing, that the sale has been made in compliance with the provisions of Rule 144A to a transferee who has signed the certification provided for on the form of Security stating, or has otherwise advised the Company and the Registrar in writing, that it is purchasing the Security for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a QIB within the meaning of Rule 144A, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as it has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A; and (b) if the proposed transferee is an Agent Member, and the Securities to be transferred consist of Physical Securities which after transfer are to be evidenced by an interest in the Global Security, upon receipt by the Registrar of instructions given in accordance with the Depository's and the Registrar's procedures, the Registrar shall reflect on its books and records the date and an increase in the principal amount of the Global Security in an amount equal to the principal amount of the Physical Securities to be transferred, and the Trustee shall cancel the Physical Securities so transferred. (c) Private Placement Legend. Upon the transfer, exchange or replacement of Securities not bearing the Private Placement Legend, the Registrar shall deliver Securities that do not bear the Private Placement Legend. Upon the transfer, exchange or replacement of Securities bearing the Private Placement Legend, the Registrar shall deliver only Securities that bear the Private Placement Legend unless (i) the circumstances contemplated by paragraph (a)(i)(x) of this Section 2.16 exist, (ii) there is delivered to the Registrar an Opinion of Counsel reasonably satisfactory to the Company and the Trustee to the effect that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act or (iii) such Security has been sold pursuant to an effective registration statement under the Securities Act. (d) General. By its acceptance of any Security bearing the Private Placement Legend, each Holder of such a Security acknowledges the restrictions on transfer of such Security set forth in this Indenture and in the Private Placement Legend and agrees that it will transfer such Security only 38 39 as provided in this Indenture. The Registrar shall retain copies of all letters, notices and other written communications received pursuant to Section 2.15 or this Section 2.16. The Company shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable written notice to the Registrar. III. REDEMPTION A. Notices to Trustee. If the Company elects to redeem Securities pursuant to paragraph 6 of the Securities, it shall notify the Trustee and the Paying Agent in writing of the Redemption Date and the principal amount of the Securities to be redeemed and whether it wants the Trustee to give notice of redemption to the Holders (at the Company's expense) at least 60 days (unless a shorter notice shall be satisfactory to the Trustee) but not more than 90 days before the Redemption Date. Any such notice may be cancelled at any time prior to notice of such redemption being mailed to any Holder and shall thereby be void and of no effect. B. Selection of Securities To Be Redeemed. If fewer than all of the Securities are to be redeemed, the Trustee shall select the Securities to be redeemed in compliance with the requirements of the principal national securities exchange, if any, on which the Securities being redeemed are listed, or, if the Securities are not listed on a national securities exchange, on a pro rata basis, by lot or in such other fair and reasonable manner chosen at the discretion of the Trustee; provided, however, that a redemption pursuant to the provisions of paragraph 6(b) of the Securities shall be made on a pro rata basis. The Trustee shall make the selection from the Securities outstanding and not previously called for redemption and shall promptly notify the Company in writing of the Securities selected for redemption and, in the case of any Security selected for partial redemption, the principal amount thereof to be redeemed. Securities in denominations of $1,000 or less may be redeemed only in whole. The Trustee may select for redemption portions (equal to $1,000 or any integral multiple thereof) of the principal of Securities that have denominations larger than $1,000. Provisions of this Indenture that apply to 39 40 Securities called for redemption also apply to portions of Securities called for redemption. C. Notice of Redemption. At least 30 days but not more than 60 days before a Redemption Date, the Company shall mail or cause to be mailed a notice of redemption by first-class mail to each Holder whose Securities are to be redeemed, with a copy to the Trustee. At the Company's request, the Trustee shall give the notice of redemption in the Company's name and at the Company's expense. Each notice for redemption shall identify the Securities to be redeemed and shall state: (1) the Redemption Date; (2) the redemption price and the amount of accrued interest, if any, to be paid (the "Redemption Price"); (3) the paragraph of the Securities pursuant to which the Securities are being redeemed; (4) the name and address of the Paying Agent; (5) that Securities called for redemption must be surrendered to the Paying Agent to collect the Redemption Price; (6) that, unless the Company defaults in making the redemption payment, interest on Securities called for redemption ceases to accrue on and after the Redemption Date, and the only remaining right of the Holders of such Securities is to receive payment of the Redemption Price upon surrender to the Paying Agent of the Securities redeemed; (7) if any Security is being redeemed in part, the portion of the principal amount of such Security to be redeemed and that, after the Redemption Date, and upon surrender of such Security, a new Security or Securities in the aggregate principal amount equal to the unredeemed portion thereof will be issued; and (8) if fewer than all the Securities are to be redeemed, the identification of the particular Securities (or portion thereof) to be redeemed, as well as the aggregate principal amount of Securities to be redeemed and the aggregate principal amount of Securities to be outstanding after such partial redemption. 40 41 D. Effect of Notice of Redemption. Once notice of redemption is mailed in accordance with Section 3.03, Securities called for redemption become due and payable on the Redemption Date and at the Redemption Price. Upon surrender to the Trustee or Paying Agent, such Securities called for redemption shall be paid at the Redemption Price. E. Deposit of Redemption Price. On or before the Redemption Date, the Company shall deposit with the Paying Agent U.S. Legal Tender sufficient to pay the Redemption Price of all Securities to be redeemed on that date. The Paying Agent shall promptly return to the Company any U.S. Legal Tender so deposited which is not required for that purpose, except with respect to monies owed as obligations to the Trustee pursuant to Article Seven. If the Company complies with the preceding paragraph, then, unless the Company defaults in the payment of such Redemption Price, interest on the Securities to be redeemed will cease to accrue on and after the applicable Redemption Date, whether or not such Securities are presented for payment. F. Securities Redeemed in Part. Upon surrender of a Security that is to be redeemed in part, the Trustee shall authenticate for the Holder a new Security or Securities equal in principal amount to the unredeemed portion of the Security surrendered. IV. COVENANTS A. Payment of Securities. The Company shall pay the principal of and interest on the Securities on the dates and in the manner provided in the Securities. An installment of principal of or interest on the Securities shall be considered paid on the date it is due if the Trustee or Paying Agent holds on that date U.S. Legal Tender designated for and sufficient to pay the installment. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months. Notwithstanding anything to the contrary contained in this Indenture, the Company may, to the extent it is required to do so by law, deduct or withhold income or other similar taxes imposed by the United States of America from principal or interest payments hereunder. 41 42 B. Maintenance of Office or Agency. The Company shall maintain the office or agency required under Section 2.03. The Company shall give prior notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the address of the Trustee set forth in Section 11.02. C. Limitation on Restricted Payments. Neither the Company nor any of its Subsidiaries will, directly or indirectly, (a) declare or pay any dividend or make any distribution (other than dividends or distributions payable in Qualified Capital Stock of the Company) on shares of the Company's Capital Stock, (b) purchase, redeem or otherwise acquire or retire for value any Capital Stock of the Company or any warrants, rights or options to acquire shares of any class of such Capital Stock, other than the exchange of such Capital Stock or any warrants, rights or options to acquire shares of any class of such Capital Stock for Qualified Capital Stock or warrants, rights or options to acquire Qualified Capital Stock, (c) make any principal payment on, purchase, defease, redeem, prepay, decrease or otherwise acquire or retire for value, prior to any scheduled final maturity, scheduled repayment or scheduled sinking fund payment, any Indebtedness of the Company or its Subsidiaries that is subordinate or junior in right of payment to the Securities or (d) make any Investment (other than Permitted Investments) (each of the foregoing prohibited actions set forth in clauses (a), (b), (c) and (d) being referred to as a "Restricted Payment"), if at the time of such Restricted Payment or immediately after giving effect thereto, (i) a Default or an Event of Default has occurred and is continuing, (ii) the Company is not able to incur at least $1.00 of additional Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.12, or (iii) the aggregate amount of Restricted Payments made subsequent to the 1996 Notes Issue Date (the amount expended for such purposes, if other than in cash, being the fair market value of such property as determined by the Board of Directors of the Company in good faith) exceeds the sum of: a) (A)(x) 100% of the aggregate Consolidated EBITDA of the Company (or, in the event such Consolidated EBITDA shall be a deficit, minus 100% of such deficit) accrued subsequent to the 1996 Notes Issue Date to the most recent date for which financial information is available to the Company, taken as one accounting period; less 42 43 (y) 1.4 times Consolidated Interest Expense for the same period; plus (B) 100% of the aggregate net proceeds, including the fair market value of property other than cash as determined by the Board of Directors of the Company in good faith, received by the Company from any Person (other than a Subsidiary of the Company) from the issuance and sale on or after the 1996 Notes Issue Date of Qualified Capital Stock of the Company (excluding any net proceeds from issuances and sales financed directly or indirectly using funds borrowed from the Company or any Subsidiary of the Company, until and to the extent such borrowing is repaid, but including the proceeds from the issuance and sale of any securities convertible into or exchangeable for Qualified Capital Stock to the extent such securities are so converted or exchanged and including any additional proceeds received by the Company upon such conversion or exchange) plus (C) without duplication of any amounts included in clause (iii)(B) above, 100% of the aggregate net proceeds, including the fair market value of property other than cash (valued as provided in clause (iii)(B) above), received by the Company as a capital contribution (excluding any net proceeds from a Public Equity Offering by Holdings to the extent used to redeem the Securities) on or after to the 1996 Notes Issue Date. Notwithstanding the foregoing, the provisions of this Section 4.03 shall not prohibit: (1) the payment of any dividend or the making of any distribution within 60 days after the date of its declaration if the dividend or distribution would have been permitted on the date of declaration; (2) the acquisition of Capital Stock or warrants, options or other rights to acquire Capital Stock either (i) solely in exchange for shares of Qualified Capital Stock or warrants, options or other rights to acquire Qualified Capital Stock, or (ii) through the application of the net proceeds of a substantially concurrent sale for cash (other than to a Subsidiary of the Company) of shares of Qualified Capital Stock or warrants, options or other rights to acquire Qualified Capital Stock; (3) the acquisition of Indebtedness of the Company that is subordinate or junior in right of payment to the Securities, either (i) solely in exchange for shares of Qualified Capital Stock (or warrants, options or other rights to acquire Qualified Capital Stock) or for Indebt- 43 44 edness of the Company which is subordinate or junior in right of payment to the Securities, at least to the extent that the Indebtedness being acquired is subordinated to the Securities and has a Weighted Average Life to Maturity no less than that of the Indebtedness being acquired or (ii) through the application of the net proceeds of a substantially concurrent sale for cash (other than to a Subsidiary of the Company) of shares of Qualified Capital Stock (or warrants, options or other rights to acquire Qualified Capital Stock) or Indebtedness of the Company which is subordinate or junior in right of payment to the Securities, at least to the extent that the Indebtedness being acquired is subordinated to the Securities and has a Weighted Average Life to Maturity no less than that of the Indebtedness being refinanced; (4) payments by the Company to fund the operating expenses of Holdings in an amount not to exceed $500,000 per annum; (5) payments by the Company to Holdings to enable Holdings to make payments pursuant to (a) the Financial Monitoring and Oversight Agreements or (b) the Tax Sharing Agreement; (6) payments by the Company to repurchase, or to enable Holdings to repurchase, Capital Stock or other securities of Holdings from employees of Holdings or the Company in an aggregate amount not to exceed $5,000,000 subsequent to the 1996 Notes Issue Date; (7) payments to enable Holdings to redeem or repurchase stock purchase or similar rights in an aggregate amount not to exceed $500,000 subsequent to the 1996 Notes Issue Date; (8) payments, not to exceed $100,000 in the aggregate subsequent to the 1996 Notes Issue Date, to enable Holdings to make cash payments to holders of its Capital Stock in lieu of the issuance of fractional shares of its Capital Stock; and (9) payments made pursuant to any merger, consolidation or sale of assets effected in accordance with Section 5.01; provided, however, that no such payment may be made pursuant to this clause (9) unless, after giving effect to such transaction (and the incurrence of any Indebtedness in connection therewith and the use of the proceeds thereof), the Company would be able to incur $1.00 of additional Indebtedness (other than Permitted Indebtedness) pursuant to Section 4.12 such that after incurring that $1.00 of additional Indebtedness, the 44 45 Leverage Ratio would be less than 5.5 to 1; provided, however, that in the case of clauses 5(a), (6), (7), (8) and (9), no Default or Event of Default shall have occurred or be continuing at the time of such payment or as a result thereof. In determining the aggregate amount of Restricted Payments made subsequent to the Issue Date, amounts expended pursuant to clauses (1), (2), (3) (but only to the extent that Indebtedness is acquired in exchange for, or with the net proceeds from, the issuance of Qualified Capital Stock or warrants, options or other rights to acquire Qualified Capital Stock), 5(a), (6), (7), (8) and (9) shall be included in such calculation. Prior to any Restricted Payment under the first paragraph of this Section 4.03, the Company shall deliver to the Trustee an Officers' Certificate setting forth the computation by which the amount available for Restricted Payments pursuant to such paragraph was determined. The Trustee shall have no duty or responsibility to determine the accuracy or correctness of this computation and shall be fully protected in relying on such Officers' Certificate. D. Corporate Existence. Except as otherwise permitted by Article Five, the Company shall do or cause to be done all things reasonably necessary to preserve and keep in full force and effect its corporate or other existence and the corporate or other existence of each of its Significant Subsidiaries in accordance with the respective organizational documents of each such Significant Subsidiary and the material rights (charter and statutory) and franchises of the Company and each such Significant Subsidiary; provided, however, that the Company shall not be required to preserve, with respect to itself, any material right or franchise and, with respect to any of its Significant Subsidiaries, any such existence, material right or franchise, if the Board of Directors of the Company or such Significant Subsidiary, as the case may be, shall determine that the preservation thereof is no longer reasonably necessary or desirable in the conduct of the business of the Company or any such Significant Subsidiary. E. Payment of Taxes and Other Claims. The Company shall pay or discharge or cause to be paid or discharged, before the same shall become delinquent, (i) all material taxes, assessments and governmental charges (including withholding taxes and any penalties, interest and 45 46 additions to taxes) levied or imposed upon it or any of its Subsidiaries or properties of it or any of its Subsidiaries and (ii) all material lawful claims for labor, materials, supplies and services that, if unpaid, might by law become a Lien upon the property of it or any of its Subsidiaries; provided, however, that there shall not be required to be paid or discharged any such tax, assessment or charge, the amount, applicability or validity of which is being contested in good faith by appropriate proceedings and for which adequate provision has been made or where the failure to effect such payment or discharge is not adverse in any material respect to the Holders. F. Maintenance of Properties and Insurance. (a) The Company shall, and shall cause each of its Subsidiaries to, maintain its material properties in normal condition (subject to ordinary wear and tear) and make all reasonably necessary repairs, renewals or replacements thereto as in the judgment of the Company may be reasonably necessary to the conduct of the business of the Company and its Subsidiaries; provided, however, that nothing in this Section 4.06 shall prevent the Company or any of its Subsidiaries from discontinuing the operation and maintenance of any of its properties, if such properties are, in the reasonable and good faith judgment of the Board of Directors of the Company or the Subsidiary, as the case may be, no longer reasonably necessary in the conduct of their respective businesses. (b) The Company shall provide or cause to be provided, for itself and each of its Subsidiaries, insurance (including appropriate self-insurance) against loss or damage of the kinds that, in the reasonable, good faith opinion of the Company, are reasonably adequate and appropriate for the conduct of the business of the Company and such Subsidiaries. G. Compliance Certificate; Notice of Default. (a) The Company shall deliver to the Trustee, within 120 days after the end of the Company's fiscal year, an Officers' Certificate (signed by the principal executive officer, principal financial officer or principal accounting officer) stating that a review of its activities and the activities of its Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether it has kept, observed, performed and fulfilled its obligations under this Indenture and further stating, as to each such Officer signing such certificate, that to the best of his knowledge the Company during such preceding fiscal year has kept, observed, performed and fulfilled each and every such obligation and no Default or Event of Default occurred during such year and at the date of such certificate there is no Default or Event of Default that has occurred and 46 47 is continuing or, if such signers do know of such Default or Event of Default, the certificate shall describe the Default or Event of Default and its status with particularity. The Officers' Certificate shall also notify the Trustee should the Company elect to change the manner in which it fixes its fiscal year end. (b) The copy of the annual report on Form 10-K of the Company as filed with the SEC or the annual financial statements delivered to the Trustee pursuant to Section 4.09 shall be accompanied by a written report of the Company's independent accountants that in conducting their audit of the financial statements which are a part of such annual report or such annual financial statements nothing has come to their attention that would lead them to believe that the Company has violated any provisions of Article Four, Five or Six insofar as they relate to accounting matters or, if any such violation has occurred, specifying the nature and period of existence thereof, it being understood that such accountants shall not be liable directly or indirectly to any Person for any failure to obtain knowledge of any such violation. (c) (i) If any Default or Event of Default has occurred and is continuing or (ii) if any Holder seeks to exercise any remedy hereunder with respect to a claimed Default under this Indenture or the Securities, the Company shall deliver to the Trustee by registered or certified mail or by telegram, telex or facsimile transmission followed by hard copy by registered or certified mail an Officers' Certificate specifying such event, notice or other action within five Business Days of its becoming aware of such occurrence. H. Compliance with Laws. The Company shall comply, and shall cause each of its Subsidiaries to comply, with all applicable statutes, rules, regulations, orders and restrictions of the United States of America, all states and municipalities thereof, and of any governmental department, commission, board, regulatory authority, bureau, agency and instrumentality of the foregoing, in respect of the conduct of their respective businesses and the ownership of their respective properties, except for such noncompliances as are not in the aggregate reasonably likely to have a material adverse effect on the financial condition or results of operations of the Company and its Subsidiaries taken as a whole. I. SEC Reports. The Company shall file with the Trustee and provide to the Securityholders, within 15 days after it files them with the SEC, copies of the annual reports and of the information, 47 48 documents, and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) which the Company files with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. In the event that the Company is no longer required to furnish such reports to its securityholders pursuant to the Exchange Act, the Company will cause its consolidated financial statements, comparable to those which would have been required to appear in annual or quarterly reports, to be delivered to the Holders of the Securities. The Company shall also comply with the other provisions of TIA Section 314(a). J. Waiver of Stay, Extension or Usury Laws. The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or other law that would prohibit or forgive the Company from paying all or any portion of the principal of or interest on the Securities as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the obligations or the performance of this Indenture; and (to the extent that it may lawfully do so) the Company hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. K. Limitation on Transactions with Affiliates. Neither the Company nor any of its Subsidiaries will, directly or indirectly, enter into or permit to exist any transaction (including, without limitation, the purchase, sale, lease or exchange of any property or the rendering of any service) with or for the benefit of any of its Affiliates (other than transactions between the Company and a Wholly Owned Subsidiary of the Company or among Wholly Owned Subsidiaries of the Company) (an "Affiliate Transaction"), other than Affiliate Transactions on terms that are no less favorable than those that might reasonably have been obtained in a comparable transaction on an arm's-length basis from a Person that is not an Affiliate; provided, however, that for a transaction or series of related transactions involving value of $1,000,000 or more, such determination shall be made in good faith by a majority of the members of the Board of Directors of the Company and by a majority of the disinterested members of the Board of Directors of the Company, if any; provided, further, that for a transaction or series of related transactions involving value of $5,000,000 or more, the Board of Directors of the Company has received an opinion from a nationally recognized investment 48 49 banking firm that such Affiliate Transaction is fair, from a financial point of view, to the Company or such Subsidiary. The foregoing restrictions will not apply to reasonable and customary directors' fees, indemnification and similar arrangements and payments thereunder, or to any obligations of the Company under the Financial Monitoring and Oversight Agreements, the Tax Sharing Agreement or any employment agreement with any officer of the Company (provided that each amendment of any of the foregoing agreements shall be subject to the limitations of this Section 4.11), as well as reasonable and customary investment banking, financial advisory, commercial banking and similar fees and expenses paid to BT Securities Corporation and its Affiliates. L. Limitation on Incurrence of Additional Indebtedness. Neither the Company nor any of its Subsidiaries will, directly or indirectly, create, incur, assume, guarantee, acquire or become liable for, contingently or otherwise, (collectively "incur") any Indebtedness other than Permitted Indebtedness. Notwithstanding the foregoing limitations, the Company or any Subsidiary may incur Indebtedness if on the date of the incurrence of such Indebtedness, after giving effect to the incurrence of such Indebtedness and the receipt and application of the proceeds thereof, the Company's Leverage Ratio is less than 7.0 to 1. M. Limitation on Dividend and Other Payment Restrictions Affecting Subsidiaries. Neither the Company nor any of its Subsidiaries will, directly or indirectly, create or otherwise cause or permit to exist or become effective any encumbrance or restriction on the ability of any Subsidiary to (a) pay dividends or make any other distributions on its Capital Stock; (b) make loans or advances or pay any Indebtedness or other obligation owed to the Company or any of its Subsidiaries; or (c) transfer any of its property or assets to the Company, except for such encumbrances or restrictions existing under or by reason of: (1) applicable law, (2) this Indenture, (3) customary non-assignment provisions of any lease governing a leasehold interest of the Company or any Subsidiary, (4) any instrument governing Acquired Indebtedness, which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired, (5) agreements permitted under the 1996 Notes Indenture existing on the Issue Date (including the Credit Agreement) as such agreements are from time to time in effect; provided, however, that any amendments or modifications of such agreements which affect the encumbrances or restrictions of the types subject to this 49 50 Section 4.13 shall not result in such encumbrances or restrictions being less favorable to the Company in any material respect, as determined in good faith by the Board of Directors of the Company, than the provisions as in effect before giving effect to the respective amendment or modification, (6) an agreement effecting a refinancing, replacement or substitution of Indebtedness issued, assumed or incurred pursuant to an agreement referred to in clause (2), (4) or (5) above or any other agreement evidencing Indebtedness permitted under this Indenture; provided, however, that the provisions relating to such encumbrance or restriction contained in any such refinancing, replacement or substitution agreement or any such other agreement are not less favorable to the Company in all material respects as determined in good faith by the Board of Directors of the Company than the provisions relating to such encumbrance or restriction contained in agreements referred to in such clause (2), (4) or (5), or (7) restrictions on the transfer of assets subject to any Lien permitted under this Indenture imposed by the holder of such Lien. N. Prohibition on Incurrence of Senior Subordinated Indebtedness. The Company shall not incur or suffer to exist any Indebtedness that is senior in right of payment to the Securities and is expressly subordinate in right of payment to any other Indebtedness of the Company. O. Change of Control. (a) In the event of a Change of Control, the Company shall be obligated to make an offer to repurchase all outstanding Securities pursuant to the offer described in paragraph (b) below (the "Change of Control Offer"), at a purchase price equal to 101% of the principal amount thereof plus accrued interest, if any, to the date of repurchase. Prior to the mailing of the notice referred to below, but in any event within 30 days following the date on which a Change of Control occurs, the Company covenants to (i) repay in full all Indebtedness under the Credit Agreement (and terminate all commitments thereunder) or offer to repay in full all such Indebtedness (and terminate all such commitments) and to repay the Indebtedness owed to (and terminate the commitments of) each lender which has accepted such offer or (ii) obtain the requisite consents under the Credit Agreement to permit the repurchase of the Securities as provided below. The Company shall first comply with the covenant in the preceding sentence before it shall be required to repurchase Securities pursuant to the provisions described in this Section 4.15; provided that the Company's failure to comply with such covenant shall constitute an Event of Default under Section 6.01(3). 50 51 (b) Within 30 days following the date upon which a Change of Control occurs (the "Change of Control Date"), the Company shall send, by first class mail, a notice to each Holder of Securities, with a copy to the Trustee, which notice shall govern the terms of the Change of Control Offer. The notice to the Holders shall contain all instructions and materials necessary to enable such Holders to tender Securities pursuant to the Change of Control Offer. Such notice shall state: (1) that the Change of Control Offer is being made pursuant to this Section 4.15 and that all Securities validly tendered and not withdrawn will be accepted for payment; (2) the purchase price (including the amount of accrued interest, if any) and the purchase date (which shall be no earlier than 30 days nor later than 45 days from the date such notice is mailed, other than as may be required by law) (the "Change of Control Payment Date"); (3) that any Security not tendered will continue to accrue interest; (4) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Payment Date; (5) that Holders electing to have a Security purchased pursuant to a Change of Control Offer will be required to surrender the Security, properly endorsed for transfer together with such customary documents as the Company reasonably may request, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day prior to the Change of Control Payment Date; (6) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than five Business Days prior to the Change of Control Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Securities the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; (7) that Holders whose Securities are purchased only in part will be issued new Securities in a principal 51 52 amount equal to the unpurchased portion of the Securities surrendered; and (8) the circumstances and relevant facts regarding such Change of Control. (c) On or before the Change of Control Payment Date, the Company shall (i) accept for payment Securities or portions thereof (in integral multiples of $1,000) validly tendered pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the purchase price of all Securities so tendered and (iii) deliver to the Trustee Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall promptly mail to the Holders of Securities so accepted payment in an amount equal to the purchase price out of the funds deposited with the Paying Agent in accordance with the preceding sentence. The Trustee shall promptly authenticate and mail to such Holders new Securities equal in principal amount to any unpurchased portion of the Securities surrendered. Upon the payment of the purchase price for the Securities accepted for purchase, the Trustee shall return the Securities purchased to the Company for cancellation. Any amounts remaining after the purchase of Securities pursuant to a Change of Control Offer shall be returned by the Trustee to the Company. (d) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase of the Securities pursuant to a Change of Control Offer. To the extent the provisions of any such rule conflict with the provisions of this Indenture relating to a Change of Control Offer, the Company shall comply with the provisions of such rule and be deemed not to have breached its obligations relating to such Change of Control Offer by virtue thereof. P. Limitation on Asset Sales. (a) Neither the Company nor any of its Subsidiaries will consummate an Asset Sale unless (i) the Company or the applicable Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by management of the Company or, if such Asset Sale involves consideration in excess of $2,500,000, by the Board of Directors of the Company, as evidenced by a board resolution), (ii) at least 75% of the consideration received by the Company or the Subsidiary, as the case may be, from such Asset Sale is cash or Cash Equivalents (other than in the case where the Company is exchanging all or substantially 52 53 all the assets of one or more broadcast businesses operated by the Company (including by way of the transfer of the capital stock) for all or substantially all the assets (including by way of the transfer of the capital stock) constituting one or more broadcast businesses operated by another Person, in which event the foregoing requirement with respect to the receipt of cash or Cash Equivalents shall not apply) and is received at the time of such disposition and (iii) upon the consummation of an Asset Sale, the Company applies or causes such Subsidiary to apply, such Net Cash Proceeds within 180 days of receipt thereof, either (A) to repay the principal of any Senior Indebtedness (and, to the extent such Senior Indebtedness relates to principal under a revolving credit or similar facility, to obtain a corresponding reduction in the commitments thereunder), (B) to reinvest, or to be contractually committed to reinvest pursuant to a binding agreement, in Productive Assets and, in the latter case, to have so reinvested within 360 days of the date of receipt of such Net Cash Proceeds, or (C) to purchase Securities tendered to the Company for purchase at a price equal to 100% of the principal amount thereof, plus accrued interest thereon to the date of purchase, pursuant to an offer to purchase made by the Company as set forth below (a "Net Proceeds Offer"); provided, however, that, prior to making any such Net Proceeds Offer, the Company shall, to the extent required pursuant to the 1996 Notes Indenture as in effect on the Issue Date, offer to use such Net Cash Proceeds to repurchase and use all or a portion of such Net Cash Proceeds to repurchase 1996 Notes, in which event the Company shall be required to use only the Net Cash Proceeds remaining after such repurchase to make the Net Proceeds Offer contemplated by this Section 4.16; provided, further, that if at any time any non-cash consideration received by the Company or any Subsidiary of the Company, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash, then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with clause (iii) above; provided, further, that the Company may defer making a Net Proceeds Offer until the aggregate Net Cash Proceeds from Asset Sales (taking into account any Net Cash Proceeds used to repurchase 1996 Notes pursuant to the second immediately preceding proviso) to be applied equals or exceeds $5,000,000. In the event of a transaction effected in accordance with Section 5.01 which involves less than all of the property or assets of the Company, only property or assets not included in such transaction shall be deemed to have been transferred in an Asset Sale. (b) Subject to the deferral right set forth in the final proviso of paragraph (a), each notice of a Net Proceeds Offer pursuant to this Section 4.16 shall be mailed, by first class mail, by the Company to Holders of the Securities as shown on the applicable register of Holders of the Securities 53 54 not more than 180 days after the relevant Asset Sale or, in the event the Company or a Subsidiary has entered into a binding agreement as provided in (B) above, within 180 days following the termination of such agreement but in no event later than 360 days after the relevant Asset Sale, with a copy to the Trustee. The notice shall contain all instructions and materials necessary to enable such Holders to tender Securities pursuant to the Net Proceeds Offer and shall state the following terms: (1) that the Net Proceeds Offer is being made pursuant to Section 4.16 and that Holders of Securities may elect to tender their Securities in denominations of less than $1,000 and that all Securities validly tendered will be accepted for payment; provided, however, that if the aggregate principal amount of Securities tendered in a Net Proceeds Offer plus accrued interest at the expiration of such offer exceeds the aggregate amount of the Net Proceeds Offer, the Company shall select the Securities to be purchased on a pro rata basis (based upon the principal amount tendered); (2) the purchase price (including the amount of accrued interest) and the purchase date (which shall be no earlier than 30 days nor later than 45 days from the date such notice is mailed, other than as may be required by law) (the "Proceeds Purchase Date"); (3) that any Security not tendered will continue to accrue interest; (4) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Proceeds Purchase Date; (5) that Holders electing to have a Security purchased pursuant to a Net Proceeds Offer will be required to surrender the Security, properly endorsed for transfer together with such other customary documents as the Company reasonably may request, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day prior to the Proceeds Purchase Date; (6) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than five Business Days prior to the Proceeds Purchase Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Securities the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have 54 55 such Security purchased; (7) that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount equal to the unpurchased portion of the Securities surrendered; and (8) the circumstances and relevant facts regarding such Net Proceeds Offer. (c) On or before the Proceeds Purchase Date, the Company shall (i) accept for payment Securities or portions thereof validly tendered pursuant to the Net Proceeds Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the purchase price of all Securities so tendered and (iii) deliver to the Trustee Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall promptly mail to the Holders of Securities so accepted payment in an amount equal to the purchase price out of funds deposited with the Paying Agent in accordance with the preceding sentence. The Trustee shall promptly authenticate and mail to such Holders new Securities equal in principal amount to any unpurchased portion of the Securities surrendered. Upon payment of the purchase price for the Securities accepted for purchase, the Trustee shall return the Securities purchased to the Company for cancellation. Any Securities not so accepted shall be promptly mailed by the Company to the Holder thereof. (d) If the aggregate principal amount of Securities validly tendered pursuant to any Net Proceeds Offer is less than the amount of Net Cash Proceeds subject to such Net Proceeds Offer, the Company may use any remaining portion of such Net Cash Proceeds not required to fund the repurchase of tendered Securities for purposes otherwise permitted by this Indenture. Upon the consummation of any Net Proceeds Offer, the amount of Net Cash Proceeds subject to any future Net Proceeds Offer from the Asset Sales giving rise to such Net Cash Proceeds shall be deemed to be zero. (e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with their purchase of Securities pursuant to a Net Proceeds Offer. To the extent the provisions of any such rule conflict with the provisions of this Indenture relating to a Net Proceeds Offer, the Company shall comply with the provisions of such rule and be deemed not to have breached its obligations relating to such Net Proceeds Offer by virtue thereof. 55 56 Q. Limitation on Preferred Stock of Subsidiaries. The Company will not permit any of its Subsidiaries to issue any Preferred Stock (other than to the Company or to a Wholly Owned Subsidiary of the Company) or permit any Person (other than the Company or a Wholly Owned Subsidiary of the Company) to own any Preferred Stock (other than Acquired Preferred Stock; provided that at the time the issuer of such Acquired Preferred Stock becomes a Subsidiary of the Company or merges with the Company or any of its Subsidiaries, and after giving effect to such transaction, the Company shall be able to incur $1.00 of additional Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.12). R. Limitation on Liens. Neither the Company nor any of its Subsidiaries shall create, incur, assume or suffer to exist any Liens upon any of their respective assets, except for (a) Permitted Liens, (b) Liens to secure Senior Indebtedness or guarantees thereof permitted under this Indenture, (c) Liens permitted under the 1996 Notes Indenture existing on the Issue Date, (d) Liens in favor of the Trustee, (e) Liens to secure Guarantor Senior Indebtedness permitted under this Indenture and (f) any Lien to secure the replacement, refunding, extension or renewal, in whole or in part, of any Indebtedness described in the foregoing clauses; provided that, to the extent any such clause limits the amount secured or the asset subject to such Liens, no extension or renewal will increase the assets subject to such Liens or the amount secured thereby beyond the assets or amounts set forth in such clauses. S. Guarantees of Certain Indebtedness. The Company will not permit any of its Subsidiaries, directly or indirectly, to incur, guarantee or secure through the granting of Liens the payment of any Indebtedness under the Credit Agreement or any refunding or refinancing thereof in each case unless such Subsidiary, the Company and the Trustee execute and deliver a supplemental indenture pursuant to which such Subsidiary becomes a Guarantor of the Securities and which evidences such Subsidiary's Guarantee of the Securities, such Guarantee to be a senior subordinated unsecured obligation of such Subsidiary. Neither the Company nor any Guarantor shall be required to make a notation on the Securities or its Guarantee to reflect any such subsequent Guarantee. Nothing in this Section 4.19 shall be construed to permit any Subsidiary of the Company to incur Indebtedness otherwise prohibited by Section 4.12. 56 57 T. Limitation on Sale and Leaseback Transactions. Neither the Company nor any of its Subsidiaries will enter into any Sale and Leaseback Transaction, except that the Company or any Subsidiary may enter into a Sale and Leaseback Transaction if, immediately prior thereto, and after giving effect to such Sale and Leaseback Transaction (the Indebtedness thereunder being equivalent to the Attributable Value thereof) the Company could incur at least $1.00 of additional Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.12. U. Limitation on Line of Business. For so long as any Securities are outstanding, the Company and its Subsidiaries will engage solely in the ownership and operation of broadcast businesses or businesses reasonably related thereto. V. Limitation on Asset Swaps. Neither the Company nor any of its Subsidiaries shall engage in any Asset Swaps, unless: (i) at the time of entering into the agreement to swap assets and immediately after giving effect to the proposed Asset Swap, no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; (ii) the Company would, after giving pro forma effect to the proposed Asset Swap, have been permitted to incur at least $1.00 of additional Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.12; (iii) the respective fair market values of the assets being purchased and sold by the Company or any of its Subsidiaries (as determined in good faith by the management of the Company or, if such Asset Swap includes consideration in excess of $2,500,000 by the Board of Directors, as evidenced by a Board Resolution delivered to the Trustee) are substantially the same at the time of entering into the agreement to swap assets; and (iv) at the time of the consummation of the proposed Asset Swap, the percentage of any decline in the fair market value (determined as aforesaid) of the asset or assets being acquired by the Company and its Subsidiaries shall not be significantly greater than the percentage of any decline in the fair market value (determined as aforesaid) of the assets being disposed of by the Company, calculated from the time the agreement to swap assets was entered into, provided, however, that this Section 4.22 shall not apply to any of the Pending Transactions. 57 58 V. SUCCESSOR CORPORATION A. When Company May Merge, Etc. (a) The Company shall not, in a single transaction or through a series of related transactions, consolidate with or merge with or into, or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its assets to, another Person or adopt a plan of liquidation, unless: (1) either (A) the Company shall be the survivor of such merger or consolidation or (B) the surviving or transferee Person is a corporation, partnership or trust organized and existing under the laws of the United States, any State thereof or the District of Columbia and such surviving or transferee Person shall expressly assume by supplemental indenture all the obligations of the Company under the Securities and this Indenture; (2) immediately after giving effect to such transaction and the use of the proceeds therefrom (on a pro forma basis, including any Indebtedness incurred or anticipated to be incurred in connection with such transaction), the Company or the surviving or transferee Person is able to incur $1.00 of additional Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.12; (3) immediately after giving effect to such transaction (including any Indebtedness incurred or anticipated to be incurred in connection with the transaction) no Default or Event of Default shall have occurred and be continuing; and (4) the Company has delivered to the Trustee an Officers' Certificate and Opinion of Counsel, each stating that such consolidation, merger or transfer complies with this Indenture, that the surviving or transferee Person agrees by supplemental indenture to be bound hereby, and that all conditions precedent in this Indenture relating to such transaction have been satisfied. (b) For purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a single transaction or series of related transactions) of all or substantially all of the properties and assets of one or more Subsidiaries, the Capital Stock of which constitutes all or substantially all of the properties and assets of the Company, shall be deemed to be the transfer of all or substantially all of the properties and assets of the Company. 58 59 B. Successor Corporation Substituted. Upon any consolidation or merger, or any transfer of assets in accordance with Section 5.01, the successor Person formed by such consolidation or into which the Company is merged or to which such transfer is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor Person had been named as the Company herein. When a successor corporation assumes all of the obligations of the Company hereunder and under the Securities and agrees to be bound hereby and thereby, the predecessor shall be released from such obligations. VI. DEFAULT AND REMEDIES A. Events of Default. An "Event of Default" occurs if: (1) the Company defaults in the payment of interest on the Securities when the same becomes due and payable and the Default continues for a period of 30 days (whether or not such payment shall be prohibited by Article Ten); or (2) the Company defaults in the payment of the principal of any Securities when the same becomes due and payable, at maturity, upon redemption or otherwise (whether or not such payment shall be prohibited by Article Ten); or (3) the Company fails to observe or perform any other covenant or agreement contained in the Securities or this Indenture and the Default continues for a period of 30 days after written notice thereof specifying such Default has been given to the Company by the Trustee or the Holders of at least 25% in aggregate principal amount of the outstanding Securities; or (4) there shall be a failure to pay at the final stated maturity (giving effect to any extensions thereof) the principal amount of any Indebtedness of the Company or any Subsidiary of the Company, or the acceleration of the final stated maturity (giving effect to any extensions thereof) of any such Indebtedness, if the aggregate principal amount of such Indebtedness, together with the aggregate principal amount of any other such Indebtedness in 59 60 default for failure to pay principal at the final stated maturity (giving effect to any extensions thereof) or which has been accelerated, aggregates $5,000,000 or more at any time, in each case after a 10-day period during which such default shall not have been cured or such acceleration rescinded; or (5) one or more judgments in an aggregate amount in excess of $5,000,000 (which are not covered by insurance as to which the insurer has not disclaimed coverage) shall have been rendered against the Company or any of its Significant Subsidiaries and such judgments remain undischarged or unstayed for a period of 60 days after such judgment or judgments become final and non-appealable; or (6) the Company or any Significant Subsidiary (A) commences a voluntary case or proceeding under any Bankruptcy Law with respect to itself, (B) consents to the entry of a judgment, decree or order for relief against it in an involuntary case or proceeding under any Bankruptcy Law, (C) consents to the appointment of a Custodian of it or for substantially all of its property, (D) consents to or acquiesces in the institution of a bankruptcy or an insolvency proceeding against it or (E) makes a general assignment for the benefit of its creditors; or (7) a court of competent jurisdiction enters a judgment, decree or order for relief in respect of the Company or any Significant Subsidiary in an involuntary case or proceeding under any Bankruptcy Law, which shall (A) approve as properly filed a petition seeking reorganization, arrangement, adjustment or composition in respect of the Company or any Significant Subsidiary, (B) appoint a Custodian of the Company or any Significant Subsidiary or for substantially all of its property or (C) order the winding-up or liquidation of its affairs; and such judgment, decree or order shall remain unstayed and in effect for a period of 60 consecutive days. B. Acceleration. If an Event of Default (other than an Event of Default specified in Section 6.01(6) or (7) with respect to the Company) occurs and is continuing and has not been waived pursuant to Section 6.04, the Trustee may, by notice to the Company, or the Holders of at least 25% in aggregate principal amount of the Securities then outstanding may, by written notice to the Company and the Trustee, and the Trustee shall, 60 61 upon the request of such Holders, declare the aggregate principal amount of the Securities outstanding, together with accrued but unpaid interest, if any, on all Securities to be due and payable by notice in writing to the Company and the Trustee specifying the respective Event of Default and that it is a "notice of acceleration" (the "Acceleration Notice"), and the same (i) shall become immediately due and payable or (ii) if there are any amounts outstanding under the Credit Agreement, shall become due and payable upon the first to occur of an acceleration under the Credit Agreement or 5 Business Days after receipt by the Company and the Representative under the Credit Agreement of such Acceleration Notice (unless all Events of Default specified in such Acceleration Notice have been cured or waived). If an Event of Default specified in Section 6.01(6) or (7) occurs and is continuing with respect to the Company, all unpaid principal and accrued interest on the Securities then outstanding shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Securityholder. The Holders of a majority in principal amount of the Securities then outstanding (by notice to the Trustee) may rescind and cancel a declaration of acceleration and its consequences if (i) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction, (ii) all existing Events of Default have been cured or waived, except non-payment of the principal or interest on the Securities which have become due solely by such declaration of acceleration, (iii) to the extent the payment of such interest is lawful, interest (at the same rate as specified in the Securities) on overdue installments of interest and overdue payments of principal, which has become due otherwise than by such declaration of acceleration, has been paid, (iv) the Company has paid the Trustee its reasonable compensation and reimbursed the Trustee for its expenses, disbursements and advances and (v) in the event of the cure or waiver of a Default or Event of Default of the type described in Sections 6.01(6) and (7), the Trustee shall have received an Officers' Certificate and an Opinion of Counsel that such Default or Event of Default has been cured or waived and the Trustee shall be entitled to conclusively rely upon such Officer's Certificate and Opinion of Counsel. No such rescission shall affect any subsequent Default or impair any right consequent thereto. C. Other Remedies. If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal of or interest on the Securities or to enforce the performance of any provision of the Securities or this Indenture. The Trustee may maintain a proceeding even if it does 61 62 not possess any of the Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Securityholder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are cumulative to the extent permitted by law. D. Waiver of Past Defaults. Subject to Sections 6.07 and 9.02, the Holders of a majority in principal amount of the outstanding Securities by notice to the Trustee may waive an existing Default or Event of Default and its consequences, except a Default in the payment of principal of or interest on any Security as specified in clauses (1) and (2) of Section 6.01. E. Control by Majority. The Holders of a majority in principal amount of the outstanding Securities may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it, including, without limitation, any remedies provided for in Section 6.03. Subject to Section 7.01, however, the Trustee may, in its discretion, refuse to follow any direction that conflicts with any law or this Indenture, that the Trustee determines may be unduly prejudicial to the rights of another Securityholder, or that may involve the Trustee in personal liability; provided that the Trustee may take any other action deemed proper by the Trustee, in its discretion, which is not inconsistent with such direction. F. Limitation on Suits. A Securityholder may not pursue any remedy with respect to this Indenture or the Securities unless: (1) the Holder gives to the Trustee notice of a continuing Event of Default; (2) Holders of at least 25% in principal amount of the outstanding Securities make a written request to the Trustee to pursue the remedy; (3) such Holders offer to the Trustee reasonably satisfactory to the Trustee indemnity or security against any loss, liability or expense to be incurred in compliance with such request; (4) the Trustee does not comply with the request 62 63 within 45 days after receipt of the request and the offer of satisfactory indemnity or security; and (5) during such 45-day period the Holders of a majority in principal amount of the outstanding Securities do not give the Trustee a direction which, in the opinion of the Trustee, is inconsistent with the request. A Securityholder may not use this Indenture to prejudice the rights of another Securityholder or to obtain a preference or priority over such other Securityholder. G. Rights of Holders To Receive Payment. Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of principal of and interest on a Security, on or after the respective due dates expressed in such Security, or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder. H. Collection Suit by Trustee. If an Event of Default in payment of principal or interest specified in clause (1) or (2) of Section 6.01 occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company or any other obligor on the Securities for the whole amount of principal and accrued interest remaining unpaid, together with interest on overdue principal and, to the extent that payment of such interest is lawful, interest on overdue installments of interest at the rate set forth in the Securities and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. I. Trustee May File Proofs of Claim. The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, taxes, disbursements and advances of the Trustee, its agents and counsel) and the Securityholders allowed in any judicial proceedings relating to the Company or any other obligor upon the Securities, any of their respective creditors or any of their respective property, and shall be entitled and empowered to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same, and any Custodian in any 63 64 such judicial proceedings is hereby authorized by each Securityholder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Securityholders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, taxes, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07. The Company's payment obligations under this Section 6.09 shall be secured in accordance with the provisions of Section 7.07. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Securityholder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Securityholder in any such proceeding. J. Priorities. If the Trustee collects any money pursuant to this Article Six, it shall pay out the money in the following order: First: to the Trustee for amounts due under Sections 6.09 and 7.07; Second: if the Holders are forced to proceed against the Company directly without the Trustee, to Holders for their collection costs; Third: to Holders for amounts due and unpaid on the Securities for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest, respectively; and Fourth: to the Company or any other obligor on the Securities, as their interests may appear, or as a court of competent jurisdiction may direct. The Trustee, upon prior notice to the Company, may fix a record date and payment date for any payment to Securityholders pursuant to this Section 6.10. K. Undertaking for Costs. In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the 64 65 suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07, or a suit by a Holder or Holders of more than 10% in principal amount of the outstanding Securities. VII. TRUSTEE A. Duties of Trustee. (a) If a Default or an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture and use the same degree of care and skill in its exercise thereof as a prudent Person would exercise or use under the circumstances in the conduct of its own affairs. (b) Except during the continuance of a Default or an Event of Default: (1) The Trustee need perform only those duties as are specifically set forth in this Indenture or the TIA and no duties, covenants, responsibilities or obligations shall be implied in this Indenture that are adverse to the Trustee. (2) In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates (including Officers' Certificates) or opinions (including Opinions of Counsel) furnished to the Trustee and conforming to the requirements of this Indenture. However, as to any certificates or opinions which are required by any provision of this Indenture to be delivered or provided to the Trustee, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture. (c) Notwithstanding anything to the contrary herein contained, the Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: (1) This paragraph does not limit the effect of paragraph (b) of this Section 7.01. 65 66 (2) The Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts. (3) The Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.02, 6.04 or 6.05. (d) No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (e) Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.01. (f) The Trustee shall not be liable for interest on any money or assets received by it except as the Trustee may agree with the Company. Assets held in trust by the Trustee need not be segregated from other assets except to the extent required by law. (g) In the absence of bad faith, negligence or wilful misconduct on the part of the Trustee, the Trustee shall not be responsible for the application of any money by any Paying Agent other than the Trustee. B. Rights of Trustee. Subject to Section 7.01: (a) The Trustee may rely and shall be fully protected in acting or refraining from acting upon any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the document. (b) Before the Trustee acts or refrains from acting, it may consult with counsel and may require an Officers' Certificate or an Opinion of Counsel, which shall conform to Sections 11.04 and 11.05. The Trustee shall not be liable for and shall be fully protected in respect of any action it takes or omits to take in good faith in reliance on such Officers' Certificate or Opinion of Counsel. 66 67 (c) The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent or attorney appointed with due care. (d) The Trustee shall not be liable for any action that it takes or omits to take in good faith which it reasonably believes to be authorized or within its rights or powers. (e) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate (including any Officers' Certificate), statement, instrument, opinion (including any Opinion of Counsel), notice, request, direction, consent, order, bond, debenture, or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled, upon reasonable notice to the Company, to examine the books, records, and premises of the Company, personally or by agent or attorney. (f) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Holders of the Securities pursuant to the provisions of this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which may be incurred by it in compliance with such request, order or direction. (g) The Trustee may consult with counsel, and the advice or opinion of counsel with respect to legal matters relating to this Indenture and the Securities shall be full and complete authorization and protection from liability with respect to any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel. C. Individual Rights of Trustee. The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company, any Subsidiary or Unrestricted Subsidiary, or their respective Affiliates, with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. However, the Trustee must comply with 67 68 Sections 7.10 and 7.11. D. Trustee's Disclaimer. The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities, and it shall not be accountable for the Company's use of the proceeds from the Securities, and it shall not be responsible for any statement of the Company in this Indenture or the Securities other than the Trustee's certificate of authentication. E. Notice of Default. If a Default or an Event of Default occurs and is continuing and if it is known to the Trustee, the Trustee shall mail to each Securityholder notice of the uncured Default or Event of Default within 60 days after such Default or Event of Default occurs. Except in the case of a Default or an Event of Default in payment of principal of, or interest on, any Security, including an accelerated payment and the failure to make payment on the Change of Control Payment Date pursuant to a Change of Control Offer or on the Proceeds Purchase Date pursuant to a Net Proceeds Offer and, except in the case of a failure to comply with Article Five, the Trustee may withhold the notice if and so long as its Board of Directors, the executive committee of its Board of Directors or a committee of its directors and/or Trust Officers in good faith determines that withholding the notice is in the interest of the Securityholders. The Trustee shall not be deemed to have knowledge of a Default or Event of Default other than (i) any Event of Default occurring pursuant to Section 6.01(1), 6.01(2) or 4.01; or (ii) any Default or Event of Default of which a Trust Officer shall have received written notification or obtained actual knowledge. F. Reports by Trustee to Holders. Within 60 days after each May 15 of each year beginning with May 15, 1998, the Trustee shall, to the extent that any of the events described in TIA Section 313(a) occurred within the previous twelve months, but not otherwise, mail to each Securityholder a brief report dated as of such date that complies with TIA Section 313(a). The Trustee also shall comply with TIA Sections 313(b) and 313(c). A copy of each report at the time of its mailing to Securityholders shall be mailed to the Company and filed with the SEC and each stock exchange, if any, on which the Securities are listed. The Company shall promptly notify the Trustee if the Securities become listed on any stock exchange and the Trustee 68 69 shall comply with TIA Section 313(d). G. Compensation and Indemnity. The Company shall pay to the Trustee from time to time such compensation as may be agreed upon by the Company and the Trustee. The Trustee's compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses, disbursements and advances incurred or made by it in connection with the performance of its duties and the discharge of its obligations under this Indenture. Such expenses shall include the reasonable fees and expenses of the Trustee's agents and counsel. The Company shall indemnify the Trustee and its agents, employees, officers, stockholders and directors for, and hold them harmless against, any loss, liability or expense incurred by them except for such actions to the extent caused by any negligence, bad faith or willful misconduct on their part, arising out of or in connection with the acceptance or administration of this trust including the reasonable costs and expenses of defending themselves against any claim or liability in connection with the exercise or performance of any of their rights, powers or duties hereunder. The Trustee shall notify the Company promptly of any claim asserted against the Trustee for which it may seek indemnity. The Company shall defend the claim and the Trustee shall cooperate in the defense. The Trustee may have separate counsel and the Company shall pay the reasonable fees and expenses of such counsel; provided that the Company will not be required to pay such fees and expenses if it assumes the Trustee's defense and there is no conflict of interest between the Company and the Trustee in connection with such defense as reasonably determined by the Trustee. The Company need not pay for any settlement made without its written consent. The Company need not reimburse any expense or indemnify against any loss or liability to the extent incurred by the Trustee through its negligence, bad faith or willful misconduct. To secure the Company's payment obligations in this Section 7.07, the Trustee shall have a lien prior to the Securities on all assets or money held or collected by the Trustee, in its capacity as Trustee, except assets or money held in trust to pay principal of or interest on particular Securities. When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(6) or (7) occurs, such expenses and the compensation for such services shall be paid to the extent allowed under any Bankruptcy Law. 69 70 H. Replacement of Trustee. The Trustee may resign by so notifying the Company. The Holders of a majority in principal amount of the outstanding Securities may remove the Trustee by so notifying the Company and the Trustee and may appoint a successor trustee. The Company may remove the Trustee if: (1) the Trustee fails to comply with Section 7.10; (2) the Trustee is adjudged bankrupt or insolvent; (3) a receiver or other public officer takes charge of the Trustee or its property; or (4) the Trustee becomes incapable of acting. If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall notify each Holder of such event and shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the Securities may appoint a successor Trustee to replace the successor Trustee appointed by the Company. A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Promptly after that, the retiring Trustee shall transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided in Section 7.07, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. A successor Trustee shall mail notice of its succession to each Securityholder. If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of at least 10% in principal amount of the outstanding Securities may petition any court of competent jurisdiction for the appointment of a successor Trustee. If the Trustee fails to comply with Section 7.10, any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Company's obligations under Section 7.07 shall continue for the benefit of the retiring Trustee. 70 71 I. Successor Trustee by Merger, Etc. If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the resulting, surviving or transferee corporation without any further act shall, if such resulting, surviving or transferee corporation is otherwise eligible hereunder, be the successor Trustee; provided that such corporation shall be otherwise qualified and eligible under this Article Seven. J. Eligibility; Disqualification. This Indenture shall always have a Trustee who satisfies the requirement of TIA Sections 310(a)(1) and 310(a)(2). The Trustee (or in the case of a corporation included in a bank holding company system, the related bank holding company) shall have a combined capital and surplus of at least $100,000,000 as set forth in its most recent published annual report of condition. In addition, if the Trustee is a corporation included in a bank holding company system, the Trustee, independently of such bank holding company, shall meet the capital requirements of TIA Section 310(a)(2). The Trustee shall comply with TIA Section 310(b); provided, however, that there shall be excluded from the operation of TIA Section 310(b)(1) any indenture or indentures under which other securities, or certificates of interest or participation in other securities, of the Company are outstanding, if the requirements for such exclusion set forth in TIA Section 310(b)(1) are met. The provisions of TIA Section 310 shall apply to the Company and any other obligor of the Securities. K. Preferential Collection of Claims Against the Company The Trustee shall comply with TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated therein. The provisions of TIA Section 311 shall apply to the Company and any other obligor of the Securities. VIII. DISCHARGE OF INDENTURE; DEFEASANCE A. Termination of the Company's Obligations. This Indenture shall cease to be of further effect and the obligations of the Company under the Securities and this Indenture shall terminate (except that the obligations under Sections 7.07, 8.04 and 8.05 shall survive the effect of this Article Eight) when all outstanding Securities theretofore 71 72 authenticated and issued have been delivered to the Trustee for cancellation and the Company has paid all sums payable by it hereunder. In addition, at the Company's option, either (a) the Company shall be deemed to have been Discharged from any and all obligations with respect to the Securities (except for certain obligations of the Company to register the transfer or exchange of such Securities, replace stolen, lost or mutilated Securities, maintain paying agencies and hold moneys for payment in trust) after the applicable conditions set forth below have been satisfied or (b) the Company shall cease to be under any obligation to comply with any term, provision or condition set forth in Article Four (except that the Company's obligations under Sections 4.01 and 4.02 shall survive) and Section 5.01 after the applicable conditions set forth below have been satisfied: (1) The Company shall have deposited or caused to be deposited irrevocably with the Trustee as trust funds in trust, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of the Securities U.S. Legal Tender or U.S. Government Obligations or a combination thereof which, through the payment of interest thereon and principal in respect thereof in accordance with their terms, will be sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay all the principal of and interest on the Securities on the dates such installments of interest or principal are due in accordance with the terms of such Securities, as well as the Trustee's fees and expenses; provided that no deposits made pursuant to this Section 8.01(1) shall cause the Trustee to have a conflicting interest as defined in and for purposes of the TIA; provided, further, that from and after the time of deposit, the Funds deposited shall not be subject to the rights of holders of Senior Indebtedness pursuant to the provisions of Article Ten; and provided, further, that, as confirmed by an Opinion of Counsel, no such deposit shall result in the Company, the Trustee or the trust becoming or being deemed to be an "investment company" under the Investment Company Act of 1940; (2) The Company shall have delivered to the Trustee an Opinion of Counsel or a private letter ruling issued to the Company by the IRS to the effect that the Holders of the Securities will not recognize income, gain or loss for federal income tax purposes as a result of the deposit and related defeasance and will be subject to federal income tax on the same amount and in the same manner and at the same times as would have been the case if such option had 72 73 not been exercised and, in the case of an Opinion of Counsel furnished in connection with a Discharge pursuant to the foregoing, accompanied by a private letter ruling issued to the Company by the IRS to such effect; (3) No Event of Default or Default with respect to the Securities shall have occurred and be continuing on the date of such deposit after giving effect to such deposit; (4) The Company shall have delivered to the Trustee an Opinion of Counsel, subject to certain qualifications, to the effect that (i) the Funds will not be subject to any rights of any other holders of Indebtedness of the Company, and (ii) the Funds so deposited will not be subject to avoidance under applicable Bankruptcy Law; (5) The Company shall have paid or duly provided for payment of all amounts then due to the Trustee pursuant to Section 7.07; (6) No such deposit will result in a Default under this Indenture or a breach or violation of, or constitute a default under, any other instrument or agreement (including, without limitation, the Credit Agreement) to which the Company or any of its Subsidiaries is a party or by which it or its property is bound; and (7) An Officers' Certificate and an Opinion of Counsel to the effect that all conditions precedent to the defeasance have been complied with. Notwithstanding the foregoing, the Opinion of Counsel required by subparagraph 2 above need not be delivered if all Securities not theretofore delivered to the Trustee for cancellation (i) have become due and payable, (ii) will become due and payable on the Maturity Date within one year, or (iii) are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company. "Discharged" means that the Company shall be deemed to have paid and discharged the entire indebtedness represented by, and obligations under, the Securities and to have satisfied all the obligations under this Indenture relating to the Securities (and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging the same upon compliance by the Company with the provisions of this Section), except (i) the rights of the Holders of Securities to receive, from the trust fund described in clause (1) above, payment of the principal of and the interest on such Securities when such 73 74 payments are due, (ii) the Company's obligations with respect to the Securities under Sections 2.03 through 2.07, 7.07 and 7.08 and (iii) the rights, powers, trusts, duties and immunities of the Trustee hereunder. "Funds" means the aggregate amount of U.S. Legal Tender and/or U.S. Government Obligations deposited with the Trustee pursuant to this Article Eight. "U.S. Government Obligations" means direct obligations of, and obligations guaranteed by, the United States of America for the payment of which the full faith and credit of the United States of America is pledged. SECTION 8.02. Acknowledgment of Discharge by Trustee. Subject to Section 8.05, after (i) the conditions of Section 8.01, have been satisfied and (ii) the Company has delivered to the Trustee an Opinion of Counsel, stating that all conditions precedent referred to in clause (i) above relating to the satisfaction and discharge of this Indenture have been complied with, the Trustee upon written request of the Company shall acknowledge in writing the discharge of the Company's obligations under this Indenture except for those surviving obligations specified in this Article Eight. SECTION 8.03. Application of Trust Money. The Trustee shall hold in trust Funds deposited with it pursuant to Section 8.01. It shall apply the Funds through the Paying Agent and in accordance with this Indenture to the payment of principal and accrued and unpaid interest on the Securities. SECTION 8.04. Repayment to the Company. The Trustee and the Paying Agent shall promptly pay to the Company any Funds held by them for the payment of principal or interest that remains unclaimed for one year; provided, however, that the Trustee or such Paying Agent may, at the expense of the Company, cause to be published once in a newspaper of general circulation in the City of New York or mailed to each Holder, notice that such Funds remain unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication or mailing, any unclaimed balance of such Funds then remaining will be repaid to the Company. After payment to the Company, Holders entitled to the Funds must look to the Company for payment as general creditors unless an applicable abandoned property law designates another Person and all liability of the Trustee and Paying Agent with respect to such Funds shall cease. 74 75 SECTION 8.05. Reinstatement. If the Trustee or Paying Agent is unable to apply any Funds by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company's obligations under this Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.01 until such time as the Trustee or Paying Agent is permitted to apply all such Funds in accordance with Section 8.01; provided, however, that if the Company has made any payment of interest on or principal of any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from Funds held by the Trustee or Paying Agent. IX. AMENDMENTS, SUPPLEMENTS AND WAIVERS A. Without Consent of Holders. The Company, when authorized by a Board Resolution, and the Trustee, together, may amend or supplement this Indenture or the Securities without notice to or consent of any Securityholder: (1) to cure any ambiguity, defect or inconsistency; (2) to comply with Article Five; (3) to provide for uncertificated Securities in addition to or in place of certificated Securities; or (4) to make any other change that does not adversely affect in any material respect the rights of any Securityholders hereunder; provided that the Company has delivered to the Trustee an Opinion of Counsel and an Officers' Certificate, each stating that such amendment or supplement complies with the provisions of this Section 9.01. B. With Consent of Holders. Subject to Section 6.07, the Company, when authorized by a Board Resolution, and the Trustee, together, with the written consent of the Holder or Holders of at least a majority 75 76 in principal amount of the outstanding Securities may amend or supplement this Indenture or the Securities, without notice to any other Securityholders. Subject to Sections 6.04 and 6.07, the Holder or Holders of a majority in aggregate principal amount of the outstanding Securities may waive compliance by the Company with any provision of this Indenture or the Securities without notice to any other Securityholder. No amendment, supplement or waiver, including a waiver pursuant to Section 6.04, shall, directly or indirectly, without the consent of each Holder of each Security affected thereby: (1) reduce the amount of Securities whose Holders must consent to an amendment; (2) reduce the rate of or change the time for payment of interest, including defaulted interest, on any Securities; (3) reduce the principal of or change the fixed maturity of any Securities, or change the date on which any Securities may be subject to redemption or repurchase, or reduce the redemption or repurchase price therefor; (4) make any Securities payable in money other than that stated in the Securities; (5) make any change in provisions of this Indenture protecting the right of each Holder of a Security to receive payment of principal of and interest on such Security on or after the due date thereof or to bring suit to enforce such payment or permitting Holders of a majority in principal amount of Securities to waive Defaults or Events of Default; or (6) after the Company's obligation to purchase the Securities arises under Section 4.14 or 4.15, amend, modify or change the obligation of the Company to consummate a Change of Control Offer or a Net Proceeds Offer or waive any default in the performance thereof or modify any of the provisions or definitions with respect to any such offers. It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof. After an amendment, supplement or waiver under this Section 9.02 becomes effective (as provided in Section 9.04), the Company shall mail to the Holders affected thereby a notice briefly describing the amendment, supplement or waiver. Any 76 77 failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. C. Compliance with TIA. Every amendment, waiver or supplement of this Indenture or the Securities shall comply with the TIA as then in effect. D. Revocation and Effect of Consents. Until an amendment, waiver or supplement becomes effective, a consent to it by a Holder is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder's Security, even if notation of the consent is not made on any Security. Subject to the following paragraph, any such Holder or subsequent Holder may revoke the consent as to his Security or portion of his Security by notice to the Trustee or the Company received before the date on which the Trustee receives an Officers' Certificate certifying that the Holders of the requisite principal amount of Securities have consented (and not theretofore revoked such consent) to the amendment, supplement or waiver (at which time such amendment, supplement or waiver shall become effective). The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment, supplement or waiver. If a record date is fixed, then notwithstanding the last sentence of the immediately preceding paragraph, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to revoke any consent previously given, whether or not such Persons continue to be Holders after such record date. No such consent shall be valid or effective for more than 120 days after such record date. After an amendment, supplement or waiver becomes effective, it shall bind every Securityholder, unless it makes a change described in any of clauses (1) through (6) of Section 9.02, in which case, the amendment, supplement or waiver shall bind only each Holder of a Security who has consented to it and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder's Security; provided that any such waiver shall not impair or affect the right of any Holder to receive payment of principal of and interest on a Security, on or after the respective due dates expressed in such Security, or to bring suit for the enforcement of any such payment on or after such respective dates without the consent of such Holder. 77 78 E. Notation on or Exchange of Securities. If an amendment, supplement or waiver changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security about the changed terms and return it to the Holder. Alternatively, if the Company or the Trustee so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms. F. Trustee To Sign Amendments, Etc. The Trustee shall execute any amendment, supplement or waiver authorized pursuant to and adopted in accordance with this Article Nine; provided that the Trustee may, but shall not be obligated to, execute any such amendment, supplement or waiver which affects the Trustee's own rights, duties or immunities under this Indenture. The Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel and an Officers' Certificate each stating that the execution of any amendment, supplement or waiver authorized pursuant to this Article Nine is authorized or permitted by this Indenture. Such Opinion of Counsel shall not be an expense of the Trustee. X. SUBORDINATION OF SECURITIES A. Securities Subordinated to Senior Indebtedness. The Company covenants and agrees and the Trustee and each Holder of the Securities, by its acceptance thereof, likewise covenants and agrees, that all Securities shall be issued subject to the provisions of this Article Ten; and the Trustee and each Person holding any Security, whether upon original issue or upon transfer, assignment or exchange thereof, accepts and agrees that the payment of all Obligations on the Securities (except for the payment of fees and expenses of the Trustee and any indemnity under Section 7.07) by the Company shall, to the extent and in the manner herein set forth, be subordinated and junior in right of payment to the prior payment in full in cash or Cash Equivalents (or such payment shall be duly provided for to the satisfaction of the holders of the Senior Indebtedness) of all Obligations on the Senior Indebtedness; that the subordination is for the benefit of, and shall be enforceable directly by, the holders of Senior Indebtedness, and that each holder of Senior Indebtedness whether now outstanding or hereafter created, incurred, assumed or guaranteed 78 79 shall be deemed to have acquired Senior Indebtedness in reliance upon the covenants and provisions contained in this Indenture and the Securities. B. No Payment on Securities in Certain Circumstances. (a) If any default occurs and is continuing in the payment when due, whether at maturity, upon any redemption, by declaration or otherwise, of any principal of, interest on or any other amounts owing with respect to any Senior Indebtedness, no payment of any kind or character (except (i) in Qualified Capital Stock issued by the Company to pay interest on the Securities or issued in exchange for the Securities, (ii) in securities substantially identical to the Securities issued by the Company in payment of interest accrued thereon or (iii) in securities issued by the Company which are subordinated to the Senior Indebtedness at least to the same extent as the Securities and having a Weighted Average Life to Maturity at least equal to the remaining Weighted Average Life to Maturity of the Securities (the issuance of such subordinated securities to be consented to by the holders of at least a majority of the outstanding amount of Senior Indebtedness consisting of each class of Designated Senior Indebtedness then outstanding, which subordinated securities shall be issued in exchange for outstanding Securities or to pay interest accrued on outstanding Securities)) shall be made by the Company or any other Person on behalf of the Company with respect to any Obligations on the Securities or to acquire any of the Securities for cash or property or otherwise. In addition, if any other event of default occurs and is continuing (or if such an event of default would occur upon any payment with respect to the Securities or would arise upon the passage of time as a result of such payment) with respect to any Designated Senior Indebtedness (as such event of default is defined in the instrument creating or evidencing such Designated Senior Indebtedness) and such event of default permits the holders of such Designated Senior Indebtedness then outstanding to accelerate the maturity thereof and if the Representative for the respective issue of Designated Senior Indebtedness gives written notice of the event of default to the Company and the Trustee (a "Default Notice"), then, unless and until all events of default have been cured or waived or have ceased to exist or the Company and the Trustee receive notice from the Representative for the respective issue of Designated Senior Indebtedness terminating the Blockage Period (as defined below), during the 180 days after the delivery of such Default Notice (the "Blockage Period"), neither the Company nor any other Person on behalf of the Company shall make any payment of any kind or character (except (i) in Qualified Capital Stock issued by the Company to pay interest on the Securities or issued in exchange for the Securities, (ii) in securities substantially identical to the 79 80 Securities issued by the Company in payment of interest accrued thereon or (iii) in securities issued by the Company which are subordinated to the Senior Indebtedness at least to the same extent as the Securities and having a Weighted Average Life to Maturity at least equal to the remaining Weighted Average Life to Maturity of the Securities (the issuance of such subordinated securities to be consented to by the holders of at least a majority of the outstanding amount of Senior Indebtedness consisting of each class of Designated Senior Indebtedness then outstanding, which subordinated securities shall be issued in exchange for outstanding Securities or to pay interest accrued on outstanding Securities)) with respect to any Obligations on the Securities or to acquire any of the Securities for cash or property or otherwise. Notwithstanding anything herein to the contrary, in no event will a Blockage Period extend beyond 180 days from the date the payment on the Securities was due and only one such Blockage Period may be commenced within any 360 consecutive days. For all purposes of this Section 10.02(a), no event of default which existed or was continuing on the date of the commencement of any Blockage Period with respect to the Designated Senior Indebtedness initiating such Blockage Period shall be, or be made, the basis for the commencement of a second Blockage Period by the Representative of such Designated Senior Indebtedness, whether or not within a period of 360 consecutive days, unless such event of default shall have been cured or waived for a period of not less than 90 consecutive days (it being acknowledged that any subsequent action, or any breach of any financial covenants for a period commencing after the date of commencement of such Blockage Period that, in either case, would give rise to an event of default pursuant to any provision under which an event of default previously existed or was continuing shall constitute a new event of default for this purpose). (b) In the event that, notwithstanding the foregoing, any payment shall be received by the Trustee or any Holder when such payment is prohibited by Section 10.02(a), such payment shall be held in trust for the benefit of, and shall be paid over or delivered to, the holders of Senior Indebtedness (pro rata to such holders on the basis of the respective amount of Senior Indebtedness held by such holders) or their respective Representatives, as their respective interests may appear. The Trustee shall be entitled to rely on information regarding amounts then due and owing on the Senior Indebtedness, if any, received from the holders of Senior Indebtedness (or their Representatives) or, if such information is not received from such holders or their Representatives, from the Company and only amounts included in the information provided to the Trustee shall be paid to the holders of Senior Indebtedness. Nothing contained in this Article Ten shall limit the 80 81 right of the Trustee or the Holders of Securities to take any action to accelerate the maturity of the Securities pursuant to Section 6.02 or to pursue any rights or remedies hereunder; provided that all Senior Indebtedness thereafter due or declared to be due shall first be paid in full in cash or Cash Equivalents before the Holders are entitled to receive any payment with respect to Obligations on the Securities. C. Payment Over of Proceeds upon Dissolution, Etc. (a) Upon any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to creditors upon any liquidation, dissolution, winding-up, reorganization, assignment for the benefit of creditors or marshalling of assets of the Company or in a bankruptcy, reorganization, insolvency, receivership or other similar proceeding relating to the Company or its property, whether voluntary or involuntary, all Obligations due or to become due upon all Senior Indebtedness shall first be paid in full in cash or Cash Equivalents, or such payment duly provided for to the satisfaction of the holders of the Senior Indebtedness, before any payment or distribution of any kind or character is made on account of any Obligations on the Securities, or for the acquisition of any of the Securities for cash or property or otherwise. Upon any such dissolution, winding-up, liquidation, reorganization, receivership or similar proceeding, any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to which the Holders of the Securities or the Trustee under this Indenture would be entitled (other than any payments of fees and expenses of the Trustee and any indemnity made under Section 7.07), except for the provisions hereof, shall be paid by the Company or by any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person making such payment or distribution, or by the Holders of the Securities or by the Trustee under this Indenture if received by them, directly to the holders of Senior Indebtedness (pro rata to such holders on the basis of the respective amounts of Senior Indebtedness held by such holders) or their respective Representatives, or to the trustee or trustees under any indenture pursuant to which any of such Senior Indebtedness may have been issued, as their respective interests may appear, for application to the payment of Senior Indebtedness remaining unpaid until all such Senior Indebtedness has been paid in full in cash or Cash Equivalents after giving effect to any concurrent payment, distribution or provision therefor to or for the holders of Senior Indebtedness. (b) To the extent any payment of Senior Indebtedness (whether by or on behalf of the Company, as proceeds of security or enforcement of any right of setoff or otherwise) is declared to be fraudulent or preferential, set aside or 81 82 required to be paid to any receiver, trustee in bankruptcy, liquidating trustee, agent or other similar Person under any bankruptcy, insolvency, receivership, fraudulent conveyance or similar law, then, if such payment is recovered by, or paid over to, such receiver, trustee in bankruptcy, liquidating trustee, agent or other similar Person, the Senior Indebtedness or part thereof originally intended to be satisfied shall be deemed to be reinstated and outstanding as if such payment had not occurred. (c) In the event that, notwithstanding the foregoing, any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities, shall be received by any Holder when such payment or distribution is prohibited by Section 10.03(a), such payment or distribution shall be held in trust for the benefit of, and shall be paid over or delivered to, the holders of Senior Indebtedness (pro rata to such holders on the basis of the respective amount of Senior Indebtedness held by such holders) or their respective Representatives, or to the trustee or trustees under any indenture pursuant to which any of such Senior Indebtedness may have been issued, as their respective interests may appear, for application to the payment of Senior Indebtedness remaining unpaid until all such Senior Indebtedness has been paid in full in cash or Cash Equivalents, after giving effect to any concurrent payment, distribution or provision therefor to or for the holders of such Senior Indebtedness. (d) The consolidation of the Company with, or the merger of the Company with or into, another corporation or the liquidation or dissolution of the Company following the conveyance or transfer of all or substantially all of its assets, to another corporation upon the terms and conditions provided in Article Five and as long as permitted under the terms of the Senior Indebtedness shall not be deemed a dissolution, winding-up, liquidation or reorganization for the purposes of this Section if such other corporation shall, as a part of such consolidation, merger, conveyance or transfer, assume the Company's obligations hereunder in accordance with Article Five. D. Payments May Be Paid Prior to Dissolution. Nothing contained in this Article Ten or elsewhere in this Indenture shall prevent (i) the Company, except under the conditions described in Sections 10.02 and 10.03, from making payments at any time for the purpose of making payments of principal of and interest on the Securities, or from depositing with the Trustee any moneys for such payments, or (ii) in the absence of actual knowledge by the Trustee that a given payment would be prohibited by Section 10.02 or 10.03, the application by the Trustee of any moneys deposited with it for the purpose of making such payments of principal of, and interest on, the 82 83 Securities to the Holders entitled thereto unless at least one Business Day prior to the date upon which such payment would otherwise become due and payable, the Trustee shall have received the written notice provided for in Section 10.02(a) or in Section 10.07. The Company shall give prompt written notice to the Trustee of any dissolution, winding-up, liquidation or reorganization of the Company. E. Subrogation. Subject to the payment in full in cash or Cash Equivalents of all Senior Indebtedness, the Holders of the Securities shall be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, property or securities of the Company applicable to the Senior Indebtedness until the Securities shall be paid in full; and, for the purposes of such subrogation, no such payments or distributions to the holders of the Senior Indebtedness by or on behalf of the Company or by or on behalf of the Holders by virtue of this Article Ten which otherwise would have been made to the Holders shall, as between the Company and the Holders of the Securities, be deemed to be a payment by the Company to or on account of the Senior Indebtedness, it being understood that the provisions of this Article Ten are and are intended solely for the purpose of defining the relative rights of the Holders of the Securities, on the one hand, and the holders of the Senior Indebtedness, on the other hand. F. Obligations of the Company Unconditional. Nothing contained in this Article Ten or elsewhere in this Indenture or in the Securities is intended to or shall impair, as among the Company, its creditors other than the holders of Senior Indebtedness, and the Holders of the Securities, the obligation of the Company, which is absolute and unconditional, to pay to the Holders of the Securities the principal of and any interest on the Securities as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the Holders of the Securities and creditors of the Company other than the holders of the Senior Indebtedness, nor shall anything herein or therein prevent the Holder of any Security or the Trustee on its behalf from exercising all remedies otherwise permitted by applicable law upon default under this Indenture, subject to the rights, if any, in respect of cash, property or securities of the Company received upon the exercise of any such remedy. G. Notice to Trustee. The Company shall give prompt written notice to the Trustee of any fact known to the Company which would prohibit 83 84 the making of any payment to or by the Trustee in respect of the Securities pursuant to the provisions of this Article Ten. Regardless of anything to the contrary contained in this Article Ten or elsewhere in this Indenture, the Trustee shall not be charged with knowledge of the existence of any default or event of default with respect to any Senior Indebtedness or of any other facts which would prohibit the making of any payment to or by the Trustee unless and until the Trust Officer of the Trustee shall have received notice in writing from the Company, or from a holder of Senior Indebtedness or a Representative therefor, and, prior to the receipt of any such written notice, the Trustee shall be entitled to assume (in the absence of actual knowledge to the contrary) that no such facts exist. In the event that the Trustee determines in good faith that any evidence is required with respect to the right of any Person as a holder of Senior Indebtedness to participate in any payment or distribution pursuant to this Article Ten, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amounts of Senior Indebtedness held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article Ten, and if such evidence is not furnished the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. H. Reliance on Judicial Order or Certificate of Liquidating Agent. Upon any payment or distribution of assets of the Company referred to in this Article Ten, the Trustee, subject to the provisions of Article Seven hereof, and the Holders of the Securities shall be entitled to rely upon any order or decree made by any court of competent jurisdiction in which bankruptcy, dissolution, winding-up, liquidation or reorganization proceedings are pending, or upon a certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent or other person making such payment or distribution, delivered to the Trustee or the Holders of the Securities, for the purpose of ascertaining the Persons entitled to participate in such distribution, the holders of the Senior Indebtedness and other Indebtedness of the Company, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article Ten. I. Trustee's Relation to Senior Indebtedness. The Trustee and any agent of the Company or the Trustee shall be entitled to all the rights set forth in this Article Ten with respect to any Senior Indebtedness which may 84 85 at any time be held by it in its individual or any other capacity to the same extent as any other holder of Senior Indebtedness and nothing in this Indenture shall deprive the Trustee or any such agent of any of its rights as such holder. With respect to the holders of Senior Indebtedness, the Trustee undertakes to perform or to observe only such of its duties, covenants, responsibilities and obligations as are specifically set forth in this Article Ten, and no implied duties, covenants, responsibilities or obligations with respect to the holders of Senior Indebtedness shall be read into this Indenture against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness. Whenever a distribution is to be made or a notice given to holders or owners of Senior Indebtedness, the distribution may be made and the notice may be given to their Representative, if any. J. Subordination Rights Not Impaired by Acts or Omissions of the Company or Holders of Senior Indebtedness. No right of any present or future holders of any Senior Indebtedness to enforce subordination as provided herein shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms of this Indenture, regardless of any knowledge thereof which any such holder may have or otherwise be charged with. Without in any way limiting the generality of the foregoing paragraph, the holders of Senior Indebtedness may, at any time and from time to time, without the consent of or notice to the Trustee, without incurring responsibility to the Trustee or the Holders of the Securities and without impairing or releasing the subordination provided in this Article Ten or the obligations hereunder of the Holders of the Securities to the holders of the Senior Indebtedness, do any one or more of the following: (i) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, Senior Indebtedness, or otherwise amend or supplement in any manner Senior Indebtedness, or any instrument evidencing the same or any agreement under which Senior Indebtedness is outstanding; (ii) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing Senior Indebtedness; (iii) release any Person liable in any manner for the payment or collection of Senior Indebtedness; and (iv) exercise or refrain from exercising any rights against the Company and any other Person. 85 86 K. Securityholders Authorize Trustee To Effectuate Subordination of Securities. Each Holder of Securities by its acceptance of such Security authorizes and expressly directs the Trustee on such Holder's behalf to take such action as may be necessary or appropriate to effectuate, as between the holders of Senior Indebtedness and the Holders of Securities, the subordination provided in this Article Ten, and appoints the Trustee such Holder's attorney-in-fact to act for and on behalf of each such Holder of Securities for such purposes, including, in the event of any dissolution, winding-up, liquidation or reorganization of the Company (whether in bankruptcy, insolvency, receivership, reorganization or similar proceedings or upon an assignment for the benefit of creditors or otherwise) tending towards liquidation of the business and assets of the Company, the filing of a claim for the unpaid balance of its Securities and accrued interest in the form required in those proceedings. L. This Article Ten Not To Prevent Events of Default. The failure to make a payment on account of principal of or interest on the Securities by reason of any provision of this Article Ten will not be construed as preventing the occurrence of an Event of Default. M. Trustee's Compensation Not Prejudiced. Nothing in this Article Ten will apply to amounts due to the Trustee pursuant to other sections in this Indenture. ARTICLE TEN A GUARANTEES OF THE SECURITIES SECTION 10A.01. Guarantees. Subject to the provisions of this Article Ten A, each Guarantor hereby jointly and severally unconditionally guarantees to each Holder of a Security authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of this Indenture, the Securities or the obligations of the Company or any other Guarantors to the Holders or the Trustee hereunder, that: (a) the principal of and interest on the Securities will be duly and punctually paid in full when due, whether at maturity, by acceleration or otherwise, and interest on the overdue principal and (to the extent permitted by law) interest, if any, on the Securities and all other Obligations 86 87 on the Securities will be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and (b) in case of any extension of time of payment or renewal of any Securities or any of such other Obligations on the Securities, the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at final stated maturity, by acceleration or otherwise. Failing payment when due of any amount so guaranteed, for whatever reason, each Guarantor will be obligated to pay the same immediately. An Event of Default under this Indenture or the Securities shall constitute an event of default under the Guarantees, and shall entitle the Holders of Securities to accelerate the obligations of the Guarantors hereunder in the same manner and to the same extent as the Obligations of the Company on the Securities. Each of the Guarantors hereby agrees that its obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Securities or this Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Securities with respect to any provisions hereof or thereof, any release of any other Guarantor, the recovery of any judgment against the Company, any action to enforce the same, whether or not a Guarantee is affixed to any particular Security, or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor. Each of the Guarantors hereby waives the benefit of diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands whatsoever and covenants that its Guarantee will not be discharged except by complete performance of the obligations contained in the Securities, this Indenture and the Guarantee. If any Holder or the Trustee is required by any court or otherwise to return to the Company or to any Guarantor, or any custodian, trustee, liquidator or other similar official acting in relation to the Company or such Guarantor, any amount paid by the Company or such Guarantor to the Trustee or such Holder, the Guarantees, to the extent theretofore discharged, shall be reinstated in full force and effect. Each Guarantor further agrees that, as between it, on the one hand, and the Holders of Securities and the Trustee, on the other hand, (a) subject to this Article Ten A, the maturity of the obligations guaranteed hereby may be accelerated as provided in Section 6.02 for the purposes of the Guarantees, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (b) in the event of any acceleration of such obligations as provided in Section 6.02, such obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purpose of the Guarantees. 87 88 The Guarantees shall remain in full force and effect and continue to be effective should any petition be filed by or against the Company for liquidation or reorganization, should the Company become insolvent or make an assignment for the benefit of creditors or should a receiver or trustee be appointed for all or any significant part of the Company's assets, and shall, to the fullest extent permitted by law, continue to be effective or be reinstated, as the case may be, if at any time payment and performance of the Securities are, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee on the Securities, whether as a "voidable preference," "fraudulent transfer" or otherwise, all as though such payment or performance had not been made. In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Securities shall, to the fullest extent permitted by law, be reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or returned. No stockholder, officer, director, employer or incorporator, past, present or future, of any Guarantor, as such, shall have any personal liability under the Guarantees by reason of his, her or its status as such stockholder, officer, director, employer or incorporator. The Guarantors shall have the right to seek contribution from any non- paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Guarantees. Each Guarantor, and by its acceptance hereof each Holder, hereby confirms that it is the intention of all such parties that in no event shall any Guarantor's obligations under its Guarantee be subject to avoidance under any applicable fraudulent conveyance or similar law of any relevant jurisdiction. Therefore, in the event that the Guarantees would, but for this sentence, be subject to avoidance, then the liability of the Guarantors under the Guarantees shall be reduced to the extent necessary such that such Guarantees shall not be subject to avoidance under the applicable fraudulent conveyance or similar law. Subject to the preceding limitation on liability, the Guarantee of each Guarantor constitutes a guarantee of payment in full when due and not merely a guarantee of collectability. SECTION 10A.02. Execution and Delivery of the Guarantees. To further evidence the Guarantees set forth in Section 10A.01, each Guarantor hereby agrees that a notation of such Guarantees, substantially in the form included in Exhibit A hereto, shall be endorsed on each Security authenticated and delivered by the Trustee. The validity and enforceability 88 89 of any Guarantee shall not be affected by the fact that it is not affixed to any particular Security. Each of the Guarantors hereby agrees that its Guarantee set forth in Section 10A.01 shall remain in full force and effect notwithstanding any failure to endorse on each Security a notation of such Guarantee. If an Officer of a Guarantor whose signature is on this Indenture or a Security no longer holds that office at the time the Trustee authenticates such Security or at any time thereafter, such Guarantor's Guarantee of such Security shall be valid nevertheless. The delivery of any Security by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of any Guarantee set forth in this Indenture on behalf of the Guarantor. SECTION 10A.03. Additional Guarantors. Any Person may become a Guarantor by executing and delivering to the Trustee (a) a supplemental indenture, in form and substance satisfactory to the Trustee, which subjects such Person to the provisions of this Indenture as a Guarantor, and (b) an Opinion of Counsel to the effect that such supplemental indenture has been duly authorized and executed by such Person and constitutes the legal, valid, binding and enforceable obligation of such Person (subject to such customary exceptions concerning fraudulent conveyance laws, creditors' rights and equitable principles as may be acceptable to the Trustee in its discretion). SECTION 10A.04. Limitation of Guarantors' Liability. The obligations of each Guarantor are limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Guarantor (including, without limitation, any guarantees under the Credit Agreement) and after giving effect to any collections from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under its Guarantee or pursuant to Section 10A.06, result in the obligations of such Guarantor under the Guarantees not constituting a fraudulent conveyance or fraudulent transfer under federal or state law. Each Guarantor that makes a payment or distribution under the Guarantees shall be entitled to a contribution from each other Guarantor in a pro rata amount based on the Adjusted Net Assets of each Guarantor. 89 90 SECTION 10A.05. Guarantors May Consolidate, etc., on Certain Terms. (a) Nothing contained in this Indenture or in any of the Securities shall prevent any consolidation or merger of a Guarantor with or into the Company or another Guarantor or shall prevent any sale or conveyance of the property of a Guarantor, as an entirety or substantially as an entirety, to the Company or another Guarantor. Upon any such consolidation, merger, sale or conveyance, the Guarantee given by such Guarantor shall no longer have any force or effect. (b) Nothing contained in this Indenture or in any of the Securities shall prevent any consolidation or merger of a Guarantor with or into a Person (provided such Person is a corporation, partnership or trust) other than the Company or another Guarantor or shall prevent any sale or conveyance of the property of a Guarantor as an entirety or substantially as an entirety to any such Person (whether or not an Affiliate of the Guarantor). Upon the sale or disposition of a Guarantor (or all or substantially all of its assets) to a Person which is not a Subsidiary of the Company, which is otherwise in compliance with this Indenture (including Section 4.16), such Guarantor shall be deemed released from all its obligations under this Indenture and its Guarantee and such Guarantee shall terminate; provided, however, that any such termination shall occur only to the extent that all obligations of such Guarantor under the Credit Agreement and all its guarantees of, and under all of its pledges of assets or other security interests which secure, Indebtedness of the Company shall also terminate upon such release, sale or transfer. (c) The Trustee shall, at the Company's expense, deliver an appropriate instrument evidencing such release upon receipt of a request by the Company accompanied by an Officers' Certificate certifying as to the compliance with this Section 10A.05. Any Guarantor not so released remains liable for the full amount of principal of an interest on the Securities as provided in this Article Ten A. SECTION 10A.06. Contribution. In order to provide for just and equitable contribution among the Guarantors, the Guarantors agree, inter se, that in the event any payment or distribution is made by any Guarantor (a "Funding Guarantor") under the Guarantees, such Funding Guarantor shall be entitled to a contribution from all other Guarantors in a pro rata amount based on the Adjusted Net Assets of each Guarantor (including the Funding Guarantor) for all payments, damages and expenses incurred by that Funding Guarantor in discharging the Company obligations with respect to the Securities or any other Guarantor's obligations with respect to the Guarantees; provided that such Funding Guarantor's contribution right with respect to any such Guarantor shall be subordinated in right of payment to such Guarantor's 90 91 Guarantor Senior Indebtedness on the same basis as its Guarantee is subordinated to Guarantor Senior Indebtedness pursuant to Article Ten B. SECTION 10A.07. Waiver of Subrogation. Each Guarantor hereby irrevocably waives any claim or other rights which it may now or hereafter acquire against the Company that arise from the existence, payment, performance or enforcement of such Guarantor's obligations under the Guarantees and this Indenture, including, without limitation, any right of subrogation, reimbursement, exoneration or indemnification, and any right to participate in any claim or remedy of any Holder of Securities against the Company, whether or not such claim, remedy or right arises in equity, or under contract, statute or common law, including, without limitation, the right to take or receive from the Company, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim or other rights. If any amount shall be paid to any Guarantor in violation of the preceding sentence and the Securities shall not have been paid in full, such amount shall have been deemed to have been paid to such Guarantor for the benefit of, and held in trust for the benefit of, the Holders of the Securities, and shall, subject to the provisions of Article Ten B, forthwith be paid to the Trustee for the benefit of such Holders to be credited and applied upon the Securities, whether matured or unmatured, in accordance with the terms of this Indenture. Each Guarantor acknowledges that it will receive direct or indirect benefits from the financing arrangements contemplated by this Indenture and that the waiver set forth in this Section 10A.07 is knowingly made in contemplation of such benefits. ARTICLE TEN B SUBORDINATION OF GUARANTEES SECTION 10B.01. Guarantee Obligations Subordinated to Guarantor Senior Indebtedness. Each Guarantor covenants and agrees, and the Trustee and each Holder of the Securities, by its acceptance thereof, likewise covenants and agrees, that all Guarantees shall be issued subject to the provisions of this Article Ten B; and the Trustee and each Person holding any Guarantee, whether upon original issue or upon transfer, assignment or exchange thereof, accepts and agrees that the payment of all Obligations on the Securities pursuant to the Guarantees (except for the 91 92 payment of fees and expenses of the Trustee under Section 7.07) made by or on behalf of such Guarantor shall, to the extent and in the manner herein set forth, be subordinated and junior in right of payment to the prior payment in full in cash or Cash Equivalents (or such payment shall be duly provided for to the satisfaction of the holders of the Guarantor Senior Indebtedness of any Guarantor) of all existing and future Obligations on the Guarantor Senior Indebtedness of such Guarantor; that the subordination is for the benefit of, and shall be enforceable directly by, the holders of Guarantor Senior Indebtedness of any Guarantor, and that each holder of Guarantor Senior Indebtedness of any Guarantor whether now outstanding or hereafter created, incurred, assumed or guaranteed shall be deemed to have acquired Guarantor Senior Indebtedness of any Guarantor in reliance upon the covenants and provisions contained in this Indenture and the Guarantees. This Section 10B.01 and the following Sections 10B.02 through 10B.15 of this Article Ten B shall constitute a continuing offer to all Persons who, in reliance upon such provisions, become holders of, or continue to hold, Guarantor Senior Indebtedness of any Guarantor and, to the extent set forth in Section 10B.02, holders of Designated Guarantor Senior Indebtedness; and such provisions are made for the benefit of the holders of Guarantor Senior Indebtedness of each Guarantor and, to the extent set forth in 10B.02, holders of Designated Guarantor Senior Indebtedness; and such holders (to such extent) are made obligees hereunder and they or each of them may enforce such provisions. SECTION 10B.02. No Payment on Guarantees in Certain Circumstances. (a) If any default occurs and is continuing in the payment when due, whether at maturity, upon any redemption, by declaration or otherwise, of any principal of, interest on or any other amounts owing with respect to any Guarantor Senior Indebtedness, no payment of any kind or character (except (i) in Qualified Capital Stock issued by the Company to pay interest on the Securities or issued in exchange for the Securities, (ii) in securities substantially identical to the Securities issued by the Company and guaranteed by the Guarantors on the same basis as provided in the Guarantees in payment of interest accrued on the Securities or (iii) in securities issued by the Company and guaranteed by the Guarantors which securities and guarantees thereof are subordinated to the Guarantor Senior Indebtedness at least to the same extent as the Guarantees and having a Weighted Average Life to Maturity at least equal to the remaining Weighted Average Life to Maturity of the Securities (the issuance of any such guarantee in respect of such subordinated securities to be consented to by the holders of at least a majority of the outstanding amount of 92 93 Guarantor Senior Indebtedness consisting of each class of Designated Guarantor Senior Indebtedness then outstanding, which subordinated securities shall be issued in exchange for outstanding Securities or to pay interest accrued on outstanding Securities)) shall be made by any Guarantor or any other Person on behalf of such Guarantor with respect to any Obligations on the Securities or under the Guarantees or to acquire any of the Securities for cash or property or otherwise. In addition, if any other event of default occurs and is continuing (or if such an event of default would occur upon any payment with respect to the Securities or would arise upon the passage of time as a result of such payment) with respect to any Designated Guarantor Senior Indebtedness (as such event of default is defined in the instrument creating or evidencing such Designated Guarantor Senior Indebtedness) and such event of default permits the holders of such Designated Guarantor Senior Indebtedness then outstanding to accelerate the maturity thereof and if the Representative for the respective issue of Designated Guarantor Senior Indebtedness gives a Default Notice to the Company, the Guarantors and the Trustee, then, unless and until all events of default have been cured or waived or have ceased to exist or the Company, the Guarantors and the Trustee receive notice from the Representative for the respective issue of Designated Guarantor Senior Indebtedness terminating the Blockage Period, neither the Guarantors nor any other Person on behalf of the Guarantors shall make any payment of any kind or character (except (i) in Qualified Capital Stock issued by the Company to pay interest on the Securities or issued in exchange for the Securities, (ii) in securities substantially identical to the Securities issued by the Company and guaranteed by the Guarantors on the same basis as provided in the Guarantees in payment of interest accrued thereon or (iii) in securities issued by the Company and guaranteed by the Guarantors which securities and guarantees thereof are subordinated to the Guarantor Senior Indebtedness at least to the same extent as the Guarantees and having a Weighted Average Life to Maturity at least equal to the remaining Weighted Average Life to Maturity of the Securities (the issuance of any such guarantee in respect of such subordinated securities to be consented to by the holders of at least a majority of the outstanding amount of Guarantor Senior Indebtedness consisting of each class of Designated Guarantor Senior Indebtedness then outstanding, which subordinated securities shall be issued in exchange for outstanding Securities or to pay interest accrued on outstanding Securities) with respect to any Obligations of a Guarantor on the Securities or under the Guarantees or to acquire any of the Securities for cash or property or otherwise. Notwithstanding anything herein to the contrary, in no event will a Blockage Period extend beyond 180 days from the date the payment on the Securities was due and only one such Blockage Period may be commenced within any 360 consecutive days. For all purposes of this Section 10B.02(a), no event of default which existed or 93 94 was continuing on the date of the commencement of any Blockage Period with respect to the Designated Guarantor Senior Indebtedness initiating such Blockage Period shall be, or be made, the basis for the commencement of a second Blockage Period by the Representative of such Designated Guarantor Senior Indebtedness, whether or not within a period of 360 consecutive days, unless such event of default shall have been cured or waived for a period of not less than 90 consecutive days (it being acknowledged that any subsequent action, or any breach of any financial covenants for a period commencing after the date of commencement of such Blockage Period that in either case, would give rise to an event of default pursuant to any provision under which an event of default previously existed or was continuing shall constitute a new event of default for this purpose). (b) In the event that, notwithstanding the foregoing, any payment shall be received by the Trustee or any Holder of a Guarantee when such payment is prohibited by Section 10B.02(a), such payment shall be held in trust for the benefit of, and shall be paid over or delivered to, the holders of Guarantor Senior Indebtedness (pro rata to such holders on the basis of the respective amounts of Guarantor Senior Indebtedness held by such holders) or their respective Representatives, as their respective interests may appear. The Trustee shall be entitled to rely on information regarding amounts then due and owing on the Guarantor Senior Indebtedness, if any, received from the holders of Guarantor Senior Indebtedness (or their Representatives) or, if such information is not received from such holders or their Representatives, from the Company or the Guarantors and only amounts included in the information provided to the Trustee shall be paid to the holders of Guarantor Senior Indebtedness. Nothing contained in this Article Ten B shall limit the right of the Trustee or the Holders of Securities to take any action to accelerate the maturity of the Securities pursuant to Section 6.02 or to pursue any rights or remedies hereunder; provided that all Guarantor Senior Indebtedness thereafter due or declared to be due shall first be paid in full in cash or Cash Equivalents before the Holders are entitled to receive any payment with respect to Obligations on the Guarantees. SECTION 10B.03. Payment Over of Proceeds upon Dissolution, Etc. (a) Upon any payment or distribution of assets of any Guarantor of any kind or character, whether in cash, property or securities, to creditors upon any liquidation, dissolution, winding-up, reorganization, assignment for the benefit of creditors or marshalling of assets of any Guarantor or in a bankruptcy, reorganization, insolvency, receivership or other 94 95 similar proceeding relating to any Guarantor or its property, whether voluntary or involuntary, all Obligations due or to become due upon all Guarantor Senior Indebtedness shall first be paid in full in cash or Cash Equivalents, or such payment duly provided for to the satisfaction of the holders of the Guarantor Senior Indebtedness, before any payment or distribution of any kind or character is made on account of any Obligations of a Guarantor on the Guarantees, or for the acquisition of any of the Securities for cash or property or otherwise. Upon any such dissolution, winding-up, liquidation, reorganization, receivership or similar proceeding, any payment, or distribution of assets of any Guarantor of any kind or character, whether in cash, property or securities, to which the Holders of the Guarantees or the Trustee under this Indenture would be entitled, except for the provisions hereof, shall be paid by the Guarantors or by any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person making such payment or distribution, or by the Holders of the Guarantees or by the Trustee under this Indenture if received by them, directly to the holders of Guarantor Senior Indebtedness (pro rata to such holders on the basis of the respective amounts of Guarantor Senior Indebtedness held by such holders) or their respective Representatives, or to the trustee or trustees under any indenture pursuant to which any of such Guarantor Senior Indebtedness may have been issued, as their respective interests may appear, for application to the payment of Guarantor Senior Indebtedness remaining unpaid until all such Guarantor Senior Indebtedness has been paid in full in cash or Cash Equivalents after giving effect to any concurrent payment, distribution or provision therefor to or for the holders of Guarantor Senior Indebtedness. (b) To the extent any payment of Guarantor Senior Indebtedness (whether by or on behalf of a Guarantor, as proceeds of security or enforcement of any right of setoff or otherwise) is declared to be fraudulent or preferential, set aside or required to be paid to any receiver, trustee in bankruptcy, liquidating trustee, agent or other similar Person under any bankruptcy, insolvency, receivership, fraudulent conveyance or similar law, then, if such payment is recovered by, or paid over to, such receiver, trustee in bankruptcy, liquidating trustee, agent or other similar Person, the Guarantor Senior Indebtedness or part thereof originally intended to be satisfied shall be deemed to be reinstated and outstanding as if such payment had not occurred. (c) In the event that, notwithstanding the foregoing, any payment or distribution of assets of a Guarantor of any kind or character, whether in cash, property or securities, shall be received by any Holder when such payment or distribution is prohibited by Section 10B.03(a), such payment or distribution shall be held in trust for the benefit of, and shall 95 96 be paid over or delivered to, the holders of Guarantor Senior Indebtedness (pro rata to such holders on the basis of the respective amount of Guarantor Senior Indebtedness held by such holders) or their respective Representatives, or to the trustee or trustees under any indenture pursuant to which any of such Guarantor Senior Indebtedness may have been issued, as their respective interests may appear, for application to the payment of Guarantor Senior Indebtedness remaining unpaid until all such Guarantor Senior Indebtedness has been paid in full in cash or Cash Equivalents, after giving effect to any concurrent payment, distribution or provision therefor to or for the holders of such Guarantor Senior Indebtedness. (d) The consolidation of any Guarantor with, or the merger of any Guarantor with or into, another corporation or the liquidation or dissolution of any Guarantor following the conveyance or transfer of all or substantially all of its assets to another corporation upon the terms and conditions provided in Section 10A.05 as if the Guarantor were the Company and as long as permitted under the terms of the Guarantor Senior Indebtedness shall not be deemed a dissolution, winding-up, liquidation or reorganization for the purposes of this Section 10B.03 if such other corporation shall, as a part of such consolidation, merger, conveyance or transfer, assume such Guarantor's obligations hereunder in accordance with Section 10A.05 as if the Guarantor were the Company. SECTION 10B.04. Payments May Be Paid Prior to Dissolution. Nothing contained in this Article Ten B or elsewhere in this Indenture shall prevent (i) a Guarantor, except under the conditions described in Sections 10B.01 and 10B.02, from making payments at any time for the purpose of making payments of principal of and interest on the Securities, or from depositing with the Trustee any moneys for such payments, or (ii) in the absence of actual knowledge by the Trustee that a given payment would be prohibited by Sections 10B.01 and 10B.02, the application by the Trustee of any moneys deposited with it for the purpose of making such payments of principal of, and interest on, the Securities to the Holders entitled thereto unless, at least one Business Day prior to the date upon which such payment would otherwise become due and payable, the Trustee shall have actually received the written notice provided for in Section 10B.02(a) or in Section 10B.09. The Guarantor shall give prompt written notice to the Trustee of any dissolution, winding-up, liquidation or reorganization of any Guarantor. SECTION 10B.05. Subrogation. Subject to the payment in full in cash or Cash Equivalents of all Guarantor Senior Indebtedness, the Holders of the Guarantees shall be subrogated to the rights of the holders of 96 97 Guarantor Senior Indebtedness to receive payments or distributions of cash, property or securities of a Guarantor applicable to the Guarantor Senior Indebtedness until the Securities shall be paid in full; and, for the purposes of such subrogation, no such payments or distributions to the holders of the Guarantor Senior Indebtedness by or on behalf of any Guarantor or by or on behalf of the holders of the Guarantees by virtue of this Article Ten B which otherwise would have been made to such holders shall, as between such Guarantor and the holders of the Guarantees, be deemed to be a payment by such Guarantor to or on account of the Guarantor Senior Indebtedness. SECTION 10B.06. Guarantee Provisions Solely To Define Relative Rights. The subordination provisions of this Article Ten B are and are intended solely for the purpose of defining the relative rights of the Holders of the Securities on the one hand and the holders of Guarantor Senior Indebtedness of each Guarantor and, to the extent set forth in Section 10B.02, holders of Designated Guarantor Senior Indebtedness on the other hand. Nothing contained in this Article Ten B or elsewhere in this Indenture or in the Securities is intended to or shall (a) impair, as among each Guarantor, its creditors other than holders of its Guarantor Senior Indebtedness and the Holders of the Securities, the obligation of such Guarantor, which is absolute and unconditional, to make payments to the Holders in respect of its obligations under its Guarantee as and when the same shall become due and payable in accordance with their terms; or (b) affect the relative rights against such Guarantor of the Holders of the Securities and creditors of such Guarantor other than the holders of the Guarantor Senior Indebtedness of such Guarantor; or (c) prevent the Trustee or the Holder of any Security from exercising all remedies otherwise permitted by applicable law upon a Default or an Event of Default under this Indenture, subject to the rights, if any, under the subordination provisions of this Article Ten B of the holders of Guarantor Senior Indebtedness of the Guarantors hereunder and, to the extent set forth in Section 10B.02, holders of Designated Guarantor Senior Indebtedness on the other hand (1) in any case, proceeding, dissolution, liquidation or other winding-up, assignment for the benefit of creditors or other marshalling of assets and liabilities of the Guarantor referred to in Section 10B.03, to receive, pursuant to and in accordance with such Section, cash, property and securities otherwise payable or deliverable to the Trustee or such Holder, or (2) under the conditions specified in Section 10B.02, to prevent any payment prohibited by such Section or enforce their rights pursuant to Section 10B.02(c). The failure by any Guarantor to make a payment in respect of its obligations under this Guarantee by reason of 97 98 any provision of this Article Ten B shall not be construed as preventing the occurrence of a Default or an Event of Default hereunder. SECTION 10B.07. Trustee to Effectuate Subordination of Obligations Under the Guarantees. Each Holder of a Security by its acceptance of such Security authorizes and expressly directs the Trustee to take on behalf of such Holder of Securities such action as may be necessary or appropriate to effectuate as between the holders of Guarantor Senior Indebtedness and Holders of Guarantees, the subordination provided in this Article Ten B, and appoints the Trustee its attorney-in-fact to act for it and on its behalf for such purposes, including, in the event of any dissolution, winding-up, liquidation or reorganization of any Guarantor (whether in bankruptcy, insolvency, receivership, reorganization or similar proceedings or upon an assignment for the benefit of creditors or otherwise) tending towards liquidation of the business and assets of such Guarantor, the filing of a claim for the unpaid balance of its Guarantees and accrued interest in the form required in those proceedings. SECTION 10B.08. No Waiver of Guarantee Subordination Provisions. No right of any present or future holder of any Guarantor Senior Indebtedness of any Guarantor to enforce subordination as provided herein shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Company or any Guarantor or by any act or failure to act, in good faith, by any such holder, or by any non-compliance by the Company or any Guarantor with the terms of this Indenture, regardless of any knowledge thereof any such holder may have or otherwise be charged with. Without in any way limiting the generality of the foregoing paragraph, the holders of Guarantor Senior Indebtedness of any Guarantor may, at any time and from time to time, without the consent of or notice to the Trustee, without incurring responsibility to the Trustee or the Holders of the Securities and without impairing or releasing the subordination provided in this Article Ten B or the obligations hereunder of the Holders of the Guarantees to the holders of such Guarantor Senior Indebtedness, do any one or more of the following: (1) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, such Guarantor Senior Indebtedness or any Senior Indebtedness as to which such Guarantor Senior Indebtedness relates, or otherwise amend or supplement in any manner such Guarantor Senior Indebtedness or any Senior Indebtedness to which such Guarantor Senior Indebtedness relates; (2) sell, exchange, release or otherwise deal with any 98 99 property pledged, mortgaged or otherwise securing such Guarantor Senior Indebtedness or any Senior Indebtedness as to which such Guarantor Senior Indebtedness relates; (3) release any person liable in any manner for the collection or payment of such Guarantor Senior Indebtedness or any Senior Indebtedness as to which such Guarantor Senior Indebtedness relates; and (4) exercise or refrain from exercising any rights against such Guarantor and any other Person. SECTION 10B.09. Guarantors to Give Notice to Trustee. The Company and each Guarantor shall give prompt written notice to the Trustee of any fact known to such Guarantor which would prohibit the making of any payment to or by the Trustee in respect of the Securities pursuant to the provisions of this Article Ten B. Notwithstanding the subordination provisions of this Article Ten B or any other provision of this Indenture, the Trustee shall not be charged with knowledge of the existence of any default or event of default with respect to any Guarantor Senior Indebtedness or of any other facts which would prohibit the making of any payment to or by the Trustee unless and until the Trustee shall have received notice in writing from the Company, such Guarantor or from a holder of Guarantor Senior Indebtedness or a Representative therefor, and, prior to the receipt of any such written notice, the Trustee shall be entitled to assume (in the absence of actual knowledge to the contrary) that no such facts exist. In the event that the Trustee determines in good faith that any evidence is required with respect to the right of any Person as a holder of Guarantor Senior Indebtedness of any Guarantor to participate in any payment or distribution pursuant to this Article Ten B, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of Guarantor Senior Indebtedness of each Guarantor held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article Ten B, and if such evidence is not furnished the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. SECTION 10B.10. Reliance on Judicial Order or Certificate of Liquidating Agent Regarding Dissolution, etc., of Guarantors. Upon any payment or distribution of assets of a Guarantor referred to in this Article Ten B, the Trustee, subject to the provisions of Article Seven hereof, and the Holders shall be entitled to rely upon any order or decree entered by any court of competent jurisdiction in which such bankruptcy, liquidation, reorganization, dissolution or winding-up proceeding 99 100 are pending or, upon a certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent or other person making such payment or distribution, delivered to the Trustee or to the Holders of the Guarantees, for the purpose of ascertaining the Persons entitled to participate in such payment or distribution, the holders of Guarantor Senior Indebtedness of such Guarantor and other Indebtedness of such Guarantor, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article Ten B. SECTION 10B.11. Rights of Trustee as a Holder of Guarantor Senior Indebtedness; Preservation of Trustee's Rights. The Trustee in its individual capacity shall be entitled to all the rights set forth in this Article Ten B with respect to any Guarantor Senior Indebtedness of any Guarantor which may at any time be held by the Trustee, to the same extent as any other holder of such Guarantor Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of its rights as such holder. Nothing in this Article Ten B shall apply to claims of, or payments to, the Trustee under or pursuant to Section 7.07. SECTION 10B.12. No Suspension of Remedies. Nothing contained in this Article Ten B shall limit the right of the Trustee or the Holders of Securities to take any action to accelerate the maturity of the Securities pursuant to Article Six or to pursue any rights or remedies hereunder or under applicable law, subject to the rights, if any, under this Article Ten B of the holders, from time to time, of Guarantor Senior Indebtedness of the Guarantors. SECTION 10B.13. Trustee's Relation to Guarantor Senior Indebtedness. The Trustee and any agent of the Guarantor or the Trustee shall be entitled to all the rights set forth in this Article Ten B with respect to any Guarantor Senior Indebtedness which may at any time be held by it in its individual or any other capacity to the same extent as any other holder of the Guarantor Senior Indebtedness and nothing in this Indenture shall deprive the Trustee or any such agent of any of its rights as such holder. With respect to the holders of Guarantor Senior Indebtedness, the Trustee undertakes to perform or to observe only such of its duties, covenants, responsibilities and obligations as are specifically set forth in this Article Ten B, and no implied covenants or obligations with respect to the 100 101 holders of Guarantor Senior Indebtedness shall be read into this Indenture against the Trustee. The Trustee shall not be deemed to owe any fiduciary or other duty to the holders of Guarantor Senior Indebtedness. Whenever a distribution is to be made or a notice given to holders or owners of Guarantor Senior Indebtedness, the distribution may be made and the notice may be given to their Representative, if any. SECTION 10B.14. Subordination Rights Not Impaired by Acts or Omissions of the Guarantors or Holders of Guarantor Senior Indebtedness. No right of any present or future holders of any Guarantor Senior Indebtedness to enforce subordination as provided herein shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Guarantors or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Guarantors with the terms of this Indenture, regardless of any knowledge thereof which any such holder may have or otherwise be charged with. Without in any way limiting the generality of the foregoing paragraph, the holders of Guarantor Senior Indebtedness may, at any time and from time to time, without the consent of or notice to the Trustee, without incurring responsibility to the Trustee or the Holders of the Securities and without impairing or releasing the subordination provided in this Article Ten B or the obligations hereunder of the Holders of the Securities to the holders of the Guarantor Senior Indebtedness, do any one or more of the following: (i) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, Guarantor Senior Indebtedness, or otherwise amend or supplement in any manner Guarantor Senior Indebtedness, or any instrument evidencing the same or any agreement under which Guarantor Senior Indebtedness is outstanding; (ii) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing Guarantor Senior Indebtedness; (iii) release any Person liable in any manner for the payment or collection of Guarantor Senior Indebtedness; and (iv) exercise or refrain from exercising any rights against the Guarantors and any other Person. SECTION 10B.15. This Article Ten B Not To Prevent Events of Default. The failure to make a payment on account of principal of or interest on the Securities by reason of any provision of this Article Ten B will not be construed as preventing the occurrence of an Event of Default. 101 102 XI. MISCELLANEOUS A. TIA Controls. If any provision of this Indenture limits, qualifies, or conflicts with another provision which is required to be included in this Indenture by the TIA, the required provision shall control. B. Notices. Any notices or other communications required or permitted hereunder shall be in writing, and shall be sufficiently given if made by hand delivery, by telex, by telecopier or registered or certified mail, postage prepaid, return receipt requested, addressed as follows: if to the Company: 12655 North Central Expressway Dallas, TX 75243 Attention: Chief Financial Officer if to the Trustee: U.S. Trust Company of Texas, N.A. 2001 Ross Avenue Suite 2700 Dallas, Texas 75201 Attention: Corporate Trust Department The Company and the Trustee by written notice to each other may designate additional or different addresses for notices. Any notice or communication to the Company or the Trustee shall be deemed to have been given or made as of the date so delivered if personally delivered; when answered back, if telexed; when receipt is acknowledged, if faxed; and five (5) calendar days after mailing if sent by registered or certified mail, postage prepaid (except that a notice of change of address shall not be deemed to have been given until actually received by the addressee). Any notice or communication mailed to a Securityholder shall be mailed to him by first class mail or other equivalent means at his address as it appears on the registration books of the Registrar and shall be sufficiently given to him if so mailed within the time prescribed. 102 103 Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it. C. Communications by Holders with Other Holders. Securityholders may communicate pursuant to TIA Section 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar and any other Person shall have the protection of TIA Section 312(c). D. Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee: (1) an Officers' Certificate, in form and substance satisfactory to the Trustee, stating that, in the opinion of the signers, all conditions precedent to be performed by the Company, if any, provided for in this Indenture relating to the proposed action have been complied with; and (2) an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent to be performed by the Company, if any, provided for in this Indenture relating to the proposed action have been complied with. E. Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture, other than the Officers' Certificate required by Section 4.07, shall include: (1) a statement that the Person making such certificate or opinion has read such covenant or condition; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of such Person, he has made such examination or investigation as is reasonably necessary to enable him to express an 103 104 informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether or not, in the opinion of each such Person, such condition or covenant has been complied with. F. Rules by Trustee, Paying Agent, Registrar. The Trustee may make reasonable rules in accordance with the Trustee's customary practices for action by or at a meeting of Securityholders. The Paying Agent or Registrar may make reasonable rules for its functions. G. Legal Holidays. A "Legal Holiday" used with respect to a particular place of payment is a Saturday, a Sunday or a day on which banking institutions in New York, New York, or at such place of payment are not required to be open. If a payment date is a Legal Holiday at such place, payment may be made at such place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. H. Governing Law. THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS. I. No Adverse Interpretation of Other Agreements. This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or any of its Subsidiaries. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. J. No Recourse Against Others. A past, present or future director, officer, employee, stockholder or incorporator, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or this Indenture or for any claim based on, in respect of or by reason of such obligations or their creations. Each Securityholder by accepting a Security waives and releases all such liability. Such waiver and release are part of the consideration for the issuance of the Securities. K. Successors. All agreements of the Company in this Indenture and 104 105 the Securities shall bind its successors. All agreements of the Trustee in this Indenture shall bind its successors. L. Duplicate Originals. All parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together shall represent the same agreement. M. Severability. In case any one or more of the provisions in this Indenture or in the Securities shall be held invalid, illegal or unenforceable, in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions shall not in any way be affected or impaired thereby, it being intended that all of the provisions hereof shall be enforceable to the full extent permitted by law. 105 106 SIGNATURES IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of the date first written above. CHANCELLOR RADIO BROADCASTING COMPANY Attest: By: /s/ STEVEN DINETZ ----------------------------------- /s/ KATHRINE ELROD Name: Steven Dinetz - ------------------------- Title: President The Guarantors: TREFOIL COMMUNICATIONS, INC. Attest: By: /s/ STEVEN DINETZ ------------------------------------ /s/ KATHRINE ELROD Name: Steven Dinetz - ------------------------- Title: SHAMROCK BROADCASTING, INC. Attest: By: /s/ STEVEN DINETZ ------------------------------------ /s/ KATHRINE ELROD Name: Steven Dinetz - ------------------------- Title: SHAMROCK RADIO LICENSES, INC. Attest: By: /s/ STEVEN DINETZ ------------------------------------ /s/ KATHRINE ELROD Name: Steven Dinetz - ------------------------- Title: 106 107 SHAMROCK BROADCASTING OF TEXAS, INC. Attest: By: /s/ STEVEN DINETZ -------------------------------- /s/ KATHRINE ELROD Name: Steven Dinetz - ------------------------- Title: SHAMROCK BROADCASTING LICENSES OF DENVER, INC. Attest: By: /s/ STEVEN DINETZ -------------------------------- /s/ KATHRINE ELROD Name: Steven Dinetz - ------------------------- Title: CHANCELLOR BROADCASTING LICENSEE COMPANY Attest: By: /s/ STEVEN DINETZ -------------------------------- /s/ KATHRINE ELROD Name: Steven Dinetz - ------------------------- Title: U.S. TRUST COMPANY OF TEXAS, N.A., as Trustee Attest: By: /s/ STEVEN DINETZ -------------------------------- /s/ KATHRINE ELROD Name: Steven Dinetz - ------------------------- Title: 107 108 EXHIBIT A-1 CHANCELLOR RADIO BROADCASTING COMPANY 8 3/4% Senior Subordinated Notes due 2007 [FORM OF SERIES A SECURITY] THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO CHANCELLOR RADIO BROADCASTING COMPANY (THE "COMPANY") OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS SECURITY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE FOR THIS SECURITY), (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO ANOTHER EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT (IF AVAILABLE), OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS SECURITY WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY, IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE COMPANY SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. A-1-1 109 No. $ CHANCELLOR RADIO BROADCASTING COMPANY, a Delaware corporation (the "Company"), for value received, promises to pay to or registered assigns, the principal sum of Dollars, on June 15, 2007. Interest Payment Dates: June 15 and December 15 Record Dates: June 1 and December 1 Reference is made to the further provisions of this Security contained herein, which will for all purposes have the same effect as if set forth at this place. IN WITNESS WHEREOF, the Company has caused this Security to be signed manually or by facsimile by its duly authorized officers. CHANCELLOR RADIO BROADCASTING COMPANY By: ------------------------------------------ Name: Title: By: ------------------------------------------ Name: Title: A-1-2 110 Trustee's Certificate of Authentication This is one of the 8 3/4% Senior Subordinated Notes due 2007 referred to in the within-mentioned Indenture. Dated: U.S. TRUST COMPANY OF TEXAS, N.A., as Trustee By: ------------------------------------------- Authorized Signatory A-1-3 111 (REVERSE OF SECURITY) 8 3/4% Senior Subordinated Notes due 2007 1. Interest. CHANCELLOR RADIO BROADCASTING COMPANY, a Delaware corporation (the "Company"), promises to pay interest on the principal amount of this Security at the rate per annum shown above. Interest on the Securities will accrue from the most recent date on which interest has been paid or, if no interest has been paid, from June 24, 1997. The Company will pay interest semi-annually in arrears on each Interest Payment Date, commencing December 15, 1997. Interest will be computed on the basis of a 360-day year of twelve 30- day months. The Company shall pay interest on overdue principal and on overdue installments of interest from time to time on demand at the rate borne by the Securities to the extent lawful. 2. Method of Payment. The Company shall pay interest on the Securities (except defaulted interest) to the Persons who are the registered Holders at the close of business on the Record Date immediately preceding the Interest Payment Date even if the Securities are cancelled on registration of transfer or registration of exchange after such Record Date. Holders must surrender Securities to a Paying Agent to collect principal payments. The Company shall pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts ("U.S. Legal Tender"). However, the Company may pay principal and interest by its check payable in such U.S. Legal Tender. The Company may deliver any such interest payment to the Paying Agent or to a Holder at the Holder's registered address. 3. Paying Agent and Registrar. Initially, U.S. Trust Company of Texas, N.A. (the "Trustee") will act as Paying Agent and Registrar. The Company may change any Paying Agent, Registrar or co-Registrar without notice to the Holders. The Company or any of its Subsidiaries may, subject to certain exceptions, act as Registrar or co-Registrar. 4. Indenture and Guarantees. The Company issued the Securities under an Indenture, dated as of June 24, 1997 (the "Indenture"), among the Company, the Guarantors and the Trustee. This Security is one of a duly authorized issue of Securities of the Company designated as its 8 3/4% Senior Subordinated Notes due 2007 (the "Securities"), limited (except as otherwise provided in the Indenture) in aggregate principal amount to $200,000,000, which may be issued under the Indenture. The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to A-1-4 112 the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"), as in effect on the date of the Indenture. Notwithstanding anything to the contrary herein, the Securities are subject to all such terms, and Holders of Securities are referred to the Indenture and the TIA for a statement of them. The Securities are general unsecured obligations of the Company. Payment on each Security is guaranteed on a senior subordinated basis, jointly and severally, by the Guarantors pursuant to Article Ten A of the Indenture. 5. Subordination. The Securities are subordinated in right of payment, in the manner and to the extent set forth in the Indenture, to the prior payment in full in cash or Cash Equivalents of all Senior Indebtedness, whether outstanding on the date of the Indenture or thereafter created, incurred, assumed or guaranteed. To the extent and in the manner provided in the Indenture, Senior Indebtedness must be paid before any payment may be made to any Holder of this Security. Each Holder by his acceptance hereof agrees to be bound by such provisions and authorizes and expressly directs the Trustee, on his behalf, to take such action as may be necessary or appropriate to effectuate the subordination provided for in the Indenture and appoints the Trustee his attorney-in-fact for such purposes. 6. Optional Redemption. (a) The Securities will be redeemable, at the Company's option, in whole at any time or in part from time to time, on and after June 15, 2002, at the following redemption prices (expressed as percentages of the principal amount) if redeemed during the twelve-month period commencing on June 15 of the year set forth below, plus, in each case, accrued and unpaid interest thereon to the date of redemption:
YEAR PERCENTAGE - ---- ---------- 2002 . . . . . . . . . . . . . . . . . . . . . . . 104.375% 2003 . . . . . . . . . . . . . . . . . . . . . . . 102.917% 2004 . . . . . . . . . . . . . . . . . . . . . . . 101.458% 2005 and thereafter . . . . . . . . . . . . . . . . 100.000%
(b) In addition, on or prior to June 15, 2000, the Company may, at its option, use the net cash proceeds of one or more Public Equity Offerings to redeem the Securities, in part, at a redemption price of 108.750% of the principal amount thereof, plus accrued and unpaid interest thereon to the date of redemption; provided, however, that after any such redemption the aggregate principal amount of the Securities outstanding must equal at least 75% of the aggregate principal amount of the Securities originally issued. (c) In addition, at any time prior to June 15, 2000, upon the occurrence of a Change of Control, the Company may redeem the Securities, in whole but not in part, at a redemp- A-1-5 113 tion price equal to the principal amount thereof plus the Applicable Premium plus accrued and unpaid interest, if any, to the date of redemption. The Company may not redeem Securities pursuant to this paragraph if it has made an offer to repurchase the Securities with respect to such Change of Control. "Applicable Premium" means, with respect to a Security, the greater of (i) 1.0% of the then outstanding principal amount of such Security and (ii) (a) the present value of all remaining required interest and principal payments due on such Security and all premium payments relating thereto assuming a redemption date of June 15, 2002, computed using a discount rate equal to the Treasury Rate plus 100 basis points minus (b) the then outstanding principal amount of such Security minus (c) accrued interest paid on the redemption date. "Treasury Rate" means the yield to maturity at the time of computation of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15(519) ("Statistical Release") which has become publicly available at least two business days prior to the date fixed for redemption (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the then remaining term to June 15, 2002; provided, however, that if the then remaining term to June 15, 2002 is not equal to the constant maturity of a United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the then remaining term to June 15, 2002 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used. 7. Notice of Redemption. Notice of redemption will be mailed at least 30 days but not more than 60 days before the Redemption Date to each Holder of Securities to be redeemed at such Holder's registered address. In order to effect a redemption with the proceeds of a Public Equity Offering, the Company shall send the redemption notice in the manner specified in the Indenture not later than 60 days after the consummation of such Public Equity Offering. Securities in denominations larger than $1,000 may be redeemed in part. 8. Change of Control Offer. In the event of a Change of Control, upon the satisfaction of the conditions set forth in the Indenture, the Company shall be required to offer to repurchase all of the then outstanding Securities pursuant to a Change of Control Offer at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of repurchase. Holders of Securities which are the subject of such an offer to repurchase shall A-1-6 114 receive an offer to repurchase and may elect to have such Securities repurchased in accordance with the provisions of the Indenture pursuant to and in accordance with the terms of the Indenture. 9. Limitation on Disposition of Assets. Under certain circumstances, the Company is required to apply the net proceeds from Asset Sales to offer to repurchase Securities at a price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest to the date of repurchase. 10. Denominations; Transfer; Exchange. The Securities are in registered form, without coupons, in denominations of $1,000 and integral multiples of $1,000. A Holder shall register the transfer of or exchange Securities in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay certain transfer taxes or similar governmental charges payable in connection therewith as permitted by the Indenture. The Registrar need not register the transfer of or exchange any Securities during a period beginning 15 days before the mailing of a redemption notice for any Securities or portions thereof selected for redemption. 11. Persons Deemed Owners. The registered Holder of a Security shall be treated as the owner of it for all purposes. 12. Unclaimed Money. If money for the payment of principal or interest remains unclaimed for one year, the Trustee and the Paying Agent will pay the money back to the Company. After that, all liability of the Trustee and such Paying Agent with respect to such money shall cease. 13. Discharge Prior to Redemption or Maturity. If the Company at any time deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations sufficient to pay the principal of and interest on the Securities to redemption or maturity and complies with the other provisions of the Indenture relating thereto, the Company will be discharged from certain provisions of the Indenture and the Securities (including certain covenants, but excluding its obligation to pay the principal of and interest on the Securities). 14. Amendment; Supplement; Waiver. Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the written consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding, and any existing Default or Event of Default or noncompliance with any provision may be waived with the written consent of the Holders of a majority in aggregate principal amount of the Securities then outstanding. Without notice to or consent of any Holder, the parties thereto may A-1-7 115 amend or supplement the Indenture or the Securities to, among other things, cure any ambiguity, defect or inconsistency, provide for uncertificated Securities in addition to or in place of certificated Securities, or comply with Article Five of the Indenture, or make any other change that does not adversely affect in any material respect the rights of any Holder of a Security. 15. Restrictive Covenants. The Indenture imposes certain limitations on the ability of the Company and its Subsidiaries to, among other things, incur additional Indebtedness, make payments in respect of its Capital Stock or certain Indebtedness, engage in certain Asset Swaps, enter into transactions with Affiliates, create dividend or other payment restrictions affecting Subsidiaries and merge or consolidate with any other Person, sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its assets or adopt a plan of liquidation. Such limitations are subject to a number of important qualifications and exceptions. The Company must annually report to the Trustee on compliance with such limitations. 16. Successors. When a successor assumes, in accordance with the Indenture, all the obligations of its predecessor under the Securities and the Indenture, the predecessor will be released from those obligations. 17. Defaults and Remedies. If an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of Securities then outstanding may declare all the Securities to be due and payable in the manner, at the time and with the effect provided in the Indenture. Holders of Securities may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee is not obligated to enforce the Indenture or the Securities unless it has been offered indemnity or security reasonably satisfactory to it. The Indenture permits, subject to certain limitations therein provided, Holders of a majority in aggregate principal amount of the Securities then outstanding to direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders of Securities notice of any continuing Default or Event of Default (except a Default in payment of principal or interest) if it determines in good faith that withholding notice is in their interest. 18. Trustee Dealings with Company. The Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with the Company, its Subsidiaries, Unrestricted Subsidiaries or their respective Affiliates as if it were not the Trustee. 19. No Recourse Against Others. No past, present or future stockholder, director, officer, employee or incorporator, A-1-8 116 as such, of the Company shall have any liability for any obligation of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of, such obligations or their creation. Each Holder of a Security by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issuance of the Securities. 20. Authentication. This Security shall not be valid until the Trustee or authenticating agent manually signs the certificate of authentication on this Security. 21. Governing Law. The laws of the State of New York shall govern this Security and the Indenture, without regard to principles of conflict of laws. 22. Abbreviations and Defined Terms. Customary abbreviations may be used in the name of a Holder of a Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act). 23. CUSIP Numbers. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Securities as a convenience to the Holders of the Securities. No representation is made as to the accuracy of such numbers as printed on the Securities and reliance may be placed only on the other identification numbers printed hereon. 24. Registration Rights. Pursuant to the Registration Rights Agreement, the Company will be obligated to consummate an exchange offer pursuant to which, subject to the terms and conditions of the Registration Rights Agreement, the Holder of this Security shall have the right to exchange this Security for Securities of a separate series issued under the Indenture (or a trust indenture substantially identical to the Indenture in accordance with the terms of the Registration Rights Agreement) which have been registered under the Securities Act, in like principal amount and having identical terms as this Security. The Holders of the Securities shall be entitled to receive certain additional interest payments in the event such exchange offer is not consummated and upon certain other conditions, all pursuant to and in accordance with the terms of the Registration Rights Agreement. 25. Indenture. Each Holder, by accepting a Security, agrees to be bound by all of the terms and provisions of the Indenture, as the same may be amended from time to time. Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture. The Company will furnish to any Holder of a Security A-1-9 117 upon written request and without charge a copy of the Indenture, which has the text of this Security in larger type. Requests may be made to: CHANCELLOR RADIO BROADCASTING COMPANY, 12655 N. Central Expressway, Suite 405, Dallas, Texas 75243. A-1-10 118 GUARANTEE The Guarantors (as defined in the Indenture referred to in the Security upon which this notation is endorsed and each hereinafter referred to as a "Guarantor," which term includes any successor person under the Indenture) have unconditionally guaranteed on a senior basis (such guarantee by each Guarantor being referred to herein as the "Guarantee") (i) the due and punctual payment of the principal of and interest on the Securities, whether at maturity, by acceleration or otherwise, the due and punctual payment of interest on the overdue principal and interest, if any, on the Securities, to the extent lawful, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance with the terms set forth in Article Ten A of the Indenture and (ii) in case of any extension of time of payment or renewal of any Securities or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. No stockholder, officer, director or incorporator, as such, past, present or future, of any Guarantor shall have any liability under the Guarantee by reason of his or its status as such stockholder, officer, director or incorporator. The Guarantees shall not be valid or obligatory for any purpose until the certificate of authentication on the Securities upon which the Guarantees are noted shall have been executed by the Trustee under the Indenture by the manual signature of one of its authorized officers. A-1-11 119 GUARANTORS: TREFOIL COMMUNICATIONS, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: SHAMROCK BROADCASTING, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: SHAMROCK RADIO LICENSES, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: SHAMROCK BROADCASTING OF TEXAS, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: SHAMROCK BROADCASTING LICENSES OF DENVER, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: CHANCELLOR BROADCASTING LICENSEE COMPANY Attest: By: ------------------------------------------ Name: - ------------------------- Title: A-1-12 120 [FORM OF ASSIGNMENT] I or we assign to PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER - -------------------------------- - -------------------------------------------------------------------------------- (please print or type name and address) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- the within Security and all rights thereunder, hereby irrevocably constituting and appointing - -------------------------------------------------------------------------------- attorney to transfer the Security on the books of the Company with full power of substitution in the premises. In connection with any transfer of this Security occurring prior to the date which is the earlier of (i) the date of the declaration by the SEC of the effectiveness of a registration statement under the Securities Act of 1933, as amended (the "Securities Act"), covering resales of this Security (which effectiveness shall not have been suspended or terminated at the date of the transfer) and (ii) June 24, 1999, the undersigned confirms that it has not utilized any general solicitation or general advertising in connection with the transfer and that: [Check One] [ ] (a) this Security is being transferred in compliance with the exemption from registration under the Securities Act provided by Rule 144A thereunder. or [ ] (b) this Security is being transferred other than in accordance with (a) above and documents are being furnished which comply with the conditions of transfer set forth in this Security and the Indenture. If none of the foregoing boxes is checked, the Trustee or Registrar shall not be obligated to register this Security in the name of any person other than the Holder hereof unless and until the conditions to any such transfer of registration set forth herein and in Section 2.16 of the Indenture shall have been satisfied. A-1-13 121 Dated: ------------- ------------------------------------- NOTICE: The signature on this assignment must correspond with the name as it appears upon the face of the within Security in every particular without alteration or enlargement or any change whatsoever and be guaranteed by the endorser's bank or broker. Signature Guarantee: -------------------------------- TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED The undersigned represents and warrants that it is purchasing this Security for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned's foregoing representations in order to claim the exemption from registration provided by Rule 144A. A-1-14 122 OPTION OF HOLDER TO ELECT PURCHASE If you wish to have this Security purchased by the Company pursuant to Section 4.15 or 4.16 of the Indenture, check the Box: [ ] If you wish to have a portion of this Security purchased by the Company pursuant to Section 4.15 or 4.16 of the Indenture, state the amount: $ --------------- Date: Your Signature: --------------- ------------------------------------ (Sign exactly as your name appears on the other side of this Security) Signature Guarantee: ------------------------------- A-1-15 123 EXHIBIT A-2 CHANCELLOR RADIO BROADCASTING COMPANY 8 3/4% Senior Subordinated Notes due 2007 [FORM OF SERIES B SECURITY] No. $ CHANCELLOR RADIO BROADCASTING COMPANY, a Delaware corporation (the "Company"), for value received, promises to pay to or registered assigns, the principal sum of Dollars, on June 15, 2007. Interest Payment Dates: June 15 and December 15 Record Dates: June 1 and December 1 Reference is made to the further provisions of this Security contained herein, which will for all purposes have the same effect as if set forth at this place. IN WITNESS WHEREOF, the Company has caused this Security to be signed manually or by facsimile by its duly authorized officers. CHANCELLOR RADIO BROADCASTING COMPANY By: ------------------------------ Name: Title: By: ------------------------------ Name: Title: A-2-1 124 Trustee's Certificate of Authentication This is one of the 8 3/4% Senior Subordinated Notes due 2007 referred to in the within-mentioned Indenture. Dated: U.S. TRUST COMPANY OF TEXAS, N.A., as Trustee By: --------------------------------------- Authorized Signatory A-2-2 125 (REVERSE OF SECURITY) 8 3/4% Senior Subordinated Notes due 2007 26. Interest. CHANCELLOR RADIO BROADCASTING COMPANY, a Delaware corporation (the "Company"), promises to pay interest on the principal amount of this Security at the rate per annum shown above. Interest on the Securities will accrue from the most recent date on which interest has been paid or, if no interest has been paid, from June 24, 1997. The Company will pay interest semi-annually in arrears on each Interest Payment Date, commencing December 15, 1997. Interest will be computed on the basis of a 360-day year of twelve 30- day months. The Company shall pay interest on overdue principal and on overdue installments of interest from time to time on demand at the rate borne by the Securities to the extent lawful. 27. Method of Payment. The Company shall pay interest on the Securities (except defaulted interest) to the Persons who are the registered Holders at the close of business on the Record Date immediately preceding the Interest Payment Date even if the Securities are cancelled on registration of transfer or registration of exchange after such Record Date. Holders must surrender Securities to a Paying Agent to collect principal payments. The Company shall pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts ("U.S. Legal Tender"). However, the Company may pay principal and interest by its check payable in such U.S. Legal Tender. The Company may deliver any such interest payment to the Paying Agent or to a Holder at the Holder's registered address. 28. Paying Agent and Registrar. Initially, U.S. Trust Company of Texas, N.A. (the "Trustee") will act as Paying Agent and Registrar. The Company may change any Paying Agent, Registrar or co-Registrar without notice to the Holders. The Company or any of its Subsidiaries may, subject to certain exceptions, act as Registrar or co-Registrar. 29. Indenture and Guarantees. The Company issued the Securities under an Indenture, dated as of June 24, 1997 (the "Indenture"), among the Company, the Guarantors and the Trustee. This Security is one of a duly authorized issue of Securities of the Company designated as its 8 3/4% Senior Subordinated Notes due 2007 (the "Securities"), limited (except as otherwise provided in the Indenture) in aggregate principal amount to $200,000,000, which may be issued under the Indenture. The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to A-2-3 126 the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"), as in effect on the date of the Indenture. Notwithstanding anything to the contrary herein, the Securities are subject to all such terms, and Holders of Securities are referred to the Indenture and the TIA for a statement of them. The Securities are general unsecured obligations of the Company. Payment on each Security is guaranteed on a senior subordinated basis, jointly and severally, by the Guarantors pursuant to Article Ten A of the Indenture. 30. Subordination. The Securities are subordinated in right of payment, in the manner and to the extent set forth in the Indenture, to the prior payment in full in cash or Cash Equivalents of all Senior Indebtedness, whether outstanding on the date of the Indenture or thereafter created, incurred, assumed or guaranteed. To the extent and in the manner provided in the Indenture, Senior Indebtedness must be paid before any payment may be made to any Holder of this Security. Each Holder by his acceptance hereof agrees to be bound by such provisions and authorizes and expressly directs the Trustee, on his behalf, to take such action as may be necessary or appropriate to effectuate the subordination provided for in the Indenture and appoints the Trustee his attorney-in-fact for such purposes. 31. Optional Redemption. (a) The Securities will be redeemable, at the Company's option, in whole at any time or in part from time to time, on and after June 15, 2002, at the following redemption prices (expressed as percentages of the principal amount) if redeemed during the twelve-month period commencing on June 15 of the year set forth below, plus, in each case, accrued and unpaid interest thereon to the date of redemption:
YEAR PERCENTAGE - ---- ---------- 2002 . . . . . . . . . . . . . . . . . . 104.375% 2003 . . . . . . . . . . . . . . . . . . 102.917% 2004 . . . . . . . . . . . . . . . . . . 101.458% 2005 and thereafter . . . . . . . . . . . 100.000%
(b) In addition, on or prior to June 15, 2000, the Company may, at its option, use the net cash proceeds of one or more Public Equity Offerings to redeem the Securities, in part, at a redemption price of 108.750% of the principal amount thereof, plus accrued and unpaid interest thereon to the date of redemption; provided, however, that after any such redemption the aggregate principal amount of the Securities outstanding must equal at least 75% of the aggregate principal amount of the Securities originally issued. (c) In addition, at any time prior to June 15, 2000, upon the occurrence of a Change of Control, the Company may redeem the Securities, in whole but not in part, at a redemption A-2-4 127 price equal to the principal amount thereof plus the Applicable Premium plus accrued and unpaid interest, if any, to the date of redemption. The Company may not redeem Securities pursuant to this paragraph if it has made an offer to repurchase the Securities with respect to such Change of Control. "Applicable Premium" means, with respect to a Security, the greater of (i) 1.0% of the then outstanding principal amount of such Security and (ii)(a) the present value of all remaining required interest and principal payments due on such Security and all premium payments relating thereto assuming a redemption date of June 15, 2002, computed using a discount rate equal to the Treasury Rate plus 100 basis points minus (b) the then outstanding principal amount of such Security minus (c) accrued interest paid on the redemption date. "Treasury Rate" means the yield to maturity at the time of computation of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15(519) ("Statistical Release") which has become publicly available at least two business days prior to the date fixed for redemption (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the then remaining term to June 15, 2002; provided, however, that if the then remaining term to June 15, 2002 is not equal to the constant maturity of a United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the then remaining term to June 15, 2002 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used. 32. Notice of Redemption. Notice of redemption will be mailed at least 30 days but not more than 60 days before the Redemption Date to each Holder of Securities to be redeemed at such Holder's registered address. In order to effect a redemption with the proceeds of a Public Equity Offering, the Company shall send the redemption notice in the manner specified in the Indenture not later than 60 days after the consummation of such Public Equity Offering. Securities in denominations larger than $1,000 may be redeemed in part. 33. Change of Control Offer. In the event of a Change of Control, upon the satisfaction of the conditions set forth in the Indenture, the Company shall be required to offer to repurchase all of the then outstanding Securities pursuant to a Change of Control Offer at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of repurchase. Holders of Securities which are the subject of such an offer to repurchase shall A-2-5 128 receive an offer to repurchase and may elect to have such Securities repurchased in accordance with the provisions of the Indenture pursuant to and in accordance with the terms of the Indenture. 34. Limitation on Disposition of Assets. Under certain circumstances, the Company is required to apply the net proceeds from Asset Sales to offer to repurchase Securities at a price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest to the date of repurchase. 35. Denominations; Transfer; Exchange. The Securities are in registered form, without coupons, in denominations of $1,000 and integral multiples of $1,000. A Holder shall register the transfer of or exchange Securities in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay certain transfer taxes or similar governmental charges payable in connection therewith as permitted by the Indenture. The Registrar need not register the transfer of or exchange any Securities during a period beginning 15 days before the mailing of a redemption notice for any Securities or portions thereof selected for redemption. 36. Persons Deemed Owners. The registered Holder of a Security shall be treated as the owner of it for all purposes. 37. Unclaimed Money. If money for the payment of principal or interest remains unclaimed for one year, the Trustee and the Paying Agent will pay the money back to the Company. After that, all liability of the Trustee and such Paying Agent with respect to such money shall cease. 38. Discharge Prior to Redemption or Maturity. If the Company at any time deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations sufficient to pay the principal of and interest on the Securities to redemption or maturity and complies with the other provisions of the Indenture relating thereto, the Company will be discharged from certain provisions of the Indenture and the Securities (including certain covenants, but excluding its obligation to pay the principal of and interest on the Securities). 39. Amendment; Supplement; Waiver. Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the written consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding, and any existing Default or Event of Default or noncompliance with any provision may be waived with the written consent of the Holders of a majority in aggregate principal amount of the Securities then outstanding. Without notice to or consent of any Holder, the parties thereto may A-2-6 129 amend or supplement the Indenture or the Securities to, among other things, cure any ambiguity, defect or inconsistency, provide for uncertificated Securities in addition to or in place of certificated Securities, or comply with Article Five of the Indenture, or make any other change that does not adversely affect in any material respect the rights of any Holder of a Security. 40. Restrictive Covenants. The Indenture imposes certain limitations on the ability of the Company and its Subsidiaries to, among other things, incur additional Indebtedness, make payments in respect of its Capital Stock or certain Indebtedness, engage in certain Asset Swaps, enter into transactions with Affiliates, create dividend or other payment restrictions affecting Subsidiaries and merge or consolidate with any other Person, sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its assets or adopt a plan of liquidation. Such limitations are subject to a number of important qualifications and exceptions. The Company must annually report to the Trustee on compliance with such limitations. 41. Successors. When a successor assumes, in accordance with the Indenture, all the obligations of its predecessor under the Securities and the Indenture, the predecessor will be released from those obligations. 42. Defaults and Remedies. If an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of Securities then outstanding may declare all the Securities to be due and payable in the manner, at the time and with the effect provided in the Indenture. Holders of Securities may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee is not obligated to enforce the Indenture or the Securities unless it has been offered indemnity or security reasonably satisfactory to it. The Indenture permits, subject to certain limitations therein provided, Holders of a majority in aggregate principal amount of the Securities then outstanding to direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders of Securities notice of any continuing Default or Event of Default (except a Default in payment of principal or interest) if it determines in good faith that withholding notice is in their interest. 43. Trustee Dealings with Company. The Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with the Company, its Subsidiaries, Unrestricted Subsidiaries or their respective Affiliates as if it were not the Trustee. 44. No Recourse Against Others. No past, present or future stockholder, director, officer, employee or incorporator, A-2-7 130 as such, of the Company shall have any liability for any obligation of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of, such obligations or their creation. Each Holder of a Security by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issuance of the Securities. 45. Authentication. This Security shall not be valid until the Trustee or authenticating agent manually signs the certificate of authentication on this Security. 46. Governing Law. The laws of the State of New York shall govern this Security and the Indenture, without regard to principles of conflict of laws. 47. Abbreviations and Defined Terms. Customary abbreviations may be used in the name of a Holder of a Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act). 48. CUSIP Numbers. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Securities as a convenience to the Holders of the Securities. No representation is made as to the accuracy of such numbers as printed on the Securities and reliance may be placed only on the other identification numbers printed hereon. 49. Indenture. Each Holder, by accepting a Security, agrees to be bound by all of the terms and provisions of the Indenture, as the same may be amended from time to time. Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture. The Company will furnish to any Holder of a Security upon written request and without charge a copy of the Indenture, which has the text of this Security in larger type. Requests may be made to: CHANCELLOR RADIO BROADCASTING COMPANY, 12655 N. Central Expressway, Suite 405, Dallas, Texas 75243. A-2-8 131 GUARANTEE The Guarantors (as defined in the Indenture referred to in the Security upon which this notation is endorsed and each hereinafter referred to as a "Guarantor," which term includes any successor person under the Indenture) have unconditionally guaranteed on a senior basis (such guarantee by each Guarantor being referred to herein as the "Guarantee") (i) the due and punctual payment of the principal of and interest on the Securities, whether at maturity, by acceleration or otherwise, the due and punctual payment of interest on the overdue principal and interest, if any, on the Securities, to the extent lawful, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance with the terms set forth in Article Ten A of the Indenture and (ii) in case of any extension of time of payment or renewal of any Securities or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. No stockholder, officer, director or incorporator, as such, past, present or future, of any Guarantor shall have any liability under the Guarantee by reason of his or its status as such stockholder, officer, director or incorporator. The Guarantees shall not be valid or obligatory for any purpose until the certificate of authentication on the Securities upon which the Guarantees are noted shall have been executed by the Trustee under the Indenture by the manual signature of one of its authorized officers. A-2-9 132 GUARANTORS: TREFOIL COMMUNICATIONS, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: SHAMROCK BROADCASTING, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: SHAMROCK RADIO LICENSES, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: SHAMROCK BROADCASTING OF TEXAS, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: SHAMROCK BROADCASTING LICENSES OF DENVER, INC. Attest: By: ------------------------------------------ Name: - ------------------------- Title: CHANCELLOR BROADCASTING LICENSEE COMPANY Attest: By: ------------------------------------------ Name: - ------------------------- Title: A-2-10 133 [FORM OF ASSIGNMENT] I or we assign to PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER - -------------------------------- - -------------------------------------------------------------------------------- (please print or type name and address) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- the within Security and all rights thereunder, hereby irrevocably constituting and appointing - -------------------------------------------------------------------------------- attorney to transfer the Security on the books of the Company with full power of substitution in the premises. Dated: ------------- ------------------------------------- NOTICE: The signature on this assignment must correspond with the name as it appears upon the face of the within Security in every particular without alteration or enlargement or any change whatsoever and be guaranteed by the endorser's bank or broker. Signature Guarantee: -------------------------------- A-2-11 134 OPTION OF HOLDER TO ELECT PURCHASE If you wish to have this Security purchased by the Company pursuant to Section 4.15 or 4.16 of the Indenture, check the Box: [ ] If you wish to have a portion of this Security purchased by the Company pursuant to Section 4.15 or 4.16 of the Indenture, state the amount: $ --------------- Date: Your Signature: --------------- ------------------------------------ (Sign exactly as your name appears on the other side of this Security) Signature Guarantee: ------------------------------- A-2-12 135 EXHIBIT B FORM OF LEGEND FOR BOOK-ENTRY SECURITIES Any Global Security authenticated and delivered hereunder shall bear a legend (which would be in addition to any other legends required in the case of a Restricted Security) in substantially the following form: THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. B-1 136 EXHIBIT C Form of Certificate To Be Delivered in Connection with Transfers to Non-QIB Accredited Investors ---------,---- U.S. Trust Company of Texas, N.A. Attention: Corporate Trust Administration Department Re: Chancellor Radio Broadcasting Company (the "Company") 8 3/4% Senior Subordinated Notes due 2007 (the "Securities") Ladies and Gentlemen: In connection with our proposed purchase of $_______ aggregate principal amount of the Securities, we confirm that: 1. We understand that any subsequent transfer of the Securities is subject to certain restrictions and conditions set forth in the Indenture dated as of June 24, 1997 relating to the Securities and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Securities except in compliance with, such restrictions and conditions and the Securities Act of 1933, as amended (the "Securities Act"). 2. We understand that the offer and sale of the Securities have not been registered under the Securities Act, and that the Securities may not be offered or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell or otherwise transfer any Securities prior to the date which is two years after the original issuance of the Securities, we will do so only (i) to the Company or any of its subsidiaries, (ii) inside the United States in accordance with Rule 144A under the Securities Act to a "qualified institutional buyer" (as defined in Rule 144A under the Securities Act), (iii) inside the United States to an institutional "accredited investor" (as defined below) that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to the Trustee (as defined in the Indenture relating to the Securities), a signed letter C-1 137 containing certain representations and agreements relating to the restrictions on transfer of the Securities, (iv) outside the United States in accordance with Rule 904 of Regulation S under the Securities Act, (v) pursuant to the exemption from registration provided by Rule 144 under the Securities Act (if available), or (vi) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any person purchasing any of the Securities from us a notice advising such purchaser that resales of the Securities are restricted as stated herein. 3. We are not acquiring the Securities for or on behalf of, and will not transfer the Securities to, any pension or welfare plan (as defined in Section 3 of the Employee Retirement Income Security Act of 1974), except as permitted in the section entitled "Transfer Restrictions" of the Offering Circular. 4. We understand that, on any proposed resale of any Securities, we will be required to furnish to the Trustee and the Company such certification, legal opinions and other information as the Trustee and the Company may reasonably require to confirm that the proposed sale complies with the foregoing restrictions. We further understand that the Securities purchased by us will bear a legend to the foregoing effect. 5. We are an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Securities, and we and any accounts for which we are acting are each able to bear the economic risk of our or their investment, as the case may be. 6. We are acquiring the Securities purchased by us for our account or for one or more accounts (each of which is an institutional "accredited investor") as to each of which we exercise sole investment discretion. You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Very truly yours, By: ------------------------------------------ Name: Title: C-2 138 EXHIBIT D Form of Certificate To Be Delivered in Connection with Transfers Pursuant to Regulation S ---------,---- U.S. Trust Company of Texas, N.A. Attention: Corporate Trust Administration Department Re: Chancellor Radio Broadcasting Company (the "Company") 8 3/4% Senior Subordinated Notes due 2007 (the "Securities") Dear Sirs: In connection with our proposed sale of $ _____________ aggregate principal amount of the Securities, we confirm that such sale has been effected pursuant to and in accordance with Regulation S under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, we represent that: (1) the offer of the Securities was not made to a person in the United States; (2) either (a) at the time the buy offer was originated, the transferee was outside the United States or we and any person acting on our behalf reasonably believed that the transferee was outside the United States, or (b) the transaction was executed in, on or through the facilities of a designated off-shore securities market and neither we nor any person acting on our behalf knows that the transaction has been pre-arranged with a buyer in the United States; (3) no directed selling efforts have been made in the United States in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S, as applicable; (4) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act; and (5) we have advised the transferee of the transfer D-1 139 restrictions applicable to the Securities. You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S. Very truly yours, [Name of Transferor] By: --------------------------------------- Authorized Signature D-2 EX-10.1 3 AMENDED & RESTATED CREDIT AGREEMENT 1 EXHIBIT 10.1 ================================================================================ AMENDED AND RESTATED CREDIT AGREEMENT among CHANCELLOR BROADCASTING COMPANY, CHANCELLOR RADIO BROADCASTING COMPANY, VARIOUS BANKS, GOLDMAN SACHS CREDIT PARTNERS L.P., as DOCUMENTATION AGENT, NATIONSBANK OF TEXAS, N.A., as SYNDICATION AGENT, TORONTO DOMINION (TEXAS), INC., as SYNDICATION AGENT and BANKERS TRUST COMPANY, as MANAGING AGENT and ARRANGER ------------------------- Dated as of February 14, 1996 and Amended and Restated as of January 23, 1997 and further Amended and Restated as of July 2, 1997 ------------------------- $750,000,000 ================================================================================ 2 TABLE OF CONTENTS
PAGE ---- SECTION 1. Amount and Terms of Credit . . . . . . . . . . . . . . . . .. 1 1.01 The Commitments . . . . . . . . . . . . . . . . . . . . . . . . 1 1.02 Minimum Amount of Each Borrowing . . . . . . . . . . . . . . . 3 1.03 Notice of Borrowing . . . . . . . . . . . . . . . . . . . . . . 4 1.04 Disbursement of Funds . . . . . . . . . . . . . . . . . . . . 5 1.05 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 1.06 Conversions . . . . . . . . . . . . . . . . . . . . . . . . . 6 1.07 Pro Rata Borrowings . . . . . . . . . . . . . . . . . . . . . 7 1.08 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 1.09 Interest Periods . . . . . . . . . . . . . . . . . . . . . . . 8 1.10 Increased Costs, Illegality, etc. . . . . . . . . . . . . . . 9 1.11 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . 12 1.12 Change of Lending Office . . . . . . . . . . . . . . . . . . . 12 1.13 Replacement of Banks . . . . . . . . . . . . . . . . . . . . . 12 SECTION 2. Letters of Credit . . . . . . . . . . . . . . . . . . . . . . 14 2.01 Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . 14 2.02 Letter of Credit Requests . . . . . . . . . . . . . . . . . . . 16 2.03 Letter of Credit Participations . . . . . . . . . . . . . . . . 16 2.04 Agreement to Repay Letter of Credit Drawings . . . . . . . . . 19 2.05 Increased Costs . . . . . . . . . . . . . . . . . . . . . . . . 19 SECTION 3. Commitment Commission; Fees; Reductions of Commitment . . . . 20 3.01 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 3.02 Voluntary Termination and Reduction of Commitments . . . . . . 22 3.03 Mandatory Reduction of Commitments . . . . . . . . . . . . . . 22 SECTION 4. Prepayments; Payments; Taxes . . . . . . . . . . . . . . . . . 23 4.01 Voluntary Prepayments . . . . . . . . . . . . . . . . . . . . . 23 4.02 Mandatory Repayments and Commitment Reductions . . . . . . . . 24 4.03 Method and Place of Payment . . . . . . . . . . . . . . . . . . 32 4.04 Net Payments . . . . . . . . . . . . . . . . . . . . . . . . . 32 SECTION 5. Conditions Precedent to Credit Events on the Second Restatement Effective Date . . . . . . . . . . . . . . . . . . . . . 34
3
PAGE ---- 5.01 Execution of Agreement; Notes . . . . . . . . . . . . . . . . . 34 5.02 Fees, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 5.03 Opinions of Counsel . . . . . . . . . . . . . . . . . . . . . . 35 5.04 Corporate Documents; Proceedings; etc.. . . . . . . . . . . . . 35 5.05 Shareholders' Agreements; Management Agreements; Employment Agreements; Tax Sharing Agreements . . . . . . . 35 5.06 Absence of Certain Conditions . . . . . . . . . . . . . . . . . 36 5.07 Consummation of the Bridge Financing; Transaction . . . . . . . 36 5.08 Subsidiary Guaranty . . . . . . . . . . . . . . . . . . . . . . 39 5.09 Pledge Agreement . . . . . . . . . . . . . . . . . . . . . . . 39 5.10 Subsidiary Security Agreement . . . . . . . . . . . . . . . . . 39 5.11 Existing Mortgages; Title Insurance; etc. . . . . . . . . . . . 40 5.12 Environmental Indemnity Agreement . . . . . . . . . . . . . . . 41 5.13 Existing Credit Agreement; etc. . . . . . . . . . . . . . . . . 41 5.14 Adverse Change, etc.. . . . . . . . . . . . . . . . . . . . . . 42 5.15 Solvency Certificate; Environmental Analyses; Insurance . . . . 42 5.16 Pro Forma Balance Sheet; Projections . . . . . . . . . . . . . 42 5.17 Acknowledgment, Consent and Amendment . . . . . . . . . . . . . 43 SECTION 6. Conditions Precedent to All Credit Events . . . . . . . . . . 44 6.01 No Default; Representations and Warranties . . . . . . . . . . 44 6.02 Notice of Borrowing; Letter of Credit Request . . . . . . . . . 44 SECTION 7. Representations, Warranties and Agreements . . . . . . . . . . 45 7.01 Corporate Status . . . . . . . . . . . . . . . . . . . . . . . 45 7.02 Corporate Power and Authority . . . . . . . . . . . . . . . . . 45 7.03 No Violation . . . . . . . . . . . . . . . . . . . . . . . . . 46 7.04 Governmental Approvals . . . . . . . . . . . . . . . . . . . . 46 7.05 Financial Statements; Financial Condition; Undisclosed Liabilities; Projections; etc.. . . . . . . . . . . . . . . . . 47 7.06 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . 48 7.07 True and Complete Disclosure . . . . . . . . . . . . . . . . . 48 7.08 Use of Proceeds; Margin Regulations . . . . . . . . . . . . . . 48 7.09 Tax Returns and Payments . . . . . . . . . . . . . . . . . . . 49 7.10 Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . 50 7.11 The Security Documents . . . . . . . . . . . . . . . . . . . . 50 7.12 Representations and Warranties in Documents . . . . . . . . . . 51 7.13 Properties . . . . . . . . . . . . . . . . . . . . . . . . . . 52 7.14 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . 52 7.15 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . 53
(ii) 4
PAGE ---- 7.16 Compliance with Statutes, etc.. . . . . . . . . . . . . . . . . 53 7.17 Investment Company Act . . . . . . . . . . . . . . . . . . . . 54 7.18 Public Utility Holding Company Act . . . . . . . . . . . . . . 54 7.19 Labor Relations . . . . . . . . . . . . . . . . . . . . . . . . 54 7.20 Patents, Licenses, Franchises and Formulas . . . . . . . . . . 54 7.21 Transaction; Bridge Financing . . . . . . . . . . . . . . . . . 55 7.22 Special Purpose Corporations . . . . . . . . . . . . . . . . . 55 7.23 FCC Licenses . . . . . . . . . . . . . . . . . . . . . . . . . 55 7.24 Subordinated Notes . . . . . . . . . . . . . . . . . . . . . . 56 SECTION 8. Affirmative Covenants . . . . . . . . . . . . . . . . . . . . 56 8.01 Information Covenants . . . . . . . . . . . . . . . . . . . . . 57 8.02 Books, Records and Inspections . . . . . . . . . . . . . . . . 60 8.03 Maintenance of Property; Insurance . . . . . . . . . . . . . . 60 8.04 Corporate Franchises . . . . . . . . . . . . . . . . . . . . . 61 8.05 Compliance with Statutes, etc.. . . . . . . . . . . . . . . . . 62 8.06 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 8.07 End of Fiscal Years; Fiscal Quarters . . . . . . . . . . . . . 63 8.08 Performance of Obligations . . . . . . . . . . . . . . . . . . 63 8.09 Payment of Taxes . . . . . . . . . . . . . . . . . . . . . . . 63 8.10 Maintenance of Separateness . . . . . . . . . . . . . . . . . . 63 8.11 Dividends on Series A Exchangeable Preferred Stock and Exchangeable Preferred Stock; Interest on Bridge Financing . 64 8.12 Additional Security; Further Assurances . . . . . . . . . . . . 64 8.13 Designation of Agent . . . . . . . . . . . . . . . . . . . . . 67 SECTION 9. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . 67 9.01 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 9.02 Consolidation, Merger, Purchase or Sale of Assets, etc. . . . . 71 9.03 Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . 74 9.04 Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . 76 9.05 Advances, Investments and Loans . . . . . . . . . . . . . . . . 79 9.06 Transactions with Affiliates . . . . . . . . . . . . . . . . . 81 9.07 Capital Expenditures . . . . . . . . . . . . . . . . . . . . . 82 9.08 Maximum Leverage Ratio . . . . . . . . . . . . . . . . . . . . 84 9.09 Minimum Consolidated EBITDA . . . . . . . . . . . . . . . . . . 85 9.10 Consolidated EBITDA to Consolidated Net Cash Interest Expense . . . . . . . . . . . . . . . . . . . . . . . . . . 86
(iii) 5
PAGE ---- 9.11 Limitation on Modifications of Certificate of Incorporation, By- Laws and Certain Other Agreements; Limitations of Prepayments and Modifications of Indebtedness; etc.. . . . 87 9.12 Limitation on Certain Restrictions on Subsidiaries . . . . . 88 9.13 Limitation on Issuance of Capital Stock . . . . . . . . . . . 88 9.14 Business . . . . . . . . . . . . . . . . . . . . . . . . . . 88 9.15 Limitation on Creation of Subsidiaries . . . . . . . . . . . 89 9.16 No Other Designated Senior Debt . . . . . . . . . . . . . . . 89 SECTION 10. Events of Default . . . . . . . . . . . . . . . . . . . . . 89 10.01 Payments . . . . . . . . . . . . . . . . . . . . . . . . . . 89 10.02 Representations, etc.. . . . . . . . . . . . . . . . . . . . 89 10.03 Covenants . . . . . . . . . . . . . . . . . . . . . . . . . 90 10.04 Default Under Other Agreements . . . . . . . . . . . . . . . 90 10.05 Bankruptcy, etc. . . . . . . . . . . . . . . . . . . . . . . 90 10.06 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 10.07 Security Documents . . . . . . . . . . . . . . . . . . . . . 91 10.08 Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . 91 10.09 Judgments . . . . . . . . . . . . . . . . . . . . . . . . . 92 10.10 Change of Ownership . . . . . . . . . . . . . . . . . . . . 92 10.11 Environmental Matters . . . . . . . . . . . . . . . . . . . 92 SECTION 11. Definitions and Accounting Terms. . . . . . . . . . . . . . 93 11.01 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . 93 SECTION 12. The Managing Agent . . . . . . . . . . . . . . . . . . . . 128 12.01 Appointment . . . . . . . . . . . . . . . . . . . . . . . . 128 12.02 Nature of Duties . . . . . . . . . . . . . . . . . . . . . . 129 12.03 Lack of Reliance on the Managing Agent . . . . . . . . . . . 129 12.04 Certain Rights of the Managing Agent . . . . . . . . . . . . 129 12.05 Reliance . . . . . . . . . . . . . . . . . . . . . . . . . . 130 12.06 Indemnification . . . . . . . . . . . . . . . . . . . . . . 130 12.07 The Managing Agent in Its Individual Capacity . . . . . . . 130 12.08 Holders . . . . . . . . . . . . . . . . . . . . . . . . . . 130 12.09 Resignation by the Managing Agent . . . . . . . . . . . . . 131 SECTION 13. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . 131 13.01 Payment of Expenses, etc.. . . . . . . . . . . . . . . . . . 131 13.02 Right of Setoff; Collateral Matters . . . . . . . . . . . . 133 13.03 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . 134
(iv) 6
PAGE ---- 13.04 Benefit of Agreement . . . . . . . . . . . . . . . . . . . . 134 13.05 No Waiver; Remedies Cumulative . . . . . . . . . . . . . . . 136 13.06 Payments Pro Rata . . . . . . . . . . . . . . . . . . . . . 136 13.07 Calculations; Computations . . . . . . . . . . . . . . . . . 137 13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . 137 13.09 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . 139 13.10 Effectiveness . . . . . . . . . . . . . . . . . . . . . . . 139 13.11 Headings Descriptive . . . . . . . . . . . . . . . . . . . . 140 13.12 Amendment or Waiver; etc.. . . . . . . . . . . . . . . . . . 140 13.13 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . 141 13.14 Domicile of Loans . . . . . . . . . . . . . . . . . . . . . 142 13.15 Limitation on Additional Amounts, etc. . . . . . . . . . . . 142 13.16 Confidentiality . . . . . . . . . . . . . . . . . . . . . . 142 13.17 Register . . . . . . . . . . . . . . . . . . . . . . . . . . 143 13.18 Additions of New Banks; Conversion of Existing Loans of Continuing Banks; Termination of Commitments of Non- Continuing Banks . . . . . . . . . . . . . . . . . . . . . 144 SECTION 14. Holdings Guaranty . . . . . . . . . . . . . . . . . . . . . 145 14.01 The Guaranty . . . . . . . . . . . . . . . . . . . . . . . . 145 14.02 Bankruptcy . . . . . . . . . . . . . . . . . . . . . . . . . 145 14.03 Nature of Liability . . . . . . . . . . . . . . . . . . . . 145 14.04 Independent Obligation . . . . . . . . . . . . . . . . . . . 146 14.05 Authorization . . . . . . . . . . . . . . . . . . . . . . . 146 14.06 Reliance . . . . . . . . . . . . . . . . . . . . . . . . . . 147 14.07 Subordination . . . . . . . . . . . . . . . . . . . . . . . 147 14.08 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 14.09 Nature of Liability . . . . . . . . . . . . . . . . . . . . 149
SCHEDULE I Commitments SCHEDULE II Existing Letters of Credit SCHEDULE III Real Property SCHEDULE IV FCC Licenses SCHEDULE V Insurance SCHEDULE VI Existing Liens SCHEDULE VII Existing Indebtedness SCHEDULE VIII Existing Investments (v) 7 ANNEX A Evergreen Loan Agreement ANNEX 5.07 FCC License Issues EXHIBIT A Notice of Borrowing EXHIBIT B-1 Term Note EXHIBIT B-2 Revolving Note EXHIBIT C Letter of Credit Request EXHIBIT D Section 4.04(b)(ii) Certificate EXHIBIT E-1 Opinion of Weil Gotshal & Manges L.L.P., Special Counsel to the Credit Parties EXHIBIT E-2 Opinion of Liebowitz & Associates, Special FCC Counsel to the Credit Parties EXHIBIT F Officers' Certificate EXHIBIT G Subsidiary Guaranty EXHIBIT H Subsidiary Pledge Agreement EXHIBIT I Subsidiary Security Agreement EXHIBIT J Form of Mortgage EXHIBIT K Environmental Indemnity Agreement EXHIBIT L Assignment and Assumption Agreement EXHIBIT M Acknowledgement, Consent and Amendment (vi) 8 AMENDED AND RESTATED CREDIT AGREEMENT, dated as of February 14, 1996 and amended and restated as of January 23, 1997 and further amended and restated as of July 2, 1997, among CHANCELLOR BROADCASTING COMPANY (formerly known as CHANCELLOR CORPORATION), a Delaware corporation ("Holdings"), CHANCELLOR RADIO BROADCASTING COMPANY (formerly known as CHANCELLOR BROADCASTING COMPANY), a Delaware corporation (the "Borrower"), the Banks party hereto from time to time, GOLDMAN SACHS CREDIT PARTNERS L.P., as Documentation Agent, TORONTO DOMINION (TEXAS), INC. and NATIONSBANK OF TEXAS, N.A., as Syndication Agent, and BANKERS TRUST COMPANY, as Managing Agent (all capitalized terms used herein and defined in Section 11 are used herein as therein defined). WITNESSETH: WHEREAS, Holdings, the Borrower, the Existing Banks and Bankers Trust Company, as Managing Agent, are party to a Credit Agreement, dated as of February 14, 1996 and amended and restated as of January 23, 1997 (as the same has been amended, modified or supplemented to, but not including, the Second Restatement Effective Date, the "Existing Credit Agreement"); and WHEREAS, the parties hereto wish to amend and restate the Existing Credit Agreement as herein provided; NOW, THEREFORE, the parties hereto agree that the Existing Credit Agreement shall be and hereby is amended and restated in its entirety as follows: NOW, THEREFORE, IT IS AGREED: SECTION 1. Amount and Terms of Credit. 1.01 The Commitments. (a) Subject to and upon the terms and conditions set forth herein, each Bank with a Term Loan Commitment severally agrees, (A) in the case of each Continuing Bank, to convert into Term Loans (each, a "Term Loan Conversion", and collectively, the "Term Loan Conversions") on the Second Restatement Effective Date, the Existing Term Loans made by such Continuing Bank to the Borrower pursuant to the Existing Credit Agreement and outstanding on the Second Restatement Effective Date in an aggregate principal amount equal to the 9 aggregate principal amount of such Existing Term Loans made by such Continuing Bank and so outstanding and/or (B) to make, on the Second Restatement Effective Date a term loan or term loans (together with each Term Loan Conversion each, a "Term Loan" and, collectively, the "Term Loans") to the Borrower, which Term Loans (i) made or converted on the Second Restatement Effective Date, shall not exceed for any Bank, in an initial principal amount, that amount which equals such Bank's Term Loan Commitment and (ii) shall, at the option of the Borrower, be Base Rate Loans or Eurodollar Loans, provided that, except as otherwise specifically provided in Section 1.10(b), all Term Loans comprising the same Borrowing shall at all times be of the same Type. Once repaid, Term Loans borrowed hereunder may not be reborrowed. (b) Subject to and upon the terms and conditions set forth herein, each Bank with a Revolving Loan Commitment severally agrees, (A) in the case of each Continuing Bank, to convert into Revolving Loans (each a "Revolving Loan Conversion", and collectively the "Revolving Loan Conversions"), on the Second Restatement Effective Date, Existing Revolving Loans made by such Continuing Bank to the Borrower pursuant to the Existing Credit Agreement and outstanding on the Second Restatement Effective Date in an aggregate principal amount equal to the lesser of (x) the aggregate principal amount of such Existing Revolving Loans made by such Continuing Bank and so outstanding and (y) such Continuing Bank's Adjusted RL Percentage of the aggregate principal amount of Revolving Loans made by all Banks and outstanding on the Second Restatement Effective Date and/or (B) at any time and from time to time on and after the Second Restatement Effective Date and prior to the Maturity Date, to make a revolving loan or revolving loans (together with each Revolving Loan Conversion each, a "Revolving Loan" and, collectively, the "Revolving Loans") to the Borrower, which Revolving Loans (i) shall, at the option of the Borrower, be Base Rate Loans or Eurodollar Loans, provided that, except as otherwise specifically provided in Section 1.10(b), all Revolving Loans comprising the same Borrowing shall at all times be of the same Type, (ii) may be repaid and reborrowed in accordance with the provisions hereof, (iii) shall not exceed for any Bank at any time outstanding that aggregate principal amount (which amount, in the case of each Continuing Bank, shall include the principal amount of each Revolving Loan Conversion) which, when added to the product of (x) such Bank's Adjusted RL Percentage and (y) the aggregate amount of all Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid with the proceeds of, and simultaneously with the incurrence of, the respective incurrence of Revolving Loans) at such time, equals the Revolving Loan Commitment of such Bank at such time and (iv) shall not exceed for all Banks at any time outstanding that aggregate principal amount which, when added to the amount of all Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid with the proceeds of, and simultaneously with the incurrence of, the -2- 10 respective incurrence of Revolving Loans) at such time, equals the Total Revolving Loan Commitment at such time. (c) Notwithstanding any other provision of this Agreement, each Bank with a Tenn Loan outstanding or with a Revolving Loan Commitment severally agrees, automatically and immediately effective upon the consummation of the Evergreen Merger (so long as (i) no Default or Event of Default then exists under Section 10.01 or 10.05 of this Agreement and (ii) no Default or Event of Default then exists under Section 8.01(b), (f) or (g) of (and as such terms are defined in) the Evergreen Loan Agreement (defined below)), that such Term Loan shall become a Term Loan for the identical amount (and with a corresponding Term Loan Commitment) under the Second Amended and Restated Loan Agreement among Evergreen Media of LA (which entity shall be the surviving corporation of a merger with the Borrower pursuant to the Evergreen Merger Agreement, and accordingly the successor in interest to the Borrower), the Lenders signatory thereto (the "Lenders"), Toronto Dominion (Texas), Inc., Bankers Trust Company, The Bank of New York, NationsBank of Texas, N.A., and Union Bank of California, as Managing Agents, and Toronto Dominion (Texas), Inc., as Administrative Agent for the Lenders (the "Evergreen Administrative Agent"), dated as of April 25, 1997, as amended by a certain First Amendment to Second Amended and Restated Loan Agreement dated as of June 26, 1997 (as amended, the "Evergreen Loan Agreement") a copy of which is attached hereto as Annex A, and each Bank with a Revolving Loan Commitment agrees that such Revolving Loan Commitment shall become, automatically and immediately effective without further action upon the consummation of the Evergreen Merger, a Revolving Loan Commitment (with the amount of outstanding Revolving Loans converted into an equal amount of new Revolving Loans) for the identical amount under the Evergreen Loan Agreement. The Evergreen Administrative Agent shall, on the date of the Evergreen Merger, issue a revised Schedule 1 - Commitment Ratios, to each Lender under the Evergreen Loan Agreement, which shall include each Bank hereunder, and thereafter, the new Borrower shall issue new promissory notes to each Bank which requests such notes promptly after such requests and relinquishment by such Bank of any Notes issued hereunder. Concurrently with such conversion, (i) the Borrower shall pay all unpaid interest, fees and other amounts (other than principal in respect of the outstanding Loans) which are unpaid at such time, all Loans hereunder shall be deemed repaid and satisfied in full and all Revolving Loan Commitments shall be automatically terminated and (ii) all Letters of Credit which remain outstanding hereunder shall be deemed terminated for purposes of this Agreement to the extent assumed as Letters of Credit under the Evergreen Loan Agreement. 1.02 Minimum Amount of Each Borrowing. The aggregate principal amount of each Borrowing of Term Loans shall not be less than $2,000,000 and, if -3- 11 greater, shall be in an integral multiple of $100,000. The aggregate principal amount of each Borrowing of Revolving Loans shall be not less than $250,000 and, if greater, shall be in an integral multiple of $50,000 or, if less, the then remaining Total Unutilized Revolving Loan Commitment. More than one Borrowing may occur on the same date, but at no time shall there be outstanding more than ten Borrowings of Eurodollar Loans. 1.03 Notice of Borrowing. (a) Whenever the Borrower desires to incur a Borrowing hereunder, it shall give the Managing Agent at its Notice Office at least one Business Day's prior written (or telephonic promptly confirmed in writing) notice of each Base Rate Loan and at least three Business Days' prior written (or telephonic promptly confirmed in writing) notice of each Eurodollar Loan to be made hereunder, provided that any such notice shall be deemed to have been given on a certain day only if given before 11:00 A.M. (New York time) in the case of a Borrowing of Eurodollar Loans, or 12:00 Noon (New York time) in the case of a Borrowing of Base Rate Loans, on such day. Each such written notice or written confirmation of telephonic notice (each a "Notice of Borrowing"), except as otherwise expressly provided in Section 1.10, shall be irrevocable and shall be given by the Borrower in the form of Exhibit A, appropriately completed to specify the aggregate principal amount of the Loans to be made pursuant to such Borrowing, the date of such Borrowing (which shall be a Business Day), whether the Loans being made pursuant to such Borrowing shall constitute Term Loans or Revolving Loans and whether the Loans being made pursuant to such Borrowing are to be initially maintained as Base Rate Loans or Eurodollar Loans and, if Eurodollar Loans, the initial Interest Period to be applicable thereto. The Managing Agent shall promptly give each Bank which is required to make Loans of the Tranche specified in the respective Notice of Borrowing, notice of such proposed Borrowing, of such Bank's proportionate share thereof and of the other matters required by the immediately preceding sentence to be specified in the Notice of Borrowing. (b) Without in any way limiting the obligation of the Borrower to confirm in writing any telephonic notice of any Borrowing of Loans, the Managing Agent may act without liability upon the basis of telephonic notice of such Borrowing, believed by the Managing Agent in good faith to be from the President, Chief Financial Officer or Senior Vice President of Finance of the Borrower (or any other officer of the Borrower designated in writing to the Managing Agent by the President, the Chief Financial Officer or Senior Vice President of Finance of the Borrower as being authorized to give such notices under this Agreement) prior to receipt of written confirmation. In each such case, the Borrower hereby waives the right to dispute the Managing Agent's record of the terms of such telephonic notice of such Borrowing of Loans. -4- 12 1.04 Disbursement of Funds. Except as otherwise specifically provided in the second succeeding sentence, no later than 12:00 Noon (New York time) on the date specified in each Notice of Borrowing, each Bank with a Commitment of the respective Tranche will make available its pro rata portion of each such Borrowing requested to be made on such date. All such amounts shall be made available in Dollars and in immediately available funds at the Payment Office of the Managing Agent, and the Managing Agent will make available to the Borrower at the Payment Office the aggregate of the amounts so made available by the Banks (prior to 1:00 P.M. on such day, to the extent of funds actually received by the Managing Agent prior to 12:00 Noon on such day). Unless the Managing Agent shall have been notified by any Bank prior to the date of Borrowing that such Bank does not intend to make available to the Managing Agent such Bank's portion of any Borrowing to be made on such date, the Managing Agent may assume that such Bank has made such amount available to the Managing Agent on such date of Borrowing and the Managing Agent may, in reliance upon such assumption, make available to the Borrower a corresponding amount. If such corresponding amount is not in fact made available to the Managing Agent by such Bank, the Managing Agent shall be entitled to recover such corresponding amount on demand from such Bank. If such Bank does not pay such corresponding amount forthwith upon the Managing Agent's demand therefor, the Managing Agent shall promptly notify the Borrower and the Borrower shall immediately pay such corresponding amount to the Managing Agent. The Managing Agent shall also be entitled to recover on demand from such Bank or the Borrower, as the case may be, interest on such corresponding amount in respect of each day from the date such corresponding amount was made available by the Managing Agent to the Borrower until the date such corresponding amount is recovered by the Managing Agent, at a rate per annum equal to (i) if recovered from such Bank, at the overnight Federal Funds Rate and (ii) if recovered from the Borrower, the rate of interest applicable to the respective Borrowing, as determined pursuant to Section 1.08. Nothing in this Section 1.04 shall be deemed to relieve any Bank from its obligation to make Loans hereunder or to prejudice any rights which the Borrower may have against any Bank as a result of any failure by such Bank to make Loans hereunder. 1.05 Notes. (a) The Borrower's obligation to pay the principal of, and interest on, the Loans made by each Bank shall, if requested by any Bank, be evidenced (i) if Term Loans, by a promissory note duly executed and delivered by the Borrower substantially in the form of Exhibit B-1 with blanks appropriately completed in conformity herewith (each, a "Term Note" and, collectively, the "Tenn Notes") and (ii) if Revolving Loans, by a promissory note duly executed and delivered by the Borrower substantially in the form of Exhibit B-2, with blanks appropriately completed in conformity herewith (each, a "Revolving Note" and, collectively, the "Revolving Notes"). -5- 13 (b) The Term Note issued to each Bank shall (i) be executed by the Borrower, (ii) be payable to the order of such Bank and be dated the Second Restatement Effective Date, (iii) be in a stated principal amount equal to the Term Loan Commitment of such Bank as in effect on the Second Restatement Effective Date (before giving effect to any reductions thereto as a result of the making of Term Loans by such Bank on such date) and be payable in the principal amount of Term Loans evidenced thereby, (iv) mature on the Maturity Date, (v) bear interest as provided in the appropriate clause of Section 1.08 in respect of the Base Rate Loans and Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to voluntary prepayment as provided in Section 4.01, and mandatory repayment as provided in Section 4.02 and (vii) be entitled to the benefits of this Agreement and the other Credit Documents. (c) The Revolving Note issued to each Bank shall (i) be executed by the Borrower, (ii) be payable to the order of such Bank and be dated the Second Restatement Effective Date, (iii) be in a stated principal amount equal to the Revolving Loan Commitment of such Bank and be payable in the principal amount of the Revolving Loans evidenced thereby, (iv) mature on the Maturity Date, (v) bear interest as provided in the appropriate clause of Section 1.08 in respect of the Base Rate Loans and Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to voluntary prepayment as provided in Section 4.01, and mandatory repayment as provided in Section 4.02 and (vii) be entitled to the benefits of this Agreement and the other Credit Documents. (d) Each Bank will note on its internal records the amount of each Loan made by it and each payment in respect thereof and will prior to any transfer of any of its Notes endorse on the reverse side thereof the outstanding principal amount of Loans evidenced thereby. Failure to make any such notation or any error in any such notation or endorsement shall not affect the Borrower's obligations in respect of such Loans. 1.06 Conversions. The Borrower shall have the option to convert, on any Business Day, all or a portion equal to at least (x) in the case of a conversion of Term Loans, $2,000,000 (and, if greater, in an integral multiple of $100,000) and (y) in the case of a conversion of Revolving Loans, $1,000,000 (and, if greater, in an integral multiple of $250,000), of the outstanding principal amount of Loans made pursuant to one or more Borrowings (so long as of the same Tranche) of one or more Types of Loans into a Borrowing (of the same Tranche) of another Type of Loan, provided that (i) except as otherwise provided in Section 1. 10(b), Eurodollar Loans may be converted into Base Rate Loans only on the last day of an Interest Period applicable to the Loans being converted and no partial conversion of Eurodollar Loans shall reduce the outstanding principal amount of such Eurodollar Loans made pursuant to a single Borrowing to less than (x) in the case of Term Loans, $2,000,000, and (y) in the -6- 14 case of Revolving Loans, $1,000,000, (ii) Base Rate Loans may only be converted into Eurodollar Loans if no Default or Event of Default is in existence on the date of the conversion and (iii) no conversion pursuant to this Section 1.06 shall result in a greater number of Eurodollar Loans than is permitted under Section 1.02. Each such conversion shall be effected by the Borrower by giving the Managing Agent at its Notice Office prior to 12:00 Noon (New York time) at least three Business Days' prior notice (each a "Notice of Conversion") specifying the Loans to be so converted, the Borrowing or Borrowings pursuant to which such Loans were made and, if to be converted into Eurodollar Loans, the Interest Period to be initially applicable thereto. The Managing Agent shall give each Bank prompt notice of any such proposed conversion affecting any of its Loans. 1.07 Pro Rata Borrowings. All Borrowings of Term Loans and Revolving Loans under this Agreement shall be incurred from the Banks pro rata on the basis of their Term Loan Commitments or Revolving Loan Commitments, as the case may be. It is understood that no Bank shall be responsible for any default by any other Bank of its obligation to make Loans hereunder and that each Bank shall be obligated to make the Loans provided to be made by it hereunder, regardless of the failure of any other Bank to make its Loans hereunder. 1.08 Interest. (a) The Borrower agrees to pay interest in respect of the unpaid principal amount of each Base Rate Loan from the date the proceeds thereof are made available to the Borrower until the earlier of (i) the maturity (whether by acceleration, optional or mandatory prepayment or otherwise) of such Base Rate Loan and (ii) the conversion of such Base Rate Loan to a Eurodollar Loan pursuant to Section 1.06, at a rate per annum which shall be equal to the sum of the Applicable Margin plus the Base Rate in effect from time to time. (b) The Borrower agrees to pay interest in respect of the unpaid principal amount of each Eurodollar Loan from the date the proceeds thereof are made available to the Borrower until the earlier of (i) the maturity (whether by acceleration, optional or mandatory prepayment or otherwise) of such Eurodollar Loan and (ii) the conversion of such Eurodollar Loan to a Base Rate Loan pursuant to Section 1.06, 1.09 or 1.10, as applicable, at a rate per annum which shall, during each Interest Period applicable thereto, be equal to the sum of the Applicable Margin plus the Eurodollar Rate for such Interest Period. (c) Overdue principal and, to the extent permitted by law, overdue interest in respect of each Loan and any other overdue amount payable hereunder shall, in each case, bear interest at a rate per annum equal to the greater of (x) 2% per annum in excess of the rate otherwise applicable to Base Rate Loans of the respective Tranche -7- 15 of Loans from time to time and (y) the rate which is 2% in excess of the rate then borne by such Loans, in each case with such interest to be payable on demand. (d) Accrued (and theretofore unpaid) interest shall be payable (i) in respect of each Base Rate Loan, quarterly in arrears on each Quarterly Payment Date, (ii) in respect of each Eurodollar Loan, on the last day of each Interest Period applicable thereto and, in the case of an Interest Period in excess of three months, on each date occurring at three month intervals after the first day of such Interest Period and (iii) in respect of each Loan, on any repayment or prepayment (on the amount repaid or prepaid), at maturity (whether by acceleration or otherwise) and, after such maturity, on demand. (e) Upon each Interest Determination Date, the Managing Agent shall determine the Eurodollar Rate for each Interest Period applicable to Eurodollar Loans and shall promptly notify the Borrower and the Banks thereof. Each such determination shall, absent manifest error, be final and conclusive and binding on all parties hereto. 1.09 Interest Periods. At the time it gives any Notice of Borrowing or Notice of Conversion in respect of the making of, or conversion into, any Eurodollar Loan (in the case of the initial Interest Period applicable thereto) or on the third Business Day prior to the expiration of an Interest Period applicable to such Eurodollar Loan (in the case of any subsequent Interest Period), the Borrower shall have the right to elect, by giving the Managing Agent notice thereof, the interest period (each an "Interest Period") applicable to such Eurodollar Loan, which Interest Period shall, at the option of the Borrower, be a one, two, three, six month period, or, to the extent available to each Bank with a Commitment under the Tranche under which such Borrowing is to be made, a nine or twelve month period; provided that: (i) all Eurodollar Loans comprising a Borrowing shall at all times have the same Interest Period; (ii) the initial Interest Period for any Eurodollar Loan shall commence on the date of Borrowing of such Eurodollar Loan (including the date of any conversion thereto from a Loan of a different Type) and each Interest Period occurring thereafter in respect of such Eurodollar Loan shall commence on the day on which the next preceding Interest Period applicable thereto expires; (iii) if any Interest Period relating to a Eurodollar Loan begins on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period, such Interest Period shall end on the last Business Day of such calendar month; -8- 16 (iv) if any Interest Period would otherwise expire on a day which is not a Business Day, such Interest Period shall expire on the next succeeding Business Day; provided, however, that if any Interest Period for a Eurodollar Loan would otherwise expire on a day which is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the next preceding Business Day; (v) no Interest Period may be selected at any time when a Default or Event of Default is then in existence; (vi) no Interest Period in respect of any Borrowing of Term Loans shall be selected which extends beyond the Maturity Date; (vii) no Interest Period in respect of any Borrowing of Revolving Loans shall be selected which extends beyond the Maturity Date; and (viii) no Interest Period in respect of any Borrowing of Term Loans shall be selected which extends beyond any date upon which a mandatory repayment of Term Loans will be required to be made under Section 4.02(b) if after giving effect to the selection of such Interest Period, the aggregate principal amount of Term Loans which have Interest Periods which will expire after such date of mandatory repayment will be in excess of the aggregate principal amount of Term Loans then outstanding less the aggregate amount of such required repayment. If upon the expiration of any Interest Period applicable to a Borrowing of Eurodollar Loans, the Borrower has failed to elect, or is not permitted to elect, a new Interest Period to be applicable to such Eurodollar Loans as provided above, the Borrower shall be deemed to have elected to convert such Eurodollar Loans into Base Rate Loans effective as of the expiration date of such current Interest Period. 1.10 Increased Costs, Illegality, etc. (a) In the event that any Bank shall have determined (which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto but, with respect to clause (i) below, may be made only by the Managing Agent): (i) on any Interest Determination Date that, by reason of any changes arising after the Second Restatement Effective Date affecting the interbank Eurodollar market, adequate and fair means do not exist for ascertaining the applicable interest rate on the basis provided for in the definition of Eurodollar Rate; or -9- 17 (ii) at any time, that such Bank shall incur increased costs or reductions in the amounts received or receivable hereunder with respect to any Eurodollar Loan because of (x) any change since the Second Restatement Effective Date in any applicable law or governmental rule, regulation, order, guideline or request (whether or not having the force of law) or in the interpretation or administration thereof and including the introduction of any new law or governmental rule, regulation, order, guideline or request, such as, for example, but not limited to: (A) a change in the basis of taxation of payment to any Bank of the principal of or interest on such Eurodollar Loan or any other amounts payable hereunder (except for changes in the rate of tax on, or determined by reference to, the net income or profits of such Bank, or any franchise tax based on the net income or profits of such Bank, in either case pursuant to the laws of the United States of America or the jurisdiction in which it is organized or in which its principal office or applicable lending office is located or any subdivision thereof or therein), but without duplication of any amounts payable in respect of Taxes pursuant to Section 4.04(a), or (B) a change in official reserve requirements, but, in all events, excluding reserves required under Regulation D to the extent included in the computation of the Eurodollar Rate and/or (y) other circumstances since the Second Restatement Effective Date affecting such Bank or the interbank Eurodollar market or the position of such Bank in such market; or (iii) at any time, that the making or continuance of any Eurodollar Loan has been made (x) unlawful by any law or governmental rule, regulation or order, (y) impossible by compliance by any Bank in good faith with any governmental request (whether or not having force of law) or (z) impracticable as a result of a contingency occurring after the Second Restatement Effective Date which materially and adversely affects the interbank Eurodollar market; then, and in any such event, such Bank (or the Managing Agent, in the case of clause (i) above) shall promptly give notice (by telephone confirmed in writing) to the Borrower and, except in the case of clause (i) above, to the Managing Agent of such determination (which notice the Managing Agent shall promptly transmit to each of the other Banks). Thereafter (x) in the case of clause (i) above, Eurodollar Loans shall no longer be available until such time as the Managing Agent notifies the Borrower and the Banks that the circumstances giving rise to such notice by the Managing Agent no longer exist, and any Notice of Borrowing or Notice of Conversion given by the Borrower with respect to Eurodollar Loans which have not yet been incurred (including by way of conversion) shall be deemed rescinded by the Borrower, (y) in the case of clause (ii) above, the Borrower shall, subject to the provisions of Section 13.15 (to the extent applicable) pay to such Bank, upon written demand therefor, such additional amounts (in the form of an increased rate of, or a different method of calculating, inter- -10- 18 est or otherwise as such Bank in its sole discretion shall determine) as shall be required to compensate such Bank for such increased costs or reductions in amounts received or receivable hereunder (a written notice as to the additional amounts owed to such Bank, showing the basis for the calculation thereof, submitted to the Borrower by such Bank in good faith shall, absent manifest error, be final and conclusive and binding on all the parties hereto) and (z) in the case of clause (iii) above, the Borrower shall take one of the actions specified in Section 1.10(b) as promptly as possible and, in any event, within the time period required by law. Each of the Managing Agent and each Bank agrees that if it gives notice to the Borrower of any of the events described in clause (i) or (iii) above, it shall promptly notify the Borrower and, in the case of any such Bank, the Managing Agent, if such event ceases to exist. If any such event described in clause (iii) above ceases to exist as to a Bank, the obligations of such Bank to make Eurodollar Loans and to convert Base Rate Loans into Eurodollar Loans on the terms and conditions contained herein shall be reinstated. (b) At any time that any Eurodollar Loan is affected by the circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and in the case of a Eurodollar Loan affected by the circumstances described in Section 1.10(a)(iii) shall) either (x) if the affected Eurodollar Loan is then being made initially or pursuant to a conversion, cancel the respective Borrowing by giving the Managing Agent telephonic notice (confirmed in writing) on the same date that the Borrower was notified by the affected Bank or the Managing Agent pursuant to Section 1.10(a)(ii) or (iii) or (y) if the affected Eurodollar Loan is then outstanding, upon at least three Business Days' written notice to the Managing Agent, require the affected Bank to convert such Eurodollar Loan into a Base Rate Loan, provided that, if more than one Bank is affected at any time, then all affected Banks must be treated the same pursuant to this Section 1.10(b). (c) If at any time after the Second Restatement Effective Date any Bank determines that the introduction of or any change in any applicable law or governmental rule, regulation, order, guideline, directive or request (whether or not having the force of law) concerning capital adequacy, or any change in interpretation or administration thereof by any governmental authority, central bank or comparable agency, will have the effect of increasing the amount of capital required or expected to be maintained by such Bank or any corporation controlling such Bank based on the existence of such Bank's Commitments hereunder or its obligations hereunder, then the Borrower shall, subject to the provisions of Section 13.15 (to the extent applicable), pay to such Bank, upon its written demand therefor, such additional amounts as shall be required to compensate such Bank or such other corporation for the increased cost to such Bank or such other corporation or the reduction in the rate of return to such Bank or such other corporation as a result of such increase of capital. In determining such additional -11- 19 amounts, each Bank will act reasonably and in good faith and will use reasonable averaging and attribution methods, provided that such Bank's reasonable good faith determination of compensation owing under this Section 1.10(c) shall, absent manifest error, be final and conclusive and binding on all the parties hereto. Each Bank, upon determining that any additional amounts will be payable pursuant to this Section 1.10(c), will give prompt written notice thereof to the Borrower, which notice shall show the basis for calculation of such additional amounts. 1.11 Compensation. The Borrower shall, subject to the provisions of Section 13.15 (to the extent applicable), compensate each Bank, upon its written request (which request shall set forth the basis for requesting such compensation), for all reasonable losses, expenses and liabilities (including, without limitation, any loss, expense or liability incurred by reason of the liquidation or reemployment of deposits or other funds required by such Bank to fund its Eurodollar Loans but excluding any loss of anticipated profit) which such Bank may sustain: (i) if for any reason (other than a default by such Bank or the Managing Agent) a Borrowing of, or conversion from or into, Eurodollar Loans does not occur on a date specified therefor in a Notice of Borrowing or Notice of Conversion (whether or not withdrawn by the Borrower or deemed withdrawn pursuant to Section 1.10(a) or (b)); (ii) if any repayment (including any repayment made pursuant to Section 4.02 or as a result of an acceleration of the Loans pursuant to Section 10) or conversion of any of its Eurodollar Loans occurs on a date which is not the last day of an Interest Period with respect thereto; (iii) if any prepayment of any of its Eurodollar Loans is not made on any date specified in a notice of prepayment given by the Borrower; or (iv) as a consequence of (x) any other default by the Borrower to repay its Loans when required by the terms of this Agreement or any Note held by such Bank or (y) any election made pursuant to Section 1.10(b). 1.12 Change of Lending Office. Each Bank agrees that upon the occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or (iii), Section 1.10(c), Section 2.05 or Section 4.04 with respect to such Bank, it will, if requested by the Borrower, use reasonable efforts (subject to overall policy considerations of such Bank) to designate another lending office for any Loans affected by such event, provided that such designation is made on such terms that such Bank and its lending office suffer no economic, legal or regulatory disadvantage, with the object of avoiding the consequence of the event giving rise to the operation of such Section. Nothing in this Section 1.12 shall affect or postpone any of the obligations of the Borrower or the right of any Bank provided in Sections 1.10, 2.05 and 4.04. 1.13 Replacement of Banks. (x) If any Bank becomes a Defaulting Bank or otherwise defaults in its obligations to make Loans or fund Unpaid Drawings, (y) upon the occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or -12- 20 (iii), Section 1. 10(c), Section 2.05 or Section 4.04 with respect to any Bank which results in such Bank charging to the Borrower increased costs in excess of those being generally charged by the other Banks or (z) as provided in Section 13.12(b) in the case of certain refusals by a Bank (other than a Bank whose commitments are terminated in accordance with Section 3.02(b) and/or whose Loans are repaid in accordance with Section 4.01(v)) to consent to certain proposed changes, waivers, discharges or terminations with respect to this Agreement which have been approved by the Required Banks, the Borrower shall have the right, if no Default or Event of Default will exist immediately after giving effect to the respective replacement, to either replace such Bank (the "Replaced Bank") with one or more other Eligible Transferee or Transferees, none of whom shall constitute a Defaulting Bank at the time of such replacement (collectively, the "Replacement Bank") reasonably acceptable to the Managing Agent or, at the option of the Borrower, to replace only (a) the Term Loan Commitment or Term Loans of the Replaced Bank with an identical Tenn Loan Commitment or Term Loans provided by the Replacement Bank or (b) the Revolving Loan Commitment (and outstandings pursuant thereto) of the Replaced Bank with an identical Revolving Loan Commitment provided by the Replacement Bank, provided that (i) at the time of any replacement pursuant to this Section 1.13, the Replacement Bank shall enter into one or more Assignment and Assumption Agreements pursuant to Section 13.04(b) (and with all fees payable pursuant to said Section 13.04(b) to be paid by the Replacement Bank) pursuant to which the Replacement Bank shall acquire all of the Commitments and outstanding Loans (or, in the case of the replacement of only (a) the Term Loan Commitment or Term Loans, the Term Loan Commitment or Term Loans or (b) the Revolving Loan Commitment, the Revolving Loan Commitment and outstanding Revo l ving Loans) of, and in each case (except for the replacement of only the outstanding Term Loans) participations in Letters of Credit by, the Replaced Bank and, in connection therewith, shall pay to (x) the Replaced Bank in respect thereof an amount equal to the sum of (A) an amount equal to the principal of, and all accrued interest on, all outstanding Loans (or of the Loans of the respective Tranche being replaced) of the Replaced Bank, (B) except for the replacement of only the outstanding Term Loans, an amount equal to all Unpaid Drawings that have been funded by (and not reimbursed to) such Replaced Bank, together with all then unpaid interest with respect thereto at such time and (C) an amount equal to all accrued, but theretofore unpaid, Fees owing to the Replaced Bank (but only with respect to the relevant Tranche, in the case of all Tranches of Loans being held by the respective Replaced Bank) pursuant to Section 3.01 and (y) except in the case of the replacement of only the outstanding Term Loans of the Replaced Bank, any Issuing Bank an amount equal to such Replaced Bank's Adjusted RL Percentage (for this purpose, determined as if the adjustment described in clause (y) of the immediately succeeding sentence had been made with respect to such Replaced Bank) of any Unpaid Drawing (which at such time remains an Unpaid Drawing) to the extent such amount was not theretofore funded by -13- 21 such Replaced Bank, and (ii) all obligations of the Borrower owing to the Replaced Bank (other than those specifically described in clause (i) above in respect of which the assignment purchase price has been, or is concurrently being, paid) shall be paid in full to such Replaced Bank concurrently with such replacement. Upon the execution of the respective Assignment and Assumption Agreements, the payment of amounts referred to in clauses (i) and (ii) above and, if so requested by the Replacement Bank, delivery to the Replacement Bank of the appropriate Note or Notes executed by the Borrower, (x) the Replacement Bank shall become a Bank hereunder and, unless the respective Replaced Bank continues to have outstanding Loans or Commitments hereunder, the Replaced Bank shall cease to constitute a Bank hereunder, except with respect to indemnification provisions under this Agreement (including, without limitation, Sections 1.10, 1.11, 2.05, 4.04, 12.06 and 13.01, as the same may be limited by Section 13.15 (to the extent applicable)), which shall survive as to such Replaced Bank and (y) in the case of a replacement of a Defaulting Bank with a Non-Defaulting Bank, the Adjusted RL Percentages of the Banks shall be automatically adjusted at such time to give effect to such replacement (and to give effect to the replacement of a Defaulting Bank with one or more Non-Defaulting Banks). SECTION 2. Letters of Credit. 2.01 Letters of Credit. (a) Subject to and upon the terms and conditions set forth herein, the Borrower may request that any Issuing Bank issue, at any time and from time to time on and after the Second Restatement Effective Date and prior to the Maturity Date, (x) for the account of the Borrower and for the benefit of any holder (or any trustee, agent or other similar representative for any such holders) of L/C Supportable Obligations of the Borrower or any of its Subsidiaries, an irrevocable sight standby letter of credit, in a form customarily used by such Issuing Bank or in such other form as has been approved by such Issuing Bank (each such standby letter of credit, a "Standby Letter of Credit") in support of such L/C Supportable Obligations and (y) for the account of the Borrower and for the benefit of sellers of goods to the Borrower or any of its Subsidiaries, an irrevocable sight commercial letter of credit in a form customarily used by such Issuing Bank (each such commercial letter of credit, a "Trade Letter of Credit" and each such Trade Letter of Credit and each Standby Letter of Credit, a "Letter of Credit") in support of commercial transactions of the Borrower and its Subsidiaries. (b) Each Issuing Bank may agree in its sole discretion, and BTCo hereby agrees that, in the event a requested Letter of Credit is not issued by one of the other Issuing Banks, it will (subject to the terms and conditions contained herein), at any time and from time to time on or after the Second Restatement Effective Date and prior to the Maturity Date, following its receipt of the respective Letter of Credit Request, issue -14- 22 for the account of the Borrower one or more Letters of Credit (x) in the case of Standby Letters of Credit, in support of such L/C Supportable Obligations of the Borrower or any of its Subsidiaries and (y) in the case of Trade Letters of Credit, in support of sellers of goods as referenced in Section 2.01(a), provided that the respective Issuing Bank shall be under no obligation to issue any Letter of Credit of the types described above if at the time of such issuance: (i) any order, judgment or decree of any governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Issuing Bank from issuing such Letter of Credit or any requirement of law applicable to such Issuing Bank or any request or directive (whether or not having the force of law) from any governmental authority with jurisdiction over such Issuing Bank shall prohibit, or request that such Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuing Bank with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuing Bank is not otherwise compensated) not in effect on the date hereof, or any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuing Bank as of the date hereof and which such Issuing Bank in good faith deems material to it; or (ii) such Issuing Bank shall have received notice from any Bank prior to the issuance of such Letter of Credit of the type described in the second sentence of Section 2.02(b). (c) Notwithstanding the foregoing, (i) no Letter of Credit shall be issued the Stated Amount of which, when added to the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time would exceed either (x) $40,000,000 minus the aggregate amount of cash earnest money deposits outstanding at such time pursuant to Section 9.01(xix) or (y) when added to the aggregate outstanding principal amount of all Revolving Loans of Non-Defaulting Banks, the Adjusted Total Revolving Loan Commitment; (ii) each Letter of Credit shall be denominated in Dollars; and (iii) each Letter of Credit shall by its terms terminate (A) in the case of Standby Letters of Credit, on or before the earlier of (x) the date which occurs 12 months after the date of the issuance thereof (although any such Letter of Credit may be extendable for successive periods of up to 12 months, but not beyond July 2, 2004, on terms acceptable to the Issuing Bank thereof) and (y) July 2, 2004 and (B) in the case of Trade Letters of Credit, on or before the earlier of (x) the date which occurs 180 days after the date of issuance thereof and (y) the date which is 30 days prior to July 2, 2004. -15- 23 (d) Schedule II contains a description of all letters of credit issued by BTCo pursuant to the Existing Credit Agreement and which are to remain outstanding on the Second Restatement Effective Date. Each Existing Letter of Credit, including any extension thereof, issued by BTCo shall constitute a "Letter of Credit" for all purposes of this Agreement. Each Existing Letter of Credit shall be deemed issued for purposes of Sections 3.01(b) and 3.01(c) on the Second Restatement Effective Date. 2.02 Letter of Credit Requests. (a) Whenever the Borrower desires that a Letter of Credit be issued for its account, the Borrower shall give the Managing Agent and the respective Issuing Bank at least two Business Days' (or such shorter period as is acceptable to the respective Issuing Bank) written notice thereof. In the case of Letters of Credit to be issued pursuant to Section 2.01, each notice shall be in the form of Exhibit C (each a "Letter of Credit Request"). (b) The making of each Letter of Credit Request shall be deemed to be a representation and warranty by the Borrower that such Letter of Credit may be issued in accordance with, and will not violate the requirements of, Section 2.01(c). Unless the respective Issuing Bank has received notice from any Bank before it issues a Letter of Credit that one or more of the conditions specified in Section 5 or Section 6 are not then satisfied, or that the issuance of such Letter of Credit would violate Section 2.01(c), then such Issuing Bank may issue the requested Letter of Credit for the account of the Borrower in accordance with such Issuing Bank's usual and customary practices. Upon its issuance of any Standby Letter of Credit, such Issuing Bank shall promptly notify each Bank participating therein of such issuance, which notice shall be accompanied by a copy of the Letter of Credit actually issued and any amendments thereto. For Trade Letters of Credit on which the Issuing Bank is other than the Managing Agent, the Issuing Bank will send to the Managing Agent by facsimile transmission, promptly on the first Business Day of each week, the daily aggregate Stated Amounts of Trade Letters of Credit available during the preceding week. The Managing Agent will send to each Bank with a Revolving Loan Commitment, after each calendar month end and upon each Letter of Credit Fee payment, a report setting forth for the relevant period the daily aggregate Stated Amount under Trade Letters of Credit of all Issuing Banks during such period. 2.03 Letter of Credit Participations. (a) Immediately upon the issuance by any Issuing Bank of any Letter of Credit, such Issuing Bank shall be deemed to have sold and transferred to each Bank with a Revolving Loan Commitment, other than such Issuing Bank (each such Bank, in its capacity under this Section 2.03, a "Participant"), and each such Participant shall be deemed irrevocably and unconditionally to have purchased and received from such Issuing Bank, without recourse or warranty, an undivided interest and participation, to the extent of such Participant's Adjusted RL -16- 24 Percentage, in such Letter of Credit, each drawing made thereunder and the obligations of the Borrower under this Agreement with respect thereto, and any security therefor or guaranty pertaining thereto (although the Letter of Credit Fee shall be payable directly to the Managing Agent for the account of the Participants as provided in Section 3.01(b) and the Participants shall have no right to receive any portion of any Facing Fees). Upon any change in the respective Revolving Loan Commitments or Adjusted RL Percentages of the Banks pursuant to Section 1.13 or 13.04 or as a result of a Bank Default, it is hereby agreed that, with respect to all such outstanding Letters of Credit and Unpaid Drawings, there shall be an automatic adjustment to the participations pursuant to this Section 2.03 to reflect the new Adjusted RL Percentages of the assignor and assignee Bank or of all Banks with respective Revolving Loan Commitments. (b) In determining whether to pay under any Letter of Credit, such Issuing Bank shall have no obligation relative to the other Banks other than to confirm that any documents required to be delivered under such Letter of Credit appear to have been delivered and that they appear to substantially comply on their face with the requirements of such Letter of Credit. Any action taken or omitted to be taken by any Issuing Bank under or in connection with any Letter of Credit if taken or omitted in the absence of gross negligence or willful misconduct, shall not create for such Issuing Bank any resulting liability to the Borrower or any Bank. (c) In the event that any Issuing Bank makes any payment under any Letter of Credit and the Borrower shall not have reimbursed such amount in full to such Issuing Bank pursuant to Section 2.04(a), such Issuing Bank shall promptly notify the Managing Agent, which shall promptly notify each Participant of such failure, and each Participant shall promptly and unconditionally pay to such Issuing Bank the amount of such Participant's Adjusted RL Percentage of such unreimbursed payment in Dollars and in same day funds. If the Managing Agent so notifies, prior to 11:00 A.M. (New York time) on any Business Day, any Participant required to fund a payment under a Letter of Credit, such Participant shall make available to such Issuing Bank in Dollars such Participant's Adjusted RL Percentage of the amount of such payment on such Business Day in same day funds. If and to the extent such Participant shall not have so made its Adjusted RL Percentage of the amount of such payment available to such Issuing Bank, such Participant agrees to pay to such Issuing Bank, forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to such Issuing Bank at the overnight Federal Funds Rate. The failure of any Participant to make available to such Issuing Bank its Adjusted RL Percentage of any payment under any Letter of Credit shall not relieve any other Participant of its obligation hereunder to make available to such Issuing Bank its Adjusted RL Percentage of any Letter of Credit on the date required, as specified -17- 25 above, but no Participant shall be responsible for the failure of any other Participant to make available to such Issuing Bank such other Participant's Adjusted RL Percentage of any such payment. (d) Whenever any Issuing Bank receives a payment of a reimbursement obligation as to which it has received any payments from the Participants pursuant to clause (c) above, such Issuing Bank shall pay to each Participant which has paid its Adjusted RL Percentage thereof, in Dollars and in same day funds, an amount equal to such Participant's share (based upon the proportionate aggregate amount originally funded by such Participant to the aggregate amount funded by all Participants) of the principal amount of such reimbursement obligation and interest thereon accruing after the purchase of the respective participations. (e) The obligations of the Participants to make payments to each Issuing Bank with respect to Letters of Credit issued by it shall be irrevocable and not subject to any qualification or exception whatsoever and shall be made in accordance with the terms and conditions of this Agreement under all circumstances, including, without limitation, any of the following circumstances: (i) any lack of validity or enforceability of this Agreement or any of the other Credit Documents; (ii) the existence of any claim, setoff, defense or other right which the Borrower or any of its Subsidiaries may have at any time against a beneficiary named in a Letter of Credit, any transferee of any Letter of Credit (or any Person for whom any such transferee may be acting), the Managing Agent, any Issuing Bank, any Participant, or any other Person, whether in connection with this Agreement, any Letter of Credit, the transactions contemplated herein or any unrelated transactions (including any underlying transaction between the Borrower and the beneficiary named in any such Letter of Credit); (iii) any draft, certificate or any other document presented under any 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; (iv) the surrender or impairment of any security for the performance or observance of any of the terms of any of the Credit Documents; or (v) the occurrence of any Default or Event of Default. -18- 26 2.04 Agreement to Repay Letter of Credit Drawings. (a) The Borrower hereby agrees to reimburse the respective Issuing Bank, by making payment directly to such Issuing Bank in immediately available funds, for any payment or disbursement made by it under any Letter of Credit (each such amount, so paid until reimbursed, an "Unpaid Drawing"), no later than three Business Days after the date of such payment or disbursement, with interest on the amount so paid or disbursed by such Issuing Bank, to the extent not reimbursed prior to 12:00 Noon (New York time) on the date of such payment or disbursement, from and including the date paid or disbursed to but excluding the date such Issuing Bank was reimbursed by the Borrower therefor at a rate per annum which shall be the Base Rate in effect from time to time plus the Applicable Margin for Revolving Loans maintained as Base Rate Loans; provided, however, to the extent such amounts are not reimbursed prior to 12:00 Noon (New York time) on the fifth Business Day following such payment or disbursement, interest shall thereafter accrue on the amounts so paid or disbursed by such Issuing Bank (and until reimbursed by the Borrower) at a rate per annum which shall be the Base Rate in effect from time to time plus the Applicable Margin for Revolving Loans maintained as Base Rate Loans plus 2%, in each such case, with interest to be payable on demand. The respective Issuing Bank shall give the Borrower prompt notice of each Drawing under any Letter of Credit, provided that the failure to give any such notice shall in no way affect, impair or diminish the Borrower's obligations hereunder. (b) The obligations of the Borrower under this Section 2.04 to reimburse the respective Issuing Bank with respect to drawings on Letters of Credit (each, a "Drawing") (including, in each case, interest thereon) shall be absolute and unconditional under any and all circumstances and irrespective of any setoff, counterclaim or defense to payment which the Borrower may have or have had against any Bank (including in its capacity as the issuer of the Letter of Credit or as Participant), or any nonapplication or misapplication by the beneficiary of the proceeds of such Drawing, the respective Issuing Bank's only obligation to the Borrower being to confirm that any documents required to be delivered under such Letter of Credit appear to have been delivered and that they appear to comply on their face with the requirements of such Letter of Credit. Any action taken or omitted to be taken by any Issuing Bank under or in connection with any Letter of Credit if taken or omitted in the absence of gross negligence or willful misconduct, shall not create for such Issuing Bank any resulting liability to the Borrower. 2.05 Increased Costs. If at any time after the Second Restatement Effective Date, the introduction of or any change in any applicable law, rule, regulation, order, guideline or request or in the interpretation or administration thereof by any governmental authority charged with the interpretation or administration thereof, or compliance by any Issuing Bank or any Participant, or any corporation controlling -19- 27 such Person, with any request or directive by any such authority (whether or not having the force of law), shall either (i) impose, modify or make applicable any reserve, deposit, capital adequacy or similar requirement against letters of credit issued by any Issuing Bank or participated in by any Participant, or (ii) impose on any Issuing Bank or any Participant, or any corporation controlling such Person, any other conditions relating, directly or indirectly, to this Agreement or any Letter of Credit; and the result of any of the foregoing is to increase the cost to any Issuing Bank or any Participant of issuing, maintaining or participating in any Letter of Credit, or reduce the amount of any sum received or receivable by any Issuing Bank or any Participant hereunder or reduce the rate of return on its capital with respect to Letters of Credit (except for changes in the rate of tax on, or determined by reference to, the net income or profits of such Issuing Bank or such Participant, or any corporation controlling such Person, or any franchise tax based on the net income or profits of such Bank or Participant, or any corporation controlling such Person, in either case pursuant to the laws of the United States of America, the jurisdiction in which it is organized or in which its principal office or applicable lending office is located or any subdivision thereof or therein), but without duplication of any amounts payable in respect of taxes pursuant to Section 4.04(a), then, upon demand to the Borrower by such Issuing Bank or any Participant (a copy of which demand shall be sent by such Issuing Bank or such Participant to the Managing Agent) and subject to the provisions of Section 13.15 (to the extent applicable), the Borrower shall pay to such Issuing Bank or such Participant such additional amount or amounts as will compensate such Bank for such increased cost or reduction in the amount receivable or reduction on the rate of return on its capital. Any Issuing Bank or any Participant, upon determining that any additional amounts will be payable pursuant to this Section 2.05, will give prompt written notice thereof to the Borrower, which notice shall include a certificate submitted to the Borrower by such Issuing Bank or such Participant (a copy of which certificate shall be sent by such Issuing Bank or such Participant to the Managing Agent), setting forth in reasonable detail the basis for the calculation of such additional amount or amounts necessary to compensate such Issuing Bank or such Participant. The certificate required to be delivered pursuant to this Section 2.05 shall, if delivered in good faith and absent manifest error, be final and conclusive and binding on the Borrower. SECTION 3. Commitment Commission; Fees, Reductions of Commitment. 3.01 Fees. (a) The Borrower agrees to pay the Managing Agent for distribution to each Non-Defaulting Bank with a Revolving Loan Commitment a commitment commission (the "Commitment Commission") for the period from the Second Restatement Effective Date to and including the Maturity Date (or such earlier date as the Total Revolving Loan Commitment shall have been terminated), computed -20- 28 at a rate for each day equal to (x) if on the relevant Quarterly Payment Date or the Maturity Date (or such earlier date as the Total Revolving Loan Commitment shall have been terminated) the Leverage Ratio is equal to or greater than 4.5 to 1, 3/8 of 1% per annum or (y) if on the relevant Quarterly Payment Date or the Maturity Date (or such earlier date as the Total Revolving Loan Commitment shall have been terminated) the Leverage Ratio is less than 4.5 to 1, 1/4 of 1% per annum, in each case on the daily average Unutilized Revolving Loan Commitment of such Non-Defaulting Bank. Accrued Commitment Commission shall be due and payable quarterly in arrears on each Quarterly Payment Date and on the Maturity Date or such earlier date upon which the Total Revolving Loan Commitment is terminated. (b) The Borrower agrees to pay to the Managing Agent for distribution to each Non-Defaulting Bank with a Revolving Loan Commitment, as the case may be (based on their respective Adjusted RL Percentages), a fee in respect of each Letter of Credit issued hereunder (the "Letter of Credit Fee"), for the period from and including the date of issuance of such Letter of Credit, to and including the termination of such Letter of Credit computed at a rate per annum equal to the Applicable Margin for Revolving Loans maintained as Eurodollar Loans as in effect from time to time on the daily Stated Amount of such Letter of Credit. Accrued Letter of Credit Fees shall be due and payable quarterly in arrears on each Quarterly Payment Date and upon the first day on or after the termination of the Total Revolving Loan Commitment upon which no Letters of Credit remain outstanding. (c) The Borrower agrees to pay to the respective Issuing Bank, for its own account, a facing fee in respect of each Letter of Credit issued for its account hereunder (the "Facing Fee") for the period from and including the date of issuance of such Letter of Credit to and including the termination of such Letter of Credit, computed at a rate equal to 1/4 of 1% per annum of the daily Stated Amount of such Letter of Credit; provided that in no event shall the annual Facing Fee be less than $500. Accrued Facing Fees shall be due and payable quarterly in arrears on each Quarterly Payment Date and on the date upon which the Total Revolving Loan Commitment has been terminated and no Letters of Credit remain outstanding. (d) The Borrower shall pay, upon each payment under, issuance of, or amendment to, any Letter of Credit, such amount as shall at the time of such event be the administrative charge which the respective Issuing Bank is generally imposing in connection with such occurrence with respect to letters of credit. (e) The Borrower shall pay to the Managing Agent, for its own account, such other fees as have been agreed to in writing by the Borrower and the Managing Agent. -21- 29 3.02 Voluntary Termination and Reduction of Commitments. (a) Upon at least two Business Days' prior written notice (or telephonic notice confirmed in writing) to the Managing Agent at its Notice Office (which notice the Managing Agent shall promptly transmit to each of the Banks), the Borrower shall have the right, at any time or from time to time, without premium or penalty, to terminate or partially reduce the Total Unutilized Revolving Loan Commitment, in whole or in part, provided that (x) each such reduction shall apply proportionately to permanently reduce the Revolving Loan Commitment of each Bank with a Revolving Loan Commitment (y) any partial reduction pursuant to this Section 3.02 shall be in integral multiples of $500,000 and (z) the reduction to the Total Unutilized Revolving Loan Commitment shall in no case be in an amount which would cause the Revolving Loan Commitment of any Bank to be reduced (as required by the preceding clause (x)) by an amount which exceeds the Unutilized Revolving Loan Commitment of such Bank as in effect immediately before giving effect to such reduction. (b) In the event of certain refusals by a Bank as provided in Section 13.12(b) to consent to certain proposed changes, waivers, discharges or terminations with respect to this Agreement which have been approved by the Required Banks, the Borrower may, upon five Business Days' written notice to the Managing Agent at its Notice Office (which notice the Managing Agent shall promptly transmit to each of the Banks) terminate the entire Revolving Loan Commitment of such Bank so long as (i) all Loans, together with accrued and unpaid interest, Fees and other amounts, owing to such Bank (other than amounts owing in respect of Term Loans maintained by such Bank, if such Term Loans are not being repaid pursuant to Section 13.12(b)) are repaid concurrently with the effectiveness of such termination (at which time Schedule I shall be deemed modified to reflect such changed amounts), and at such time, unless the respective Bank continues to have outstanding Term Loans hereunder, such Bank shall no longer constitute a "Bank" for purposes of this Agreement, except with respect to indemnifications under this Agreement (including, without limitation, Sections 1.10, 1.11, 2.05, 4.04, 12.06 and 13.01, as the same may be limited by Section 13.15 (to the extent applicable)), which shall survive as to such repaid Bank and (ii) the Managing Agent and each other Bank which will be party to this Agreement after giving effect to such change, waiver, discharge or termination with respect to this Agreement consents to such termination of Revolving Loan Commitment and repayment of Loans. 3.03 Mandatory Reduction of Commitments. (a) Unless the Second Restatement Effective Date shall have occurred on or before July 31, 1997, the Total Commitment (and the Term Loan Commitment and the Revolving Loan Commitment of each Bank) shall terminate in its entirety. -22- 30 (b) In addition to any other mandatory commitment reductions pursuant to this Section 3.03, the Total Term Loan Commitment (and the Term Loan Commitment of each Bank) shall terminate in its entirety on the Second Restatement Effective Date (after giving effect to the making of Term Loans on such date) (c) In addition to any other mandatory commitment reductions pursuant to this Section 3.03, the Total Revolving Loan Commitment (and the Revolving Loan Commitment of each Bank) shall terminate in its entirety on the Maturity Date. (d) In addition to any other mandatory commitment reductions pursuant to this Section 3.03, on each date after the Second Restatement Effective Date upon which a mandatory repayment of Term Loans pursuant to Section 4.02(e) is required (and exceeds in amount the aggregate principal amount of Term Loans then outstanding) or would be required if Term Loans were then outstanding, the Total Revolving Loan Commitment shall be permanently reduced by the amount, if any, by which the amount required to be applied pursuant to said Section (determined as if an unlimited amount of Term Loans were actually outstanding) exceeds the aggregate principal amount of Term Loans then outstanding. (e) Each reduction to the Total Term Loan Commitment and/or the Total Revolving Loan Commitment pursuant to this Section 3.03 (or pursuant to Section 4.02) shall be applied proportionately to reduce the Term Loan Commitment or the Revolving Loan Commitment, as the case may be, of each Bank with such a Commitment. SECTION 4. Prepayments; Payments; Taxes. 4.01 Voluntary Prepayments. The Borrower shall have the right to prepay the Loans, without premium or penalty, in whole or in part at any time and from time to time on the following terms and conditions: (i) the Borrower shall give the Managing Agent prior to 12:00 Noon (New York time) at its Notice Office (x) at least one Business Day's prior written notice (or telephonic notice promptly confirmed in writing) of its intent to prepay Base Rate Loans and (y) at least three Business Days' prior written notice (or telephonic notice promptly confirmed in writing) of its intent to prepay Eurodollar Loans, whether Term Loans or Revolving Loans shall be prepaid, the amount of such prepayment and the Types of Loans to be prepaid and, in the case of Eurodollar Loans, the specific Borrowing or Borrowings pursuant to which made, which notice the Managing Agent shall promptly transmit to each of the Banks; (ii) each prepayment shall be in an aggregate principal amount of at least $100,000, provided that if any partial prepayment of Eurodollar Loans made pursuant to any Borrowing shall reduce the outstanding Eurodollar Loans made pursuant to such Borrowing to an amount less than (1) in the case of Term Loans, $2,000,000, and (2) -23- 31 in the case of Revolving Loans, $250,000, then such Borrowing may not be continued as a Borrowing of Eurodollar Loans and any election of an Interest Period with respect thereto given by the Borrower shall have no force or effect; (iii) prepayments of Eurodollar Loans made pursuant to this Section 4.01 may only be made on the last day of an Interest Period applicable thereto (except in connection with payments made pursuant to clause (v) below); (iv) each prepayment in respect of any Loans made pursuant to a Borrowing shall, except as provided in clauses (v) and (vi) below, be applied pro rata among the Banks which made such Loans; (v) in the event of certain refusals by a Bank as provided in Section 13.12(b) to consent to certain proposed changes, waivers, discharges or terminations with respect to this Agreement which have been approved by the Required Banks, the Borrower may, upon five Business Days' written notice to the Managing Agent at its Notice Office (which notice the Managing Agent shall promptly transmit to each of the Banks) repay all Loans, together with accrued and unpaid interest, Fees and other amounts, owing to such Bank (or owing to such Bank with respect to each Tranche which gave rise to the need to obtain such Bank's individual consent) in accordance with said Section 13.12(b) so long as (A) in the case of the repayment of Revolving Loans of any Bank pursuant to this clause (v), the Revolving Loan Commitment of such Bank, is terminated concurrently with such repayment (at which time Schedule I shall be deemed modified to reflect such changed amounts), and (B) the Managing Agent and each other Bank which will be party to this Agreement after giving effect to such change, waiver, discharge or termination with respect to this Agreement consents to such repayment of Loans and such termination of Revolving Loan Commitment; (vi) at the Borrower's election in connection with any prepayment of Revolving Loans, such prepayment shall not be applied to the Revolving Loans of a Defaulting Bank; and (vii) each voluntary prepayment of Term Loans made pursuant to this Section 4.01 (other than prepayments made pursuant to preceding clauses (v) and (vi)) shall be applied to reduce the then remaining Scheduled Repayments pro rata based upon the then remaining number of Scheduled Repayments after giving effect to all prior reductions thereto; provided that if the amount to be applied to any Scheduled Repayment (whether pursuant to preceding clause (vii) or as a result of this proviso) would exceed the then remaining amount of such Scheduled Repayment, then an amount equal to such excess shall be applied to reduce the other then remaining Scheduled Repayments pro rata based upon the then remaining number of such Scheduled Repayments after giving effect to all prior reductions thereto (including the amount of prepayments theretofore allocated pursuant to preceding clause (vii) and this proviso). 4.02 Mandatory Repayments and Commitment Reductions. (a) (i) On any day on which the sum of the aggregate outstanding principal amount of the Revolving Loans made by the Non-Defaulting Banks and the Letter of Credit Outstandings exceeds the Adjusted Total Revolving Loan Commitment as then in effect, the -24- 32 Borrower shall prepay on such date principal on Revolving Loans of the Non- Defaulting Banks in an amount equal to such excess. If, after giving effect to the prepayment of all Revolving Loans of Non-Defaulting Banks, the aggregate amount of the Letter of Credit Outstandings exceeds the Adjusted Total Revolving Loan Commitment as then in effect, the Borrower shall pay to the Managing Agent at the Payment Office on such date an amount of cash or Cash Equivalents equal to the amount of such excess (up to a maximum amount equal to the Letter of Credit Outstandings at such time), such cash or Cash Equivalents to be held as security for all obligations of the Borrower to Non-Defaulting Banks hereunder in a cash collateral account to be established by the Managing Agent. (ii) On any day on which the aggregate outstanding principal amount of the Revolving Loans made by any Defaulting Bank exceeds the Revolving Loan Commitment of such Defaulting Bank, the Borrower shall prepay principal of Revolving Loans of such Defaulting Bank in an amount equal to such excess. (iii) On any day on which Holdings or any of its Subsidiaries receives Net Sale Proceeds not required to be applied as a mandatory prepayment of Term Loans pursuant to the operation of clauses (i) and (ii) of the first proviso to Section 4.02(e) or required to be applied as a mandatory repayment of the Bridge Financing, such Net Sale Proceeds shall be applied to pay outstanding principal of Revolving Loans to the extent of such outstandings in accordance with Section 4.02(i). (b) In addition to any other mandatory repayments or commitment reductions pursuant to this Section 4.02, on each date set forth below, the Borrower shall be required to repay that principal amount of Term Loans, to the extent then outstanding, as is set forth opposite such date (each such repayment, as the same may be reduced as provided in Sections 4.01 and 4.02(i), a "Scheduled Repayment"):
Scheduled Repayment Date Amount ------------------------ ------ Quarterly Payment Date in September 1997 $0 Quarterly Payment Date in December 1997 $0 Quarterly Payment Date in March 1998 $0 Quarterly Payment Date in June 1998 $0 Quarterly Payment Date in September 1998 $10,000,000 Quarterly Payment Date in December 1998 $10,000,000 Quarterly Payment Date in March 1999 $10,000,000 Quarterly Payment Date in June 1999 $10,000,000
-25- 33 Quarterly Payment Date in September 1999 $15,000,000 Quarterly Payment Date in December 1999 $15,000,000 Quarterly Payment Date in March 2000 $15,000,000 Quarterly Payment Date in June 2000 $15,000,000 Quarterly Payment Date in September 2000 $15,000,000 Quarterly Payment Date in December 2000 $15,000,000 Quarterly Payment Date in March 2001 $15,000,000 Quarterly Payment Date in June 2001 $15,000,000 Quarterly Payment Date in September 2001 $15,000,000 Quarterly Payment Date in December 2001 $15,000,000 Quarterly Payment Date in March 2002 $15,000,000 Quarterly Payment Date in June 2002 $15,000,000 Quarterly Payment Date in September 2002 $20,000,000 Quarterly Payment Date in December 2002 $20,000,000 Quarterly Payment Date in March 2003 $20,000,000 Quarterly Payment Date in June 2003 $20,000,000 Quarterly Payment Date in September 2003 $25,000,000 Quarterly Payment Date in December 2003 $25,000,000 Quarterly Payment Date in March 2004 $25,000,000 Maturity Date $25,000,000
; provided that in the event the aggregate principal amount of Term Loans incurred at the time that the Total Term Loan Commitment is terminated in accordance with Section 3.03(b) is less than $400,000,000, an amount equal to such deficiency shall be applied to reduce the Scheduled Repayments pro rata based on the then remaining principal amount of each such Scheduled Repayment. (c) In addition to any other mandatory repayments or commitment reductions pursuant to this Section 4.02, on each date after the Second Restatement Effective Date upon which Holdings or any of its Subsidiaries receives any proceeds from any sale or issuance of its equity (other than (i) proceeds received from the issuance of shares of Holdings Common Stock as a result of the exercise of options issued (x) pursuant to the Dinetz Employment Contract or the agreements granting certain options to Ms. Matrice Ellis-Kirk, Mr. Marvin Dinetz, Mr. Eric W. Neumann, Mr. Jeffrey A. Marcus and Mr. John H. Massey as in effect on the Second Restatement Effective Date, (y) pursuant to the Employee Stock Option Plan or (z) as a result of any re- -26- 34 issuance of Holdings Common Stock to new employees pursuant to, and as permitted by Section 9.03(iii)(B)(z) to the extent that the aggregate proceeds (after deduction of amounts used to purchase Holdings Common Stock in the case of reissuances of the type described in Section 9.03(iii)(B)(z) excluded pursuant to this clause (i)) do not exceed $2,500,000 in any fiscal year of Holdings and (ii) proceeds received from any Permitted Issuance), an amount equal to 100% of the cash proceeds of the respective sale or issuance (net of all reasonable costs associated therewith, including, without limitation, all due diligence costs and expenses paid for, or reimbursed by, Holdings and/or any of its Subsidiaries, underwriting or similar fees, discounts and commissions, attorneys' fees and expenses paid for, or reimbursed by, Holdings and/or any of its Subsidiaries and other direct costs associated therewith) not otherwise applied to make mandatory prepayments of outstandings under the Bridge Financing permitted pursuant to Section 9.11 shall be applied as a mandatory repayment and/or commitment reduction in accordance with the requirements of Sections 4.02(h) and (i). (d) In addition to any other mandatory repayments or commitment reductions pursuant to this Section 4.02, on each date after the Second Restatement Effective Date upon which Holdings or any of its Subsidiaries receives any proceeds from any incurrence by Holdings or any of its Subsidiaries of Indebtedness for borrowed money (other than Indebtedness for borrowed money permitted to be incurred pursuant to Section 9.04 as such Section is in effect on the Second Restatement Effective Date), an amount equal to 100% of the cash proceeds of the respective incurrence of Indebtedness (net of all reasonable costs associated therewith, including, without limitation, all due diligence costs and expenses paid for, or reimbursed by, Holdings and/or any of its Subsidiaries, any underwriting or similar fees, discounts and commissions, attorneys' fees and expenses paid for, or reimbursed by, Holdings and/or any of its Subsidiaries, all financing and/or commitment fees and other direct costs associated therewith) not otherwise applied to make Dividends permitted pursuant to Section 9.03(xi) shall be applied as a mandatory repayment and/or commitment reduction in accordance with the requirements of Sections 4.02(h) and (i). (e) In addition to any other mandatory repayments or commitment reductions pursuant to this Section 4.02, on each date after the Second Restatement Effective Date upon which Holdings or any of its Subsidiaries receives proceeds from any sale of assets (including capital stock and securities held thereby, but excluding sales of assets to the extent permitted by Sections 9.02(ii), (v), (vi), (vii), (ix), (xi), (xii), (xiii), (xv), (xvi) and (xvii)); an amount equal to 100% of the Net Sale Proceeds therefrom shall be applied as a mandatory repayment and/or commitment reduction in accordance with the requirements of Sections 4.02(h) and (i), provided, that so long as no Default or Event of Default then exists, and subject to the operation of Section 4.02(a)(iii), (i) (x) if such Net Sale Proceeds are received on or prior to March 31, 1998 and the Leverage Ratio on the date of receipt thereof is less than 7.00:1.00 or (y) -27- 35 if such Net Sale Proceeds are received after March 31, 1998 and the Leverage Ratio on the date of receipt thereof is less than 6.50:1.00, no such mandatory commitment reduction shall be required and (ii) the Net Sale Proceeds of the sale of any of the Stations (whether as an asset sale, stock transfer, merger or otherwise (including sales or swaps of Stations pursuant to the sales, Station Swaps or Stock Swaps, respectively effected pursuant to Section 9.02(viii) or (ix))) shall not be required to be so applied on the date of receipt thereof to the extent the Borrower has delivered a certificate to the Managing Agent on or prior to such date stating that such Net Sale Proceeds shall be reinvested or shall be committed to be reinvested in radio stations (and related assets) or 100% of the capital stock or other equity interests (whether by merger of the Borrower or any of its Subsidiaries (including Subsidiaries created pursuant to Section 9.15), or a Stock Swap or a Station Swap effected pursuant to Section 9.02(ix)) of a Person whose only business is the ownership of radio stations (and related assets) or equipment to be used at the Stations (each a "Reinvestment Asset" and together the "Reinvestment Assets") within 180 days following such date, and, if such proceeds are received after the repayment of all obligations under the Bridge Financing, the entire amount of such Net Sale Proceeds shall be deposited with the Managing Agent pursuant to a cash collateral arrangement reasonably satisfactory to the Managing Agent whereby such proceeds shall be disbursed to the Borrower to pay actual costs incurred by it in connection with the acquisition of Reinvestment Assets or the making of any escrow deposits in connection therewith, provided further, that at any time an Event of Default has occurred and is continuing the Required Banks may direct the Managing Agent (in which case the Managing Agent shall, and is hereby authorized by the Borrower to follow said directions) to apply any and all proceeds then on deposit in such collateral account to the repayment of Obligations in the same manner as proceeds would be applied pursuant to the Amended and Restated Borrower Security Agreement and, provided farther, that if all or any portion of such Net Sale Proceeds not applied as a mandatory repayment and/or commitment reduction pursuant to the preceding proviso are either (a) not so used or committed to be used within 180 days after the date of receipt of such Net Sale Proceeds or (b) if committed to be so used within 180 days after the date of receipt of such Net Sale Proceeds and not so used within 360 days after the date of receipt of such Net Sale Proceeds, then, in either such case, such remaining portion not used or committed to be used in the case of preceding clause (a) and not used in the-case of preceding clause (b) shall be applied on the date which is 180 days following the date of receipt of such Net Sale Proceeds in the case of clause (a) above, or the date occurring 360 days after the date of receipt of such Net Sale Proceeds in the case of clause (b) above as a mandatory repayment and/or commitment reduction in accordance with the requirements of Sections 4.02(h) and (i). At the time of the acquisition of any Reinvestment Assets, Holdings shall comply and shall cause its Subsidiaries to comply with Section 8.12. -28- 36 (f) In addition to any other mandatory repayments pursuant to this Section 4.02, on each Excess Cash Payment Date, an amount equal to 50% of the Excess Cash Flow for the relevant Excess Cash Payment Period shall be applied as a mandatory repayment of principal of outstanding Term Loans in accordance with the requirements of Sections 4.02(h) and (i). (g) In addition to any other mandatory repayments or commitment reductions pursuant to this Section 4.02, within 10 days following each date after the Second Restatement Effective Date on which Holdings or any of its Subsidiaries receives any proceeds from any Recovery Event, an amount equal to 100% of the proceeds of such Recovery Event (net of reasonable costs including, without limitation, legal costs and expenses and taxes incurred in connection with such Recovery Event) shall be applied as a mandatory repayment and/or commitment reduction in accordance with the requirements of Sections 4.02(h) and (i), provided that (x) so long as no Default or Event of Default then exists and such proceeds do not exceed $2,500,000, such proceeds shall not be required to be so applied on such date to the extent that the Borrower has delivered a certificate to the Managing Agent on or prior to such date stating that such proceeds shall be used to replace or restore any properties or assets in respect of which such proceeds were paid within 180 days following the date of such Recovery Event (which certificate shall set forth the estimates of the proceeds to be so expended) and (y) so long as no Default or Event of Default then exists and to the extent that (a) the amount of such proceeds exceeds $2,500,000, (b) the Borrower has delivered to the Managing Agent a certificate on or prior to the date the application would otherwise be required pursuant to this Section 4.02(g) in the form described in clause (x) above and also certifying the sufficiency of business interruption insurance as required by succeeding clause (c), and (c) the Borrower has delivered to the Managing Agent such evidence as the Managing Agent may reasonably request in form and substance satisfactory to the Managing Agent establishing that the Borrower has sufficient business interruption insurance and that the Borrower will be receiving regular payments thereunder in such amounts and at such times as are necessary to satisfy all obligations and expenses of the Borrower (including, without limitation, all debt service requirements, including pursuant to this Agreement), without any delay or extension thereof, for the period from the date of the respective casualty, condemnation or other event giving rise to the Recovery Event and continuing through the completion of the replacement or restoration of respective properties or assets, then the entire amount and not just the portion in excess of $2,500,000 shall be deposited with the Managing Agent pursuant to a cash collateral arrangement reasonably satisfactory to the Managing Agent whereby such proceeds shall be disbursed to the Borrower from time to time as needed to pay actual costs incurred by it in connection with the replacement or restoration of the respective properties or assets (pursuant to such certification requirements as may be established by the Managing Agent), provided further, that at any time while an Event of Default has occurred and is continuing (other than an Event -29- 37 of Default existing solely as a result of the violation of any or all of Sections 9.08, 9.09 and 9.10, but in each case only if, and to the extent, that the violation of said covenant has occurred as a result of the underlying event giving rise to the Recovery Event), the Required Banks may direct the Managing Agent (in which case the Managing Agent shall, and is hereby authorized by the Borrower to, follow said directions) to apply any or all proceeds then on deposit in such collateral account to the repayment of Obligations hereunder in the same manner as proceeds would be applied pursuant to the Amended and Restated Borrower Security Agreement, and, provided further, that if all or any portion of such proceeds not required to be applied as a mandatory repayment and/or commitment reduction pursuant to the second preceding proviso (whether pursuant to clause (x) or (y) thereof) are either (A) not so used within 180 days after the date of receipt of proceeds from the respective Recovery Event or (B) if committed to be used within 180 days after the date of receipt of proceeds from the respective Recovery Event and not so used within 360 days after the date of receipt of proceeds from the respective Recovery Event, then, in either case, such remaining portion not used or committed to be used in the case of the preceding clause (A) and not used in the case of preceding clause (B), shall be applied on the date which is 180 days following the date of receipt of proceeds from the respective Recovery Event in the case of clause (A) above, or the date which is 360 days after the date of receipt of proceeds from the respective Recovery Event in the case of clause (B) above as a mandatory repayment and/or commitment reduction in accordance with the requirements of Section 4.02(h) and (i). (h) Each amount required to be applied to repay Term Loans (i) pursuant to Section 4.02(f) and (g) shall be applied to reduce the then remaining Scheduled Repayments pro rata based upon the then remaining number of Scheduled Repayments after giving effect to all prior reductions thereto (ie., each then remaining Scheduled Repayment shall be reduced by an amount equal to the aggregate amount to be applied to the Term Loans divided by the then remaining Scheduled Repayments); provided that if the amount to be applied to any Scheduled Repayment would exceed the then remaining amount of such Scheduled Repayment, then an amount equal to such excess shall be applied to reduce the other then remaining Scheduled Repayments, after giving effect to all prior reductions thereto (including the amount of prepayments theretofore allocated pursuant to the preceding portion of this sentence), pro rata based upon the then remaining number of Scheduled Repayments in the manner described above and (ii) pursuant to Sections 4.02(c) through (e) shall be applied to reduce the then remaining Scheduled Repayments in inverse order of maturity based upon the then remaining number of Scheduled Repayments after giving effect to all prior reductions thereto. (i) With respect to each repayment of Loans required by this Section 4.02, the Borrower may designate the Types of Loans of the respective Tranche which -30- 38 are to be repaid and, in the case of Eurodollar Loans, the specific Borrowing or Borrowings of the respective Tranche pursuant to which made, provided that: (i) repayments of Eurodollar Loans pursuant to this Section 4.02 may only be made on the last day of an Interest Period applicable thereto unless all Eurodollar Loans of the respective Tranche with Interest Periods ending on such date of required repayment and all Base Rate Loans of the respective Tranche have been paid in full; (ii) if any repayment of Eurodollar Loans made pursuant to a single Borrowing shall reduce the outstanding Eurodollar Loans made pursuant to such Borrowing to an amount less than (x) in the case of Term Loans, $2,000,000, and (y) in the case of Revolving Loans, $1,000,000, such Borrowing shall be converted at the end of the then current Interest Period into a Borrowing of Base Rate Loans; and (iii) each repayment of any Loans made pursuant to a Borrowing shall be applied pro rata among the Banks which made such Loans. In the absence of a designation by the Borrower as described in the preceding sentence, the Managing Agent shall, subject to the above, make such designation in its sole discretion with a view, but no obligation, to minimize breakage costs owing under Section 1.11. Notwithstanding the foregoing provisions of this Section 4.02, if at any time the mandatory prepayment of Term Loans pursuant to Sections 4.02(c) through (g) or Revolving Loans pursuant to Section 4.02(a)(iii) above would result, after giving effect to the procedures set forth above, in the Borrower incurring breakage costs under Section 1.11 as a result of Eurodollar Loans being prepaid other than on the last day of an Interest Period applicable thereto (the "Affected Eurodollar Loans"), then the Borrower may in its sole discretion initially deposit a portion (up to 100%) of the amounts that otherwise would have been paid in respect of the Affected Eurodollar Loans with the Managing Agent (which deposit must be equal in amount to the amount of Affected Eurodollar Loans not immediately prepaid) to be held as security for the obligations of the Borrower hereunder pursuant to a cash collateral agreement to be entered into in form and substance reasonably satisfactory to the Managing Agent, with such cash collateral to be directly applied upon the first occurrence (or occurrences) thereafter of the last day of an Interest Period applicable to the relevant Loans that are Eurodollar Loans (or such earlier date or dates as shall be requested by the Borrower), to repay an aggregate principal amount of such Loans equal to the Affected Eurodollar Loans not initially repaid pursuant to this sentence, provided that in the case of repayments of Revolving Loans pursuant to Section 4.02(a)(iii) the Borrower may by notice to the Managing Agent elect to temporarily reduce the availability by the amount of such required repayment (such temporary reduction not to effect any calculation of the Commitment Commission) in lieu of providing cash collateral as provided in this sentence, which reduction shall continue in effect until such time as the occurrence thereafter of the last day of an Interest Period or Interest Periods applicable to such Revolving Loans that are Eurodollar Loans and the repayment of such amounts by the Borrower. Notwithstanding anything to the contrary contained in the immediately preceding sentence, all amounts deposited as cash collateral pursuant to the immediately preceding sentence shall be held for the sole benefit of the Banks whose Loans would -31- 39 otherwise have been immediately repaid with the amounts deposited and upon the taking of any action by the Managing Agent or the Banks pursuant to the remedial provisions of Section 10, any amounts held as cash collateral pursuant to this Section 4.02(i) shall, subject to the requirements of applicable law, be immediately applied to the relevant Loans. 4.03 Method and Place of Payment. Except as otherwise specifically provided herein, all payments under this Agreement or any Note shall be made to the Managing Agent for the account of the Bank or Banks entitled thereto not later than 12:00 Noon (New York time) on the date when due and shall be made in Dollars in immediately available funds at the Payment Office of the Managing Agent. Whenever any payment to be made hereunder or under any Note shall be stated to be due on a day which is not a Business Day, the due date thereof shall be extended to the next succeeding Business Day and, with respect to payments of principal, interest shall be payable at the applicable rate during such extension. 4.04 Net Payments. (a) All payments made by the Borrower hereunder or under any Note will be made without set-off, counterclaim or other defense. Except as provided in Section 4.04(b), all such payments will be made free and clear of, and without deduction or withholding for, any present or future taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed by any jurisdiction or by any political subdivision or taxing authority thereof or therein with respect to such payments (but excluding, except as provided in the second succeeding sentence, any tax imposed on or measured by the net income or net profits of a Bank, or any franchise tax based on the net income or net profits of a Bank, in either case pursuant to the laws of the United States of America or the jurisdiction in which it is organized or in which the principal office or applicable lending office of such Bank is located or any subdivision thereof or therein) and all interest, penalties or similar liabilities with respect thereto (all such non-excluded taxes, levies, imposts, duties, fees, assessments or other charges being referred to collectively as "Taxes"). If any Taxes are so levied or imposed, the Borrower agrees to pay the full amount of such Taxes, and such additional amounts as may be necessary so that every payment of all amounts due under this Agreement or under any Note, after withholding or deduction for or on account of any Taxes, will not be less than the amount provided for herein or in such Note. If any amounts are payable in respect of Taxes pursuant to the preceding sentence of this Section 4.04(a), then the Borrower agrees to reimburse each Bank, upon the written request of such Bank, for taxes imposed on or measured by the net income or net profits of such Bank, or any franchise tax based on the net income or net profits of such Bank, in either case pursuant to the laws of the jurisdiction in which such bank is organized or in which the principal office or applicable lending office of such Bank is located or under the laws of any political subdivision or taxing authority of any such jurisdiction in which the principal office or applicable lending -32- 40 office of such Bank is located and for any withholding of income or similar taxes imposed by the United States of America as such Bank shall determine in good faith are payable by, or withheld from, such Bank in respect of such amounts so paid to or on behalf of such Bank pursuant to the preceding sentence and in respect of any amounts paid to or on behalf of such Bank pursuant to this sentence. The Borrower will furnish to the Managing Agent within 45 days after the date the payment of any Taxes is due pursuant to applicable law certified copies of tax receipts evidencing such payment by the Borrower. The Borrower agrees to indemnify and hold harmless each Bank, and reimburse such Bank upon its written request, for the amount of any Taxes described in the preceding sentences and subject to payment by Borrower which are so levied or imposed and paid by such Bank. (b) Each Bank that is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) agrees to deliver to the Borrower and the Managing Agent on or prior to the Second Restatement Effective Date, or in the case of a Bank that is an assignee or transferee of an interest under this Agreement pursuant to Sections 1.13 or 13.04 (unless the respective Bank was already a Bank hereunder immediately prior to such assignment or transfer), on the date of such assignment or transfer to such Bank, (i) two accurate and complete original signed copies of Internal Revenue Service Form 4224 or Form 1001 (or successor forms) certifying to such Bank's entitlement to a complete exemption from United States withholding tax with respect to payments to be made under this Agreement and under any Note, or (ii) if the Bank is not a "bank" within the meaning of Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue Service Form 1001 or Form 4224 pursuant to clause (i) above, (x) a certificate substantially in the form of Exhibit D (any such certificate, a "Section 4.04(b)(ii) Certificate") and (y) two accurate and complete original signed copies of Internal Revenue Service Form W-8 (or successor form) certifying to such Bank's entitlement to a complete exemption from United States withholding tax with respect to payments of interest to be made under this Agreement and under any Note. In addition, each Bank agrees that from time to time after the Second Restatement Effective Date, when a lapse in time or change in circumstances renders the previous certification obsolete or inaccurate in any material respect, it will deliver to the Borrower and the Managing Agent two new accurate and complete original signed copies of Internal Revenue Service Form 4224 or Form 1001, or Form W-8 and a Section 4.04(b)(ii) Certificate, as the case may be, and such other forms as may be required in order to confirm or establish the entitlement of such Bank to a continued exemption from or reduction in United States withholding tax with respect to payments under this Agreement and any Note, or it shall immediately notify the Borrower and the Managing Agent of its inability to deliver any such form or certificate, in which case such Bank shall not be required to deliver any such form or certificate pursuant to this Section 4.04(b). Notwithstanding anything to the contrary contained in Section 4.04(a), but subject to Section 13.04(b) and the immediately succeeding sentence, (x) the Borrower -33- 41 shall be entitled, to the extent it is required to do so by law, to deduct or withhold income or similar taxes imposed by the United States (or any political subdivision or taxing authority thereof or therein) from interest, fees or other amounts payable hereunder for the account of any Bank which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes to the extent that such Bank has not provided to the Borrower U.S. Internal Revenue Service forms that establish a complete exemption from such deduction or withholding and (y) the Borrower shall not be obligated pursuant to Section 4.04(a) hereof to gross-up payments to be made to a Bank in respect of income or similar taxes imposed by the United States if (I) such Bank has not provided to the Borrower the Internal Revenue Service forms required to be provided to the Borrower pursuant to this Section 4.04(b) or (II) in the case of a payment, other than interest, to a Bank described in clause (ii) above, to the extent that such forms do not establish a complete exemption from withholding of such taxes. Notwithstanding anything to the contrary contained in the preceding sentence or elsewhere in this Section 4.04 and except as set forth in Section 13.04(b), the Borrower agrees to pay additional amounts and to indemnify each Bank in the manner set forth in Section 4.04(a) (without regard to the identity of the jurisdiction requiring the deduction or withholding) in respect of any amounts deducted or withheld by it as described in the immediately preceding sentence as a result of any changes after the Second Restatement Effective Date in any applicable law, treaty, governmental rule, regulation, guideline or order, or in the interpretation thereof, relating to the deducting or withholding of income or similar Taxes. (c) Each Bank that is a United States person (as such term is defined in Section 7701(a)(30) of the Code) will provide an original signed copy of Internal Revenue Service Form W-9 (or successor form) to each of the Borrower and the Managing Agent upon the reasonable written request of the Borrower. (d) The provisions of this Section 4.04 are subject to the provisions of Section 13.15 (to the extent applicable). SECTION 5. Conditions Precedent to Credit Events on the Second Restatement Effective Date. The occurrence of the Second Restatement Effective Date pursuant to Section,13.10 and the obligation of each Bank to make or maintain Loans and to participate in Letters of Credit under this Agreement, and the obligations of each Issuing Bank to issue Letters of Credit, in each case on the Second Restatement Effective Date, is subject, at the time of such Credit Event, to the satisfaction of the following conditions: 5.01 Execution of Agreement; Notes. On or prior to the Second Restatement Effective Date (i) this Agreement shall have been executed and delivered as provided in Section 13.10 and (ii) there shall have been delivered to the Managing -34- 42 Agent for the account of each of the Banks that has requested a Note the appropriate Term Note and/or Revolving Note executed by the Borrower, in each case in the amount, maturity and as otherwise provided herein. 5.02 Fees, etc. On the Second Restatement Effective Date, the Borrower shall have paid to the Managing Agent and the Banks all costs, fees and expenses (including, without limitation, reasonable legal fees and expenses) payable to the Managing Agent and the Banks to the extent then due. 5.03 Opinions of Counsel. On the Second Restatement Effective Date, the Managing Agent shall have received (i) from Weil, Gotshal & Manges LLP, special counsel to Holdings and its Subsidiaries, an opinion addressed to the Managing Agent and each of the Banks and dated the Second Restatement Effective Date covering the matters set forth in Exhibit E-1 and (ii) from Liebowitz & Associates, FCC counsel to Holdings and its Subsidiaries, an opinion addressed to the Managing Agent and each of the Banks and dated the Second Restatement Effective Date covering the matters set forth in Exhibit E-2. 5.04 Corporate Documents; Proceedings; etc. (a) On the Second Restatement Effective Date, the Managing Agent shall have received a certificate, dated the Second Restatement Effective Date, signed by an Authorized Officer of each Credit Party, and attested to by the Secretary or any Assistant Secretary of such Credit Party, each in the form of Exhibit F with appropriate insertions, together with copies of the Certificate of Incorporation, By-Laws and resolutions (or such other administrative approval) of such Credit Party referred to in such certificate, and the foregoing shall be reasonably acceptable to the Managing Agent. (b) On the Second Restatement Effective Date, all corporate and legal proceedings and all instruments and agreements in connection with the transactions contemplated by this Agreement and the other Documents shall be reasonably satisfactory in form and substance to the Managing Agent and the Required Banks, and the Managing Agent shall have received all information and copies of all documents and papers, including records of corporate proceedings, governmental approvals, good standing certificates and bring-down telegrams or facsimiles, if any, which the Managing Agent may have reasonably requested in connection therewith, such documents and papers to be certified where appropriate by proper corporate or governmental authorities. 5.05 Shareholders' Agreements; Management Agreements; Employment Agreements; Tax Sharing Agreements. On the Second Restatement Effective Date, there shall have been delivered to the Managing Agent true and correct copies, certified as true and complete by an Authorized Officer of Holdings or its respective Subsidiaries -35- 43 of (i) the Stockholders' Agreement and all other agreements entered into by Holdings or any of its Subsidiaries governing the terms and relative rights of its capital stock and any agreements entered into by shareholders, relating to any such entity with respect to its capital stock (collectively, the "Shareholders' Agreements"), (ii) all agreements with senior members of, or with respect to, the management of Holdings or any of its Subsidiaries (collectively, the "Management Agreements"), (iii) the Dinetz Employment Contract, (iv) all agreements relating to the sharing of tax liabilities and benefits among Holdings and/or its Subsidiaries (each a "Tax Sharing Agreement" and collectively, the "Tax Sharing Agreements") and (v) all Existing Debt Agreements; all of which Shareholders' Agreements, Management Agreements, Dinetz Employment Contract, Tax Sharing Agreements and Existing Debt Agreements shall be in form and substance reasonably satisfactory to the Managing Agent and the Required Banks and shall be in full force and effect on the Second Restatement Effective Date. 5.06 Absence of Certain Conditions. (a) The Managing Agent shall be satisfied that Holdings and each of its Subsidiaries (x) has complied in all material respects with each of the Shareholders' Agreements and all agreements (the "Existing Debt Agreements") governing Indebtedness permitted to remain outstanding on and after the Second Restatement Effective Date pursuant to Section 9.04 (the "Existing Debt") and (y) shall be able to perform all of their respective obligations under this Agreement and the Bridge Financing Documents. (b) Neither any Existing Debt nor, except as specifically permitted herein, the Bridge Financing, shall be subject to, or as a result of the consummation of the Transaction become subject to, any mandatory repayment obligation of Holdings or any of its Subsidiaries prior to the stated maturity thereof. 5.07 Consummation of the Bridge Financing; Transaction. (a) On or prior to the Second Restatement Effective Date: (i)(x) Holdings shall have consummated the Bridge Financing pursuant to the terms and conditions of the Bridge Financing Documents, (y) Holdings shall have contributed the entire net proceeds thereof as a capital contribution to the Borrower and (z) the Borrower shall have applied all remaining proceeds of the Bridge Financing to make payments owing in connection with the Transaction before using the proceeds of any Loans for such purpose; (ii) the Borrower shall successfully have consummated the Tender Offer pursuant to the terms and conditions of the Tender Offer Documents; (iii) the Supplemental Indenture shall be in full force and effect; -36- 44 (iv) the Borrower shall have acquired (the "Viacom Acquisition") all of the stock of the Acquired Viacom Subsidiaries pursuant to the terms and conditions set forth in the Viacom Joint Purchase Agreement and the other Viacom Acquisition Documents and in accordance with all applicable laws relating thereto; and (v) immediately prior to or after giving effect to the Viacom Acquisition, the License Subsidiary shall hold all the FCC Licenses in accordance with any rules of, or consents required by the FCC and on terms and conditions reasonably satisfactory to the Managing Agent and the Required Banks. (b) On or prior to the Second Restatement Effective Date, there shall have been delivered to the Agents copies of all the Transaction Documents and Bridge Financing Documents, all of which shall be certified by an Authorized Officer of Holdings and/or its Subsidiaries as true and correct and be in full force and effect. On the Second Restatement Effective Date, the Transaction and the Bridge Financing shall have been consummated in accordance with the Transaction Documents and the Bridge Financing Documents, respectively, which Transaction Documents and Bridge Financing Documents shall be reasonably satisfactory to the Agents and the Required Banks, and all applicable laws relating thereto. All conditions in the Transaction Documents and Bridge Financing Documents shall have been satisfied, without amendment, waiver or modification (except with the consent of the Agents and the Required Banks, which consent shall not be unreasonably withheld), and all covenants in the Viacom Acquisition Documents shall have been performed in all material respects, without amendment, waiver or modification (except with the consent of the Agents and the Required Banks, which consent shall not be unreasonably withheld), and all representations and warranties contained therein shall be true and correct in all material respects, without amendment, waiver or modification (except with the consent of the Agents and the Required Banks, which consent shall not be unreasonably withheld), and all terms and conditions of, and documentation for, the Viacom Acquisition, the Tender Offer (including, without limitation, the Supplemental Indenture) and the Bridge Financing, including, without limitation, amortization, maturities, interest rates, covenants, defaults, remedies, subordination provisions and all other terms, shall be reasonably acceptable to the Agents and the Required Banks. (c) On or prior to the Second Restatement Effective Date, all necessary and material governmental (domestic and foreign) and third party approvals in connection with the Transaction (including, without limitation, preliminary approval from the FCC (the "FCC Consents") of the transfer of control of the Viacom FCC Licenses contemplated by the Transaction) and the transactions contemplated by the Credit Documents and otherwise referred to herein or therein, shall have been obtained -37- 45 and remain in effect, and all applicable waiting periods (excluding appeal periods with respect to the FCC Consents) shall have expired without any action being taken by any competent authority which restrains, prevents or imposes, in the judgment of the Managing Agent, materially adverse conditions upon the consummation of the Transaction and the transactions contemplated by this Agreement, provided that, without limiting the foregoing, (i) no petition for reconsideration or request for review, rescission or stay or other objection to the grant of the FCC Consents shall be pending and unresolved before the FCC or any court; (ii) the FCC Consents shall not be subject to, or impose upon Holdings, the Borrower or any of their respective Subsidiaries or any of the Stations (including, but not limited to, Stations to be acquired in the Viacom Acquisition), any conditions or require the performance of any obligations that, in the judgment of the Managing Agent, could have a material and adverse effect upon the value of the Stations or the ability of the Borrower to perform its obligations under the Transaction, any of the Credit Documents or the transactions contemplated by the Credit Agreement; (iii) to the extent that (A) a basis for the grant by the FCC of the FCC Consents is a settlement agreement or similar agreement or (B) Holdings, the Borrower or any of their respective Subsidiaries is a party to a settlement agreement entered into in connection with the grant of the FCC Consents or (C) the grant of the FCC Consents is by written order of the FCC, then the Managing Agent shall have been furnished a complete copy of such settlement agreement or written order, together with a copy of any related filings with the FCC, and neither the terms of such settlement agreement nor the terms of such written order, in the judgment of the Managing Agent, could have a material and adverse effect upon the value of the Stations or the ability of the Borrower to perform its obligations under the Transaction, any of the Credit Documents or the transactions contemplated by the Credit Agreement, and Holdings, the Borrower and their respective Subsidiaries shall be in compliance with such written order or settlement agreement. Additionally, except as fully disclosed on Annex 5.07, there shall not exist any judgment, order, injunction or other restraint issued or filed or a hearing seeking injunctive relief or other restraint pending or notified prohibiting or imposing materially adverse conditions upon the consummation of the Transaction or the transactions contemplated by this Agreement. -38- 46 5.08 Subsidiary Guaranty. On the Second Restatement Effective Date, each of the Acquired Viacom Subsidiaries shall have duly authorized, executed and delivered a Subsidiary Guaranty in the form of Exhibit G hereto (as amended, modified, extended, renewed, replaced, restated or supplemented from time to time, the "Subsidiary Guaranty"). 5.09 Pledge Agreement. (a) On the Second Restatement Effective Date, each of the Acquired Viacom Subsidiaries shall have duly authorized, executed and delivered a Subsidiary Pledge Agreement in the form of Exhibit H (as amended, modified, extended, renewed, replaced, restated or supplemented from time to time, the "Subsidiary Pledge Agreement") and shall have delivered to the Collateral Agent, as Pledgee, all the Pledged Securities referred to therein then owned by such Subsidiary, together with executed and undated stock powers, in the case of capital stock constituting Pledged Securities. 5.10 Subsidiary Security Agreement. On the Second Restatement Effective Date, (i) each of the Acquired Viacom Subsidiaries shall have duly authorized, executed and delivered a Security Agreement in the form of Exhibit I (as amended, modified, extended, renewed, replaced, restated or supplemented from time to time, the "Subsidiary Security Agreement") covering all of such Subsidiaries' present and future Security Agreement Collateral, (ii) no filings, recordings, registrations or other actions shall be necessary or desirable to maintain the perfection and priority of the security interests granted by the original parties to the Amended and Restated Security Agreements in the Security Agreement Collateral covered thereby (except to the extent made pursuant to clauses (c) or (d) below), and (iii) in the case of the Subsidiary Security Agreement, the Managing Agent shall have received: (a) executed copies of Financing Statements (Form UCC-1) in appropriate form for filing under the UCC of each jurisdiction as may be necessary in the reasonable discretion of the Collateral Agent to perfect the security interests purported to be created by the Subsidiary Security Agreement; (b) certified copies of Requests for Information or Copies (Form UCC-11), or equivalent reports, listing all effective financing statements that name Viacom or any Subsidiary of Viacom as debtor and that are filed in any jurisdiction where a filing may be necessary or, in the opinion of the Collateral Agent, desirable to perfect the security interest purported to be created by such Subsidiary Security Agreement, together with copies of such financing statements (none of which shall cover the Collateral except to the extent evidencing Permitted Liens or in respect of which the Collateral Agent shall have received termination statements (Form UCC-3) or such other termination statements as shall be required by local law); -39- 47 (c) evidence of the completion of all other recordings and filings of, or with respect to, the Subsidiary Security Agreement as may be necessary or, in the reasonable opinion of the Collateral Agent, desirable to perfect the security interests intended to be created by such Subsidiary Security Agreement; and (d) evidence that all other actions necessary or, in the reasonable opinion of the Collateral Agent, desirable to perfect and protect the security interests purported to be created by the Subsidiary Security Agreement have been taken. 5.11 Existing Mortgages, Title Insurance, etc. On the Second Restatement Effective Date, the Collateral Agent shall have received: (a) duly authorized, fully executed, acknowledged, and delivered deeds of trust, mortgages, leasehold deeds of trust or leasehold mortgages substantially in the form of Exhibit J (as amended, modified, extended, renewed, replaced, restated or supplemented from time to time, each a "Mortgage" and, collectively, the "Mortgages"), which Mortgages shall cover such of the Real Property owned or leased by Holdings and/or its Subsidiaries and listed on Part A of Schedule III as a Mortgaged Property (each, a "Mortgaged Property" and, collectively, the "Mortgaged Properties"); provided that with respect to those Mortgaged Properties covered by an Existing Mortgage and designated as Existing Mortgaged Properties on Part A of Schedule III, the Collateral Agent shall have received, in lieu of a Mortgage, a fully executed counterpart of an amendment (the "Mortgage Amendment"), in form and substance satisfactory to the Managing Agent, to such Existing Mortgage, together with evidence that counterparts of such Mortgages and Mortgage Amendments have been delivered to the title insurance company insuring the Lien on the Mortgages and Existing Mortgages for recording in all places to the extent necessary, or, in the reasonable opinion of the Collateral Agent, desirable to effectively create or maintain a valid and enforceable first priority mortgage lien on the Mortgaged Properties in favor of the Collateral Agent (or such other trustee as may be required or desired under local law) for the benefit of the Secured Creditors; (b) duly authorized, fully executed, acknowledged, and delivered subordination, nondisturbance and attornment agreements, assignments of leases, landlord consents, tenant estoppel certificates, and such other documents relating to the Mortgages that the Collateral Agent may reasonably request; (c) ALTA Lender's extended coverage policies of mortgage title insurance (or the equivalent in the state where the respective Mortgaged Property is located) covering each Mortgaged Property, together with all -40- 48 endorsements reasonably requested by the Collateral Agent relating thereto issued by Commonwealth Land Title Company or such other title insurers reasonably satisfactory to the Collateral Agent (the "Mortgage Policies") in amounts reasonably satisfactory to the Managing Agent (but not in excess of the value of the respective Mortgaged Property) assuring the Collateral Agent that the Mortgages on such Mortgaged Properties are valid and enforceable first priority mortgage liens on the respective Mortgaged Properties, free and clear of all defects and encumbrances except Permitted Encumbrances and such Mortgage Policies shall otherwise be in form and substance reasonably satisfactory to the Managing Agent and the Required Banks and shall include, as appropriate, an endorsement for future advances under this Agreement, the Notes and for any other matter that the Collateral Agent in its reasonable discretion may reasonably request, and such Mortgage Policies shall not include an exception for mechanics' liens, and shall provide for affirmative insurance and such reinsurance as the Collateral Agent in its discretion may reasonably request; and (d) endorsements of the authorized issuing agent for the title insurer, which agent shall be reasonably satisfactory to the Collateral Agent, to each Existing Mortgage Policy assuring the Collateral Agent that the Existing Mortgages are valid and enforceable first priority mortgage liens on the respective Existing Mortgaged Properties, free and clear of all defects and encumbrances other than Permitted Encumbrances. 5.12 Environmental Indemnity Agreement. On the Second Restatement Effective Date, the Collateral Agent shall have received a duly authorized and fully executed Environmental Indemnity Agreement substantially in the form of Exhibit K (as amended, modified, extended, renewed, replaced, restated or supplemented from time to time, the "Environmental Indemnity Agreement") from the Acquired Viacom Subsidiaries. 5.13 Existing Credit Agreement; etc. On the Second Restatement Effective Date, (i) each Existing Bank shall have surrendered to the Managing Agent for cancellation the promissory notes issued to it pursuant to the Existing Credit Agreement in respect of its Existing Loans, (ii) each Continuing Bank shall have converted its Existing Term Loan and Existing Revolving Loan as contemplated by Sections 1.01(a) and (b), respectively, (iii) each Existing Bank which is not a Continuing Bank shall have received payment in full of all amounts then due and owing to it under the Existing Credit Agreement, (iv) each Continuing Bank whose Existing Loans outstanding on the Second Restatement Effective Date exceed the aggregate principal amount of Loans to be made available by such Continuing Bank on such date shall have received payment in full of all amounts then due and owing to it as provided -41- 49 in Section 13.18(c), (v) the Borrower shall have paid all interest and fees (including commitment fees) owing under the Existing Credit Agreement through the Second Restatement Effective Date, and (vi) the Managing Agent shall have received evidence in form, scope and substance satisfactory to it that the matters set forth in this Section 5.13 have been satisfied on such date. 5.14 Adverse Change, etc. On the Second Restatement Effective Date, after giving effect to the Transaction, nothing shall have occurred since December 31, 1996 which could reasonably be likely to have a material adverse effect on the rights or remedies of the Banks, or on the ability of the Credit Parties to perform their respective obligations to the Managing Agent and the Banks or which could reasonably be likely to have a material adverse effect on the operations, property, assets, liabilities or condition (financial or otherwise) of Holdings and its Subsidiaries taken as a whole. 5.15 Solvency Certificate; Environmental Analyses; Insurance. On or before the Second Restatement Effective Date, the Borrower shall have delivered or shall cause to be delivered to the Banks (i) a solvency certificate in form and substance satisfactory to the Agents from the Chief Financial Officer of Holdings and the Borrower, setting forth the conclusion that, after giving effect to the Transaction, each of Holdings and its Subsidiaries taken as a whole, and the Borrower and its Subsidiaries, taken as a whole, is not insolvent and will not be rendered insolvent by the indebtedness incurred in connection therewith, and will not be left with unreasonably small capital with which to engage in their business and will not have incurred debts beyond their ability to pay debts as they mature, (ii) the Phase I environmental assessments from Dames & Moore, with respect to certain of the Real Property acquired pursuant to the Transaction and (iii) evidence of insurance complying with the requirements of Section 8.03 for the business and properties of Holdings and its Subsidiaries, in scope, form and substance reasonably satisfactory to the Managing Agent and the Required Banks and naming the Collateral Agent as an additional insured and/or loss payee, and stating that such insurance shall not be cancelled or revised without 30 days' prior written notice by the insurer to the Collateral Agent. 5.16 Pro Forma Balance Sheet, Projections. (a) On the Second Restatement Effective Date, the Banks shall have received the unaudited projected pro forma consolidated balance sheets of Holdings and the Borrower prepared on a consolidated basis based upon the projected balance sheet at the Second Restatement Effective Date prepared on a basis consistent with the Projections and in accordance with the financial statements delivered pursuant to Section 7.05(a), both immediately before and immediately after giving effect to the Transaction, the related financing thereof (including, without limitation, the Bridge Financing) and the other transactions contemplated hereby and thereby, which projected pro forma consolidated balance -42- 50 sheets shall be in form and substance reasonably satisfactory to the Managing Agent and the Required Banks. (b) On the Second Restatement Effective Date, the Banks shall have received the Projections described in Section 7.05(d), which Projections shall be in form and substance reasonably satisfactory to the Managing Agent and the Required Banks. 5.17 Acknowledgment, Consent and Amendment. (a) On the Second Restatement Effective Date, each of the Existing Chancellor Entities shall have duly authorized, executed and delivered an Acknowledgment, Consent and Amendment in the form of Exhibit M hereto (as amended, modified, extended, renewed, replaced, restated or supplemented from time to time, the "Acknowledgment, Consent and Amendment"). (b) On the Second Restatement Effective Date, the Collateral Agent, as Pledgee, shall have in its possession all the Pledged Securities referred to in the Amended and Restated Holdings Pledge Agreement, the Amended and Restated Borrower Pledge Agreement and the Amended and Restated Subsidiary Pledge Agreement then owned by the Existing Chancellor Entities, including, without limitation, the capital stock of the Acquired Viacom Subsidiaries, together with executed and undated stock powers, in the case of capital stock constituting Pledged Securities. (c) On the Second Restatement Effective Date, (i) the Amended and Restated Holdings Security Agreement, the Amended and Restated Borrower Security Agreement and the Amended and Restated Subsidiary Security Agreement shall remain in full force and effect with respect to the Existing Chancellor Entities, (ii) no filings, recordings, registrations or other actions shall be necessary or desirable to maintain the perfection and priority of the security interests granted pursuant to the Amended and Restated Holdings Security Agreement, the Amended and Restated Borrower Security Agreement and the Amended and Restated Subsidiary Security Agreement in the Security Agreement Collateral covered thereby, and (iii) the Banks shall have received: (x) evidence of the completion of all recordings and filings of, or with respect to, the Amended and Restated Holdings Security Agreement, the Amended and Restated Borrower Security Agreement and the Amended and Restated Subsidiary Security Agreements as may be necessary or, in the opinion of the Collateral Agent, desirable to perfect the security interests intended to be created thereby; and -43- 51 (y) evidence that all other actions necessary or, in the opinion of the Collateral Agent, desirable to perfect and protect the security interests purported to be created by the Amended and Restated Holdings Security Agreement, the Amended and Restated Borrower Security Agreement and the Amended and Restated Subsidiary Security Agreement have been taken. SECTION 6. Conditions Precedent to All Credit Events. The obligation of each Bank to make Loans and participate in Letters of Credit (including Loans made and Letters of Credit issued on the Second Restatement Effective Date), and the obligation of any Issuing Bank to issue any Letter of Credit (including any Letter of Credit issued on the Second Restatement Effective Date), is subject, at the time of each such Credit Event (except as hereinafter indicated), to the satisfaction of the following conditions: 6.01 No Default; Representations and Warranties. At the time of each Credit Event and also after giving effect thereto (i) there shall exist no Default or Event of Default and (ii) all representations and warranties contained herein or in any other Credit Document shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on the date of the making of such Credit Event (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date). 6.02 Notice of Borrowing: Letter of Credit Request. (a) Prior to the making of each Loan, the Managing Agent shall have received the notice required by Section 1.03. (b) Prior to the issuance of each Letter of Credit, the Managing Agent and the respective Issuing Bank shall have received a Letter of Credit Request meeting the requirements of Section 2.02. The acceptance of the benefit of each Credit Event shall constitute a representation and warranty by Holdings and the Borrower to the Managing Agent and each of the Banks that all the conditions specified in Section 5 and in this Section 6 and applicable to such Credit Event exist as of that time (except to the extent that any of the conditions specified in Section 5 are required to be satisfactory to or determined by any Bank, the Required Banks and/or the Managing Agent). All of the Notes, certificates, legal opinions and other documents and papers referred to in Section 5 and in this Section 6, unless otherwise specified, shall be delivered to the Managing Agent at the Notice Office for the account of each of the Banks and, except for the Notes, in suffici- -44- 52 ent counterparts or copies for each of the Banks and shall be in form and substance reasonably satisfactory to the Banks. Notwithstanding anything to the contrary contained above or in Section 13. 10, if the Second Restatement Effective Date does not occur on or prior to June 30, 1997, then it shall not thereafter occur (unless the Required Banks agree in writing to an extension of such date), and this Agreement shall cease to be of any force or effect and the Existing Credit Agreement shall continue to be effective, as the same may have been, or may thereafter be, amended, modified or supplemented from time to time. SECTION 7. Representations, Warranties and Agreements. In order to induce the Banks to enter into this Agreement and to make the Loans, and issue (or participate in) the Letters of Credit as provided herein, each of Holdings and the Borrower makes the following representations, warranties and agreements, in each case after giving effect to the Transaction, all of which shall survive the execution and delivery of this Agreement and the Notes and the making of the Loans and the issuance of the Letters of Credit, with the occurrence of each Credit Event on or after the Second Restatement Effective Date being deemed to constitute a representation and warranty that the matters specified in this Section 7 are true and correct on and as of the Second Restatement Effective Date and in all material respects on the date of each such Credit Event (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date). 7.01 Corporate Status. Holdings, the Borrower and each of their respective Subsidiaries (i) is a duly organized and validly existing corporation in good standing under the laws of the jurisdiction of its organization, (ii) has the corporate power and authority to own its property and assets and to transact the business in which it is engaged and presently proposes to engage and (iii) is duly qualified to do business and is in good standing in each jurisdiction where the conduct of its business requires such qualifications except for failures to be so qualified which, individually or in the aggregate, could not reasonably be expected to have a material adverse effect on the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as a whole. 7.02 Corporate Power and Authority. Each Credit Party has the corporate power and authority to execute, deliver and perform the terms and provisions of each of the Documents to which it is party and has taken all necessary corporate action to authorize the execution, delivery and performance by it of each of such Documents. Each Credit Party has duly executed and delivered each of the Documents to which it is party, and each of such Documents constitutes such Credit Party's legal, valid and binding obligation enforceable in accordance with its terms, except to the -45- 53 extent that the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws generally affecting creditors' rights and by equitable principles (regardless of whether enforcement is sought in equity or at law). 7.03 No Violation. Neither the execution, delivery or performance by any Credit Party of the Documents to which it is a party, nor compliance by it with the terms and provisions thereof, (i) will contravene any provision of any applicable law, statute, rule or regulation or any applicable order, writ, injunction or decree of any court or governmental instrumentality, (ii) will conflict with or result in any breach of any of the terms, covenants, conditions or provisions of, or constitute a default under, or result in the creation or imposition of (or the obligation to create or impose) any Lien (except pursuant to the Security Documents) upon any of the material properties or assets of Holdings, the Borrower or any of their respective Subsidiaries pursuant to the terms of any indenture, mortgage, deed of trust, credit agreement or loan agreement, or any other material agreement, contract or instrument, to which Holdings, the Borrower or any of their respective Subsidiaries is a party or by which it or any of its property or assets is bound or to which it may be subject or (iii) will violate any provision of the Certificate of Incorporation or By-Laws of Holdings, or any of its Subsidiaries. 7.04 Governmental Approvals. No order, consent, approval, license, authorization or validation of, or filing, recording or registration with (except as have been obtained or made prior to the Second Restatement Effective Date), or exemption by, any governmental or public body or authority, or any subdivision thereof, is required to authorize, or is required in connection with, (i) the execution, delivery and performance of any Document or (ii) the legality, validity, binding effect or enforceability of any such Document, except, in the case of any failure to obtain where such failure to so obtain would not have a material adverse effect on (x) the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or Holdings and its Subsidiaries taken as a whole or (y) the ability of the Credit Parties to perform their obligations under the Credit Documents or the rights and remedies of the Managing Agent and the Banks thereunder; provided, however, that: (a) subsequent to the date of execution of the Credit Documents, copies of certain of the Credit Documents are required to be filed with the FCC; (b) the License Subsidiary will be required from time to time to obtain certain authorizations of, or to make certain filings with, the FCC that are required in connection with the ordinary course of business of the License Subsidiary and the Borrower; (c) subsequent to the Second Restatement Effective Date, under the Communications Act and the FCC rules, further FCC approval will be required prior to (A) the transfer of control of the License Subsidiary, the Borrower or Holdings or (B) the assignment of any of the FCC Licenses or prior to the exercise of any voting rights or management authority over the License -46- 54 Subsidiary, the Borrower or Holdings; and (d) prior to the exercise of certain rights or remedies under the Security Documents by the Managing Agent or the Banks, or their respective successors and assigns, FCC consents and notifications with respect to such exercise may be required to be timely obtained or made. 7.05 Financial Statements; Financial Condition; Undisclosed Liabilities, Projections; etc. (a) The balance sheets, statements of operations, statements of stockholders' equity, statements of changes in stockholders' equity, statements of changes in group deficiency, statements of operations and division equity, statements of assets and liabilities, statements of operating revenues and expenses, statements of changes in net assets, statements of changes in group investment (deficiency) and statements of cash flows of Holdings and its Subsidiaries previously delivered to the Managing Agent and the Banks fairly present the financial condition and operations of the Stations at and for the periods indicated. All such financial statements are true and correct in all material respects and have been prepared in accordance with GAAP, consistently applied. After giving effect to the Transaction, since December 31, 1996, there has been no material adverse change in the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as a whole. (b) On and as of the Second Restatement Effective Date, after giving effect to the Transaction and to all Indebtedness incurred, and to be incurred, and Liens created, and to be created, by Holdings and its Subsidiaries in connection therewith, (a) the sum of the assets, at a fair valuation, of each of Holdings and its Subsidiaries, and the Borrower and its Subsidiaries, will exceed their debts; (b) each of Holdings and its Subsidiaries, and the Borrower and its Subsidiaries, has not incurred and does not intend to incur, and does not believe that they will incur, debts beyond their ability to pay such debts as such debts mature; and (c) each of Holdings and its Subsidiaries, and the Borrower and its Subsidiaries, will have sufficient capital with which to conduct their businesses. For purposes of this Section 7.05(b), "debt" means any liability on a claim, and "claim" means (i) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured or (ii) right to an equitable remedy for breach of performance if such breach gives rise to a payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured or unsecured. (c) Except as fully disclosed in the financial statements delivered pursuant to Section 7.05(a), there were as of the Second Restatement Effective Date no liabilities or obligations with respect to Holdings or any of its Subsidiaries of any nature whatsoever (whether absolute, accrued, contingent or otherwise and whether or not due) which, either individually or in aggregate, would be material to the Borrower or to -47- 55 Holdings and its Subsidiaries taken as a whole. As of the Second Restatement Effective Date, neither Holdings nor the Borrower knows of any basis for the assertion against it of any liability or obligation of any nature whatsoever that is not fully disclosed in the financial statements delivered pursuant to Section 7.05(a) which, either individually or in the aggregate, could be material to Holdings and its Subsidiaries or the Borrower. (d) On and as of the Second Restatement Effective Date, the financial projections contained in the Confidential Memorandum dated as of May, 1997 (the "Projections") previously delivered to the Managing Agent and the Banks have been prepared on a basis consistent with the financial statements dated December 31, 1996 delivered pursuant to Section 7.05(a) (other than as set forth or presented in such Projections), and there are no statements or conclusions in any of the Projections which are based upon or include information known to the Borrower to be misleading in any material respect or which fail to take into account material information regarding the matters reported therein. On the Second Restatement Effective Date, the Borrower believed that the Projections were reasonable and attainable, but the Banks acknowledge that actual results may vary from the Projections and such variations may be significant. 7.06 Litigation. There are no actions, suits or proceedings pending or, to the best knowledge of Holdings and the Borrower, threatened (i) with respect to any Document or (ii) that could reasonably be expected to materially and adversely affect the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as a whole. 7.07 True and Complete Disclosure. All factual information (taken as a whole) furnished by or on behalf of Holdings or the Borrower in writing to the Managing Agent or any Bank (including, without limitation, all information contained in the Documents, but excluding the Projections) for purposes of or in connection with this Agreement, the other Credit Documents or any transaction contemplated herein or therein is, and all other such factual information (taken as a whole) hereafter furnished by or on behalf of the Borrower in writing to the Managing Agent or any Bank will be, true and accurate in all material respects on the date as of which such information is dated or certified and not incomplete by omitting to state any fact necessary to make such information (taken as a whole) not misleading in any material respect at such time in light of the circumstances under which such information was provided. 7.08 Use of Proceeds, Margin Regulations. (a) The proceeds of the Loans made on the Second Restatement Effective Date shall be used by the Borrower (i) to repay all Existing Loans and terminate all Commitments under the Existing Credit Agreement, (ii) to finance the Tender Offer, (iii) to finance the Viacom Acquisition and (iv) to pay fees and expenses related to the Transaction. -48- 56 (b) The proceeds of Revolving Loans made after the Second Restatement Effective Date shall be used by the Borrower (i) to finance, in part, the Transaction, (ii) to pay fees and expenses related to the Transaction, (iii) to make acquisitions permitted under Section 9.02(xiii) and (iv) to finance the working capital and general corporate needs of the Borrower and its Subsidiaries. (c) Notwithstanding anything to the contrary contained in clauses (a) or (b) above, the aggregate amount of proceeds of Revolving Loans which are used by the Borrower to finance the Transaction and pay fees and expenses relating thereto shall not exceed $250,000,000. (d) No part of the proceeds of any Loan will be used to purchase or carry any Margin Stock or to extend credit for the purpose of purchasing or carrying any Margin Stock. Neither the making of any Loan nor the use of the proceeds thereof will violate or be inconsistent with the provisions of Regulation G, T, U or X of the Board of Governors of the Federal Reserve System. 7.09 Tax Returns and Payments. Each of Holdings, the Borrower and each of their Subsidiaries have timely filed or caused to be timely filed, on the due dates thereof or within applicable grace periods, with the appropriate taxing -authority, all Federal and all material state returns, statements, forms and reports for taxes (the "Returns") required to be filed by or with respect to the income, properties or operations of Holdings and/or any of its Subsidiaries. The Returns accurately reflect in all material respects all liability for taxes of Holdings, the Borrower and their respective Subsidiaries, as the case may be, for the periods covered thereby. Each of Holdings, the Borrower and their respective Subsidiaries have paid all material taxes payable by them other than taxes which are not delinquent, and other than those contested in good faith and for which adequate reserves have been established in accordance with GAAP. Except as disclosed in the financial statements referred to in Section 7.05(a), there is no material action, suit, proceeding, investigation, audit, or claim now pending or, to the best knowledge of Holdings or the Borrower, threatened by any authority regarding any taxes relating to Holdings, the Borrower or any of their respective Subsidiaries. As of the Second Restatement Effective Date, none of Holdings, the Borrower nor any of their respective Subsidiaries has entered into an agreement or waiver or been requested to enter into an agreement or waiver extending any statute of limitations relating to the payment or collection of taxes of Holdings, the Borrower or any of their respective Subsidiaries, or is aware of any circumstances that would cause the taxable years or other taxable periods of Holdings, the Borrower or any of their respective Subsidiaries not to be subject to the normally applicable statute of limitations. None of Holdings, the Borrower nor any of their respective Subsidiaries has incurred, or will incur, any material tax liability in connection with the Transaction and the other transactions contemplated hereby. -49- 57 7.10 Compliance with ERISA. Each Plan is in substantial compliance with ERISA and the Code; no Reportable Event has occurred with respect to a Plan; no Plan is insolvent or in reorganization; no Plan has an Unfunded Current Liability; no Plan has an accumulated or waived funding deficiency, has permitted decreases in its funding standard account or has applied for an extension of any amortization period within the meaning of Section 412 of the Code; all contributions required to be made with respect to a Plan have been timely made; none of Holdings, the Borrower nor any of their respective Subsidiaries nor any ERISA Affiliate has incurred any material liability to or on account of a Plan pursuant to Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971, 4975 or 4980 of the Code or reasonably expects to incur any material liability under any of the foregoing Sections with respect to any Plan; no proceedings have been instituted to terminate or appoint a trustee to administer any Plan; no condition exists which presents a material risk to Holdings, the Borrower or any of their respective Subsidiaries or any ERISA Affiliate of incurring a material liability to or on account of a Plan pursuant to the foregoing provisions of ERISA and the Code; using actuarial assumptions and computation methods consistent with Part I of subtitle E of Title IV of ERISA, the aggregate liabilities of Holdings, the Borrower, their respective Subsidiaries and their ERISA Affiliates to all Plans which are multiemployer plans (as defined in Section 4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom, as of the close of the most recent fiscal year of each such Plan ended prior to the date of the most recent Credit Event, would not exceed $50,000; no lien imposed under the Code or ERISA on the assets of Holdings, the Borrower or any of their respective Subsidiaries or any ERISA Affiliate exists or is reasonably likely to arise on account of any Plan; and Holdings, the Borrower and their respective Subsidiaries do not maintain or contribute to any employee welfare benefit plan (as defined in Section 3(l) of ERISA) which provides benefits to retired employees or other former employees (other than as required by Section 601 of ERISA) or any employee pension benefit plan (as defined in Section 3(2) of ERISA) the obligations with respect to which could reasonably be expected to have a material adverse effect on the ability of Holdings, the Borrower or any of its Subsidiaries to perform their respective obligations under the Credit Documents to which they are a party. 7.11 The Security Documents. (a) The provisions of the Security Agreements are effective to create in favor of the Collateral Agent for the benefit of the Secured Creditors a legal, valid and enforceable security interest in all right, title and interest of the Credit Parties in the Security Agreement Collateral described therein, and the Security Agreements, upon the filing of Form UCC-1 financing statements or the appropriate equivalent (which filing, if this representation is being made more than 10 days after the Second Restatement Effective Date, has been made), create a fully perfected first lien on, and security interest in, all right, title and interest in all of the Security Agreement Collateral described therein, subject to no other Liens other than -50- 58 Permitted Liens. Each of the Credit Parties party to an Security Agreement has good and indefeasible title to all Security Agreement Collateral described therein, free and clear of all Liens except those described above in this clause (a). (b) The security interests created in favor of the Collateral Agent, as Pledgee, for the benefit of the Secured Creditors under the Pledge Agreements constitute first priority perfected security interests in the Pledged Securities described in the Pledge Agreements, subject to no security interests of any other Person. No filings or recordings are required in order to perfect (or maintain the perfection or priority of) the security interests created in the Pledged Securities and the proceeds thereof under the Pledge Agreements. (c) The Mortgages create, as security for the obligations purported to be secured thereby, a valid and enforceable perfected security interest in and mortgage lien on all of the Mortgaged Properties in favor of the Collateral Agent (or such other trustee as may be required or desired under local law) for the benefit of the Secured Creditors, superior to and prior to the rights of all third persons (except that the security interest and mortgage lien created in the Mortgaged Properties may be subject to Permitted Encumbrances) and subject to no other Liens (other than Liens permitted under Section 9.01). Parts A and B of Schedule III contain a true and complete list of each parcel of Real Property owned or leased by Holdings, the Borrower and their respective Subsidiaries on the Second Restatement Effective Date, and the type of interest therein held by Holdings, the Borrower or such Subsidiary. Holdings, the Borrower and each of their respective Subsidiaries have good and indefeasible title to all Mortgaged Properties free and clear of all Liens except those described in the first sentence of this subsection (c). 7.12 Representations and Warranties in Documents. All representations and warranties set forth in the other Documents were true and correct in all material respects at the time as of which such representations and warranties were made (or deemed made). Notwithstanding anything to the contrary contained in the immediately preceding sentence, it shall not be a misrepresentation pursuant to this Section 7.12 if a representation or warranty made by a Person other than a Credit Party pursuant to a Document (other than a Credit Document) is not true and correct in all material respects, but only if (A)(i) the damages to Holdings and its Subsidiaries as a result of the incorrectness of such representation or warranty are fully covered to the extent in excess of $2,500,000 by (x) the escrow of cash or Cash Equivalents pursuant to an escrow arrangement established for the benefit of Holdings and its Subsidiaries or (y) a guaranty or indemnity issued by a solvent guarantor or indemnitor (with such solvency to be determined after giving effect to the required guaranty or indemnity in respect of the incorrectness of such representations and warranties) and (ii) Holdings or the Borrower, as the case may be, is proceeding in good faith to collect the amounts -51- 59 owing pursuant to the respective escrow arrangement, guaranty or indemnity as a result of the incorrectness of the respective representation or warranty (which action shall be required to include, at such time, if any, as the respective escrow monies are not made available in accordance with the terms of the respective escrow arrangement or the respective guarantor or indemnitor has resisted requests for payment, contesting in good faith and by appropriate proceedings the amounts owing to Holdings and its Subsidiaries) or (B)(i) the period of time expressly provided in such Document for the survival of such representation or warranty has expired, (ii) such representation or warranty is made by a Person other than a Credit Party and (iii) the damages resulting from the incorrectness of such representation or warranty could not reasonably be expected to have a material adverse effect on the business, operations, property, assets, liabilities, condition (financed or otherwise) or prospects of the Borrower or Holdings and its Subsidiaries taken as a whole. 7.13 Properties. Holdings, the Borrower and each of their respective Subsidiaries have good and indefeasible title to all properties (or a valid leasehold estate with respect to leased properties) owned by them after giving effect to the Transaction in accordance with the Documents, including all property reflected in the balance sheet of the Borrower referred to in Section 7.05(a) and in the pro forma balance sheet referred to in Section 5.16, free and clear of all Liens, other than (i) as referred to in the balance sheet or in the notes thereto or in the pro forma balance sheet or (ii) Permitted Liens. 7.14 Capitalization. (a) On or about the Second Restatement Effective Date and after giving effect to the Transaction and the other transactions contemplated hereby, the authorized capital stock of Holdings shall consist of approximately (i) 40,000,000 shares of Class A Common Stock, $.01 par value per share ("Holdings Class A Common Stock"), of which 9,937,320 shares shall be issued and outstanding, (ii) 10,000,000 shares of Class B Common Stock ("Holdings Class B Common Stock"), $.01 par value per share, 8,547,910 shares of which shall be issued and outstanding, (iii) 10,000,000 shares of Class C Common Stock, $.01 par value per share ("Holdings Class C Common Stock"), none of which are outstanding and (iv) 10,000,000 shares of preferred stock, $.01 par value per share, 2,300,000 shares of which shall be designated 7% Convertible Preferred Stock, of which 2,000,000 shares shall be issued and outstanding. All such outstanding shares have been duly and validly issued, are fully paid and non-assessable and have been issued free of preemptive rights. As of the Second Restatement Effective Date, Holdings does not have outstanding any securities convertible into or exchangeable for its capital stock or outstanding any rights to subscribe for or to purchase, or any options for the purchase of, or any agreement providing for the issuance (contingent or otherwise) of, or any calls, commitments or claims of any character relating to, its capital stock, in each case other than (x) the options outstanding or to be issued pursuant to the Dinetz Employment Contract, the -52- 60 Employee Stock Option Plan or the agreements granting certain options to purchase Holdings Class A Common Stock to Ms. Matrice Ellis-Kirk, Mr. Marvin Dinetz, Mr. Eric W. Neumann, Mr. Jeffrey A. Marcus and Mr. John H. Massey and (y) the Convertible Preferred Stock. (b) On the Second Restatement Effective Date and after giving effect to the Transaction and the other transactions contemplated hereby, the authorized capital stock of the Borrower shall consist of (x) 1,000 shares of common stock, $.01 par value per share, all of which shall be issued and outstanding, and (y) 10,000,000 shares of preferred stock, $.01 par value per share, (i) 1,000,000 shares of which are designated Series A Exchangeable Preferred Stock, all of which shall be issued and outstanding and (ii) 3,600,000 shares of which are designated 12% Exchangeable Preferred Stock, of which 2,000,000 shares shall be issued and outstanding. All such outstanding shares have been duly and validly issued, are fully paid and nonassessable, are free of preemptive rights and, in the case of all such outstanding shares of common stock, have been pledged pursuant to the Holdings Pledge Agreement. As of the Second Restatement Effective Date, the Borrower does not have outstanding any securities convertible into or exchangeable for its capital stock or outstanding any rights to subscribe for or to purchase, or any options for the purchase of, or any agreements providing for the issuance (contingent or otherwise) of, or any calls, commitments or claims of any character relating to, its capital stock, other than the Series A Exchangeable Preferred Stock and the Exchangeable Preferred Stock. 7.15 Subsidiaries. As of the Second Restatement Effective Date and after giving effect to the Transaction, Holdings will have no direct or indirect Subsidiaries other than the Borrower, Chancellor Broadcasting Licensee, Trefoil, Shamrock, Shamrock Radio, Shamrock Broadcasting Licenses, Shamrock Broadcasting of Texas, Inc., a Texas corporation, Radio 100 L.L.C., a Delaware limited liability company, KIBB, KYSR, WLIT and WDRQ. 7.16 Compliance with Statutes, etc. Except for matters relating to the compliance by Holdings and its Subsidiaries with Environmental Laws, which matters are governed by the Amended and Restated Environmental Indemnity Agreement and the Environmental Indemnity Agreement, each of Holdings and its Subsidiaries is in compliance with all applicable statutes, regulations and orders of, and all applicable restrictions imposed by, all governmental bodies, domestic or foreign, in respect of the conduct of its business and the ownership of its property, except such noncompliances as could not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as a whole. -53- 61 7.17 Investment Company Act. None of Holdings, the Borrower nor any of their respective Subsidiaries is an "investment company" or a company "controlled" by an "investment company," within the meaning of the Investment Company Act of 1940, as amended. 7.18 Public Utility Holding Company Act. None of Holdings, the Borrower nor any of their respective Subsidiaries 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" within the meaning of the Public Utility Holding Company Act of 1935, as amended. 7.19 Labor Relations. None of Holdings, the Borrower nor any of their respective Subsidiaries is engaged in any unfair labor practice that could reasonably be expected to have a material adverse effect on the Borrower or on Holdings and its Subsidiaries taken as a whole. There is (i) no unfair labor practice complaint pending against Holdings or any of its Subsidiaries or, to the best knowledge of Holdings or the Borrower, threatened against any of them, before the National Labor Relations Board, and no significant grievance or significant arbitration proceeding arising out of or under any collective bargaining agreement is so pending against Holdings or any of its Subsidiaries or, to the best knowledge of Holdings or the Borrower, threatened against any of them, (ii) no strike, labor dispute, slowdown or stoppage pending against Holdings or any of its Subsidiaries or, to the best knowledge of Holdings and the Borrower, threatened against Holdings or any of its Subsidiaries and (iii) to the best knowledge of Holdings and the Borrower, no union representation question existing with respect to the employees of Holdings or any of its Subsidiaries, except (with respect to any matter specified in clause (i), (ii) or (iii) above, either individually or in the aggregate) such as could not reasonably be expected to have a material adverse effect on the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of Borrower or of Holdings and its Subsidiaries taken as a whole. 7.20 Patents, Licenses, Franchises and Formulas. Each of Holdings and its Subsidiaries owns all material patents, trademarks, permits, service marks, trade names, copyrights, licenses, franchises and formulas, or rights with respect to the foregoing, and has obtained assignments of all leases and other rights of whatever nature, necessary for the present conduct of its business, without any known conflict with the rights of others, except such failures to own or obtain and/or conflicts as could not reasonably be likely to result in a material adverse effect on the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as a whole. -54- 62 7.21 Transaction; Bridge Financing. The Transaction and the Bridge Financing have been consummated in all material respects in accordance with the terms of the respective Documents and all applicable laws. All consents and approvals of, and filings and registrations with, and all other actions in respect of, all governmental agencies, authorities or instrumentalities (including the consent from the FCC approving the transfer of the FCC Licenses contemplated by the Documents which consent shall have become final) required in order to make or consummate the Transaction or the Bridge Financing will have been obtained, given, filed or taken and are or will be in full force and effect (or effective judicial relief with respect thereto has been obtained), except where the failure to so obtain, give, file or take would not have a material adverse effect on the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as whole. All applicable waiting periods with respect thereto have or, prior to the time when required, will have, expired without, in all such cases, any action being taken by any competent authority which restrains, prevents, or imposes material adverse conditions upon the Transaction or the Bridge Financing. Additionally, there does not exist any judgment, order or injunction prohibiting or imposing material adverse conditions upon the Transaction, the Bridge Financing, or any Credit Event or the performance by any Credit Party of its obligations under the respective Documents. All actions taken by each Credit Party pursuant to or in furtherance of the Transaction or the Bridge Financing have been taken in compliance with the respective Documents and all applicable laws. 7.22 Special Purpose Corporations. Holdings was formed for the purpose of holding all of the capital stock of the Borrower and is authorized to effect the Transaction and the Bridge Financing and, except in connection with the foregoing (or as may be permitted by this Agreement), Holdings engages in no business activities and has no significant assets (other than the stock of the Borrower) or liabilities (other than liabilities which are expressly permitted under this Agreement). Chancellor Broadcasting Licensee was formed for the purpose of holding all rights, title and interests in certain of the FCC Licenses to be used by the Borrower and its Subsidiaries in connection with their respective businesses and otherwise engages in no business activities and has no significant assets or liabilities. 7.23 FCC Licenses. After giving effect to the Transaction, the License Subsidiary holds such validly issued FCC licenses and authorizations as are necessary to operate the Stations as they are currently operated (collectively, the "FCC Licenses"), each of which is in full force and effect. The FCC Licenses as of the Second Restatement Effective Date are listed on Schedule IV (with the Viacom FCC Licenses being designated as such on Schedule IV), each of which FCC Licenses has the expiration date indicated on Schedule IV. Neither Holdings nor the Borrower has knowledge of any material adverse condition imposed by the FCC as part of any FCC -55- 63 License which is neither set forth on the face thereof as issued by the FCC nor contained in the rules and regulations of the FCC applicable generally to stations of the type, nature, class or location of each Station. Except as set forth on Annex 5.07, each Station is being operated in all material respects in accordance with the terms and conditions of the FCC Licenses applicable to it and in accordance with the rules and regulations of the FCC and the Communications Act of 1934, as amended (the "Communications Act"). Except as set forth on Annex 5.07, no proceedings are pending or, to the knowledge of Holdings or the Borrower, are threatened which may reasonably be expected to result in the revocation, modification, non-renewal or suspension of any of the FCC Licenses, the denial of any pending applications, the issuance of any cease and desist order or the imposition of any material fines, forfeitures or other administrative actions by the FCC with respect to the Stations or their operation, other than proceedings affecting the radio broadcasting industry in general. Except as set forth on Annex 5.07, reports, applications and other documents required to be filed by any Credit Party with the FCC with respect to the Stations have in all material respects been timely filed and all such reports, applications and documents are true, correct and complete in all material respects, and neither Holdings nor the Borrower has knowledge of any matters (i) which could reasonably be expected to result in the suspension or revocation of or the refusal to renew any of the FCC Licenses or the imposition of any material fines or forfeitures by the FCC upon any Credit Party or (ii) which could reasonably be expected to result in the modification or revocation of any FM Station's authorization to operate as currently authorized, or any AM Station's authorization to operate as currently authorized, as applicable, under the rules and regulations of the FCC. There are no unsatisfied or otherwise outstanding notices of apparent liability or violations issued by the FCC with respect to any Station or its operations. The Borrower has delivered to the Banks true and complete copies of the FCC Licenses (including any and all amendments and other modifications thereto). 7.24 Subordinated Notes. As of the Second Restatement Effective Date, the subordination provisions contained in the Existing Senior Subordinated Notes (if any), the 12-1/4% Junior Exchange Debentures and the 12% Junior Exchange Debentures are enforceable by the Banks against the Borrower and any holders thereof, and all Obligations of the Borrower hereunder or under the other Credit Documents are or will be within the definition of "Senior Debt" included in such provisions of the Existing Senior Subordinated Note Documents or the documents relating to the 12-1/4% Junior Exchange Debentures or 12% Junior Exchange Debentures. SECTION 8. Affirmative Covenants. Holdings and the Borrower hereby covenant and agree that on and after the Second Restatement Effective Date and until the Total Commitments and all Letters of Credit have terminated and the Loans, -56- 64 Notes and Unpaid Drawings, together with interest, Fees and all other Obligations incurred hereunder and thereunder, are paid in full: 8.01 Information Covenants. Holdings and/or the Borrower will furnish to each Bank: (a) Monthly Reports. Within 30 days after the end of each fiscal month (other than the fiscal months ending March, June, September and December) of Holdings, (i) the combined and combining balance sheets of Holdings and its Consolidated Subsidiaries for each fiscal month, each as of the end of such month and the related combined and combining statements of income and statements of cash flows for such month and for the last elapsed portion of the fiscal year ended with the last day of such month, in each case setting forth in the statements of income only, the comparative figures for the corresponding month in the prior fiscal year and the budgeted figures for such month as set forth in the respective budgets delivered pursuant to Section 8.01(e) and (ii) the balance sheets of each of the Stations on an individual basis as of the end of such month and the related statements of income and statements of cash flows for such month and for the elapsed portion of the fiscal year ended with the last day of such month, in each case setting forth in the statements of income only, the comparative figures for the corresponding month in the prior fiscal year and the budgeted figures for such month as set forth in the respective budgets delivered pursuant to Section 8.01(e). (b) Quarterly Financial Statements. As soon as available and in any event within 45 days after the close of each of the first three quarterly accounting periods in each fiscal year of Holdings, (i) the combined and combining balance sheets of Holdings and its Consolidated Subsidiaries for each fiscal quarter, each as of the end of such quarter and the related combined and combining statements of income and statements of cash flows for such quarter and for the last elapsed portion of the fiscal year ended with the last day of such quarter and setting forth in the statements of income only, the comparative figures for the corresponding quarter in the prior fiscal year and the budgeted figures for such quarter as set forth in the respective budgets delivered pursuant to Section 8.01(e), and (ii) the balance sheets of each of the Stations as of the end of such quarter and the related statements of income and statements of cash flows for such quarter and for the elapsed portion of the fiscal year ended with the last day of such quarter, in each case setting forth in the statements of income only, the comparative figures for the corresponding quarter in the prior fiscal year and the budgeted figures for such quarter as set forth in the respective budgets delivered pursuant to Section 8.01(e). -57- 65 (c) Annual Financial Statements. Within 95 days after the close of each fiscal year of Holdings, (i) the consolidated and consolidating balance sheets of Holdings and its Consolidated Subsidiaries for each fiscal year, each as at the end of such fiscal year and the related statements of income and retained earnings and of cash flows for such fiscal year and, setting forth comparative figures for the preceding fiscal year and certified, in the case of such consolidated statements, by Coopers & Lybrand L.L.P. or such other independent certified public accountants of recognized national standing reasonably acceptable to the Managing Agent, together with a report of such accounting firm (which report shall be unqualified as to scope) stating that in the course of its regular audit of the financial statements of Holdings and its Subsidiaries, which audit was conducted in accordance with generally accepted auditing standards, such accounting firm obtained no knowledge of any Default or Event of Default under Sections 9.03, 9.04, 9.05 and 9.07 through 9.10, inclusive, which has occurred and is continuing or, if in the opinion of such accounting firm such a Default or Event of Default has occurred and is continuing, a statement as to the nature thereof, (ii) the balance sheets of each of the Stations at the end of such fiscal year and the related statement of income and retained earnings and statement of cash flows for such fiscal year, in each case setting forth comparative figures for the preceding fiscal year for income statements only, and (iii) management's discussions and analysis of the important operational and financial developments during such fiscal year in respect of Holdings and its Subsidiaries. (d) Management Letters. Promptly after the receipt thereof by Holdings or any of its Subsidiaries, a copy of any final "management letter" received by Holdings or such Subsidiary from its certified public accountants and a copy of management's responses thereto. (e) Budgets. No later than 30 days following the commencement of the first day of each fiscal year of Holdings, a budget in form satisfactory to the Managing Agent prepared by Holdings for (x) in the case of budgeted statements of income, each of the twelve months of such fiscal year prepared in detail, and (y) in the case of budgeted statements of sources and uses of cash and balance sheets, for such fiscal year on an annual basis and prepared in detail and for each of the four years immediately following such fiscal year prepared in summary form, in each case, of each of Holdings and its Subsidiaries and each of the Stations on an individual basis accompanied by the statement of the President, Chief Financial Officer or Senior Vice President of Finance of the Borrower to the effect that, to the best of his knowledge, the budget is a reasonable estimate for the period covered thereby. -58- 66 (f) Officer's Certificates. At the time of the delivery of the financial statements provided for in Sections 8.01(a), (b) and (c), a certificate of an Authorized Officer of the Borrower to the effect that, to the best of such officer's knowledge, no Default or Event of Default has occurred and is continuing or, if any Default or Event of Default has occurred and is continuing, specifying the nature and extent thereof, which certificate shall, in the case of any such financial statements delivered in respect of a period ending on the last day of a fiscal quarter or year of Holdings, (x) set forth the calculations required to establish whether the Borrower was in compliance with the provisions of Sections 9.03, 9.04, 9.05, and 9.07 through 9.10, inclusive, at the end of such fiscal quarter or year, as the case may be and (y) if delivered with the financial statements required by Section 8.01(c), set forth the calculations required to establish whether the Borrower was in compliance with the provisions of Section 4.02(f) and set forth the amount of Excess Cash Flow (if any) for the respective Excess Cash Payment Period. (g) Notice of Default or Litigation. Promptly, and in any event within three Business Days after an officer of Holdings or the Borrower obtains knowledge thereof, notice of (i) the occurrence of any event which constitutes a Default or Event of Default and (ii) any litigation or governmental investigation or proceeding pending (x) against Holdings or any of its Subsidiaries which could reasonably be expected to materially and adversely affect the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or Holdings and its Subsidiaries taken as a whole, (y) with respect to any material Indebtedness of the Borrower and its Subsidiaries taken as a whole or (z) with respect to any other Document which could reasonably be expected to materially and adversely affect the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as a whole. (h) Other Reports and Filings. Promptly, copies of all (x) financial information, proxy materials and other information and reports, if any, which Holdings or any of its Subsidiaries shall file with the Securities and Exchange Commission or any successor thereto (the "SEC") including, without limitation, in connection with the issuance of the Existing Senior Subordinated Notes or, if issued, the 12-1/4% Junior Exchange Debentures, the 12% Junior Exchange Debentures or any securities issued pursuant to the OmniAmerica Equity Issuance, or deliver to holders of its Indebtedness pursuant to the terms of the documentation governing such Indebtedness (or any trustee, agent or other representative therefor) and (y) material filings or communications with the FCC or under, or as required by, the Communications Act. -59- 67 (i) Annual Meetings with Banks. At the request of the Managing Agent or the Required Banks, Holdings shall within 120 days after the close of each fiscal year of Holdings hold a meeting at a time and place selected by Holdings and acceptable to the Managing Agent with all of the Banks at which meeting shall be reviewed the financial results of the previous fiscal year and the financial condition of Holdings and the budgets presented for the current fiscal year of Holdings and its Subsidiaries. (j) Other Information. From time to time, such other information or documents (financial or otherwise) with respect to Holdings or its Subsidiaries as any Bank may reasonably request in writing. 8.02 Books, Records and Inspections. Holdings will, and will cause each of its Subsidiaries to, keep proper books of record and account in which full, true and correct entries in conformity with GAAP and all requirements of law shall be made of all dealings and transactions in relation to its business and activities. Holdings will, and will cause each of its Subsidiaries to, permit officers and designated representatives of the Managing Agent or any Bank to visit and inspect, during regular business hours and under guidance of officers of Holdings, the Borrower or such Subsidiary, any of the properties of Holdings, the Borrower or such Subsidiary, and to examine the books of account of Holdings, the Borrower or such Subsidiary and discuss the affairs, finances and accounts of Holdings, the Borrower or such Subsidiary with, and be advised as to the same by, its and their officers and independent accountants, all at such reasonable times and intervals and to such reasonable extent as the Managing Agent or such Bank may request. 8.03 Maintenance of Property; Insurance. (a) Schedule V sets forth a true and complete listing of all insurance maintained by Holdings, and its Subsidiaries as of the Second Restatement Effective Date. Holdings will, and will cause each of its Subsidiaries to, (i) keep all property necessary in its business in good working order and condition (ordinary wear and tear excepted), (ii) maintain insurance on all its property in at least such amounts and against at least such risks as is consistent and in accordance with industry practice and (iii) furnish to each Bank, upon written request, full information as to the insurance carried. In addition to the requirements of the immediately preceding sentence, Holdings and the Borrower will at all times cause insurance of the types described in Schedule V to be maintained (with the same scope of coverage as that described in Schedule V) at levels which are at least as great as the respective amount described opposite the respective type of insurance on Schedule V under the column headed "Minimum to be Maintained. " (b) Holdings will, and will cause its Subsidiaries to, at all times keep their respective property insured in favor of the Collateral Agent, and all policies or -60- 68 certificates (or certified copies thereof) with respect to such insurance (and any other insurance maintained by Holdings or any of its Subsidiaries) (i) shall be endorsed to the Collateral Agent's satisfaction for the benefit of the Collateral Agent (including, without limitation, by naming the Collateral Agent as loss payee or as an additional insured), (ii) shall state that such insurance policies shall not be cancelled without 30 days' prior written notice thereof by the respective insurer to the Collateral Agent, (iii) shall provide that the respective insurers irrevocably waive any and all rights of subrogation with respect to the Collateral Agent and the Secured Creditors, (iv) shall contain the standard non-contributory mortgagee clause endorsement in favor of the Collateral Agent with respect to hazard insurance coverage, (v) shall, except in the case of public liability insurance and workers' compensation insurance, provide that any losses shall be payable notwithstanding (A) any act or neglect of Holdings or any of its Subsidiaries, (B) the occupation or use of the properties for purposes more hazardous than those permitted by the terms of the respective policy if such coverage is obtainable at commercially reasonable rates and is of the kind from time to time customarily insured against by Persons owning or using similar property and in such amounts as are customary, (C) any foreclosure or other proceeding relating to the insured properties if such coverage is available at commercially reasonable rates or (D) any change in the title to or ownership or possession of the insured properties if such coverage is available at commercially reasonable rates and (vi) shall be deposited with the Collateral Agent. (c) If Holdings or any of its Subsidiaries shall fail to maintain all insurance in accordance with this Section 8.03, or if Holdings or any of its Subsidiaries shall fail to so endorse and deposit all policies or certificates with respect thereto, the Managing Agent and/or the Collateral Agent shall have the right (but shall be under no obligation) to procure such insurance and the Borrower agrees to reimburse the Managing Agent or the Collateral Agent as the case may be, for all costs and expenses of procuring such insurance. 8.04 Corporate Franchises. Holdings will, and will cause each of its Subsidiaries to, do or cause to be done, all things necessary to preserve and keep in full force and effect its existence and its material rights, franchises, licenses and patents (including the rights of the Borrower and the License Subsidiary under the Asset Use and Operating Agreement dated January 10, 1994 and the two separate Asset Use and Operating Agreements dated October 12, 1994, respectively) (each an "Operating Agreement," and, collectively, the "Operating Agreements"); provided that nothing in this Section 8.04 shall prevent (i) sales of assets by Holdings or any of its Subsidiaries in accordance with Section 9.02 or (ii) the withdrawal by Holdings or any of its Subsidiaries of their qualification as a foreign corporation in any jurisdiction where such withdrawal could not reasonably be expected to have a material adverse effect on the business, operations, property, assets, liabilities or condition (financial or otherwise) of the Borrower or of Holdings and its Subsidiaries taken as a whole. -61- 69 8.05 Compliance with Statutes, etc. Except for matters relating to compliance by Holdings and its Subsidiaries with Environmental Laws, which matters are governed by the Amended and Restated Environmental Indemnity Agreement and the Environmental Indemnity Agreement, Holdings will, and will cause each of its Subsidiaries to, comply with all applicable statutes, regulations and orders of, and all applicable restrictions imposed by, all governmental bodies, domestic or foreign, in respect of the conduct of its business and the ownership of its property, except such noncompliances as could not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as a whole. 8.06 ERISA. As soon as possible and, in any event, within 20 days after Holdings, the Borrower or any of their respective Subsidiaries or any ERISA Affiliate knows or has reason to know of the occurrence of any of the following, Holdings or the Borrower will deliver to each of the Banks a certificate of an Authorized Officer of Holdings or the Borrower setting forth details as to such occurrence and the action, if any, that Holdings, the Borrower, such Subsidiary or such ERISA Affiliate is required or proposes to take, together with any notices required or proposed to be given to or filed with or by Holdings, the Borrower, such Subsidiary, the ERISA Affiliate, the PBGC, or a Plan participant or the Plan administrator with respect thereto: that a Reportable Event has occurred; that an accumulated funding deficiency has been incurred or an application is likely to be or has been made to the Secretary of the Treasury for a waiver or modification of the minimum funding standard (including any required installment payments) or an extension of any amortization period under Section 412 of the Code with respect to a Plan; that a contribution required to be made to a Plan has not been timely made; that a Plan has been or is reasonably expected to be terminated, reorganized, partitioned or declared insolvent under Title IV of ERISA; that a Plan has an Unfunded Current Liability giving rise to a lien under ERISA or the Code; that proceedings are likely to be or have been instituted or notice has been given to terminate or appoint a trustee to administer a Plan, that a proceeding has been instituted pursuant to Section 515 of ERISA to collect a delinquent contribution to a Plan; that Holdings, the Borrower, any of their respective Subsidiaries or any ERISA Affiliate will or is reasonably expected to incur any liability (including any contingent or secondary liability) to or on account of the termination of or withdrawal from a Plan under Section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with respect to a Plan under Section 401(a)(29), 4971 or 4975 of the Code or Section 409 or 502(i) or 502(l) of ERISA; or that Holdings, the Borrower or any Subsidiary may incur any material liability pursuant to any employee welfare benefit plan (as defined in Section 3(l) of ERISA) that provides benefits to retired employees or other former employees (other than as required by Section 601 of ERISA) or any employee pension benefit plan (as defined in Section 3(2) of ERISA). Upon request the -62- 70 Borrower will deliver to each of the Banks a complete copy of the annual report (Form 5500) of each Plan required to be filed with the Internal Revenue Service. In addition to any certificates or notices delivered to the Banks pursuant to the first sentence hereof, copies of annual reports and any material notices received by Holdings, the Borrower or any of their respective Subsidiaries or any ERISA Affiliate with respect to any Plan shall be delivered to the Banks no later than 20 days after the date such report has been filed with the Internal Revenue Service or such notice has been received by Holdings, the Borrower, the Subsidiary or the ERISA Affiliate, as applicable. 8.07 End of Fiscal Years; Fiscal Quarters. Holdings shall cause (i) each of its, and each of its Subsidiaries', fiscal years to end on December 31, and (ii) each of its, and each of its Subsidiaries', fiscal quarters to end on March 31, June 30 and September 30. 8.08 Performance of Obligations. Holdings will, and will cause each of its Subsidiaries to, perform all of their obligations under the terms of each mortgage, indenture, security agreement and other debt instrument by which it is bound, except such non-performances as could not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as a whole. 8.09 Payment of Taxes. Holdings will pay and discharge or cause to be paid and discharged, and will cause each of its Subsidiaries to pay and discharge, all material taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits, or upon any material properties belonging to it, in each case on a timely basis, and all lawful claims which, if unpaid, might become a lien or charge upon any properties of Holdings or any of its Subsidiaries; provided that none of Holdings nor any of its Subsidiaries shall be required to pay any such tax, assessment, charge, levy or claim which is being contested in good faith and by proper proceedings if it has maintained adequate reserves with respect thereto in accordance with GAAP. 8.10 Maintenance of Separateness. Holdings will, and will cause each of its Subsidiaries to, satisfy customary corporate formalities including the holding of regular board of directors' and shareholders' meetings and the maintenance of corporate offices and records. None of the Borrower nor any of its Subsidiaries shall make any payment to a creditor of Holdings in respect of any liability of Holdings which is not a liability of the Borrower or such Subsidiary, and no bank account of Holdings shall be commingled with any bank account of the Borrower or any of its Subsidiaries. Any financial statements distributed to any creditors of Holdings shall, to the extent permitted by GAAP, clearly establish the corporate separateness of Holdings from the Borrower and its Subsidiaries. Finally, neither Holdings nor any of its Subsidiaries shall -63- 71 take any action, or conduct its affairs in a manner, which is likely to result in the corporate existence of Holdings being ignored, or in the assets and liabilities of the Borrower or any of its Subsidiaries being substantively consolidated with those of Holdings in a bankruptcy, reorganization or other insolvency proceeding. 8.11 Dividends on Series A Exchangeable Preferred Stock and Exchangeable Preferred Stock, Interest on Bridge Financing . The Borrower will pay all dividends on (x) the Series A Exchangeable Preferred Stock through the accretion of the liquidation preference on the Series A Exchangeable Preferred Stock rather than in cash, except as otherwise permitted to be paid in cash pursuant to Section 9.03(x), and (y) the Exchangeable Preferred Stock (including at any time on or after January 15, 2002) solely through the issuance of additional shares of Exchangeable Preferred Stock rather than in cash, except as permitted to be paid in cash pursuant to Section 9.03(x). 8.12 Additional Security, Further Assurances. (a) Holdings and the Borrower will, and will cause each of their respective Subsidiaries to, grant to the Collateral Agent security interests in Reinvestment Assets at the time of the acquisition thereof as described in this clause (a). To the extent Reinvestment Assets are acquired by the Borrower and/or its Subsidiaries, the Borrower or such Subsidiary shall grant a Lien on and a security interest in such Reinvestment Assets on the same terms as set forth in the Security Documents and as otherwise set forth in this Section 8.12. To the extent Reinvestment Assets are acquired by a merger or the acquisition of capital stock, the Borrower shall cause the Person acquiring such Reinvestment Assets to become a Subsidiary of the Borrower and/or its Subsidiaries, and shall pledge or cause to be pledged all capital stock of any such Person so acquired pursuant to the Amended and Restated Borrower Pledge Agreement or the Amended and Restated Subsidiary Pledge Agreement and cause such Person to enter into an additional guaranty substantially similar to the Subsidiary Guaranty and additional security documents substantially similar to the Security Documents, all as otherwise as set forth in this Section 8.12; provided that, absent a change in the relevant sections of the Code or the rules, regulations, rulings, notices or other official pronouncements issued or promulgated thereunder, the Borrower and its Subsidiaries shall be required to only pledge 65% of the voting capital stock of a foreign Subsidiary and no foreign Subsidiary shall be required to enter into such guaranty or Security Documents; provided further, the Borrower and its Subsidiaries shall not be required to grant a security interest in any Reinvestment Assets that are acquired subject to a Lien permitted by Section 9.01(vii), (viii) or (xx). (b) Holdings will, and will cause each of its Subsidiaries to, grant to the Collateral Agent security interests and mortgages (an "Additional Mortgage") in such Real Property of Holdings or any of its Subsidiaries as are not covered by the Existing Mortgages or Mortgages to the extent acquired after the Second Restatement Effective Date, and as may reasonably be requested from time to time by the Managing Agent -64- 72 or the Required Banks (each such Real Property, an "Additional Mortgaged Property"). All such Additional Mortgages shall be granted pursuant to documentation substantially in the form of the Mortgages or in such other form as is reasonably satisfactory to the Managing Agent and shall constitute valid and enforceable perfected Liens superior to and prior to the rights of all third Persons and subject to no other Liens except as are permitted by Section 9.01 at the time of perfection thereof. The Additional Mortgages or instruments related thereto shall have been duly recorded or filed in such manner and in such places as are required by law to establish, perfect, preserve and protect the Liens in favor of the Collateral Agent required to be granted pursuant to the Additional Mortgages and all taxes, fees and other charges payable in connection therewith shall have been paid in full. Notwithstanding anything to the contrary stated above in this clause (b), Holdings and its Subsidiaries shall be required to only grant Additional Mortgages in fee owned Real Property with a fair market value at the time of acquisition thereof in excess of $500,000. (c) Holdings will, and will cause each of its Subsidiaries to, grant to the Collateral Agent security interests in assets acquired pursuant to Sections 9.02(ix), (xiii) and (xv) at the time of the acquisition thereof as described in this clause (c). To the extent assets are acquired by the Borrower or any of its Subsidiaries pursuant to such Sections, the Borrower or such Subsidiary shall grant a Lien on and a security interest in such assets on the same terms as set forth in the Security Documents and as otherwise set forth in this Section 8.12. In connection with the acquisition of the capital stock of a Person pursuant to such Sections, the Borrower shall cause such Person to become a direct or indirect Subsidiary of the Borrower, and shall pledge or cause to be pledged all capital stock of any such Person so acquired pursuant to the Amended and Restated Borrower Pledge Agreement, the Amended and Restated Subsidiary Pledge Agreement or the Subsidiary Pledge Agreement, as applicable, and cause such Person to enter into an additional guaranty substantially similar to the Subsidiary Guaranty and additional security documents substantially similar to the Security Documents, all as otherwise set forth in this Section 8.12; provided that, absent a change in the relevant sections of the Code or the rules, regulations, rulings, notices or other official pronouncements issued or promulgated thereunder, the Borrower and its Subsidiaries shall be required to only pledge 65% of the voting capital stock of a foreign Subsidiary and no foreign Subsidiary shall be required to enter into such guaranty or Security Documents; provided further, that the Borrower and its Subsidiaries shall not be required to grant a security interest in such assets that are acquired subject to a Lien permitted by Section 9.01(vii), (viii) or (xx). Notwithstanding anything to the contrary contained above, Holdings and its Subsidiaries shall be required to only grant Additional Mortgages in fee owned Real Property with a fair market value at the time of acquisition in excess of $500,000. -65- 73 (d) Holdings will, and will cause each of its Subsidiaries to, at the expense of the Borrower, make, execute, endorse, acknowledge, file and/or deliver to the Collateral Agent from time to time such vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, powers of attorney, certificates, real property surveys, reports and other assurances or instruments and take such further steps relating to the Collateral covered by any of the Security Documents as the Collateral Agent may reasonably require pursuant to this Section 8.12. Furthermore, Holdings and the Borrower shall cause to be delivered to the Collateral Agent such opinions of counsel, title insurance and other related documents as may be requested by the Collateral Agent to assure itself that this Section 8.12 has been complied with. (e) Holdings will cause each Subsidiary established or created in accordance with Section 9.15 to execute and deliver a guaranty of all Obligations and all obligations under Interest Rate Protection Agreements in substantially the form of the Subsidiary Guaranty; provided that absent a change in the relevant sections of the Code or the rules, regulations, rulings, notices or other official pronouncements issued or promulgated thereunder, no foreign Subsidiary shall be required to enter into such guaranty. (f) Holdings will cause each Subsidiary established or created in accordance with Section 9.15 to grant to the Collateral Agent a first priority Lien on all property (tangible and intangible) of such Subsidiary upon terms similar to those set forth in the Security Documents as appropriate, and satisfactory in form and substance to the Collateral Agent and Required Banks; provided that, absent a change in the relevant sections of the Code or the rules, regulations, rulings, notices or other official pronouncements issued or promulgated thereunder, no foreign Subsidiary shall be required to enter into such Security Documents; provided further, that the Borrower and its Subsidiaries shall not be required to grant a security interest in such assets that are acquired subject to a Lien permitted by Section 9.01(vii), (viii) or (xx); provided further, that such Subsidiary shall be required to only grant Additional Mortgages in fee owned Real Property with a fair market value at the time of acquisition in excess of $500,000. Holdings and the Borrower will cause each Subsidiary, at its own expense, to execute; acknowledge and deliver, or cause the execution, acknowledgment and delivery of, and thereafter register, file or record in any appropriate governmental office, any document or instrument reasonably deemed by the Collateral Agent to be necessary or desirable for the creation and perfection of the foregoing Liens. Holdings and the Borrower will cause each of its Subsidiaries to take all actions requested by the Collateral Agent (including, without limitation, the filing of UCC-1's) in connection with the granting of such security interests. -66- 74 (g) The security interests required to be granted pursuant to this Section 8.12 shall be granted pursuant to security documentation (which shall be substantially similar to the Security Documents already executed and delivered by the Borrower or its Subsidiaries, as applicable) or otherwise satisfactory in form and substance to the Managing Agent and shall constitute valid and enforceable perfected security interests prior to the rights of all third Persons and subject to no other Liens except such Liens as are permitted by Section 9.01. The Additional Security Documents and other instruments related thereto shall be duly recorded or filed in such manner and in such places and at such times as are required by law to establish, perfect, preserve and protect the Liens, in favor of the Collateral Agent for the benefit of the respective Secured Creditors, required to be granted pursuant to the Additional Security Documents and all taxes, fees and other charges payable in connection therewith shall be paid in full by the Borrower. At the time of the execution and delivery of the Additional Security Documents, the Borrower shall cause to be delivered to the Collateral Agent such opinions of counsel, Mortgage Policies, title surveys, real estate appraisals and other related documents as may be reasonably requested by the Managing Agent or the Required Banks to assure themselves that this Section 8.12 has been complied with. (h) Each of Holdings and the Borrower agrees that each action required above by Section 8.12(d) shall be completed as soon as possible, but in no event later than 60 days after such action is requested to be taken by the Managing Agent or the Required Banks. Each of Holdings and the Borrower further agrees that each action required by Sections 8.12(a) (to the extent applicable in connection with the creation or acquisition of a new Subsidiary), (c), (e), (f) and (g) with respect to Additional Collateral shall be completed contemporaneously with the creation of such new Subsidiary. 8.13 Designation of Agent. If for any reason the agent designated by Holdings and the Borrower in Section 13.08(a) shall cease to be available to act in such capacity, Holdings and the Borrower shall designate, appoint and empower a new agent in the City of New York satisfactory to the Managing Agent on the terms and for the purposes set forth in Section 13.08(a). SECTION 9. Negative Covenants. Holdings and the Borrower covenant and agree that on and after the Second Restatement Effective Date and until the Total Commitments and all Letters of Credit have terminated and the Loans, Notes and Unpaid Drawings, together with interest, Fees and all other Obligations incurred hereunder and thereunder, are paid in full: 9.01 Liens. Holdings will not, and will not permit any of its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with respect to any -67- 75 property or assets (real or personal, tangible or intangible) of Holdings or any of its Subsidiaries, whether now owned or hereafter acquired, or sell any such property or assets subject to an understanding or agreement, contingent or otherwise, to repurchase such property or assets (including sales of accounts receivable with recourse to Holdings or any of its Subsidiaries), or assign any right to receive income or permit the filing of any financing statement under the UCC or any other similar notice of Lien under any similar recording or notice statute; provided that the provisions of this Section 9.01 shall not prevent the creation, incurrence, assumption or existence of the following (Liens described below are herein referred to as "Permitted Liens"): (i) inchoate Liens for taxes, assessments or governmental charges or levies not yet due and payable or Liens for taxes, assessments or governmental charges or levies being contested in good faith and by appropriate proceedings for which adequate reserves have been established in accordance with GAAP; (ii) Liens in respect of property or assets of the Borrower or any of its Subsidiaries imposed by law, which were incurred in the ordinary course of business and do not secure Indebtedness for borrowed money, such as carriers', warehousemen's, materialmen's and mechanics' liens and other similar Liens arising in the ordinary course of business, and (x) which do not in the aggregate materially detract from the value of the Borrower's or such Subsidiary's property or assets or materially impair the use thereof in the operation of the business of the Borrower or such Subsidiary or (y) which are being contested in good faith by appropriate proceedings, which proceedings have the effect of preventing the forfeiture or sale of the property or assets subject to any such Lien; (iii) Liens in existence on the Second Restatement Effective Date which are listed, and the property subject thereto described, in Schedule VI, but only to the respective date, if any, set forth in such Schedule VI for the removal and termination of any such Liens, plus renewals, replacements and extensions of such Liens to the extent set forth on Schedule VI, provided that (x) the aggregate principal amount of the Indebtedness, if any, secured by such Liens does not increase from that amount outstanding at the time of any such renewal, replacement or extension and (y) any such renewal, replacement or extension does not encumber any additional assets or properties of Holdings or any of its Subsidiaries; (iv) Permitted Encumbrances; (v) Liens created pursuant to the Security Documents; -68- 76 (vi) licenses, leases or subleases granted to other Persons in a manner consistent with past practice or the radio industry generally not materially interfering with the conduct of the business of Holdings and its Subsidiaries taken as a whole; (vii) Liens upon assets subject to Capitalized Lease Obligations to the extent permitted by Section 9.04, provided that (x) such Liens only serve to secure the payment of Indebtedness arising under such Capitalized Lease Obligation and (y) the Lien encumbering the asset giving rise to the Capitalized Lease Obligation does not encumber any other asset of the Borrower or any Subsidiary of the Borrower; (viii) Liens placed upon equipment or machinery used in the ordinary course of business of the Borrower or any of its Subsidiaries at the time of acquisition thereof by the Borrower or any such Subsidiary or within 120 days thereafter to secure Indebtedness incurred to pay all or a portion of the purchase price thereof and all renewals, replacements or extensions thereof, provided that (x) the aggregate outstanding principal amount of all Indebtedness secured by Liens permitted by this clause (viii) shall not at any time exceed $5,000,000 and (y) in all events, the Lien encumbering the equipment or machinery so acquired does not encumber any other asset of the Borrower or such Subsidiary; (ix) easements, rights-of-way, restrictions (including zoning restrictions), encroachments, protrusions and other similar charges or encumbrances, and minor title deficiencies, in each case whether now or hereafter in existence, not securing Indebtedness and not materially interfering with the conduct of the business of the Borrower or any of its Subsidiaries; (x) Liens arising from precautionary UCC financing statement filings regarding operating leases entered into by Holdings or any of its Subsidiaries in the ordinary course of business; (xi) Liens arising out of the existence of judgments or awards not constituting an Event of Default under Section 10.09, provided that no cash or property is deposited or delivered to secure the respective judgment or award (or any appeal bond in respect thereof, other than appeal bonds secured by deposits not to exceed $5,000,000 in the aggregate); (xii) statutory, contractual and common law landlords' liens under leases to which the Borrower or any of its Subsidiaries is a party; -69- 77 (xiii) Liens (other than any Lien imposed by ERISA) incurred or deposits made in the ordinary course of business in connection with workers' compensation, unemployment insurance and other types of social security, or to secure the performance of tenders, statutory obligations, surety, stay, customs bonds, statutory bonds (other than appeal bonds), bids, leases, government contracts, trade contracts, performance and return of money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money); (xiv) any interest or title of a lessor, sublessor, licensee or licensor under any lease or license agreement permitted by this Agreement; (xv) Liens in favor of a banking institution arising as a matter of law encumbering deposits (including the right of set-off) held by such banking institutions incurred in the ordinary course of business and which are within the general parameters customary in the banking industry; (xvi) deposits made in the ordinary course of business to secure liabilities for premiums to insurance carriers, provided that such deposits do not exceed in the aggregate an amount equal to $2,500,000 at any time; (xvii) Liens arising out of conditional sale, title retention, consignment or similar arrangements for sale of goods entered into by the Borrower or any of its Subsidiaries in the ordinary course of business, in accordance with past practices of the Borrower and its Subsidiaries; (xviii) Liens created to secure obligations permitted by Section 9.02(xi); (xix) cash earnest money deposits in connection with acquisitions otherwise permitted by Section 9.02 in an amount not to exceed that amount, when added to the Stated Amount of all Letters of Credit issued to provide assurance of performance in connection with acquisitions otherwise permitted by Section 9.02, which equals $40,000,000 at any time outstanding; (xx) Liens on property or assets in existence at the time such property or assets are acquired pursuant to Section 9.02(ix), (xiii) or (xiv), provided that (x) any Indebtedness that is secured by such Liens is permitted to exist under Section 9.04(xv) and (y) such Liens are not incurred in connection with, or in contemplation or anticipation of, such acquisition and do not attach to any other asset of Holdings or any of its Subsidiaries; and -70- 78 (xxi) Liens not otherwise permitted under this Section 9.01 to the extent attaching to properties and assets with an aggregate fair market value not in excess of, and securing liabilities not in excess of, $2,500,000 in the aggregate at any time outstanding. 9.02 Consolidation, Merger, Purchase or Sale of Assets, etc. Holdings will not, and will not permit any of its Subsidiaries to, wind up, liquidate or dissolve its affairs or merge, consolidate, convey, sell, lease or otherwise dispose of all or any part of its property or assets, or enter into any sale-leaseback transactions, or purchase or other-wise acquire (in one or a series of related transactions) any part of the property or assets (other than purchases or other acquisitions of inventory, materials, equipment and intangible assets, including property acquired by way of trade or barter agreements, in the ordinary course of business) of any Person, except that: (i) Capital Expenditures made by the Borrower and its Subsidiaries shall be permitted to the extent not in violation of Section 9.07; (ii) each of the Borrower and its Subsidiaries may in the ordinary course of business, sell, lease or otherwise dispose of any assets provided that the aggregate Net Sale Proceeds of all assets subject to sales or other dispositions pursuant to this clause (ii) shall not exceed $2,500,000 in any fiscal year of the Borrower; (iii) investments may be made to the extent permitted by Section 9.05; (iv) each of the Borrower and its Subsidiaries may lease (as lessee) real or personal property in the ordinary course of business (so long as such lease does not create a Capitalized Lease Obligation not otherwise permitted by Section 9.04(v)); (v) each of the Borrower and its Subsidiaries may make sales or other transfers of airtime in the ordinary course of business and consistent with past practices; (vi) licenses or sublicenses by the Borrower and its Subsidiaries of software, trademarks and other intellectual property and general intangibles and licenses, leases or subleases of other property in the ordinary course of business and which do not materially interfere with the business of the Borrower or any Subsidiary; (vii) the Borrower or any Wholly-Owned Subsidiary of the Borrower may transfer assets to or lease assets to or acquire or lease assets from the -71- 79 Borrower or any Wholly-Owned Subsidiary (so long as the security interests granted pursuant to the Security Documents are not, in the judgment of the Collateral Agent, adversely affected thereby) or any Subsidiary of the Borrower may be merged or consolidated with or into, or be liquidated or dissolved into, the Borrower or any Wholly-Owned Subsidiary of the Borrower (so long as the Borrower or such Wholly-Owned Subsidiary is the surviving corporation); (viii) (x) the sale or other disposition of Stations of the Borrower or its Subsidiaries shall be permitted for cash at fair market value (as determined in good faith by the Borrower or its Subsidiaries) so long as the proceeds thereof are applied in accordance with Section 4.02(e), provided that the Broadcast Cash Flow attributable to the Stations so sold or disposed during any fiscal year of the Borrower or such Subsidiary shall not exceed 20% of Consolidated Broadcast Cash Flow for such fiscal year and (y) the acquisition for no more than fair market value of Reinvestment Assets shall be permitted in accordance with Sections 4.02(e) and 8.12; (ix) so long as (x) no Default or Event of Default then exists or would arise therefrom and (y) Holdings shall be in compliance with the financial covenants contained in Sections 9.08 through 9.10, inclusive, with such financial covenants to be calculated on a pro forma basis as if such Stock Swap and/or Station Swap had been consummated on the first day of the then most recently ended Test Period (and any Indebtedness incurred, issued or assumed in connection therewith had been incurred on the first day of, and remained outstanding throughout, such Test Period), the Borrower may, and may permit its Subsidiaries to, simultaneously exchange (for reasonably equivalent value, a portion thereof which may include cash) (x) 100% of the capital stock of any Subsidiary of such Person (the "Stock Swapped Station") for 100% of the capital stock of any Person (the "Stock Target Station") owning a station (each such occurrence a "Stock Swap") or (y) all or substantially all of the assets of a radio Station or group of Stations (the "Asset Swapped Station," with each Stock Swapped Station and Asset Swapped Station, a "Swapped Station") for all or substantially all of the assets of another radio station or group of stations (the "Asset Target Station," with each Stock Target Station and each Asset Target Station, a "Target Station") (each such occurrence a "Station Swap"), provided that at the time of such Stock Swap or Station Swap the Borrower and/or such Subsidiary, and the newly acquired entity, shall comply with Section 8.12, provided further, that any cash proceeds received by the Borrower or any of its Subsidiaries in connection with any such Station Swap shall be applied in accordance with the requirements of Section 4.02(e); (x) the Viacom Acquisition shall be permitted; -72- 80 (xi) the Borrower and its Subsidiaries may sell or discount, accounts receivable arising in the ordinary course of business (x) which are overdue or (y) which the Borrower may reasonably determine are difficult to collect, but only in connection with the compromise or collection thereof consistent with customary industry practice (and not as part of any bulk sale or financing of receivables); (xii) transfers of condemned property to the respective governmental authority or agency that have condemned same (whether by deed in lieu of condemnation or otherwise), and transfers of properties that have been subject to a casualty to the respective insurer of such property or its designee as part of an insurance settlement, so long as the proceeds thereof are applied as required by Section 4.02(g); (xiii) so long as no Default or Event of Default then exists or would arise therefrom, the Borrower may and may permit its Subsidiaries to, acquire the capital stock or assets of any Person so long as (x) any such acquisition is for all the capital stock or all or substantially all of the business of, or an operating division or a business unit of, such Person, (y) the aggregate consideration paid (including Indebtedness assumed in connection therewith) pursuant to this clause (xiii) does not exceed $200,000,000 and (z) Holdings shall be in compliance with the financial covenants contained in Sections 9.08 through 9.10, inclusive, with such financial covenants to be calculated on a pro forma basis as if such acquisition had been consummated on the first day of the then most recently ended Test Period (and any Indebtedness incurred, issued or assumed in connection therewith had been incurred on the first day of, and remained outstanding throughout, such Test Period); (xiv) in addition to the acquisitions permitted pursuant to preceding clause (xiii), the Borrower and its Subsidiaries may acquire all or substantially all of the business of, or operating division or a business unit of, any Person with the reinvestment of Excess Cash Flow for the relevant Excess Cash Payment Period to the extent, (w) not required to be applied to repay Loans pursuant to Section 4.02(f), (x) not used to prepay Holdings Subordinated Notes pursuant to Section 9.11 (ii), (y) not used to make Capital Expenditures pursuant to Section 9.07(c)(iii) and (z) not used to make investments pursuant to Section 9.05(x); (xv) the WDRQ Detroit Disposition shall be permitted; (xvi) the SFX Exchange shall be permitted; and -73- 81 (xvii) each of the Borrower and its Subsidiaries may sell or otherwise dispose of equipment in the ordinary course of business which, in the reasonable judgment of such Person, is obsolete, worn out or otherwise no longer useful, in the conduct of such Person's business. To the extent the Required Banks waive the provisions of this Section 9.02 with respect to the sale of any Collateral, or any Collateral is sold as permitted by this Section 9.02 (other than clause (vii) thereof), such Collateral shall be sold free and clear of the Liens created by the Security Documents, and the Managing Agent and Collateral Agent shall be authorized to take any actions deemed appropriate in order to effect the foregoing. 9.03 Dividends. Holdings shall not, and shall not permit any of its Subsidiaries to, authorize, declare or pay any Dividends with respect to Holdings or any of its Subsidiaries except that: (i) any Subsidiary of the Borrower may pay Dividends to the Borrower or any Wholly-Owned Subsidiary of the Borrower; (ii) the Borrower may pay cash Dividends to Holdings for the purpose of paying, so long as all proceeds thereof are promptly used by Holdings to pay, its operating expenses incurred in the ordinary course of business and other corporate overhead costs and expenses (including, without limitation, legal and accounting expenses and similar expenses) in a maximum principal amount of $2,000,000 per annum; (iii) Holdings may pay cash Dividends, and the Borrower may pay cash Dividends to Holdings to enable Holdings, to make payments (A) to pay management fees or executive compensation to the extent such management fees or executive compensation are permitted by Section 9.06(v) and (vi) and pursuant to the Monitoring and Oversight Agreements, to the extent permitted pursuant to Section 9.06(iv), (B) to repurchase Holdings Common Stock and/or options to purchase Holdings Common Stock held by (x) Dinetz pursuant to the Dinetz Employment Contract or (y) directors, executives, officers, members of management, or employees of Holdings, the Borrower or any of its Subsidiaries upon the exercise of options in accordance with the Employee Stock Option Plan, or (z) other stockholders of Holdings so long as the purpose of such purchase is to acquire Holdings Common Stock for reissuance to new employees of Holdings and its Subsidiaries to the extent so reissued within 12 months of any such purchase so long as the aggregate amount of cash expended by Holdings pursuant to subclause (B) of this clause (iii) shall not exceed $2,500,000 in any fiscal year or $5,000,000 in the aggregate (plus the amount of cash proceeds paid by any new employee in consideration for reissuance of -74- 82 Holdings Common Stock repurchased by Holdings to the extent received by Holdings within 12 months following any such repurchase, minus the amount of cash paid in respect of Holdings Subordinated Notes permitted under Section 9.11 (ii)) and (C) on the Holdings Subordinated Notes, to the extent permitted under Section 9.11 (ii), so long as in the case of subclauses (B) and (C) of this clause (iii), no Default or Event of Default exists or would result therefrom; (iv) the Borrower may pay cash Dividends to Holdings for the purpose of paying, so long as all proceeds thereof are promptly used by Holdings to pay franchise taxes and federal, state and local income taxes and interest, and penalties with respect thereto, if any, payable by Holdings, provided that any refund shall be promptly returned by Holdings to the Borrower; (v) the Borrower may pay cash Dividends to Holdings to enable Holdings to pay cash Dividends to redeem fractional shares of its common stock so long as the aggregate amount thereof does not exceed $5,000; (vi) the Borrower may pay regularly scheduled Dividends on its Exchangeable Preferred Stock pursuant to the terms thereof solely through the issuance of additional shares of Exchangeable Preferred Stock; (vii) so long as no Default or Event of Default then exists or would result therefrom, the Borrower may pay cash Dividends to Holdings for the purpose of paying, so long as all proceeds thereof are promptly used by Holdings to pay, regularly scheduled Dividends on its Convertible Preferred Stock; provided, that (x) the aggregate amount of cash Dividends paid pursuant to this clause (vii) shall not exceed 7% per annum of the original aggregate liquidation preference of the Convertible Preferred Stock in any fiscal year of the Borrower and (y) such payment of cash Dividends is permitted under the Series A Exchangeable Preferred Stock Documents, the Exchangeable Preferred Stock Documents and any other indenture, certificate of designation or other agreement which may restrict such payments; (viii) the Borrower may pay cash Dividends to Holdings for the purpose of making, so long as all proceeds thereof are promptly used by Holdings to make, cash payments in lieu of issuing fractional shares of Holdings Common Stock upon the conversion of the Convertible Preferred Stock in an aggregate amount not to exceed $150,000; -75- 83 (ix) the Borrower may pay cash Dividends on its Exchangeable Preferred Stock in lieu of issuing fractional shares of Exchangeable Preferred Stock; (x) so long as (x) no Default or Event of Default then exists or would result therefrom, (y) the Leverage Ratio on the date of payment thereof is less than 4.00: 1.00 and (z) such payment of cash Dividends is permitted under the indentures, certificates of designation and other agreements which may restrict such payments, the Borrower may pay regularly scheduled Dividends on its Series A Exchangeable Preferred Stock and Exchangeable Preferred Stock; and (xi) so long as no Default or Event of Default then exists or would result therefrom, the Borrower may pay cash Dividends to Holdings for the purpose of making, so long as all proceeds thereof are promptly used by Holdings to make, payments (including voluntary prepayments) in respect of principal and/or accrued interest under the Bridge Financing. 9.04 Indebtedness. Holdings will not, and will not permit any of its Subsidiaries to, contract, create, incur, assume or suffer to exist any Indebtedness, except: (i) Indebtedness incurred pursuant to this Agreement and the other Credit Documents; (ii) Indebtedness existing on the Second Restatement Effective Date shall be permitted to the extent the same is listed on Schedule VII, and extensions, replacements, refinancings or renewals thereof, provided that no such extension, replacement, refinancing or renewal shall increase the principal amount thereof; (iii) the Bridge Financing, but no extensions, replacements, refinancings or renewals thereof; (iv) Indebtedness under Interest Rate Protection Agreements to the extent entered into pursuant to Section 9.05(iv); (v) Indebtedness evidenced by Capitalized Lease Obligations to the extent permitted pursuant to Section 9.07; (vi) Indebtedness subject to Liens permitted under Section 9.01(viii); -76- 84 (vii) Indebtedness of Holdings not to exceed $2,500,000 at any time outstanding evidenced by subordinated notes in form and upon terms reasonably satisfactory to the Managing Agent (the "Holdings Subordinated Notes") issued to effectuate the stock repurchases described in Section 9.03(iii); (viii) Indebtedness (x) of the Borrower evidenced by the Existing Senior Subordinated Notes in an aggregate principal amount not to exceed $200,000,000, after giving effect to the Tender Offer and repurchase of such notes and (y) arising under guaranties by the Subsidiaries of the Borrower of the remaining obligations of the Borrower (if any) under the Existing Senior Subordinated Notes after giving effect to the Tender Offer and repurchase of such notes; (ix) additional Indebtedness of the Borrower and its Subsidiaries not otherwise permitted under this Section 9.04 not to exceed $5,000,000 in aggregate principal amount outstanding at any time; (x) Contingent Obligations of the Borrower or any Subsidiary as a guarantor of the lessee under any lease pursuant to which the Borrower or a Subsidiary is the lessee so long as such lease is otherwise permitted hereunder; (xi) intercompany Indebtedness of any Wholly-Owned Subsidiary of Holdings owing to the Borrower or any other Wholly-Owned Subsidiary of Holdings, or of the Borrower owing to any Wholly-Owned Subsidiary of Holdings, to the extent permitted by Section 9.05(xi); (xii) as long as no Default or Event of Default then exists or would arise therefrom, with the consent of the Total Supermajority Banks, the Borrower may exchange all of the Series A Exchangeable Preferred Stock into the 12-1/4% Junior Exchange Debentures in accordance with the terms of the Series A Exchangeable Preferred Stock Documents; (xiii) so long as no Default or Event of Default then exists or would arise therefrom, with the consent of the Total Supermajority Banks, the Borrower may exchange all of the Exchangeable Preferred Stock into the 12% Junior Exchange Debentures in accordance with the terms of the Exchangeable Preferred Stock Documents; (xiv) so long as (i) the Borrower shall have delivered a certificate of an Authorized Officer of the Borrower to the effect that, to the best of such officer's knowledge, (x) no Default or Event of Default has occurred and is continuing (or would result from the incurrence of the additional Indebtedness con- -77- 85 templated by this Section 9.04(xiv)), and (y) all representations and warranties herein or in any other Credit Document are true and correct in all material respects with the same effect as if these representations and warranties had been made on the date of the incurrence of Indebtedness contemplated by this Section 9.04(xiv) (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date) and (ii) new Notes and other documentation necessary to incur such Indebtedness are delivered in form and substance satisfactory to the Managing Agent pursuant to Sections 13.04 and 13.12, then the Borrower may, with the consent of the Banks providing such additional amount, increase the Total Revolving Loan Commitment by an amount not to exceed $100,000,000 in the aggregate; (xv) (A) unsecured Indebtedness of the Borrower and its Subsidiaries owing to the seller in any acquisition permitted pursuant to Sections 9.02(ix), (xiii) and (xiv) in an aggregate principal amount not to exceed $15,000,000 at any time outstanding or (B) Indebtedness of the Borrower and its Subsidiaries assumed in connection with any such acquisition of an asset securing such Indebtedness in an aggregate principal amount not to exceed $15,000,000 at any time outstanding, provided that such Indebtedness was not incurred in connection with, or in anticipation or contemplation of, such acquisition; (xvi) Contingent Obligations of the Borrower or any of its Subsidiaries (other than License Subsidiary) as a guarantor of Indebtedness permitted pursuant to Section 9.04(ii) existing on the Second Restatement Effective Date and extensions, replacements, refinancings and renewals thereof, provided that no such extension, replacement, refinancing or renewal shall (x) amend, modify or supplement the subordination provisions, if any, contained in such guaranty in a manner adverse to interests of the Banks or (y) increase the principal amount of such Indebtedness guaranteed by the original guaranty; (xvii) guarantees (other than guarantees of Indebtedness which is not a Capitalized Lease Obligation) made in the ordinary course of business, provided that such guarantees could not, individually or in the aggregate, have a material adverse effect on the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower or of Holdings and its Subsidiaries taken as a whole; and (xviii) Indebtedness of the Borrower evidenced by the 8-3/4% Senior Subordinated Notes in an aggregate principal amount not to exceed $200,000,000. -78- 86 Notwithstanding anything to the contrary contained in this Agreement, in no event shall the License Subsidiary contract, create, incur, assume or suffer to exist any Indebtedness (other than the Indebtedness incurred pursuant to the Subsidiary Guaranty). 9.05 Advances, Investments and Loans. Holdings will not, and will not permit any of its Subsidiaries to, directly or indirectly, lend money or credit or make advances to any Person, or purchase or acquire any stock, obligations or securities of, or any other interest in, or make any capital contribution to, any other Person, or purchase or own a futures contract or otherwise become liable for the purchase or sale of currency or other commodities at a future date in the nature of a futures contract, or hold any cash or Cash Equivalents, except that the following shall be permitted: (i) the Borrower and its Subsidiaries may acquire and hold accounts receivables owing to any of them, if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary terms; (ii) the Borrower and its Subsidiaries may acquire and hold cash and Cash Equivalents, provided that during any time that Revolving Loans of Non-Defaulting Banks are outstanding, the aggregate amount of cash and Cash Equivalents permitted to be held by the Borrower and its Subsidiaries shall not exceed $5,000,000 for any period of five consecutive days (exclusive of any cash held by the Borrower pursuant to an earnest money escrow account to the extent such account is permitted by Section 9.01(xix); (iii) the Borrower and its Subsidiaries may make loans and advances in the ordinary course of business to their respective officers, directors and employees so long as the aggregate principal amount thereof at any time outstanding (determined without regard to any write-downs or write-offs of such loans and advances) shall not exceed $1,000,000; (iv) the Borrower may enter into Interest Protection Agreements on terms reasonably satisfactory to the Managing Agent; (v) Holdings may repurchase Holdings Common Stock to the extent permitted by Section 9.03; (vi) Holdings and any of its Subsidiaries may make investments in accordance with Section 4.02(e) (including investments necessary to form Subsidiaries under Section 9.15); -79- 87 (vii) promissory notes and other similar non-cash consideration received by the Borrower and its Subsidiaries in connection with dispositions permitted by Section 9.02 so long as the aggregate principal amount thereof does not exceed $1,000,000 at any one time outstanding; (viii) the Borrower and its Subsidiaries may acquire and own investments (including debt obligations) received in connection with the bankruptcy or reorganization of suppliers and customers and in settlement of delinquent obligations of, and other disputes with, customers and suppliers arising in the ordinary course of business; (ix) investments by the Borrower in any Wholly-Owned Subsidiary; (x) investments by the Borrower and its Subsidiaries consisting of the reinvestment of Excess Cash Flow for the relevant Excess Cash Payment Period to the extent (v) not required to be applied to repay the Loans pursuant to Section 4.02(f), (w) not used to prepay Holdings Subordinated Notes pursuant to Section 9.11 (ii), (x) not used to make Capital Expenditures pursuant to Section 9.07(c)(iii), (y) not used to make acquisitions pursuant to Section 9.02(xiv) and (z) such investments (other than investments resulting in the ownership by the Borrower and/or its Subsidiaries of 100% of the capital stock of the Person in which such investment is made) in an aggregate principal amount not to exceed $10,000,000; (xi) any Wholly-Owned Subsidiary may make intercompany loans and advances to the Borrower or any Wholly-Owned Subsidiary and the Borrower may make intercompany loans and advances to any Wholly-Owned Subsidiary, provided that if such intercompany loans are evidenced by an intercompany promissory note, such note is pledged by the Borrower or such Wholly-Owned Subsidiary as Collateral pursuant to the applicable Pledge Agreement; (xii) investments by the Borrower or any of its Subsidiaries to the extent permitted by Section 9.07; (xiii) advances, loans and investments made by the Borrower and its Subsidiaries in existence on the Second Restatement Effective Date and set forth on Schedule VIII shall be permitted, without giving effect to any additions thereto or replacements thereof; (xiv) guarantees of Indebtedness made by the Borrower or any of its Subsidiaries to the extent otherwise permitted by Section 9.04; and -80- 88 (xv) in addition to investments permitted by clauses (i) through (xiv) of this Section 9.05, the Borrower and its Subsidiaries may make additional loans, advances and investments in an aggregate principal amount not to exceed $2,500,000 at any time outstanding. 9.06 Transactions with Affiliates. Holdings will not, and will not permit any of its Subsidiaries to enter into any transaction or series of related transactions, whether or not in the ordinary course of business, with any Affiliate of Holdings or any of its Subsidiaries, other than in the ordinary course of business and on terms and conditions substantially as favorable to Holdings or such Subsidiary as would reasonably be obtained by Holdings or such Subsidiary at that time in a comparable arm's-length transaction with a Person other than an Affiliate, except that: (i) Dividends may be paid to the extent provided in Section 9.03; (ii) loans may be made and other transactions may be entered into by the Borrower and its Subsidiaries to the extent permitted by Sections 9.02, 9.04 and 9.05; (iii) customary fees and reimbursement of expenses may be paid to directors of Holdings; (iv) Holdings or to the extent not paid by Holdings, the Borrower may pay to Hicks, Muse & Co. Partners, L.P., its Affiliates or any successor thereto controlled by Jack D. Furst, Charles W. Tate, Thomas O. Hicks and/or John R. Muse, the amounts set forth in the Amended and Restated Financial Monitoring and Oversight Agreement dated as of January 1, 1996, among Holdings, the Borrower and Hicks, Muse & Co. Partners, L.P. and the Financial Advisory Agreement (together with the Amended and Restated Financial Monitoring and Oversight Agreement, the "Monitoring and Oversight Agreements") dated as of January 1, 1996 among HM2/Management Partners L.P., the Company and Holdings in the form delivered to the Banks on or prior to the Second Restatement Effective Date, as it may be modified thereafter but without giving effect to any modifications thereto which in any way adversely affects the interests of the Banks without the consent of the Managing Agent and the Required Banks; provided that, notwithstanding anything to the contrary above in this clause (iv), the Amended and Restated Financial Monitoring and Oversight Agreement may be amended to increase the base fee paid to Hicks, Muse & Co. Partners, L.P. to an amount not to exceed $1,000,000 without obtaining the consent of the Managing Agent or the Required Banks; -81- 89 (v) Holdings and its Subsidiaries may enter into and make payments pursuant to employment arrangements with executive officers and senior management employees in the ordinary course of business and may enter into employment termination agreements in connection with the Viacom Acquisition and the Evergreen Merger; (vi) Holdings and its Subsidiaries may make payments pursuant to employment agreements existing on the Second Restatement Effective Date; (vii) Holdings and its Subsidiaries may make payments pursuant to the Tax Sharing Agreements; (viii) the Borrower and the License Subsidiary may maintain their present Operating Agreements; and (ix) Holdings may make capital contributions to the Borrower. Except as specifically provided above, no management or similar fees shall be paid or payable by Holdings or any of its Subsidiaries to any Person other than the Borrower. 9.07 Capital Expenditures. (a) Holdings will not, and will not permit any of its Subsidiaries to, make any Capital Expenditures, except that during any fiscal period set forth below (taken as one accounting period) the Borrower and its Subsidiaries may make Capital Expenditures so long as the aggregate amount of such Capital Expenditures made under this Section 9.07(a) does not exceed in any period set forth below the amount set forth opposite such period below:
Period Amount ------ ------ Second Restatement Effective Date to $3,500,000 and including the last day of the Fiscal Year ending December 31, 1997 Fiscal Year ending $7,500,000 December 31, 1998 Fiscal Year ending $8,000,000 December 31, 1999 Fiscal Year ending $8,000,000 December 31, 2000
-82- 90 Fiscal Year ending $8,500,000 December 31, 2001 Fiscal Year ending $9,000,000 December 31, 2002 Fiscal Year ending $9,000,000 December 31, 2003 January 1, 2004 to and $9,000,000 including the Maturity Date.
(b) Notwithstanding anything to the contrary contained in clause (a) above, to the extent that the Capital Expenditures made by the Borrower and its Subsidiaries (i) in any period set forth in clause (a) above are less than the amount permitted to be made in such period (without giving effect to any additional amount available as a result of this clause (b) or clause (c) below), the amount of such difference may be carried forward and used to make Capital Expenditures in the immediately succeeding fiscal year of the Borrower or (ii) from January 1, 1997 to and including the Second Restatement Effective Date are less than $3,000,000, the amount of such difference may be carried forward and used to make Capital Expenditures in the period from the Second Restatement Effective Date to and including the last day of the fiscal year ending December 31, 1997, with such carried forward amount to be pooled with permitted expenditures for such fiscal year ending December 31, 1997 for purposes of calculating carry over amounts into the fiscal year ending December 31, 1998. (c) In addition to the Capital Expenditures permitted pursuant to preceding clauses (a) and (b), the Borrower and its Subsidiaries may make additional Capital Expenditures consisting of (i) the reinvestment of Net Sale Proceeds of asset sales not required to be applied to prepay the Loans pursuant to Section 4.02(e) as a result of the first proviso contained therein, (ii) the reinvestment of proceeds of Recovery Events not required to be applied to repay the Loans pursuant to Section 4.02(g) and (iii) the reinvestment of the amounts of Excess Cash Flow (w) not required to be applied to repay the Loans pursuant to Section 4.02(f), (x) not used to prepay the Holdings Subordinated Notes pursuant to Section 9.11(ii), (y) not used to make acquisitions pursuant to Section 9.02(xiv) or (z) not used to make investments pursuant to Section 9.05(x). -83- 91 9.08 Maximum Leverage Ratio. Holdings will not permit the Leverage Ratio at any time during a period set forth below to be greater than the ratio set forth opposite such period below:
Period Ratio ------ ----- Fiscal quarter ended June 30, 1997 7.00:1.00 Fiscal quarter ended September 30, 1997 7.00:1.00 Fiscal quarter ended December 31, 1997 7.00:1.00 Fiscal quarter ended March 31, 1998 7.00:1.00 Fiscal quarter ended June 30, 1998 7.00:1.00 Fiscal quarter ended September 30, 1998 6.80:1.00 Fiscal quarter ended December 31, 1998 6.75:1.00 Fiscal quarter ended March 31, 1999 6.50:1.00 Fiscal quarter ended June 30, 1999 6.25:1.00 Fiscal quarter ended September 30, 1999 6.00:1.00 Fiscal quarter ended December 31, 1999 5.75:1.00 Fiscal quarter ended March 31, 2000 5.50:1.00 Fiscal quarter ended June 30, 2000 5.25:1.00 Fiscal quarter ended September 30, 2000 5.00:1.00 Fiscal quarter ended December 31, 2000 4.80:1.00 Fiscal quarter ended March 31, 2001 4.60:1.00 Fiscal quarter ended June 30, 2001 4.50:1.00 Fiscal quarter ended September 30, 2001 4.25:1.00 Fiscal quarter ended December 31, 2001 4.00:1.00 Fiscal quarter ended March 31, 2002 4.00:1.00 Fiscal quarter ended June 30, 2002 3.75:1.00 Fiscal quarter ended September 30, 2002 3.75:1.00 Fiscal quarter ended December 31, 2002 3.50:1.00 Fiscal quarter ended March 31, 2003 3.50:1.00 Fiscal quarter ended June 30, 2003 3.50:1.00 Fiscal quarter ended September 30, 2003 3.50:1.00 Fiscal quarter ended December 31, 2003 3.50:1.00 Fiscal quarter ended March 31, 2004 3.50:1.00
-84- 92 9.09 Minimum Consolidated EBITDA. Holdings will not permit Consolidated EBITDA for any period of four consecutive fiscal quarters (or, if shorter, the period beginning on the Second Restatement Effective Date and ending on the last day of a fiscal quarter ended thereafter), in each case taken as one accounting period, ended on the last day of any fiscal quarter set forth below to be less than the amount set forth opposite such fiscal quarter below:
Fiscal Quarter Amount -------------- ------ Fiscal quarter ended September 30, 1997 $ 31,000,000 Fiscal quarter ended December 31, 1997 $ 68,400,000 Fiscal quarter ended March 31, 1998 $ 95,000,000 Fiscal quarter ended June 30, 1998 $128,300,000 Fiscal quarter ended September 30, 1998 $130,400,000 Fiscal quarter ended December 31, 1998 $133,100,000 Fiscal quarter ended March 31, 1999 $135,300,000 Fiscal quarter ended June 30, 1999 $138,100,000 Fiscal quarter ended September 30, 1999 $140,800,000 Fiscal quarter ended December 31, 1999 $144,200,000 Fiscal quarter ended March 31, 2000 $146,600,000 Fiscal quarter ended June 30, 2000 $149,700,000 Fiscal quarter ended September 30, 2000 $152,800,000 Fiscal quarter ended December 31, 2000 $156,400,000 Fiscal quarter ended March 31, 2001 $159,100,000 Fiscal quarter ended June 30, 2001 $162,300,000 Fiscal quarter ended September 30, 2001 $165,600,000 Fiscal quarter ended December 31, 2001 $169,500,000 Fiscal quarter ended March 31, 2002 $172,200,000 Fiscal quarter ended June 30, 2002 $175,400,000 Fiscal quarter ended September 30, 2002 $178,700,000 Fiscal quarter ended December 31, 2002 $182,700,000 Fiscal quarter ended March 31, 2003 $185,500,000 Fiscal quarter ended June 30, 2003 $189,100,000 Fiscal quarter ended September 30, 2003 $192,600,000 Fiscal quarter ended December 31, 2003 $196,900,000 Fiscal quarter ended March 31, 2004 $199,100,000
-85- 93 9.10 Consolidated EBITDA to Consolidated Net Cash Interest Expense. Holdings will not permit the ratio of Consolidated EBITDA to Consolidated Net Cash Interest Expense for any period of four consecutive fiscal quarters (or, if shorter, the period beginning on the Second Restatement Effective Date and ending on the last day of a fiscal quarter ended thereafter), in each case taken as one accounting period, ended on the last day of any fiscal quarter set forth below to be less than the amount set forth opposite such fiscal quarter below:
Fiscal Quarter Ratio -------------- ----- Fiscal quarter ended September 30, 1997 1.75:1.00 Fiscal quarter ended December 31, 1997 1.75:1.00 Fiscal quarter ended March 31, 1998 1.75:1.00 Fiscal quarter ended June 30, 1998 1.75:1.00 Fiscal quarter ended September 30, 1998 1.75:1.00 Fiscal quarter ended December 31, 1998 1.75:1.00 Fiscal quarter ended March 31, 1999 1.75:1.00 Fiscal quarter ended June 30, 1999 1.80:1.00 Fiscal quarter ended September 30, 1999 1.80:1.00 Fiscal quarter ended December 31, 1999 1.85:1.00 Fiscal quarter ended March 31, 2000 2.00:1.00 Fiscal quarter ended June 30, 2000 2.10:1.00 Fiscal quarter ended September 30, 2000 2.20:1.00 Fiscal quarter ended December 31, 2000 2.30:1.00 Fiscal quarter ended March 31, 2001 2.40:1.00 Fiscal quarter ended June 30, 2001 2.50:1.00 Fiscal quarter ended September 30, 2001 2.65:1.00 Fiscal quarter ended December 31, 2001 2.75:1.00 Fiscal quarter ended March 31, 2002 2.90:1.00 Fiscal quarter ended June 30, 2002 3.00:1.00 Fiscal quarter ended September 30, 2002 3.00:1.00 Fiscal quarter ended December 31, 2002 3.00:1.00 Fiscal quarter ended March 31, 2003 3.00:1.00 Fiscal quarter ended June 30, 2003 3.00:1.00
-86- 94 Fiscal quarter ended September 30, 2003 3.00:1.00 Fiscal quarter ended December 31, 2003 3.00:1.00 Fiscal quarter ended March 31, 2004 3.00:1.00
9.11 Limitation on Modifications of Certificate of Incorporation, ByLaws and Certain Other Agreements; Limitations of Prepayments and Modifications of Indebtedness; etc. Holdings will not, and will not permit any of its Subsidiaries to (i) make (or give any notice with respect of) any voluntary or optional payment or prepayment on or redemption or acquisition for value of (including, without limitation, by way of depositing with the trustee with respect thereto money or securities before due for the purpose of paying when due), after the issuance thereof, any 12-1/4% Junior Exchange Debentures, 12% Junior Exchange Debentures, the Bridge Financing (except such payments in respect of principal of and accrued interest on the Bridge Financing as are permitted by Section 9.03(xi)), the 8-3/4% Senior Subordinated Notes or any Existing Senior Subordinated Notes (after giving effect to the Tender Offer), (ii) make any cash payments whatsoever in respect of Holdings Subordinated Notes issued pursuant to Section 9.04(vii) unless the aggregate amount of such payments made in respect of such Holdings Subordinated Notes, when added to the aggregate amount of Dividends theretofore paid pursuant to Section 9.03(iii)(B), do not exceed $2,500,000 in any fiscal year or $5,000,000 in the aggregate (plus the amount of cash proceeds paid by any new employee in consideration for reissuance of Holdings Common Stock repurchased by Holdings to the extent received by Holdings within six months following any such repurchase), (iii) amend or modify, or permit the amendment or modification of any provision of the foregoing Indebtedness (including, without limitation, the Supplemental Indenture), the Series A Exchangeable Preferred Stock Documents (including as relating to the 12-1/4% Junior Exchange Debentures), the Exchangeable Preferred Stock Documents (including as relating to the 12% Junior Exchange Debentures), the 8-3/4% Senior Subordinated Note Documents, the Bridge Financing Documents, the Tax Sharing Agreement, the Viacom Joint Purchase Agreement, the SFX Exchange Documents, (other than, in the case of the Tax Sharing Agreement, the Viacom Joint Purchase Agreement, the SFX Exchange Documents or the WDRQ Detroit Disposition Documents, in a manner not reasonably likely to be materially adverse to the interest of the Banks) or (iv) amend, modify or change its Certificate of Incorporation (including, without limitation, by the filing or modification of any certificate of designation) or By-Laws, or any agreement entered into by it, as the case may be, with respect to its capital stock (including any Stockholders' Agreement), or enter into any new agreement with respect to its capital stock, other than any amendments, modifications or changes pursuant to this clause or any such new agreements which do not in any way adversely affect the interests of the Banks. -87- 95 9.12 Limitation on Certain Restrictions on Subsidiaries. Holdings will not, and will not permit any of its Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any encumbrance or restriction on the ability of any such Subsidiary to (a) pay dividends or make any other distributions on its capital stock or any other interest or participation in its profits owned by the Borrower or any Subsidiary of the Borrower, or pay any Indebtedness owed to the Borrower or any Subsidiary of the Borrower, (b) make loans or advances to the Borrower or any Subsidiary of the Borrower or (c) transfer any of its properties or assets to the Borrower or any Subsidiary of the Borrower, except for such encumbrances or restrictions existing under or by reason of (i) applicable law, (ii) this Agreement, the other Credit Documents, the Bridge Financing Documents, and the Viacom Acquisition Documents, (iii) customary provisions restricting subletting or assignment of any lease governing a leasehold interest of the Borrower or any Subsidiary of the Borrower, (iv) customary provisions restricting assignment of any licensing agreement entered into by the Borrower or any Subsidiary of the Borrower in the ordinary course of business and (v) customary restrictions in any industrial revenue bond, purchase money financing, capital lease or any other agreement permitted by this Agreement. 9.13 Limitation on Issuance of Capital Stock. (a) Holdings will not issue (i) any preferred stock or (ii) any class of redeemable common stock, other than Permitted Issuances. (b) The Borrower will not issue, or permit any of its Subsidiaries to issue, any capital stock (including by way of sales of treasury stock) or any options or warrants to purchase, or securities convertible into, capital stock, except (i) for transfers and replacements of then outstanding shares of capital stock, (ii) for stock splits, stock dividends and similar issuances which do not decrease the percentage ownership of Holdings or any of its Subsidiaries in any class of the capital stock of the Borrower or such Subsidiary, (iii) to qualify directors to the extent required by applicable law, (iv) the Borrower may issue additional shares of common stock to Holdings, so long as all such shares are immediately delivered to the Collateral Agent and pledged pursuant to the Amended and Restated Holdings Pledge Agreement, (v) Series A Exchangeable Preferred Stock, provided that the Borrower may not exchange the Series A Exchangeable Preferred Stock for 12-1/4% Junior Exchange Debentures other than in accordance with Section 9.04(xii), (vi) Exchangeable Preferred Stock, provided that the Borrower may not exchange the Exchangeable Preferred Stock for 12% Junior Exchange Debentures other than in accordance with Section 9.04(xiii), and (vii) in connection with the creation of Subsidiaries of the Borrower in compliance with Section 9.15. 9.14 Business. (a) Holdings shall engage in no types of business and shall have no assets or liabilities, other than its ownership of the capital stock of the -88- 96 Borrower and liabilities incident thereto, and liabilities expressly permitted under this Agreement. (b) The Borrower will not, and will not permit any of its Subsidiaries to, engage (directly or indirectly) in any business other than the type of business in which the Borrower and its Subsidiaries are engaged on the Second Restatement Effective Date and reasonable extensions thereof. (c) Chancellor Broadcasting Licensee shall engage in no business activities and have no assets or liabilities, other than the holding of certain of the FCC Licenses and its operations pursuant to Operating Agreements with the Borrower and liabilities incident thereto. 9.15 Limitation on Creation of Subsidiaries. Holdings shall not and will not permit any Subsidiary to establish, create or acquire any additional Subsidiaries after the Second Restatement Effective Date without the prior written consent of the Required Banks, except that the Borrower may create or otherwise acquire new Subsidiaries in connection with the acquisition of Stations in compliance with Sections 4.02(e), 9.02(ix), 9.02(xiii), 9.02(xiv), 9.05(x) or 9.05(xii). 9.16 No Other Designated Senior Debt. Holdings will not, and will not permit any Subsidiary to, create or permit the creation after the Second Restatement Effective Date of, any class of "Designated Senior Debt," or any Indebtedness with similar rights, including pursuant to clause (ii) of the definition of "Designated Senior Debt" appearing in the Second Senior Subordinated Note Indenture, the 12-1/4% Junior Exchange Debenture Indenture or the 12% Junior Exchangeable Debenture Indenture. SECTION 10. Events of Default. Upon the occurrence of any of the following specified events (each an "Event of Default"): 10.01 Payments. The Borrower shall (i) default in the payment when due of any principal of any Loan or any Note or (ii) default, and such default shall continue unremedied for three or more Business Days, in the payment when due of any Unpaid Drawings or interest on any Loan or Note, or any Fees or any other amounts owing hereunder, thereunder or under any other Credit Document; or 10.02 Representations, etc. Any representation, warranty or statement made by any Credit Party herein or in any other Credit Document or in any certificate delivered pursuant hereto or thereto shall prove to be untrue in any material respect on the date as of which made or deemed made; or -89- 97 10.03 Covenants. Holdings or the Borrower shall (i) default in the due performance or observance by it of any term, covenant or agreement contained in Section 8.01(g)(i), 8.07, 8.11, 8.12(d), 8.13 or Section 9 or (ii) default in the due performance or observance by it of any other term, covenant or agreement contained in this Agreement (other than as described in Section 10.01, 10.02 or 10.03(i)), and such default shall continue unremedied for a period of 30 days after written notice to the Borrower by the Managing Agent or any Bank; or 10.04 Default Under Other Agreements. Holdings or any of its Subsidiaries shall (i) default in any payment of any Indebtedness (other than the Obligations) beyond the period of grace, if any, provided in the instrument or agreement under which such Indebtedness was created or (ii) default in the observance or performance of any agreement or condition relating to any Indebtedness (other than the Obligations) or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause (determined without regard to whether any notice is required), any such Indebtedness to become due prior to its stated maturity, or (iii) any Indebtedness (other than the Obligations) of Holdings or any of its Subsidiaries shall be declared to be due and payable, or required to be prepaid other than by a regularly scheduled required prepayment, prior to the stated maturity thereof, provided that (x) it shall not be a Default or Event of Default under this Section 10.04 unless the aggregate principal amount of all Indebtedness as described in preceding clauses (i) through (iii), inclusive, is at least $1,500,000; or 10.05 Bankruptcy, etc. Holdings or any of its Subsidiaries shall commence a voluntary case concerning itself under Title II of the United States Code entitled "Bankruptcy," as now or hereafter in effect, or any successor thereto (the "Bankruptcy Code"); or an involuntary case is commenced against Holdings or any of its Subsidiaries and the petition is not controverted within 10 days, or is not dismissed within 60 days, after commencement of the case; or a custodian (as defined in the Bankruptcy Code) is appointed for, or takes charge of, all or substantially all of the property of Holdings or any of its Subsidiaries, or Holdings or any of its Subsidiaries commences any other proceeding under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction whether now or hereafter in effect relating to Holdings or any of its Subsidiaries, or there is commenced against Holdings or any of its Subsidiaries any such proceeding which remains undismissed for a period of 60 days, or Holdings or any of its Subsidiaries is adjudicated insolvent or bankrupt; or any order of relief or other order approving any such case or proceeding is entered; or Holdings or any of its Subsidiaries suffers any appointment of any custodian or the like for it or any substantial part of its property to continue undischarged or unstayed for a period of 60 days; -90- 98 or Holdings or any of its Subsidiaries makes a general assignment for the benefit of creditors; or any corporate action is taken by Holdings or any of its Subsidiaries for the purpose of effecting any of the foregoing; or 10.06 ERISA. (a) Any Plan shall fail to satisfy the minimum funding standard required for any plan year or part thereof or a waiver of such standard or extension of any amortization period is sought or granted under Section 412 of the Code, any Plan shall have had or, in the reasonable opinion of the Required Banks, is likely to have a trustee appointed to administer such Plan, any Plan is, shall have been or is likely to be terminated or to be the subject of termination proceedings under ERISA, any Plan shall have an Unfunded Current Liability, a contribution required to be made to a Plan has not been made, Holdings, the Borrower or any of their respective Subsidiaries or any ERISA Affiliate has incurred or is likely to incur a liability to or on account of a Plan under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the Code, or Holdings, the Borrower or any of their respective Subsidiaries has incurred or is likely to incur liabilities pursuant to one or more employee welfare benefit plans (as defined in Section 3(l) of ERISA) which provide benefits to retired employees or other former employees (other than as required by Section 601 of ERISA) or employee pension benefit plans (as defined in Section 3(2) of ERISA); (b) there shall result from any such event or events the imposition of a lien, the granting of a security interest, or a liability or a material risk of incurring a liability; and in each case in clauses (a) and (b) above, such lien, security interest or liability, in the reasonable opinion of the Required Banks, will have a material adverse effect upon the business, operations, property, assets, liabilities or condition (financial or otherwise) of Holdings, the Borrower or of Holdings and its Subsidiaries taken as a whole; or 10.07 Security Documents. At any time after the execution and delivery thereof, any of the Security Documents shall cease to be in full force and effect, or shall cease in any material respect to give the Collateral Agent for the benefit of the Secured Creditors the Liens, rights, powers and privileges purported to be created thereby (including, without limitation, a perfected security interest in, and Lien on, all of the Collateral), in favor of the Collateral Agent, superior to and prior to the rights of all third Persons (except as permitted by Section 9.01), and subject to no other Liens (except as permitted by Section 9.01), or any Credit Party shall default in the due performance or observance of any term, covenant or agreement on its part to be performed or observed pursuant to any of the Security Documents and such default shall continue beyond any grace period specifically applicable thereto pursuant to the terms of such Security Document; or 10.08 Guaranty. Any Guaranty or any provision thereof shall cease to be in full force or effect as to the relevant Guarantor or other party thereunder (other -91- 99 than in accordance with the express terms thereof) or any Guarantor or other party thereunder or Person acting by or on behalf of such Guarantor or such party shall deny or disaffirm such Guarantor's or such party's obligations under the relevant Guaranty, or any Guarantor or such party shall default in the due performance or observance of any term, covenant or agreement on its part to be performed or observed pursuant to any Guaranty; or 10.09 Judgments. One or more judgments or decrees shall be entered against Holdings or any of its Subsidiaries involving in the aggregate for Holdings and its Subsidiaries a liability (not paid or fully covered by a reputable and solvent insurance company) and such judgments and decrees either shall be final and non-appealable or shall not be vacated, discharged or stayed or bonded pending appeal for any period of 60 consecutive days, and the aggregate amount of all such judgments exceeds $2,000,000; or 10.10 Change of Ownership. A Change of Ownership shall occur; or 10.11 Environmental Matters. At any time after the Second Restatement Effective Date, the Amended and Restated Environmental Indemnity Agreement or any provision thereof, or the Environmental Indemnity Agreement or any provision thereof, shall cease to be in full force or effect as to Holdings or any of its Subsidiaries, as applicable, or Holdings or any of its Subsidiaries shall default in the due performance or observance of any term, covenant or agreement on its part to be performed or observed pursuant to the Amended and Restated Environmental Indemnity Agreement or the Environmental Indemnity Agreement, as applicable, and such default shall continue unremedied for a period of 30 days after written notice to the Borrower by the Managing Agent or any Bank; then, and in any such event, and at any time thereafter, if any Event of Default shall then be continuing, the Managing Agent, upon the written request of the Required Banks, shall by written notice to the Borrower, take any or all of the following actions, without prejudice to the rights of the Managing Agent, any Bank or the holder of any Note to enforce its claims against any Credit Party (provided that, if an Event of Default specified in Section 10.05 shall occur with respect to the Borrower, the result which would occur upon the giving of written notice by the Managing Agent to the Borrower as specified in clauses (i) and (ii) below shall occur automatically without the giving of any such notice): (i) declare the Total Commitments terminated, whereupon all Commitments of each Bank shall forthwith terminate immediately and any Commitment Commission shall forthwith become due and payable without any other notice of any kind; (ii) declare the principal of and any accrued interest in respect of all Loans and the Notes and all Obligations owing hereunder and thereunder to be, whereupon the same shall become, forthwith due and payable without presentment, demand, protest -92- 100 or other notice of any kind, all of which are hereby waived by each Credit Party; (iii) terminate any Letter of Credit which may be terminated in accordance with its terms; (iv) direct the Borrower to pay (and the Borrower agrees that upon receipt of such notice, or upon the occurrence of an Event of Default specified in Section 10.05 with respect to the Borrower, it will pay) to the Collateral Agent at the Payment Office such additional amount of cash, to be held as security by the Collateral Agent, as is equal to the aggregate Stated Amount of all Letters of Credit issued for the account of the Borrower and then outstanding; (v) enforce, as Collateral Agent, all of the Liens and security interests created pursuant to the Security Documents and (vi) apply any cash collateral held pursuant to Section 4.02 in satisfaction of the Obligations. SECTION 11. Definitions and Accounting Terms. 11.01 Defined Terms. As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined): "ABC" shall mean ABC, Inc., a New York corporation. "Acquired Viacom Stations" shall mean the stations acquired by the Borrower from Viacom pursuant to the Viacom Joint Purchase Agreement, including KYSR-FM, KIBB-FM, WLIT-FM and WDRQ-FM. "Acknowledgment, Consent and Amendment" shall have the meaning provided in Section 5.17. "Acquired Viacom Subsidiaries" shall mean KIBB, KYSR, WDRQ and WLIT, each a Subsidiary of Viacom, which collectively own the Acquired Viacom Stations. "Additional Collateral" shall mean all property (whether real or personal) in which security interests are granted (or have been purported to be granted) (and continue to be in effect at the time of determination) pursuant to Section 8.12 (which shall in any event exclude any interest in the FCC Licenses to the extent prohibited by applicable law). "Additional Mortgage" shall have the meaning provided in Section 8.12(b). "Additional Mortgaged Property" shall have the meaning provided in Section 8.12(b). -93- 101 "Additional Security Documents" shall mean all mortgages, pledge agreements, security agreements and other security documents entered into pursuant to Section 8.12 with respect to Additional Collateral. "Adjusted Certificate of Deposit Rate" shall mean, on any day, the sum (rounded to the nearest 1/100 of 1%) of (1) the rate obtained by dividing (x) the most recent weekly average dealer offering rate for negotiable certificates of deposit with a three-month maturity in the secondary market as published in the most recent Federal Reserve System publication entitled "Select Interest Rates," published weekly on Form H.15 as of the date hereof, or if such publication or a substitute containing the foregoing rate information shall not be published by the Federal Reserve System for any week, the weekly average offering rate determined by the Managing Agent on the basis of quotations for such certificates received by it from three certificate of deposit dealers in New York of recognized standing or, if such quotations are unavailable, then on the basis of other sources reasonably selected by the Managing Agent, by (y) a percentage equal to 100% minus the stated maximum rate of all reserve requirements as specified in Regulation D applicable on such day to a three-month certificate of deposit of a member bank of the Federal Reserve System in excess of $100,000 (including, without limitation, any marginal, emergency, supplemental, special or other reserves), plus (2) the then daily net annual assessment rate as estimated by the Managing Agent for determining the current annual assessment payable by the Managing Agent to the Federal Deposit Insurance Corporation for insuring three-month certificates of deposit. "Adjusted Consolidated Net Income" for any period shall mean Consolidated Net Income for such period plus, without duplication, the sum of the amount of all net non-cash charges (including, without limitation, depreciation, amortization, deferred tax expense and non-cash interest expense, but excluding any net non-cash charges reflected in Adjusted Consolidated Working Capital) and net non-cash losses which were included in arriving at Consolidated Net Income for such period less the sum of the amount of all net non-cash gains (exclusive of such non-cash items reflected in Adjusted Consolidated Working Capital) included in arriving at Consolidated Net Income for such period. "Adjusted Consolidated Working Capital" at any time shall mean Consolidated Current Assets (but excluding therefrom all cash and Cash Equivalents) less Consolidated Current Liabilities. "Adjusted RL Percentage" shall mean (x) at a time when no Bank Default exists, for each Bank, such Bank's RL Percentage and (y) at a time when a Bank Default exists (i) for each Bank that is a Defaulting Bank, zero and (ii) for each Bank that is a Non-Defaulting Bank, the percentage determined by dividing in the case of such Bank's RL Percentage, such Bank's Revolving Loan Commitment at such time by -94- 102 the Adjusted Total Revolving Loan Commitment at such time, it being understood that all references herein to Revolving Loan Commitments and the Adjusted Total Revolving Loan Commitment at a time when the Total Revolving Loan Commitment or Adjusted Total Revolving Loan Commitment, as the case may be, has been terminated shall be references to the Revolving Loan Commitments or Adjusted Total Revolving Loan Commitment, as the case may be, in effect immediately prior to such termination, provided that (A) no Bank's Adjusted RL Percentage shall change upon the occurrence of a Bank Default from that in effect immediately prior to such Bank Default if after giving effect to such Bank Default, and any repayment of Revolving Loans at such time pursuant to Section 4.02(a) or otherwise, the sum of the aggregate outstanding principal amount of Revolving Loans of all Non-Defaulting Banks plus the Letter of Credit Outstandings, exceed the Adjusted Total Revolving Loan Commitment; (B) the changes to the Adjusted RL Percentage that would have become effective upon the occurrence of a Bank Default but that did not become effective as a result of the preceding clause (A) shall become effective on the first date after the occurrence of the relevant Bank Default on which the sum of the aggregate outstanding principal amount of the Revolving Loans of all Non-Defaulting Banks plus the Letter of Credit Outstandings is equal to or less than the Adjusted Total Revolving Loan Commitment; and (C) if (i) a Non-Defaulting Bank's Adjusted RL Percentage is changed pursuant to the preceding clause (B) and (ii) any repayment of such Bank's Revolving Loans, or of Unpaid Drawings with respect to Letters of Credit, that were made during the period commencing after the date of the relevant Bank Default and ending on the date of such change to its Adjusted RL Percentage. must be returned to the Borrower as a preferential or similar payment in any bankruptcy or similar proceeding of the Borrower, then the change to such Non-Defaulting Bank's Adjusted RL Percentage effected pursuant to said clause (B) shall be reduced to that positive change, if any, as would have been made to its Adjusted RL Percentage if (x) such repayments had not been made and (y) the maximum change to its Adjusted RL Percentage would have resulted in the sum of the outstanding principal of Revolving Loans made by such Bank plus such Bank's new Adjusted RL Percentage of the outstanding principal amount of Letter of Credit Outstandings equalling such Bank's Revolving Loan Commitment at such time. "Adjusted Total Revolving Loan Commitment" shall mean at any time the Total Revolving Loan Commitment less the aggregate Revolving Loan Commitments of all Defaulting Banks. "Affected Eurodollar Loans" shall have the meaning provided in Section 4.02(i). "Affiliate" shall mean, with respect to any Person, any other Person (including for purposes of Section 9.06 only, all directors, officers and partners of such Person) directly or indirectly controlling, controlled by, or under direct or indirect com- -95- 103 mon control with, such Person; provided, however, that for purposes of Section 9.06, an Affiliate of Holdings shall include any Person that directly or indirectly owns more than 10% of any class of the capital stock of Holdings. A Person shall be deemed to control another Person if such Person possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of such other Person, whether through the ownership of voting securities, by contract or otherwise. "Agents" shall mean the Managing Agent and each of Goldman Sachs Credit Partners L.P., as Documentation Agent, and NationsBank of Texas, N.A. and Toronto Dominion (Texas), Inc., as Syndication Agents, so long as each remains a Bank. "Agreement" shall mean this Amended and Restated Credit Agreement, as amended, modified, extended, renewed, replaced, restated or supplemented from time to time. "Amended and Restated Borrower Pledge Agreement" shall have the meaning provided in the Existing Credit Agreement. "Amended and Restated Borrower Security Agreement" shall have the meaning provided in the Existing Credit Agreement. "Amended and Restated Environmental Indemnity Agreement" shall have the meaning provided in the Existing Credit Agreement. "Amended and Restated Holdings Pledge Agreement" shall have the meaning provided in the Existing Credit Agreement. "Amended and Restated Holdings Security Agreement" shall have the meaning provided in the Existing Credit Agreement. "Amended and Restated Security Agreements" shall mean the Amended and Restated Holdings Security Agreement, the Amended and Restated Borrower Security Agreement and the Amended and Restated Subsidiary Security Agreement. "Amended and Restated Subsidiary Guaranty" shall have the meaning provided in the Existing Credit Agreement. "Amended and Restated Subsidiary Pledge Agreement" shall have the meaning provided in the Existing Credit Agreement. -96- 104 "Amended and Restated Subsidiary Security Agreement" shall have the meaning provided in the Existing Credit Agreement. "Applicable Margin" shall mean (A) for the period from and including the Second Restatement Effective Date to and including the date which is six months after the Second Restatement Effective Date, a percentage per annum equal to (x) in the case of Base Rate Loans, 1.125 % and (y) in the case of Eurodollar Loans, 2.125 % and (B) thereafter, from and after each day of delivery of any certificate delivered in accordance with the following sentence (each a "Start Date") to and including the applicable End Date described below, a percentage per annum based on the then-existing Leverage Ratio as set forth below:
Base Rate Eurodollar Leverage Ratio Loans Loans - -------------- ----- ----- Equal to or greater than 6.5:1 1.125% 2.125% Equal to or greater than 6.0:1 but less than 6.5:1 .75% 1.75% Equal to or greater than 5.5:1 but less than 6.O:l .50% 1.50% Equal to or greater than 5.0:1 but less than 5.5:1 .25% 1.25% Equal to or greater than 4.5:1 but less than 5.0:1 0% 1.00% Less than 4.5:1 0% 0.75%
The Leverage Ratio, for purposes of calculating the Applicable Margin, shall be determined based on the delivery of a certificate of the Borrower to the Managing Agent (with a copy to be sent by the Managing Agent to each Bank), certified by an Authorized Officer of the Borrower within 30 days after the last day of any fiscal quarter of the Borrower (commencing with its fiscal quarter ending December 31, -97- 105 1997), which certificate shall set forth the calculation of the Leverage Ratio for the Test Period ended immediately prior to the relevant Start Date and the Applicable Margin which shall be thereafter applicable (until same is changed or ceases to apply in accordance with the following sentences). The Applicable Margin so determined shall apply, except as set forth in the succeeding sentence, from the Start Date to the earlier of (x) the date on which the next certificate is delivered to the Managing Agent and (y) the date which is 30 days following the last day of the fiscal quarter in which the previous Start Date occurred (the "End Date"), at which time, if no certificate has been delivered to the Managing Agent indicating an entitlement to an Applicable Margin other than in the case of Base Rate Loans, 1.125%, and in the case of Eurodollar Loans, 2.125% (and thus commencing a new Start Date), the Applicable Margin shall be, in the case of Base Rate Loans, 1.125%, and, in the case of Eurodollar Loans, 2.125%. Notwithstanding anything to the contrary contained above in this definition, the Applicable Margin shall be, in the case of Base Rate Loans, 1.125% and, in the case of Eurodollar Loans, 2.125% at all times during which there shall exist a Default or an Event of Default. "Asset Swapped Station" shall have the meaning provided in Section 9.02(ix). "Asset Target Station" shall have the meaning provided in Section 9.02(ix). "Assignment and Assumption Agreement" shall mean the Assignment and Assumption Agreement substantially in the form of Exhibit L (appropriately completed). "Authorized Officer" of any Credit Party shall mean any of the Chairman of the Board, the President, the Chief Executive Officer, any Vice President, the Treasurer, the Secretary, any Assistant Secretary, any Assistant Treasurer, the Chief Financial Officer or the Controller of such Credit Party or any other officer of such Credit Party which is designated in writing to the Managing Agent and the Issuing Bank or any of the foregoing officers of such Credit Party as being authorized to give such notices under this Agreement. "Bank" shall mean each financial institution listed on Schedule I, as well as any Person which becomes a "Bank" hereunder pursuant to Sections 1.13 and 13.04(b). "Bank Default" shall mean (i) the refusal (which has not been retracted) of a Bank to make available its portion of any Borrowing or to fund its portion of any unreimbursed payment under Section 2.03(c) or (ii) a Bank having notified in writing the Borrower and/or the Managing Agent that it does not intend to comply with its -98- 106 obligations under Section 1.01(a), 1.01(b) or 2, in the case of either clause (i) or (ii) as a result of any takeover of such Bank by any regulatory authority or agency. "Bankruptcy Code" shall have the meaning provided in Section 10.05. "Base Rate" at any time shall mean the higher of (i) 1/2 of 1% in excess of the Adjusted Certificate of Deposit Rate and (ii) the Prime Lending Rate. "Base Rate Loan" shall mean each Loan designated or deemed designated as such by the Borrower at the time of the incurrence thereof or conversion thereto. "Borrower" shall have the meaning provided in the first paragraph of this Agreement. " Borrowing" shall mean the borrowing of one Type of Loan of a single Tranche from all the Banks having Commitments of the respective Tranche on a given date (or resulting from a conversion or conversions on such date) having in the case of Eurodollar Loans the same Interest Period, provided that Base Rate Loans incurred pursuant to Section 1.10(b) shall be considered part of the related Borrowing of Eurodollar Loans. "Bridge Financing" shall mean the incurrence by Holdings of up to $170,000,000 in unsecured senior Indebtedness from Bankers Trust New York Corporation pursuant to the terms of the Bridge Financing Documents, the proceeds of which shall be used to finance the Transaction. "Bridge Financing Documents" shall mean the Senior Credit Agreement, dated of even date herewith, among the Holdings, the Lenders named therein and Bankers Trust New York Corporation, as Agent, the Notes as defined therein, and any additional documents delivered in connection therewith, each as amended, modified, restated or supplemented, from time to time, in accordance with the terms hereof and thereof. "Broadcast Cash Flow" shall mean, with respect to any Station during any period, the sum of (x) EBITDA of such Station for such period (provided that for purposes of calculating compliance with Section 9.08, non-cash expenses relating to options to purchase common stock of Holdings issued by Holdings in 1994 to Steven Dinetz, the President and Chief Executive Officer of the Borrower, and certain Directors of the Borrower shall not be included in the determination of Broadcast Cash Flow for any period occurring on or after the Second Restatement Effective Date) and (y) corporate overhead expense allocated to such Station for such period; it being -99- 107 understood that the Broadcast Cash Flow of any Person shall mean the total Broadcast Cash Flow of all Stations owned by such Person. "BTCo" shall mean Bankers Trust Company in its individual capacity. "Business Day" shall mean (i) for all purposes other than as covered by clause (ii) below, any day except Saturday, Sunday and any day which shall be in New York City a legal holiday or a day on which banking institutions are authorized or required by law or other government action to close and (ii) with respect to all notices and determinations in connection with, and payments of principal and interest on, Eurodollar Loans, any day which is a Business Day described in clause (i) above and which is also a day for trading by and between banks in the New York interbank Eurodollar market. "Capital Expenditures" shall mean, with respect to any Person, all expenditures (excluding barter transactions effected in the ordinary course of business consistent with past practices) by such Person which should be capitalized in accordance with GAAP, including all such expenditures with respect to fixed or capital assets (including, without limitation, expenditures for maintenance and repairs which should be capitalized in accordance with GAAP) and the amount of Capitalized Lease Obligations incurred by such Person. "Capitalized Lease Obligations" of any Person shall mean all rental obligations which, under GAAP, are or will be required to be capitalized on the books of such Person, in each case taken at the amount thereof accounted for as indebtedness in accordance with GAAP. "Cash Equivalents" shall mean, as to any Person, (i) securities issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having maturities of not more than one year from the date of acquisition, (ii) time deposits and certificates of deposit of any commercial bank having, or which is the principal banking subsidiary of a bank holding company organized under the laws of the United States, any State thereof, the District of Columbia or any foreign jurisdiction having capital, surplus and undivided profits aggregating in excess of $200,000,000, with maturities of not more than one year from the date of acquisition by such Person, (iii) repurchase obligations with a term of not more than 90 days for underlying securities of the types described in clause (i) above entered into with any bank meeting the qualifications specified in clause (ii) above, (iv) commercial paper issued by any Person incorporated in the United States rated at least A-1 or the equivalent thereof by Standard & Poor's Corporation or at least P-1 or the equivalent thereof by Moody's Investors Service, Inc. and in each case maturing not more than one year -100- 108 after the date of acquisition by such Person, (v) investments in money market funds substantially all of whose assets are comprised of securities of the types described in clauses (i) through (iv) above and (vi) demand deposit accounts maintained in the ordinary course of business not in excess of $100,000 in the aggregate. "Chancellor Broadcasting Licensee" shall mean Chancellor Broadcasting Licensee Company, a Delaware corporation. "Change of Ownership" shall mean (i) Holdings shall cease to own beneficially 100% of the capital stock (other than the Series A Exchangeable Preferred Stock and the Exchangeable Preferred Stock) of the Borrower, or the Borrower or a Wholly-Owned Subsidiary of the Borrower shall cease to own beneficially 100% of the capital stock of the Chancellor Broadcasting Licensee, (ii) for any reason whatsoever any "Person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), excluding HM Group, is or becomes the "beneficial owner" (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of more than the greater of (x) 15% of the then outstanding Voting Stock of Holdings or (y) the percentage of the then outstanding Voting Stock of Holdings owned beneficially by the HM Group, (iii) the Board of Directors of Holdings shall cease to consist of a majority of Continuing Directors, (iv) a "Change of Control" under and as defined in the Series A Exchangeable Preferred Stock Documents, the Exchangeable Preferred Stock Documents, or after any issuance thereof, the 12-1/4% Junior Exchange Debentures or 12% Junior Exchange Debentures shall have occurred or (v) the Evergreen Merger shall have become effective. "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and the rulings issued thereunder. Section references to the Code are to the Code, as in effect at the Second Restatement Effective Date, and to any subsequent provision of the Code, amendatory thereof, supplemental thereto or substituted therefor. "Collateral" shall mean all property (whether real or personal) with respect to which any security interests have been granted (or purported to be granted) pursuant to any Security Document, including, without limitation, all Pledge Agreement Collateral, all Security Agreement Collateral, all Mortgaged Properties and all cash and Cash Equivalents delivered as collateral pursuant to Section 4.02 or Section 10 hereof and all Additional Collateral, if any (all of which shall in any event exclude any interest in the FCC Licenses to the extent prohibited by applicable law). "Collateral Agent" shall mean the Managing Agent acting as collateral agent for the Secured Creditors pursuant to the Security Documents. -101- 109 "Commitment" shall mean any of the commitments of any Bank, i.e., whether the Term Loan Commitment or Revolving Loan Commitment. "Commitment Commission" shall have the meaning provided in Section 3.01(a). "Communications Act" shall have the meaning provided in Section 7.23. "Consolidated Broadcast Cash Flow" shall mean, for any period, the Broadcast Cash Flow of Holdings and its Consolidated Subsidiaries determined on a consolidated basis in accordance with GAAP during such period. "Consolidated Current Assets" shall mean, at any time, the consolidated current assets of Holdings and its Consolidated Subsidiaries determined on a consolidated basis in accordance with GAAP plus the Total Unutilized Revolving Loan Commitment at such time. "Consolidated Current Liabilities" shall mean, at any time, the consolidated current liabilities of Holdings and its Consolidated Subsidiaries determined on a consolidated basis in accordance with GAAP at such time, but excluding (i) the current portion of any Indebtedness under this Agreement and any other long-term Indebtedness which would otherwise be included therein, (ii) accrued but unpaid interest with respect to the Indebtedness described in clause (i), and (iii) the current portion of Capitalized Lease Obligations. "Consolidated EBIT" shall mean, for any period, the Consolidated Net Income of Holdings and its Consolidated Subsidiaries determined on a consolidated basis in accordance with GAAP, before Consolidated Net Interest Expense and provision for taxes and without giving effect to any extraordinary gains or losses or gains or losses from sales of assets other than inventory sold in the ordinary course of business. "Consolidated EBITDA" shall mean, for any period, Consolidated EBIT, adjusted by adding thereto the amount of all amortization of intangibles and depreciation that were deducted in arriving at Consolidated EBIT for such period, provided, that for any period ending in the first calendar year following the Second Restatement Effective Date, Consolidated EBITDA shall be calculated on a pro forma basis as if all Stations owned at the end of such period were owned for the entire period, provided, further, for purposes of calculating compliance with Sections 9.08, 9.09 and 9.10, in the event that any sale or other disposition of Stations is made in compliance with Section 9.02, and the proceeds thereof are not applied to repay Loans, all in accordance with Section 4.02(e), for the period (not to exceed 180 days) that the proceeds thereof are held as -102- 110 cash collateral pursuant to Section 4.02(e), the amount equal to the Broadcast Cash Flow of the Stations so sold or so disposed at the end of the most recent fiscal quarter prior to such sale or disposition for the four fiscal quarters prior thereto shall be included in the determination of Consolidated EBITDA during such period, provided, further, that for purposes of calculating compliance with Sections 9.08, 9.09 and 9.10, non-cash expenses relating to options to purchase common stock of Holdings issued by Holdings in 1994 to Steven Dinetz, the President and Chief Executive Officer of the Borrower, Ms. Matrice Ellis-Kirk, Mr. Marvin Dinetz, Mr. Eric W. Neumann, Mr. Jeffrey A. Marcus, Mr. John H. Massey and certain Directors of the Borrower shall not be included in the determination of Consolidated EBITDA for any period occurring on or after the Second Restatement Effective Date. "Consolidated Indebtedness" shall mean, at any time, without duplication, the sum of the aggregate outstanding principal amount of all Indebtedness for borrowed money and the principal component of Capitalized Lease Obligations of Holdings and its Consolidated Subsidiaries determined on a consolidated basis in accordance with GAAP. "Consolidated Net Cash Interest Expense" shall mean, for any period, the total consolidated cash interest expense of Holdings and its Consolidated Subsidiaries determined on a consolidated basis in accordance with GAAP for such period plus, without duplication, that portion of Capitalized Lease Obligations of Holdings and its Consolidated Subsidiaries representing the interest factor for such period in each case net of the total consolidated cash interest income of Holdings, its Consolidated Subsidiaries for such period. "Consolidated Net Income" shall mean, for any period, net after tax income of Holdings and its Consolidated Subsidiaries determined on a consolidated basis in accordance with GAAP. "Consolidated Net Interest Expense" shall mean, for any period, the total consolidated interest expense of Holdings and its Consolidated Subsidiaries determined on a consolidated basis in accordance with GAAP for such period (calculated without regard to any limitations on the payment thereof) plus, without duplication, that portion of Capitalized Lease Obligations of Holdings and its Consolidated Subsidiaries determined on a consolidated basis in accordance with GAAP representing the interest factor for such period in each case net of the total consolidated cash interest income of Holdings and its Consolidated Subsidiaries for such period, but excluding the amortization of any deferred financing costs incurred in connection with this Agreement. -103- 111 "Consolidated Subsidiaries" shall mean, as to any Person, all Subsidiaries of such Person which are consolidated with such Person for financial reporting purposes in accordance with GAAP. "Contingent Obligation" shall mean, as to any Person, any obligation of such Person guaranteeing or intended to guarantee any Indebtedness, leases, dividends or other obligations ("primary obligations") of any other Person (the "primary obligor") in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (x) for the purchase or payment of any such primary obligation or (y) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the holder of such primary obligation against loss in respect thereof; provided, however, that the term Contingent Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Contingent Obligation is made (or, if less, the maximum amount of such primary obligation for which such Person may be liable pursuant to the terms of the instrument evidencing such Contingent Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in good faith. "Continuing Bank" shall mean each Existing Bank with a Commitment under this Agreement (immediately upon giving effect to the Second Restatement Effective Date). "Continuing Directors" shall mean the directors of Holdings on the Second Restatement Effective Date and each other director, if such director's nomination for election to the Board of Directors of Holdings is recommended by a majority of the then Continuing Directors or any other nominee of the HM Group. "Convertible Preferred Stock" shall mean Holding's 7% Convertible Preferred Stock. "Credit Documents" shall mean this Agreement and, after the execution and delivery thereof pursuant to the terms of this Agreement, each Note, each Security Document, the Amended and Restated Environmental Indemnity Agreement, the -104- 112 Environmental Indemnity Agreement, the Amended and Restated Subsidiary Guaranty and the Subsidiary Guarantee. "Credit Event" shall mean the making of any Loan or the issuance of any Letter of Credit. "Credit Party" shall mean Holdings, the Borrower and each Subsidiary thereof party to a Credit Document. "Default" shall mean any event, act or condition which with notice or lapse of time, or both, would constitute an Event of Default. "Defaulting Bank" shall mean any Bank with respect to which a Bank Default is in effect. "Dinetz" shall mean Mr. Steven Dinetz. "Dinetz Employment Contract" shall mean the contract between Holdings and Dinetz. "Dividend" with respect to any Person shall mean that such Person has declared or paid a dividend or returned any equity capital to its stockholders or authorized or made any other distribution, payment or delivery of property (other than common stock of such Person) or cash to its stockholders as such, or redeemed, retired, purchased or otherwise acquired, directly or indirectly, for consideration any shares of any class of its capital stock outstanding on or after the Second Restatement Effective Date (or any options or warrants issued by such Person with respect to its capital stock), or set aside any funds for any of the foregoing purposes, or shall have permitted any of its Subsidiaries to purchase or otherwise acquire for consideration any shares of any class of the capital stock of such Person outstanding on or after the Second Restatement Effective Date (or any options or warrants issued by such Person with respect to its capital stock). "Documentation Agent" shall mean Goldman Sachs Credit Partners L.P., in its capacity as Documentation Agent for the Banks hereunder. "Documents" shall mean the Transaction Documents, the Bridge Financing Documents and the Evergreen Acquisition Documents. "Dollars" and the sign "$" shall each mean freely transferable lawful money of the United States. -105- 113 "Drawing" shall have the meaning provided in Section 2.04(b). "EBIT" shall mean, for any period, net after tax income of any Person before Net Interest Expense and provision for taxes and without giving effect to any extraordinary gains or losses or gains or losses from sales of assets other than inventory sold in the ordinary course of business. "EBITDA" shall mean, for any period, EBIT, adjusted by adding thereto the amount of all amortization of intangibles and depreciation that were deducted in arriving at EBIT for such period. "8 3/4% Senior Subordinated Note Documents" shall mean and include each of the documents and other agreements entered into (including, without limitation, the 8 3/4% Senior Subordinated Note Indenture relating to the issuance by the Borrower of the 8 3/4% Senior Subordinated Notes, as in effect on the Second Restatement Effective Date and as the same may be entered into, modified, supplemented or amended from time to time pursuant to the terms hereof and thereof. "8 3/4% Senior Subordinated Note Indenture" shall mean the indenture, dated as of June 24, 1997, between the Borrower and United States Trust Company of Texas, as Trustee, as amended, modified, extended, reserved, replaced, restated or supplemented from time to time pursuant to the terms hereof and thereof. "8 3/4% Senior Subordinated Notes" shall mean the Borrower's 8 3/4% Senior Subordinated Notes due 2007 issued pursuant to the 8 3/4% Senior Subordinated Note Indenture. "Eligible Transferee" shall mean and include a commercial bank, mutual funds, financial institution or other institutional "accredited investor" (as defined in Regulation D of the Securities Act). "Employee Stock Option Plan" shall mean (i) the Chancellor Corporation Stock Award Plan, (ii) the 1994 Directors Stock Option Plan and (iii) any plan, to be entered into after the Second Restatement Effective Date, for the compensation of management of Holdings or any of its Subsidiaries, or any arrangement for the benefit of management of Holdings or any of its Subsidiaries, in form and substance reasonably acceptable to the Managing Agent. "EMHC" shall mean Evergreen Mezzanine Holdings Corporation, a Delaware corporation, which, no later than the date upon which the Evergreen Merger is consummated, shall own all of the issued and outstanding capital stock of Evergreen Media of LA. -106- 114 "End Date" shall have the meaning provided in the definition of Applicable Margin. "Environmental Claims" shall have the meaning provided in the Amended and Restated Environmental Indemnity Agreement and the Environmental Indemnity Agreement. "Environmental Indemnity Agreement" shall have the meaning provided in Section 5.12. "Environmental Law" shall have the meaning provided in the Amended and Restated Environmental Indemnity Agreement and the Environmental Indemnity Agreement. "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to ERISA are to ERISA, as in effect at the Second Restatement Effective Date and any subsequent provisions of ERISA, amendatory thereof, supplemental thereto or substituted therefor. "ERISA Affiliate" shall mean each person (as defined in Section 3(9) of ERISA) which together with the Borrower or any Subsidiary of the Borrower would be deemed to be a "single employer" within the meaning of Section 414(b), (c), (m) or (o) of the Code. "Eurodollar Loan" shall mean each Loan designated as such by the Borrower at the time of the incurrence thereof or conversion thereto. "Eurodollar Rate" shall mean the offered quotation to first-class banks in the New York interbank Eurodollar market by BTCo for Dollar deposits of amounts in immediately available funds comparable to the outstanding principal amount of the Eurodollar Loan of BTCo with maturities comparable to the Interest Period applicable to such Eurodollar Loan commencing two Business Days thereafter as of 10:00 A.M. (New York time) on the date which is two Business Days prior to the commencement of such Interest Period, divided (and rounded off to the nearest 1/16 of 1%) by a percentage equal to 100% minus the then stated maximum rate of all reserve requirements (including, without limitation, any marginal, emergency, supplemental, special or other reserves required by applicable law) applicable to any member bank of the Federal Reserve System in respect of Eurocurrency funding or liabilities as defined in Regulation D (or any successor category of liabilities under Regulation D). "Event of Default" shall have the meaning provided in Section 10. -107- 115 "Evergreen" shall mean Evergreen Media Corporation, a Delaware corporation. "Evergreen Acquisition Documents" shall mean the Evergreen Merger Agreement and all other agreements and documents relating to the Evergreen Merger. "Evergreen Administrative Agent" shall have the meaning provided in Section 1.01(c). "Evergreen Loan Agreement" shall have the meaning provided in Section 1.01(c). "Evergreen Merger" shall mean the merger of Holdings with and into EMHC and the merger of the Borrower with and into Evergreen Media of LA, with EMHC and Evergreen of LA being the surviving corporations, pursuant to the Evergreen Merger Agreement. "Evergreen Merger Agreement" shall mean the Agreement and Plan of Merger, dated as of February 19, 1997 by and among Holdings, the Company, Evergreen and Evergreen Media of LA. "Evergreen Media of LA" shall mean Evergreen Media Corporation of Los Angeles, a Delaware corporation. "Excess Cash Flow" shall mean, for any period, the remainder of (a) the sum of (i) Adjusted Consolidated Net Income for such period and (ii) the decrease, if any, in Adjusted Consolidated Working Capital from the first day to the last day of such period, minus (b) the sum of (i) the amount of Capital Expenditures made by the Borrower and its Subsidiaries on a consolidated basis during such period pursuant to and in accordance with Section 9.07(a) and (b), except to the extent financed with the proceeds of Indebtedness or pursuant to Capitalized Lease Obligations, (ii) the aggregate amount of permanent principal payments of Indebtedness for borrowed money of the Borrower and the permanent repayment of the principal component of Capitalized Lease Obligations of the Borrower and its Subsidiaries (excluding (1) payments with proceeds of issuances of Indebtedness or equity or with proceeds of asset sales and (2) payments of Loans or other Obligations), provided that repayments of Loans shall be deducted in determining Excess Cash Flow if such repayments were (x) required as a result of a Scheduled Repayment under Section 4.02(b) (but not as a reduction to the amount of Scheduled Repayments pursuant to another provision of this Agreement) or (y) made as a voluntary prepayment pursuant to Section 4.01 with internally generated funds (but in the case of a voluntary prepayment of Revolving Loans, only to the extent accompanied by a voluntary reduction to the Total Revolving Loan Commitment)) dur- -108- 116 ing such period, (iii) the increase, if any, in Adjusted Consolidated Working Capital from the first day to the last day of such period, (iv) the amount of all expenses (including expenses incurred in connection with acquisitions) that have been paid during such period to the extent that such expenses have been capitalized in accordance with GAAP but only to the extent that the payment thereof does not otherwise reduce Adjusted Consolidated Net Income and (v) the aggregate amount of any payments made by Holdings to reduce the principal amount of Indebtedness under the Bridge Financing. "Excess Cash Payment Date" shall mean the date occurring 90 days after the last day of each fiscal year of the Borrower (beginning with its fiscal year ending December 31, 1997). "Excess Cash Payment Period" shall mean with respect to the repayment required on each Excess Cash Payment Date, the immediately preceding fiscal year of the Borrower. "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. "Exchangeable Preferred Stock" shall mean the Borrower's 12% Exchangeable Preferred Stock due 2009. "Exchangeable Preferred Stock Documents" shall mean each document relating to the Exchangeable Preferred Stock (including, without limitation, the 12% Junior Exchange Debenture Indenture and all documents relating thereto). "Existing Banks" shall mean each Person which was a Bank under, and as defined in, the Existing Credit Agreement. "Existing Chancellor Entities" shall mean Holdings, the Borrower and each of the Borrower's Subsidiaries prior to giving effect to the Viacom Acquisition. "Existing Credit Agreement" shall have the meaning provided in the first Whereas clause of this Agreement. "Existing Debt" shall have the meaning provided in Section 5.06(a). "Existing Debt Agreements" shall have the meaning provided in Section 5.06(a). -109- 117 "Existing Letters of Credit" shall mean those letters of credit outstanding under the Existing Credit Agreement prior to the Second Restatement Effective Date and which remain outstanding following the Second Restatement Effective Date, as disclosed on Schedule II. "Existing Loans" shall mean, collectively the Existing Term Loans and the Existing Revolving Loans. "Existing Mortgage Policies" shall mean the "Mortgage Policies" under, and as defined in, the Existing Credit Agreement. "Existing Mortgaged Properties" shall mean all Real Property of the Borrower and its Subsidiaries listed on Part A of Schedule II and designated as "Existing Mortgaged Properties" therein. "Existing Mortgages" shall mean all "Mortgages" (as defined in the Existing Credit Agreement), "Existing Mortgages" (as defined in the Existing Credit Agreement) and "Additional Mortgages" (as defined in the Existing Credit Agreement) granted by the Borrower and its Subsidiaries or assumed pursuant to the Existing Credit Agreement which have not been released by the lenders thereunder prior to the Second Restatement Effective Date. "Existing Revolving Loans" shall mean the "Revolving Loans" under, and as defined in the Existing Credit Agreement. "Existing Senior Subordinated Note Documents" shall mean and include each of the documents and other agreements entered into (including, without limitation, the Existing Senior Subordinated Note Indenture, the Second Senior Subordinated Note Indenture and the Supplemental Indenture) relating to the issuance by the Borrower of the Existing Senior Subordinated Notes, as in effect on the Second Restatement Effective Date and as the same may be entered into, modified, supplemented or amended from time to time pursuant to the terms hereof and thereof. "Existing Senior Subordinated Note Indenture" shall mean that certain indenture dated as of October 12, 1994 by and between the Borrower and United States Trust Company of Texas, as Trustee, as amended, modified, extended, renewed, replaced, restated or supplemented prior to the effectiveness of the Indenture Amendment. "Existing Senior Subordinated Notes" shall mean the Borrower's 9 3/8% Senior Subordinated Notes due 2004 issued pursuant to the Second Senior Subordinated Note Indenture and any of the Borrower's 12 1/2% Senior Subordinated Notes due 2004 -110- 118 issued pursuant to the Existing Senior Subordinated Note Indenture which remain outstanding following the Tender Offer. "Existing Term Loans" shall mean the "Term Loans" under, and as defined in, the Existing Credit Agreement. "Facing Fee" shall have the meaning provided in Section 3.01(c). "FCC" shall mean the Federal Communications Commission, or any successor thereto. "FCC Consent" shall have the meaning provided in Section 5.07(c). "FCC Licenses" shall have the meaning provided in Section 7.23. "Federal Funds Rate" shall mean for any period, a fluctuating interest rate equal for each day during such period to the weighted average of the rates on overnight Federal Funds transactions with members of the Federal Reserve System arranged by Federal Funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the Managing Agent from three Federal Funds brokers of recognized standing selected by the Managing Agent. "Fees" shall mean all amounts payable pursuant to or referred to in Section 3.01. "GAAP" shall have the meaning provided in Section 13.07(a). "Guaranteed Obligations" shall mean (i) the full and prompt payment when due (whether at the stated maturity, by acceleration or otherwise) of the principal and interest on each Note issued by the Borrower to such Bank, and Loans made, under the Credit Agreement and all reimbursement obligations and Unpaid Drawings with respect to Letters of Credit, together with all the other obligations and liabilities (including, without limitation, indemnities, fees and interest thereon) of the Borrower to such Bank now existing or hereafter incurred under, arising out of or in connection with the Credit Agreement or any other Credit Document and the due performance and compliance with all the terms, conditions and agreements contained in the Credit Documents by the Borrower and (ii) the full and prompt payment when due (whether by acceleration or otherwise) of all obligations of the Borrower owing under any Interest Rate Protection Agreement, whether now in existence or hereafter arising, and -111- 119 the due performance and compliance with all terms, conditions and agreements contained therein. "Guarantor" shall mean Holdings and any guarantor that is party to the Amended and Restated Subsidiary Guaranty or the Subsidiary Guaranty. "Guaranty" shall mean the guaranty made by Holdings pursuant to Section 14, the Amended and Restated Subsidiary Guaranty, the Subsidiary Guaranty and any guaranty executed pursuant to Section 8.12(e). "Hazardous Materials" shall have the meaning provided in the Amended and Restated Environmental Indemnity Agreement and the Environmental Indemnity Agreement. "HM Group" shall mean, collectively, (i) Hicks, Muse, Tate & Furst Incorporated, its Affiliates and Dinetz taken as a whole, (ii) so long as Hicks, Muse, Tate & Furst Incorporated, its Affiliates and Dinetz taken as a whole possess sole voting right with respect to the Voting Stock held by each such individual, such individuals who are or were employees, officers, directors or partners of Hicks, Muse, Tate & Furst Incorporated or such Affiliate and the family members of such individuals or trusts created for the sole benefit of such family members and (iii) so long as Hicks, Muse, Tate & Furst Incorporated, its Affiliates and Dinetz taken as a whole possess sole voting right with respect to the Voting Stock of Holdings held by each such Person, any Person not otherwise described by clause (i) and (ii) above, provided that the aggregate number of shares held by all such Persons in accordance with this clause (iii) at any time shall not exceed 3% of the aggregate number of shares held by the Persons described in clause (i) and (ii) above at such time. "Holdings" shall have the meaning provided in the first paragraph of this Agreement. "Holdings Class A Common Stock" shall have the meaning provided in Section 7.14(a). "Holdings Class B Common Stock" shall have the meaning provided in Section 7.14(a). "Holdings Class C Common Stock" shall have the meaning provided in Section 7.14(a). "Holdings Common Stock" shall mean Holdings Class A Common Stock, Holdings Class B Common Stock and Holdings Class C Common Stock. -112- 120 "Holdings Guaranty" shall mean the guaranty provided to the Banks pursuant to Section 14. "Holdings Subordinated Notes" shall have the meaning set forth in Section 9.04(vii). "Indebtedness" shall mean, as to any Person, without duplication, (1) all indebtedness (including principal, interest, fees and charges) of such Person for borrowed money or for the deferred purchase price of property or services due more than 90 days after acquisition of the property or receipt of services or which is otherwise represented by a note, (ii) the maximum amount available to be drawn under all letters of credit issued for the account of such Person and all unpaid drawings in respect of such letters of credit, (iii) all Indebtedness of the types described in clause (i), (ii), (iv), (v), (vi) or (vii) of this definition secured by any Lien on any property owned by such Person, whether or not such Indebtedness has been assumed by such Person (to the extent of the lesser of the amount of such Indebtedness and the value of the respective property), (iv) Capitalized Lease Obligations, (v) all obligations of such person to pay a specified purchase price for goods or services, whether or not delivered or accepted, i.e., take-or-pay and similar obligations, (vi) all Contingent Obligations of such Person and (vii) all obligations under any Interest Rate Protection Agreement or under any similar type of agreement; provided that Indebtedness shall not include trade payables and accrued expenses, in each case arising in the ordinary course of business. "Indenture Amendment" shall mean the amendment to the Existing Senior Subordinated Note Indenture (as so amended and as the same may be further amended, modified, restated or supplemented from time to time, the "Supplemental Indenture") eliminating substantially all of the restrictive covenants therein, as described in the Offer to Purchase and Consent Solicitation Statement. "Interest Determination Date" shall mean, with respect to any Eurodollar Loan, the second Business Day prior to the commencement of any Interest Period relating to such Eurodollar Loan. "Interest Period" shall have the meaning provided in Section 1.09. "Interest Rate Protection Agreement" shall mean any interest rate swap agreement, interest rate cap agreement, interest collar agreement, interest rate hedging agreement or other similar agreement or arrangement. "Issuing Bank" shall mean, BTCO and any Bank which at the request of the Borrower and with the consent of the Managing Agent agrees, in such Bank's sole discretion, to become an Issuing Bank for the purpose of issuing Letters of Credit -113- 121 pursuant to Section 2. The sole Issuing Bank on the Second Restatement Effective Date is BTCo. "KIBB" shall mean KIBB Inc., a Delaware corporation. "KYSR" shall mean KYSR Inc., a Delaware corporation. "L/C Supportable Obligations" shall mean (i) obligations of the Borrower or its Subsidiaries incurred in the ordinary course of business with respect to insurance obligations and workers' compensation, surety bonds and other similar statutory obligations and (ii) such other obligations of the Borrower or any of its Subsidiaries as are reasonably acceptable to the respective Issuing Bank and otherwise permitted to exist pursuant to the terms of this Agreement. "Leaseholds" of any Person means all the right, title and interest of such Person as lessee or licensee in, to and under leases or licenses of land, improvements and/or fixtures. "Lenders" shall have the meaning provided in Section 1.01(c). "Letter of Credit" shall have the meaning provided in Section 2.01(a). "Letter of Credit Fee" shall have the meaning provided in Section 3.01(b). "Letter of Credit Outstandings" shall mean, at any time, the sum of (i) the aggregate Stated Amount of all outstanding Letters of Credit and (ii) the amount of all Unpaid Drawings relating to Letters of Credit. "Letter of Credit Request" shall have the meaning provided in Section 2.02(a). "Leverage Ratio" shall mean on the date of determination thereof the ratio of (x) Consolidated Indebtedness on such date less the outstanding principal amount of the Bridge Financing on such date to (y) (i) in the case of any date occurring on or after the Test Period ending June 30, 1997 (but prior to the last date of the next succeeding Test Period), Consolidated EBITDA for such Test Period multiplied by 4, (ii) in the case of any date occurring on or after the Test Period ending September 30, 1997 (but prior to the last date of the next succeeding Test Period), Consolidated EBITDA for such Test Period multiplied by 2, (iii) in the case of any date occurring on or after the Test Period ending December 31, 1997 (but prior to the last date of the next succeeding Test Period), Consolidated EBITDA for such Test Period multiplied -114- 122 by 4/3 and (iv) thereafter Consolidated EBITDA for the Test Period most recently ended (taken as one accounting period) and ending on such date, provided that, with respect to periods prior to June 30, 1998, for purposes of calculating the Leverage Ratio, Consolidated EBITDA shall include Broadcast Cash Flow of all Stations owned on the date of determination for less than the entirety of such Test Period as if such Stations had been owned by the Borrower or its Subsidiaries for the full Test Period, less corporate overhead attributable to such Stations for such Test Period. Notwithstanding anything to the contrary contained in the immediately preceding sentence, for purposes of determining the Leverage Ratio in connection with Sections 3.01(a), the denominator shall be Consolidated EBITDA for the then most recently ended Test Period. "License Subsidiary" shall mean Chancellor Broadcasting Licensee, Shamrock, Shamrock Radio, Shamrock Broadcasting Licenses and Trefoil, KIBB, KYSR, WDRQ and WLIT. "Lien" shall mean any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), preference, priority or other security agreement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement, any financing or similar statement or notice filed under the UCC or any other similar recording or notice statute, and any lease having substantially the same effect as any of the foregoing). "Loan" shall mean each Term Loan and each Revolving Loan. "Management Agreements" shall have the meaning provided in Section 5.05. "Managing Agent" shall mean Bankers Trust Company, in its capacity as Managing Agent for the Banks hereunder, and shall include any successor to the Managing Agent appointed pursuant to Section 12.09. "Margin Stock" shall have the meaning provided in Regulation U. "Maturity Date" shall mean the earlier of (x) the date of consummation of the Evergreen Merger and (y) July 2, 2004. "Monitoring and Oversight Agreements" shall have the meaning provided in Section 9.06(iv). -115- 123 "Mortgage" shall have the meaning provided in Section 5.11(a), and, after the execution and delivery thereof, shall include each Additional Mortgage delivered pursuant to Section 8.12. "Mortgage Amendment" shall have the meaning provided in Section 5.11(a). "Mortgage Policies" shall have the meaning provided in Section 5.11(c). "Mortgaged Properties" shall have the meaning provided in Section 5.11(a) and shall include any real property mortgaged pursuant to Section 8.12. "Net Interest Expense" shall mean, for any period, the total interest expense of any Person for such period (calculated without regard to any limitations on the payment thereof) plus, without duplication, that portion of Capitalized Lease Obligations of such Person representing the interest factor for such period in each case net of the total consolidated cash interest income of such Person for such period, but excluding the amortization of any deferred financing costs incurred in connection with this Agreement. "Net Sale Proceeds" shall mean for any sale, lease, transfer or other disposition of assets, the gross cash proceeds (including any cash received by way of deferred payment pursuant to a promissory note, receivable or otherwise, but only as and when received) received by Holdings and/or any of its Subsidiaries from such sale, lease, transfer or other disposition, net of reasonable transaction costs (including, without limitation, any underwriting, brokerage or other customary selling commissions and reasonable legal, advisory and other fees and expenses, including title and recording expenses and reasonable expenses incurred for preparing such assets for sale, associated therewith) and payments of unassumed liabilities relating to the assets sold at the time of, or within 30 days after, the date of such sale, the amount of such gross cash proceeds required to be used to repay any Indebtedness (other than Indebtedness of the Banks pursuant to this Agreement) which is secured by the respective assets which were sold, and the estimated marginal increase in income taxes which will be payable by Holdings' consolidated group with respect to the fiscal year in which the sale occurs as a result of such sale; but excluding any portion of any such gross cash proceeds which Holdings determines in good faith should be reserved for post-closing adjustments (to the extent Holdings' delivers to the Banks a certificate signed by an Authorized Officer as to such determination), it being understood and agreed that on the day that all such post-closing adjustments have been determined (which shall not be later than six months following the date of the respective asset sale), the amount (if any) by which the reserved amount in respect of such sale or disposition exceeds the actual -116- 124 post-closing adjustments payable by Holdings or any of its Subsidiaries shall constitute Net Sale Proceeds on such date). "New Banks" shall mean each of the Persons listed on Schedule I hereto which is not a Continuing Bank. "Non-Continuing Bank" shall have the meaning provided in Section 13.18. "Non-Defaulting Bank" shall mean and include each Bank which is not a Defaulting Bank. "Note" shall mean each Term Note and each Revolving Note. "Notice of Borrowing" shall have the meaning provided in Section 1.03(a). "Notice of Conversion" shall have the meaning provided in Section 1.06. "Notice Office" shall mean the office of the Managing Agent located at 130 Liberty Street, New York, New York 10006, Attention: Mary Kay Coyle, or such other office as the Managing Agent may hereafter designate in writing as such to the other parties hereto. "Obligations" shall mean all amounts owing to the Managing Agent, the Collateral Agent or any Bank pursuant to the terms of this Agreement or any other Credit Document. "Offer to Purchase and Consent Solicitation Statement" shall mean the Offer to Purchase and Consent Solicitation Statement, dated as of May 2, 1997, mailed to the holders of the Existing Senior Subordinated Notes on or about May 2, 1997 in connection with the Tender Offer and Indenture Amendment. "OmniAmerica Equity Issuance" shall mean the issuance by Holdings of Class A Common Stock to the OmniAmerica Group pursuant to the acquisition by the Borrower of certain Stations previously owned by the OmniAmerica Group. "OmniAmerica Stations" shall have the meaning provided in the Existing Credit Agreement. "Operating Agreement" shall have the meaning provided in Section 8.04. -117- 125 "Original Credit Agreement" shall mean the Credit Agreement, dated as of February 19, 1996, among Holdings, the Borrower, the Banks (as defined therein) from time to time party thereto and the Managing Agent. "Participant" shall have the meaning provided in Section 2.03(a). "Payment Office" shall mean the office of the Managing Agent located at 130 Liberty Street, New York, New York 10006, Attention: Mary Kay Coyle, or such other office as the Managing Agent may hereafter designate in writing as such to the other parties hereto. "PBGC" shall mean the Pension Benefit Guaranty Corporation established pursuant to Section 4002 of ERISA, or any successor thereto. "Permitted Encumbrance" shall mean, with respect to any Mortgaged Property, such exceptions to title as are set forth in the title insurance policy or title commitment delivered with respect thereto, all of which exceptions must be acceptable to the Managing Agent in its reasonable discretion. "Permitted Issuance" shall mean (a) the issuance by Holdings of options or other equity securities of Holdings to outside directors, members of management or employees of Holdings or any Subsidiary of Holdings, (b) the issuance of securities as interest or dividends on pay-in-kind debt or preferred equity securities permitted hereunder and under the other Credit Documents, (c) the issuance to Holdings or any Subsidiary (or any director, with respect to directors' qualifying shares) by any of its Subsidiaries of any of their respective capital stock, in each case with respect to this clause (c) to the extent such capital stock is pledged to the Collateral Agent pursuant to the applicable Pledge Agreement (provided that only 65% of the voting capital stock of a foreign Subsidiary of the Borrower is required to be so pledged) and (d) the issuance by Holdings of shares of capital stock of Holdings to infuse additional capital into Holdings in an aggregate amount not to exceed $25,000,000. "Permitted Liens" shall have the meaning provided in Section 9.01. "Person" shall mean any individual, partnership, joint venture, limited liability company, firm, corporation, association, trust or other enterprise or any government or political subdivision or any agency, department or instrumentality thereof. "Plan" shall mean any multiemployer or single-employer plan, as defined in Section 4001 of ERISA, which is maintained or contributed to by (or to which there is an obligation to contribute of), the Borrower or a Subsidiary of the Borrower or an -118- 126 ERISA Affiliate, and each such plan for the five year period immediately following the latest date on which the Borrower, a Subsidiary of the Borrower or an ERISA Affiliate maintained, contributed or had an obligation to contribute to such plan. "Pledge Agreements" shall mean the Subsidiary Pledge Agreement, the Amended and Restated Holdings Pledge Agreement, the Amended and Restated Borrower Pledge Agreement and the Amended and Restated Subsidiary Pledge Agreement. "Pledge Agreement Collateral" shall mean all "Collateral" as defined in each of the Pledge Agreements. "Pledged Securities" shall mean "Pledged Securities" as defined in each of the Pledge Agreements. "Prime Lending Rate" shall mean the rate which Bankers Trust Company announces from time to time as its prime lending rate, the Prime Lending Rate to change when and as such prime lending rate changes. The Prime Lending Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer. Bankers Trust Company may make commercial loans or other loans at rates of interest at, above or below the Prime Lending Rate. "Projections" shall have the meaning provided in Section 7.05(d). "Quarterly Payment Date" shall mean the last Business Day of each January, April, July and October occurring after the Second Restatement Effective Date. "Real Property" of any Person shall mean all the right, title and interest of such Person in and to land, improvements and fixtures, including Leaseholds. "Recovery Event" shall mean the receipt by Holdings or any of its Subsidiaries of any (i) cash insurance proceeds payable (x) by reason of theft, loss, physical destruction or damage or any other similar event with respect to any property or assets of Holdings or any of its Subsidiaries and (y) under any policy of insurance required to be maintained under Section 8.03 or (ii) condemnation award payable by reason of eminent domain or deed in lieu thereof. "Register" shall have the meaning set forth in Section 13.17. -119- 127 "Regulation D" shall mean Regulation D of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof establishing reserve requirements. "Regulation G" shall mean Regulation G of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof. "Regulation T" shall mean Regulation T of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof. "Regulation U" shall mean Regulation U of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof. "Regulation X" shall mean Regulation X of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof. "Reinvestment Assets" shall have the meaning provided in Section 4.02(e). "Release" shall have meaning provided on the Amended and Restated Environmental Indemnity Agreement and the Environmental Indemnity Agreement. "Replaced Bank" shall have the meaning provided in Section 1.13. "Replacement Bank" shall have the meaning provided in Section 1.13. "Reportable Event" shall mean an event described in Section 4043(b) of ERISA with respect to a Plan as to which the 30-day notice requirement has not been waived by the PBGC. "Repurchased Notes" shall have the meaning provided in the definition of Tender Offer. "Required Banks" shall mean Non-Defaulting Banks, the sum of whose outstanding Term Loans and Revolving Loan Commitments represent an amount greater than 50% of the sum of (x) all outstanding Term Loans of Non-Defaulting Banks and (y) the Total Revolving Loan Commitment of Non-Defaulting Banks (or, if the Total -120- 128 Revolving Loan Commitment has been terminated, the outstanding Revolving Loans of each Bank). "Returns" shall have the meaning provided in Section 7.09. "Revolving Loan" shall have the meaning provided in Section 1.01(b). "Revolving Loan Commitment" shall mean, for each Bank, the amount set forth opposite such Bank's name in Schedule I hereto directly below the column entitled "Revolving Loan Commitment," as same may be (x) reduced from time to time pursuant to Sections 3.02, 3.03, 4.02 and/or 10 or (y) adjusted from time to time as a result of assignments to or from such Bank pursuant to Section 1.13 or 13.04(b). "Revolving Loan Conversion" shall have the meaning set forth in Section 1.01(b). "Revolving Note" shall have the meaning provided in Section 1.05(a). "RL Percentage" of any Bank at any time shall mean a fraction (expressed as a percentage) the numerator of which is the Revolving Loan Commitment of such Bank at such time and the denominator of which is the Total Revolving Loan Commitment at such time, provided that if the RL Percentage of any Bank is to be determined after the Total Revolving Loan Commitment has been terminated, then the RL Percentages of the Banks shall be determined immediately prior (and without giving effect) to such termination. "Scheduled Repayments" shall have the meaning provided in Section 4.02(b). "SEC" shall have the meaning provided in Section 8.01(h). "Second Restatement Effective Date" shall have the meaning provided in Section 13.10. "Second Senior Subordinated Note Indenture" shall mean that certain indenture dated as of February 8, 1996 by and between the Borrower, the Licensee Subsidiary, as Guarantor and U.S. Trust Company of Texas, N.A., as Trustee. "Section 4.04(b)(ii) Certificate" shall have the meaning provided in Section 4.04(b). -121- 129 "Secured Creditors" shall have the meaning assigned that term in the Security Documents. "Securities Act" shall mean the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. "Security Agreements" shall mean and include the Subsidiary Security Agreement, the Amended and Restated Holdings Security Agreement, the Amended and Restated Borrower Security Agreement, the Amended and Restated Subsidiary Security Agreement and any Additional Security Document delivered pursuant to Section 8.12. "Security Agreement Collateral" shall mean all "Collateral" as defined in each Security Agreement (which shall in any event exclude any interests in the FCC Licenses to the extent prohibited or ineffectual under applicable law). "Security Document" shall mean and include each Pledge Agreement, each Security Agreement, each Mortgage and, after the execution and delivery thereof, each Additional Mortgage and each Additional Security Document required to be delivered pursuant to Section 8.12. "Series A Exchangeable Preferred Stock" shall mean the Borrower's 12 1/4% Series A Senior Cumulative Exchangeable Preferred Stock due 2008 issued concurrently with the Original Credit Agreement. "Series A Exchangeable Preferred Stock Documents" shall mean each document relating to the Series A Exchangeable Preferred Stock (including, without limitation, the 12-1/4% Junior Exchange Debenture Indenture and all documents relating thereto). "SFX" shall mean WBLI, Inc., WHFM, Inc., WBAB, Inc. and WGBB, Inc., all New York corporations, together with WBLI-FM, Inc. and SFX Broadcasting, Inc., two Delaware corporations. "SFX Exchange" shall mean the simultaneous exchange by the Borrower of two of the OmniAmerica Stations (Stations WFYV (FM), Atlantic Beach and WAPE (FM), Jacksonville, Florida) and approximately $11,000,000 in cash for Stations WGBB (AM), Freeport, WBAB-FM, Babylon, WBLI (FM), Patchogue and WHFM (FM), Southampton, New York (the "SFX Stations") in accordance with the terms and provisions of the SFX Exchange Documents. -122- 130 "SFX Exchange Documents" shall mean the agreement, dated as of July 1, 1996, between the Borrower and SFX, as in effect on the Second Restatement Effective Date, and all other agreements and documents relating to the SFX Exchange. "SFX Stations" shall have the meaning provided in the definition of SFX Exchange. "Shamrock" shall mean Shamrock Broadcasting, Inc., a Delaware corporation. "Shamrock Broadcasting Licenses" shall mean Shamrock Broadcasting Licenses of Denver, Inc., a Delaware corporation. "Shamrock Radio" shall mean Shamrock Radio Licenses, Inc., a Delaware corporation. "Shareholders' Agreements" shall have the meaning provided in Section 5.05. "Standby Letter of Credit" shall have the meaning provided in Section 2.01 (a). "Start Date" shall have the meaning provided in the definition of Applicable Margin. "Stated Amount" of each Letter of Credit shall, at any time, mean the maximum amount available to be drawn thereunder (in each case determined without regard to whether any conditions to drawing could then be met). "Station Swap" shall have the meaning provided in Section 9.02(ix). "Stations" shall mean and include all of the radio stations owned and operated by Holdings and its Subsidiaries on the Second Restatement Effective Date, after giving effect to the Viacom Acquisition, and any radio stations acquired pursuant to Section 9.02. "Stock Swapped Station" shall have the meaning provided in Section 9.02(ix). "Stock Swaps" shall have the meaning provided in Section 9.02(ix). -123- 131 "Stock Target Station" shall have the meaning provided in Section 9.02(ix). "Stockholders Agreement" shall mean the amended and restated stockholders agreement dated as of February 14, 1996, among Holdings and the stockholders of Holdings party thereto, as amended through the Second Restatement Effective Date. "Subsidiary" shall mean, as to any Person, (i) any corporation more than 50% of whose stock of any class or classes having by the terms thereof ordinary voting power to elect a majority of the directors of such corporation (irrespective of whether or not at the time stock of any class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time owned by such Person and/or one or more Subsidiaries of such Person and (ii) any partnership, association, joint venture or other entity in which such Person and/or one or more Subsidiaries of such Person has more than a 50% equity interest at the time. "Subsidiary Guarantee" shall have the meaning provided in Section 5.08. "Subsidiary Pledge Agreement" shall have the meaning provided in Section 5.09. "Subsidiary Security Agreement" shall have the meaning provided in Section 5.10. "Supermajority Banks" shall mean Non-Defaulting Banks the sum of whose outstanding Term Loans represent an amount greater than 66 2/3% of outstanding Term Loans of Non-Defaulting Banks. "Supplemental Indenture" shall have the meaning provided in the definition of Indenture Amendment. "Swapped Station" shall have the meaning provided in Section 9.02(ix). "Syndication Agent" shall mean each of NationsBank of Texas, N.A. and Toronto Dominion (Texas), Inc., each in its capacity as Syndication Agent for the Banks hereunder. "Target Station" shall have the meaning provided in Section 9.02(ix). "Tax Sharing Agreement" shall have the meaning provided in Section 5.05. -124- 132 "Taxes" shall have the meaning provided in Section 4.04(a). "Tender Offer" shall mean (i) the Borrower's offer to purchase, in accordance with all applicable laws and the terms of the Tender Offer Documents, all of its outstanding 12 1/2% Senior Subordinated Notes due 2004 issued pursuant to the Existing Senior Subordinated Note Indenture (the "Repurchased Notes") and (ii) the valid tender of Repurchased Notes to the Borrower (and actual purchase by the Borrower thereof) of more than $30,001,000 in aggregate principal amount of Repurchased Notes. "Tender Offer Documents" shall mean the Offer to Purchase and Consent Solicitation Statement and the Supplemental Indenture. "Term Loan" shall have the meaning provided in Section 1.01(a). "Term Loan Commitment" shall mean for each Bank the amount set forth opposite such Bank's name in Schedule I hereto in the column entitled "Tenn Loan Commitment" as same may be (x) reduced from time to time pursuant to Sections 3.03, 4.02 and/or 10 or (y) adjusted from time to time as a result of assignments to or from such Bank pursuant to Section 1.13 or 13.04(b). "Term Loan Conversion" shall have the meaning set forth in Section 1.01(a). "Term Notes" shall have the meaning provided in Section 1.05(a). "Test Period" shall mean (i) for any determination made prior to June 30, 1998, the period from March 31, 1997 to the last day of the fiscal quarter then last ended and (ii) for any determination made thereafter, the four consecutive fiscal quarters then last ended (taken as one accounting period). "Total Commitment" shall mean the sum of the Total Term Loan Commitment and the Total Revolving Loan Commitment. "Total Revolving Loan Commitment" shall mean, at any time, the sum of the Revolving Loan Commitments of each of the Banks. "Total Supermajority Banks" shall mean Non-Defaulting Banks the sum of whose outstanding Term Loans and Revolving Commitments (or after the termination thereof, outstanding Revolving Loans and Adjusted RL Percentage or Letter of Credit Outstandings) represent an amount greater than 66-2/3% of outstanding Term Loans and Revolving Commitments (or after the termination thereof, outstanding Revolving -125- 133 Loans and Adjusted RL Percentage or Letter of Credit Outstandings) of Non-Defaulting Banks. "Total Term Loan Commitment" shall mean, at any time, the sum of the Term Loan Commitments of each Bank. "Total Unutilized Revolving Loan Commitment" shall mean, at any time, the sum of the Unutilized Revolving Loan Commitments of each of the Banks. "Trade Letter of Credit" shall have the meaning provided in Section 2.01 (a). "Tranche" shall mean the respective facility and commitments utilized in making Loans hereunder, with there being two separate Tranches, i.e., Term Loans and Revolving Loans. "Transaction" shall mean and include the Viacom Acquisition, the Indenture Amendment, the Tender Offer, the amendment and restatement of the Existing Credit Agreement and related guaranties and security documents as provided herein, the Loans incurred on the Second Restatement Effective Date and the payment of fees and expenses in connection with the foregoing. "Transaction Documents" shall mean the Tender Offer Documents, the Viacom Acquisition Documents, the Credit Documents and all other documents effectuating the Transaction or executed in connection therewith. "Trefoil" shall mean Trefoil Communications, Inc., a Delaware corporation. "12% Junior Exchange Debenture Indenture" shall mean that certain indenture dated as of the date of issuance of the 12% Junior Exchange Debentures, by and between the Borrower and the United States Trust Company of Texas, N.A., as trustee. "12% Junior Exchange Debentures" shall mean the Borrower's Subordinated Notes due 2009 issued pursuant to the 12% Junior Exchange Debenture Indenture. "12-1/4% Junior Exchange Debenture Indenture" shall I mean that certain indenture dated as of the date of issuance of the 12-1/4% Junior Exchange Debentures, by and between the Borrower and United States Trust Company of Texas, as trustee. 134 "12-1/4% Junior Exchange Debentures" shall mean the Borrower's Subordinated Notes due 2006 issued pursuant to the 12-1/4% Junior Exchange Debenture Indenture. "12-1/4% Senior Cumulative Preferred Stock" shall mean the Borrower's Series A Senior Cumulative Exchangeable Preferred Stock due 2008. "Type" shall mean the type of Loan determined with regard to the interest option applicable thereto, i.e., whether a Base Rate Loan or a Eurodollar Loan. "UCC" shall mean the Uniform Commercial Code as from time to time in effect in the relevant jurisdiction. "Unfunded Current Liability" of any Plan means the amount, if any, by which the actuarial present value of the accumulated benefits under the Plan as of the close of its most recent plan year, determined in accordance with Statement of Financial Accounting Standards No. 35, based upon the actuarial assumptions used by the Plan's actuary in the most recent annual valuation of the Plan, exceeds the fair market value of the assets allocable thereto, determined in accordance with Section 412 of the Code. "United States" and "U.S." shall each mean the United States of America. "Unpaid Drawing" shall have the meaning provided in Section 2.04(a). "Unutilized Revolving Loan Commitment" with respect to any Bank, at any time, shall mean such Bank's Revolving Loan Commitment at such time less the sum of (i) the aggregate outstanding principal amount of Revolving Loans made by such Bank plus (ii) such Bank's Adjusted RL Percentage of all Letter of Credit Outstandings. "Viacom" shall mean Viacom International, Inc. and its affiliates. "Viacom Acquisition" shall have the meaning provided in Section 5.07(a)(iv). "Viacom Acquisition Documents" shall mean the Viacom Joint Purchase Agreement, the Stock Purchase Agreement dated as of February 16, 1997 between Viacom and Evergreen Media of LA and all other agreements and documents relating to the Viacom Acquisition. "Viacom FCC Licenses" shall mean the FCC Licenses acquired by the Borrower pursuant to the Viacom Acquisition. -127- 135 "Viacom Joint Purchase Agreement" shall mean the Joint Purchase Agreement, dated as of February 19, 1997 by and among Holdings, the Borrower, Evergreen Media of LA and Evergreen. "Voting Stock" shall mean, as to any Person, any class or classes of capital stock of such Person pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the Board of Directors of such Person, or any class or classes of capital stock convertible into such stock at the option of the holders thereof. "WDRQ" shall mean WDRQ Inc., a Delaware corporation. "WDRQ Detroit Disposition" shall mean the sale of WDRQ to ABC for approximately $37,000,000 of gross cash proceeds subsequent to the Second Restatement Effective Date pursuant to the WDRQ Detroit Disposition Documents. "WDRQ Detroit Disposition Documents" shall mean the Asset Purchase Agreement dated as of April 11, 1997 between the Borrower and ABC. "Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any corporation 100% of whose capital stock (other than director's qualifying shares) is at the time owned by such Person and/or one or more Wholly-Owned Subsidiaries of such Person and (ii) any partnership, association, joint venture or other entity in which such Person and/or one or more Wholly-Owned Subsidiaries of such Person has a 100% equity interest at such time. Any reference to a Wholly-Owned Subsidiary, unless expressly to a Wholly-Owned Subsidiary of another Person, shall mean a Wholly-Owned Subsidiary of the Borrower. "WLIT" shall mean WLIT Inc., a Delaware corporation. SECTION 12. The Managing Agent. 12.01 Appointment. The Banks hereby designate BTCo as Managing Agent (for purposes of this Section 12, the term "Managing Agent" shall include BTCo in its capacity as Collateral Agent pursuant to the Security Documents) to act as specified herein and in the other Credit Documents. Each Bank hereby irrevocably authorizes, and each holder of any Note by the acceptance of such Note shall be deemed irrevocably to authorize, the Managing Agent to take such action on its behalf under the provisions of this Agreement, the other Credit Documents and any other instruments and agreements referred to herein or therein and to exercise such powers and to perform such duties hereunder and thereunder as are specifically delegated to or required of the Managing Agent by the terms hereof and thereof and such other powers as are -128- 136 reasonably incidental thereto. The Managing Agent may perform any of its duties hereunder by or through its respective officers, directors, agents, employees or affiliates. The Documentation Agent and Syndication Agent shall have no duties or liabilities in acting in such capacities hereunder. 12.02 Nature of Duties. The Managing Agent shall not have any duties or responsibilities except those expressly set forth in this Agreement and the Security Documents. Neither the Managing Agent nor any of its respective officers, directors, agents, employees or affiliates shall be liable for any action taken or omitted by it or them hereunder or under any other Credit Document or in connection herewith or therewith, unless caused by its or their gross negligence or willful misconduct. The duties of the Managing Agent shall be mechanical and administrative in nature; the Managing Agent shall not have by reason of this Agreement or any other Credit Document a fiduciary relationship in respect of any Bank or the holder of any Note; and nothing in this Agreement or any other Credit Document, expressed or implied, is intended to or shall be so construed as to impose upon the Managing Agent any obligations in respect of this Agreement or any other Credit Document except as expressly set forth herein or therein. 12.03 Lack of Reliance on the Managing Agent. Independently and without reliance upon the Managing Agent, each Bank and the holder of each Note, to the extent it deems appropriate, has made and shall continue to make (i) its own independent investigation of the financial condition and affairs of Holdings and its Subsidiaries in connection with the making and the continuance of the Loans and the taking or not taking of any action in connection herewith and (ii) its own appraisal of the creditworthiness of Holdings and its Subsidiaries and, except as expressly provided in this Agreement, the Managing Agent shall not have any duty or responsibility, either initially or on a continuing basis, to provide any Bank or the holder of any Note with any credit or other information with respect thereto, whether coming into its possession before the making of the Loans or at any time or times thereafter. The Managing Agent shall not be responsible to any Bank or the holder of any Note for any recitals, statements, information, representations or warranties herein or in any document, certificate or other writing delivered in connection herewith or for the execution, effectiveness, genuineness, validity, enforceability, perfection, collectibility, priority or sufficiency of this Agreement or any other Credit Document or the financial condition of Holdings and its Subsidiaries or be required to make any inquiry concerning either the performance or observance of any of the terms, provisions or conditions of this Agreement or any other Credit Document, or the financial condition of Holdings and its Subsidiaries or the existence or possible existence of any Default or Event of Default. 12.04 Certain Rights of the Managing Agent. If the Managing Agent shall request instructions from the Required Banks with respect to any act or action -129- 137 (including failure to act) in connection with this Agreement or any other Credit Document, the Managing Agent shall be entitled to refrain from such act or taking such action unless and until the Managing Agent shall have received instructions from the Required Banks; and the Managing Agent shall not incur liability to any Person by reason of so refraining. Without limiting the foregoing, neither any Bank nor the holder of any Note shall have any right of action whatsoever against the Managing Agent as a result of the Managing Agent acting or refraining from acting hereunder or under any other Credit Document in accordance with the instructions of the Required Banks. 12.05 Reliance. The Managing Agent shall be entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution, notice, statement, certificate, telex, teletype or telecopier message, cablegram, radiogram, order or other document or telephone message signed, sent or made by any Person that the Managing Agent believed to be the proper Person, and, with respect to all legal matters pertaining to this Agreement and any other Credit Document and its duties hereunder and thereunder, upon advice of counsel selected by the Managing Agent. 12.06 Indemnification. To the extent the Managing Agent is not reimbursed and indemnified by the Borrower, the Banks will reimburse and indemnify the Managing Agent, in proportion to their respective "percentages" as used in determining the Required Banks, for and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, judgments, costs, expenses or disbursements of whatsoever kind or nature which may be imposed on, asserted against or incurred by the Managing Agent in performing its respective duties hereunder or under any other Credit Document, in any way relating to or arising out of this Agreement or any other Credit Document; provided that no Bank shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from the Managing Agent's gross negligence or willful misconduct. 12.07 The Managing Agent in Its Individual Capacity. With respect to its obligation to make Loans under this Agreement, the Managing Agent shall have the rights and powers specified herein for a "Bank" and may exercise the same rights and powers as though it were not performing the duties specified herein; and the term "Banks," "Required Banks," "holders of Notes" or any similar terms shall, unless the context clearly otherwise indicates, include the Managing Agent in its individual capacity. The Managing Agent may accept deposits from, lend money to, and generally engage in any kind of banking, trust or other business with any Credit Party or any Affiliate of any Credit Party as if it were not performing the duties specified herein, and may accept fees and other consideration from the Borrower or any other Credit Party for services in connection with this Agreement and otherwise without having to account for the same to the Banks. -130- 138 12.08 Holders. The Managing Agent may deem and treat the payee of any Note as the owner thereof for all purposes hereof unless and until a written notice of the assignment, transfer or endorsement thereof, as the case may be, shall have been filed with the Managing Agent. Any request, authority or consent of any Person who, at the time of making such request or giving such authority or consent, is the holder of any Note shall be conclusive and binding on any subsequent holder, transferee, assignee or indorsee, as the case may be, of such Note or of any Note or Notes issued in exchange therefor. 12.09 Resignation by the Managing Agent. (a) The Managing Agent may resign from the performance of all its functions and duties hereunder and/or under the other Credit Documents at any time by giving 15 Business Days' prior written notice to the Borrower and the Banks. Such resignation shall take effect upon the appointment of a successor Managing Agent pursuant to clauses (b) and (c) below or as otherwise provided below. (b) Upon any such notice of resignation, the Banks shall appoint a successor Managing Agent hereunder or thereunder who shall be a commercial bank or trust company reasonably acceptable to the Borrower. (c) If a successor Managing Agent shall not have been so appointed within such 15 Business Day period, the Managing Agent, with the consent of the Borrower, shall then appoint a successor Managing Agent who shall serve as Managing Agent hereunder or thereunder until such time, if any, as the Banks appoint a successor Managing Agent as provided above. (d) If no successor Managing Agent has been appointed pursuant to clause (b) or (c) above by the 20th Business Day after the date such notice of resignation was given by the Managing Agent, the Managing Agent's resignation shall become effective and the Required Banks shall thereafter perform all the duties of the Managing Agent hereunder and/or under any other Credit Document until such time, if any, as the Banks appoint a successor Managing Agent as provided above. SECTION 13. Miscellaneous. 13.01 Payment of Expenses, etc. (a) The Borrower shall: (i) whether or not the transactions herein contemplated are consummated, pay all reasonable out-of-pocket costs and expenses of the Managing Agent (including, without limitation, the reasonable fees and disbursements of White & Case and local counsel) in connection with the preparation, execution and delivery of this Agreement and the other Credit Documents and the documents and instruments referred to herein and therein and any amendment, waiver or consent relating hereto or thereto, of the Managing Agent in -131- 139 connection with its syndication efforts with respect to this Agreement and of the Managing Agent and, following an Event of Default, each of the Banks in connection with the enforcement of this Agreement and the other Credit Documents and the documents and instruments referred to herein and therein (including, without limitation, the reasonable fees and disbursements of counsel for the Managing Agent and, following an Event of Default, for each of the Banks including any reasonable allocated costs of in-house counsel); (ii) pay and hold each of the Banks harmless from and against any and all present and future stamp, excise and other similar taxes with respect to the foregoing matters and save each of the Banks harmless from and against any and all liabilities with respect to or resulting from any delay or omission (other than to the extent attributable to such Bank) to pay such taxes; and (iii) indemnify the Managing Agent and each Bank, and each of their respective officers, directors, employees, representatives, trustees and agents from and hold each of them harmless against any and all liabilities, obligations (including removal or remedial actions), losses, damages, penalties, claims, actions, judgments, suits, costs, expenses and disbursements (including reasonable attorneys' and consultants' fees and disbursements) incurred by, imposed on or assessed against any of them as a result of, or arising out of, or in any way related to, or by reason of, (a) any investigation, litigation or other proceeding (whether or not the Managing Agent or any Bank is a party thereto) related to the entering into and/or performance of this Agreement or any other Credit Document or the use of any Letter of Credit or the proceeds of any Loans hereunder or the consummation of any transactions contemplated herein or in any of the Transaction Documents (including, without limitation, the Viacom Acquisition Documents and the Tender Offer Documents) or in any other Credit Document or the exercise of any of their rights or remedies provided herein or in the other Credit Documents, or (b) the non-compliance of any Real Property with foreign, federal, state and local laws, regulations, and ordinances (including applicable permits thereunder) applicable to any Real Property, (excluding Environmental Laws which are governed by the Amended and Restated Environmental Indemnity Agreement and the Environmental Indemnity Agreement) owned or at any time operated by Holdings or any of its Subsidiaries, including, in each case, without limitation, the reasonable fees and disbursements of counsel and other consultants incurred in connection with any such investigation, litigation or other proceeding (but excluding any losses, liabilities, claims, damages or expenses to the extent incurred by reason of the gross negligence or willful misconduct of the Person to be indemnified). To the extent that the undertaking to indemnify, pay or hold harmless the Managing Agent or any Bank set forth in the preceding sentence may be unenforceable because it is violative of any law or public policy, the Borrower shall make the maximum contribution to the payment and satisfaction of each of the indemnified liabilities which is permissible under applicable law. (b) Notwithstanding anything to the contrary contained in this Agreement, the indemnification provided for in this Section 13.01 shall not apply to -132- 140 Environmental Claims, Hazardous Materials or Releases, all of which shall be governed exclusively by the Amended and Restated Environmental Indemnity Agreement and the Environmental Indemnity Agreement. 13.02 Right of Setoff; Collateral Matters. (a) In addition to any rights now or hereafter granted under applicable law or otherwise, and not by way of limitation of any such rights, upon the occurrence of an Event of Default, each Bank is hereby authorized at any time or from time to time, without presentment, demand, protest or other notice of any kind to Holdings or the Borrower or to any other Person, any such notice being hereby expressly waived, to set off and to appropriate and apply any and all deposits (general or special) and any other Indebtedness at any time held or owing by such Bank (including, without limitation, by branches and agencies of such Bank wherever located) to or for the credit or the account of Holdings or the Borrower against and on account of the Obligations and liabilities of Holdings or the Borrower to such Bank under this Agreement or under any of the other Credit Documents, including, without limitation, all interests in Obligations purchased by such Bank pursuant to Section 13.06(b), and all other claims of any nature or description arising out of or connected with this Agreement or any other Credit Document, irrespective of whether or not such Bank shall have made any demand hereunder and although said Obligations, liabilities or claims, or any of them, shall be contingent or unmatured. (b) NOTWITHSTANDING THE FOREGOING SUBSECTION (a), AT ANY TIME THAT THE LOANS OR ANY OTHER OBLIGATION SHALL BE SECURED BY REAL PROPERTY LOCATED IN CALIFORNIA, NO BANK SHALL EXERCISE A RIGHT OF SETOFF, BANKER'S LIEN OR COUNTERCLAIM OR TAKE ANY COURT OR ADMINISTRATIVE ACTION OR INSTITUTE ANY PROCEEDING TO ENFORCE ANY PROVISION OF THIS AGREEMENT OR ANY NOTE THAT IS NOT TAKEN BY THE REQUIRED BANKS OR APPROVED IN WRITING BY THE REQUIRED BANKS IF SUCH SETOFF OR ACTION OR PROCEEDING WOULD OR MIGHT (PURSUANT TO SECTIONS 580a, 580b, 580d AND 726 OF THE CALIFORNIA CODE OF CIVIL PROCEDURE OR SECTION 2924 OF THE CALIFORNIA CIVIL CODE, IF APPLICABLE, OR OTHERWISE) AFFECT OR IMPAIR THE VALIDITY, PRIORITY, OR ENFORCEABILITY OF THE LIENS GRANTED TO THE COLLATERAL AGENT PURSUANT TO THE SECURITY DOCUMENTS OR THE ENFORCEABILITY OF THE NOTES AND OTHER OBLIGATIONS HEREUNDER, AND ANY ATTEMPTED EXERCISE BY ANY BANK OF ANY SUCH RIGHT WITHOUT OBTAINING SUCH CONSENT OF THE REQUIRED BANKS SHALL BE NULL AND VOID. THIS SUBSECTION (b) SHALL BE SOLELY FOR THE BENEFIT OF EACH OF THE MANAGING AGENT, THE COLLATERAL AGENT AND THE BANKS HEREUNDER AND SHALL NOT CREATE ANY RIGHTS FOR THE BENEFIT OF ANY CREDIT PARTY OR ANY OTHER PERSON. -133- 141 13.03 Notices. Except as otherwise expressly provided herein, all notices and other communications provided for hereunder shall be in writing (including telegraphic, telex, telecopier or cable communication) and mailed, telegraphed, telexed, telecopied, cabled or delivered: if to Holdings, at Holdings' address specified opposite its signature below; if to the Borrower, at the Borrower's address specified opposite its signature below; if to any Bank, at its address specified opposite its name below; and if to the Managing Agent, at its Notice Office; or, as to any Credit Party or the Managing Agent, at such other address as shall be designated by such party in a written notice to the other parties hereto and, as to each Bank, at such other address as shall be designated by such Bank in a written notice to the Borrower and the Managing Agent. All such notices and communications shall, when mailed, telegraphed, telexed, telecopied, or cabled or sent by overnight courier, be effective when deposited in the mails, delivered to the telegraph company, cable company or overnight courier, as the case may be, or sent by telex or telecopier, except that notices and communications to the Managing Agent and the Borrower shall not be effective until received by the Managing Agent or the Borrower, as the case may be. 13.04 Benefit of Agreement. (a) This Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective successors and assigns of the parties hereto; provided, however, no Credit Party may assign or transfer any of its rights, obligations or interest hereunder or under any other Credit Document without the prior written consent of the Banks and, provided further, that, although any Bank may transfer, assign or grant participations in its rights hereunder, such Bank shall remain a "Bank" for all purposes hereunder (and may not transfer or assign all or any portion of its Commitments hereunder except as provided in Section 13.04(b)) and the transferee, assignee or participant, as the case may be, shall not constitute a "Bank" hereunder and, provided further, that no Bank shall transfer or grant any participation under which the participant shall have rights to approve any amendment to or waiver of this Agreement or any other Credit Document except to the extent such amendment or waiver would (i) extend the final scheduled maturity of any Loan, Note or Letter of Credit (unless such Letter of Credit is not extended beyond the Maturity Date) in which such participant is participating, or reduce the rate or extend the time of payment of interest or Fees thereon (except in connection with a waiver of applicability of any postdefault increase in interest rates) or reduce the principal amount thereof, or increase the amount of the participant's participation over the amount thereof then in effect (it being understood that a waiver of any Default or Event of Default or of a mandatory reduction in the Total Commitment shall not constitute a change in the terms of such participation, and that an increase in any Commitment or Loan and an increase in the available portion of any Commitment of any Bank shall be permitted without the consent of any participant if the participant's participation is not increased as a result thereof), (ii) consent to the assignment or transfer by the Borrower of any of its rights and obligations under this Agreement or (iii) release all or substantially all of the -134- 142 Collateral under all of the Security Documents (except as expressly provided in the Credit Documents) supporting the Loans hereunder in which such participant is participating. In the case of any such participation, the participant shall not have any rights under this Agreement or any of the other Credit Documents (the participant's rights against such Bank in respect of such participation to be those set forth in the agreement executed by such Bank in favor of the participant relating thereto) and all amounts payable by the Borrower hereunder shall be determined as if such Bank had not sold such participation. (b) Notwithstanding the foregoing, any Bank (or any Bank together with one or more other Banks) may (x) assign all or a portion of its Commitments (and related outstanding Obligations hereunder) and/or its outstanding Term Loans to (i) its parent company and/or any affiliate of such Bank which is at least 50% owned by such Bank or its parent company or to one or more Banks or (ii) in the case of any Bank that is a fund that invests in bank loans, any other fund that invests in bank loans and is managed by the same investment advisor of such Bank or by an Affiliate of such investment advisor or (y) assign all, or if less than all, a portion equal to at least $5,000,000 in the aggregate for the assigning Bank or assigning Banks, of such Revolving Loan Commitments and outstanding principal amount of Term Loans hereunder to one or more Eligible Transferees (treating any fund that invests in bank loans and any other fund that invests in bank loans and is managed by the same investment advisor of such fund or by an Affiliate of such investment advisor as a single Eligible Transferee), each of which assignees shall become a party to this Agreement as a Bank by execution of an Assignment and Assumption Agreement, provided that, (i) at such time Schedule I shall be deemed modified to reflect the Commitments (and/or outstanding Term Loans, as the case may be) of such new Bank and of the existing Banks, (ii) upon surrender of the old Notes, new Notes will be issued, at the Borrower's expense, to such new Bank and to the assigning Bank, such new Notes to be in conformity with the requirements of Section 1.05 (with appropriate modifications) to the extent needed to reflect the revised Commitments (and/or outstanding Term Loans, as the case may be), (iii) the consent of the Managing Agent shall be required in connection with any such assignment (which consent shall not be unreasonably withheld) and (iv) the Managing Agent shall receive at the time of each such assignment, from the assigning or assignee Bank, the payment of a non-refundable assignment fee of $3,500 and, provided further, that such transfer or assignment will not be effective until recorded by the Managing Agent on the Register pursuant to Section 13.17 hereof. To the extent of any assignment pursuant to this Section 13.04(b), the assigning Bank shall be relieved of its obligations hereunder with respect to its assigned Commitments. At the time of each assignment pursuant to this Section 13.04(b) to a Person which is not already a Bank hereunder and which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for Federal income tax purposes, the respective assignee Bank shall provide to the Borrower and -135- 143 the Managing Agent the appropriate Internal Revenue Service Forms (and, if applicable a Section 4.04(b)(ii) Certificate) described in Section 4.04(b). To the extent that an assignment of all or any portion of a Bank's Commitments and related outstanding Obligations pursuant to Section 1.13 or this Section 13.04(b) would, at the time of such assignment, result in increased costs under Section 1.10, 1.11, 2.05 or 4.04 from those being charged by the respective assigning Bank prior to such assignment, then the Borrower shall not be obligated to pay such increased costs (although the Borrower shall be obligated to pay any other increased costs of the type described above resulting from changes after the date of the respective assignment). (c) Nothing in this Agreement shall prevent or prohibit any Bank from pledging its Loans and Notes hereunder to a Federal Reserve Bank in support of borrowings made by such Bank from such Federal Reserve Bank and, with the consent of the Agent, any Bank which is a fund may pledge all or any portion of its Loans and Notes to its trustee in support of its obligations to its trustee. No pledge pursuant to this clause (c) shall release the transferor Bank from any of its obligations hereunder. 13.05 No Waiver; Remedies Cumulative. No failure or delay on the part of the Managing Agent or any Bank or any holder of any Note in exercising any right, power or privilege hereunder or under any other Credit Document and no course of dealing between the Borrower or any other Credit Party and the Managing Agent or any Bank or the holder of any Note shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or under any other Credit Document preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder or thereunder. The rights, powers and remedies herein or in any other Credit Document expressly provided are cumulative and not exclusive of any rights, powers or remedies which the Managing Agent or any Bank or the holder of any Note would otherwise have. No notice to or demand on any Credit Party in any case shall entitle any Credit Party to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the Managing Agent or any Bank or the holder of any Note to any other or further action in any circumstances without notice or demand. 13.06 Payments Pro Rata. (a) Except as otherwise provided in this Agreement, the Managing Agent agrees that promptly after its receipt of each payment from or on behalf of the Borrower in respect of any Obligations hereunder, it shall distribute such payment to the Banks (other than any Bank that has consented in writing to waive its pro rata share of any such payment) pro rata based upon their respective shares, if any, of the Obligations with respect to which such payment was received. (b) Each of the Banks agrees that, if it should receive any amount hereunder (whether by voluntary payment, by realization upon security, by the exercise -136- 144 of the right of setoff or banker's lien, by counterclaim or cross action, by the enforcement of any right under the Credit Documents, or otherwise), which is applicable to the payment of the principal of, or interest on, the Loans, Unpaid Drawings, Commitment Commission or Letter of Credit Fees, of a sum which with respect to the related sum or sums received by other Banks is in a greater proportion than the total of such Obligation then owed and due to such Bank bears to the total of such Obligation then owed and due to all of the Banks immediately prior to such receipt, then such Bank receiving such excess payment shall purchase for cash without recourse or warranty from the other Banks an interest in the Obligations of the respective Credit Party to such Banks in such amount as shall result in a proportional participation by all the Banks in such amount; provided that if all or any portion of such excess amount is thereafter recovered from such Bank, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest. (c) Notwithstanding anything to the contrary contained herein, the provisions of the preceding Sections 13.06(a) and (b) shall be subject to the express provisions of this Agreement which require, or permit, differing payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks. 13.07 Calculations; Computations. (a) The financial statements to be furnished to the Banks pursuant hereto shall be made and prepared in accordance with generally accepted accounting principles in the United States consistently applied throughout the periods involved (except as set forth in the notes thereto or as otherwise disclosed in writing by the Borrower to the Banks); provided that, except as otherwise specifically provided herein, all computations of Excess Cash Flow and all computations determining compliance with Sections 9.07 through 9.10, inclusive, shall utilize accounting principles and policies in conformity with those used to prepare the historical financial statements delivered to the Banks pursuant to Section 7.05(a) (with the foregoing generally accepted accounting principles, subject to the preceding proviso, herein called "GAAP"). (b) All computations of interest, Commitment Commission and Fees hereunder shall be made on the basis of a year of 360 days for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest, Commitment Commission or Fees are payable. 13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS OTHERWISE PROVIDED IN CERTAIN OF THE MORTGAGES, BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF -137- 145 THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS BILL EDWARDS, THE VICE PRESIDENT AND GENERAL MANAGER AT WALK=AM/FM, 66 COLONIAL DRIVE, PATCHOGUE, NEW YORK 11772 AS ITS DESIGNEE, APPOINTEE AND AGENT TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND ON ITS BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. IF FOR ANY REASON SUCH DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO ACT AS SUCH, EACH CREDIT PARTY AGREES TO DESIGNATE A NEW DESIGNEE, APPOINTEE AND AGENT IN NEW YORK CITY ON THE TERMS AND FOR THE PURPOSES OF THIS PROVISION SATISFACTORY TO THE MANAGING AGENT UNDER THIS AGREEMENT. EACH OF HOLDINGS AND THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO ANY CREDIT PARTY AT ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE MANAGING AGENT UNDER THIS AGREEMENT, ANY BANK OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY CREDIT PARTY IN ANY OTHER JURISDICTION. (b) EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES -138- 146 NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. (c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. 13.09 Counterparts. This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. A set of counterparts executed by all the parties hereto shall be lodged with the Borrower and the Managing Agent. 13.10 Effectiveness. (a) This Agreement shall become effective on the date (the "Second Restatement Effective Date") on which (i) each of the Borrower, each Agent, each Continuing Bank and each New Bank shall have signed a counterpart hereof (whether the same or different counterparts) and shall have delivered (including by way of facsimile device) the same to the Managing Agent at its Notice Office and (ii) the conditions contained in Sections 5, 6 and 13.10(b) are met to the satisfaction of the Managing Agent and the Required Banks (determined immediately after the occurrence of the Second Restatement Effective Date). Unless the Managing Agent has received actual notice from any Bank that the conditions contained in Sections 5 and 6 have not been met to its satisfaction, upon the satisfaction of the condition described in clause (i) of the immediately preceding sentence and upon the Managing Agent's good faith determination that the conditions described in clause (ii) of the immediately preceding sentence have been met, then the Second Restatement Effective Date shall have been deemed to have occurred, regardless of any subsequent determination that one or more of the conditions thereto had not been met (although the occurrence of the Second Restatement Effective Date shall not release the Borrower from any liability for failure to satisfy one or more of the applicable conditions contained in Section 5 or 6). The Managing Agent will give the Borrower and each Bank prompt written notice of the occurrence of the Second Restatement Effective Date. (b) On the Second Restatement Effective Date, each New Bank and each Continuing Bank shall have delivered to the Managing Agent for the account of the Borrower an amount equal to (i) in the case of each New Bank, the Term Loans and Revolving Loans to be made by such New Bank on the Second Restatement Effective Date and (ii) in the case of each Continuing Bank, the amount by which the principal amount of Loans to be made and/or converted by such Continuing Bank on the Second -139- 147 Restatement Effective Date exceeds the amount of the Existing Loans of such Continuing Bank outstanding on the Second Restatement Effective Date. Notwithstanding anything to the contrary contained in this Section 13.10(b), in satisfying the foregoing condition, unless the Managing Agent shall have been notified by any Bank prior to the occurrence of the Second Restatement Effective Date that such Bank does not intend to make available to the Managing Agent such Bank's Term Loans and Revolving Loans required to be made by it on such date, then the Managing Agent may, in reliance on such assumption, make available to the Borrower the corresponding amounts in accordance with the provisions of Section 1.04 of this Agreement, and the making available by the Managing Agent of such amounts shall satisfy the condition contained in this Section 13.10(b). 13.11 Headings Descriptive. The headings of the several sections and subsections of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement. 13.12 Amendment or Waiver; etc. (a) Neither this Agreement nor any other Credit Document nor any terms hereof or thereof may be changed, waived, discharged or terminated unless such change, waiver, discharge or termination is in writing signed by the respective Credit Parties party thereto and the Required Banks, provided that no such change, waiver, discharge or termination shall, without the consent of each Bank (other than a Defaulting Bank) (with Obligations being directly affected), (i) extend the final scheduled maturity, or Scheduled Repayment of any Loan or Note or extend the stated maturity of any Letter of Credit beyond July 2, 2004, or reduce the rate or extend the time of payment of interest or Fees thereon (except in connection with a waiver of applicability of any post-default increase in interest rates), or reduce the principal amount thereof (except to the extent repaid in cash), (ii) release all or substantially all of the Collateral (except as expressly provided in the Credit Documents) under all the Security Documents, (iii) amend, modify or waive any provision of this Section 13.12, (iv) reduce the percentage specified in the definition of Required Banks (it being understood that, with the consent of the Required Banks, additional extensions of credit pursuant to this Agreement may be included in the determination of the Required Banks on substantially the same basis as the extensions of Term Loans and Revolving Loan Commitments are included on the Second Restatement Effective Date) or (v) consent to the assignment or transfer by the Borrower of any of its rights and obligations under this Agreement; provided further, that no such change, waiver, discharge or termination shall (u) increase the Commitments of any Bank over the amount thereof then in effect without the consent of such Bank (it being understood that waivers or modifications of conditions precedent, covenants, Defaults or Events of Default or of a mandatory reduction in the Total Commitment shall not constitute an increase of the Commitment of any Bank, and that an increase in the available portion of any Commitment of any Bank shall not constitute an increase in the Commitment of -140- 148 such Bank), (v) without the consent of the Managing Agent and each other Issuing Bank, amend, modify or waive any provision of Section 2 or alter its rights or obligations with respect to Letters of Credit, (w) without the consent of the Managing Agent, amend, modify or waive any provision of Section 12 as same applies to such Managing Agent or any other provision as same relates to the rights or obligations of such Managing Agent, (x) without the consent of the Collateral Agent, amend, modify or waive, any provision relating to the rights or obligations of the Collateral Agent, (y) without the consent of the Supermajority Banks, amend, modify or waive the definition of Supermajority Banks or this clause (y), and (z) without the consent of the Total Supermajority Banks, amend, modify or waive Section 9.04(xii) or 9.04(xiii), reduce the percentage specified in the definition of Total Supermajority Banks (it being understood that, with the consent of the Total Supermajority Banks, additional extensions of credit pursuant to this Agreement may be included in the determination of the Total Supermajority Banks on substantially the same basis as the extensions of Term Loans and Revolving Loan Commitments are included on the Second Restatement Effective Date) or this clause (z). Notwithstanding anything to the contrary contained herein, the Managing Agent may enter into documentation (including any changes to this Agreement or the other Credit Documents) necessary to effect the increase in the Total Revolving Commitment pursuant to Section 9.04(xiv). (b) If, in connection with any proposed change, waiver, discharge or termination to any of the provisions of this Agreement as contemplated by clauses (i) through (v), inclusive, of the first proviso to Section 13.12(a), the consent of the Required Banks is obtained but the consent of one or more of such other Banks whose consent is required is not obtained, then the Borrower shall have the right, so long as all non-consenting Banks are treated as described in clauses (A) or (B) below, to either (A) replace each such non-consenting Bank or Banks with one or more Replacement Banks pursuant to Section 1.13 so long as at the time of such replacement, each such Replacement Bank consents to the proposed change, waiver, discharge or termination or (B) terminate such non-consenting Bank's Revolving Loan Commitment and repay its Loans, in accordance with Sections 3.02(b) and 4.01(v), respectively, provided that in any event the Borrower shall not have the right to replace a Bank, terminate its Revolving Loan Commitment or repay its Loans solely as a result of the exercise of such Bank's rights ("and the withholding of any required consent by such Bank) pursuant to the second proviso to Section 13.12(a). 13.13 Survival. All indemnities set forth herein including, without limitation, in Sections 1.10, 1.11, 2.05, 4.04, 12.06 and 13.01 shall, subject to Section 13.15 (to the extent applicable), survive the execution, delivery and termination of this Agreement and the Notes the making and repayment of the Loans and the assignment by any Bank of its Commitment in accordance with Section 13.04(b). -141- 149 13.14 Domicile of Loans. Each Bank may transfer and carry its Loans at, to or for the account of any office, Subsidiary or Affiliate of such Bank. Notwithstanding anything to the contrary contained herein, to the extent that a transfer of Loans pursuant to this Section 13.14 would, at the time of such transfer, result in increased costs under Section 1.10, 1.11, 2.05 or 4.04 from those being charged by the respective Bank prior to such transfer, then the Borrower shall not be obligated to pay such increased costs (although the Borrower shall be obligated to pay any other increased costs of the type described above resulting from changes giving rise to such increased costs after the date of the respective transfer). 13.15 Limitation on Additional Amounts, etc. Notwithstanding anything to the contrary contained in Section 1.10, 1.11, 2.05 or 4.04 of this Agreement, unless a Bank gives notice to the Borrower that it is obligated to pay an amount under the respective Section within one year after the later of (x) the date the Bank incurs the respective increased costs, Taxes, loss, expense or liability, reduction in amounts received or receivable or reduction in return on capital or (y) the date such Bank has actual knowledge of its incurrence of the respective increased costs, Taxes, loss, expense or liability, reductions in amounts received or receivable or reduction in return on capital, then such Bank shall only be entitled to be compensated for such amount by the Borrower pursuant to said Section 1.10, 1.11, 2.05 or 4.04, as the case may be, to the extent the costs, Taxes, loss, expense or liability, reduction in amounts received or receivable or reduction in return on capital are incurred or suffered on or after the date which occurs one year prior to such Bank giving notice to the Borrower that it is obligated to pay the respective amounts pursuant to said Section 1.10, 1.11, 2.05 or 4.04, as the case may be. This Section 13.15 shall have no applicability to any Section of this Agreement other than said Sections 1.10, 1.11, 2.05 and 4.04. 13.16 Confidentiality. (a) Subject to the provisions of clause (b) of this Section 13.16, each Bank agrees that it will use its best efforts not to disclose without the prior consent of Holdings or the Borrower (other than to its employees, auditors, advisors or counsel or to another Bank if the Bank or such Bank's holding or parent company in its sole discretion determines that any such party should have access to such information, provided such Persons shall be subject to the provisions of this Section 13.16 to the same extent as such Bank) any information with respect to Holdings or any of its Subsidiaries which is now or in the future furnished pursuant to this Agreement or any other Credit Document and which is designated by Holdings to the Banks in writing as confidential, provided that any Bank may disclose any such information (a) as has become generally available to the public, (b) as may be required or appropriate in any report, statement or testimony submitted to any municipal, state or Federal regulatory body having or claiming to have jurisdiction over such Bank or to the Federal Reserve Board or the Federal Deposit Insurance Corporation or similar organizations (whether in the United States or elsewhere) or their successors, (c) as may be -142- 150 required or appropriate in respect to any summons or subpoena or in connection with any litigation, (d) in order to comply with any law, order, regulation or ruling applicable to such Bank, (e) to the Managing Agent or the Collateral Agent and (f) to any prospective or actual transferee or participant in connection with any contemplated transfer or participation of any of the Notes or Commitments or any interest therein by such Bank or to any direct or indirect contractual counterparties in swap agreements or such contractual counterparties' professional advisors, provided that such prospective transferee, swap counterparty or swap counterparty's professional advisor agrees to abide by the provisions of this Section 13.16. (b) Each of Holdings and the Borrower hereby acknowledges and agrees that each Bank may share with any of its affiliates any information related to Holdings or any of its Subsidiaries (including, without limitation, any nonpublic customer information regarding the creditworthiness of Holdings and its Subsidiaries, provided such Persons shall be subject to the provisions of this Section 13.16 to the same extent as such Bank). 13.17 Register. The Borrower hereby designates the Managing Agent to serve as the Borrower's agent, solely for purposes of this Section 13.17, to maintain a register (the "Register") on which it will record the Commitments from time to time of each of the Banks, the Loans made by each of the Banks and each repayment in respect of the principal amount of the Loans of each Bank. Failure to make any such recordation, or any error in such recordation shall not affect the Borrower's obligations in respect of such Loans. With respect to any Bank, the transfer of the Commitments of such Bank and the rights to the principal of, and interest on, any Loan made pursuant to such Commitments shall not be effective until such transfer is recorded on the Register maintained by the Managing Agent with respect to ownership of such Commitments and Loans and prior to such recordation all amounts owing to the transferor with respect to such Commitments and Loans shall remain owing to the transferor. The registration of assignment or transfer of all or part of any Commitments and Loans shall be recorded by the Managing Agent on the Register only upon the acceptance by the Managing Agent of a properly executed and delivered Assignment and Assumption Agreement pursuant to Section 13.04(b). Coincident with the delivery of such an Assignment and Assumption Agreement to the Managing Agent for acceptance and registration of assignment or transfer of all or part of a Loan, or as soon thereafter as practicable, the assigning or transferor Bank shall surrender the Note evidencing such Loan, and thereupon one or more new Notes in the same aggregate principal amount shall be issued to the assigning or transferor Bank and/or the new Bank. The Borrower agrees to indemnify the Managing Agent from and against any and all losses, claims, damages and liabilities of whatsoever nature which may be imposed on, asserted against or incurred by the Managing Agent in performing its duties under this Section 13-17. -143- 151 13.18 Additions of New Banks; Conversion of Existing Loans of Continuing Banks; Termination of Commitments of Non-Continuing Banks. (a) On and as of the occurrence of the Second Restatement Effective Date in accordance with Section 13.10 hereof, each New Bank shall become a "Bank" under, and for all purposes of, this Agreement and the other Credit Documents. (b) The parties hereto acknowledge that each Existing Bank has been offered the opportunity to participate in this Agreement, after the occurrence of the Second Restatement Effective Date, as a Continuing Bank hereunder, but that no Existing Bank is obligated to be a Continuing Bank. (c) Notwithstanding anything to the contrary contained in the Existing Credit Agreement, this Agreement or any other Credit Document, the Borrower and each of the Banks hereby agree that on the Second Restatement Effective Date, (i) each Bank with a Commitment as set forth on Schedule I (after giving effect to the Second Restatement Effective Date) shall make or maintain (including by way of conversion) that principal amount of Term Loans and/or Revolving Loans to the Borrower as is required by Section 1.01, provided that if the Existing Loans of any Continuing Bank outstanding on the Second Restatement Effective Date (immediately before giving effect thereto) exceed the aggregate principal amount of Loans required to be made available by such Bank on such date (after giving effect to the Second Restatement Effective Date), then Existing Loans of such Continuing Bank in an amount equal to such excess shall be repaid on the Second Restatement Effective Date, together with interest thereon, to such Continuing Bank and (ii) in the case of each Non-Continuing Bank, all of such Non-Continuing Bank's Existing Loans outstanding on the Second Restatement Effective Date shall be repaid in full on such date, together with interest thereon and all accrued Fees (and any other amounts) owing to such Non-Continuing Bank, and the Term Loan Commitment and/or Revolving Loan Commitment (under, and as defined in, the Existing Credit Agreement) of such Non-Continuing Bank, if any, shall be terminated, effective upon the occurrence of the Second Restatement Effective Date. Notwithstanding anything to the contrary contained in the Existing Credit Agreement, this Agreement or any other Credit Document, the parties hereto consent to the repayments and reductions required above, and agree that in the event that any Existing Bank shall fail to execute a counterpart of this Agreement prior to the occurrence of the Second Restatement Effective Date, such Existing Bank shall be deemed to be a Non-Continuing Bank and, concurrently with the occurrence of the Second Restatement Effective Date, the Revolving Loan Commitment (under, and as defined in, the Existing Credit Agreement) of such Existing Bank, if any, shall be terminated, all Existing Loans of such Existing Bank outstanding on the Second Restatement Effective Date shall be repaid in full, together with interest thereon and all accrued Fees (as defined in the Existing Credit Agreement) (and any other amounts) owing to such Existing Bank under the Existing Credit Agreement, and concurrently with the occurrence of the -144- 152 Second Restatement Effective Date, such Existing Bank shall no longer constitute a "Bank" under this Agreement and the other Credit Documents, provided that all indemnities of the Credit Parties under the Existing Credit Agreement and the other Credit Documents (as in effect prior to the Second Restatement Effective Date) for the benefit of such Existing Bank shall survive in accordance with the terms thereof. SECTION 14. Holdings Guaranty. 14.01 The Guaranty. In order to induce the Banks to enter into this Agreement and to extend credit hereunder and in recognition of the direct benefits to be received by Holdings from the proceeds of the Loans and the issuance of the Letters of Credit and to induce the Banks or any of their respective Affiliates to enter into Interest Rate Protection Agreements, Holdings hereby agrees with the Banks as follows: Holdings hereby unconditionally and irrevocably guarantees as primary obligor and not merely as surety the full and prompt payment when due, whether upon maturity, by acceleration or otherwise, of any and all of the Guaranteed Obligations of the Borrower to the Secured Creditors. If any or all of the Guaranteed Obligations of the Borrower to the Secured Creditors becomes due and payable hereunder, Holdings unconditionally promises to pay such indebtedness to the Secured Creditors, or order, on demand, together with any and all reasonable expenses which may be incurred by the Managing Agent or the Secured Creditors in collecting any of the Guaranteed Obligations. 14.02 Bankruptcy. Additionally, Holdings unconditionally and irrevocably guarantees the payment of any and all of the Guaranteed Obligations of the Borrower to the Secured Creditors whether or not then due or payable by the Borrower upon the occurrence in respect of the Borrower of any of the events specified in Section 10.05, and unconditionally and irrevocably promises to pay such Guaranteed Obligations to the Secured Creditors, or order, on demand, in lawful money of the United States. 14.03 Nature of Liability. The liability of Holdings hereunder is exclusive and independent of any security for or other guaranty of the Guaranteed Obligations of the Borrower whether executed by Holdings, any other guarantor or by any other party, and the liability of Holdings hereunder shall not be affected or impaired by (a) any direction as to application of payment by the Borrower or by any other party, or (b) any other continuing or other guaranty, undertaking or maximum liability of a guarantor or of any other party as to the Guaranteed Obligations of the Borrower, or (c) any payment on or in reduction of any such other guaranty or undertaking, or (d) any dissolution, termination or increase, decrease or change in personnel by the Borrower, or (e) any payment made to the Managing Agent or the Secured Creditors on the indebtedness which the Managing Agent or such Secured Creditors repay the Borrower pursuant to court order in any bankruptcy, reorganization, arrangement, mora- -145- 153 torium or other debtor relief proceeding, and Holdings waives any right to the deferral or modification of its obligations hereunder by reason of any such proceeding. 14.04 Independent Obligation. The obligations of Holdings hereunder are independent of the obligations of any other guarantor or the Borrower, and a separate action or actions may be brought and prosecuted against Holdings whether or not action is brought against any other guarantor or the Borrower and whether or not any other guarantor or the Borrower be joined in any such action or actions. Holdings waives, to the fullest extent permitted by law, the benefit of any statute of limitations affecting its liability hereunder or the enforcement thereof. Any payment by the Borrower or other circumstance which operates to toll any statute of limitations as to the Borrower shall operate to toll the statute of limitations as to Holdings. This Guaranty is a continuing one and all liabilities to which it applies or may apply under the terms hereof shall be conclusively presumed to have been created in reliance hereon. 14.05 Authorization. Holdings authorizes the Managing Agent and the Secured Creditors without notice or demand (except as shall be required by applicable statute and cannot be waived), and without affecting or impairing its liability hereunder, from time to time to: (a) change the manner, place or terms of payment of, and/or change or extend the time of payment of, renew, increase, accelerate or alter, any of the Guaranteed Obligations (including any increase or decrease in the rate of interest thereon), any security therefor, or any liability incurred directly or indirectly in respect thereof, and the Guaranty herein made shall apply to the Guaranteed Obligations as so changed, extended, renewed or altered; (b) take and hold security for the payment of the Guaranteed Obligations and sell, exchange, release, surrender, realize upon or otherwise deal with in any manner and in any order any property by whomsoever at any time pledged or mortgaged to secure, or howsoever securing, the Guaranteed Obligations or any liabilities (including any of those hereunder) incurred directly or indirectly in respect thereof or hereof, and/or any offset there against; (c) exercise or refrain from exercising any rights against the Borrower or others or otherwise act or refrain from acting; (d) release or substitute any one or more endorsers, guarantors, the Borrower or other obligors; (e) settle or compromise any of the Guaranteed Obligations, any security therefor or any liability (including any of those hereunder) incurred directly or -146- 154 indirectly in respect thereof or hereof, and may subordinate the payment of all or any part thereof to the payment of any liability (whether due or not) of the Borrower to its creditors other than the Banks; (f) apply any sums by whomsoever paid or howsoever realized to any liability or liabilities of the Borrower to the Secured Creditors regardless of what liability or liabilities of Holdings or the Borrower remain unpaid; (g) consent to or waive any breach of, or any act, omission or default under, this Agreement or any of the instruments or agreements referred to herein, or otherwise amend, modify or supplement this Agreement or any of such other instruments or agreements; and/or (h) take any other action which would, under otherwise applicable principles of common law, give rise to a legal or equitable discharge of Holdings from its liabilities under the Holdings Guaranty. 14.06 Reliance. It is not necessary for the Managing Agent or the Secured Creditors to inquire into the capacity or powers of the Borrower or its Subsidiaries or the officers, directors, partners or agents acting or purporting to act on its behalf, and any Guaranteed Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder. 14.07 Subordination. Any of the indebtedness of the Borrower relating to the Guaranteed Obligations now or hereafter owing to Holdings is hereby subordinated to the Guaranteed Obligations of the Borrower owing to the Managing Agent and the Secured Creditors; and if the Managing Agent so requests at a time when an Event of Default exists, all such indebtedness relating to the Guaranteed Obligations of the Borrower to Holdings shall be collected, enforced and received by Holdings for the benefit of the Secured Creditors and be paid over to the Managing Agent on behalf of the Secured Creditors on account of the Guaranteed Obligations of the Borrower to the Secured Creditors, but without affecting or impairing in any manner the liability of Holdings under the other provisions of this Guaranty. Prior to the transfer by Holdings of any note or negotiable instrument evidencing any of the indebtedness relating to the Guaranteed Obligations of the Borrower to Holdings, Holdings shall mark such note or negotiable instrument with a legend that the same is subject to this subordination. The provisions of this Section 14.07 (and any claims of Holdings as described above) are subject to the provisions of Section 14.08(c) and (d). 14.08 Waiver. (a) Holdings waives any right (except as shall be required by applicable statute and cannot be waived) to require the Managing Agent or the Secured Creditors to (1) proceed against the Borrower, any other guarantor or any -147- 155 other party, (ii) proceed against or exhaust any security held from the Borrower, any other guarantor or any other party or (iii) pursue any other remedy in the Managing Agent's or the Secured Creditors' power whatsoever. Holdings waives any defense based on or arising out of any defense of the Borrower, any other guarantor or any other party, other than payment in full of the Guaranteed Obligations, based on or arising out of the disability of the Borrower, any other guarantor or any other party, or the unenforceability of the Guaranteed Obligations or any part thereof from any cause, or the cessation from any cause of the liability of the Borrower other than payment in full of the Guaranteed Obligations. The Managing Agent and the Secured Creditors may, at their election, foreclose on any security held by the Managing Agent, the Collateral Agent or the Secured Creditors by one or more judicial or nonjudicial sales, whether or not every aspect of any such sale is commercially reasonable (to the extent such sale is permitted by applicable law, including, but not limited to, the Communications Act), or exercise any other right or remedy the Managing Agent and the Secured Creditors may have against the Borrower or any other party, or any security, without affecting or impairing in any way the liability of Holdings hereunder except to the extent the Guaranteed Obligations have been paid. Holdings waives any defense arising out of any such election by the Managing Agent and the Secured Creditors, even though such election operates to impair or extinguish any right of reimbursement or subrogation or other right or remedy of Holdings against any Borrower or any other party or any security. (b) Holdings waives all presentments, demands for performance, protests and notices, including without limitation notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation or incurring of new or additional Guaranteed Obligations. Holdings assumes all responsibility for being and keeping itself informed of the Borrower's financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations and the nature, scope and extent of the risks which Holdings assumes and incurs hereunder, and agrees that the Managing Agent and the Secured Creditors shall have no duty to advise Holdings of information known to them regarding such circumstances or risks. (c) Holdings understands that to the extent the Guaranteed Obligations are secured by Real Property, Holdings shall be liable for the full amount of the liability hereunder notwithstanding foreclosure on any such Real Property by trustee sale or any other reason impairing Holdings' or any secured creditors' right to proceed against the Borrower. Holdings hereby waives, to the fullest extent permitted by applicable laws, all rights and benefits under Sections 580a, 580b, 580d and 726 of the California Code of Civil Procedure. In addition, Holdings hereby waives, to the fullest extent permitted by applicable laws, without limiting the generality of the foregoing or any other provision hereof, all rights and benefits which might otherwise be available -148- 156 to Holdings under California Civil Code Sections 2787 through 2855 inclusive, 2899 and 3433. (d) Holdings understands, is aware and hereby acknowledges that if the Banks elect to foreclose on any of the Mortgaged Property security nonjudicially, any right of subrogation of Holdings against the Borrower may be impaired or extinguished and that as a result of such impairment or extinguishment of subrogation rights, Holdings may have a defense to a deficiency judgment arising out of the operation of Section 580d of the California Code of Civil Procedure and related principles of estoppel. Holdings waives all rights and defenses arising out of an election of remedies by the Banks, even though that election of remedies, such as a nonjudicial foreclosure with respect to security for a guaranteed obligation, has destroyed the guarantor's rights of subrogation and reimbursement against the principal by the operation of Section 580d of the California Code of Civil Procedure or otherwise. 14.09 Nature of Liability. It is the desire and intent of Holdings and the Secured Creditors that this Holdings Guaranty shall be enforced against Holdings to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. If, however, and to the extent that, the obligations of Holdings under this Holdings Guaranty shall be adjudicated to be invalid or unenforceable for any reason (including, without limitation, because of any applicable state or federal law relating to fraudulent conveyances or transfers), then the amount of the Guaranteed Obligations of Holdings shall be deemed to be reduced and Holdings shall pay the maximum amount of the Guaranteed Obligations which would be permissible under applicable law. -149- 157 IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Agreement as of the date first above written.
Address: 12655 North Central Expwy. CHANCELLOR BROADCASTING COMPANY Suite 405 Dallas, TX 75243 Attention: Chief Financial Officer By Telephone: (972) 239-6220 ---------------------------------- Telecopy: (972) 239-0220 Name: Title: with a copy to: Hicks, Muse, Tate & Furst Incorporated 200 Crescent Court, Suite 1600 Dallas, Texas 75201 Attn: Lawrence D. Stuart, Jr. Telephone: (214) 740-7300 Telecopy: (214) 740-7355 12655 North Central Expwy. CHANCELLOR RADIO BROADCASTING Suite 405 COMPANY Dallas, TX 75243 Attention: Chief Financial Officer Telephone: (972) 239-6220 By Telecopy: (972) 239-0220 ---------------------------------- Name: Title: with a copy to: Hicks, Muse, Tate & Furst Incorporated 200 Crescent Court, Suite 1600 Dallas, Texas 75201 Attn: Lawrence D. Stuart, Jr. Telephone: (214) 740-7300 Telecopy: (214) 740-7355 130 Liberty Street BANKERS TRUST COMPANY, New York, New York 10006 Individually and as Managing Agent Tel: (212) 250-7188 Fax: (212) 250-7218 Attention: Thomas P. Prior By ---------------------------------- Name: Title:
158 85 Broad Street GOLDMAN SACHS CREDIT PARTNERS L.P., New York, New York 10004 Individually and as Documentation Agent Tel: (212) 902-1608 Fax: (212) 346-3552 Attention: Ed Forst By ---------------------------------- Name: Title: 901 Main Street NATIONSBANK OF TEXAS, N.A., Dallas, Texas 75202 Individually and as Syndication Agent Tel: (214) 508-2445 Fax: (214) 508-9390 Attention: David James By ---------------------------------- Name: Title: 31 West 52nd Street TORONTO DOMINION (TEXAS), INC., New York, New York 10019 Individually and as Syndication Agent Tel: (212) 468-0300 Attention: Tom Westdyk By ---------------------------------- Name: Title: ABN AMRO Bank N.V. Houston Agency By: ---------------------------------- Name: Title: By: ---------------------------------- Name: Title:
159 BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By: ---------------------------------- Name: Title: BANK OF MONTREAL By: ---------------------------------- Name: Title: THE BANK OF NEW YORK By: ---------------------------------- Name: Title: THE BANK OF NOVA SCOTIA By: ---------------------------------- Name: Title: 160 BANQUE FRANCAISE DU COMMERCE EXTERIEUR By: ---------------------------------- Name: Title: By: ---------------------------------- Name: Title: BANQUE NATIONALE DE PARIS By: ---------------------------------- Name: Title: BANQUE PARIBAS By: ---------------------------------- Name: Title: By: ---------------------------------- Name: Title: 161 BARCLAYS BANK PLC By: ---------------------------------- Name: Title: CAISSE NATIONALE DE CREDIT AGRICOLE By: ---------------------------------- Name: Title: THE CHASE MANHATTAN BANK By: ---------------------------------- Name: Title: COMPAGNIE FINANCIERE DE CIC ET DE L'UNION EUROPEENNE By: ---------------------------------- Name: Title: By: ---------------------------------- Name: Title: 162 CORESTATES BANK, N.A. By: ---------------------------------- Name: Title: CITIBANK, N.A. By: ---------------------------------- Name: Title: CREDIT SUISSE FIRST BOSTON By: ---------------------------------- Name: Title: By: ---------------------------------- Name: Title: CYPRESSTREE INVESTMENT MANAGEMENT, INC. (As attorney in fact and on behalf of First Allmerica Financial Life Insurance Co.) By: ---------------------------------- Name: Title: 163 THE DAI ICHI KANGYO BANK, LTD. NEW YORK BRANCH By: ---------------------------------- Name: Title: BANKBOSTON, N.A. By: ---------------------------------- Name: Title: FIRST UNION NATIONAL BANK BY: ---------------------------------- Name: Title: FLEET BANK, N.A. By: ---------------------------------- Name: Title: 164 THE FUJI BANK, LIMITED By: ---------------------------------- Name: Title: HELLER FINANCIAL, INC. By: ---------------------------------- Name: Title: THE INDUSTRIAL BANK OF JAPAN, LIMITED, NEW YORK BRANCH By: ---------------------------------- Name: Title: KZH-ING-1 CORPORATION By: ---------------------------------- Name: Title: 165 THE LONG TERM CREDIT BANK OF JAPAN, LIMITED By: ---------------------------------- Name: Title: MELLON BANK, N.A. By: ---------------------------------- Name: Title: MERRILL LYNCH SENIOR FLOATING RATE FUND, INC. By: ---------------------------------- Name: Title: MERITA BANK LTD By: ---------------------------------- Name: Title: By: ---------------------------------- Name: Title: 166 THE MITSUBISHI TRUST AND BANKING CORPORATION By: ---------------------------------- Name: Title: OCTAGON CREDIT INVESTORS LOAN PORTFOLIO (a unit of The Chase Manhattan Bank) By: ---------------------------------- Name: Title: PARIBAS CAPITAL FUNDING LLC By: ---------------------------------- Name: Title: PRIME INCOME TRUST By: ---------------------------------- Name: Title: 167 SENIOR DEBT PORTFOLIO, by Boston Management and Research. as Investment Advisor By: ---------------------------------- Name: Title: SOCIETE GENERALE By: ---------------------------------- Name: Title: UNION BANK OF CALIFORNIA, N.A. By: ---------------------------------- Name: Title: VAN KAMPEN AMERICAN CAPITAL PRIME RATE INCOME TRUST By: ---------------------------------- Name: Title: 168 SCHEDULE I COMMITMENTS
Term Loan Revolving Loan Bank Commitment Commitment Total ---- ---------- -------------- ----- Bankers Trust Company $ 20,000,000.00 $ 17,500,000.00 $ 47,500,000.00 Goldman Sachs Credit Partners $ 14,400,000.00 $ 12,600,000.00 $ 27,000,000.00 L.P. NationsBank of Texas, N.A. $ 14,400,000.00 $ 12,600,000.00 $ 27,000,000.00 Toronto Dominion (Texas), Inc. $ 14,400,000.00 $ 12,600,000.00 $ 27,000,000.00 Bank of America National Trust $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 and Savings Association BankBoston, N.A. $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Banque Paribas $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 The Chase Manhattan Bank $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Societe Generate $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Union Bank of California, N.A. $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Barclays Bank, PLC $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Bank of Montreal $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Bank of New York $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 The Bank of Nova Scotia $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Banque Francaise Du Commerce $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Exterieur Corestates Bank, N.A. $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00
169
Term Loan Revolving Loan Bank Commitment Commitment Total ---- ---------- -------------- ----- Fuji Bank, Limited $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Industrial Bank of Japan, $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Limited, New York Branch Merrill Lynch Senior Floating $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Rate Fund, Inc. Mitsubishi Trust and Banking $ 12,000,000.00 $ 10,500,000.00 $ 22,500,000.00 Corporation Van Kampen American Capital $ 26,666,666.67 $ 23,333,333.33 $ 50,000,000.00 Prime Rate Income Trust ABN AMRO Bank, N.V. Houston $ 6,400,000.00 $ 5,600,000.00 $ 12,000,000.00 Agency Compagnie Financiere De CIC Et $ 9,333,333.34 $ 8,166,666.66 $ 17,500,000.00 De L'Union Europeenne Citibank, N.A. $ 9,333,333.34 $ 8,166,666.66 $ 17,500,000.00 Caisse Nationale De Credit $ 6,400,000.00 $ 5,600,000.00 $ 12,000,000.00 Agricole Credit Suisse First Boston $ 6,400,000.00 $ 5,600,000.00 $ 12,000,000.00 CypressTree Investment $ 6,400,000.00 $ 5,600,000.00 $ 12,000,000.00 Management The Dai Ichi Kangyo Bank, Ltd. $ 6,400,000.00 $ 5,600,000.00 $ 12,000,000.00 Prime Income Trust $ 6,400,000.00 $ 5,600,000.00 $ 12,000,000.00 First Union National Bank $ 9,333,333.33 $ 8,166,666.67 $ 17,500,000.00 Fleet Bank, N.A. $ 9,333,333.33 $ 8,166,666.67 $ 17,500,000.00 Heller Financial, Inc. $ 4,800,000.00 $ 4,200,000.00 $ 9,000,000.00 KZH-ING-1 Corporation $ 6,400,000.00 $ 5,600,000.00 $ 12,000,000.00
170
Term Loan Revolving Loan Bank Commitment Commitment Total ---- ---------- -------------- ----- Long Term Credit Bank of Japan, $ 5,333,333.33 $ 4,666,666.67 $ 10,000,000.00 Limited Mellon Bank, N.A. $ 4,800,000.00 $ 4,200,000.00 $ 9,000,000.00 Merita Bank Ltd $ 5,333,333.33 $ 4,666,666.67 $ 10,000,000.00 Octagon Credit Investors Loan $ 9,333,333.33 $ 8,166,666.67 $ 17,500,000.00 Portfolio Paribas Capital Funding LLC $ 6,400,000.00 $ 5,600,000.00 $ 12,000,000.00 TOTAL $400,000,000.00 $350,000,000.00 $750,000,000.00
171 SCHEDULE II EXISTING LETTERS OF CREDIT 1. [Bankers Trust Company letters of credit to remain in place after closing.] 172 SCHEDULE III REAL PROPERTY I. MORTGAGED PROPERTY A. REAL PROPERTY OWNED BY CHANCELLOR RADIO BROADCASTING COMPANY: 1. A parcel located at 840 North Central Avenue, Phoenix, Maricopa County, Arizona, including broadcast studios and offices (KYOT-FM, KZON-FM, KOY-AM and KISO-AM Site). 2. A parcel located at 6500 South 36th Street, Phoenix, Maricopa County, Arizona, including a transmitter facility and tower (KOY-AM Site). 3. A parcel located at 2345 West Buckeye Road, Phoenix, Maricopa County, Arizona, including a transmitter facility and tower (KISO-AM Site). 4. A parcel located in San Bernardino County, California, including a transmitter building and three towers (KMEN Transmitter/Studio Site). 5. A parcel located in El Dorado County, California, including a transmitter building and four towers (KHYL Transmitter Site). 6. A parcel located in Sutter County, California, including a transmitter building and a tower (Sutter County Site). 7. A parcel located at 16925 Black Rock Road, Germantown, Montgomery County, Maryland, including a transmitter facility and 4 towers (WTEM-AM Site). 8. A parcel located at Highway 47, Anoka County, Minnesota, including a transmitter facility and tower (KQQL-FM site). 173 9. A vacant parcel located in Dakota County, Minnesota (Minnesota Property). 10. A parcel located in Suffolk County, New York, including two transmitter buildings and a tower (WALK Transmitter Site). 11. A parcel located at 66 Colonial Drive, Patchogue, Suffolk County, New York, including a studio building and a tower (WALK Studio/Office Site). 12. A parcel located in Butler County, Ohio, including a building and a tower (WUBE Backup Transmitter Site). B. REAL PROPERTY OWNED BY SHAMROCK BROADCASTING, INC.: 1. A parcel located at 12040 N. 15th Drive, Shaw Butte, Phoenix, AZ (Transmitter Backup Site). 2. A parcel located at 2201 W. Indiana, Los Angeles, CA (AM Transmitter Site). 3. A parcel located at 6450 South Pennsylvania Street, Littleton, CO (AM transmitter site). 4. A parcel located at 5510 Union Church Road, Flowery Branch (Hall County), GA (Transmitter Site). [5. A parcel located at 20979 Flag Street, Prior Lake, MN (AM Transmitter Site).] 6. A parcel located at Cemetery Lane, Ross Township, Pittsburgh, PA (AM Transmitter Site). C. REAL PROPERTY OWNED BY KYSR INC. 1. A parcel located at 2555 Briarcrest Road, Los Angeles, CA (KYSR-FM Transmitter Site). 2 174 II. LEASEHOLD PROPERTY A. REAL PROPERTY LEASED BY CHANCELLOR RADIO BROADCASTING COMPANY: 1. KOOL Main Broadcast Studio & Offices Lease, 4745 N. 7th Street, Suite 204, Phoenix, AZ (Valley Commerce Building) Owned by: Valley Commerce Center Limited Partnership 2. KOOL Transmitter Lease (Communications Site License) Phoenix South Mountain Park, Arizona Owned by: City of Phoenix, Arizona 3. KOOL Auxiliary Transmitter, Communication Site 7, South Mountain, Arizona Owned by: NW Communications 4. KOOL Remote Lease, Shaw Butte, Arizona Owned by: Shamrock Broadcasting, Inc. 5. KYOT-FM Transmitter Site License, Phoenix South Mountain Park, Arizona Owned by: City of Phoenix, Arizona 6. KZON-FM Transmitter Site License, Phoenix South Mountain Park, Arizona Owned by: City of Phoenix, Arizona 7. Remote Pick-up Antenna and Radio Receiver located at Shaw Butte, Arizona Owned by: Shamrock Broadcasting, Inc. 8. KHYL Studio Office Lease, 2435 Marconi Avenue, Suite A, Sacramento, California Owned by: James Dong Mark, Trustee for the James Dong Mark Revocable Living Trust 3 175 9. KGGI FM Tower Lease, Running Springs, California Owned by: Kruse Microwave 10. KGGI FM Backup Tower Ground Lease, Riverside, California Owned by: Henry Broadcasting Company 11. KMEN/KGGI Office/Studio Lease, 2001 Iowa Avenue, Riverside, Riverside County, California Owned by: Hunter Park Office Plaza, L.P. 12. WOMX Tower Lease, 22000 Fort Christmas Road, Bithlo, FL. Owned by: TowerCom, Limited 13. WOMX Studio/Office Lease, 1801 Lee Road, Suite 201, Winter Park, FL. Owned by: Winter Park Joint Venture 14. WJHM Studio/Office Lease, 37 Sky Line Drive, Suite 4200, Suntech Commerce Park, Lake Mary, FL. Owned by: First Atlanta Services Corp. 15. WJHM Tower Antenna License, 520 Miller Road, Orange City, FL Owned by: Lodestar Tower Orlando, LTD. 16. WXXL Tower Lease, 435 West Story Road, Winter Garden, FL. Owned by: J.J. Taylor Companies, Inc. 17. WXXL Studio/Office Lease, Suite 1024, Altamonte Springs, Seminole County, FL. Owned by: Teachers' Retirements System of the State of Illinois 18. WOCL FM Tower License, Volusia County, Florida Owned by: Lodestar Tower Orlando Ltd. 19. WOCL FM Studio/Office Lease, 2101 West Hwy. 434, Longwood, Seminole County, Florida Owned by: Spring Offices, Ltd. 4 176 20. WFYV Ground Lease, located between Hogan Road and Newton Road in Duval County, FL. Owned by: Lodestar Towers, Inc. 21. WFYV Tower License, 8541 Newton Road, Atlantic Beach, FL. Owned by: Lodestar Tower Jacksonville, Ltd. 22. WAPE Main Tower Site Lease, 1094 East Adams Street, Jacksonville, FL. Owned by: Big League Tower Associates 23. WTEM/WBIG/WGMS Studio Office I-ease, 11300 Rockville Pike, Rockville, NM Owned by: One Central Plaza Joint Venture 24. KTCJ AM Tower License, Hennepin County, Minnesota Owned by: City of New Hope, Minnesota 25. KTCJ AM Transmitter Building Ground Lease, Hennepin County, Minnesota Owned by: Robert P. Kinney and Mary E. Kinney 26. KTCZ FM Tower Lease, Shoreview, Ramsey County, Minnesota Owned by: United Television,Inc. and Chancellor Broadcasting Company is actually a general partner of Shoreview FM Group which is the lessee under this lease 27. KTCZ/KTCJ Studio/Office Lease, Minneapolis, Hennepin County, Minnesota Owned by: Butler Properties, LLC. 28. KDWB Studio Lease, South Third Street, Minneapolis, Minnesota 5 177 29. KDWB Tower Lease, Shoreview, Minnesota Owned by: United Television, Inc. 30. KQQL/WBOB Studio Office Lease, 920 Dain Plaza, 60 South 6th Street, Minneapolis, MN. Owned by: Brookfield Development California, Inc. 31. WBOB Transmitter Lease, Shoreview, MN. Owned by: United Television 32. WBOB Auxiliary Transmitter Lease, The University of Minnesota Owned by: Regents of the University of Minnesota 33. Storage Space Leases at 10830 Greenbrier (KQQL) and 300 N. 5th Street (WBOB), Minneapolis, Minnesota Owned by: Minikahda Mini Storage 34. WYGY Transmitter Lease, Hamilton, Ohio Owned by: Jacor Communications, Inc. 35. WUBE, FM Tower/Transmitter Lease, Cincinnati, Hamilton County, Ohio Owned by: Scripps-Howard Broadcasting 36. WUBE/ WYGY Studio/Office Lease, 225 E. Sixth Street, Cincinnati, Ohio Owned by: R.E. Dietz & Company, Inc. 37. WUBE AM Tower Lease, 1430 Martin Drive, Cincinnati, Ohio Owned by: City of Cincinnati 38. WBIG Transmitter Lease, 5232 Lee Highway, Arlington, VA Owned by: WAVA Building Limited Partnership 39. WGMS/WBIG Auxiliary Transmitter Lease, 5321 First Place, N.E., Washington, DC Owned by: Colfax Towers, Inc. 6 178 40. WGMS Transmitter Lease, America University, Washington, DC Owned by: The America University B. REAL PROPERTY LEASED BY SHAMROCK BROADCASTING INC.: 1. KMLE Radio Station Lease, 645 East Missouri Avenue, Suite 244, Phoenix, AZ Owned by: CBS Investment Realty, Inc. 2. KMLE Radio Station Lease, South Mountain Park, Phoenix, AZ Owned by: KSAZ-TV 3. KMLE Radio Station Lease, South Mountain Park, Phoenix, AZ Owned by: City of Pheonix 4. Corporate Office Lease, 4444 Lakeside Drive, 2nd Floor, Burbank, CA Owned by: Shamrock Holdings of California 5. KZLA Radio Station Lease, 330 North Brand Boulevard, Suite 800, Glendale, CA Owned by: WRC Properties, Inc. 6. KZLA Radio Station Lease, 123 CBS Lane, Mt. Wilson, CA Owned by: CBS, Inc. 7. KZLA Radio Station Lease, Flint Peak, Glendale, CA Owned by: Peak Property Corporation 8. KABL Radio Station Lease, Sand Island, Oakland, CA Owned by: Port of Oakland 9. KABL-KBGG Radio Station Lease, 1025 Battery Street, San Francisco, CA Owned by: Soraya Imports, Inc. 7 179 10. KBGG Radio Station Lease, Mount Beacon, Sausalito, CA Owned by: Sundial Broadcasting 11. KBGG Radio Station Lease, Sunol Ridge, Pleasanton, CA Owned by: Sunol Development Company 12. KBGG Radio Station Lease, 2500 Vineyard Avenue, Alameda County, CA Owned by: Dennis Homer 13. KSAN and KNEW Radio Station Lease, 750 Battery Street, San Francisco, CA Owned by: James P. Edmondson 14. KBGG and KSAN Radio Stations Lease, 724 Battery Street, San Francisco, CA Owned by: Russell Reese 15. KNEW Radio Station Lease, Pt. Isabel, Richmond, CA Owned by: City of Richmond 16. KNEW Radio Station Lease, Pt. Isabel Treatment Plant, Richmond, CA Owned by: East Bay Municipal Utility District 17. KSAN Radio Station Lease, Radio Road, San Bruno Mountain, San Mateo County, CA Owned by: Watson Communication Systems, Inc. 18. KBGG and KSAN Radio Station Lease, Mount Diablo, Contra Costa County, CA Owned by: The RDS Company 19. KALC/KIMN Studio/Office Lease, The Tabor Center, 1200 17th Street, Suite 2300, Denver, CO. Owned by: Tabor Center Associates 20. KXXL Radio Station Lease, One Civic Center Plaza, 1560 Broadway, Suite 1100, Denver, CO Owned by: Hamilton Oil Building Partnership 8 180 21. KXKL Radio Station Lease, Mount Chief, Jefferson County, CO Owned by: Mikes-Stone Joint Venture 22. KXKL Radio Station Lease, 6091 Marshall Road, Boulder, CO Owned by: Russell W. Schaffer 23. KZDG Radio Station Lease, 6750 Weld County Road 17, Weld County, CO Owned by: Tsunami Communications 24. WFOX Radio Station Lease, 2000 Riveredge Parkway, Suite 797, Atlanta, GA Owned by: Carlyle Real Estate Partnership] 25. KEEY and KFAN Radio Stations Lease, Norwest Financial Center, 7900 Xerxes Avenue, Suite 102, Bloomington, MN Owned by: Zeller - Minnesota Limited 26. KEEY Radio Station Lease, 550 Gramsle Road, Shoreview, MN Owned by: United Television 27. KEEY Radio Station Lease, 805 8th Street, IDS Building, Minneapolis, MN Owned by: Broadcast Services, Inc. 28. KEEY and KFAN Radio Stations Lease, 611 Frontenac Place, St. Paul, MN Owned by: 1400, Inc. 29. WHTZ Radio Station Lease, Harmon Tower South, 5th Floor, 333 Meadowlands Parkway, Secaucus, NJ Owned by: Hartz Mountain Associates 9 181 30. WHTZ Radio Station Lease, 737 Third Avenue, 32nd Floor, New York, NY Owned by: Alper Securities, inc. 31. WHTZ Radio Station Lease, Empire State Building, New York, NY Owned by: Empire State Building Company 32. WWSW Radio Station Lease, One Allegheny Square, Suite 800, Pittsburgh, PA Owned by: Allegheny Center Associates 33. WWSW Radio Station Lease, 11 Television Hill, Pittsburgh, PA Owned by: WPXI, Inc. C. REAL PROPERTY LEASED BY WLIT INC. 1. WLIT Office/Studio Lease, 150 N. Michigan Avenue, Suite 1135, Chicago, IL Owned by: Park Place Associates 2. WLIT Main Transmitter Lease, 233 S. Wacker Drive, Sears Tower, 102nd floor, Chicago, IL Owned by: Sears, Roebuck and Co. 3. WLIT Backup Transmitter Lease, 875 N. Michigan Avenue, John Hancock Center - Room #9322, Chicago, IL Owned by: -------------------------------- 10 182 D. REAL PROPERTY LEASED BY KYSR INC. AND KIBB INC. 1. KYSR/KIBB Office/Studio Lease, 3500 West Olive Avenue, Suite 250, Burbank, CA Owned by: Toluca Lake Financial Center 2. KIBB Main Transmitter Lem, located at Mount Wilson, Los Angeles, CA Owned by: ------------------------------- 3. KIBB-FM Translator Lease, located at Loop Canyon, Orange County, CA Owned by: Commercial Activities Company 11 183 SCHEDULE IV FCC LICENSES Part A. Chancellor Broadcasting License Company KFBK(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KFBK(AM), SACRAMENTO, CALIFORNIA
=================================================================================== Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date =================================================================================== Main Station License KFBK(AM) BAL-931201E1 12/30/93 12/01/97 - ----------------------------------------------------------------------------------- Renewal of License KFBK(AM) BR-900730YT 11/26/90 12/01/97 (short form) - ----------------------------------------------------------------------------------- License KFBK(AM) BL-861217AA 02/10/87 12/01/97 (long form) - ----------------------------------------------------------------------------------- Emergency Broadcast System KFBK(AM) Issued 05/25/72 -- 12/01/97 Authorization ===================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KFBK(AM), SACRAMENTO, CALIFORNIA
=================================================================================== Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date =================================================================================== Remote Pickup KPK-421 BPLRE-910304MA 07/29/91 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup KLP-415 BLRE-16595 12/04/68 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup KA-88936 BMLRE-890616ME 08/01/89 12/01/97 - ----------------------------------------------------------------------------------- Aural Studio Transmitter Link WGI-267 BPLST-88101lMD 12/09/88 12/01/97 - ----------------------------------------------------------------------------------- Aural Studio Transmitter Link WLI-688 BPLST-881011ML 12/05/88 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup(1) WHE-795 BPLRE-900123ME 05/10/90 12/01/97 ===================================================================================
- -------------------------- 1. Authorization cannot be located in FCC files. 184
=================================================================================== Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date =================================================================================== Remote Pickup KQQ-308 9301480153 03/09/93 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup KPE-890 BPLRE-850320ME 05/13/85 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup KPE-800 BPLRE-830315MK 08/13/84 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup KPE-866 BPLRE-850320MC 05/06/85 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup KPE-870 BPLRE-850320MD 05/06/85 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup KB-96924 BLNRE-871125MB 01/15/88 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup KEH-389 BMLRE-841011ME 11/07/84 12/01/97 ===================================================================================
KGBY(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KGBY(FM), SACRAMENTO, CALIFORNIA
=================================================================================== Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date =================================================================================== Main Station License KGBY(FM) BALH-931201EJ 12/30/93 12/01/97 - ---------------------------------------------------------------------------------- License for Auxiliary Antenna KGBY(FM) BLH-911021KC 06/05/92 12/01/97 - ---------------------------------------------------------------------------------- Renewal of License then, BRH-900730A7 11/21/90 12/01/97 (short form) KAER(FM) - ---------------------------------------------------------------------------------- License then, BLH-850412KK 09/30/85 12/01/97 (long form) KAER(FM) - ---------------------------------------------------------------------------------- Emergency Broadcast System then, Issued 10/10/78 -- 12/01/97 Authorization KAER(FM) ===================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KGBY(FM), SACRAMENTO, CALIFORNIA
=================================================================================== Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date =================================================================================== Aural Studio Transmitter Link WLH-424 BPLST-851023MB 12/06/85 12/01/97 - ----------------------------------------------------------------------------------- Remote Pickup(2) KPK-422 BPLRE-900123MF 05/10/90 12/01/97 ===================================================================================
- ------------------------- 2. Authorization cannot be located in FCC files. 2 185 KHYL(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION (FM), AUBURN, CALIFORNIA
=================================================================================== Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date =================================================================================== Main Station license KHYL BALH-9404220GT 8/9/94 N/A WLD-518 - ----------------------------------------------------------------------------------- Auxiliary Antenna License KHYL BLH-930329KC 9/15/93 12/01/97 - ----------------------------------------------------------------------------------- Transfer of Control KHYL BTCH-930316GL 3/29/93 N/A From: Arthur Kern WLD-518 To: Arthur K. Kern Revocable Trust - ----------------------------------------------------------------------------------- Assignment of License KHYL BALH-920515EE 8/7/92 N/A From: Elliot B. Evers, WLD-518 Receiver To: National Radio Partners, L.P. - ----------------------------------------------------------------------------------- Renewal of I.License KHYL BRH-9007317L 8/7/92 12/01/97 WLD-518 - ----------------------------------------------------------------------------------- License KHYL BLH-850521KC 07/30/85 12/01/97 Reissued 11/19/92 for corrections - ----------------------------------------------------------------------------------- License for Auxiliary KHYL BLH-800208AG 12/2/80 12/01/97 Antenna and Transmitter(3) - ----------------------------------------------------------------------------------- Emergency Broadcast System KHYL N/A Issued 12/0l/97 Authorization 7/1/77 ===================================================================================
- -------------------- 3. A copy of this authorization was not obtained. The file in which the authorization is contained was transferred to Gettysburg, Pennsylvania. 3 186 CURRENT BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KHYL(FM), AUBURN, CALIFORNIA
=================================================================================== Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date =================================================================================== Aural STL License WLD-518 BPLST-890907MI 10/20/89 12/01/97 ===================================================================================
WALK(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WALK(AM), PATCHOGUE, NEW YORK
======================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ======================================================================================= Main Station License WALK(AM) BAL-940422GU 07/29/94 06/01/98 WALK(FM) BALH-940422GV Consent and Corrected and Auxiliaries Reissued 08/17/94 - --------------------------------------------------------------------------------------- Consent to Transfer Control of WALK(AM) BTC-930419EG 04/29/93 N/A American Media, Inc. WALK(FM) BTCH-930419EH From: Arthur H. Kern and To: Arthur H. Kern Auxiliaries Revocable Trust - --------------------------------------------------------------------------------------- License Renewal Authorization WALK(AM) BR-910108UC 08/29/91 06/01/98 and Auxiliaries - --------------------------------------------------------------------------------------- AM Broadcast Station License WALK(AM) BZ-851213AR 01/30/86 06/01/98 The "hours of operation are specified in previous authorization," which is Modification of License BZ-830909AH accompanied by Standard Broadcast Station License BR-810202H5/BZ-811022AI - --------------------------------------------------------------------------------------- Order to Show Cause Modifying WALK(AM) N/A Issued 06/01/98 License to Specify Nighttime 11/18/87 Operation with Nominal power of Effective 102 Watts 12/01/87 =======================================================================================
4 187
======================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ======================================================================================= Notice of Parameters for Operation WALK(AM) N/A Reissued 06/01/98 Under Pre-Sunrise Authority 04/26/94 (PSRA) - --------------------------------------------------------------------------------------- Revised Parameters for Operation WALK(AM) N/A Reissued 06/01/98 Under Post-Sunset Authority 04/26/94 (PSSA) - --------------------------------------------------------------------------------------- Emergency Broadcast System WALK(AM) EBSA 06/12/72 06/01/98 Authorization =======================================================================================
CURRENT BROADCAST AUXILIARY STATIONS ASSOCIATED WITH WALK(AM), PATCHOGUE, NEW YORK FCC records indicate there are no auxiliary station licenses associated with WALK(AM). WALK-FM AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WALK-FM, PATCHOGUE, NEW YORK
======================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ======================================================================================= Main Station License WALK-FM BALH-940422GV 07/29/94 06/01/98 WALK(AM) BAL-940422GU Consent and Corrected Auxiliaries and Reissued 08/17/94 - --------------------------------------------------------------------------------------- Consent to Transfer Control of WALK-FM BTCH-930419EH 04/29/93 N/A American Media, Inc. WALK(AM) BTC-930419EG From: Arthur H. Kern and To: Arthur H. Kern Auxiliaries Revocable Trust - --------------------------------------------------------------------------------------- FM Broadcast Station License, WALK-FM BLH-930714KA 10/14/93 06/01/98 Auxiliary Antenna - --------------------------------------------------------------------------------------- FM Broadcast Station License, Main WALK-FM BRH-910108UB 05/17/91 06/01/98 Antenna and Auxiliaries =======================================================================================
5 188
======================================================================================= CURRENT EXPIRATION TYPE OF AUTHORIZATION CALL SIGN FCC FILE NUMBER GRANT DATE DATE ======================================================================================= License Renewal Authorization WALK-FM BRH-910108UB 05/17/91 06/01/98 and Auxiliaries - --------------------------------------------------------------------------------------- Subsidiary Communications WALK-FM BRSCA-810202A2 05/29/81 06/01/98 Authorization BSCA-384 05/31/78 - --------------------------------------------------------------------------------------- Emergency Broadcast System WALK-FM EBSA 05/22/72 06/01/98 Authorization =======================================================================================
CURRENT BROADCAST AUXILIARY STATIONS ASSOCIATED WITH WALK-FM, PATCHOGUE, NEW YORK
======================================================================================= CURRENT EXPIRATION TYPE OF AUTHORIZATION CALL SIGN FCC FILE NUMBER GRANT DATE DATE ======================================================================================= Aural STL License WGW-987 BMLST-920303MM 06/25/92 06/01/98 - --------------------------------------------------------------------------------------- Aural Inter-City Relay (ICR) License WMF-954 BPLIC-921221ME 05/13/93 06/01/98 - --------------------------------------------------------------------------------------- Remote Pickup Base Mobile System KPF-856 BPLRE-881020MF 12/09/88 06/01/98 License Base No. 2 - --------------------------------------------------------------------------------------- Remote Pickup Mobile System KC-23745 BLNRE-881020ME 12/05/88 06/01/98 License =======================================================================================
WUBE(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WUBE(AM), CINCINNATI, OHIO
======================================================================================= CURRENT EXPIRATION TYPE OF AUTHORIZATION CALL SIGN FCC FILE NUMBER GRANT DATE DATE ======================================================================================= Main Station License WUBE(AM) BAL-940422GO 07/29/94 10/l/2004 - --------------------------------------------------------------------------------------- Consent to Transfer Control WUBE(AM) BTC-930316GH 03/29/93 N/A From: Arthur H. Kern To: Arthur H. Kern Revocable Trust =======================================================================================
6 189
======================================================================================= CURRENT EXPIRATION TYPE OF AUTHORIZATION CALL SIGN FCC FILE NUMBER GRANT DATE DATE ======================================================================================= Consent to Assignment of License WUBE(AM) BAL-911122HO 01/02/92 N/A From: American Media, Inc. To: National Radio Partners, L.P. - --------------------------------------------------------------------------------------- Renewal of License WUBE(AM) BR-890516UC 09/26/89 10/01/96 (short form) - --------------------------------------------------------------------------------------- License WUBE BL-890731AB 11/09/89 N/A - --------------------------------------------------------------------------------------- Emergency Broadcast System WUBE N/A Issued 10/01/96 Authorization 05/25/72 =======================================================================================
WUBE-FM AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WUBE(FM), CINCINNATI, OHIO
======================================================================================= CURRENT EXPIRATION TYPE OF AUTHORIZATION CALL SIGN FCC FILE NUMBER GRANT DATE DATE ======================================================================================= Main Station License WUBE-FM BALH-940422GQ 07/29/94 10/l/2004 - --------------------------------------------------------------------------------------- Renewal of License WUBE-FM BRH-890516UD 09/28/89 10/01/96 (short-form) - --------------------------------------------------------------------------------------- Consent to Transfer Control WUBE-FM BTCH-930316GK 03/29/93 N/A From: Arthur H. Kern To: Arthur H. Kern Revocable Trust - --------------------------------------------------------------------------------------- Consent to Assignment of License WUBE-FM BALH-911122HP 01/02/92 N/A From: American Media, Inc. To: National Radio Partners, L.P. - --------------------------------------------------------------------------------------- License WUBE-FM BLH-930707KB 10/07/93 10/01/96 - --------------------------------------------------------------------------------------- Construction Permit WUBE-FM BPH-9304141D 06/16/93 12/16/94 - --------------------------------------------------------------------------------------- Emergency Broadcast System WUBE-FM N/A 05/22/72 N/A Authorization =======================================================================================
7 190 CURRENT BROADCAST AUXILIARY STATIONS ASSOCIATED WITH WUBE-FM, CINCINNATI, OHIO
======================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ======================================================================================= Aural STL License WMU-278 BMLST-930723MD 10/08/93 10/01/96 =======================================================================================
WYGY(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WYGY(FM), HAMILTON, OHIO
======================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ======================================================================================= Main Station License WYGY BALH-940422GS 07/29/94 10/l/2004 KB-96945 - --------------------------------------------------------------------------------------- Transfer of Control WYGY BTCH-930316GG 03/29/93 N/A From: Arthur H. Kern KB-96945 To: Arthur H. Kern Revocable Trust - --------------------------------------------------------------------------------------- Assignment of License WZRZ BALH-921021HH 12/17/92 N/A From: Reams Broadcasting KB-96945 Corporation To: National Radio Partners, L.P. - --------------------------------------------------------------------------------------- Renewal of License WBVE BRH-890531WC 10/2/89 10/01/96 KB-96945 - --------------------------------------------------------------------------------------- License WBVE BLH-860428KD 10/21/86 10/01/96 - --------------------------------------------------------------------------------------- Emergency Broadcast System WSKS N/A Issued 10/01/96 Authorization =======================================================================================
(NOTE: "WZRZ", "WBVE", AND "WSKS" are the former call letters of "WYGY". Old authorizations will reflect these former call letters.) 8 191 BROADCAST AUXILIARY STATIONS ASSOCIATED WITH WYGY(FM), HAMILTON, OHIO
======================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ======================================================================================= R/P Mobile System License KB-96945 BLNRE-880519 7/25/88 10/01/2004 =======================================================================================
WKYN(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WKYN(AM), FLORENCE, KENTUCKY
======================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ======================================================================================= Main Station License WKYN(AM) * 10/01/2004 =======================================================================================
KTCJ(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KTCJ(AM), MINNEAPOLIS, MINNESOTA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Direct Measurement KTCJ BZ-940111AB 09/28/93 04/01/2005 - ----------------------------------------------------------------------------------------- Main Station license KICJ BALH-940422GP 07/29/94 N/A and auxiliaries - ----------------------------------------------------------------------------------------- Consent to Transfer of Control KTCJ BTC-930316GJ 03/29/93 N/A From: Arthur H. Kern and To: Arthur H. Ker auxiliaries Revocable Trust - ----------------------------------------------------------------------------------------- Consent to Assignment of Permit and KTCJ BAPL-920515EF 07/07/92 N/A License and From: Elliot B. Evers auxiliaries Receiver To: National Radio Partners, L.P. =========================================================================================
9 192
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Consent to Assignment of license KTCJ BAL-920501EC 05/12/92 N/A From: Parker Communications - and Minneapolis, Inc. auxiliaries To: Elliott B. Evers Receiver - ----------------------------------------------------------------------------------------- Renewal of License (short form) KTCJ BR-891130A2 03/23/90 04/01/97 - ----------------------------------------------------------------------------------------- Pre-Sunrise/Post-Sunset KTCJ N/A Issued 04/01/97 Authorization 04/20/94 - ----------------------------------------------------------------------------------------- Emergency Broadcast System KICJ N/A Issued N/A Authorization 06/12/72 =========================================================================================
KTCZ-FM AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KTCZ-FM, MINNEAPOLIS, MINNESOTA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KTCZ-FM BALH-940422GR 07/29/94 4/01/2005 and auxiliaries - ----------------------------------------------------------------------------------------- Consent to Transfer of Control KTCZ-FM BTCH-930316GM 03/29/93 N/A From: Arthur H. Kern and To: Arthur H. Kern auxiliaries Revocable Trust - ----------------------------------------------------------------------------------------- Consent to Assignment of License KTCZ-FM BALH-920515EG 07/07/92 N/A From: Elliot B. Evers and Receiver auxiliaries To: National Radio Partners, L.P. - ----------------------------------------------------------------------------------------- Consent to Assignment of license KTCZ-FM BALH-920501ED 05/12/92 N/A From: Parker Communications - and Minneapolis, Inc. auxiliaries To: Elliott B. Evers Receiver - ----------------------------------------------------------------------------------------- License KTCZ-FM BLH-910814KC 02/27/92 04/01/97 =========================================================================================
10 193
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Renewal of License (short form) KTCZ-FM BRH-891130A2 03/23/90 04/01/97 - ----------------------------------------------------------------------------------------- Auxiliary Antenna KTCZ-FM BMLH-910827KG 03/02/92 04/01/97 - ----------------------------------------------------------------------------------------- Emergency Broadcast System KTCZ-FM N/A 05/22/72 N/A Authorization =========================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KTCZ-FM, MINNEAPOLIS, MINNESOTA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL WIJ-814 BPLST-871109MF 01/15/88 04/01/2005 =========================================================================================
WOCL(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WOCL(FM), DELAND, FLORIDA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station license WOCL BALH-940422GN 07/29/94 2/01/2003 and Auxiliaries - ----------------------------------------------------------------------------------------- Transfers of Control WOCL BTCH-930316GP 03/29/93(4) N/A From: Arthur H. Kern and To: Arthur H. Kern Auxiliaries Revocable Trust - ----------------------------------------------------------------------------------------- Auxiliary Antenna WOCL BLH-90022OKD 12/21/90 10/ 1/95(5) =========================================================================================
4. The FAIR notes a different grant date of July 12, 1993. 5. The expiration date on the authorization is correct. 11 194
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Renewal WOCL BRH-880927ZG 1/31/90 2/l/96 and Auxiliaries - ----------------------------------------------------------------------------------------- License WOCL BLH-870721KC 3/24/88 2/01/96 - ----------------------------------------------------------------------------------------- Assignment of license' WOCL BALH-86021GGG 03/03/86 N/A From: American Media, Inc. and To: Mid-Florida Radio, Inc. Auxiliaries - ----------------------------------------------------------------------------------------- Emergency Broadcast System WDLF N/A Issued 2/l/96 Authorization 12/22/80 =========================================================================================
(Note: "WDLF" are former call letters of "WOCL". Old Authorizations will reflect these former call letters.) BROADCAST AUXILIARY STATIONS ASSOCIATED WITH WOCL, DELAND, FLORIDA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL License WLG-699 BPLST-851119MB 03/19/86 2/01/2003 - ----------------------------------------------------------------------------------------- Aural STL License WLG-789 BPLST-851119MA 03/19/86 10/01/96 - ----------------------------------------------------------------------------------------- R/P Mobile System License KB-96847 BLNRE-870108MA 5/06/87 10/01/96 - ----------------------------------------------------------------------------------------- R/P Base Station License KPJ-322 BPLRE-851119MC 3/19/86 10/01/96 - ----------------------------------------------------------------------------------------- R/P Mobile System license KB-97378 BLNRE-860725MJ 12/12/86 10101196 =========================================================================================
WAPE(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WAPE(FM), JACKSONVILLE, FLORIDA - -------------------- 6. A copy of this authorization was not obtained. The file in which this authorization is contained was retired to the Federal Records Center. 12 195
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station license WAPE(FM) * 2/01/2003 =========================================================================================
WFYV(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WFYV(FM), JACKSONVILLE, FLORIDA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WFYV(AM) * 2/01/2003 =========================================================================================
KMEN AND ASSOCIATED AUXILIARY STATIONS KMEN(AM), SAN BERNARDINO, CALIFORNIA MAIN STATION
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station license KMEN BAL-940422HE 07/29/94 12/l/97 - ----------------------------------------------------------------------------------------- License KMEN BZ-940224AB 06/30/94 12/l/97 - ----------------------------------------------------------------------------------------- License Modification KMEN BRC-94051 I AC 6/16/94 12/l/97 - ----------------------------------------------------------------------------------------- Emergency Broadcast Service KMEN N/A 05/22/72 12/l/97 =========================================================================================
CURRENT BROADCAST AUXILIARY FCC AUTHORIZATIONS ISSUED TO KMEN(AM), SAN BERNARDINO, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL WLP-543 BPLST-910227 06/17/91 12/01/97 =========================================================================================
13 196
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL WLP-572 BPLST-910227MB 7/25/91 12/l/97 =========================================================================================
KGGI AND ASSOCIATED AUXILIARY STATIONS KGGI(FM), RIVERSIDE, CALIFORNIA MAIN STATION
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station license KGGI BAL-940422HF 07/29/94 12/l/97 License KGGI BLH-910802KF 03/17/92 12/l/97 Emergency Broadcast Service KGGI N/A 07/15/79 12/1/97
CURRENT BROADCAST AUXILIARY FCC AUTHORIZATIONS KGGI(FM), RIVERSIDE, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL WLD-672 BPLST-RC1104TO 03/11/85 12/01/97 - ----------------------------------------------------------------------------------------- Aural STL WFW-618 BPIST-910227ME 6/17/91 12/1/97 =========================================================================================
KSTE(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KSTE(AM), RANCHO CORDOVA, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KSTE(AM) * 12/01/97 =========================================================================================
14 197
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= =========================================================================================
KDWB(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KDWB(FM), RICHFIELD, MINNESOTA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KDWB(FM) BLH-910814KA 4/l/2005 - ----------------------------------------------------------------------------------------- Auxiliary Antenna License KDWB(FM) BLH-920603KA 4/l/2005 =========================================================================================
CURRENT BROADCAST AUXILIARY FCC AUTHORIZATIONS KDWB(FM), RICHFIELD, MINNESOTA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL WLE-769 * 4/l/2005 - ----------------------------------------------------------------------------------------- Aural STL WLP-728 * 4/l/2005 =========================================================================================
WTEM(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WTEM(AM), BETHESDA, MD
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WTEM(AM) * 10/01/2003 - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup KPM-471 * 10/01/2003 - ----------------------------------------------------------------------------------------- Aural STL WLO-430 * 10/01/2003 - ----------------------------------------------------------------------------------------- Remote Pickup Base Mobile KPK-259 * 10/01/2003 =========================================================================================
15 198 WBIG(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WBIG(FM), ROCKVILLE, ME[)
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WBIG(FM) * 10/01/2003 - ----------------------------------------------------------------------------------------- Auxiliary Antenna WBIG(FM) * 10/01/2003 - ----------------------------------------------------------------------------------------- Aural STL WME-606 * 10/01/2003 =========================================================================================
WGMS(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WGMS(FM), WASHINGTON DC
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WGMS(FM) * 10/01/2003 - ----------------------------------------------------------------------------------------- Auxiliary Antenna WGMS(FM) * 10/01/2003 - ----------------------------------------------------------------------------------------- Aural STL WLO-429 * 10/01/2003 =========================================================================================
KOQL(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KQQL(FM), ANOKA, MINNESOTA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KQQL-(FM) * 4/01/2005 - ----------------------------------------------------------------------------------------- Application for minor KQQL(FM) BPH-960603IA 4/01/2005 modification of construction permit to requestauthority to construct a new auxiliary antenna facility filed on June 3, 1996 - ----------------------------------------------------------------------------------------- Aural STL WLF-665 * 4/01/2005 =========================================================================================
- ------------------------- * Confirmation Pending 16 199
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL WIJ-391 * 4/01/2005 - ----------------------------------------------------------------------------------------- Aural STL WLF-669 * 4/01/2005 =========================================================================================
WBOB(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WBOB(FM), MINNEAPOLIS, MINNESOTA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WBOB(FM) * Renewal Pending - ----------------------------------------------------------------------------------------- Auxiliary Antenna Construction WBOB-FM BPH-9504071B Renewal Permit BPH-9504071B Pending - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup KPF-879 * Renewal Pending - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup KPN-715 * Renewal Pending - ----------------------------------------------------------------------------------------- Aural STL WMF-893 * Renewal Pending =========================================================================================
KOOL(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KOOL(FM), PHOENIX, ARIZONA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KOOL(FM) * 10/01/97 - ----------------------------------------------------------------------------------------- Aural STL WDD-710 * 10/01/97 - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup WHE-837(7) * 10/01/97 =========================================================================================
- ----------------------- (7) Not listed in Catalog. 17 200
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Intercity Relay WLD-681(8) 10/01/97 - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup KPJ-938(8) 10/01/97 - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup KPJ-983(9) * 10/01/97 - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup KA-35291 * 10/01/97 =========================================================================================
KZON(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KZON(FM), PHOENIX, ARIZONA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KZON(FM) * 10/01/97 - ----------------------------------------------------------------------------------------- Auxiliary Antenna KZON(FM) * 10/01/97 - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup KPL,417 10/01/97 - ----------------------------------------------------------------------------------------- Aural STL WKS-92 * 10/01/97 =========================================================================================
- --------------------- 8. License indicates that auxiliary is associated with Station KOOL(AM). Application will be filed to change associated broadcast station to KOOL-FM. 9. Modification application filed July 8, 1996. - ----------------- * Cofirmation Pending 18 201 KOY(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KOY(AM), PHOENIX, ARIZONA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KOY(AM) * 10/01/97 - ----------------------------------------------------------------------------------------- Aural STL WFW-714 * 10/01/97 - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup KTJ-600 * 10/01/97 - ----------------------------------------------------------------------------------------- Low Power Broadcast Station BLP-00888 * 10/01/97 - ----------------------------------------------------------------------------------------- Broadcast Auxiliary KY-5633(10) * 10/01/97 - ----------------------------------------------------------------------------------------- Broadcast Auxiliary KY-5634(10) * 10/01/97 - ----------------------------------------------------------------------------------------- Broadcast Auxiliary KY-5635(10) * 10/01/97 - ----------------------------------------------------------------------------------------- Broadcast Auxiliary KV-4890(10) 10/01/97 - ----------------------------------------------------------------------------------------- Broadcast Auxiliary KP-9376(10) 10/01/97 - ----------------------------------------------------------------------------------------- Auxiliary Remote Pickup KBH-744(10) * 10/01/97 =========================================================================================
KYOT(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KYOT(FM), PHOENIX, ARIZONA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KYOT(FM) * 10/01/97 - ----------------------------------------------------------------------------------------- Aural STL WAX-38 * 10/01/97 - ----------------------------------------------------------------------------------------- Aural STL WHY-286 10/01/97 =========================================================================================
- ------------- 10. Schedule 1.2(a) to the Asset Purchase Agreement by and among Sundance Broadcasting, Inc., Sundance Broadcasting of Idaho, Inc., David E. Reese and Louise F. Reese and Radio 95 of Phoenix Limited Partnership indicates that this authorization is no longer in use. No notice of cancellation has been filed. - ------------ * Confirmation Pending 19 202 KISO(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KISO(AM), PHOENIX, ARIZONA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KISO(AM) * 10/01/97 =========================================================================================
PART B. SHAMROCK BROADCASTING, INC. WWSW(AM) AND ASSOCIATED ASSOCIATED STATIONS MAIN STATION WWSW(AM), PITTSBURGH, PENNSYLVANIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WWSW(AM) * 8/1/98 =========================================================================================
WWSW(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WWSW(FM), PITTSBURGH, PENNSYLVANIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WWSW(FM) * 8/1/98 - ----------------------------------------------------------------------------------------- License for Auxiliary Antenna WWSW(FM) * 8/l/98 =========================================================================================
- ----------------- * Confirmation Pending 20 203 BROADCAST AUXILIARY STATIONS ASSOCIATED WITH WWSW(FM), PITTSBURGH, PENNSYLVANIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Remote Pickup Base KGB-258 * 8/l/98 - ----------------------------------------------------------------------------------------- Aural STL WFD-489 * 8/l/98 - ----------------------------------------------------------------------------------------- Aural STL WFD-545 * 8/l/98 - ----------------------------------------------------------------------------------------- Aural STL WFD-546 * 8/l/98 - ----------------------------------------------------------------------------------------- Remote Pickup-Automatic Relay WZB-714 * 8/1/98 - ----------------------------------------------------------------------------------------- Receive Only Earth Station E-6966 * 8/19/98 - ----------------------------------------------------------------------------------------- Business Radio WNVY-920 * 11/03/98 =========================================================================================
KVOD(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KVOD(FM), GREELEY, COLORADO
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KVOD(FM) * 4/01/2005 =========================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KVOD(FM) GREELEY, COLORADO
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Auxiliary license KPM-379 * 4/01/2005 - ----------------------------------------------------------------------------------------- Auxiliary license KB-96246 * 4/01/2005 - ----------------------------------------------------------------------------------------- Auxiliary license WLF-617 * 4/01/2005 - ----------------------------------------------------------------------------------------- Auxiliary license WLO-631 * 4/01/2005 =========================================================================================
- ---------- * Cofirmation Pending 21 204 KRRF(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION (AM, DENVER, COLORADO
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KRRF(AM) * 4/l/2005 =========================================================================================
KRRG(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KRRF(FM), DENVER, COLORADO
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KRRF(FM) * 4/l/2005 - ----------------------------------------------------------------------------------------- License for Auxiliary Antenna KRRF(FM) * 4/l/2005 =========================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH (FM), DENVER, COLORADO
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= FM Booster KRRF(FM) * 4/l/2005 - ----------------------------------------------------------------------------------------- Aural STL WHY-442 * 4/l/2005 - ----------------------------------------------------------------------------------------- Aural STL WHY-443 * 4/l/2005 - ----------------------------------------------------------------------------------------- Remote Pickup Base KPF-237 * 4/l/2005 =========================================================================================
- ---------------- * Confirmation Pending 22 205 KMLE(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KMLE(FM), CHANDLER, ARIZONA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KMLE(FM) * 10/l/97 - ----------------------------------------------------------------------------------------- License for Auxiliary Antenna KMLE(FM) * 10/l/97 =========================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KMLE(FM), CHANDLER, ARIZONA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL WLI-670 * 10/l/97 - ----------------------------------------------------------------------------------------- Aural STL WGI-232 * 10/1/97 - ----------------------------------------------------------------------------------------- Remote Pickup-Mobile KS-62911 * 10/l/97 =========================================================================================
KLAC(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KLAC(AAI), LOS ANGELES, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KLAC(AM) * 12/l/97 =========================================================================================
KZLA(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KZLA(FM), LOS ANGELES, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KZLA(FM) * 12/1/97 - ----------------------------------------------------------------------------------------- License for Auxiliary Antenna KZLA(FM) * 12/l/97 =========================================================================================
- ------------- * Confirmation Pending 23 206 BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KZLA(FM), LOS ANGELES, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL WLF-542 * 12/l/97 - ----------------------------------------------------------------------------------------- POFMS WLF-835 * 6/l/98 =========================================================================================
KABL(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KABL(AM), OAKLAND, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KABL(AM) * 12/1/97 =========================================================================================
KBGG(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KBGG(FM), SAN FRANCISCO, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KBGG(FM) * 12/l/97 - ----------------------------------------------------------------------------------------- FM Booster (Walnut Creek) KABL(FM1) * 12/l/97 - ----------------------------------------------------------------------------------------- FM Booster (Pleasanton) KABL(FM2) * 12/l/97 - ----------------------------------------------------------------------------------------- Construction Permit for FM KBGG(FM1) * 1/20/97 Booster (Concord) - ----------------------------------------------------------------------------------------- Remote Pickup-Base KOS-332 * 12/l/97 - ----------------------------------------------------------------------------------------- Remote Pickup-Base/Mobile KRS-519 * 12/l/97 - ----------------------------------------------------------------------------------------- Aural STL KVB-60 * 12/l/97 - ----------------------------------------------------------------------------------------- Aural later-City Relay WLP-333 * 12/l/97 =========================================================================================
f - ------------ * Confirmation Pending 24 207 KNEW(AM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KNEW(AM), OAKLAND, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KNEW(AM) * 12/l/97 =========================================================================================
KSAN(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KSAN(FM), SAN FRANCISCO, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KSAN(FM) * 12/l/97 =========================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KSAN(FM), SAN FRANCISCO, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= FM Booster KSAN(FM1) * 12/l/97 - ----------------------------------------------------------------------------------------- Aural STL WCY-22 * 12/l/97 - ----------------------------------------------------------------------------------------- Aural STL WLD-656 * 12/l/97 =========================================================================================
- ---------------- * Confirmation Pending 25 208 KFAN(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KFAN(AM), MINNEAPOLIS, MINNESOTA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= License Application Pending KFAN(AM) BL-940802AF Renewal Pending - ----------------------------------------------------------------------------------------- Construction Permit Pending KFAN BP-940802A-C =========================================================================================
KFEY(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KEEY(FM), MINNEAPOLIS, MINNESOTA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KEEY(FM) * 4/l/2005 - ------------------------------------------------------------------------------------------ Auxiliary Antenna KEEY(AM) * Renewal Pending - ------------------------------------------------------------------------------------------ Remote Pickup-Mobile KA-74989 * Renewal Pending - ------------------------------------------------------------------------------------------ Aural STL W-G-247 * Renewal Pending - ------------------------------------------------------------------------------------------ Remote Pickup-Mobile KK-7690 * Renewal Pending - ------------------------------------------------------------------------------------------ RP Automatic Relay KGJ-999 * Renewal Pending - ------------------------------------------------------------------------------------------ Auxiliary KPF-980 * Renewal Pending - ------------------------------------------------------------------------------------------ Remote Pickup-Base/Mobile KFZ-941 * Renewal Pending =========================================================================================
- --------------- * Confirmation Pending 26 209 WHTZ(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WHTZ(FM), NEW YORK, NEW YORK
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station license WHTZ(FM) * 6/l/98 - ----------------------------------------------------------------------------------------- Auxiliary Antenna (application to WHTZ(FM) BMLH-941114KH 6/l/98 modify license pending) =========================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH WHTZ(FM), NEW YORK, NEW YORK
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Aural STL WLF-541 * 6/l/98 - ----------------------------------------------------------------------------------------- POFMS WNEG-653 * 6/2/98 - ----------------------------------------------------------------------------------------- POFMS WNEI-922 * 6/2/98 =========================================================================================
WFOX(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WFOX(FM), GAINESVILLE, GEORGIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WFOX(FM) * 4/01/2004 =========================================================================================
- ----------------- * Confirmation Pending 27 210 WOMX(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WOMX(FM), ORLANDO, FLORIDA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WOMX(FM) * 2/01/2003 =========================================================================================
WXXL(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WJHM(FM), DAYTONA BEACH, FLORIDA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WJHM(FM) * 2/01/2003 =========================================================================================
WXXL(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION (FM), LEESBURG, FLORIDA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WXXL(FM) * 2/01/2003 =========================================================================================
BROADCAST AUXILIARY STATION ASSOCIATED WITH WXXL(FM) LEESBURG, FLORIDA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Auxiliary License WHB-992 * 2/01/2003 - ----------------------------------------------------------------------------------------- Auxiliary license WLJ-566 * 2/01/2003 - ----------------------------------------------------------------------------------------- Auxiliary License KB-55884 * 2/01/2003 =========================================================================================
PART C. WLIT INC. - ------------- * Confirmation Pending 28 211 WLIT(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION WLIT (FM), CHICAGO, ILLINOIS
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License WLIT(FM) 12/01/2004 =========================================================================================
PART D. KIBB INC. KIBB(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KIBB(FM), LOS ANGELES, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KIBB(FM) * 12/01/97 - ----------------------------------------------------------------------------------------- FM Translator K261AB * 12/01/97 - ----------------------------------------------------------------------------------------- FM Translator (Renewal) BRFT61126YS 12/01/97 - ----------------------------------------------------------------------------------------- License to cover BLH961210KA 12/01/97 =========================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KIBB(FM), LOS ANGELES, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= KSZ-63 * 12/01/97 =========================================================================================
- ----------- * Confirmation Pending 29 212 PART E. KYSR INC. KYSR AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KYSR(FM), LOS ANGELES, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KYSR(FM) * 12/01/97 - ----------------------------------------------------------------------------------------- Commercial Paging SCA 2574-CD-P/ML-01- 95 =========================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KYSR(FM), LOS ANGELES, CALIFORNIA
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= WHY-988 * 12/01/97 =========================================================================================
- ---------- * Confirmation Pending 30 213 PART F. SHAMROCK BROADCASTING LICENSES OF DENVER, INC. KIMN(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION (FW), DENVER, COLORADO
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KIMN(FM) * Renewal Pending =========================================================================================
BROADCAST AUXILIARY STATIONS ASSOCIATED WITH KIMN(FM) DENVER, COLORADO
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= FM Booster KIMN-FM(1) * Renewal Pending - ----------------------------------------------------------------------------------------- Auxiliary License WCD-984 * Renewal Pending =========================================================================================
KALC(FM) AND ASSOCIATED AUXILIARY STATIONS MAIN STATION KALC(FM), DENVER, COLORADO
========================================================================================= Current Expiration Type of Authorization Call Sign FCC File Number Grant Date Date ========================================================================================= Main Station License KALC(FM) * Renewal Pending =========================================================================================
- --------------------- * Confirmation Pending 214 SCHEDULE V INSURANCE (See Attached) 215 ISSUE DATE (MM/DD/YY) [ACORD LOGO] CERTIFICATE OF INSURANCE [ ] 6/24/97
PRODUCER ------------------------------------------- THIS CERTIFICATE IS USED AS A MATTER OF Aon Risk Services of MO, Inc. INFORMATION ONLY AND CONFERS NO RIGHTS UPON 8182 Maryland Avenue THE CERTIFICATE HOLDER. THIS CERTIFICATE St. Louis, MO 63105 DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE Contact: Mark Smith AFFORDED BY THE POLICIES BELOW. 314-721-5100 -------------------------------------------- COMPANIES AFFORDING COVERAGE -------------------------------------------- - ---------------------------------- COMPANY INSURED LETTER A Federal Insurance Company -------------------------------------------- Chancellor Broadcasting Co. COMPANY Attn: Eric Neumann LETTER B Westchester Fire Ins. Co. 12655 N. Central Expwy, #405 -------------------------------------------- Dallas COMPANY TX 75243 LETTER C National Casualty Company -------------------------------------------- - ---------------------------------- COMPANY LETTER D -------------------------------------------- COMPANY LETTER E --------------------------------------------
COVERAGES THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN. THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. - -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------- O6 POLICY EFFECTIVE POLICY EXPIRATION LTR TYPE OF INSURANCE POLICY NUMBER DATE (MM/DD/YY) DATE (MM/DD/YY) - -------------------------------------------------------------------------------------------- GENERAL LIABILITY A [X] COMMERCIAL GENERAL LIABILITY 73210058 4/01/97 4/01/98 [ ][ ] CLAIMS MADE [X] OCCUR. [ ] OWNER'S & CONTRACTOR'S PROT. [ ] --------------------------- - -------------------------------------------------------------------------------------------- AUTOMOBILE LIABILITY A [X] ANY AUTO 73210057 4/01/97 4/01/98 [ ] ALL OWNED AUTOS [ ] SCHEDULED AUTOS 73210059 (TX) 4/01/97 4/01/98 [X] HIRED AUTOS [X] NON-OWNED AUTOS COMP. - $500 DEDUCT. [ ] GARAGE LIABILITY [ ] COLL. - $500 DEDUCT. - -------------------------------------------------------------------------------------------- EXCESS LIABILITY B [X] UMBRELLA FORM CUA1036790 4/01/97 4/01/98 [ ] OTHER THAN UMBRELLA FORM - -------------------------------------------------------------------------------------------- WORKER'S COMPENSATION A AND 71632579 4/01/97 4/01/98 EMPLOYERS' LIABILITY - -------------------------------------------------------------------------------------------- OTHER C Broadcasters Liab. LS741225C 12/01/96 12/01/97 - --------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------- 06 LTR LIMITS - -------------------------------------------------------------------------------------------- GENERAL LIABILITY GENERAL AGGREGATE $ 2,000,000 -------------------------------------------------------- PRODUCTS-COMP/OP AGG. $ 1,000,000 -------------------------------------------------------- PERSONAL & ADV. INJURY $ 1,000,000 -------------------------------------------------------- EACH OCCURRENCE $ 1,000,000 -------------------------------------------------------- FIRE DAMAGE (Any one fire) $ 1,000,000 -------------------------------------------------------- MED. EXPENSE (Any one person) $ 10,000 - -------------------------------------------------------------------------------------------- AUTOMOBILE LIABILITY COMBINED SINGLE LIMIT $ 1,000,000 -------------------------------------------------------- BODILY INJURY (Per person) -------------------------------------------------------- BODILY INJURY (Per accident) -------------------------------------------------------- PROPERTY DAMAGE - -------------------------------------------------------------------------------------------- EXCESS LIABILITY EACH OCCURRENCE $ 5,000,000 -------------------------------------------------------- AGGREGATE $ 5,000,000 -------------------------------------------------------- - -------------------------------------------------------------------------------------------- WORKER'S COMPENSATION [ ] STATUTORY LIMITS AND -------------------------------------------------------- EMPLOYERS' LIABILITY EACH ACCIDENT $ 1,000,000 -------------------------------------------------------- DISEASE-POLICY LIMIT $ 1,000,000 -------------------------------------------------------- DISEASE-EACH EMPLOYEE $ 1,000,000 - -------------------------------------------------------------------------------------------- OTHER $2,000,000 Ea. Loss - --------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------- DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS Certificate Holder is added as an additional insured with respects to their financial interest in the acquisition of four (4) Viacom stations. - -------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO MAIL 30 DAYS WRITTEN NOTICE TO THE Bankers Trust Company, as CERTIFICATE HOLDER NAMED TO THE LEFT, BUT Managing Agent and Arranger FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO 130 Liberty Street OBLIGATION OR LIABILITY OF ANY KIND UPON New York, NY 10006 THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
AUTHORIZED REPRESENTATIVE /s/ J. CURTIS ENGLER 730080009 216 DATE (MM/DD/YY) [ACORD LOGO] EVIDENCE OF PROPERTY INSURANCE [ ] 6/25/97 THIS IS EVIDENCE THAT INSURANCE AS IDENTIFIED BELOW HAS BEEN ISSUED, IS IN FORCE, AND CONVEYS ALL THE RIGHTS AND PRIVILEGES AFFORDED UNDER THE POLICY.
- --------------------------------------------------------------------------------------------------------------- PRODUCER COMPANY Aon Risk Services of MO Lexington Insurance Co. (DE) 8182 Maryland Avenue American International Group St. Louis, MO 63105 100 Summer Street Boston, MA 02110 314-721-5100 CODE SUB-CODE
- --------------------------------------------------------------------------------------------------------------- INSURED LOAN NUMBER POLICY NUMBER Chancellor Broadcasting Co. 8793049 Attn: Eric Neumann ---------------------------------------------------- 12655 N. Central Expwy, #405 EFFECTIVE DATE EXPIRATION DATE CONT. UNTIL Dallas (MM/DD/YY) (MM/DD/YY) TERMINATED TX 75243 4/01/97 4/01/98 IF CHECKED [ ] ---------------------------------------------------- THIS REPLACES PRIOR EVIDENCE DATED: - ---------------------------------------------------------------------------------------------------------- ----
PROPERTY INFORMATION LOCATION/DESCRIPTION Four (4) Viacom stations - -------------------------------------------------------------------------------- COVERAGE INFORMATION
COVERAGE/PERILS/FORMS AMOUNT OF INSURANCE DEDUCTIBLE - --------------------------------------------------------------------------------------------------------------- Building, Personal Property, 5,000 Business Interruption Boiler & Machinery All Risk including theft Subject to policy terms, conditions and exclusions - ---------------------------------------------------------------------------------------------------------------
REMARKS (Including Special Conditions) See attached addendum for policy layering of the Master Property Program for Hicks, Muse, Tate & Furst $400,000,000 Policy Limit - -------------------------------------------------------------------------------- CANCELLATION THE POLICY IS SUBJECT TO THE PREMIUMS, FORMS, AND RULES IN EFFECT FOR EACH POLICY PERIOD. SHOULD THE POLICY BE TERMINATED, THE COMPANY WILL GIVE THE ADDITIONAL INTEREST IDENTIFIED BELOW 30 DAYS WRITTEN NOTICE, AND WILL SEND NOTIFICATION OF ANY CHANGES TO THE POLICY THAT WOULD AFFECT THAT INTEREST, IN ACCORDANCE WITH THE POLICY PROVISIONS OR AS REQUIRED BY LAW. - -------------------------------------------------------------------------------- ADDITIONAL INTEREST NAME AND ADDRESS NATURE OF INTEREST [ ] MORTGAGEE [ ] ADDITIONAL INSURED Bankers Trust Company, as [X] LOSS PAYEE [ ] (OTHER) Managing Agent and Arranger --------- 130 Liberty Street New York NY 10006 ---------------------------------------- SIGNATURE OF AUTHORIZED AGENT OF COMPANY /s/ J. CURTIS ENGLE 730090 9 ACORD 27 (2/88) ACORD CORPORATION 1988 217 SCHEDULE VI EXISTING LIENS I. Shamrock Broadcasting, Inc.
Filing Jurisdiction File Number Date Secured Party ------------ ----------- ---- -------------------------- ARIZONA: SOS 827154 4/12/95 AT&T CALIFORNIA: SOS 86232680 9/15/86 Leasing Service Corp. cont. 6/17/91 86321096 12/26/86 Leasing Service Corp. cont. 9/9/91 9514660807 5/25/95 The Bennett Funding Group, Inc. 9529360805 10/18/95 Orix USA Corp. MICHIGAN: SOS B846160 9/16/86 Leasing Service Corporation cont. 6/17/91 C490755 TEXAS: SOS 86271373 9/16/86 Leasing Service Corporation cont. 6/17/91 50102704 87037353 2/9/87 Credit Alliance Corporation cont. 11/4/91 50172087 94102637 5/23/94 Southwestern Bell Telecommunications, Inc.
II. Chancellor Radio Broadcasting Company(1)
Filing Jurisdiction File Number Date Secured Party ------------ ----------- ---- ------------------------------ ARIZONA: SOS 896146 5/2/96 Advanta Business Services Corp. amendment 9/12/96
- ------------------------- 1. Radio 95 of Phoenix Limited Partnership is currently the debtor. 218 III. KIBB Inc.
Filing Jurisdiction File Number Date Secured Party ------------ ----------- ---- ------------- None
IV. KYSR Inc.
Filing Jurisdiction File Number Date Secured Party ------------ ----------- ---- ------------- CALIFORNIA: SOS 93049234(2) 3/10/93 Westlake Audit, Inc.
V. WLIT Inc.
Filing Jurisdiction File Number Date Secured Party ------------ ----------- ---- ------------- ILLINOIS: SOS 3075856(3) 1/21/93 Ameritech Credit Corporation
VI. WDRQ Inc.
Filing Jurisdiction File Number Date Secured Party ------------ ----------- ---- ------------- None
- ------------------------- 2. Debtor has satisfied all obligations in connection with the Equipment secured by the UCC-1. UCC-3 to be provided by Secured Party. 3. Viacom International Inc. is currently the Debtor. 219 SCHEDULE VII EXISTING INDEBTEDNESS 1. Acquisition of the transmitter tower and transmitter site of WKYN-AM. 220 ANNEX 5.07 1. Indecency compliant has been lodged with the FCC against Station KALC (FM) Denver, Colorado. This complaint has not advanced to a stage where the licensee has an opportunity to review and respond to the allegations. 2. WXXI Public Broadcasting Council filed with the FCC a Petition for Issuance of Order to Show Cause ("Petition") against radio station WALK (AM), Patchogue, New York, seeking to reduce the nighttime power of that station from 102 watts to 41.8 watts. 3. Station KFAN (AM), Minneapolis, Minnesota is operating under an STA with parameters at variance pending completion of adjustments to its directional antenna pattern. 4. The tower for Station WUBE (AM), Cincinnati, Ohio was constructed at a location that varies slightly from the coordinates specified in its license. This was discovered in connection with the FCC's tower registration process and appropriate applications have been filed with the FCC to correct this discrepancy. 5. The towers for Stations KISO, Phoenix, Arizona and WFOX, Gainsville, Georgia have been constructed at locations varying slightly from the coordinates in their licenses. This was discovered in connection with the FCC's tower registration process. Applications correcting these discrepancies have not yet been filed. 221 12655 North Central Expwy. CHANCELLOR RADIO BROADCASTING Suite 405 COMPANY Dallas, TX 75243 By /s/JACQUES KERREST ----------------------------- Jacques Kerrest with a copy to: Senior Vice President Hicks, Muse, Tate & Furst Incorporated 200 Crescent Court, Suite 1600 Dallas, Texas 75201 Attn: Thomas 0. Hicks, John R. Muse, Jack D. Furst and Lawrence D. Stuart, Jr. Telephone: (214) 740-7300 Telecopy: (214) 740-7313 and Hicks, Muse, Tate & Furst Incorporated 1325 Avenue of the Americas 25th Floor New York, New York 10019 Attn: Mr. Charles W. Tate Telephone: (212) 424-1400 Telecopy: (212) 424-1450 222 IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Agreement as of the date first above written. Address: 12655 North Central Expwy. CHANCELLOR BROADCASTING COMPANY Suite 405 Dallas, TX 75243 By /s/ JACQUES KERREST -------------------------------- Jacques Kerrest with a copy to: Senior Vice President Hicks, Muse, Tate & Furst Incorporated 200 Crescent Court, Suite 1600 Dallas, Texas 75201 Attn: Thomas 0. Hicks, John R. Muse, Jack D. Furst and Lawrence D. Stuart, Jr. Telephone: (214) 740-7300 Telecopy: (214) 740-7313 and Hicks, Muse, Tate & Furst Incorporated 1325 Avenue of the Americas 25th Floor New York, New York 10019 Attn: Mr. Charles W. Tate Telephone: (212) 424-1400 Telecopy: (212) 424-1450 223 130 Liberty Street BANKERS TRUST COMPANY, Individually and as Managing Agent New York, New York 10006 Tel: (212) 250-7188 Fax: (212) 250-7218 Attention: Thomas P. Prior By /s/ MARY KAY COYLE ----------------------------------- Name: Mary Kay Coyle Title: Managing Director 224 KZH-ING-1 CORPORATION By: /s/ ROBERT GOODWIN ----------------------------------- Name: Robert Goodwin Title: Authorized Agent 225 CAISSE NATIONALE DE CREDIT AGRICOLE By: /s/ ILLEGIBLE ----------------------------------- Name: Title: 226 SOCIETE GENERALE By: /s/ MARK VIGIL ----------------------------------- Name: Mark Vigil Title: Vice President 227 SOCIETE GENERALE By: /s/ CHRISTOPHER J. SPELTZ ----------------------------------- Name: Christopher J. Speltz Title: V.P. and Manager 228 FLEET BANK, N.A. By: /s/ ALLISON KING ----------------------------------- Name: Allison King Title: Banking Officer 229 MERRILL LYNCH SENIOR FLOATING RATE FUND, INC. By: /s/ ANTHONY R. CLEMENTE ----------------------------------- Name: Anthony R. Clemente Title: Authorized Signatory 230 FIRST UNION NATIONAL BANK By: /s/ BRUCE W. LOFTIN ----------------------------------- Name: Bruce W. Loftin Title: Senior Vice President 231 31 West 52nd Street TORONTO DOMINION (TEXAS), INC., New York, New York 10019 Individually and as Syndication Agent Tel: (212) 468-0300 Attention: Tom Westdyk By: /s/ DARLENE REIDEL ----------------------------------- Name: Darlene Reidel Title: Vice President 232 HELLER FINANCIAL, INC. By: /s/ PATRICK HAYES ----------------------------------- Name: Patrick Hayes Title: Vice President 233 THE INDUSTRIAL BANK OF JAPAN, LIMITED, NEW YORK BRANCH By: /s/ JEFFREY COLE ----------------------------------- Name: Jeffrey Cole Title: Senior Vice President 234 BANK OF AMERICA NATTIONAL TRUST AND SAVINGS ASSOCIATION By: /s/ MATTHEW J. KOENIG ----------------------------------- Name: Matthew J. Koenig Title: Vice President 235 85 Broad Street GOLDMAN SACHS CREDIT PARTNERS L.P., New York, New York 10004 Individually and as Documentation Agent Tel: (212) 902-1608 Fax: (212) 346-3552 Attention: Ed Forst By: ----------------------------------- Name: Title: 901 Main Street -- 64th Floor NATIONSBANK OF TEXAS, N.A., Dallas, Texas 75202 Individually and as Syndication Agent Tel: (214) 508-2752 Fax: (214) 508-9390 By: /s/ JENNIFER F. ZYDNEY Attention: Jennifer Zydney ----------------------------------- Name: Jennifer F. Zydney Title: Vice President 236 THE BANK OF NOVA SCOTIA By: /s/ MARGOT C. BRIGHT ----------------------------------- Name: Margot C. Bright Title: Authorized Signatory 237 THE FUJI BANK, LIMITED By: /s/ PHILIP C. LAUINGER III ----------------------------------- Name: Philip C. Lauinger III Title: Vice President & Manager 238 BANQUE FRANCAISE DU COMMERCE EXTERIEUR By: /s/ KEVIN DOOLEY ---------------------- Name: Kevin Dooley Title: Vice President /s/ WILLIAM C. MAIER ---------------------- William C. Maier VP-Group Manager 239 BANKBOSTON, N.A. By: /s/ [ILLEGIBLE] ----------------------------------- Name: [ILLEGIBLE] Title: Director 240 ABN AMRO Bank N.V. Houston Agency By: /s/ LAURIE C. TUZO ----------------------------------- Name: Laurie C. Tuzo Title: Group Vice President By: /s/ DIEGO PUIGGARI ----------------------------------- Name: Diego Puiggari Title: Vice President 241 VAN KAMPEN AMERICAN CAPITAL PRIME RATE INCOME TRUST By: /s/ KATHLEEN A. ZARN ----------------------------------- Name: Kathleen A. Zarn Title: Vice President 242 UNION BANK OF CALIFORNIA, N.A. By: /s/ BRYAN G. PETERMANN ----------------------------------- Name: Bryan G. Petermann Title: Vice President SCHEDULE I 243 PARIBAS CAPITAL FUNDING LLC By: /s/ [ILLEGIBLE] ----------------------------------- Name: Title: 244 BARCLAYS BANK PLC By: /s/ LES BEK ----------------------------------- Name: Les Bek Title: Director 245 CITIBANK, N.A. By: /s/ HANS L. CHRISTENSEN ----------------------------------- Name: Hans L. Christensen Title: Vice President 246 CORESTATES BANK, N.A. By: /s/ DOUGLAS E. BLACKMAN ----------------------------------- Name: Douglas E. Blackman Title: Vice President 247 85 Broad Street GOLDMAN SACHS CREDIT PARTNERS L.P., New York, New York 10004 Individually and as Documentation Agent Tel: (212) 902-1608 Fax: (212) 346-3552 Attention: Ed Forst By: /s/ STEPHEN J. MCGUINNESS ----------------------------------- Name: Stephen J. McGuinness Title: Authorized Signatory 248 MELLON BANK, N.A. By: /s/ STEPHEN D. LACKEY ----------------------------------- Name: Stephen D. Lackey Title: Senior Vice President 249 THE BANK OF NEW YORK By: /s/ JOSEPH P. MATTEO ----------------------------------- Name: Joseph P. Matteo Title: Vice President Re: Chancellor 6/26/97 Agreements 250 THE MITSUBISHI TRUST AND BANKING CORPORATION By: /s/ PATRICIA LORET DE MOLA ----------------------------------- Name: Patricia Loret de Mola Title: Senior Vice President 251 BANQUE PARIBAS By: /s/ JOHN G. ACKER ----------------------------------- Name: John G. Acker Title: Group Vice President, Media Group By: /s/ TOM G. BRANDT ----------------------------------- Name: Tom G. Brandt Title: Vice President, Media Group 252 OCTAGON CREDIT INVESTORS LAON PORTFOLIO (a unit of The Chase Manhattan Bank) By: /s/ ANDREW D. GORDON ----------------------------------- Name: Andrew D. Gordon Title: Managing Director 253 THE LONG TERM CREDIT BANK OF JAPAN, LIMITED By: /s/ JOHN J. SULLIVAN ----------------------------------- Name: John J. Sullivan Title: Joint General Manager 254 CYPRESSTREE INVESTMENT MANAGEMENT COMPANY, INC. As: Attorney-in-Fact and on behalf of First Allmerica Financial Life Insurance Company By: /s/ JOHN W. FRASER ----------------------------------- Name: John W. Fraser Title: Managing Director 255 CREDIT SUISSE FIRST BOSTON By: /s/ TODD C. MORGAN ----------------------------------- Name: Todd C. Morgan Title: Vice President By: /s/ JUDITH E. SMITH ----------------------------------- Name: Judith E. Smith Title: Director 256 BANK OF MONTREAL By: /s/ W.T. CALDER ----------------------------------- Name: W.T. Calder Title: Director 257 COMPAGNIE FINANCIERE DE CIC ET DE L'UNION EUROPEENNE By: /s/ MARCUS EDWARD ----------------------------------- Name: Marcus Edward Title: Vice President By: /s/ BRIAN O'LEARY ----------------------------------- Name: Brian O'Leary Title: Vice President 258 THE DAI ICHI KANGYO BANK, LTD. NEW YORK BRANCH By: /s/ KAZUKI SHIMIZU ----------------------------------- Name: Kazuki Shimizu Title: Assistant Vice President 259 MERITA BANK LTD NEW YORK BRANCH By: /s/ FRANK MAFFEI ----------------------------------- Name: Frank Maffei Title: Vice President By: /s/ CLIFFORD ABRAMSKY ----------------------------------- Name: Clifford Abramsky Title: Vice President EX-10.2 4 SENIOR CREDIT AGREEMENT 1 EXHIBIT 10.2 ================================================================================ SENIOR CREDIT AGREEMENT dated as of June 26, 1997 among CHANCELLOR BROADCASTING COMPANY, as Borrower, THE LENDERS named herein and BANKERS TRUST NEW YORK CORPORATION, as Agent ================================================================================ 2 TABLE OF CONTENTS
Section Heading Page - ------- ------- ---- RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 SECTION 1 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.1. Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.2. Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 1.3. Other Definitional Provisions; Anniversaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 SECTION 2 AMOUNT AND TERMS OF BRIDGE LOAN COMMITMENT AND BRIDGE LOAN; NOTES . . . . . . . . . . . . . . . . . . . . 27 2.1. Bridge Loan and Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 A. Bridge Loan Commitment; Ranking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 B. Notice of Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 C. Disbursement of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 D. Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 E. Maturity of Bridge Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 F. Pro Rata Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 2.2. Interest on the Bridge Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 A. Rate of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 B. Interest Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 C. Post-Maturity Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 2.3. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 2.4. Prepayments and Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 A. Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 B. Manner and Time of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 C. Payments on Non-Business Days . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 D. Notation of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 2.5. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 A. Bridge Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 B. Margin Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 SECTION 3 CONDITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 3.1. Conditions to Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 SECTION 4 REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 4.1. Organization and Good Standing; Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 4.2. Authorization and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 4.3. No Conflicts or Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 4.4. Enforceable Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 4.5. Properties; Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 4.6. Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 4.7. Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
-i- 3 Section Heading Page - ------- ------- ---- 4.8. No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 4.9. Compliance with Contracts, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 4.10. No Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 4.11. Use of Proceeds; Margin Stock, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 4.12. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 4.13. ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 4.14. Compliance with Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 4.15. Government Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 4.16. Capital Structure and Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 4.17. Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 4.18. Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 4.19. Survival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 4.20. Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 4.21. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 4.22. Labor Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 4.23. Broker's or Finder's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 SECTION 5 AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 5.1. Financial Statements and Other Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 5.2. Corporate Existence, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 5.3. Payment of Taxes and Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 5.4. Maintenance of Properties; Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 5.5. Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 5.6. Equal Security for Loan and Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 5.7. Compliance with Laws, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57 5.8. Maintenance of Accurate Records, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57 5.9. ERISA Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57 5.10. Register . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 5.11 Environmental Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 SECTION 6 NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 6.1. Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 6.2. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 6.3. Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63 6.4. Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 6.5. Contingent Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 6.6. Restriction on Fundamental Changes, Asset Purchases or Sales . . . . . . . . . . . . . . . . . . . . . 67 6.7. Limitation on Dividend and Other Payment Restrictions Affecting Subsidiaries . . . . . . . . . . . . . 68 6.8. Restrictions on Additional Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69 6.9. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69 6.10. Subsidiary Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 6.11. Business Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 6.12. Asset Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
-ii- 4 Section Heading Page - ------- ------- ---- SECTION 7 EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72 7.1. Failure To Make Payments When Due . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72 7.2. Default in Other Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 7.3. Breach of Certain Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 7.4. Breach of Warranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 7.5. Other Defaults Under This Agreement or the Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 7.6. FCC Denial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 7.7. Involuntary Bankruptcy; Appointment of Custodian, Etc. . . . . . . . . . . . . . . . . . . . . . . . . 74 7.8. Voluntary Bankruptcy; Appointment of Custodian, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . 74 7.9. Judgments and Attachments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74 7.10. Dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75 SECTION 8 THE AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75 8.1. Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75 8.2. Delegation of Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75 8.3. Exculpatory Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 8.4. Reliance by Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 8.5. Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 8.6. Nonreliance on Agent and Other Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 8.7. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78 8.8. Agent in Its Individual Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78 8.9. Resignation of the Agent; Successor Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79 SECTION 9 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79 9.1. Representation of the Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79 9.2. Participations in and Assignments or Syndication of the Bridge Loan and Notes . . . . . . . . . . . . . 79 9.3. Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 9.4. Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 9.5. Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 9.6. Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 9.7. Independence of Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84 9.8. Entirety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84 9.9. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84 9.10. Survival of Warranties and Certain Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85 9.11. Failure or Indulgence Not Waiver; Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . 85 9.12. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85 9.13. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85 9.14. Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86 9.15. Successors and Assigns; Subsequent Holders of Notes . . . . . . . . . . . . . . . . . . . . . . . . . 86 9.16. Counterparts; Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
-iii- 5 Section Heading Page - ------- ------- ---- 9.17. Consent to Jurisdiction; Venue; Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . . 86 9.18. Payments Pro Rata . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87 9.19. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 9.20. Waiver of Stay, Extension or Usury Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 9.21. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 9.22. Judgment Currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92 9.23. Replacement of Lenders Under Certain Circumstances. . . . . . . . . . . . . . . . . . . . . . . . . . 92 SIGNATURE PAGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SCHEDULES A EXISTING LIENS B EXISTING INVESTMENTS C INTELLECTUAL PROPERTY D ENVIRONMENTAL MATTERS E PERMITS F EXISTING INDEBTEDNESS EXHIBITS I FORM OF BRIDGE NOTE II FORM OF COMPLIANCE CERTIFICATE III FORM OF NOTICE OF BORROWING IV FORM OF OPINION OF WEIL, GOTSHAL & MANGES LLP - COUNSEL FOR THE COMPANY V FORM OF OPINION OF CAHILL GORDON & REINDEL - COUNSEL FOR THE LENDER VI OFFICERS' CERTIFICATE VII SECRETARY CERTIFICATE
-iv- 6 This Senior Credit Agreement is dated as of June 26, 1997, and entered into by and among CHANCELLOR BROADCASTING COMPANY, a Delaware corporation (the "Company"), the Lenders named on the signature pages hereto (collectively, the "Lenders") and Bankers Trust New York Corporation ("Bankers Trust"), as agent for the Lenders (in such capacity, the "Agent"). RECITALS WHEREAS, the Company desires that the Lenders extend a senior credit facility to the Company in connection with the Acquisition (as defined herein); NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereby agree as follows: SECTION 1 DEFINITIONS 1.1. Certain Defined Terms The following terms used in this Agreement shall have the following meanings: "Acquisition" means the acquisition pursuant to the Acquisition Agreement by Chancellor of certain subsidiaries of Viacom International Inc. that own and operate radio broadcast stations in Los Angeles, California, Chicago, Illinois, and Detroit, Michigan. "Acquisition Agreement" means the Joint Purchase Agreement dated February 19, 1997 by and between the Company, Chancellor, Evergreen and Evergreen L.A. relating to the Acquisition. "Affiliate," as applied to any Person, means any other Person directly or indirectly controlling, controlled by or under common control with, that Person. For the purposes of this definition, "control" (including with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as applied to any Person, means (i) the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities or by contract or otherwise, or (ii) the ownership of more than 10% of the voting securities of that Person; provided that neither Bankers Trust nor any of its Affiliates shall be treated as an Affiliate of the Company or of any Subsidiary of the Company. "Agent" has the meaning ascribed to such term in the introduction to this Agreement. 7 -2- "Agreement" means this Senior Credit Agreement dated as of June 26, 1997, as it may be amended, supplemented or otherwise modified from time to time in accordance with the terms hereof. "Amount of Unfunded Benefit Liability" means, with respect to any Pension Plan, (i) if set forth on the most recent actuarial valuation report with respect to such Pension Plan, the amount of unfunded benefit liabilities (as defined in Section 4001(a)(18) of ERISA) and (ii) otherwise, the excess of (a) the greater of the current liability (as defined in Section 412(l)(7) of the Internal Revenue Code) or the actuarial present value of the accrued benefits with respect to such Pension Plan over (b) the market value of the assets of such Pension Plan. "Asset Sale" means any direct or indirect sale, issuance, conveyance, lease, assignment, transfer or other disposition for value (including, without limitation, pursuant to any amalgamation, merger or consolidation or pursuant to any sale-and-leaseback transaction, but excluding the granting of any Lien), not including the granting of a Lien, by the Company or by any of its Subsidiaries to any Person other than the Company or any of its Wholly Owned Subsidiaries (any such transaction, a "disposition") of (i) any of the stock of any of the Company's Subsidiaries, (ii) substantially all of the assets of any division or line of business of the Company or of any of its Subsidiaries or (iii) any other assets (whether tangible or intangible) of the Company or of any of its Subsidiaries; excluding any disposition of stock or assets in any single transaction or related series of transactions the aggregate value of which is equal to $1,000,000 or less. "Bank Financing" means the secured loan facilities made available to Chancellor in the committed amount of $750 million pursuant to the Bank Financing Documents. "Bank Financing Document" means the Amended and Restated Credit Agreement among the Company, Chancellor, various Banks, Goldman Sachs Credit Partners L.P., as Documentation Agent, NationsBank of Texas, N.A. and Toronto Dominion (Texas), Inc., as Syndication Agent and Bankers Trust Company, as Managing Agent and Arranger, dated as of February 14, 1996 and Amended and Restated as of January 23, 1997 and further Amended and Restated as of July 2, 1997, relating to the Bank Financing and the other related documents executed in connection therewith, in each case as in effect on the Closing Date. "Bankers Trust" means Bankers Trust New York Corporation, as Agent for the Lenders hereunder. 8 -3- "Bankruptcy Law" means Title 11 of the United States Code entitled "Bankruptcy," as now and hereafter in effect, or any successor statute or any other United States federal, state or local law or the law of any other jurisdiction relating to bankruptcy, insolvency, winding-up, liquidation, reorganization or relief of debtors, whether in effect on the date hereof or hereafter. "Bankruptcy Order" means any court order made in a proceeding pursuant to or within the meaning of any Bankruptcy Law, containing an adjudication of bankruptcy or insolvency, or providing for liquidation, winding-up, dissolution or reorganization, or appointing a custodian of a debtor or of all or any substantial part of a debtor's property, or providing for the staying, arrangement, adjustment or composition of indebtedness or other relief of a debtor. "Board of Directors" means, with respect to any Person, the Board of Directors of such Person or any duly authorized committee of that Board. "Borrowing" shall mean the borrowing of a Bridge Loan from all of the Lenders having a Bridge Loan Commitment on a given date. "Bridge Commitment Letter" means the letter dated May 30, 1997 governing the commitment of Bankers Trust to provide the Bridge Loan to the Company. "Bridge Loan" has the meaning ascribed to such term in Section 2.1A. "Bridge Loan Commitment" has the meaning ascribed to such term in Section 2.1A. "Business Day" means any day excluding Saturday, Sunday and any day that is a legal holiday under the laws of New York, New York or is a day on which banking institutions therein located are authorized or required by law or other governmental action to close. "Capital Lease," as applied to any Person, means any lease of any property (whether real, personal or mixed) by that Person as lessee that, in conformity with GAAP, is required to be accounted for as a capital lease on the balance sheet of that Person. "Capital Stock" means (i) with respect to any Person that is a corporation, any and all shares, interests, participations or other equivalents (however designated and whether or not voting) of corporate stock, including, without limitation, each class of Common Stock and Preferred Stock of such Person 9 -4- and (ii) with respect to any Person that is not a corporation, any and all partnership or other equity interests of such Person. "Capitalized Lease Obligation" means obligations under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP, and the amount of Indebtedness represented by such obligations shall be the capitalized amount of such obligations determined in accordance with GAAP. "Cash Equivalents" means (i) marketable direct obligations issued by, or unconditionally guaranteed by, the United States Government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition thereof; (ii) marketable direct obligations issued by any state of the United States of America or any political subdivision of any such state or any public instrumentality thereof maturing within one year from the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either Standard & Poor's Corporation or Moody's Investors Service, Inc.; (iii) commercial paper maturing no more than one year from the date of creation thereof and, at the time of acquisition, having a rating of at least A-1 from Standard & Poor's Corporation or at least P-1 from Moody's Investors Service, Inc.; (iv) certificates of deposit or bankers' acceptances maturing within one year from the date of acquisition thereof issued by any commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia or any U.S. branch of a foreign bank having at the date of acquisition thereof combined capital and surplus of not less than $200,000,000; (v) repurchase obligations with a term of not more than ninety days for underlying securities of the types described in clause (i) above entered into with any bank meeting the qualifications specified in clause (iv) above; and (vi) investments in money market funds that invest substantially all their assets in securities of the types described in clauses (i) through (v) above. "Cash Proceeds" means, with respect to any Asset Sale, cash payments (including any cash received by way of deferred payment pursuant to, or amortization of, a note receivable or otherwise but only as and when so received) received from such Asset Sale. "CERCLA" means the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as the same may be amended from time to time, 42 U.S.C. Section 9601 et seq. 10 -5- "Chancellor" means Chancellor Radio Broadcasting Company, a Delaware corporation and wholly owned subsidiary of the Company. "Chancellor Broadcasting Licensee" means Chancellor Broadcasting Licensee Company, a Delaware corporation. "Chancellor Indentures" means the indenture dated as of February 14, 1996 by and among Chancellor, the guarantor named therein and U.S. Trust Company of Texas, N.A. as trustee, under which Chancellor's 9 3/8% Senior Subordinated Notes due 2004 were issued as in effect on the date hereof and the indenture dated as of June 24, 1997 by and among Chancellor, the guarantors named therein and U.S. Trust Company of Texas, N.A. as trustee, under which Chancellor's 8 3/4% Senior Subordinated Notes due 2007 were issued as in effect on the date hereof. "Chancellor Media" means Chancellor Media Corporation as the survivor of the Evergreen Merger. "Change of Control" means (i) the Company shall cease to own beneficially 100% of the capital stock (other than the Series A Exchangeable Preferred Stock and the Exchangeable Preferred Stock) of Chancellor, or Chancellor or a Wholly Owned Subsidiary of the Company shall cease to own beneficially 100% of the capital stock of the Chancellor Broadcasting Licensee, (ii) for any reason whatsoever any "Person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), excluding HM Group, is or becomes the "beneficial owner" (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of more than the greater of (x) 15% of the then outstanding Voting Stock of the Company or (y) the percentage of the then outstanding Voting Stock of the Company owned beneficially by the HM Group, (iii) the Board of Directors of the Company shall cease to consist of a majority of Continuing Directors, (iv) a "Change of Control" under and as defined in the Series A Exchangeable Preferred Stock Documents, the Exchangeable Preferred Stock Documents or after any issuance thereof, the 12-1/4% Junior Exchange Debentures or 12% Junior Exchange Debentures shall have occurred or (v) the Evergreen Transaction shall have been consummated. "Change of Control Date" has the meaning ascribed to such term in Section 2.4A(iv). "Change of Control Offer" has the meaning ascribed to such term in Section 2.4A(iv). "Closing Date" means July 2, 1997. "Commission" means the Securities and Exchange Commission. 11 -6- "Common Stock" of any Person means any and all shares, interests or other participations in, and other equivalents (however designated and whether voting or non-voting) of, such Person's common stock, whether outstanding on the Closing Date or issued after the Closing Date, and includes, without limitation, all series and classes of such common stock. "Communications Act" means the Communications Act of 1934, as amended, and any successor statute. "Company" has the meaning ascribed to such term in the introduction to this Agreement. "Compliance Certificate" means a certificate substantially in the form of Exhibit II delivered to the Agent by the Company pursuant to Section 5.1(vi)(b). "Contested Claim" means any Tax, Indebtedness or other claim or liability (i) the validity or amount of which is being diligently contested in good faith, (ii) for which adequate reserve, or other appropriate provision, if any, as required in conformity with GAAP shall have been made and (iii) with respect to which any right to execute upon or sell any assets of the Company or of any of its Subsidiaries has not matured or has been and continues to be effectively enjoined, superseded or stayed. "Contingent Obligation," as applied to any Person, means any direct or indirect liability, contingent or otherwise, of that Person (i) with respect to any Indebtedness, lease, dividend or other obligation of another if the primary purpose or intent thereof by the Person incurring the Contingent Obligation is to provide assurance to the obligee of such obligation of another that such obligation of another will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such obligation will be protected (in whole or in part) against loss in respect thereof, (ii) with respect to any letter of credit issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings or (iii) under Interest Rate Agreements and Currency Agreements. Contingent Obligations shall include, without limitation, (a) the direct or indirect guaranty, endorsement (otherwise than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligation of another, (b) the obligation to make take-or-pay or similar payments if required regardless of non-performance by any other party or parties to an agreement, and (c) any liability of such Person for the obligation of another through any agreement (contingent or otherwise) (X) to purchase, repurchase or otherwise acquire such obligation or any security therefor, or to provide funds for the payment or dis- 12 -7- charge of such obligation (whether in the form of loans, advances, stock purchases, capital contributions or otherwise) or (Y) to maintain the solvency or any balance sheet item, level of income or financial condition of another if, in the case of any agreement described under subclauses (X) or (Y) of this sentence, the primary purpose or intent thereof is as described in the preceding sentence, provided, however, that the term "Contingent Obligation" shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Contingent Obligation shall be equal to the amount of the obligation so guaranteed or otherwise supported or, if less, the maximum reasonably anticipated liability in respect thereto (assuming the primary obligor is required to perform thereunder) as determined in good faith. "Continuing Director" means, as of the date of determination, any Person who (i) was a member of the Board of Directors of the Company on the Closing Date, (ii) was nominated for election or elected to the Board of Directors of the Company with the affirmative vote of a majority of the Continuing Directors who were members of such Board of Directors at the time of such nomination or election or (iii) is a member of the HM Group. "Contractual Obligation," as applied to any Person, means any provision of any Securities issued by that Person or of any indenture, mortgage, deed of trust, contract, undertaking, agreement or other instrument to which that Person is a party or by which it or any of its properties is bound or to which it or any of its properties is subject. "Controlled Group" means (i) a controlled group of corporations as defined in Section 1563(a) of the Internal Revenue Code or (ii) a group of trades or businesses under common control, as defined in Section 414(c) of the Internal Revenue Code, of which the Company is a part or becomes a part. "Covered Taxes" shall have the meaning ascribed to such term in Section 9.19. "Currency Agreement" means any foreign exchange contract, currency swap agreement, futures contract, option contract, synthetic cap or other similar agreement or arrangement designed to protect the Company against fluctuations in currency values. "Custodian" means any receiver, interim receiver, receiver and manager, trustee, assignee, liquidator, sequestrator or similar official charged with maintaining possession or control over property for one or more creditors, whether under any Bankruptcy Law or otherwise. 13 -8- "Defaulting Lender" means any Lender with respect to which a Lender Default is in effect. "Dinetz" means Mr. Steven Dinetz. "Disqualified Capital Stock" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event (other than an event that would constitute a Change of Control), (i) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the sole option of the holder thereof (except upon the occurrence of a Change of Control), in whole or in part, on or prior to the final maturity date of the Notes or (ii) is convertible into or exchangeable for (at the option of the holder thereof) (a) debt securities or (b) any Capital Stock referred to in (i) above, in each case at any time prior to the final maturity of the Notes; provided that only the portion of Capital Stock that so matures or is mandatorily redeemable, is so convertible or exchangeable or is so redeemable at the option of the holder thereof prior to such final maturity date shall be deemed to be Disqualified Capital Stock. "Dollars" or the sign "$" means the lawful money of the United States of America. "Eligible Assignee" means (A) (i) a commercial bank organized under the laws of the United States of America or any state thereof; (ii) a savings and loan association or savings bank organized under the laws of the United States or any state thereof; (iii) a commercial bank organized under the laws of any other country or a political subdivision thereof; provided that (x) such bank is acting through a branch or agency located in the United States or (y) such bank is organized under the laws of a country that is a member of the Organization for Economic Cooperation and Development or a political subdivision of such country; and (iv) any other entity that is an "accredited investor" (as defined in Regulation D under the Securities Act of 1933) that extends credit or buys loans as one of its businesses, including, but not limited to, insurance companies, mutual funds and lease financing companies, in each case (under clauses (i) through (iv) above) that is reasonably acceptable to the Company and the Agent; and (B) the Lenders and any Affiliate of the Lenders. "EMHC" means Evergreen Mezzanine Holdings Corporation, a Delaware corporation and wholly owned subsidiary of Evergreen. "Employee Benefit Plan" means any "employee benefit plan" as defined in Section 3(3) of ERISA (i) that is, or, at any time within the five calendar years immediately preceding 14 -9- the date hereof, was at any time, maintained or contributed to by the Company or Chancellor or any of their respective ERISA Affiliates or (ii) with respect to which the Company or its Subsidiaries retains any liability, including any potential joint and several liability as a result of an affiliation with an ERISA Affiliate or a party that would be an ERISA Affiliate except for the fact the affiliation ceased more than five calendar years prior to the date hereof. "Environmental Claim" means any and all administrative, regulatory or judicial actions, suits, demand letters, directives, claims, liens, notices of noncompliance or violation, investigations or proceedings relating in any way to any Environmental Law or any permit issued, or any approval given, under any such Environmental Law (hereafter, "Claims"), including, without limitation, (a) any and all Claims by governmental or regulatory authorities for enforcement, cleanup, removal, response, remedial or other actions or damages (including, without limitation, natural resource damages), cost recovery, or fines or other penalties pursuant to any applicable Environmental Law, and (b) and all Claims by any third party seeking damages including, without limitation, natural resource damages), cost recovery, or fines or other penalties], contribution, indemnification, cost recovery, compensation, injunctive relief in connection with alleged injury or threat of injury to health, safety or the environment due to the presence of Hazardous Materials (including, without limitation, the emission, discharge, release, threatened release, use, handling, transportation, storage or disposal of Hazardous Materials). "Environmental Law" means any applicable Federal, state, foreign or local statute, law, rule, regulation, ordinance, code, binding and enforceable guideline or written policy, and any rule of common law, in the case of each of the foregoing now or hereafter in effect and in each case as amended, and any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment, to the extent such order, decree or judgment is binding on the Company or Chancellor, relating to the environment, employee health and safety or Hazardous Material, including, without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33 U.S.C. Section 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. Section 3803 et seq.; the Oil Pollution Act of 1990, 33 U.S.C. Section 2701 et seq.; the Emergency Planning and the Community Right-to-Know Act of 1986, 42 U.S.C. Section [11001] et seq.; the Hazardous materials Transportation Act, 49 U.S.C. Section 1801 et seq.; and the Occupational Safety and Health Act, 29 U.S.C. Section 651 et seq.; (to the extent it regulates occupational exposure to Hazardous Materials); and any state or local coun- 15 -10- terparts or equivalents, in each case as amended from time to time. "Environmental Lien" means a Lien in favor of a Tribunal or other Person (i) for any liability under an Environmental Law or (ii) for damages arising from or costs incurred by such Tribunal or other Person in response to a release or threatened release of hazardous or toxic waste, substance or constituent into the environment. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, and any successor statute. "ERISA Affiliate," as applied to any Person, means (i) any corporation that is, or was at any time within the five calendar years immediately preceding the date hereof, a member of a controlled group of corporations within the meaning of Section 414(b) of the Internal Revenue Code of which that Person is, or was at any time within the five calendar years immediately preceding the date hereof, a member; (ii) any trade or business (whether or not incorporated) that is, or was at any time within the five calendar years immediately preceding the date hereof, a member of a group of trades or businesses under common control within the meaning of Section 414(c) of the Internal Revenue Code of which that Person is, or was at any time within the five calendar years immediately preceding the date hereof, a member; and (iii) any member of an affiliated service group within the meaning of Section 414(m) or (o) of the Internal Revenue Code of which that Person, any corporation described in clause (i) above or any trade or business described in clause (ii) above is, or was at any time within the five calendar years immediately preceding the date hereof, a member. "ERISA Event" means (i) a Reportable Event; (ii) the failure to meet the minimum funding standard of Section 412 of the Internal Revenue Code with respect to any Pension Plan (whether or not waived in accordance with Section 412(d) of the Internal Revenue Code) or the failure to make by its due date a required installment under Section 412(m) of the Internal Revenue Code with respect to any Pension Plan or the failure to make any required contribution to a Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress termination described in Section 4041(c) of ERISA; (iv) the withdrawal by the Company or any of its respective ERISA Affiliates from any Pension Plan with two or more contributing sponsors or the termination of any such Pension Plan resulting in liability pursuant to Sections 4063 or 4064 of ERISA; (v) the institution by the PBGC of 16 -11- proceedings to terminate any Pension Plan, or the occurrence of any event or condition which might reasonably be expected to constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan; (vi) the imposition of liability on the Company or any of its respective ERISA Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of Section 4212(c) of ERISA; (vii) the withdrawal by the Company or any of its respective ERISA Affiliates in a complete or partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any potential liability therefor, or the receipt by the Company or any of its respective ERISA Affiliates of notice from any Multiemployer Plan that it is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the occurrence of an act or omission that could reasonably be expected to give rise to the imposition on the Company or any of its respective ERISA Affiliates of material fines, penalties, taxes or related charges under Chapter 43 of the Internal Revenue Code or under Section 409 or 502(c), (i) or (l) or 4071 of ERISA in respect of any Employee Benefit Plan; (ix) the assertion of a material claim (other than routine claims for benefits) against any Employee Benefit Plan other than a Multiemployer Plan or the assets thereof, or against the Company or any of its respective ERISA Affiliates in connection with any such Employee Benefit Plan; (x) receipt from the Internal Revenue Service of notice of the failure of any Pension Plan (or any other Employee Benefit Plan intended to be qualified under Section 401(a) of the Internal Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or the failure of any trust forming part of any Pension Plan to qualify for exemption from taxation under Section 501(a) of the Internal Revenue Code; or (xi) the imposition of a material Lien pursuant to Section 401(a)(29) or 412(n) of the Internal Revenue Code or pursuant to ERISA with respect to any Pension Plan. "Event of Default" means each of the events set forth in Section 7. "Evergreen" means Evergreen Media Corporation, a Delaware corporation and the direct or indirect holding company of Evergreen L.A. "Evergreen L.A." means Evergreen Media Corporation of Los Angeles, a Delaware corporation. "Evergreen Merger" means each of (i) the merger of the Company with and into EMHC with EMHC as the surviving company and the merger of Chancellor with and into Evergreen L.A. with Evergreen L.A. as the surviving company, each pursuant to the Merger Agreement. 17 -12- "Evergreen-Viacom Acquisition" means the acquisition by Evergreen of the radio broadcasting assets of Viacom International Inc. relating to operations in New York, New York, and Washington, D.C. "Evergreen-Viacom Acquisition Agreements" has the meaning ascribed to such term in Section 3.1H. "Evergreen-Viacom Transactions" means the Evergreen Viacom Acquisition and the related financing. "Exchange Act" means the Securities Exchange Act of 1934, as amended, and any successor statute. "Exchangeable Preferred Stock" shall mean Chancellor's 12% Exchangeable Preferred Stock due 2009. "Exchangeable Preferred Stock Documents" shall mean each document relating to the Exchangeable Preferred Stock (including, without limitation, the 12% Junior Exchange Debenture Indenture and all documents relating thereto). "Facilities" means any and all real property (including, without limitation, all buildings, fixtures or other improvements located thereon) now, hereafter or heretofore owned, leased, operated or used by the Company, its Subsidiaries or any of their respective predecessors in interest. "FCC" shall mean the Federal Communications Commission or any successor thereto. "Foreign Plans" means any plan, program, policy, arrangement or agreement maintained or contributed to by, or entered into with, either the Company or Chancellor with respect to employees employed outside the United States. "GAAP" means those generally accepted accounting principles and practices that are recognized as such by The Financial Accounting Standards Board and that are consistently applied for all periods after the date hereof so as to properly reflect the financial conditions, and the results of operations and changes in financial position, of the Company and its Subsidiaries, except that any accounting principle or practice changed with the concurrence of the Company's independent public accountants or required to be changed in order to continue as a generally accepted accounting principle or practice may be so changed. "Hazardous Material" means (a) any petroleum or petroleum products, radioactive materials, asbestos in any form that is or could become friable, urea formaldehyde foam insulation, transformers or other equipment that contain dielectric 18 -13- fluid containing levels of polychlorinated biphenyls, and radon gas, and (b) any chemicals, materials or substances defined as or included in the definition of "hazardous substances," "hazardous waste," "hazardous materials," "extremely hazardous substances," "restricted hazardous waste," "toxic substances," "toxic pollutants," "contaminants," or "pollutants," or words of similar import, under any applicable Environmental Law. "HM Group" shall mean, collectively, (i) Hicks, Muse, Tate & Furst Incorporated, its Affiliates and Dinetz taken as a whole, (ii) so long as Hicks, Muse, Tate & Furst Incorporated, its Affiliates and Dinetz taken as a whole possess sole voting right with respect to the Voting Stock held by each such individual, such individuals who are or were employees, officers, directors or partners of Hicks, Muse, Tate & Furst Incorporated or such Affiliate and the family members of such individuals or trusts created for the sole benefit of such family members and (iii) so long as Hicks, Muse, Tate & Furst Incorporated, its Affiliates and Dinetz taken as a whole possess sole voting right with respect to the Voting Stock of Holdings held by each such Person, any Person not otherwise described by clauses (i) and (ii) above, provided that the aggregate number of shares held by all such Persons in accordance with this clause (iii) at any time shall not exceed 3% of the aggregate number of shares held by the Persons described in clauses (i) and (ii) above at such time. "Incur" means, with respect to any Indebtedness or other obligation of any Person, to create, issue, incur (by conversion, exchange or otherwise), assume, guarantee or otherwise become liable in respect of such Indebtedness or other obligation or the recording, as required pursuant to GAAP or otherwise, of any such Indebtedness or other obligation on the balance sheet of such Person (and "Incurrence," "Incurred," "Incurrable" and "Incurring" shall have meanings correlative to the foregoing); provided that any amendment, modification or waiver of any document pursuant to which Indebtedness was previously Incurred shall only be deemed to be an Incurrence of Indebtedness if and to the extent such amendment, modification or waiver (i) increases the principal thereof or interest rate or premium payable thereon or (ii) changes to an earlier date the stated maturity thereof or accelerates the time within which such Indebtedness shall be redeemed other then in connection with a Permitted Refinancing; provided, further, that any Indebtedness of a Person existing at the time such Person becomes a Subsidiary of the Company (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Subsidiary at the time it becomes a Subsidiary of the Company. "Indebtedness" means, with respect to any Person, without duplication, (i) all indebtedness, obligations and li- 19 -14- abilities of such Person for borrowed money, (ii) that portion of obligations with respect to Capital Leases that is properly classified as a liability on a balance sheet of such Person in conformity with GAAP, (iii) notes payable and drafts accepted representing extensions of credit, whether or not representing obligations for borrowed money, of such Person, (iv) any indebtedness, obligation or liability of such Person owed for all or any part of the deferred purchase price of property or services (excluding any such obligations incurred under ERISA), which purchase price is (a) due more than six months (or a longer period of up to one year, if such terms are available from suppliers in the ordinary course of business) from the date of incurrence of the obligation in respect thereof or (b) evidenced by a note or similar written instrument, (v) all indebtedness, obligations and liabilities secured by any Lien on any property or asset owned or held by that Person regardless of whether the indebtedness secured thereby shall have been assumed by that Person or is nonrecourse to the credit of that Person, except that "Indebtedness" shall not include trade payables and accrued liabilities incurred in the ordinary course of business for the purchase of goods or services that are not secured by a Lien other than Liens permitted under Section 6.2 and obligations under Interest Rate Agreements and Currency Agreements (which constitute Contingent Obligations, not Indebtedness), (vi) guarantees of such Person in respect of Indebtedness of other Persons and (vii) all Disqualified Capital Stock issued by such Person with the amount of Indebtedness represented by such Disqualified Capital Stock being equal to the greater of its voluntary or involuntary liquidation preference and its maximum fixed repurchase price, but excluding accrued dividends, if any. For purposes hereof, the "maximum fixed repurchase price" of any Disqualified Capital Stock that does not have a fixed repurchase price shall be calculated in accordance with the terms of such Disqualified Capital Stock as if such Disqualified Capital Stock were purchased on any date on which Indebtedness shall be required to be determined pursuant to this Agreement, and if such price is based upon, or measured by, the fair market value of such Disqualified Capital Stock, such fair market value to be determined reasonably and in good faith by the board of directors of the issuer of such Disqualified Capital Stock. "Indemnified Liabilities" has the meaning ascribed to such term in Section 9.4. "Indemnitees" has the meaning ascribed to such term in Section 9.4. "Independent Financial Advisor" means a firm (i) that does not, and whose directors, officers and employees or Affiliates do not, have a direct or indirect financial interest in the Company or its Subsidiaries and (ii) that, in the judg- 20 -15- ment of the Board of Directors of the Company, is otherwise independent and qualified to perform the task for which it is to be engaged. "Intellectual Property" means all patents, trademarks, tradenames, copyrights, technology, know-how and processes used in or necessary for the conduct of the business of the Company and its Subsidiaries as currently conducted or as proposed to be conducted that are material to the condition (financial or otherwise), business, operations or prospects of the Company and its Subsidiaries, taken as a whole. "Intercompany Indebtedness" means any Indebtedness of the Company or any Subsidiary of the Company that, in the case of the Company, is owing to any Wholly Owned Subsidiary of the Company and that, in the case of any such Subsidiary, is owing to the Company or any Wholly Owned Subsidiary of the Company; provided that if as of any date any Person other than the Company or a Wholly Owned Subsidiary of the Company owns or holds such Indebtedness, or holds any Lien in respect thereof, such Indebtedness shall no longer be Intercompany Indebtedness permitted to be Incurred pursuant to Section 6.1(iv). "Interest Rate Agreement" means any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement or other similar agreement or arrangement designed to protect Company or any of its Subsidiaries against fluctuations in interest rates. "Interest Rate Determination Date" means, with respect to any Quarterly Period, the second Business Day on which banks in New York and London are open prior to the first Business Day of such Quarterly Period. "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended from time to time, and any successor code or statute. "Investment" means (i) any direct or indirect purchase or other acquisition of, or of a beneficial interest in, any Securities of any other Person or (ii) any direct or indirect loan, advance (other than advances to employees for moving, entertainment and travel expenses, drawing accounts and similar expenditures in the ordinary course of business), extension of credit or capital contribution to any other Person, including all indebtedness and accounts receivable from that other Person that are not current assets or did not arise from sales to that other Person in the ordinary course of business. The amount of any Investment shall be the original cost of such Investment plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write-ups, write-downs or write-offs with respect to such Investment. 21 -16- "Joint Venture" means a joint venture, partnership or other similar arrangement, whether in corporate, partnership or other legal form; provided that, as to any such arrangement in corporate form, such corporation shall not, as to any Person of which such corporation is a Subsidiary, be considered to be a Joint Venture to which such Person is a party. "Judgment Currency" shall have the meaning ascribed to such term in Section 9.22. "Laws" means all applicable statutes, laws, ordinances, regulations, rules, orders, judgments, writs, injunctions or decrees of any state, commonwealth, nation, territory, possession, province, county, parish, town, township, village, municipality or Tribunal, and "Law" means each of the foregoing. "Lender Default" shall mean (i) the refusal (which has not been retracted) of a Lender to make available its portion of any Borrowing or (ii) a Lender having notified in writing the Borrower and/or the Agent that it does not intend to comply with its obligations under Section 2.1A as a result of any takeover of such Lender by any regulatory authority or agency. "Lenders" has the meaning ascribed to that term in the introduction to this Agreement and shall include any assignee of the Bridge Loan, the Notes or the Bridge Loan Commitment to the extent of such assignment. "Lien" means any lien, mortgage, pledge, assignment, security interest, charge or encumbrance of any kind (including any conditional sale or other title retention agreement, any lease in the nature thereof, and any agreement to give any security interest) and any option, trust or other preferential arrangement having the practical effect of any of the foregoing. "LIBOR" means for each Quarterly Period, the rate determined on the basis of the offered rates for deposits in Dollars for a period of three months that appear on the Reuters Screen LIBO Page as of 11:00 a.m., London time, on the Interest Rate Determination Date for such Quarterly Period. If at least two rates appear on the Reuters Screen LIBO Page, the rate for such Quarterly Period will be the arithmetic mean of such rates rounded upwards, if necessary, to the nearest 1/16 of 1%. If fewer than two rates appear on the Reuters Screen LIBO Page, then such rate shall equal the arithmetic mean (rounded upward to the nearest 1/16 of 1%) of the interest rates per annum at which deposits in Dollars for a period of three months are offered by Bankers Trust or its designees at approximately 11:00 22 -17- a.m., London time, on such Interest Rate Determination Date to first class banks in the London interbank market. "Litigation" means any action, suit, proceeding, claim, lawsuit and/or investigation conducted by or before any Tribunal. "Loan Documents" means this Agreement and the Notes. "Margin Stock" has the meaning assigned to that term in Regulation U and Regulation G of the Board of Governors of the Federal Reserve System as in effect from time to time. "Material Adverse Change" means a material adverse change in the business, operations, properties, assets, prospects or condition (financial or otherwise) of the Company and its Subsidiaries, taken as a whole. "Material Adverse Effect" means (i) a material adverse effect upon the business, operations, properties, assets, prospects or condition (financial or otherwise) of the Company and its Subsidiaries, taken as a whole, or (ii) the impairment of the ability of the Company and its Subsidiaries, taken as a whole, to perform, or the impairment of the ability of the Agent or Lenders to enforce, the Obligations. "Material Subsidiary" means, with respect to any accounting period, any Subsidiary of the Company (i) whose revenues constitute greater than 10% of the aggregate dollar value of the revenues of Company and its Subsidiaries, taken as a whole, for such accounting period or (ii) the fair market value of whose assets at any time during such accounting period is greater than 10% of the fair market value of all of the assets of Company and its Subsidiaries at such time. "Maturity Date" has the meaning ascribed to such term in Section 2.1E. "Maximum Cash Interest Rate" means an interest rate of 18% per annum; provided that in computing such interest rate, fees paid to the Lenders shall not be deemed an interest payment. "Merger Agreement" means the Agreement and Plan of Merger dated as of February 19, 1997 among Chancellor, the Company, Evergreen and Evergreen L.A., as such agreement may be amended, modified or supplemented from time to time. "Monitoring and Oversight Agreements" has the meaning ascribed to such term in Section 6.9(iv). 23 -18- "Multiemployer Plan" means a Pension Plan that is a "multiemployer plan" as defined in Section 4001(a)(3) of ERISA. "Net Cash Proceeds" means, with respect to any Asset Sale, (a) Cash Proceeds of such Asset Sale net of bona fide direct costs of such sale including, but not limited to, (i) income taxes reasonably estimated to be actually payable as a result of such Asset Sale within two years of the date of such Asset Sale, (ii) payment of the outstanding principal amount of, premium or penalty, if any, and interest on, any Indebtedness that is secured by a Lien on the stock or assets in question and (iii) reasonable transaction costs (including, without limitation, an underwriting, brokerage or other customary selling commissions and reasonable legal, advisory and other fees and expenses, including title and recording expenses and reasonable expenses incurred for preparing such assets for sale, associated therewith), and (b) excluding any portion of any such Cash Proceeds that the Company determines in good faith should be reserved for post-closing adjustments (to the extent that the Company delivers to the Lenders a certificate signed by an Officer as to such determination), it being understood and agreed that on the day that all such post-closing adjustments have been determined (which shall not be later than six months following the date of the respective asset sale), the amount (if any) by which the reserved amount in respect of such sale or disposition exceeds the actual post-closing adjustments payable by the Company or any of its Subsidiaries shall constitute Net Cash Proceeds on such date). "Notes" has the meaning ascribed to such term in Section 2.1D and shall include any Notes executed in connection with any assignment of the Bridge Loan, the Notes or the Bridge Loan Commitment, as applicable. "Notice of Borrowing" means a notice substantially in the form of Exhibit III with respect to a proposed borrowing. "Obligations" means all obligations of every nature of the Company from time to time owed to the Lenders under the Loan Documents, whether for principal, reimbursements, interest, fees, expenses, indemnities or otherwise, and whether primary, secondary, direct, indirect, contingent, fixed or otherwise (including obligations of performance). "Offer Payment Date" has the meaning ascribed to such term in Section 2.4A(iv). "Officer" means, as applicable to any corporation, the Chairman of the Board, the President, any Vice President, the Chief Financial Officer, the Controller, the Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of such corporation. 24 -19- "Officers' Certificate" means, as applied to any corporation, a certificate executed on behalf of such corporation by two Officers; provided that every Officers' Certificate with respect to the compliance with a condition precedent to the making of the Bridge Loan hereunder shall include (i) a statement that the officer or officers making or giving such Officers' Certificate have read such condition and any definitions or other provisions contained in this Agreement relating thereto, (ii) a statement that, in the opinion of the signers, they have made or have caused to be made such examination or investigation as is necessary to enable them to express an informed opinion as to whether or not such condition has been complied with and (iii) a statement as to whether, in the opinion of the signers, such condition has been complied with. "Original Credit Agreement" shall mean the Credit Agreement dated as of February 19, 1996 among the Company, Chancellor, the Banks (as defined therein) from time to time party thereto, and Bankers Trust Company, as Managing Agent. "Other Taxes" has the meaning ascribed to such term in Section 9.19. "Pari Passu Indebtedness" means, with respect to the Company, Indebtedness that ranks pari passu in right of payment with the Bridge Loan. "Payment Office" shall mean the office of the Agent located at One Bankers Trust Plaza, New York, New York 10006 or such other office as the Agent may designate to the Company and the Lenders from time to time. "Payment Restriction" has the meaning ascribed to such term in Section 6.7. "PBGC" means the Pension Benefit Guaranty Corporation and any successor to all or any of the Pension Benefit Guaranty Corporation's functions under ERISA. "Pension Plan" means an employee pension benefit plan as defined in Section 3(2) of ERISA that is subject to the provisions of Title IV of ERISA and that is maintained for employees of the Company, any Subsidiary of the Company or any member of the Controlled Group. "Permits" has the meaning ascribed to such term in Section 4.20. "Permitted Encumbrances" means (i) Liens existing on the Closing Date set forth on Schedule A to the extent and in the manner such Liens are in effect on the Closing Date; (ii) Liens for taxes, assessments or governmental charges or 25 -20- claims the payment of which is not, at the time, required by Section 5.3; (iii) statutory Liens of landlords and banks and rights of offset, and Liens of carriers, warehousemen, workmen, repairmen, mechanics and materialmen and other Liens imposed by law incurred in the ordinary course of business to secure such Indebtedness; provided, that such Liens (x) do not in the aggregate materially detract from the value of the Company's or such Subsidiary's property or assets or materially impair the use thereof in the operation of the business of the Company or such Subsidiary or (y) are the subject of a Contested Claim; (iv) Liens incurred or deposits made in the ordinary course of business in connection with workers' compensation, unemployment insurance and other types of social security, or to secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, leases, government contracts, trade contracts, utility payments, performance and return-of-money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money); (v) any attachment or judgment Lien not constituting an Event of Default; (vi) licenses, leases or subleases granted to others not interfering in any material respect with the ordinary conduct of the business of the Company and its Subsidiaries, taken as a whole; (vii) easements, rights-of-way, restrictions, minor defects, encroachments or irregularities in title and other similar charges or encumbrances not interfering in any material respect with the ordinary conduct of the business of the Company and its Subsidiaries, taken as a whole; (viii) any (a) interest or title of a lessor or sublessor, licensee or licensor under any lease or licenses agreement, (b) restriction or encumbrance that the interest or title of such lessor or sublessor, licensee or licensor may be subject to (including without limitation licenses agreements, ground leases or other prior leases of the demised premises, mortgages, mechanics' liens, tax liens, and easements), or (c) subordination of the interest of the lessee or sublessee under such lease to any restrictions or encumbrance referred to in the preceding clause (b); (ix) Liens arising from filing UCC financing statements for precautionary purposes relating solely to true leases of personal property permitted by this Agreement under which the Company or any of its Subsidiaries is a lessee; (x) any zoning or similar law or right reserved to or vested in any governmental office or agency to control or regulate the use of any real property; (xi) Liens securing obligations (other than obligations representing Indebtedness for borrowed money) under operating, reciprocal easement or similar agreements entered into in the ordinary course of business of the Company and its Subsidiaries; (xii) Liens upon specific items of inventory or other goods and proceeds of any Person securing such Person's obligations in respect of bankers' acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods in the ordinary course of business; (xiii) Liens securing reimbursement obligations 26 -21- with respect to letters of credit that encumber documents and other property relating to such letters of credit and the products and proceeds thereof; (xiv) Liens encumbering customary initial deposits and margin deposits, and other Liens incurred in the ordinary course of business that are within the general parameters customary in the industry, in each case securing Indebtedness under interest swap obligations and foreign exchange agreements and forward contracts, option futures contracts, futures options or similar agreements or arrangements designed to protect the Company or any Subsidiary from fluctuations in the price of commodities; (xv) Liens arising out of consignment or similar arrangements for the sale of goods entered into by the Company or any Subsidiary in the ordinary course of business in accordance with past practices; (xvi) Liens to secure Permitted Refinancing Indebtedness to the extent the Indebtedness Refinanced was secured and such Liens do not extend to any property other than the property that was subject to the Lien under the Indebtedness being Refinanced; (xvii) licenses of patents, trademarks and other intellectual property rights granted by the Company or any of its Subsidiaries in the ordinary course of business and not interfering in any material respect with the ordinary conduct of the business of the Company or any such Subsidiary; (xx) statutory, contractual and common law landlords' liens under leases to which the Company or any of its Subsidiaries is a party; and (xxi) Liens securing purchase money indebtedness. "Permitted Holders" means Hicks, Muse, Tate & Furst Incorporated and its Affiliates. "Permitted Indebtedness" has the meaning assigned to such term in Section 6.1. "Permitted Investments" means (a) Investments in cash and Cash Equivalents; (b) Investments by the Company or by any Subsidiary of the Company in any Person that is or will become immediately after such Investment a Wholly Owned Subsidiary of the Company that has not Incurred (and will not Incur as a result of or in connection with such transaction) any Indebtedness (other than Indebtedness permitted to be Incurred by such Subsidiary under Section 6.1); provided that (x) such Investment shall be a Permitted Investment only for so long as any such Subsidiary in which the Investment has been made meets the conditions set forth above and (y) no Investment in any such Person or Subsidiary (including any transaction pursuant to which any Person becomes a Subsidiary of the Company) will be a Permitted Investment if and for so long as such Subsidiary is or would be subject to any Payment Restriction not permitted by Section 6.7; (c) any Investments in the Company by any Subsidiary of the Company; provided that any Indebtedness of the Company for payment in respect of such Investment is subordinated in right of payment, pursuant to a written agreement, to the 27 -22- Company's Obligations; (d) Investments made by the Company or by its Subsidiaries out of the Net Cash Proceeds of an Asset Sale made in compliance with Section 6.12; and (e) Intercompany Indebtedness by and between the Company and its Subsidiaries. "Permitted Refinancing Indebtedness" means (A) any Refinancing by the Company of Indebtedness of the Company or of its Subsidiaries (other than Indebtedness Incurred or outstanding pursuant to clause (x) of Section 6.1, which Indebtedness shall remain subject to the maximum aggregate amounts outstanding as set forth therein) and (B) any Indebtedness incurred pursuant to a Refinancing by any Subsidiary of the Company of Indebtedness Incurred by such Subsidiary (other than Indebtedness Incurred or outstanding pursuant to clause (x) of Section 6.1, which Indebtedness shall remain subject to the maximum aggregate amounts outstanding as set forth therein), in the case of each of (A) and (B), that does not (1) result in an increase in the total of the aggregate principal amount of the Indebtedness of such Person being Refinanced as of the date of such proposed Refinancing (if such Indebtedness that is Refinancing the existing Indebtedness is issued at a price less than 100% of the principal amount thereof, an increase shall not be deemed to have occurred unless the gross proceeds of such Indebtedness that is Refinancing the existing Indebtedness is in excess of the total of the aggregate principal amount of the Indebtedness being Refinanced as of the date of such proposed Refinancing) or (2) create Indebtedness with a Weighted Average Life to Maturity that is less than the Weighted Average Life to Maturity of the Indebtedness being Refinanced; provided that (x) if such Indebtedness being Refinanced is Indebtedness of the Company, then such Refinancing Indebtedness shall be Indebtedness solely of the Company, (y) if such Indebtedness being Refinanced is subordinate or junior in right of payment to the Bridge Loan, as the case may be, or if recourse in respect of the Indebtedness being Refinanced is limited in any respect, then such Indebtedness proposed to be Incurred to Refinance the existing Indebtedness shall be subordinate in right of payment to the Bridge Loan and recourse with respect thereto shall be limited at least to the same extent and in the same manner as the Indebtedness being Refinanced and (z) if such Indebtedness being Refinanced is Pari Passu Indebtedness, then such Indebtedness proposed to be incurred to Refinance the existing Indebtedness shall be Pari Passu Indebtedness. "Person" means and includes natural persons, corporations, limited liability companies, limited partnerships, general partnerships, joint stock companies, joint ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts or other organizations, whether or not legal entities, and governments and agencies and political subdivisions thereof. 28 -23- "Plan" means an employee benefit plan as defined in Section 3(3) of ERISA maintained by the Company or any of its Subsidiaries for employees of the Company or any of its Subsidiaries. "Potential Event of Default" means a condition or event that, after notice or lapse of time or both, would constitute an Event of Default if that condition or event were not cured or removed within any applicable grace or cure period. "preferred stock" of any Person means any Capital Stock of such Person that has preferential rights (as compared to any other Capital Stock of such Person) with respect to dividends or redemptions or upon liquidation. "pro forma" means, with respect to any calculation made or required to be made pursuant to the terms of this Agreement, a calculation in accordance with Article 11 of Regulation S-X under the Securities Act of 1933, as amended, as interpreted by the Company's chief financial officer or Board of Directors in consultation with its independent certified public accountants. "Proceedings" has the meaning ascribed to such term in Section 5.1(xi). "Qualified Capital Stock" means any Capital Stock that is not Disqualified Capital Stock. "Quarterly Period" shall mean the period commencing on the first calendar day of each three-month period, if such day is a Business Day, or if such day is not a Business Day, the first Business Day succeeding the first calendar day of each three-month period and ending on the day next preceding the first Business Day of the following Quarterly Period. "RCRA" means the Resource Conservation and Recovery Act, as the same may be amended from time to time, 42 U.S.C. Section 6901 et seq. "Real Property" means real property, including, without limitation, improvements and fixtures thereon, owned, leased or operated by the Company or Chancellor. The term "Real Property" as used herein shall include the groundwater, surface water, soil and airspace at, in, on, under or adjacent to such Real Property. "Real Property Assets" means interests in land, buildings, improvements, and fixtures attached thereto or used in the operation thereof, in each case owned or leased (as lessee) by the Company or its Subsidiaries. 29 -24- "Refinance" means, in respect of any security or Indebtedness, to refinance, extend, renew, refund or defease, or to issue a security or Indebtedness in exchange or replacement for, such security or Indebtedness in whole or in part. "Refinanced" and "Refinancing" shall have correlative meanings. "Register" has the meaning ascribed to such term in Section 5.10. "Regulation G," "Regulation T," "Regulation U" and "Regulation X" shall mean Regulation G, T, U or X, as the case may be, of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof. "Related Business" means any capital expenditure or Investment in properties and assets that replace the properties and assets that were the subject of an Asset Sale or in properties and assets that will be used in the business of the Company and its Subsidiaries as existing on the Closing Date or in businesses reasonably related thereto. "Release" means any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing or migration into the environment. "Reportable Event" has the meaning set forth in Section 4043 of ERISA, but excluding any event for which the 30-day notice requirement has been waived by applicable regulations of the PBGC. "Required Lenders" means Lenders holding in the aggregate more than 50% of the outstanding principal amount of the Notes. "Restricted Payment" has the meaning ascribed to such term in Section 6.3. "Restricted Payment Capacity" has the meaning ascribed to such term in Section 3.1G. "Securities" means any stock, shares, partnership interests, voting trust certificates, certificates of interest or participation in any profit sharing agreement or arrangement, bonds, debentures, options, warrants, notes, or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as "securities" or any certificates of interest, shares or participations in temporary or interim certificates for the purchase or acquisition of, or any right to subscribe to, purchase or acquire, any of the foregoing. 30 -25- "Series A Exchangeable Preferred Stock" shall mean Chancellor's 12 1/4% Series A Cumulative Exchangeable Preferred Stock due 2008 issued concurrently with the Original Credit Agreement. "Series A Exchangeable Preferred Stock Documents" shall mean each document relating to the Series A Exchangeable Preferred Stock (including, without limitation, the 12-1/4% Junior Exchange Debenture Indenture and all documents relating thereto). "Stations" means and includes all of the radio stations owned and operated by the Company and Chancellor on the Closing Date, after giving effect to the Acquisition. "Subordinated Indebtedness" means Indebtedness of the Company that is expressly subordinated in right of payment to the Bridge Loan and the Notes. "Subsidiary" means, with respect to any Person, any corporation, association or other business entity of which more than 50% of the total voting power of shares of stock or other equity interest entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereto is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof; provided that for all purposes of this Agreement, unless the context otherwise requires, the Subsidiaries of the Company shall include Chancellor. "Syndicate Group" shall mean the initial group of participants in the Bridge Loan. "Tax Certificate" has the meaning ascribed to such term in Section 9.19F. "Tax Sharing Agreements" means all agreements relating to the sharing of tax liabilities and benefits among the Company and/or its Subsidiaries. "Taxes" means all taxes, assessments, fees, levies, imposts, duties, penalties, deductions, liabilities, withholdings or other charges of any nature whatsoever, including interest penalties, from time to time or at any time imposed by any Law or any Tribunal. "Total Bridge Loan Commitment" has the meaning ascribed to such term in Section 2.1A. "Transaction Costs" means the fees, costs and expenses payable by the Company pursuant hereto and other fees, 31 -26- costs and expenses payable by the Company in connection with the Transactions, including transaction or financial advisory fees payable to Permitted Holders and Greenhill & Co., LLC. "Transactions" shall mean, collectively, (i) the incurrence of the Bridge Loan hereunder on the Closing Date, (ii) the Acquisition, (iii) the Bank Financing, (iv) any other transaction on the Closing Date contemplated in relation to the foregoing and (v) the payment of fees and expenses in connection with the foregoing. "Transferee" has the meaning ascribed to such term in Section 9.19. "Tribunal" means any government, any arbitration panel, any court or any governmental department, commission, board, bureau, agency, authority or instrumentality of the United States or any state, province, commonwealth, nation, territory, possession, county, parish, town, township, village or municipality, whether now or hereafter constituted and/or existing. "12% Junior Exchange Debenture Indenture" shall mean that certain indenture dated as of the date of issuance of the 12% Junior Exchange Debentures, by and between the Borrower and the United States Trust Company of Texas, N.A., as trustee which shall be in form and substance satisfactory to the Managing Agent. "12% Junior Exchange Debentures" shall mean the Borrower's Subordinated Notes due 2009 issued pursuant to the 12% Junior Exchange Debenture Indenture. "12-1/4% Junior Exchange Debenture Indenture" shall mean that certain indenture dated as of the date of issuance of the 12-1/4% Junior Exchange Debentures, by and between the Borrower and United States Trust Company of Texas, as trustee. "12-1/4% Junior Exchange Debentures" shall mean the Borrower's Subordinated Notes due 2006 issued pursuant to the 12-1/4% Junior Exchange Debenture Indenture. "UCC" means the Uniform Commercial Code as from time to time in effect in the relevant jurisdiction. "U.S. Legal Tender" means such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts. "Voting Stock" means, with respect to any Person, securities of any class or classes of Capital Stock in such Person entitling the holders thereof (whether at all times or only 32 -27- so long as no senior class of stock has voting power by reason of any contingency) to vote in the election of members of the board of directors or other governing body of such Person. "Weighted Average Life to Maturity" means, when applied to any Indebtedness at any date, the number of years obtained by dividing (a) the then outstanding aggregate principal amount of such Indebtedness into (b) the total of the product obtained by multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal, including payment at final maturity, in respect thereof, by (ii) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment. "Wholly Owned Subsidiary" means, with respect to any Person, any corporation, association or other business entity of which 100% of the total voting power of shares of stock or other equity interest entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Wholly Owned Subsidiaries of that Person or a combination thereof. 1.2. Accounting Terms For the purposes of this Agreement, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with GAAP. 1.3. Other Definitional Provisions; Anniversaries Any of the terms defined in Section 1.1 may, unless the context otherwise requires, be used in the singular or the plural depending on the reference. SECTION 2 AMOUNT AND TERMS OF BRIDGE LOAN COMMITMENT AND BRIDGE LOAN; NOTES 2.1. Bridge Loan and Notes A. Bridge Loan Commitment; Ranking. Subject to the terms and conditions of this Agreement and in reliance upon the representations and warranties of the Company herein set forth, the Lenders severally and not jointly hereby agree to lend to the Company on the Closing Date the aggregate amount of $170 million (the "Bridge Loan"). Each Lender's commitment to make available its pro rata share of the Bridge Loan pursuant to this Section 2.1A in the amount set forth opposite the signature hereto is herein called the "Bridge Loan Commitment." The Lenders' collective commitments to make available the 33 -28- Bridge Loan to the Company pursuant to this Section 2.1A are herein called the "Total Bridge Loan Commitment." The Bridge Loan will be a senior unsecured obligation of the Company and will rank (i) pari passu with all other unsubordinated indebtedness of the Company and (ii) senior to any subordinated indebtedness of the Company. B. Notice of Borrowing. When the Company desires to borrow under this Section 2.1, it shall deliver to the Agent a Notice of Borrowing no later than 11:00 A.M. (New York time), at least one Business Day in advance of the Closing Date or such later date as shall be agreed to by the Agent. The Notice of Borrowing shall specify the applicable date of borrowing (which shall be a Business Day). Upon receipt of such Notice of Borrowing, the Agent shall promptly notify the Lenders of the matters covered by the Notice of Borrowing. C. Disbursement of Funds. (a) No later than 12:00 Noon (New York time) on the Closing Date, each Lender will make available its pro rata share (based on each Lender's Bridge Loan Commitment then in effect) of the Bridge Loan in the manner provided below. All amounts shall be made available in U.S. Legal Tender and immediately available funds at the Payment Office. (b)Nothing herein shall be deemed to relieve any Lender from its obligation to fulfill its Bridge Loan Commitment hereunder or to prejudice any rights that the Company may have against any Lender as a result of any default by such Lender hereunder. D. Notes. The Company shall execute and deliver to each of the Lenders on the Closing Date a note (collectively, the "Notes") dated the Closing Date substantially in the form of Exhibit I annexed hereto to evidence each Lender's pro rata obligation under the Bridge Loan and with appropriate insertions. E. Maturity of Bridge Loan. Subject to the provisions of Section 2.4, the Bridge Loan shall mature and the Company shall pay in full the outstanding principal amount thereof and accrued interest thereon on the earlier of (i) the two-year anniversary of the Closing Date (the "Maturity Date") and (ii) the consummation of the Evergreen Merger. F. Pro Rata Borrowings. The Bridge Loan made under this Agreement shall be made by the Lenders pro rata on the basis of their respective Bridge Loan Commitments. It is understood that no Lender shall be responsible for any default by any other Lender of its obligation to make its portion of the Bridge Loan hereunder and that each Lender shall be obligated to make its portion of the Bridge Loan hereunder, regardless of the failure of any other Lender to fulfill its commitments hereunder. 34 -29- 2.2. Interest on the Bridge Loan A. Rate of Interest. The Bridge Loan shall bear interest on the unpaid principal amount thereof from the date made through maturity (whether by prepayment, acceleration or otherwise) at the rate of three-month LIBOR, reset monthly, plus 3.25% per annum, which spread over applicable LIBOR shall increase to 6.00% on the six-month anniversary of the Closing Date and increasing thereafter by .50% per annum for each period of three months (or portion thereof) that the Bridge Loan remains outstanding; provided, however, that in no event shall the interest rate exceed the Maximum Cash Interest Rate. B. Interest Payments. Interest shall be payable at maturity or redemption of the Bridge Loan; provided that in the case of a redemption of less than all of the Bridge Loan the outstanding interest shall be payable only as to the portion of the Bridge Loan so redeemed. C. Post-Maturity Interest. Any principal payments on the Bridge Loan not paid when due and, to the extent permitted by applicable law, any overdue interest on the Bridge Loan, in each case whether at stated maturity, by notice of prepayment, by acceleration or otherwise, shall thereafter bear interest payable upon demand at a rate that is 2.00% per annum in excess of the rate of interest otherwise payable under this Agreement for the Bridge Loan. 2.3. Fees The Company agrees to pay to the Agent on behalf of the Lenders all fees and other obligations in accordance with, and at the times specified by, the Bridge Commitment Letter, including, without limitation, (i) all fees payable on the Closing Date, (ii) on the six month anniversary of the Closing Date, 1.5% of the total amount of the Bridge Loan outstanding and (iii) on each of the one year, eighteen month and two year anniversary of the Closing Date, an amount of Common Stock of the Company equal to 100,000 shares of Class A Common Stock multiplied by a fraction, the numerator of which is the principal amount of the Bridge Loan then outstanding and the denominator of which is $170,000,000. 2.4. Prepayments and Payments A. Prepayments (i) Voluntary Prepayments. The Company may, upon not less than three Business Days' prior written notice (or telephonic notice confirmed in writing) to the Agent at any time and from time to time, prepay the Bridge Loan made to the 35 -30- Company in whole or in part at 100% of the principal amount thereof, plus accrued interest thereon. Notice of prepayment having been given as aforesaid, the principal amount of the Bridge Loan to be prepaid shall become due and payable on the prepayment date. Amounts of the Bridge Loan so prepaid may not be reborrowed. (ii) Mandatory Prepayments (a) Prepayments from Sales of Subordinated Indebtedness and Equity Securities. Net proceeds of private or public sales of Subordinated Indebtedness or equity securities by the Company or any of its Subsidiaries shall be used to prepay the Bridge Loan, plus accrued interest and any other amount payable thereunder, to the full extent of the net proceeds so received; provided that no default or event of default under the Bank Financing Documents then exists or would result from such prepayment. (b) Prepayments Upon the Occurrence of Asset Sales. Upon the closing of any Asset Sale (other than sales of inventory in the ordinary course of business) of the Company or Chancellor, an amount in cash equal to the Net Cash Proceeds so received from any such Asset Sale shall be used to prepay the Bridge Loan, plus accrued interest thereon and any other amount payable thereunder; provided that no default or event of default under the Bank Financing Documents then exists or would result from such prepayment. (c) Notice. The Company shall notify the Agent of any prepayment to be made pursuant to this Section 2.4A(ii) at least one Business Day prior to such prepayment date. (iii) The Company's Mandatory Prepayment Obligations; Application of Prepayments. All prepayments shall include payment of accrued interest on the principal amount so prepaid and shall be applied to payment of interest before application to principal. (iv) Mandatory Offer to Purchase the Notes (a) Upon the occurrence of a Change of Control (the date of such occurrence, the "Change of Control Date"), the Lenders shall have the right, subject to the prior payment of the amounts owing under the Bank Financing or the waiver of the lenders thereunder to such prior payment and the payment of any fees owing hereunder to the Lenders, to require the repurchase of the Notes pursuant to an 36 -31- offer to purchase (the "Change of Control Offer") at a purchase price equal to the aggregate principal amount thereof plus accrued interest to the date of repurchase. (b) The notice to the Agent shall contain all instructions and materials necessary to enable the Lenders to tender the Notes. (c) Within 10 days following any Change of Control the Company shall mail a notice to the Agent stating: (1) that the Change of Control Offer is being made pursuant to this Section 2.4A(iv) and that all Notes validly tendered will be accepted for payment; (2) the purchase price and the purchase date, which shall be no earlier than 30 days nor later than 40 days from the date such notice is mailed (the "Offer Payment Date"); (3) that any Notes not tendered will continue to accrue interest; (4) that any Note accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Offer Payment Date unless the Company shall default in the payment of the repurchase price of the Note; (5) that if any Lender elects to have its Note purchased pursuant to the Change of Control Offer it will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Note completed, to the Company prior to 5:00 p.m. New York time on the Offer Payment Date; (6) that the Lenders will be entitled to withdraw their election if the Company receives, not later than 5:00 p.m. New York time on the Business Day preceding the Offer Payment Date, a telegram, telex, facsimile transmission or letter setting forth the principal amount of the Notes the Lenders delivered for purchase, and a statement that the Lenders are withdrawing their election to have the Notes purchased; and (7) that if the Notes are purchased only in part, a new Note of the same type will be issued in principal amount equal to the unpurchased portion of the Notes surrendered. (d) On or before the Offer Payment Date, the Company shall (i) accept for payment the Notes or portions thereof that are to be purchased in accordance with the above, and (ii) deposit at the Payment Office U.S. Legal Tender sufficient to pay the purchase price of Notes to be purchased. The Agent shall promptly mail to the Lenders 37 -32- whose Notes are so accepted payment in an amount equal to the purchase price. (e) The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an offer hereunder. To the extent the provisions of any securities laws or regulations conflict with the provisions under this Section, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this Section by virtue thereof. B. Manner and Time of Payment. All payments of principal and interest hereunder and under the Notes by the Company shall be made without defense, set-off or counterclaim and in same-day funds and delivered to the Agent, unless otherwise specified, not later than 12:00 Noon (New York time) on the date due at the Payment Office for the account of the Lenders; funds received by the Agent after that time shall be deemed to have been paid by the Company on the next succeeding Business Day. The Company hereby authorizes the Agent to charge its account with the Agent in order to cause timely payment to be made of all principal, interest and fees due hereunder (subject to sufficient funds being available in its account for that purpose). C. Payments on Non-Business Days. Whenever any payment to be made hereunder or under the Notes shall be stated to be due on a day that is not a Business Day, the payment shall be made on the next succeeding Business Day and such extension of time shall be included in the computation of the payment of interest hereunder or under the Notes or of the commitment and other fees hereunder, as the case may be. D. Notation of Payment. Each Lender agrees that before disposing of any Note held by it, or any part thereof (other than by granting participations therein), the Lender will make a notation thereon of all principal payments previously made thereon and of the date to which interest thereon has been paid and will notify the Company of the name and address of the transferee of that Note; provided that the failure to make (or any error in the making of) such a notation or to notify the Company of the name and address of such transferee shall not limit or otherwise affect the obligation of the Company hereunder or under such Notes with respect to the Bridge Loan and payments of principal or interest on any such Note. 38 -33- 2.5. Use of Proceeds A. Bridge Loan. The proceeds of the Bridge Loan shall be applied by the Company to finance the Acquisition, to effect the Bank Financing by repaying a portion of the Existing Credit Agreement indebtedness (as defined in the Bank Financing Documents) and to pay related fees and expenses (including the Transaction Costs). B. Margin Regulations. No portion of the proceeds of the borrowing under this Agreement shall be used by the Company in any manner that might cause the borrowing or the application of such proceeds to violate the applicable requirements of Regulation G, Regulation U, Regulation T or Regulation X of the Board of Governors of the Federal Reserve System or any other regulation of the Board of Governors or to violate the Exchange Act, in each case as in effect on the Closing Date and the date of such use of proceeds. SECTION 3 CONDITIONS 3.1. Conditions to Loan The obligation of the Lenders to make the Bridge Loan is subject to prior or concurrent satisfaction of each of the following conditions: A. On or before the Closing Date, all corporate and other proceedings taken or to be taken in connection with the transactions contemplated hereby and all documents incidental thereto not previously found acceptable by the Lenders shall be reasonably satisfactory in form and substance to the Lenders, and the Agent shall have received the following items, each of which shall be in form and substance reasonably satisfactory to the Agent and, unless otherwise noted, dated the Closing Date: 1. a certificate, dated the Closing date, signed by an authorized Officer of each of the Company and Chancellor, and attested to by the Secretary or Assistant Secretary of each of the Company and Chancellor, in the form of Exhibit VII, together with copies of each of the Company's and Chancellor's charter and together with a certificate of status, compliance, good standing or like certificate with respect to each of the Company and Chancellor issued by the appropriate government officials of the jurisdiction of its incorporation and of each jurisdiction in which it owns any material assets or carries on any material business, each to be dated a recent date prior to the Closing Date; 2. a copy of the Company's bylaws, certified as of the Closing Date by one of its Officers; 39 -34- 3. resolutions of the Company's Board of Directors approving and authorizing the execution, delivery and performance of this Agreement, the Notes and any other documents, instruments and certificates required to be executed by the Company or any Subsidiary of the Company, where applicable, in connection herewith and therewith and approving and authorizing the execution, delivery and payment of the Notes and the consummation of the Transactions, each certified as of the Closing Date by one of its Officers as being in full force and effect without modification or amendment; 4. signature and incumbency certificates of the Company's Officers executing this Agreement and the Notes; 5. executed copies of this Agreement and the Notes substantially in the form of Exhibit I executed in accordance with Section 2.1D drawn to the order of the Lenders and with appropriate insertions; 6. an originally executed Notice of Borrowing substantially in the form of Exhibit III, signed by an Officer on behalf of the Company in writing delivered to the Agent; 7. originally executed copies of one or more favorable written opinions of (I) Weil, Gotshal & Manges LLP, counsel for the Company, substantially in the form of Exhibit IV and addressed to the Lenders and (II) Cahill Gordon & Reindel, counsel for the Lenders, substantially in the form of Exhibit V and addressed to the Lenders; 8. true and correct copies of each of the Acquisition Agreement and the Merger Agreement, which shall not have been materially amended without the Agent's consent in any respect adverse to the interests of the Agent and the Lenders (which consent shall not be unreasonably withheld or delayed). All conditions to the Acquisition contained in the Acquisition Agreement shall have been performed or complied with substantially on the terms set forth therein and not waived without the Agent's consent, which consent shall not be unreasonably withheld or delayed. Simultaneously with the making of the Bridge Loan, the Acquisition shall have been consummated; and 9. a copy of all closing documents relating to the Acquisition and all such counterpart originals or certified copies of such documents, instruments, certificates and opinions as the Agent may reasonably request. B. The Lenders shall have received reports and other information in form, scope and substance reasonably satisfactory to 40 -35- the Lenders concerning environmental liabilities of Chancellor and the Subsidiaries of Chancellor. C. On or before the Closing Date, all authorizations, consents and approvals (including, without limitation, under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and preliminary approval from the FCC of the transfer or assignment of licenses as contemplated by the Acquisition) necessary in connection with the Transactions shall have been obtained and remain in full force and effect and all applicable waiting periods under Law applicable to the Acquisition shall have expired without any action being taken by any competent authority (including, without limitation, any Tribunal) that restrains, prevents or imposes materially adverse conditions upon the completion of the Acquisition or the financing thereof and evidence of the receipt of such authorizations, consents and approvals satisfactory to the Lenders shall have been delivered to the Agent. Additionally, there shall not exist any judgment, order, injunction or other restraint issued or filed or a hearing seeking injunctive relief or other restraint or objection pending or notified prohibiting or imposing materially adverse conditions upon the consummation of the Acquisition or the transactions contemplated by this Agreement. D. On or before the Closing Date, the Company shall have paid to the Agent the fees payable on the Closing Date pursuant to Section 2.3. E. On or before the Closing Date, the Company shall have performed in all material respects all agreements that this Agreement provides shall be performed on or before the Closing Date except as otherwise disclosed to and agreed to in writing by the Agent. F. The Company and the Lenders shall have entered into the Loan Documents relating to the Bridge Loan and the transactions contemplated thereby, on terms and in form and substance reasonably satisfactory to the Lenders and the Company. G. The Bank Financing Documents shall be in full force and effect and the parties thereto shall be in compliance with all material agreements thereunder. The Bank Financing Documents shall provide for borrowings thereunder in amounts and upon terms reasonably satisfactory to the Lenders. The Bank Financing Documents shall include provisions permitting the repayment of the Bridge Loan (including accrued interest thereon and any other amount payable thereunder) in accordance with the terms of the Bank Financing Documents, including the making of any restricted payment necessary to enable such repayment (the ability to make any such restricted payment hereinafter referred to as "Restricted Payment Capacity"). No default or event of default shall have occurred under the Bank Financing 41 -36- Documents and all conditions to borrowings thereunder shall have been satisfied, in the reasonable judgment of the Lenders, without waiver. H. The Evergreen-Viacom Acquisition and the related financing shall have been consummated in accordance with the terms of the agreements evidencing the Evergreen-Viacom Acquisition in the form delivered to the Lenders prior to the date hereof or otherwise reasonably satisfactory to the Lenders (the "Evergreen-Viacom Acquisition Agreements") and all applicable laws relating thereto. All material conditions in the Evergreen-Viacom Acquisition Agreements shall have been satisfied and not waived or modified except with the written consent of the Lenders (which shall not be unreasonably withheld or delayed), and all material covenants in the Evergreen-Viacom Acquisition Agreements shall have been satisfied (without waiver or modification) in all material respects and all representation and warranties contained therein shall be true and correct in all material respects (without waiver or modifications). I. Simultaneously with the making of the Bridge Loan by the Lenders, the Company shall have delivered to the Lenders an Officers' Certificate in form and substance satisfactory to the Agent to the effect that (i) on or prior to the Closing Date, the Company has performed and complied with in all material respects all covenants and conditions to be performed and observed by the Company on or prior to the Closing Date and (ii) all conditions to the consummation of the Acquisition in the Acquisition Agreement have been satisfied substantially on the terms set forth therein and have not been waived or amended without the Agent's prior written consent. J. Neither the Company nor Chancellor shall have sustained any loss or interference with respect to its businesses or properties from fire, flood, hurricane, accident or other calamity, whether or not covered by insurance, or from any labor dispute or any legal or governmental proceeding, which loss or interference, in the reasonable judgment of the Agent, has had or could reasonably be expected to have a Material Adverse Effect; there shall not have been, in the reasonable judgment of the Agent, any Material Adverse Change. K. No event shall have occurred and be continuing or would result from the consummation of the borrowing contemplated by the Notice of Borrowing that would constitute an Event of Default or Potential Event of Default. L. No order, judgment or decree of any court, arbitrator or governmental authority shall purport to enjoin or restrain the Lenders from making the Bridge Loan. 42 -37- M. There shall not be pending or, to the knowledge of the Company, threatened any action, suit, proceeding, governmental investigation or arbitration against or affecting the Company or Chancellor or any property or asset of Chancellor or any of its Subsidiaries that has not been disclosed by the Company in writing to the Agent (and the Agent shall have received on the Closing Date an Officer's Certificate dated the Closing Date attesting to the same) and that could reasonably be expected to have a Material Adverse Effect and there shall have occurred no development not so disclosed in any such action, suit, proceeding, governmental investigation or arbitration so disclosed, which, in each case, singly or in the aggregate, in the opinion of the Agent, could reasonably be expected to have a Material Adverse Effect or to impair the ability or obligation of the Company, to perform, or of the Lenders to enforce, the Transactions or the making of the Bridge Loan. No injunction or other restraining order shall have been issued and no hearing to cause an injunction or other restraining order to be issued shall be pending or noticed with respect to any action, suit or proceeding seeking to restrain, enjoin, delay, prohibit or otherwise prevent the consummation of, or to recover any damages or obtain relief as a result of, the Transactions. There shall not be threatened, instituted or pending any action, proceeding or application before or by any Tribunal, or any other Person, domestic or foreign (i) challenging the Transactions or seeking to restrain, delay or prohibit the consummation thereof; (ii) seeking to prohibit or impose material limitations on the Company's ownership or operation of all or any portion of the Company's business or assets (including the business or assets of any Subsidiary thereof) or to compel the Company to dispose of or hold separate all or any portion of the Company's business or assets (including the business or assets of any Subsidiary thereof) as a result of the Acquisition; (iii) that, in any event, might adversely affect the Bridge Loan; or (iv) seeking to impose any materially adverse conditions upon the Transactions. N. The making of the Bridge Loan in the manner contemplated in this Agreement shall not violate the applicable provisions of Regulation G, T, U or X of the Board of Governors of the Federal Reserve Board or any other regulation of the Board. O. There shall not have occurred (i) any general suspension of, or limitation on times or prices for, trading in securities on the New York Stock Exchange, the American Stock Exchange or Nasdaq National Market or minimum or maximum prices established on any such exchanges or market; (ii) a declaration of a banking moratorium or any suspension of payments in respect of the banks in the United States or New York; or (iii) either (A) an outbreak or escalation of hostilities between the United States and any foreign power, or (B) an outbreak or escalation of any other insurrection or armed conflict involving the United 43 -38- States or any other national or international calamity or emergency or (C) trading in securities generally on the New York or American Stock Exchange or the Nasdaq National Market shall not have been suspended and minimum or maximum prices shall not have been established on any such exchange or market. P. There shall not have been any disclosure of information relating to conditions or events not previously disclosed to the Lenders, or new information regarding previously disclosed matters, in the course of the Lenders' continuing legal, financial, tax, environmental, business and accounting due diligence review that the Lenders shall reasonably determine is material and adverse to the Company or Chancellor. Q. The Agent shall be satisfied, in its reasonable discretion, with its review of the accounting policies and procedures utilized by the Company and its Subsidiaries and to be utilized by the Company and its Subsidiaries after the Acquisition. R. The Agent shall have received and be satisfied, in its reasonable discretion, that audited, unaudited and pro forma financial statements previously delivered to the Agent and the Lenders and prepared in accordance with GAAP, consistently applied, of the Company and Chancellor and any Company acquired by either of them whose financial statements would be required to be filed with the Commission in a public offering are available as of the Closing Date. S. The Agent and its counsel shall be reasonably satisfied that the consummation of the Acquisition and the related financing, including the funding of the Bridge Loan, shall be in compliance with all applicable Laws. There shall not have been any statute, rule, regulation, injunction or order applicable to the Acquisition, or the financing thereof, promulgated, enacted, entered or enforced by any state or federal government or governmental or regulatory authority or agency or by any federal or state court, or by any Tribunal, nor shall there be pending any action or proceeding by or before any such authority, court or tribunal, involving an order that would materially and adversely affect the Acquisition or the financing thereof. T. Neither the Company nor any of its Material Subsidiaries shall be a debtor subject to a Bankruptcy Order; and a bankruptcy or other insolvency proceeding or an Event of Default or Potential Event of Default shall not have occurred under Section 7.6, 7.7 or 7.8. U. No Event of Default or Potential Event of Default (whether matured or not) shall have occurred under Section 7.1. 44 -39- V. Chancellor must have entered into binding and unconditional asset sale agreements (other than those conditioned upon the grant of license from the FCC) in form and substance reasonably satisfactory to the Lenders for aggregate consideration in cash of at least $37 million, and such asset sale agreements shall be in full force and effect. W. Neither the consummation of the Acquisition, the making of the Bridge Loan or the borrowings under the Bank Financing will cause or result in any breach or default (including any event that with notice or lapse of time or both would be a breach or a default) or trigger any repurchase requirements under any of the terms or provisions of any of the instruments governing the material existing indebtedness or preferred stock of the Company and its Subsidiaries. X. The Lenders shall have received an Officers' Certificate with respect to and be satisfied, in their reasonable judgment, as to the sufficiency of Restricted Payment Capacity under Chancellor's debt and preferred stock instruments to permit the Company to satisfy its payment obligations with respect to the Bridge Loan and the ability of Chancellor to utilize such Restricted Payment Capacity. Y. Upon the reasonable request of the Lenders, the Company shall have provided the Lenders the offering memorandum or similar document prepared in connection with the Bank Financing containing information typically found in an offering memorandum relating to the Company (which offering memorandum shall contain audited, unaudited and pro forma financial statements meeting the requirements of Regulation S-X under the Securities Act of 1933, as amended, for the periods required of a registrant on Form S-1) for use by the Agent in syndicating the Bridge Loan in accordance with the terms of this Agreement. SECTION 4 REPRESENTATIONS AND WARRANTIES In order to induce the Lenders to enter into this Agreement and to make the Bridge Loan, the Company represents and warrants to the Lenders that, at the time of execution hereof, the following statements are true, correct and complete and after consummation of the Transactions, the following statements are true, correct and complete in all material respects: 4.1. Organization and Good Standing; Capitalization (a) Each of the Company and Chancellor is a corporation duly organized and existing and in good standing under the laws of the State of Delaware. Each of the Company and Chancellor has the corporate power and authority to own and operate its properties and to carry on its business as now conducted 45 -40- and as proposed to be conducted and is duly qualified as a foreign corporation and in good standing in all jurisdictions in which it is doing business, except where failure to be so qualified or in good standing, singly or in the aggregate, has not had and will not have a Material Adverse Effect or a material adverse effect on the ability of the Company or Chancellor to consummate the Transactions and to execute, deliver and perform its respective obligations under the Loan Documents and each other document or instrument to be delivered in connection with the Transactions executed or to be executed by it. (b) All of the Subsidiaries of the Company as of the Closing Date are identified in Schedule B. The Capital Stock of each of the Subsidiaries of the Company identified in Schedule B is duly authorized, validly issued, fully paid and nonassessable and none of such capital stock constitutes Margin Stock. (c) On or about June 12, 1997, there were authorized, issued and outstanding (i) 40,000,000 shares of Class A Common Stock, $.01 par value per share ("Class A Common Stock"), of which 10,439,628 shares were issued and outstanding, (ii) 10,000,000 shares of Class B Common Stock ("Class B Common Stock"), $.01 par value per share, 8,547,910 shares of which were issued and outstanding, (iii) 10,000,000 shares of Class C Common Stock, $.01 par value per share ("Class C Common Stock"), none of which were outstanding and (iv) 10,000,000 shares of preferred stock, $.01 par value per share, 2,300,000 shares of which were designated 7% Convertible Preferred Stock, of which 2,000,000 shares were issued and outstanding. All such outstanding shares of the Company have been duly and validly issued, fully paid and nonassessable. No stockholder of the Company has any preemptive rights to subscribe for any additional equity securities of the Company. Any issuance and sale of Common Stock of the Company, upon such issuance and sale, will either (a) have been registered or qualified under applicable federal and state securities laws or (b) be exempt therefrom. 4.2. Authorization and Power Each of the Company and Chancellor has the corporate power and requisite authority, and, to the extent a party thereto, has taken all corporate action necessary, to consummate the Transactions and to execute, deliver and perform its obligations under the Loan Documents and each other document and instrument to be delivered in connection with the Transactions executed or to be executed by it and to issue the Notes. 46 -41- 4.3. No Conflicts or Consents (a) The execution and delivery of the Loan Documents, the Acquisition Agreement, the Bank Financing Documents and each other document to be executed and delivered in connection with the Transactions, the consummation of each of the transactions herein or therein contemplated, the compliance with each of the terms and provisions hereof or thereof, and the issuance, delivery and performance of the Notes do not and will not (i) except as disclosed to the Lenders violate any material provision of any law or any governmental rule or regulation applicable to the Company or Chancellor, the Certificate or Articles of Incorporation or bylaws of either of them or any order, judgment or decree of any court or other agency of government binding on any of them, (ii) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Contractual Obligation of the Company or Chancellor that could reasonably be expected to result in a Material Adverse Effect or have a material adverse effect on the ability of the Company or Chancellor to consummate the Transactions and to execute, deliver and perform their obligations under the Loan Documents and each other document and instrument to be delivered in connection with the Transactions executed or to be executed by it, (iii) result in or require the creation or imposition of any Lien upon any of the material properties or assets of any of the Company or Chancellor or (iv) require any approval of stockholders or any approval or consent of any Person under any Contractual Obligation of the Company or Chancellor except for such approvals or consents that will be obtained on or before the Closing Date or such approvals or consents the failure to obtain that could not reasonably be expected to singly or in the aggregate result in a Material Adverse Effect or have a material adverse effect on the ability of the Company or Chancellor to consummate the Transactions and to execute, deliver and perform its obligations under the Loan Documents and each other document and instrument to be delivered in connection with the Transactions executed or to be executed by it. (b) No consent, approval, authorization or order of any Tribunal or other Person is required in connection with the execution and delivery by the Company or Chancellor of the Loan Documents or any other document or instrument to be delivered in connection with the Transactions or the consummation of the transactions contemplated hereby or thereby, other than any such consent, approval, authorization or order that has been obtained and remains in full force and effect and other than preliminary FCC approval regarding any transfer or assignment of licenses contemplated by the Acquisition Agreement or that has been waived in writing by the Agent on behalf of Lenders or the failure of which to obtain would not, singly or in the aggregate, have a Material Adverse Effect or a material adverse 47 -42- effect on the ability of the Company or Chancellor to consummate the Transactions and to execute, deliver and perform its respective obligations under the Loan Documents and each other document or instrument to be delivered in connection with the Transactions executed or to be executed by it. 4.4. Enforceable Obligations Each of the Loan Documents, the Acquisition Agreement, the Bank Financing Documents, the Evergreen-Viacom Acquisition Agreements and each other document or instrument to be delivered in connection therewith has been duly authorized; each of the Loan Documents, the Acquisition Agreement, the Bank Financing Documents, the Evergreen-Viacom Acquisition Agreements and each other document or instrument to be delivered in connection therewith to be executed and delivered on or prior to the Closing Date has been duly executed and delivered by the Company and Chancellor (to the extent a party thereto); and each of the Loan Documents, the Acquisition Agreement, the Bank Financing Documents, the Evergreen-Viacom Acquisition Agreements and each other document or instrument to be delivered in connection therewith to be executed and delivered on or prior to the Closing Date is, and each of the Loan Documents to be executed and delivered after the Closing Date will be, upon such execution and delivery, the legal, valid and binding obligations of the Company and Chancellor (to the extent a party thereto), enforceable in accordance with their respective terms, except to the extent that the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization or similar laws affecting the enforcement of creditors' rights generally or by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). 4.5. Properties; Liens The Company has, and after consummation of the Acquisition will have, good, sufficient and legal title to all of its respective properties and assets, and all properties held under lease by it, are, and immediately after the consummation of the Acquisition will be, held under valid, subsisting and enforceable leases, and the Company is not in default under any lease, except in each case for such defects or defaults that, singly or in the aggregate, would not have a Material Adverse Effect. Except as permitted by this Agreement, all such properties and assets owned or leased are so owned or leased free and clear of Liens. 4.6. Financial Condition (a) The audited consolidated balance sheets of the Company and the Subsidiaries of the Company at December 31, 48 -43- 1996 and 1995 and the related consolidated statements of income, shareholders equity and cash flows of the Company and the Subsidiaries of the Company for the three-year period ended December 31, 1996, certified by the independent certified public accountants of the Company, copies of which have been delivered to the Agent, were prepared in accordance with GAAP, have been prepared from, and are consistent with, the books and records of the Company and fairly present in all material respects the consolidated financial position, as at the respective dates thereof, and the consolidated results of operations and cash flows of the Company and the Subsidiaries of the Company for the periods then ended. The Company did not have at December 31, 1996 any material contingent liabilities, liabilities for Taxes or long-term leases, unusual forward or long-term commitments or unrealized or unanticipated losses from any unfavorable commitments which are not reflected or reserved against in the foregoing statements or in the notes thereto. No events that have had or could reasonably be expected to have a Material Adverse Effect have occurred since December 31, 1996. (b) To the knowledge of the Company, the unaudited consolidated balance sheet of the Company and the Subsidiaries of the Company at March 31, 1997 and the related consolidated statements of income, retained earnings (deficit) and cash flows of the Company and the Subsidiaries of the Company for the period then ended, a copy of which has been delivered to the Agent, were prepared in accordance with GAAP consistently applied (except to the extent noted therein), have been prepared from, and are consistent with, the books and records of Chancellor and fairly present in all material respects the consolidated financial position of the Company and the Subsidiaries of the Company as of such date and the consolidated results of operations and cash flows of the Company and the Subsidiaries of the Company for the period covered thereby, in each case subject to normal year-end audit adjustments (including footnotes), consistent with past practices. The Company did not have at March 31, 1997 any material contingent liabilities, liabilities for Taxes or long-term leases, unusual forward or long-term commitment or unrealized or unanticipated losses from any unfavorable commitment that are not reflected or reserved against in the foregoing statements or in the notes thereto. (c) The pro forma balance sheet of the Company, a copy of which has heretofore been furnished to the Agent, fairly presents the estimated consolidated opening balance sheet of the Company assuming the Transactions had occurred as of January 1, 1997, and the financial condition of Chancellor on the Closing Date does not differ in any material respect from the information therein set forth. (d) Upon giving effect to the Transactions: 49 -44- (i) The fair saleable value of the assets of each of the Company and Chancellor, on a consolidated basis, 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 such Person as they mature. (ii) The assets of each of the Company and Chancellor, on a consolidated basis, do not constitute unreasonably small capital for any such Person to carry out its business as now conducted and as proposed to be conducted including the capital needs of any such Person, taking into account the particular capital requirements of the business conducted by such Person, and projected capital requirements and capital availability thereof. (iii) The Company on a consolidated basis does not intend to, and will not permit any of its Subsidiaries to, incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of debt of each of such Person). The cash flow of the Company and each of its Subsidiaries on a consolidated basis, after taking into account all anticipated uses of the cash of each such Person, will at all times be sufficient to pay all amounts on or in respect of debt of each such company when such amounts are required to be paid. (iv) The Company does not intend, and does not believe, that final judgments against any of the Company or its Subsidiaries in actions for money damages will be rendered at a time when, or in an amount such that, the Company and its Subsidiaries on a consolidated basis, will be unable to satisfy any such judgments promptly in accordance with their terms (taking into account the maximum reasonable amount of such judgments in any such actions and the earliest reasonable time at which such judgments might be rendered). The cash flow of each of the Company and Chancellor, on a consolidated basis, after taking into account all other anticipated uses of the cash of each such consolidated group (including the payments on or in respect of debt referred to in paragraph (iii) of this Section 4.6(d)), will at all times be sufficient to pay all such judgments promptly in accordance with their terms. 4.7. Full Disclosure The financial projections (including, without limitation, the pro forma financial statements included therewith) heretofore furnished to the Agent by the Company and attached hereto as Exhibit VI are complete, were prepared by or under the direction of an officer of the Company and were prepared in good faith on the basis of information and assumptions that the Company believed to be fair, complete and reasonable as of the date of such information, and which assumptions are believed to be fair, complete and reasonable as of the date hereof, but the Agent and the Lenders acknowledge that actual results may vary from the projections and such variations may be significant. All other factual information heretofore or contemporaneously furnished in writing by or on behalf of the Company and Chancellor to the Agent for purposes of or in connection with this Agreement (including, but not limited to, the Acquisition Agreement and the Bank Financing Documents and all 50 -45- exhibits and appendices thereto) does not contain any untrue statement by such party or, to its knowledge, any other party of a material fact or omit to state any material fact necessary to keep the statements made by such party or, to its knowledge, any other party contained herein or therein from being misleading. No fact is known, no condition exists nor has any event occurred that has not been disclosed herein or in any other document, certificate or statement furnished to the Agent or the Lenders for use in the transactions contemplated hereby that, singly or in the aggregate, could reasonably be expected to have a Material Adverse Effect. 4.8. No Default No event has occurred and is continuing that constitutes a Potential Event of Default or an Event of Default. 4.9. Compliance with Contracts, Etc. Neither the Company nor Chancellor is in violation of (A) its certificate of incorporation, by-laws or other organizational documents or (B) any applicable law, ordinance, administrative or governmental rule or regulation, except, with respect to this clause (B), for such violations that would not, singly or in the aggregate, have a Material Adverse Effect, or (C) any order, decree or judgment of any Tribunal having jurisdiction over any of them; no event of default or event that but for the giving of notice or the lapse of time, or both, would constitute an event of default on the part of either the Company or Chancellor exists under any material Contractual Obligation. 4.10. No Litigation There is no Litigation pending or, to the best knowledge of the Company, threatened, by, against or that may relate to or affect (a) the Transactions or (b) the Company, Chancellor or Subsidiaries of Chancellor that, singly or in the aggregate, could reasonably be expected to have a Material Adverse Effect. There are no outstanding injunctions or restraining orders prohibiting consummation of any of the transactions contemplated by the Loan Documents. Neither the Company nor Chancellor is in default with respect to any judgment, order, writ, injunction or decree of any court or governmental agency, and 51 -46- there are no unsatisfied judgments against any such Person or its business or activities. Neither the Company nor Chancellor has been advised that there is a reasonable likelihood of an adverse determination of any Litigation which adverse determination, should it occur, would have a Material Adverse Effect or a material adverse effect on the ability of the Company or Chancellor to consummate the Transactions and to execute, deliver and perform its respective obligations under the Loan Documents and each other document or instrument to be delivered in connection with the Transactions executed or to be executed by it. 4.11. Use of Proceeds; Margin Stock, Etc. The proceeds of the Bridge Loan will be used solely for the purposes specified herein. None of such proceeds will be used for the purpose of purchasing or carrying any Margin Stock within the meaning of the applicable provisions of Regulation G, T, U or X, or for the purpose of reducing or retiring any Indebtedness that was originally incurred to purchase or carry a Margin Stock or for any other purpose that might constitute this transaction a "purpose credit" within the meaning of the applicable provisions of Regulation G, T, U or X. The Company has not taken or will take any action that might cause any of the Loan Documents to violate the applicable provisions of Regulation G, T, U or X, or any other regulation of the Board of Governors of the Federal Reserve System. 4.12. Taxes All material tax returns, foreign and domestic, required to be filed by the Company or Chancellor in any jurisdiction have been filed, and all material Taxes for which they are directly or indirectly liable or to which any of their respective properties or assets are subject have been paid prior to the time that such Taxes could give rise to a Lien thereon, except for Contested Claims. There is no material proposed tax assessment against the Company or Chancellor, and, to the best knowledge of the Company, there is no basis for such assessment, except for Contested Claims. 4.13. ERISA A. The Company and Chancellor and each of their respective ERISA Affiliates are in material compliance with all applicable provisions and requirements of the Internal Revenue Code and ERISA and the regulations thereunder with respect to each Employee Benefit Plan and have timely performed all their material obligations under each Employee Benefit Plan, in each case, to the extent applicable. 52 -47- B. No ERISA Event has occurred or is reasonably expected to occur that individually or in the aggregate resulted in or might reasonably be expected to result in a Material Adverse Effect. C. In accordance with the most recent actuarial valuations, the Amount of Unfunded Benefit Liabilities individually or in the aggregate for all Pension Plans (excluding for purposes of such computation any Pension Plans that have a negative Amount of Unfunded Benefit Liabilities), could not be reasonably expected to have a Material Adverse Effect. D. Neither the Company nor Chancellor is a party to any Foreign Plans. 4.14. Compliance with Law Each of the Company and Chancellor is in compliance with all Laws, except where the failure to comply, singly or in the aggregate, would not have a Material Adverse Effect. 4.15. Government Regulation Neither the Company nor Chancellor is subject to regulation under the Public Utility Holding Company Act of 1935, the Federal Power Act, the Investment Company Act of 1940 (as any of the preceding acts have been amended) or other Law that regulates the Incurrence by the Company or Chancellor of Indebtedness, including, but not limited to, Laws relating to common contract carriers or the sale of electricity, gas, steam, water or other public utility services. 4.16. Capital Structure and Subsidiaries After giving effect to the Transactions, (i) the Company will have no interest in any Person other than Chancellor and Chancellor's direct and indirect subsidiaries and the Company will own, free and clear of all Liens, claims or restrictions on voting or transfer, all of the shares of outstanding Capital Stock of Chancellor and each of the entities set forth on such Schedule B as of the Closing Date owned by it, except as specified on Schedule B and (ii) the Company will have no interest in any other Person. All of the issued and outstanding shares of Capital Stock of the Company and each of its Subsidiaries is, and at and as of the date of consummation of the Transactions will be, duly authorized, validly issued, fully paid and nonassessable. 4.17. Intellectual Property A. Schedule C sets forth a complete and correct list, as of the Closing Date, of: (i) all patented or registered Intellec- 53 -48- tual Property and pending patent applications or applications for registration of Intellectual Property owned or filed by or on behalf of the Company and Chancellor; (ii) all trade names and unregistered trademarks or service marks owned by or used by the Company and Chancellor; and (iii) all licenses of Intellectual Property to which the Company and Chancellor or any of them is a party, either as licensee or licensor. Except as set forth on Schedule C as of the Closing Date, each of the Company and Chancellor or any of them own or are licensed to use all Intellectual Property necessary to permit the operation of their businesses as currently conducted. B. Except as disclosed on Schedule C as of the Closing Date, no material claim has been asserted by any Person with respect to the use of any such Intellectual Property, or challenging or questioning the validity or effectiveness of any such Intellectual Property. Except as disclosed on Schedule C, the use of such Intellectual Property by the Company and Chancellor does not infringe on the rights of any Person, subject to such claims and infringements as do not, in the aggregate, give rise to any liabilities on the part of the Company or Chancellor that would result in a Material Adverse Effect. The consummation of the Transactions will not in any material manner or to any material extent impair the ownership of (or the license to use, as the case may be) any of such Intellectual Property by the Company or Chancellor. 4.18. Environmental Matters Except as set forth on Schedule D: A. Each of the Company and Chancellor has complied in all material respects with all applicable Environmental Law and the requirements of any permits issued under such Environmental Law. There are no pending, past or threatened Environmental Claims against the Company or Chancellor or any Real Property currently or formerly owned, leased or operated by the Company or Chancellor. There are no facts, circumstances, conditions or occurrences concerning the operations of the Company or Chancellor (including, without limitation, disposal or transportation of Hazardous Substances) or concerning any Real Property owned, leased or operated by the Company or Chancellor, or on any property adjoining or in the vicinity of any such Real Property, that could reasonably be expected (a) to form the basis of an Environmental Claim against the Company or Chancellor or any such Real Property, or (b) to cause any such Real Property to be subject to any restrictions on the ownership, occupancy, use or transferability of such Real Property by the Company or Chancellor under any applicable Environmental Law. B. Hazardous Material has not at any time been generated, used, treated or stored on, or transported to or from, any Real 54 -49- Property owned, leased or operated by the Company or Chancellor where such generation, use, treatment or storage has violated or could reasonably be expected to violate any Environmental Law or could reasonably be expected to result in an Environmental Claim. Hazardous Material has not at any time been Released on or from any Real Property owned, leased or operated by the Company or Chancellor or, to the knowledge of the Company, in the vicinity of such Real Property, where such Release has violated or could reasonably be expected to violate any applicable Environmental Law or could reasonably be expected to result in an Environmental Claim against the Company or Chancellor. Except as disclosed on Schedule D.1., no underground storage tanks or related piping is located on any Real Property owned, leased or operated by the Company or Chancellor. C. Notwithstanding anything to the contrary in this Section 4.18, the representations and warranties made in this Section 4.18 shall only be untrue if the aggregate effect of all liabilities, failures, violations and noncompliances of the types described above could reasonably be expected to have a material adverse affect on the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Company or of the Company and its Subsidiaries taken as a whole. 4.19. Survival of Representations and Warranties Subject to Section 9.10B, all representations and warranties in the Loan Documents shall continue until one year after repayment of the Notes and the Obligations, and any investigation at any time made by or on behalf of the Lenders shall not diminish the Lenders' right to rely thereon. 4.20. Permits Except as disclosed on Schedule E as of the Closing Date or otherwise disclosed to the Lenders, the Company and Chancellor have, and immediately after the consummation of the Transactions will have such certificates, permits, licenses, franchises, consents, approvals, authorizations and clearances that are material to the condition (financial or otherwise), business or operations of the Company or Chancellor, taken as a whole ("Permits"), and are (and will be immediately after the consummation of the Transactions) in compliance in all material respects with all applicable Laws of all Tribunals as are necessary to own, lease or operate their respective properties and to conduct their businesses in the manner as presently conducted and to be conducted immediately after the consummation of the Transactions, and all such Permits are valid and in full force and effect and will be valid and in full force and effect 55 -50- immediately upon consummation of the Transactions. Each of the Company and Chancellor is, and immediately after the consummation of the Transactions will be, in compliance in all material respects with its respective obligations under such Permits and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination of such Permits, except for any such revocation or termination as would not, singly or in the aggregate, have a Material Adverse Effect. 4.21. Insurance Each of the Company and Chancellor carries or is entitled to the benefits of insurance (including self-insurance) in such amounts and covering such risks as is generally maintained by companies of established repute engaged in the same or similar businesses, and all such insurance is (and will be immediately after the consummation of the Transactions) in full force and effect. 4.22. Labor Matters No labor disturbance by the employees of either the Company or Chancellor exists or, to the best knowledge of the Company, is threatened, and the Company is not aware of any existing or imminent labor disturbance by the employees of any of the Company's or Chancellor's principal suppliers, manufacturers or customers that could, singly or in the aggregate, have a Material Adverse Effect. 4.23. Broker's or Finder's Fees Other than those payable as Transaction Costs, no broker's or finder's fees or commissions will be payable by the Company with respect to any transaction contemplated hereby and no similar fees or commissions will be payable by the Company for any other services rendered to the Company in connection with the transactions contemplated hereby and thereby, other than those payable to the Lenders and Agent. The Company represents, warrants, covenants and agrees that it will indemnify the Lenders and the Agent against, and hold each of them completely harmless from and against, any and all claims, demands or liabilities for broker's or finder's fees or similar fees or commissions asserted to have been incurred in connection with any of the transactions contemplated hereby. SECTION 5 AFFIRMATIVE COVENANTS The Company covenants and agrees that, until the Bridge Loan and the Notes and all other amounts due under this Agreement have been paid in full it shall perform all covenants in this Section 5 required to be performed by it: 56 -51- 5.1. Financial Statements and Other Reports The Company will maintain, and will cause each of its Subsidiaries to maintain, a system of accounting established and administered in accordance with sound business practices to permit preparation of consolidated financial statements in conformity with GAAP. The Company will deliver to the Lenders and the Agent: (i) within 30 days after the end of each fiscal month (other than the fiscal months ending March, June, September and December) of the Company, (i) the combined and combining balance sheets of the Company and its Subsidiaries for each fiscal month, each as of the end of such month and the related combined and combining statements of income and statements of cash flows for such month and for the last elapsed portion of the fiscal year ended with the last day of such month, in each case setting forth in the statements of income only, the comparative figures for the corresponding month in the prior fiscal year and the budgeted figures for such month as set forth in the respective budgets delivered pursuant to Section 5.1(v) and (ii) the balance sheets of each of the Stations on an individual basis as of the end of such month and the related statements of income and statements of cash flows for such month and for the elapsed portion of the fiscal year ended with the last day of such month, in each case setting forth in the statements of income only, the comparative figures for the corresponding month in the prior fiscal year and the budgeted figures for such month as set forth in the respective budgets delivered pursuant to Section 5.1(v); (ii) as soon as available and in any event within 45 days after the close of each of the first three quarterly accounting periods in each fiscal year of the Company; (i) the combined and combining balance sheets of the Company and its Subsidiaries for each fiscal quarter, each as of the end of such quarter and the related combined and combining statements of income and statements of cash flows for such quarter and for the last elapsed portion of the fiscal year ended with the last day of such quarter and setting forth in the statements of income only, the comparative figures for the corresponding quarter in the prior fiscal year and the budgeted figures for such quarter as set forth in the respective budgets delivered pursuant to Section 5.1(v), and (ii) the balance sheets of each of the Stations as of the end of such quarter and the related statements of income and statements of cash flows for such quarter and for the elapsed portion of the fiscal year ended with the last day of such quarter, in each case setting forth in the statements of income only, the comparative figures for the corresponding quarter in the prior fiscal year and the budgeted figures for such quarter as set forth in the respective budgets delivered pursuant to Section 5.1(v); 57 -52- (iii) within 95 days after the close of each fiscal year of the Company, (i) the consolidated and consolidating balance sheets of the Company and its Subsidiaries for each fiscal year, each as at the end of such fiscal year and the related statements of income and retained earnings and of cash flows for such fiscal year and, setting forth comparative figures for the preceding fiscal year and certified, in the case of such consolidated statements, by Coopers & Lybrand L.L.P. or such other independent certified public accountants of recognized national standing reasonably acceptable to the Agent, (ii) the balance sheets of each of the Stations at the end of such fiscal year and the related statement of income and retained earnings and statement of cash flows for such fiscal year, in each case setting forth comparative figures for the preceding fiscal year for income statements only and (iii) management's discussions and analysis of the important operational and financial developments during such fiscal year in respect of the Company and its Subsidiaries; (iv) promptly after the receipt thereof by the Company or any of its Subsidiaries, a copy of any final "management letter" received by the Company or such Subsidiary from its certified public accountants and a copy of management's responses thereto; (v) no later than 30 days following the commencement of the first day of each fiscal year of the Company, budgeted statements of income in form satisfactory to the Agent prepared by the Company for (x) each of the twelve months of such fiscal year prepared in detail, and (y) each of the four years immediately following such fiscal year prepared in summary form, in each case, of each of the Company and its Subsidiaries and each of the Stations on an individual basis accompanied by the statement of the President or Chief Financial Officer or the Senior Vice President of Finance or any other person designated in writing by the foregoing of the Borrower to the effect that, to the best of his knowledge, the budget is a reasonable estimate for the period covered thereby; (vi) together with each delivery of financial statements pursuant to Section 5.1(ii) above, (a) an Officers' Certificate of the Company stating that the signers have reviewed the terms of this Agreement and the Notes and have made, or caused to be made under their supervision, a review in reasonable detail of the transactions and condition of the Company and its Subsidiaries during the accounting period covered by such financial statements and that such review has not disclosed the existence during or at the end of such accounting period, and that the signers do not have knowledge of the existence as of the date of the Officers' Certificate, of any condition or event that constitutes an Event of Default or Potential Event of Default, or, if any such condition or event ex- 58 -53- isted or exists, specifying the nature and period of existence thereof and what action the Company has taken, is taking and proposes to take with respect thereto; and (b) a Compliance Certificate demonstrating in reasonable detail compliance (as determined in accordance with GAAP) during and at the end of such accounting periods with the restrictions contained in Sections 6.1, 6.2, 6.3, 6.4, 6.5, 6.8 and 6.11; (vii) promptly, and in any event within three Business Days after an Officer of the Company obtains knowledge thereof, notice of (1) the occurrence of any event which constitutes a Default or Event of Default and (ii) any litigation or governmental investigation or proceeding pending (x) against the Company or any of its Subsidiaries which could reasonably be expected to have a Material Adverse Effect, (y) with respect to any material Indebtedness of the Company and its Subsidiaries taken as a whole or (z) with respect to any other document which could reasonably be expected to have a Material Adverse Effect; (viii) promptly, copies of all (x) financial information, proxy materials and other information and reports, if any, which the Company or any of its Subsidiaries shall file with the Commission or any successor thereto, or deliver to holders of its Indebtedness pursuant to the terms of the documentation governing such Indebtedness (or any trustee, agent or other representative therefor) and (y) material filings or communications with the FCC or under, or as required by, the Communications Act; (ix) from time to time, such other information or documents (financial or otherwise) with respect to the Company or its Subsidiaries as any Lender may reasonably request in writing; (x) promptly upon any executive officer of the Company obtaining knowledge (a) of any condition or event that constitutes an Event of Default or Potential Event of Default, or becoming aware that the Lenders or Agent has given any notice or taken any other action with respect to a claimed Event of Default or Potential Event of Default under this Agreement, (b) that any Person has given any notice to the Company or any Subsidiary of the Company or taken any other action with respect to a claimed default or event or condition that might result in an Event of Default referred to in Section 7.2, (c) of any condition or event that would be required to be disclosed in a current report filed with the Commission on Form 8-K whether or not the Company is required to file such reports under the Exchange Act or (d) of the occurrence of any event or change that has caused or evidences, either in any case or in the aggregate, a Material Adverse Effect, an Officers' Certificate specifying the nature and period of existence of any such 59 -54- condition or event, or specifying the notice given or action taken by such holder or Person and the nature of such claimed default, Event of Default, Potential Event of Default, event or condition, and what action the Company has taken, is taking and proposes to take with respect thereto; (xi) promptly upon any executive officer of the Company obtaining knowledge of (X) the institution of, or non-frivolous threat of, any action, suit, proceeding (whether administrative, judicial or otherwise), governmental investigation or arbitration against or affecting the Company or any of its Subsidiaries or any property of the Company or any of its Subsidiaries (collectively, "Proceedings") not previously disclosed in writing by the Company to the Lenders or (Y) any material development in any Proceeding that, in any case: (1) if adversely determined, has a reasonable possibility of giving rise to a Material Adverse Effect; or (2) seeks to enjoin or otherwise prevent the consummation of, or to recover any damages or obtain relief as a result of, the Transactions; written notice thereof together with such other information as may be reasonably available to the Company or any of its Subsidiaries to enable the Lenders and its counsel to evaluate such matters; (xii) not later than the last day of each fiscal year of the Company, a report in form and substance satisfactory to the Agent outlining all material insurance coverage maintained as of the date of such report by the Company and its Subsidiaries and all material insurance coverage planned to be maintained by such Persons in the subsequent fiscal year; (xiii) in writing, promptly upon an executive officer of the Company obtaining knowledge that the Company or any of its Subsidiaries has received notice or otherwise learned of any claim, demand, action, event, condition, report or investigation indicating any potential or actual liability arising in connection with (x) the noncompliance with or violation of the requirements of any Environmental Law that could reasonably be expected to have, in dividually or in the aggregate, a Material Adverse Effect, (y) the Release or threatened Release of any Hazardous Material, substance or constituent into the environment that could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect or that Release the Company or any of its Subsidiaries would have a duty to report to a Tribunal under an Environmental Law, or (z) the existence of any Environmental Lien on any properties or assets of the Company or any of its Subsidiaries; 60 -55- (xiv) promptly after the availability thereof, copies of all material amendments to the certificate of incorporation or by-laws of the Company or Chancellor; (xv) promptly upon any Person becoming a Subsidiary of the Company, a written notice setting forth with respect to such Person (a) the date on which such Person became a Subsidiary of the Company and (b) all of the data required to be set forth in Schedule B with respect to all Subsidiaries of the Company; and (xvi) with reasonable promptness, such other information and data with respect to the Company or any of its Subsidiaries or any of their respective property, business or assets as from time to time may be reasonably requested by any Lender; provided that no information or data shall be required to be delivered hereunder or under any other provision of this Agreement if it would violate any applicable attorney-client or accountant-client privilege. 5.2. Corporate Existence, Etc. The Company will at all times preserve and keep in full force and effect its corporate existence and rights and franchises to its business and those of each of its Subsidiaries, except as permitted by Section 6.6 or where the failure to so preserve or keep will not, singly or in the aggregate, have a Material Adverse Effect. 5.3. Payment of Taxes and Claims The Company will, and will cause each of its Subsidiaries to, pay all material Taxes, assessments and other governmental charges imposed upon it or any of its material properties or assets or in respect of any of its franchises, business, income or property before any material penalty accrues thereon, and all claims (including, without limitation, claims for labor, services, materials and supplies) for sums that have become due and payable and that have or may become a Lien upon any of its properties or assets prior to the time when any material penalty or fine shall be incurred with respect thereto, other than Contested Claims. 5.4. Maintenance of Properties; Insurance The Company will maintain or cause to be maintained in good repair, working order and condition, ordinary wear and tear excepted, all material properties used or useful in the business of the Company and its Subsidiaries and from time to time promptly will make or cause to be made all necessary repairs, renewals and replacements thereof; provided that nothing in this Section 5.4 shall prevent the Company or any of its 61 -56- Subsidiaries from discontinuing the use, operation or maintenance of any such properties, or disposing of any of them, if such action is in the ordinary course of business or, in the reasonable good faith judgment of the Company or such subsidiaries, necessary or desirable in the conduct of its business or otherwise permitted by this Agreement. The Company will maintain or cause to be maintained, with financially sound and reputable insurers or with self insurance programs, in each case to the extent consistent with prudent business practices and customary in its industry, insurance with respect to its properties and business and the properties and businesses of its Subsidiaries against loss or damage of the kinds (including, in any event, business interruption insurance) and in the amounts customarily carried or maintained under similar circumstances by corporations of established reputation engaged in similar businesses and owning similar properties in the same general respective areas in which the Company and its Subsidiaries operate. 5.5. Inspection The Company shall permit any authorized representatives designated by any Lender to visit and inspect any of the properties of the Company or its Subsidiaries, including, without limitation, its and their financial and accounting records, and to receive copies and extracts therefrom, and to discuss its and their affairs, finances and accounts with its and their officers and independent public accountants (provided that representatives of the Company or any of its Subsidiaries may, if it so chooses, be present at or participate in any such discussion), all upon reasonable notice and at such reasonable times during normal business hours and as often as may be reasonably requested. 5.6. Equal Security for Loan and Notes If the Company or any of its Subsidiaries shall create, assume or suffer to exist any Lien upon any of their respective property or assets, whether now owned or hereafter acquired, other than Liens permitted by the provisions of Section 6.2, the Company shall, unless waived by the Required Lenders, make or cause to be made effective provision whereby the Obligations under this Agreement will be secured by such Lien equally and ratably with any and all other Indebtedness thereby secured as long as any such Indebtedness shall be secured; provided that this covenant shall not be construed as or deemed to be a consent by the Lenders to any violation of the provisions of Section 6.2; and provided, further, that the Company shall under no circumstances be required to make or cause to be made effective provision whereby the Obligations under this Agreement will be secured, directly or indirectly, by Margin Stock. 62 -57- 5.7. Compliance with Laws, Etc. The Company shall, and shall cause each of its Subsidiaries to, comply with the requirements of all applicable Laws of any Tribunal, to the extent noncompliance, singly or in the aggregate, could reasonably be expected to have a Material Adverse Effect. 5.8. Maintenance of Accurate Records, Etc. The Company shall keep, and will cause each of its Subsidiaries to keep, true books and records and accounts in which full and correct entries will be made of all its respective business transactions, and will reflect, and cause each of its Subsidiaries to reflect, in its respective financial statements adequate accruals and appropriations to reserves all in accordance with GAAP and consistent with prior business practices. 5.9. ERISA Compliance Each of the Company and its Subsidiaries will (i) make prompt payment of all contributions that it is obligated to make under (x) all Pension Plans and that are required to meet the minimum funding standard set forth in ERISA with respect to each of the Pension Plans that is not a Multiemployer Plan, and (y) all Multiemployer Plans, (ii) within 30 days after the filing thereof, furnish to the Lenders each Schedule B to the annual return/report (Form 5500 Series), required to be filed with the Department of Labor and/or the Internal Revenue Service pursuant to ERISA, with respect to each of the Pension Plans that is not a Multiemployer Plan for each Plan year, and (iii) notify the Lenders promptly upon becoming aware of any fact, including but not limited to, any Reportable Event arising in connection with any of the Pension Plans that is not a Multiemployer Plan, which could be reasonably expected to constitute grounds for termination thereof by the PBGC or for the appointment by the appropriate United States District Court of a trustee to administer such Pension Plan, together with a statement as to the action, if any, proposed to be taken with respect thereto. 5.10. Register The Company hereby designates the Agent to serve as the Company's agent, solely for purposes of this Section 5.10, to maintain a register (the "Register") on which it will record the Bridge Loan made by the Lenders and the repayment in respect of the principal amount of the Bridge Loan of the Lenders. Failure to make any such recordation, or any error in such recordation, shall not affect the Company's obligations in respect of the Bridge Loan. The transfer of the Bridge Loan 63 -58- Commitment of the Lenders and the rights to the principal of, and interest on, the Bridge Loan made pursuant to the Bridge Loan Commitment shall not be effective until such transfer is recorded on the Register maintained by the Agent with respect to ownership of the Bridge Loan Commitment and the Bridge Loan and prior to such recordation all amounts owing to the transferor with respect to such Bridge Loan Commitment and Bridge Loan shall remain owing to the transferor. The registration of assignment or transfer of all or part of the Bridge Loan Commitment and the Bridge Loan shall be recorded by the Agent on the Register only upon the receipt by the Agent of a properly executed and delivered assignment and assumption agreement pursuant to Section 9.2A. Coincident with the delivery of such an assignment and assumption agreement to the Agent for acceptance and registration of assignment or transfer of all or part of the Bridge Loan, or as soon thereafter as practicable, the Lenders shall surrender the Notes evidencing the Bridge Loan, and thereupon a new Notes of the same type and in the same aggregate principal amount shall be issued to the assigning or transferor Lenders and/or the new Lenders. 5.11 Environmental Covenants. A. Promptly upon, and in any event within ten (10) Business Days after, an officer of the Company or Chancellor obtains knowledge thereof, it will furnish to Agent notice of the following environmental matters, unless such environmental matters could not, individually or when aggregated with all other such environmental matters, be reasonably expected to materially and adversely affect the business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Company or of the Company and its Subsidiaries taken as a whole: (1) any pending or threatened Environmental Claim against the Company or Chancellor or any Real Property owned, leased or operated by the Company or Chancellor; (2) any condition or occurrence on or arising from any Real Property owned, leased or operated by the Company or Chancellor that (a) results in noncompliance by the Company or Chancellor with any applicable Environmental Law or (b) could reasonably be expected to form the basis of an Environmental Claim against the Company or Chancellor or any such Real Property; (3) any condition or occurrence on any Real Property owned, leased or operated by the Company or Chancellor that could reasonably be expected to cause such Real Property to be subject to any restrictions on the ownership, occupancy, use or transferability by the Company or Chancellor of such Real Property under any Environmental Law; and 64 -59- (4) the taking of any removal or remedial action in response to the actual or alleged presence of any Hazardous Material on any Real Property owned, leased or operated by the Company or Chancellor as required by any Environmental Law or any governmental or other administrative agency; provided that in any event the Company shall deliver to Agent all notices received by it or Chancellor from any government or governmental agency or other Person under, or pursuant to, CERCLA or similar state law. All such notices shall describe in reasonable detail the nature of the claim, investigation, condition, occurrence or removal or remedial action and the Company's or Chancellor's response thereto. In addition, the Company will provide Agent with copies of all material communications with any government or governmental agency relating to Environmental Law, all communications with any Person (other than its attorneys) relating to Environmental Claims, and such detailed reports of any Environmental Claim as may reasonably be requested by the Agent. B. The Company will comply, and will cause each Subsidiary to comply, in all material respects with any Environmental Law applicable to the ownership or use of any or all of the Real Property now or hereafter owned, leased or operated by the Company or Chancellor, will promptly pay or cause to be paid all costs and expenses incurred in connection with such compliance, and will keep or cause to be kept all such Real Property free and clear of any Liens imposed pursuant to such Environmental Law. None of the Company or Chancellor will generate, use, treat, store, release or dispose of, or permit the generation, use, treatment, storage, release or disposal of Hazardous Material on any Real Property now or hereafter owned, leased or operated by the Company or Chancellor, or transport or permit the transportation of Hazardous Material to or from any such Real Property except for Hazardous Material used or stored at any such Real Properties in material compliance with all applicable Environmental Law and reasonably required in connection with the operation, use and maintenance of any such Real Property, and so as not to give rise to a material Environmental Claim. C. At the written request of Agent or the Lenders, at any time and from time to time, the Company will provide, at the Company's sole cost and expense, an environmental site assessment report concerning any Real Property now or hereafter owned, leased or operated by the Company or Chancellor, prepared by an environmental consulting firm chosen by the Company and approved by Agent; provided that such approval may not be unreasonably withheld, indicating the presence or absence of Hazardous Material and the potential cost of any required removal or remedial action in connection with any Hazardous Material on such Real Property; and further provided that such request may be made only if (1) there has occurred and is continuing an 65 -60- Event of Default, (2) the Agent reasonably believes that the Company or Chancellor or any such Real Property is not in material compliance with an applicable Environmental Law, or (3) circumstances exist that reasonably could be expected to form the basis of an Environmental Claim against the Company or Chancellor. If the Company fails to provide the same within 90 days after such request was made, Agent may order the same, and the Company shall grant and hereby grants to Agent and the Lenders and their agents access to such Real Property and specifically grants Agent and the Lenders an irrevocable non-exclusive license, subject to the rights of tenants, to undertake such an assessment, all at the Company's expense. SECTION 6 NEGATIVE COVENANTS The Company covenants and agrees that until the satisfaction in full of the Bridge Loan and the Notes and all other Obligations due under this Agreement it will fully and timely perform all covenants in this Section 6. 6.1. Indebtedness The Company shall not, and shall not cause or permit any of its Subsidiaries, directly or indirectly, to Incur, or remain or become directly or indirectly liable with respect to, any Indebtedness, except for the following ("Permitted Indebtedness"): (i) the Company may Incur and remain liable with respect to the Obligations and the Notes; (ii) The Company and its Subsidiaries may Incur and remain liable with respect to Indebtedness under the Bank Financing Documents as such Bank Financing Documents are in effect on the Closing Date. (iii) the Subsidiaries of the Company may become and remain liable with respect to Contingent Obligations permitted by Section 6.5 and, upon any matured obligations actually arising pursuant thereto, the Indebtedness corresponding to the Contingent Obligations so extinguished; (iv) the Company and its Subsidiaries may Incur and remain liable with respect to Intercompany Indebtedness; (v) the Company and its Subsidiaries may remain liable with respect to the Indebtedness that is existing on the Closing Date and is described on Schedule F; (vi) the Company and its Subsidiaries may Incur and remain liable with respect to Permitted Refinancing Indebtedness; 66 -61- (vii) (A) unsecured Indebtedness of the Subsidiaries owing to the seller in any acquisition permitted pursuant to Section 6.4(xi) and Section 6.12(iv) or (B) Indebtedness of the Subsidiaries of the Company assumed in connection with any such acquisition of an asset securing such Indebtedness in an aggregate principal amount not to exceed $3,750,000 at any time outstanding, for both clause (A) and clause (B) provided that such Indebtedness was not incurred in connection with, or in anticipation or contemplation of, such acquisition; (viii) the Company and its Subsidiaries may Incur and remain liable with respect to Indebtedness evidenced by Capitalized Lease Obligations in an amount not to exceed $3,000,000 in any fiscal year; (ix) the Company and its Subsidiaries may Incur and remain liable with respect to Indebtedness subject to Liens permitted under Section 6.2; and (x) the Company and its Subsidiaries may become and remain liable with respect to other Indebtedness in an aggregate principal amount not to exceed at any time outstanding $10,000,000. 6.2. Liens The Company shall not, and shall not cause or permit any of its Subsidiaries to, directly or indirectly, create, incur, assume or permit to exist any Lien on or with respect to any property or asset (including any document or instrument in respect of goods or accounts receivable) of the Company or of any of its Subsidiaries, whether now owned or hereafter acquired, or assign or otherwise convey any right to receive any income or profits therefrom, or file or permit the filing of, or permit to remain in effect, any financing statement or other similar notice of any Lien with respect to any such property, asset, income or profits under the UCC of any State or under any similar recording or notice statute, except: (i) Permitted Encumbrances; (ii) Liens on (a) Real Property Assets or (b) equipment, fixtures and other similar property of the Company and any of its Subsidiaries, in each case securing Indebtedness described in Section 6.1; provided that such Liens shall extend only to the equipment, fixtures, and other similar property so financed (and improvements or attachments thereto) and the proceeds thereof; (iii) the replacement, extension or renewal of any Lien permitted by this Section 6.2 upon or in the same property subject to such Lien and as security for the same obligations 67 -62- or any refinancings thereof to the extent such refinancings are permitted under Section 6.1; provided that such Lien does not extend to or cover any property other than the property covered by such Lien immediately prior to such replacement, extension or renewal of such Lien (and improvements or attachments thereto) and the principal of the obligations secured thereby is not increased; (iv) Liens upon assets subject to Capitalized Lease Obligations to the extent permitted by Section 6.1(viii), provided that (x) such Liens only serve to secure the payment of Indebtedness arising under such Capitalized Lease Obligation and (y) the Lien encumbering the asset giving rise to the Capitalized Lease Obligation does not encumber any other asset of the Company or any Subsidiary of the Company; (v) deposits made in the ordinary course of business to secure liabilities for premiums to insurance carriers, provided that such deposits do not exceed in the aggregate an amount equal to $2,500,000 at any time; (vi) Liens to secure obligations permitted by Section 6.12(v); (vii) Liens on property or assets in existence at the time such property or assets are acquired pursuant to Section 6.4(xi) and Section 6.12(iv), provided that (x) any Indebtedness that is secured by such Liens is permitted to exist under Section 6.1(vii), and (y) such Liens are not incurred in connection with, or in contemplation or anticipation of, such acquisition and do not attach to any other asset of the Company or any of its Subsidiaries; (viii) cash earnest money deposits in connection with acquisitions otherwise permitted under this Agreement in an amount not to exceed $10,000,000 in the aggregate; and (ix) additional Liens securing Indebtedness of the Company and its Subsidiaries not otherwise permitted under this Section 6.2 to the extent attaching to properties and assets with an aggregate fair market value not in excess of and securing liabilities not in excess of $2,500,000. 6.3. Restricted Payments The Company shall not, and shall not cause or permit any of its Subsidiaries to, directly or indirectly, (a) declare or pay any dividend, or make any distribution, on any Capital Stock of the Company (other than (i) dividends or distributions payable solely in Qualified Capital Stock of the Company and (ii) dividends on the Company's 7% Convertible Preferred Stock), (b) purchase, redeem or otherwise acquire or retire for 68 -63- value any of the Company's Capital Stock, or any warrants, rights or options to acquire shares of any class of such Capital Stock or (c) make any principal payment on, purchase, defease, redeem, prepay, or otherwise acquire or retire for value, other than any scheduled final maturity, scheduled repayment or scheduled sinking fund payment, any Subordinated Indebtedness or Pari Passu Indebtedness of the Company (any such dividend, distribution, purchase, redemption, acquisition, retirement, defeasance or prepayment set forth in clauses (a), (b) and (c) above a "Restricted Payment"). Notwithstanding the foregoing, (i) any Subsidiary of the Company may pay dividends to the Company or any Subsidiary of the Company; (ii) the Company may pay cash dividends, and Chancellor may pay cash dividends to the Company to enable the Company, to make payments (A) to pay management fees or executive compensation to the extent such management fees or executive compensation are permitted by the Bank Financing Documents and pursuant to the Monitoring and Oversight Agreements (as defined in the Bank Financing Documents and to the extent permitted therein), (B) to repurchase the Company's Common Stock and/or options to purchase Company Common Stock held by (x) Dinetz pursuant to the Dinetz Employment Contract (as defined in the Bank Financing Documents) or (y) directors, executives, officers, members of management, or employees of the Company or any of its Subsidiaries upon the exercise of options in accordance with the Employee Stock Option Plan (as defined in the Bank Financing Documents), or (z) other stockholders of the Company so long as the purpose of such purchase is to acquire Company Common Stock for reissuance to new employees of the Company and its Subsidiaries to the extent so reissued within 12 months of any such purchase so long as the aggregate amount of cash expended by the Company pursuant to subclause (B) of this clause (iii) shall not exceed $2,500,000 in any fiscal year or $5,000,000 in the aggregate (plus the amount of cash proceeds paid by any new employee in consideration for reissuance of Company Common Stock repurchased by the Company to the extent received by the Company within 12 months following any such repurchase, minus the amount of cash paid in respect of the Company's Subordinated Notes permitted under Section 9.11(ii) of the Bank Financing Documents), and (C) on the Company's Subordinated Notes, to the extent permitted under Section 9.11(ii) of the Bank Financing Documents, so long as in the case of subclauses (B) and (C) of this clause (iii), no Potential Event of Default or Event of Default exists or would result therefrom; (iii) Chancellor may pay cash dividends to the Company for the purpose of paying, so long as all proceeds thereof are promptly used by the Company to pay franchise taxes and fed- 69 -64- eral, state and local income taxes and interest, and penalties with respect thereto, if any, payable by the Company; (iv) Chancellor may pay cash dividends to the Company to enable the Company to pay cash dividends to redeem fractional shares of its common stock so long as the aggregate amount thereof does not exceed $5,000; (v) Chancellor may pay regularly scheduled dividends on its Exchangeable Preferred Stock pursuant to the terms thereof solely through the issuance of additional shares of Exchangeable Preferred Stock; (vi) Chancellor may pay cash dividends to the Company for the purpose of making, so long as all proceeds thereof are promptly used by the Company to make, cash payments in lieu of issuing fractional shares of Company Common Stock upon the conversion of the Convertible Preferred Stock in an aggregate amount not to exceed $150,000; (vii) Chancellor may pay cash dividends on its Exchangeable Preferred Stock in lieu of issuing fractional shares of Exchangeable Preferred Stock; and (viii) Chancellor may pay cash dividends to the Company for the purpose of making, so long as all proceeds thereof are promptly used by the Company to make, payments (including voluntary prepayments) in respect of principal under this Agreement. 6.4. Investments The Company shall not, and shall not cause or permit any of its Subsidiaries to, directly or indirectly, make or own any Investment (other than Permitted Investments) in any Person, except: (i) the Company and its Subsidiaries may continue to own the Investments owned by them as of the Closing Date described on Schedule B; (ii) the Company and its Subsidiaries may make and own Investments received in connection with the bankruptcy of suppliers and customers or received pursuant to a plan of reorganization of any supplier or customer, in each case in settlement of delinquent obligations or disputes with such suppliers or customers; (iii) the Company and its Subsidiaries may acquire and hold accounts receivables owing to any of them, if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary terms; 70 -65- (iv) the Company and its Subsidiaries may make loans and advances in the ordinary course of business to their respective officers, directors and employees so long as the aggregate principal amount thereof at any time outstanding (determined without regard to any write-downs or write-offs of such loans and advances) shall not exceed $1,000,000; (v) the Company may enter into Interest Protection Agreements to the extent entered into pursuant to the Bank Financing Documents; (vi) the Company may repurchase Company Common Stock to the extent permitted by Section 6.3; (vii) promissory notes and other similar non-cash consideration received by the Company and its Subsidiaries in connection with dispositions permitted by Section 6.6 and Section 6.12, so long as the aggregate principal amount thereof does not exceed $1,000,000 at any one time outstanding; (viii) investments by the Company in any Subsidiary; (ix) investments by the Company or any of its Subsidiaries to the extent permitted by Section 9.07 of the Bank Financing Documents; (x) guarantees of Indebtedness made by the Company or any of its Subsidiaries to the extent otherwise permitted by Section 6.1; (xi) so long as no Potential Event of Default or Event of Default then exists or would arise therefrom, the Company may permit its Subsidiaries to, acquire the capital stock or assets of any Person so long as (x) any such acquisition is for all the capital stock or all or substantially all of the business of, or an operating division or a business unit of, such Person, (y) the aggregate consideration paid (including Indebtedness assumed in connection therewith) pursuant to this clause (xiii) does not exceed $50,000,000 and (z) the Company shall be in compliance with the financial covenants contained in Sections 9.08 through 9.10, inclusive, of the Bank Financing Documents, with such financial covenants to be calculated on pro forma basis as if such acquisition had been consummated on the first day of the then most recently ended Test Period (as defined in the Bank Financing Documents) (and any Indebtedness incurred, issued or assumed in connection therewith had been incurred on the first day of, and remained outstanding throughout, such Test Period); and (xii) in addition to investments permitted by clause (i) through (xi) of this Section 6.4, the Company and its Subsidiaries may make additional loans, advances and investments 71 -66- in an aggregate principal amount not to exceed $2,500,000 at any time outstanding. 6.5. Contingent Obligations The Company shall not, and shall not cause or permit any of its Subsidiaries to, directly or indirectly, create or become or remain liable with respect to any Contingent Obligation, except: (i) the Company and its Subsidiaries may become and remain liable with respect to Contingent Obligations outstanding on the Closing Date described in Schedule F, which Contingent Obligations may be refinanced, extended, renewed, refunded or defeased in whole or in part; (ii) the Company and its Subsidiaries may become and remain liable with respect to Contingent Obligations in respect of customary indemnification and purchase price adjustment obligations incurred in connection with the Acquisition, Asset Sales or other sales of assets; provided that the maximum assumable liability in respect of all such obligations shall at no time exceed the gross proceeds actually received by the Company and its Subsidiaries in connection with such Asset Sales and other sales; (iii) the Company and its Subsidiaries may become and remain liable with respect to guarantees of Indebtedness or Contingent Obligations of a Wholly Owned Subsidiary of the Company and a Subsidiary of the Company may become and remain liable with respect to guarantees of Indebtedness or Contingent Obligations of the Company or a Wholly Owned Subsidiary of the Company; (iv) the Company and its Subsidiaries may become and remain liable with respect to Contingent Obligations that (A) exist at the time a Person becomes a Subsidiary of the Company or (b) are assumed in connection with the acquisition of assets from a Person, but not incurred in contemplation of such Person becoming a Subsidiary of the Company; (v) the Company and its Subsidiaries may Incur and remain liable with respect to guarantees (other than guarantees of Indebtedness which is not a Capitalized Lease Obligation) made in the ordinary course of business, provided that such guarantees could not, individually or in the aggregate, have a Material Adverse Effect; (vi) the Company and its Subsidiaries may Incur and remain liable with respect to Contingent Obligations under Interest Rate Protection Agreements (as defined in the Bank Fi- 72 -67- nancing Documents) to the extent entered into pursuant to the Bank Financing Documents. 6.6. Restriction on Fundamental Changes, Asset Purchases or Sales Subject to Section 5.2 and other than the sale of 100% of a Subsidiary of the Company in accordance with Section 2.4A(ii)(b) and Section 6.12, the Company shall not, and shall not cause or permit any of its Subsidiaries to, directly or indirectly, enter into any transaction, or series of related transactions, or merger, amalgamation, consolidation or combination, or consolidate, or liquidate, windup or dissolve itself (or suffer any liquidation or dissolution), or convey, sell, lease, sublease, transfer or otherwise dispose of, in one transaction or in a series of transactions, all or substantially all of its business, property or assets, whether now owned or hereafter acquired, except: (i) in connection with the Acquisition or the Evergreen Merger; (ii) Capital Expenditures (as defined in the Bank Financing Documents) made by Chancellor and its Subsidiaries in the ordinary course of business; (iii) investments may be made to the extent permitted by Section 6.4 and Section 6.12; (iv) to the extent otherwise permitted pursuant to the Bank Financing Documents, the sale or other disposition of Stations of Chancellor or its Subsidiaries shall be permitted for cash at fair market value (as determined in good faith by the Company) so long as the proceeds thereof are applied in accordance with the requirements of this Agreement and Section 4.02(e) of the Bank Financing Documents; (v) the WDRQ Detroit Disposition (as defined in the Bank Financing Documents) shall be permitted; and (vi) any Subsidiary of the Company may be merged, amalgamated, consolidated or combined with or into the Company or any Wholly Owned Subsidiary of the Company or be liquidated, wound up or dissolved, or all or substantially all of its business, property or assets may be conveyed, sold, leased, transferred or otherwise disposed of, in one transaction or in a series of transactions, to the Company or to any Wholly Owned Subsidiary of the Company; provided that (A) no Potential Event of Default or Event of Default shall have occurred and be continuing or would result therefrom, (B) in the case of such a merger, amalgamation, consolidation or combination of the Company and a Subsidiary of the Company, the Company shall be the 73 -68- continuing or surviving corporation, and (C) the surviving entity (I) continues to be bound as such under this Agreement and (II) executes and delivers to the Agent immediately upon consummation of such transaction a written confirmation or acknowledgment to such effect, in form and substance satisfactory to the Agent, together with evidence of appropriate corporate power, authority and action and a written legal opinion in form and substance satisfactory to the Agent to the effect that this Agreement continues to be a legal, valid and binding obligation of such entity, enforceable against such entity in accordance with its terms (subject to customary exceptions in respect of bankruptcy, insolvency and other equitable remedies) and with respect to such other matters as the Agent may reasonably request. 6.7. Limitation on Dividend and Other Payment Restrictions Affecting Subsidiaries The Company shall not, and shall not cause or permit any of its Subsidiaries to, directly or indirectly, create or otherwise cause or permit or suffer to exist or become effective any encumbrance or restriction on the ability of any Subsidiary of the Company to (a) pay dividends or make any other distributions on its Capital Stock or any other interest or participation in, or measured by, such Subsidiary's profits; (b) make loans or advances or pay any Indebtedness or other obligation owed to the Company or to any Subsidiary of the Company; or (c) transfer any of its property or assets to the Company or to any Subsidiary of the Company (any such restriction or encumbrance a "Payment Restriction"), and except as permitted under any certificate of designation governing the terms of any issue of Preferred Stock of Chancellor and except for such encumbrances or restrictions existing under or by reason of: (1) any restrictions contained in (i) the Bank Financing Documents, the Loan Documents or the Chancellor Indentures or (ii) secured Indebtedness otherwise permitted to be incurred pursuant to Sections 6.1 and 6.2 that limits the right of the debtor to dispose of the assets securing such Indebtedness; (2) any restrictions contained in the Acquisition Agreement; (3) customary nonassignment provisions of any lease or sublease governing a leasehold interest of any Subsidiary of the Company; (4) customary net worth provisions contained in leases and other agreements entered into by a Subsidiary in the ordinary course of business; (5) customary restrictions with respect to a Subsidiary pursuant to an agreement that has been entered into for the sale or disposition of all or substantially all of the Capital Stock or assets of such Subsidiary; (6) applicable law; (7) any instrument that Refinances any Indebtedness effecting any such encumbrance or restriction pursuant to clause (1) above; provided that the provisions relating to any such encumbrance or restriction in any such instrument are not materially less favorable to the Company or its Sub- 74 -69- sidiaries or the Lenders than those contained in the agreements referred to in clause (1); and (8) customary provisions restricting assignment of any licensing agreement entered into by a Subsidiary in the ordinary course of business. 6.8. Restrictions on Additional Acquisitions The Company shall not, and shall not cause or permit any of its Subsidiaries to, directly or indirectly, enter into any agreements to purchase or acquire all or a substantial portion of the business, property or assets of, or stock or other evidence of beneficial ownership of, any Person or any direction or line of business of any Person, other than the Acquisition or as permitted pursuant to Section 6.6. 6.9. Transactions with Affiliates The Company will not, and will not permit any of its Subsidiaries to enter into any transaction or series of related transactions, whether or not in the ordinary course of business, with any Affiliate of the Company or any of its Subsidiaries, other than in the ordinary course of business and on terms and conditions substantially as favorable to the Company or such Subsidiary as would reasonably be obtained by the Company or such Subsidiary at that time in a comparable arm's-length transaction with a Person other than an Affiliate, except that: (i) Dividends may be paid to the extent provided in Section 6.3; (ii) loans may be made and other transactions may be entered into by the Borrower and its Subsidiaries to the extent permitted by Sections 6.1, 6.4, 6.5 and 6.6; (iii) customary fees and reimbursement of expenses may be paid to directors of the Company; (iv) the Company, or to the extent not paid by the Company, Chancellor, may pay to Hicks, Muse & Co. Partners, L.P., its Affiliates or any successor thereto controlled by Jack D. Furst, Charles W. Tate, Thomas O. Hicks and/or John R. Muse, the amounts set forth in the Amended and Restated Financial Monitoring and Oversight Agreement dated as of January 1, 1996, among the Company, Chancellor and Hicks, Muse & Co. Partners, L.P. and the Financial Advisory Agreement dated as of January 1, 1996 among HM2/Management Partners L.P., the Company and Chancellor in the form delivered to the Agent on or prior to the Closing Date, as it may be modified thereafter but without giving effect to any modifications thereto that in any way adversely affects the interests of the Lenders (including, without limitation, by increasing in any respect the costs or 75 -70- liabilities of the Company or any of its Subsidiaries) without the consent of the Required Lenders other than increases in base fees as previously disclosed to the Agent (collectively, "the Monitoring and Oversight Agreements"); (v) the Company and its Subsidiaries may enter into and make payments pursuant to employment arrangements with executive officers and senior management employees in the ordinary course of business; (vi) the Company and its Subsidiaries may make payments pursuant to employment agreements existing on the Closing Date; (vii) the Company and its Subsidiaries may make payments pursuant to the Tax Sharing Agreements; (viii) the Company and its Subsidiaries may maintain their present Operating Agreements (as defined in the Bank Financing Documents); and (ix) the Company may make capital contributions to Chancellor. 6.10. Subsidiary Stock Except for any sale of 100% of the Capital Stock or other equity securities of any of the Company's Subsidiaries in compliance with the provisions of Section 6.6, the Company will not, and will not permit any of its Subsidiaries to directly or indirectly sell, assign, pledge or otherwise encumber or dispose of any shares of Capital Stock or other equity securities of any of its Subsidiaries, except (i) to the Company or to a Wholly Owned Subsidiary of the Company, (ii) Asset Sales made in compliance with this Agreement or (iii) as security under the Bank Financing Documents. 6.11. Business Activities The Company shall not, and shall not cause or permit any of its Subsidiaries to, directly or indirectly, materially alter the nature of the consolidated business of the Company and its Subsidiaries from that in existence immediately after giving effect to the Transactions or similar or related businesses. The Company shall not engage in any business or other activity other than the ownership of the Capital Stock of the Subsidiaries of the Company. 6.12. Asset Sales (a) The Company shall not, and shall not cause or permit any of its Subsidiaries to, directly or indirectly, con- 76 -71- summate any Asset Sale unless (1) the Company or such Subsidiary, as the case may be, receives consideration therefor at the time thereof at least equal to the fair market value at the time of such Asset Sale of the property, assets or stock that is the subject of such Asset Sale, (2) at least 75% of the consideration received therefor by the Company or such Subsidiary is in the form of cash or Cash Equivalents and (3) all of the Net Cash Proceeds in respect thereof are applied by the Company or a Subsidiary of the Company in accordance with Section 2.4A(ii)(b). (b) Notwithstanding the foregoing, none of the following shall be an Asset Sale for the purposes of Section 2.4(A)(ii)(b): (i) each of the Company and its Subsidiaries may make sales or other transfers of airtime in the ordinary course of business and consistent with past practices; (ii) licenses or sublicenses by the Company and its Subsidiaries of software, trademarks and other intellectual property and general intangibles and licenses, leases or subleases of other property in the ordinary course of business and which do not materially interfere with the business of the Company or any Subsidiary; (iii) the Company or any Subsidiary of the Company may transfer assets to or lease assets to or acquire or lease assets from the Company or any Subsidiary to the extent permitted under the Bank Financing Documents or any Subsidiary of Chancellor may be merged or consolidated with or into, or be liquidated or dissolved into, Chancellor or any other Subsidiary of the Company (so long as Chancellor or such Subsidiary is the surviving corporation); (iv) to the extent otherwise permitted pursuant to the Bank Financing Documents, Chancellor may, and may permit its Subsidiaries to, simultaneously enter into a Station Swap or a Stock Swap (each as defined in the Bank Financing Documents), so long as any cash proceeds received by Chancellor or any of its Subsidiaries in connection with any such Stock Swap or Station Swap shall be applied in accordance with Section 2.4A(ii)(b) of this Agreement and Section 4.02(e) of the Bank Financing Documents; (v) the Company and its Subsidiaries may sell or discount, accounts receivable arising in the ordinary course of business (x) which are overdue or (y) which the Company or its Subsidiaries may reasonably determine are difficult to collect, but only in connection with the compromise or collection thereof consistent with customary industry practice (and not as part of any bulk sale or financing of receivables); 77 -72- (vi) transfers of condemned property to the respective governmental authority or agency that have condemned same (whether by deed in lieu of condemnation or otherwise), and transfers of properties that have been subject to a casualty to the respective insurer of such property or its designee as part of any insurance settlement, so long as the proceeds thereof are applied as required by Section 4.02(g) of the Bank Financing Documents; (vii) the SFX Exchange (as defined in the Bank Financing Documents) shall be permitted; and (viii) each of the Company and its Subsidiaries may sell or otherwise dispose of equipment in the ordinary course of business which, in the reasonable judgment of such Person, is obsolete, worn out or otherwise no longer useful, in the conduct of such Person's business. Nothing in this covenant shall be deemed to prevent the exercise of remedies by secured creditors of the Company or any Subsidiary of the Company. SECTION 7 EVENTS OF DEFAULT If any of the following conditions or events ("Events of Default") shall occur and be continuing: 7.1. Failure To Make Payments When Due Failure to pay any installment of principal of or interest on the Bridge Loan when due, whether at stated maturity, by acceleration, by notice of prepayment or otherwise; or 7.2. Default in Other Agreements (A) Failure of the Company or any of its Subsidiaries to pay principal or interest on one or more issues of Indebtedness or Contingent Obligations of the Company or of any of its Subsidiaries when due (including, in the determination of such due date, any period of grace) (other than Indebtedness referred to in Section 7.1) or (B) breach or default by the Company or any of its Subsidiaries with respect to any other term of any one or more issues of Indebtedness or Contingent Obligations of the Company or of any of its Subsidiaries or any agreement or instrument evidencing or securing such Indebtedness or Contingent Obligations and, in any case, such failure, breach or default results in the acceleration of that Indebtedness or Contingent Obligation prior to its stated maturity and, in any case, the principal amount of such Indebtedness or Contingent Obligation and all other such Indebtedness or Contingent Obligations of the Company and its Subsidiaries in respect 78 -73- of which there is such a failure to pay principal or interest or which has been so accelerated equals $10,000,000 or more; or 7.3. Breach of Certain Covenants Failure of the Company to perform or comply with any covenant, term or condition contained in Sections 2.4A(ii), 2.4A(iv) or 5.2; or 7.4. Breach of Warranty Any representation, warranty or certification made by the Company in any Loan Document or in any statement or certificate at any time given by the Company in writing pursuant hereto or thereto or in connection herewith or therewith shall be false or incorrect in any material respect on the date as of which made or deemed made; or 7.5. Other Defaults Under This Agreement or the Notes The Company shall default in the performance of or compliance with any covenant, term or condition contained in this Agreement or the Notes (other than those covered by Section 7.1, 7.3 or 7.4) and such default shall not have been remedied or waived in accordance with this Agreement within 30 days after the date of written notice from the holder or holders of not less than 25% in aggregate principal amount of the Bridge Loan then outstanding of such default; or 7.6. FCC Denial The FCC shall have determined finally not to have granted approval of the transfer or other assignment of licenses contemplated by the Acquisition and the Acquisition Agreement. 7.7. Involuntary Bankruptcy; Appointment of Custodian, Etc. A court of competent jurisdiction enters a Bankruptcy Order under any Bankruptcy Law that: (A) is for relief against the Company or any Material Subsidiary in an involuntary case or proceeding, or (B) appoints a Custodian of the Company or any Material Subsidiary for all or substantially all of its properties, or (C) orders the liquidation of the Company or any Material Subsidiary, 79 -74- and in each case the order or decree remains unstayed and in effect for 60 days. 7.8. Voluntary Bankruptcy; Appointment of Custodian, Etc. The Company or any Material Subsidiary pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case or proceeding, or (B) consents to the entry of a Bankruptcy Order for relief against it in an involuntary case or proceeding, or (C) consents to the appointment of a Custodian of it or for all or substantially all of its property, or (D) makes a general assignment for the benefit of its creditors or files a proposal or scheme of arrangement involving the rescheduling or composition of its indebtedness, or (E) consents to the filing of a petition in bankruptcy against it, or (F) shall generally not pay its debts when such debts become due or shall admit in writing its inability to pay its debts generally. 7.9. Judgments and Attachments Any money judgment, writ or warrant of attachment, or similar process involving in any individual case or in the aggregate at any time an amount in excess of $1,000,000 (to the extent not covered by third-party insurance as to which the insurance company has not denied coverage) shall be entered or filed against the Company or any of its Subsidiaries or any of their respective properties or assets and shall remain undischarged, unvacated, unbonded or unstayed for a period of 60 days or in any event later than five days prior to the date of any proposed sale thereunder; or 7.10. Dissolution Any order, judgment or decree shall be entered against the Company or any Material Subsidiary decreeing the dissolution or split-up of the Company or that Material Subsidiary and such order shall remain undischarged or unstayed for a period in excess of 30 days. 80 -75- SECTION 8 THE AGENT 8.1. Appointment The Lenders hereby irrevocably designate and appoint Bankers Trust as Agent of the Lenders to act as specified herein and in the other Loan Documents, and the Lenders hereby irrevocably authorize Bankers Trust as the Agent to take such action on their behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto. The Agent agrees to act as such upon the express conditions contained in this Section 8. Notwithstanding any provision to the contrary elsewhere in this Agreement or in any other Loan Document, the Agent shall not have any duties or responsibilities, except those expressly set forth herein or in the other Loan Documents, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or otherwise exist against the Agent. The provisions of this Section 8 are solely for the benefit of the Agent and the Lenders, and, other than in connection with Section 8.9, the Company shall not have any rights as a third party beneficiary of any of the provisions hereof. In performing its functions and duties under this Agreement, the Agent shall act solely as agent of the Lenders and the Lenders do not assume and shall not be deemed to have assumed any obligation or relationship of agent or trust with or for the Company. 8.2. Delegation of Duties The Agent may execute any of its duties under this Agreement or any other Loan Document by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care except to the extent otherwise required by Section 8.3. 8.3. Exculpatory Provisions Neither the Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or the other Loan Documents (except for its or such Person's own gross negligence or willful misconduct) or (ii) responsible in any manner to the Lenders for any recitals, statements, representations or warranties made by the Company or any of their respective officers contained in this Agreement, any other Loan 81 -76- Documents or in any certificate, report, statement or other document referred to or provided for in, or received by the Agent under or in connection with, this Agreement or any other Loan Document or for any failure of the Company or any of its officers to perform their obligations hereunder or thereunder. The Agent shall not be under any obligation to the Lenders to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or the other Loan Documents, or to inspect the properties, books or records of the Company or Chancellor. The Agent shall not be responsible to the Lenders for the effectiveness, genuineness, validity, enforceability, collectability or sufficiency of this Agreement or any other Loan Document or for any representations, warranties, recitals or statements made herein or therein or made in any written or oral statement or in any financial or other statements, instruments, reports, certificates or any other documents in connection herewith or therewith furnished or made by the Agent to the Lenders or by or on behalf of the Company to the Agent or the Lenders or be required to ascertain or inquire as to the performance or observance of any of the terms, conditions, provisions, covenants or agreements contained herein or therein or as to the use of the proceeds of the Bridge Loan or of the existence or possible existence of any Potential Event of Default or Event of Default. 8.4. Reliance by Agent The Agent shall be entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, facsimile, telex or teletype message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons, and upon advice and statements of legal counsel (including, without limitation, counsel to the Company or any of its Subsidiaries), independent accountants and other experts selected by the Agent. The Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Required Lenders or such lesser amount as may be designated herein as it deems appropriate or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any such action. As between the Agent and the Lenders, the Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the other Loan Documents in accordance with a request of the Required Lenders or such lesser amount as may be designated herein, and such request and any action taken or failure to act pursuant thereto shall be binding upon the Lenders. 82 -77- 8.5. Notice of Default The Agent shall not be deemed to have knowledge or notice of the occurrence of any Potential Event of Default or Event of Default hereunder unless the Agent has actually received notice from the Lenders, the Company or Chancellor referring to this Agreement, describing such Potential Event of Default or Event of Default and stating that such notice is a "notice of default." In the event that the Agent receives such a notice, the Agent shall give prompt notice thereof to the Lenders. The Agent shall take such action with respect to such Potential Event of Default or Event of Default as shall be reasonably directed by the Required Lenders; provided that, as between the Agent and the Lenders unless and until the Agent shall have received such directions, the Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Potential Event of Default or Event of Default as it shall deem advisable in the best interests of the Lenders. 8.6. Nonreliance on Agent and Other Lenders The Lenders expressly acknowledges that neither the Agent nor any of its respective officers, directors, employees, agents, attorneys-in-fact or affiliates have made any representations or warranties to it and that no act by the Agent hereinafter taken, including any review of the affairs of the Company and its Subsidiaries, shall be deemed to constitute any representation or warranty by the Agent to the Lenders. Each Lender represents to the Agent that it has, independently and without reliance upon the Agent, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, assets, operations, property, financial and other condition, prospects and creditworthiness of the Company and Chancellor and made its own decision to make the Bridge Loan and enter into this Agreement. Each Lender also represents that it will, independently and without reliance upon the Agent, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement, and to make such investigation as it deems necessary to inform itself as to the business, assets, operations, property, financial and other condition, prospects and creditworthiness of the Company and Chancellor. The Agent shall not have any duty or responsibility to provide the Lenders with any credit or other information concerning the business, operations, assets, property, financial and other condition, prospects or creditworthiness of the Company or Chancellor that may come into the possession of the Lenders or any of its officers, directors, employees, agents, attorneys-in-fact or affiliates. 83 -78- 8.7. Indemnification The Lenders agree to indemnify the Agent in its capacity as such ratably according to their respective "percentages" as used in determining the Required Lenders at such time, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, reasonable expenses or disbursements of any kind whatsoever which may at any time (including, without limitation, at any time following the payment in full of the Obligations) be imposed on, incurred by or asserted against the Agent in its capacity as such in any way relating to or arising out of this Agreement or any other Loan Document, or any documents contemplated by or referred to herein or the transactions contemplated hereby of any action taken or omitted to be taken by the Agent under or in connection with any of the foregoing, but only to the extent that any of the foregoing is not paid by the Company; provided that the Lenders shall not be liable to the Agent for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting solely from the gross negligence or willful misconduct of the Agent. If any indemnity furnished to the Agent for any purpose shall, in the opinion of the Agent be insufficient or become impaired, the Agent may call for additional indemnity and cease, or not commence, to do the acts indemnified against until such additional indemnity is furnished. The agreements in this Section 8.7 shall survive the payment in full of all Obligations. 8.8. Agent in Its Individual Capacity The Agent and its affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Company as though the Agent were not the Agent hereunder. With respect to the Bridge Loan made by it as a Lender and all Obligations owing to it as a Lender, the Agent shall have the same rights and powers under this Agreement as the other Lenders and may exercise the same as though it were not the Agent and the terms "Lender" and "Lenders" shall include the Agent in its individual capacity. 8.9. Resignation of the Agent; Successor Agent The Agent may resign as the Agent upon 20 days' notice to the Lenders and the Company. Upon the resignation of the Agent, the Required Lenders shall appoint a successor Agent that is a bank or a trust company for the Lenders subject to prior approval by the Company (such approval not to be unreasonably withheld or delayed), whereupon such successor agent shall succeed to the rights, powers and duties of the Agent, and the term "Agent" shall include such successor agent effective upon its appointment, and the resigning Agent's rights, 84 -79- powers and duties as the Agent shall be terminated, without any other or further act or deed on the part of such former Agent or any of the parties to this Agreement. If no successor Agent has been appointed as provided above by the 20th day after the date such notice of resignation was given by the Agent, the Agent's resignation shall become effective and the Required Lenders shall thereafter perform all the duties of the Agent hereunder and/or any other Loan Documents until such time, if any, as the Lenders appoint a successor Agent as provided above (and subject to the Company's approval as provided above). After the resignation of the Agent hereunder, the provisions of this Section 8 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement. SECTION 9 MISCELLANEOUS 9.1. Representation of the Lenders Each Lender hereby represents that it is a commercial lender that makes loans in the ordinary course of its business and that it will make the Bridge Loan hereunder for its own account or the account of its affiliates in the ordinary course of such business. 9.2. Participations in and Assignments or Syndication of the Bridge Loan and Notes A. The Lenders shall have the right at any time to participate out, sell, assign or syndicate all or any portion of the Notes or the Bridge Loan Commitment in an aggregate amount of not less than $1,000,000 upon the earlier to occur of December 31, 1997 and the date on which the Evergreen Merger is terminated, among any Eligible Assignee. In the case of any sale, transfer or negotiation of all or part of the Notes or the Bridge Loan Commitment authorized under this Section 9.2A, the assignee, transferee or recipient shall become a party to this Agreement as a Lender by execution of an assignment and assumption agreement; provided that (i) at such time Section 2.1A shall be deemed modified to reflect the Bridge Loan Commitment of such new Lenders and of any existing Lenders, (ii) upon surrender of the Notes, new Notes will be issued, at the Company's expense, to such new Lenders and to the assigning Lenders, such new Notes to be in conformity with the requirements of Section 2.1D (with appropriate modifications) to the extent needed to reflect the revised Bridge Loan Commitment, and (iii) the Agent shall receive at the time of each such assignment, from the assigning or assignee Lenders, the payment of a non-refundable assignment fee of $3,000.00; and provided, further, that such transfer or assignment will not be effective until recorded by the Agent on the Register pursuant to Section 5.10. To the extent of any assignment pursuant to this Section 9.2A, each as- 85 -80- signing Lender shall be relieved of its obligations hereunder with respect to its assigned Bridge Loan Commitment, and the assignee, transferee or recipient shall have, to the extent of such sale, assignment, transfer or negotiation, the same rights, benefits and obligations as it would if it were a Lender with respect to such Notes or Bridge Loan Commitment, including, without limitation, the right to approve or disapprove actions that, in accordance with the terms hereof, require the approval of the Lenders. At the time of each assignment pursuant to this Section 9.2A to an Eligible Assignee that is not already a Lender hereunder and that is not a United States Person (as such term is defined in Section 7701(a)(30) of the Internal Revenue Code) for federal income tax purposes, the respective Eligible Assignee shall provide to the Company and the Agent the appropriate Internal Revenue Service Forms (and, if applicable, a Tax Certificate) described in Section 9.19F. Notwithstanding the foregoing, no Eligible Assignee, which as of the date of any assignment to it pursuant to Section 9.2A would be entitled to receive any greater payment under Section 9.19 than the assigning Lenders would have been entitled to receive as of such day under such Section with respect to the rights assigned, shall be entitled to receive such payments unless the Company has expressly consented in writing to waive the benefit of this provision at the time of the assignment. B. The Lenders may grant participations in all or any part of the Notes or the Bridge Loan Commitment in an aggregate amount of not less than $1,000,000 to a member of the Syndicate Group or to any Eligible Assignee, as the case may be, other than to an Eligible Assignee that has, or has an Affiliate that has, a principal line of business similar to any principal line of business of the Company. In the event of any such sale by the Lenders of a participating interest to a participant, each Lender's obligations under this Agreement shall remain unchanged, such Lenders shall remain solely responsible for the performance thereof, such Lenders shall remain the holder of the Notes for all purposes under this Agreement and the other Loan Documents and the Company and the agent shall continue to deal solely and directly with the Lenders in connection with each Lender's rights and obligations under this Agreement and the other Loan Documents. Any agreement pursuant to which any Lender shall sell any such participating interest shall provide that such Lender shall retain the sole right and responsibility to exercise such Lender's rights and enforce the Company's obligations hereunder, including the right to consent to any amendment, supplement, modification or waiver of any provision of this Agreement or any of the other Loan Documents, provided that such participation agreement may provide that such Lender will not agree to any amendment, supplement, modification or waiver described in clauses (i), (ii) or (iii) of the first sentence of Section 9.6 without the consent of the participant. 86 -81- C. The Company shall, at its own cost and expense, provide such certificates, acknowledgments and further assurances in respect of this Agreement and the Bridge Loan as any Lender may reasonably require in connection with any participation, transfer or assignment pursuant to this Section 9.2. D. Nothing in this Agreement shall prevent or prohibit the Lenders from pledging the Bridge Loan and Notes hereunder to a Federal Reserve Bank in support of borrowings made by the Lenders from such Federal Reserve Bank. 9.3. Expenses Whether or not the transactions contemplated hereby shall be consummated, the Company agrees to promptly pay (i) all the actual and reasonable costs and expenses of preparation of the Loan Documents and all the costs of furnishing all opinions by counsel for the Company (including without limitation any opinions requested by the Lenders as to any legal matters arising hereunder), and of the Company's performance of and compliance with all agreements and conditions contained herein on its part to be performed or complied with; (ii) the reasonable fees, expenses and disbursements of counsel to the Agent in connection with the negotiation, preparation, execution and administration of the Loan Documents and the Bridge Loan hereunder, and any amendments, modifications and waivers hereto or thereto and consents to departures from the terms hereof and thereof; and (iii) after the occurrence of an Event of Default, all out-of-pocket costs and expenses (including reasonable attorneys fees and costs of settlement, provided that, unless an impermissible conflict of interest exists as to the joint representation of the Lenders and the Agent, the Company shall pay the reasonable fees of only one law firm to represent both the Lenders and the Agent) incurred by the Lenders or the Agent in enforcing any Obligations of or in collecting any payments due from the Company or under the Notes by reason of such Event of Default or in connection with any refinancing or restructuring of the credit arrangements provided under this Agreement in the nature of a "work-out" or of any insolvency or bankruptcy proceedings. 9.4. Indemnity In addition to the payment of expenses pursuant to Section 9.3, whether or not the transactions contemplated hereby shall be consummated, the Company agrees to indemnify, pay and hold each of the Agent, the Lenders and any holder of any of the Notes, and each of their respective officers, directors, partners, employees, agents, representatives and control persons (collectively called the "Indemnitees"), harmless from and against any and all other liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, 87 -82- expenses and disbursements of any kind or nature whatsoever (including, without limitation, the reasonable fees and disbursements of counsel for such Indemnitees in connection with any investigative, administrative or judicial proceeding commenced or threatened, whether or not such Indemnitee shall be designated as a party thereto, provided that, unless an impermissible conflict of interest exists as to the joint representation of the Indemnitees, the Company shall pay the reasonable fees of only one law firm to represent all of the Indemnitees), that may be suffered by, imposed on, incurred by, or asserted against that Indemnitee, in any manner resulting from, connected with, in respect of, relating to or arising out of this Agreement, the other Loan Documents, the Bridge Commitment Letter, the Lenders' agreements to make the Bridge Loan or the use or intended use of any of the proceeds of the Bridge Loan hereunder or the Acquisition (the "Indemnified Liabilities"); provided that the Company shall have no obligation to an Indemnitee hereunder with respect to Indemnified Liabilities (i) to the extent such liabilities are finally judicially determined to have resulted from (A) the gross negligence or willful misconduct of that Indemnitee or (B) the failure of such Indemnitee to perform its obligations under any Loan Document or (C) such Indemnitee's violation of law or (ii) in connection with the obligations of any Indemnitee under any Loan Document or for any transfer fees. To the extent that the undertaking to indemnify, pay and hold harmless set forth in the preceding sentence may be unenforceable because it is violative of any law or public policy, the Company shall contribute the maximum portion that it is permitted to pay and satisfy under applicable law to the payment and satisfaction of all Indemnified Liabilities incurred by the Indemnitees or any of them. 9.5. Setoff In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, upon the occurrence and during the continuance of any Event of Default, the Lenders, the Agent and any subsequent holder of the Notes is hereby authorized by the Company at any time or from time to time, without notice to the Company, or to any other Person, any such notice being hereby expressly waived, to set off and to appropriate and to apply any and all deposits (general or special, including, but not limited to, Indebtedness evidenced by certificates of deposit, whether matured or unmatured but not including trust accounts, escrow accounts or any other accounts held for the benefit of another Person) and any other Indebtedness at any time held or owing by such Person or any such subsequent holder to or for the credit or the account of the Company against and on account of the obligations and liabilities of the Company to such Person or such subsequent holder under this Agreement and the Notes, including, but not limited to, all claims of any nature or de- 88 -83- scription arising out of or connected with this Agreement or the Notes, irrespective of whether or not (a) such Person or such subsequent holder shall have made any demand hereunder or (b) such Person or such subsequent holder shall have declared the principal of or the interest on its portion of the Bridge Loan and its Notes and other amounts due hereunder to be due and payable as permitted by Section 7 and although said obligations and liabilities, or any of them, may be contingent or unmatured. 9.6. Amendments and Waivers No amendment, modification, termination or waiver of any term or provision of this Agreement or the Notes shall in any event be effective without the prior written concurrence of the Company and the Required Lenders; provided that, notwithstanding the third sentence of Section 9.15, without the prior written consent of each Lenders affected, an amendment, modification, termination or waiver of this Agreement, any Notes, or consent to departure from a term or provision hereof or thereof may not: (i) reduce the principal amount of Notes whose holders must consent to any such amendment, modification, termination, waiver or consent; (ii) reduce the rate of or extend the time for payment of principal or interest on any Notes; (iii) reduce the principal amount of any Notes; (iv) make any Notes payable in money other than that stated in the Notes; (v) make any change in Section 2.4A(iv) or in the definition of Change of Control or in Section 9.6; (vi) make any change in Section 2.4(A)(ii); (vii) reduce the rate or extend the time of payment of fees or other compensation payable to the Lenders hereunder; or (viii) waive performance by the Company of its obligations under, or consent to any departure from any of the terms and provisions of, Section 2.4A(iv); and provided, further, that without the consent of the Agent, no such amendment, modification, termination or waiver may amend, modify, terminate or waive any provision of Section 8 as the same applies to the Agent or any other provision of this Agreement as it relates to the rights or obligations of the Agent. Any waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given. No notice to or demand on the Company in any case shall entitle the Company to any further notice or demand in similar or other circumstances. Any amendment, modification, termination, waiver or consent effected in accordance with this Section 9.6 shall be binding upon each holder of the Notes at the time outstanding, each further holder of the Notes and, if signed by the Company, on the Company. 9.7. Independence of Covenants All covenants hereunder shall be given independent effect so that if a particular action or condition is not per- 89 -84- mitted by any of such covenants, the fact that it would be permitted by an exception to, or be otherwise within the limitation of, another covenant shall not avoid the occurrence of an Event of Default or Potential Event of Default if such action is taken or condition exists. 9.8. Entirety The Loan Documents and the Bridge Commitment Letter together embody the entire agreement of the parties and supersede all prior agreements and understandings, if any, relating to the subject matter hereof and thereof. 9.9. Notices Unless otherwise provided herein, any notice or other communications herein required or permitted to be given shall be in writing and may be personally served, telecopied, telexed or sent by mail and shall be deemed to have been given when delivered in person, upon receipt of telecopy or telex against receipt of answer back or four Business Days after depositing it in the mail, registered or certified, with postage prepaid and properly addressed; provided that notices shall not be effective until received. For the purposes hereof, the addresses of the parties hereto (until notice of a change thereof is delivered as provided in the manner provided above in this Section 9.9) shall be set forth under each party's name on the signature pages hereto. 9.10. Survival of Warranties and Certain Agreements A. All agreements, representations and warranties made herein shall survive the execution and delivery of this Agreement and the Bridge Commitment Letter, the making of the Bridge Loan hereunder and the execution and delivery of the Notes and, notwithstanding the making of the Bridge Loan, the execution and delivery of the Notes or any investigation made by or on behalf of any party, shall continue in full force and effect. The closing of the transactions herein contemplated shall not prejudice any right of one party against any other party in respect of anything done or omitted hereunder or in respect of any right to damages or other remedies. B. Notwithstanding anything in this Agreement or implied by law to the contrary, the agreements of the Company set forth in Sections 9.3, 9.4, 9.14, 9.15, 9.17, 9.19 and 9.21 shall survive the payment of the Bridge Loan and the Notes or Notes, as the case may be, and the termination of this Agreement. 90 -85- 9.11. Failure or Indulgence Not Waiver; Remedies Cumulative To the fullest extent permitted under applicable law, no failure or delay on the part of the Agent or any holder of any Notes in the exercise of any power, right or privilege hereunder or under the Notes shall impair such power, right or privilege or be construed to be a waiver of any default or acquiescence therein, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. To the fullest extent permitted under applicable law, all rights and remedies existing under this Agreement or the Notes are cumulative to and not exclusive of any rights or remedies otherwise available. 9.12. Severability To the fullest extent permitted under applicable law, in case any provision in or obligation under this Agreement or the Notes shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby. 9.13. Headings Section and Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose or be given any substantive effect. 9.14. Applicable Law THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW. 9.15. Successors and Assigns; Subsequent Holders of Notes This Agreement shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the parties hereto and the successors and assigns of the Lenders. The terms and provisions of this Agreement shall inure to the benefit of any assignee or transferee of the Notes pursuant to Section 9.2A, and in the event of such transfer or assignment, the rights and privileges herein conferred upon the Lenders shall automatically extend to and be vested in such transferee or assignee, all subject to 91 -86- the terms and conditions hereof. Except as provided in Section 9.6, in determining whether the holders of a sufficient aggregate principal amount of the Bridge Loan shall have consented to any action under this Agreement, any amount of the Bridge Loan owned or held by the Company or any of its respective Affiliates shall be disregarded. The Company's rights or any interest therein hereunder may not be assigned without the prior express written consent of the Lenders. 9.16. Counterparts; Effectiveness This Agreement and any amendments, waivers, consents or supplements may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument. This Agreement shall become effective upon the execution of a counterpart hereof by each of the parties hereto, and delivery thereof to the Agent or, in the case of the Lenders, written telex or facsimile notice or telephonic notification (confirmed in writing) of such execution and delivery. The Agent will give the Company and the Lenders prompt notice of the effectiveness of this Agreement. 9.17. Consent to Jurisdiction; Venue; Waiver of Jury Trial A. Any legal action or proceeding with respect to this Agreement or the Notes may be brought in the courts of the State of New York or of the United States for the Southern District of New York, and, by execution and delivery of this Agreement, each of the parties to this Agreement hereby irrevocably accepts for itself and in respect of its respective property, generally and unconditionally, the jurisdiction of the aforesaid courts. Each of the parties to this Agreement hereby further irrevocably waives any claim that any such courts lack jurisdiction over such party, and agrees not to plead or claim, in any legal action or proceeding with respect to this Agreement or the Notes brought in any of the aforesaid courts, that any such court lacks jurisdiction over such party. Each of the parties to this Agreement irrevocably consents to the service of process in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to such party, at its respective address for notices pursuant to Section 9.9, such service to become effective 30 days after such mailing. To the extent permitted by law, each of the parties to this Agreement hereby irrevocably waives any objection to such service of process and further irrevocably waives and agrees not to plead or claim in any action or proceeding commenced hereunder or under the Notes that service of process was in any way invalid or ineffective. Nothing herein shall affect the right of any party to this Agreement to serve 92 -87- process in any other manner permitted by law or to commence legal proceedings or otherwise proceed against any party in any other jurisdiction. B. Each of the parties to this Agreement hereby irrevocably waives any objection that it may now or hereafter have to the laying of venue of any of the aforesaid actions or proceedings arising out of or in connection with this Agreement or the Notes brought in the courts referred to in clause A above and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum. C. Each of the parties to this Agreement hereby irrevocably waives all right to a trial by jury in any action, proceeding or counterclaim arising out of or relating to this Agreement or the Notes or the transactions contemplated hereby or thereby. 9.18. Payments Pro Rata A. The Agent agrees that promptly after its receipt of each payment of any interest or premium on or principal of the Notes from or on behalf of the Company, it shall, except as otherwise provided in this Agreement, distribute such payment, where applicable, to the Lenders (other than any Lenders that has consented in writing to waive its pro rata share of such payment) pro rata based upon their respective pro rata shares, if any, of such payment. B. Each Lender agrees that, if it should receive any amount hereunder (whether by voluntary payment, by realization upon security, by the exercise of the right of setoff or banker's lien, by counterclaim or cross action, by the enforcement of any right under the Loan Documents, or otherwise) that is applicable to the payment of the principal of, or interest on, the Bridge Loan of a sum that with respect to the related sum or sums received by other Lenders is in a greater proportion than the total of such Obligation then owed and due to such Lender bears to the total of such Obligation then owed and due to all of the Lenders immediately prior to such receipt, then such Lenders receiving such excess payment shall purchase for cash without recourse or warranty from the other Lenders an interest in the Obligations of the Company to such Lenders in such amount as shall result in a proportional participation by all of the Lenders in such amount; provided that, if all or any portion of such excess amount is thereafter recovered from such Lender, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest. 93 -88- 9.19. Taxes A. Any and all payments by the Company hereunder or under any of the other Loan Documents shall be made free and clear of and without deduction or withholding for any and all present or future Taxes, unless such Taxes are required by law or the administration thereof to be deducted or withheld and excluding (i) in the case of each of the Lenders and the Agent, Taxes imposed on its income, and franchise or similar taxes imposed on it, by (a) any jurisdiction (or political subdivision thereof) of which the Agent or the Lenders, as the case may be, is a citizen or resident or in which the Lenders has a permanent establishment (or is otherwise engaged in the active conduct of its banking businesses through an office or branch) serving as the Lenders' applicable lending office, or (b) the jurisdiction (or any subdivision thereof) in which the Agent or Lenders is organized or (c) any jurisdiction (or political subdivision thereof) in which the Agent or Lenders is doing business, which Taxes are imposed solely as a result of doing business in such jurisdiction, other than a jurisdiction in which a Lender or the Agent is doing business, as a result of a result of a connection arising solely from the activities of the Lender or Agent relating to this Agreement, (ii) in the case of the Lenders and the Agent, any Taxes that are in effect and that would apply to a payment to such Person, as applicable, as of the Closing Date, and (iii) if any Person acquires any interest in this Agreement (a "Transferee"), any Taxes to the extent that they are in effect and would apply to a payment to such Transferee as of the date of the acquisition of such interest, as the case may be (all such nonexcluded Taxes being hereinafter referred to as "Covered Taxes"). If the Company shall be required by Law or the administration thereof to deduct or withhold any Covered Taxes from or in respect of any sum payable hereunder or under any other Loan Document, (a) unless such requirement results from the failure of the payee to perform its obligations under Section 9.19F, the sum payable shall be increased as may be necessary so that after making all required deductions or withholdings (including deductions or withholdings applicable to additional amounts paid under this paragraph), the Lenders receives an amount equal to the sum it would have received if no such deduction or withholding had been made; (b) the Company shall make such deductions or withholdings; and (c) the Company forthwith shall pay the full amount deducted or withheld to the relevant taxation or other authority in accordance with applicable Law. B. The Company agrees to pay forthwith any present or future stamp documentary taxes or any other excise or property taxes, charges or similar levies (all such taxes, charges and levies being herein referred to as "Other Taxes") imposed by any jurisdiction (or any political subdivision or taxing authority thereof or therein) that arise from any payment made by the 94 -89- Company hereunder or under any of the other Loan Documents or from the execution, delivery or registration of, or otherwise with respect to, this Agreement or the other Loan Documents. C. The Company agrees to indemnify the Agent and the Lenders for the full amount of Covered Taxes or Other Taxes not deducted or withheld and paid by the Company in accordance with Sections 9.19A and 9.19B to the relevant taxation or other authority and any Taxes other than Covered Taxes or Other Taxes imposed by any jurisdiction on amounts payable by the Company under this Section 9.19 paid by the Lenders or the Agent and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, whether or not any such Taxes or Other Taxes were correctly or legally asserted. Payment under this indemnification shall be made within 30 days from the date the Agent or the Lenders makes written demand therefor. A certificate as to the amount of such Taxes or Other Taxes and evidence of payment thereof submitted to the Company shall be prima facie evidence, absent manifest error, of the amount due from the Company to the Lenders or such Lenders. D. The Company shall furnish to the Agent and the Lenders the original or a certified copy of a receipt evidencing any payment of Taxes or Other Taxes made by the Company as soon as such receipt becomes available. E. Any Lender claiming any additional amounts payable pursuant to this Section 9.19 shall use reasonable efforts (consistent with legal and regulatory restrictions) to file any certificate or document requested by the Company or the Agent, to change the jurisdiction of its applicable lending office or to contest any tax imposed if the making of such a filing or change or contesting such tax would avoid the need for or reduce the amount of any additional amounts that may thereafter accrue and would not, in the sole determination of such Lenders, be otherwise disadvantageous to such Lenders. F. Each Lender that is not a United States Person (as such term is defined in Section 7701(a)(30) of the Internal Revenue Code) agrees to deliver to the Company and the Agent, on the date of this Agreement or, with respect to any Lender that becomes an assignee or transferee of an interest under this Agreement pursuant to Section 9.2A, on the date of such assignment or transfer to such Lender, (i) two accurate and complete original signed copies of Internal Revenue Service Form 4224 or Form 1001 (or successor forms) certifying to such Lender's entitlement to a complete exemption from United States withholding tax with respect to payments to be made under this Agreement and under any Notes, or (ii) if the Lender is not a "bank" within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code and cannot deliver either Internal Revenue Serv- 95 -90- ice Form 1001 or Form 4224 pursuant to clause (i) above, two accurate and complete original signed copies of Internal Revenue Service Form W-8 (or successor form) certifying to such Lender's entitlement to a complete exemption from United States withholding tax with respect to payments of interest to be made under this Agreement and under any Notes and a certificate (the "Tax Certificate") to the effect that (i) such Lender is not a "bank" for purposes of Section 881(c)(3)(A) of the Code, (ii) such Lender is not a "10-percent shareholder" with respect to the Company for purposes of Section 881(c)(3)(B) of the Code, and (iii) such Lender is not a "controlled foreign corporation" with respect to which the Company is a "related person" for purposes of Section 881(c)(3)(C) of the Code. In addition, the Lenders agree that, when a lapse in time or change in circumstances renders the previous certification obsolete or inaccurate in any material respect (or in the case of a change in law resulting in such obsolesce or inaccuracy, upon the request of the Company), it will deliver to the Company and the Agent two new accurate and complete original signed copies of Internal Revenue Service Form 4224 or Form 1001, or Form W-8 or Tax Certificate, as the case may be, and such other or successor forms or certifications as may be required in order to confirm or establish the entitlement of the Lenders to a continued exemption from or reduction in United States withholding tax with respect to payments under this Agreement and any Notes, or it shall immediately notify the Company and the Agent of its inability to deliver any such Form or Certificate. Subject to Section 9.2A and the immediately succeeding sentence, the Company shall be entitled, to the extent it is required to do so by law, to deduct or withhold income or similar taxes imposed by the United States (or any political subdivision or taxing authority thereof or therein) from interest, fees or other amounts payable hereunder or made on any other Loan Document for the account of any Lenders that is not a United States Person (as such term is defined in Section 7701(a)(30) of the Internal Revenue Code) for U.S. Federal income tax purposes to the extent that the Lenders has not provided to the Company U.S. Internal Revenue Service Forms that establish a complete exemption from such deduction or withholding. Notwithstanding anything to the contrary contained in the preceding sentence or elsewhere in this Section 9.19F and except as set forth in Section 9.2A, the Company agrees to pay additional amounts and to indemnify and hold harmless the Lenders (without regard to the identity of the jurisdiction requiring the deduction or withholding), and reimburse the Lenders upon its written request, in respect of any amounts deducted or withheld by it as described in the immediately preceding sentence as a result of any changes after the date of this Agreement or any assignment or transfer in any applicable law, treaty, governmental rule, regulation, guideline or order, or in the interpretation thereof, relating to the deducting or withholding of income or similar Taxes. 96 -91- G. The provisions of this Section 9.19 shall survive for twelve (12) months after the termination of the Agreement and repayment of all Obligations. 9.20. Waiver of Stay, Extension or Usury Laws The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or other law that would prohibit or forgive it from paying all or any portion of the principal of or interest on the Bridge Loan as contemplated herein, wherever enacted, now or at any time hereafter in force, or that may affect the covenants or the performance of this Agreement; and (to the extent that it may lawfully do so) the Company hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Agent, but will suffer and permit the execution of every such power as though no such law had been enacted. 9.21. Confidentiality The Lenders shall hold all nonpublic information obtained pursuant to the requirements of or in connection with this Agreement that has been identified as confidential by the Company or Chancellor in accordance with the Lenders' customary procedures for handling confidential information of this nature and in accordance with safe and sound banking practices, it being understood and agreed by Chancellor and the Company that (i) in any event the Lenders may make disclosures reasonably required by any bona fide assignee, transferee or participant in connection with the contemplated assignment or transfer by the Lenders of the Bridge Loan or any participation therein (provided that such bona fide assignee, transferee or participant agrees in writing to be bound by the terms of a confidentiality agreement substantially similar to the provisions of this Section 9.21) or as required or requested by any governmental agency or representative thereof or pursuant to legal process; provided that unless specifically prohibited by applicable law or court order, the Lenders shall notify the Company of any request by any governmental agency or representative thereof (other than any such request in connection with any examination of the financial condition of the Lenders by such governmental agency) for disclosure of any such nonpublic information prior to disclosure of such information and (ii) the Lenders may share with any of their Affiliates, and such affiliates may share with the Lenders, any information related to the Company, Chancellor or the Company's or Chancellor's respective Affiliates (including information relating to creditworthiness), the Acquisition or the financing therefor; and provided, further, that in no event shall the Lenders be obli- 97 -92- gated or required to return any materials furnished by the Company or Chancellor. In connection with any sales, assignments or transfers referred to in Section 9.2A, the Lenders shall obtain agreements from the purchasers, assignees or transferees, as the case may be, reasonably satisfactory to the Company, that such parties will comply with this Section 9.21. 9.22. Judgment Currency The Company agrees to indemnify the Agent and the Lenders against any loss incurred by any of them as a result of any judgment or order being given or made for any amount due under this Agreement or any other Loan Document and such judgment or order being expressed and paid in a currency (the "Judgment Currency") other than United States dollars and as a result of any variation as between (i) the rate of exchange at which the United States dollar amount is converted into the Judgment Currency for the purpose of such judgment or order and (ii) the spot rate of exchange in the City of New York at which any such person on the date of payment of such judgment or order is able to purchase United States dollars with the amount of the Judgment Currency actually received by such person. The foregoing indemnity shall continue in full force and effect notwithstanding any such judgment or order as aforesaid. The term "spot rate of exchange" shall include any premiums and costs of exchange payable in connection with the purchase of, or conversion into, United States dollars. 9.23. Replacement of Lenders Under Certain Circumstances. If at time (a) the Borrower becomes obligated to pay additional amounts described in Section 9.19 as a result of any condition described in such section, (b) any Lender becomes insolvent and its assets become subject to a receiver, liquidator, trustee, custodian or other Person having similar powers or (c) any Lender becomes a Defaulting Lender, then the Borrower may, on ten (10) Business Days' prior notice to the Agent and such Lender, replace such Lender by causing such Lender to (and such Lender shall) assign pursuant to Section 9.2 all of its rights and obligations under this Agreement to a Lender or other entity selected by the Borrower and acceptable to the Agent for a purchase price equal to the outstanding principal amount of such Lender's Bridge Loans and all accrued interest and fees and other amounts payable hereunder (including amounts payable under Section 9.4 as though such Bridge Loans were being paid instead of purchased); provided that (i) the Borrower shall have no right to replace the Agent, (ii) neither the Agent nor any Lender shall have any obligation to the Borrower to find a replacement Lender or other such entity, (iii) in the event of a replacement of a Lender to which the Borrower becomes obligated to pay additional amounts pursuant to clause (a) of this Section 9.23, in order for the Borrower to be enti- 98 -93- tled to replace such a Lender, such replacement must take place no later than one-hundred eighty (180) days after the Lender shall have demanded payment of additional amounts under one of the sections described in clause (a) of this Section 9.23, as the case may be, and (iv) in no event shall the Lender hereby replaced be required to pay or surrender to such replacement Lender or other entity any of the fees received by such Lender hereby replaced pursuant to this Agreement. In the case of a replacement of a Lender to which the Borrower becomes obligated to pay additional amounts pursuant to clause (a) of this Section 9.23, the Borrower shall pay such additional amounts to such Lender prior to such Lender being replaced and the payment of such additional amounts shall be a condition to the replacement of such Lender. The Borrower's right to replace a Defaulting Lender pursuant to this Section 9.23 is, and shall be, in addition to, and not in lieu of, all other rights and remedies available to the Borrower against such Defaulting Lender under this Agreement, at law, in equity or by statute. 99 WITNESS the due execution hereof by the respective duly authorized officers of the undersigned as of the date first written above. BORROWER: CHANCELLOR BROADCASTING COMPANY By: /s/ J. D. KERREST ---------------------------------------------- Name: J. D. Kerrest Title: Notice Address: 12655 North Central Expressway Suite 405 Dallas, Texas 75243 Attention: CEO Telephone: (972) 239-6220 Telecopy: (972) 239-0220 with a copy (which shall not constitute notice) to: Hicks, Muse, Tate & Furst Incorporated 200 Crescent Court, Suite 1600 Dallas, Texas 75201 Attention: Lawrence D. Stuart, Jr. Telephone: (214) 740-7300 Telecopy: (214) 740-7313 100 AGENT: BANKERS TRUST NEW YORK CORPORATION, as agent By: /s/ BRUCE D. CLASSON ---------------------------------------------- Name: BRUCE D. CLASSON Title: Senior Vice President Notice Address: One Bankers Trust Plaza 130 Liberty Plaza New York, New York 10006 Attention: Telephone: (212) Telecopy: (212) 101 LENDERS: Commitment: $70,000,000 BANKERS TRUST NEW YORK CORPORATION By: /s/ BRUCE D. CLASSON ------------------------------------------------------- Name: Bruce D. Classon Title: Senior Vice President Commitment: $25,000,000 BANQUE PARIBAS By: /s/ THOMAS G. BRANDT ------------------------------------------------------- Name: Thomas G. Brandt Title: Vice President By: /s/ JOHN G. ACKER ------------------------------------------------------- Name: John G. Acker Title: Group Vice President Commitment: $25,000,000 NATIONSBANK OF TEXAS, N.A. By: /s/ JENNIFER ZYDNEY ------------------------------------------------------- Name: Jennifer Zydney Title: Vice President Commitment: $25,000,000 TORONTO DOMINION (TEXAS), INC. By: /s/ DARLENE RIEDEL ------------------------------------------------------- Name: Darlene Riedel Title: Vice President Commitment: $25,000,000 GOLDMAN SACHS CREDIT PARTNERS L.P. By: /s/ EDWARD C. FORST ------------------------------------------------------- Name: Edward C. Forst Title: Authorized Signatory
102 CHANCELLOR BROADCASTING COMPANY SCHEDULES AND EXHIBITS TO SENIOR CREDIT AGREEMENT 103 SCHEDULE A EXISTING LIENS 104 SCHEDULE B INVESTMENTS 105 SCHEDULE C INTELLECTUAL PROPERTY 106 SCHEDULE D ENVIRONMENTAL MATTERS 107 SCHEDULE E PERMITS 108 SCHEDULE F EXISTING INDEBTEDNESS 109 EXHIBIT I [FORM OF BRIDGE NOTE] CHANCELLOR BROADCASTING COMPANY SENIOR PROMISSORY NOTE New York, New York [Date] $___________ FOR VALUE RECEIVED, Chancellor Broadcasting Company, a corporation for med under the laws of the State of Delaware (the "Borrower"), promises to pay to the order of ("Payee"), on the earlier of (i) the consummation of the Evergreen Merger and (ii) July 2, 1999, Dollars ($ ). The Borrower also promises to pay interest on the unpaid principal amount hereof from the date hereof until paid in full at the rates and at the times that shall be determined in accordance with the provisions of the Senior Credit Agreement dated as of June 26, 1997, as the same may at any time be amended, modified or supplemented and in effect (the "Credit Agreement") among the Borrower, the Lenders named therein and Bankers Trust New York Corporation, as Agent. This Note is issued pursuant to and entitled to the benefits of the Credit Agreement to which reference is hereby made for a more complete statement of the terms and conditions under which the Bridge Loan evidenced hereby was made and is to be repaid. Capitalized terms used herein without definition shall have the meanings set forth in the Credit Agreement. All payments of principal and interest in respect of this Note shall be made in lawful money of the United States of America in same day funds to Payee at the office of Bankers Trust New York Corporation located at 130 Liberty Street, New York, New York 10006, or at such other place as shall be designated in writing for such purposes in accordance with the terms of the Credit Agreement. Each of Payee and any subsequent holder of this Note agrees, by its acceptance hereof, that before disposing of this Note or any part hereof it will make a notation hereon of all principal payments previously made here- 110 -2- under and of the date to which interest hereon has been paid; provided, however, that the failure to make a notation of any payment made on this Note shall not limit or otherwise affect the obligation of the Borrower hereunder with respect to payments of principal or interest on this Note. Whenever any payment on this Note shall be stated to be due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and such extension of time shall be included in the computation of the payment of interest on this Notes. This Note is subject to mandatory prepayment as provided in subsection 2.4A(ii) of the Credit Agreement and prepayment at the option of the Borrower as provided in subsection 2.4A(i) of the Credit Agreement. THE CREDIT AGREEMENT AND THIS NOTE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW. Upon the occurrence of an Event of Default, the unpaid balance of the principal amount of this Note, together with all accrued and unpaid interest thereon, may become, or may be declared to be, due and payable in the manner, upon the conditions and with the effect provided for in the Credit Agreement. The terms of this Note are subject to amendment only in the manner provided for in the Credit Agreement. No reference herein to the Credit Agreement and no provision of this Note or the Credit Agreement shall alter or impair the obligation of the Borrower, which is absolute and unconditional, to pay the principal of and interest on this Note at the place, at the respective times and in the currency herein prescribed. The Borrower promises to pay all out-of-pocket costs and expenses, including reasonable attorneys' fees, all as provided in Section 9.3(iii) of the Credit Agreement, incurred in the collection and enforcement of this Note. The Borrower and endorsers of this Notes hereby waive diligence, presentment, protest, demand and notice of every kind and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder. 111 -3- IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by its duly authorized officer, as of the day and year and at the place first above written. CHANCELLOR BROADCASTING COMPANY By: ------------------------------------- Name: Title: 112 TRANSACTIONS ON NOTE
Amount of Outstanding Principal Principal Paid Balance Notation Date This Date This Date Made By - ---- --------- ----------- -------
113 OPTION OF HOLDER TO ELECT PURCHASE If you wish to elect to have this Bridge Note purchased by the Borrower pursuant to Section 2.4A(iv) of the Credit Agreement (which relates to a Change of Control), check the box: [ ] If you wish to elect to have only part of this Bridge Note purchased by the Borrower pursuant to Section 2.4A(iv) of the Credit Agreement, state the amount: $[ ] Date: Your Signature: -------- ----------------------------------------------- (Sign exactly as your name appears on the other side of this Notes) Signature Guarantee: ----------------------------------------------------------- 114 EXHIBIT II FORM OF COMPLIANCE CERTIFICATE THE UNDERSIGNED HEREBY CERTIFY ON BEHALF OF CHANCELLOR BROADCASTING COMPANY (AND NOT INDIVIDUALLY) THAT: (i) We are the duly elected [Title] and [Title] of Chancellor Broadcasting Company, a corporation formed under the laws of the State of Delaware (the "Borrower"); (ii) We have reviewed the terms of the Senior Credit Agreement dated as of , 1997, by and among the Borrower, the Lenders named therein and Bankers Trust New York Corporation, as Agent (the "Credit Agreement"), and the terms of the Notes, and we have made, or have caused to be made, under our supervision, a review in reasonable detail of the transactions and condition of the Borrower and its Subsidiaries during the accounting period covered by the attached financial statements; and (iii) We have no knowledge of the existence of any condition or event that would suggest the failure of the Borrower's full and timely performance of all covenants contained in Sections 6.1, 6.2, 6.3, 6.4, 6.5, 6.8 and 6.11 of the Credit Agreement during or at the end of the accounting period covered by the attached financial statements or as of the date of this Compliance Certificate, except as set forth below. Described in a separate attachment to this Compliance Certificate are the exceptions, if any, to paragraph (iii), listing, in detail, the nature of the condition or event, the period during which it has existed and the action that the Borrower has taken, is taking, or proposes to take with respect to each such condition or event. The foregoing certifications together with the attached [TO BE PREPARED BY THE BORROWER] financial statements delivered with this Compliance Certificate in support hereof, are made and delivered this [ ] day of [ ], [ ], pursuant to Section 5.1(iii) of the Credit Agreement. Capitalized terms used 115 -2- herein shall have the meanings set forth in the Credit Agreement. CHANCELLOR BROADCASTING COMPANY By: -------------------------------------- Name: Title: By: -------------------------------------- Name: Title: 116 EXHIBIT III FORM OF NOTICE OF BORROWING Bankers Trust New York Corporation as Agent 130 Liberty Street New York, New York 10006 Attention: Ladies and Gentlemen: The undersigned, Chancellor Broadcasting Company (the "Borrower"), refers to the Senior Credit Agreement dated as of June 26, 1997, as amended, supplemented or restated from time to time (the "Credit Agreement," the terms defined therein being used herein as therein defined) by and among the Borrower, the Lenders named therein and Bankers Trust New York Corporation, as Agent, and hereby gives you notice pursuant to Section 2.1B of the Credit Agreement that the Borrower wishes to borrow under Section 2.1 of the Credit Agreement and, in that connection, sets forth below the information relating to such borrowing (the "Proposed Borrowing") as required by Section 2.1B of the Credit Agreement: (i) The date of the Proposed Borrowing, being a Business Day, is , 1997. (ii) The aggregate amount of the Proposed Borrowing is $170,000,000. Yours truly, CHANCELLOR BROADCASTING COMPANY By: ------------------------------------------- Name: Title: 117 EXHIBIT IV FORM OF OPINION OF WEIL, GOTSHAL & MANGES LLP 118 [Form of Opinion of Weil, Gotshal & Manges LLP] , 1997 Bankers Trust New York Corporation, Agent One Bankers Trust Plaza, 14th Floor New York, New York 10006 And the Lenders under the Credit Agreement referred to below Re: Senior Credit Agreement Ladies and Gentlemen: This opinion is furnished to you pursuant to Section 3.1(A)(7) of the Credit Agreement (as hereinafter defined). We have acted as counsel to Chancellor Broadcasting Company, a corporation formed under the laws of the State of Delaware (the "Borrower"), in connection with the Senior Credit Agreement, dated as of , 1997 (the "Credit Agreement"), by and among the Borrower, the Lenders signatory thereto and Bankers Trust New York Corporation, as Agent for the Lenders (in such capacity, the "Agent"). Unless otherwise indicated, capitalized terms used and not otherwise defined herein have the meanings set forth in the Credit Agreement. We have reviewed the following documents (with such documents herein collectively referred to as the "Loan Documents"): (a) an executed copy of the Credit Agreement and the exhibits and schedules thereto and (b) the executed Notes. In rendering the opinion set forth herein, we have assumed, with your permission and without verification, (i) the due authorization, execution and delivery of the Loan Documents by all parties to such Loan Documents other than the Borrower and that each such Document is valid, binding and enforceable against the parties thereto other than the Borrower, (ii) the legal capacity of natural persons, (iii) the genuineness of all signatures, (iv) the authenticity of all documents submitted to us as originals and (v) the conformity to original documents of all documents submitted to us as copies. As to various questions of fact material to our opinion, we have relied upon the representations made in the Loan Documents and upon certificates of officers of the Borrower. 119 -2- In addition, we have examined originals, or copies certified or otherwise identified to our satisfaction, of such corporate records, agreements, documents or other instruments, as applicable, and of certificates or comparable documents or instruments of public officials and other instruments and documents and such examination of federal law, the law of the State of New York and the Delaware General Corporation Law as we have deemed relevant and necessary to form the basis for the opinions hereinafter set forth. We express no opinion on any matters under the law of any jurisdiction other than the federal law of the United States of America, the law of the State of New York and the Delaware General Corporation Law. Based upon the foregoing, and subject to the further qualifications, limitations, exceptions and assumptions herein set forth, we are of the opinion that: 1. The Borrower (i) is a duly incorporated and validly existing corporation formed under the laws of the State of Delaware, and (ii) has the corporate power to conduct its business as now conducted and to own, or hold under lease, its assets and to enter into each of the Loan Documents and to perform its obligations thereunder. 2. The execution, delivery and performance (in accordance with the terms thereof) by the Borrower of each of the Loan Documents to which it is a party has been duly authorized by all necessary corporate action of the Borrower. 3. Each of the Loan Documents to which the Borrower is a party has been duly executed and delivered by the Borrower and constitutes the legally valid and binding obligation of the Borrower, and each of the Loan Documents is enforceable against the Borrower in accordance with its terms. 4. The execution and delivery of the Loan Documents to which the Borrower is a party by the Borrower, the making of the Bridge Loan evidenced by the Notes and the application of the proceeds therefrom as provided in the Credit Agreement, and the performance by the Borrower of its obligations under the Loan Documents to which it is a party, do not: (a) violate any statute, rule or regulation applicable to the Borrower under the laws of the State of New York or the federal laws of the United States (including, without limitation, Regulations G, T, U or X of the Board of Governors of the Federal Reserve System); (b) contravene or violate the charter or articles and 120 -3- memorandum of association of the Borrower; (c) conflict with or result in the breach of or a default under any of the Borrower's material contracts or court orders to which the Borrower is subject or by which it or any of its properties are bound; or (d) to our knowledge, result in or require the creation or imposition of a Lien upon or with respect to any of the properties of the Borrower, except, in the case of (a), (b), (c) or (d) above, where such violation, conflict, default or creation or imposition of any Lien would not have, individually or in the aggregate, a Material Adverse Effect. 5. The Borrower is not an "investment company" or a company "controlled by" an "investment company" as such terms are defined in the Investment Company Act of 1940, as amended. 6. To our knowledge, no consent, authorization, order, registration approval, action by, or filing with, any governmental or public body pursuant to the laws of the State of New York, the Delaware General Corporation Law, or the federal laws of the United States is required to be obtained or made by the Borrower in connection with the making of the Bridge Loan except for (i) such consents, authorizations, approvals, orders, registrations or filings as have been made or obtained on or prior to the date hereof, or as permitted to be made or obtained after the date hereof pursuant to the Credit Agreement and (ii) such consents, authorizations, approvals, orders, registrations or filings as could not reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect. 7. It is not necessary in connection with the execution and delivery of the Notes to register the Notes under the Securities Act of 1933, as amended (the "Act"), or to qualify an indenture with respect thereto under the Trust Indenture Act of 1939, as amended. 8. To our knowledge, there is no action, suit, investigation, litigation or proceeding affecting the Borrower or any of its Subsidiaries or any of their respective properties or assets pending or threatened before any court, governmental agency or arbitrator not disclosed in such officer's certificate (a) that can reasonably be expected to have a Material Adverse Effect, or (b) that seeks to restrain, enjoin, prevent the consummation of or otherwise challenge the Acquisition, any of the Loan Documents or the other transactions contemplated thereby. 121 -4- Our opinions set forth above are subject in all respects to the following qualifications, limitations, exceptions and assumptions. (a) The opinions set forth above are subject, as to enforceability, to the effect of (i) any applicable bankruptcy (including, without limitation, preference and fraudulent conveyance), insolvency, reorganization, moratorium or similar laws affecting creditor's right generally, and (ii) general principles of equity (regardless of whether considered in proceedings in equity or at law), including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, and the possible unavailability of specific performance or injunctive relief. (b) We express no opinion with respect to the following provisions to the extent that the same are contained in the Loan Documents: (i) provisions purporting to waive rights to notices, objections, demands, legal defenses, statutes of limitations, rights to trial by jury, or other benefits or rights that cannot be waived under applicable law; (ii) provisions purporting to affect the jurisdiction or venue of courts; (iii) provisions releasing, exculpating or exempting a party from, or requiring indemnification of a party for, liability for its own action or inaction, to the extent that the same are inconsistent with public policy; and (iv) provisions that decisions by a party are conclusive. (c) As to matters with respect to which our opinions are stated to be "to our knowledge" or words of similar effect, we have not undertaken any independent examination of facts, but have based our opinion in reliance upon certificates provided to us by officers of the Borrower and upon matters of which the attorneys in our Firm who have devoted time to this matter have actual current knowledge. (d) We have not been called upon to, and accordingly do not, express any opinion as to the various state and federal laws regulating banks or the conduct of their business that may relate to the Loan Documents or the transaction contemplated thereby. Without limiting the generality of the foregoing, we express no opinion as to the effect of the law of any jurisdiction other than the State of New York wherein any Lenders may be located or where an enforcement of the Loan Documents may be sought that limits the rates of interest legally chargeable or collectible. 122 -5- (e) The opinions expressed herein are as of the date hereof only, and we assume no obligation to update or supplement such opinions to reflect any fact or circumstance that may hereafter come to our attention or any change in law that hereafter occur or become effective. This opinion is being delivered upon the express instructions of the Borrower to the Agent and the Lenders, and is solely for their benefit in connection with the above transactions. This opinion may not be relied upon for any other purpose, or relied upon by any other person, firm or corporation for any purpose, without our prior written consent. Notwithstanding the immediately preceding sentence, this opinion may be relied upon by any assignee of all or a portion of the Bridge Loan as if it were addressed and had been delivered to them on the date hereof. The Agent and the Lenders may provide a copy of this opinion, for informational purposes only, to bank examiners and other regulatory authorities should they so request, or to their respective independent auditors and attorneys, or pursuant to order or legal process of any court or governmental agency. Very truly yours, 123 EXHIBIT V FORM OF OPINION OF CAHILL GORDON & REINDEL 124 EXHIBIT VI CHANCELLOR BROADCASTING COMPANY OFFICERS' CERTIFICATE , 1997 BANKERS TRUST NEW YORK CORPORATION One Bankers Trust Plaza 130 Liberty Street New York, New York 10006 Ladies and Gentlemen: Referring to Sections 3.1(H) and 3.1(L) of the Senior Credit Agreement dated as of , 1997 (the "Credit Agreement"), by and among Chancellor Broadcasting Company (the "Borrower"), the Lenders named therein and Bankers Trust New York Corporation, as Agent, the undersigned duly elected, qualified and acting officers of the Borrower certify on behalf of the Borrower (and not individually) that: (i) the representations and warranties in Section 4 of the Credit Agreement are true, correct and complete in all material respects on and as of the date hereof to the same extent as though made on and as of this date except for those representations and warranties which relate to a specific date, which shall be true, correct and complete as of such date; (ii) the Borrower and its Subsidiaries have performed and complied in all material respects with all covenants and conditions contained in the Credit Agreement to be performed and observed by the Borrower or its Subsidiaries on or prior to the date hereof; (iii) all conditions to the consummation of the Acquisition and the Bank Financing set forth in the Acquisition Agreement and the Bank Financing Documents, as the case may be, have been satisfied substantially on the terms set forth therein and have not been waived or amended without the Agent's prior written consent; and 125 -2- (iv) there is not pending or, to my knowledge and the knowledge of the Borrower, threatened any action, suit, proceeding, governmental investigation or arbitration against or affecting the Borrower or its Subsidiaries or any property or asset of the Borrower or its Subsidiaries that is likely to result in a Material Adverse Effect, that has not been disclosed by the Borrower in writing to the Agent. All capitalized terms not so defined herein have the meanings ascribed to them in the Credit Agreement. 126 -3- The undersigned have read all conditions, and all definitions and provisions relating to such conditions, contained in the Credit Agreement, and have made or have caused to be made such examinations or investigations necessary to enable the undersigned to express the foregoing opinions. Very truly yours, CHANCELLOR BROADCASTING COMPANY By: ------------------------------------------ Name: Title: By: ------------------------------------------ Name: Title: 127 EXHIBIT VII CERTIFICATE OF SECRETARY OF CHANCELLOR BROADCASTING COMPANY I, , Secretary of Chancellor Broadcasting Company, a corporation formed under the laws of the State of Delaware (the "Company"), do hereby certify, on behalf of the Company and on behalf of Chancellor Radio Broadcasting, Inc. ("Chancellor"), (and not individually) that: 1. Attached hereto as Annex A is a true, complete and correct copy of the Company's Certificate of Incorporation, and all amendments thereto, which is in full force and effect as of the date hereof, and no proceedings have been taken to amend, supplement, surrender or cancel the same as of the date hereof. 2. Attached hereto as Annex B is a true, complete and correct copy of Chancellor's Certificate of Incorporation, and all amendments thereto, which is in full force and effect as of the date hereof, and no proceedings have been taken to amend, supplement, surrender or cancel the same as of the date hereof. 3. Attached hereto as Annex C is a true, complete and correct copy of the Company's Bylaws as in effect on the date hereof. 4. Attached hereto as Annex D is a true, complete and correct copy of Chancellor's Bylaws as in effect on the date hereof. 5. Attached hereto as Annex E are full, true and correct copies of resolutions duly adopted by the Board of Directors of the Company on [ ], 1997. Such resolutions are all of the resolutions adopted by the Company that relate to the Transactions (as defined in the Senior Credit Agreement (the "Credit Agreement"), dated as of , 1997, by and among the Borrower, the Lenders named therein and Bankers Trust New York Corporation, as Agent), and such resolutions have not been modified or rescinded since their adoption and are in full force and effect as of the date hereof. 6. There are no proceedings pending, or, to the best of the knowledge of the undersigned, threatened or contem- 128 -2- plated, for the merger, liquidation, dissolution or sale of all or substantially all of the assets of the Company or any Subsidiary, or that would otherwise threaten the Company's corporate existence other than as described in the Credit Agreement. 7. Each person who, as a director or officer of the Company or any Subsidiary, executed and delivered the Credit Agreement, the Notes and each other document or instrument executed in connection therewith, was duly elected or appointed, qualified and acting as such director or officer at the respective times of such signing and delivery and the signatures of such persons appearing on such documents are their genuine signatures. Dated: , 1997 By: ------------------------------------------ Name: Title: Secretary I, , Vice President of the Company, do hereby certify on behalf of the Company (and not individually) that is the duly elected, qualified and acting Secretary of the Company and that the signature of set forth above is his genuine signature. Dated: , 1997 By: ------------------------------------------ Name: Title: Vice President -----END PRIVACY-ENHANCED MESSAGE-----