EX-10.11(a)
Revolving Credit Agreement
REVOLVING CREDIT AGREEMENT
dated as of
December 30, 1997
By and Among
NB, II, INC.; NORTHLAND BROADCASTING, LLC; READING RADIO, INC.;
CENTRAL MISSOURI BROADCASTING, INC.; CMB II, INC.; NORTHERN COLORADO
RADIO, INC.; NCR II, INC.; TRI-STATE BROADCASTING, INC.; CENTRAL
MICHIGAN NEWSPAPERS, INC.; GRAPH ADS PRINTING, INC.; GLADWIN
NEWSPAPERS, INC.; CADILLAC NEWSPAPERS, INC.; MIDLAND BUYER'S GUIDE,
INC.; CMN ASSOCIATED PUBLICATIONS, INC.; CENTRAL MICHIGAN
DISTRIBUTION CO., INC.; CENTRAL MICHIGAN DISTRIBUTION CO., L.P.;
▇▇▇▇▇ NESPAPERS, INC.; ▇▇▇▇▇ RADIO, INC.; HURON HOLDINGS, LLC;
NORTHERN COLORADO HOLDINGS, LLC; NCR III, LLC; NORTHLAND HOLDINGS,
LLC, CMN HOLDINGS, INC.; NCH II, LLC; ST. ▇▇▇▇▇ NEWSPAPERS, INC.;
HURON NEWSPAPERS, LLC; and HURON P.S., LLC
("Borrowers")
and
BMC HOLDINGS, LLC
a Virginia Limited Liability Company
("Lender")
REVOLVING CREDIT AGREEMENT
This REVOLVING CREDIT AGREEMENT is dated as of December 30, 1997, and is
entered into by and among the following parties:
Northland Broadcasting, LLC ("Northland"); Reading Radio, Inc.
("Reading"); Central Missouri Broadcasting, Inc. ("CMB"); Northern Colorado
Radio, Inc. ("NCR"); Tri-State Broadcasting, Inc. (Tri-State"); CMB II, Inc.
("CMB II"); ▇▇ ▇▇, Inc. ("▇▇ ▇▇"); Central Michigan Newspapers, Inc. ("CMN");
Graph Ads Printing, Inc. ("Graph Ads"); Gladwin Newspapers, Inc. ("Gladwin");
Cadillac Newspapers, Inc. ("Cadillac"); Midland Buyer's Guide, Inc. ("MBG"); CMN
Associated Publications, Inc. ("CMN Assoc."); Central Michigan Distribution,
Inc. ("CMD"); Central Michigan Distribution Co., L.P. ("CMD L.P."); ▇▇▇▇▇
Newspapers, Inc. ("BNI"); ▇▇▇▇▇ Radio, Inc. ("BRI"); Huron Holdings, LLC ("HH
LLC"); Northern Colorado Holdings, LLC ("NCH LLC"); NCR III, LLC ("NCR III");
Northland Holdings, LLC ("NH LLC"); CMN Holdings, Inc. ("CMNH"); NCH II, LLC
("NCH II"); St. ▇▇▇▇▇ Newspapers, Inc. ("St. ▇▇▇▇▇"); NCR II, Inc. ("NCR II");
Huron Newspapers, LLC ("Huron Newspapers"); and Huron P.S., LLC ("HPS"); (all of
the entities identified in this section shall be referred to individually
sometimes as a "Borrower" and collectively as "Borrowers"), as borrowers; and
BMC Holdings, LLC, a Virginia limited liability company (hereinafter "Lender")
as the lender.
RECITALS
(Capitalized terms used herein are defined below.)
Lender has agreed to extend a line of credit in favor of the Borrowers,
jointly and severally, in the maximum principal amount of $108,000,000.00 (the
"Credit Facility"), to be borrowed and reborrowed by the Borrowers, jointly and
severally, upon the terms hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing, and the covenants
contained herein, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATIONS
SECTION 1.1 Definitions. The following terms, as used herein, shall have
the following meanings:
"Additional Advance" and "Additional Advances" shall have the meaning set
forth in Section 2.1 hereof.
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"Advances" means collectively the Closing Date Advances and the Additional
Advances.
"Agreement" means this Revolving Credit Agreement, together with any
concurrent or subsequent rider, amendment, modification, schedule or exhibit to
this Revolving Credit Agreement.
"Bankruptcy Code" means Title 11 of the United States Code entitled "The
Bankruptcy Code," as amended or supplemented from time to time, or any successor
statute, and any and all rules and regulations issued or promulgated in
connection therewith.
"Borrower" or "Borrowers" means individually or collectively the Borrowers
described in the introduction to this Agreement and any other Person that
becomes a Borrower by executing this Agreement.
"▇▇▇▇▇" means ▇▇▇▇ ▇. ▇▇▇▇▇ of Evansville, Indiana.
"▇▇▇▇▇ Media" means ▇▇▇▇▇ Media Company, LLC.
"Business Day" means any day other than a Saturday, a Sunday, or a day on
which commercial lenders in the City of New York, New York, are authorized or
required by law or executive order or decree to close.
"Closing" shall have the meaning set forth in Section 3.1 hereof.
"Closing Date" means December 30, 1997.
"Closing Date Advance" and "Closing Date Advances" shall have the
respective meanings set forth in Section 2.2 hereof.
"Credit Document(s)" means each of the following documents, instruments,
and agreements individually or collectively, as the context requires: (a) this
Agreement; (b) the Revolving Credit Note; (c) the Indenture; and (d) such other
documents, instruments, and agreements as Lender may reasonably request in
connection with any transaction contemplated hereunder.
"Cure Period" shall mean the thirty (30) day period immediately following
the occurrence of an Event of Default.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Default Rate" means the fixed rate of interest of fifteen percent (15%)
per annum.
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"Dollars" or "$" means lawful currency of the United States of America.
"Event(s) of Default" shall have the meanings set forth in Section 7.1
hereof.
"FCC" means the Federal Communications Commission or any Governmental
authority succeeding to any of its functions.
"FCC Licenses" means all commercial broadcast station licenses, permits
and other certificates required by (A) the FCC, (B) the Communications Act of
1934, as amended, (C) 47 CFR Part 73, or (D) any other governmental entity in
connection with the ownership and operation of each of the Radio Stations and
granted or assigned to the Borrowers by the FCC or any other public or
governmental agency or regulatory body for the operation of said Radio Stations.
"Final FCC Order" means an order, action or decision of the FCC (or
subsequent court order or judgment) that (A) has not been reversed, stayed,
enjoined, modified or amended and as to which the time for appeal, petition for
certiorari, to seek reargument, rehearing, administrative reconsideration or
review has expired; and (B) as to which no appeal, reargument, petition for
certiorari, rehearing, petition for reconsideration or application for review is
pending; or (C) as to which any right to appeal, reargue, petition for
certiorari, rehearing, reconsideration or review has been sought, the order or
judgment of the court or FCC has been (1) affirmed by the highest court (or
administrative entity or body) to which the order was appealed or from which the
argument, rehearing, reconsideration or review was sought, or (2) certiorari has
been denied, and (3) the time to take any further appeal or to seek certiorari
or further reargument, rehearing, reconsideration or review has expired.
"Financial Statement(s)" means, with respect to any accounting period of
any Person, statements of income and statements of changes in financial position
of such Person for such period, and balance sheets of such Person as of the end
of such period, setting forth in each case in comparative form figures for the
corresponding period in the preceding Fiscal Year, or, if such period is a full
Fiscal Year, corresponding figures from the preceding annual audit, all prepared
in reasonable detail and in accordance with GAAP where appropriate. "Financial
Statement(s)" shall include the notes and schedules thereto.
"Fiscal Year" means, for each Borrower, the time period from and including
March 1 through the last day of the following February.
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"Funding Borrower" shall have the meaning set forth in Section 2.9(b)
hereof.
"Fiscal Year End" means, for each Borrower, the last day of February.
"GAAP" means generally accepted accounting principles in the United States
of America, consistently applied, which are in effect as of the date of their
application.
"Guaranty" means the Borrowers' joint and several guaranty of payment of
the Media Notes.
"Indenture" means that certain Trust Indenture entered into by and among
▇▇▇▇▇ Media and ▇▇▇▇▇ Media Management, Inc. (collectively as the "Issuer"), and
U.S. Trust Company as "Trustee" dated December 30, 1997, in which each present
Borrower is identified as a "Restricted Subsidiary".
"Initial Interest Rate" means the fixed rate of interest of 7.292% per
annum until December 15, 1999 and thereafter at the rate of 11.6666% per annum
during any period that the unpaid principal balance of the Note exceeds $105
million and 12.0% per annum during any period that the unpaid principal balance
of the Note is $105 million or less.
"Insolvency Proceeding" means any proceeding commenced by or against any
Person, under any provision of the Bankruptcy Code, or under any other
bankruptcy or insolvency law, including, but not limited to, assignments for the
benefit of creditors, formal or informal moratoriums, compositions, or
extensions with some or all creditors.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
supplemented and amended from time to time, or any successor statute, and any
and all regulations and rules promulgated thereunder.
"Lender" means only BMC Holdings, LLC, a Virginia limited liability
company.
"Lending Office" means Lender's office located at the address set forth in
Section 8.1 or such other office of Lender as it may hereafter designate as its
Lending Office by notice to the Borrowers.
"Licenses" means all FCC Licenses.
"Loan" at any time means, collectively, the aggregate amount of all
Advances hereunder then outstanding.
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"Material Adverse Effect" means any material adverse change in (a) the
financial condition of the Borrowers taken as a whole, (b) the ability of the
Borrowers taken as a whole to perform the Obligations under the Credit Documents
(including, without limitation, repayment of the Obligations as they come due),
or (c) other than as the result of some action or inaction by Lender, the
validity or enforceability of this Agreement, the other Credit Documents, or the
rights or remedies of Lender hereunder and thereunder.
"Maturity Date" means the earlier of December 15, 2007, or the maturity of
the Media Notes according to their terms, or such earlier date to which the
maturity of the Loan may be accelerated as provided herein.
"Media Notes" mean the notes issued by ▇▇▇▇▇ Media and ▇▇▇▇▇ Media
Management, Inc. as co-issuers pursuant to the Indenture, the payment of which
is guaranteed by the Borrowers.
"Newspaper Operators" means, collectively, CMN, Graph Ads, Gladwin,
Cadillac, MBG, CMN Assoc., CMD Inc., CMD L.P., St. ▇▇▇▇▇, Huron Newspapers, HPS
and any other Borrower that operates or owns or controls any Newspaper from time
to time.
"Newspapers" means, collectively, the Morning Sun; Mt. Pleasant Buyers
Guide; Clare County Buyers Guide; ▇▇▇▇ Reminder; Gladwin Buyers Guide; ▇▇▇▇▇▇▇▇
County Herald; Cadillac Buyers Guide; Midland Buyers Guide; ▇▇▇▇▇▇ City
Reminder; Edmore Advertiser; Hemlock Shoppers Guide; St. ▇▇▇▇▇ Reminder; The
Northeastern Shopper Guides; and any other newspaper, periodical, tabloid,
magazine or other publication business owned and operated by any Borrower from
time to time, and "Newspaper" shall mean any one of the Newspapers.
"Obligations" means any and all indebtedness, liabilities, and obligations
of the Borrowers or any of them owing to Lender, arising out of or in connection
with this Agreement or any other Credit Document, previously, now, or hereafter
incurred, and howsoever evidenced, whether direct or indirect, absolute or
contingent, joint or several, liquidated or unliquidated, voluntary or
involuntary, due or not due, legal or equitable, whether incurred before,
during, or after any Insolvency Proceeding, and whether recovery thereof is or
becomes otherwise unenforceable or unallowable as claims in any Insolvency
Proceeding, together with all interest thereupon (including all interest
accruing during the pendency of an Insolvency Proceeding), including without
limitation all principal and interest owing under the Revolving Credit Note and
any other fees and expenses due hereunder, and all other indebtedness evidenced
by the Credit Documents.
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"Person" means and includes natural persons, corporations, limited
partnerships, general partnerships, joint stock companies, joint ventures,
associations, companies, trusts, lenders, trust companies, land trusts, business
trusts, or other organizations, irrespective of whether they are legal entities,
and governments and agencies and political subdivisions thereof.
"Post-Closing Lender Expenses" means all reasonable costs or expenses paid
or advanced by Lenders which are required to be paid by the Borrowers under this
Agreement and all other documents executed in connection herewith on or after
the Closing Date, including without limitation all costs or expenses paid or
advanced by Lenders in connection with any Advances, including without
limitation, all recording fees, taxes, and any other fees and costs incurred in
connection with the funding of any Advances pursuant to Section 2.7 and Section
3.2; all taxes and insurance premiums of every nature and kind of the Borrowers
paid by Lenders; all amounts advanced by Lenders to cure defaults under
Permitted Debt; reasonable and customary appraisal, filing, recording,
documentation, publication and search fees paid or actually incurred by Lenders
to correct any default or enforce any provision of this Agreement and all other
Credit Documents executed in connection herewith on or after the Closing Date;
reasonable costs and expenses of suits or arbitration proceedings incurred by
Lenders in enforcing or defending this Agreement, or any portion hereof, and
reasonable attorneys' fees and expenses incurred by Lenders in amending,
terminating, enforcing, defending or taking other action concerning this
Agreement or any other Credit Documents or any other documents executed in
connection herewith, whether or not suit is brought, such attorneys' fees to
include the reasonable estimate of the allocated costs and expense of Lenders'
in-house legal counsel and professional staff. All Post-Closing Lender Expenses
paid or incurred by Lenders are payable upon demand, and if not reimbursed
within thirty (30) days after demand, shall become a part of the Obligations and
shall immediately thereafter bear interest, together with all other amounts to
be paid by the Borrowers pursuant hereto, at the appropriate interest rate in
accordance with the provisions of Section 2.3 hereof.
"Radio Operators" means, collectively, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇, ▇▇▇,
▇▇▇-▇▇▇▇▇, ▇▇▇ ▇▇, ▇▇ ▇▇, and NCR II, and any other Borrower that operates, owns
or controls any Radio Station from time to time.
"Radio Stations" means each of the broadcast radio stations presently
owned and operated by any of the Borrowers and any other broadcast radio station
hereafter owned or operated by any Borrower, and the Licenses with respect
thereto. "Radio Station" means any one of the Radio Stations.
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"Revolving Credit Note" or the "Note" means that certain Revolving Credit
Note of even date herewith in the principal amount of One Hundred Eight Million
Dollars ($108,000,000.00) executed by the Borrowers to the order of Lender,
together with any amendments thereto or modifications thereof.
SECTION 1.2 Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with GAAP.
SECTION 1.3 Computation of Time Periods. In this Agreement, with respect
to the computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and "until"
each mean "to but excluding." Periods of days referred to in this Agreement
shall be counted in calendar days unless otherwise stated.
SECTION 1.4 Construction. Unless the context of this Agreement clearly
requires otherwise, references to the plural include the singular and to the
singular include the plural, references to any gender include any other gender,
the part includes the whole, the term "including" is not limiting, and the term
"or" has, except where otherwise indicated, the inclusive meaning represented by
the phrase "and/or." The words "hereof," "herein," "hereby," "hereunder," and
similar terms in this Agreement refer to this Agreement as a whole and not to
any particular provision of this Agreement. Article, section, subsection,
clause, exhibit and schedule references are to this Agreement, unless otherwise
specified. Any reference in this Agreement or any of the other Credit Documents
to this Agreement includes any and all permitted alterations, amendments,
changes, extensions, modifications, renewals, or supplements thereto or thereof,
as applicable.
SECTION 1.5 Schedules. All of the schedules attached hereto shall be
deemed incorporated herein by reference.
SECTION 1.6 Independence of Provisions. All agreements and covenants
hereunder, under the other Credit Documents, and the other documents,
instruments, and agreements entered into in connection herewith shall be given
independent effect such that if a particular action or condition is prohibited
by the terms of any such agreement or covenant, the fact that such action or
condition would be permitted within the limitations of another agreement or
covenant shall not be construed as allowing such action to be taken or condition
to exist, except as and to the extent otherwise herein provided.
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ARTICLE II
THE REVOLVING CREDIT
SECTION 2.1 The Loan. Subject to the terms and conditions hereof Lender
hereby agrees to make Advances to the Borrowers as follows:
(a) Closing Date Advances. Lender agrees to lend to the Borrowers on the
Closing Date an amount equal to the sum of the Closing Date Advances as set
forth in Section 2.2.
(b) Additional Advances. Subject to Borrowers' compliance with the
requirements of Section 3.2, from and after the Closing Date, from time to time
from funds available to Lender therefor the Lender shall lend and relend funds
and make additional advances to Borrowers upon the request of Borrowers (the
"Additional Advances"); provided, however, that at any time before December 15,
2007, the principal amount of all Closing Date Advances and Additional Advances
then outstanding shall not exceed the amount set forth in Section 2.2. Any
Additional Advances and any portion of the Closing Date Advances subsequently
repaid or prepaid may be reborrowed as herein provided.
SECTION 2.2 Purpose and Disbursement of Proceeds of Closing Date Advances.
On the Closing Date Advances shall be made to Borrowers in the aggregate amount
of One Hundred Eight Million Dollars ($108,000,000.00) (the "Closing Date
Advances").
SECTION 2.3 Interest Rates. The unpaid principal balance of the Loan shall
bear interest at the applicable rate per annum provided below:
(a) Initial Interest Rate. From and after the Closing Date, interest shall
accrue on the outstanding principal balance of the Loan at the Initial Interest
Rate.
(b) Default Rate. Upon the occurrence and during the continuance of an
Event of Default, interest shall accrue on the then outstanding principal
balance of the Loan at the Default Rate. In the event the Event of Default is
cured within the Cure Period, if applicable, the interest rate on the Loan shall
revert to the Initial Interest Rate effective as of the date the cure is
effectuated. Interest which has accrued on the Obligations at the Default Rate
shall be due and payable with the next required payment hereunder or on demand
as it accrues if after the Maturity Date.
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(c) Computation of Interest. All computations of interest shall be
calculated on the basis of a year of three hundred sixty (360) days for the
actual days elapsed.
SECTION 2.4 Repayment of the Loan. The Borrowers shall repay the Loan as
follows:
(a) Interest Payments. The Borrowers shall pay to Lender semi-annual
interest payments in arrears on the aggregate outstanding principal balance of
the Note, to include all interest then due and accrued at the Initial Interest
Rate, on the first day of each June and December, commencing June 15, 1998, and
each June and December thereafter continuing to the Maturity Date when all then
outstanding Obligations shall be due and payable, unless sooner repaid. All
interest due at the Default Rate shall be paid in accordance with Section 2.3(b)
hereof.
(b) Payment of Principal and Remaining Obligations. Except as otherwise
set forth herein, all principal amounts outstanding under the Note and all other
Obligations shall be due and payable in full on the Maturity Date.
SECTION 2.5 Statements of Obligations. The Loan and the joint and several
Borrowers' obligation to repay the same shall be evidenced by the Revolving
Credit Note and this Agreement, and all payments of principal or interest with
respect to the Loan shall be evidenced by notations made by Lender on Lender's
books and records showing the date and amount of the applicable Advance and each
payment of principal or interest.
SECTION 2.6 Prepayments. In the event the Borrowers desire to repay any or
all of the then outstanding principal balance due under the Note prior to the
Maturity Date, the Borrowers may do so at any time without penalty.
SECTION 2.7 Cross-Default/Cross-Collateral Provisions. An Event of Default
hereunder shall constitute an Event of Default under the Revolving Credit Note.
SECTION 2.8 Time and Place of Payment. Each payment due on the Revolving
Credit Note shall be made to Lender in immediately available funds, not later
than 12:00 p.m., local time, on the day of payment, at the Lender's then
business office.
SECTION 2.9 Joint and Several Liability: Payment; Indemnifications.
(a) Each Borrower hereby agrees and acknowledges that the obligation of
each Borrower for payment of the Obligations shall be joint and several with the
obligations of each other Borrower
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hereunder regardless of which Borrower actually receives the proceeds of any
borrowing. Each Borrower hereby agrees and acknowledges that it will receive
substantial benefits from the Loan, including each and all Advances. The
Obligations shall not be impaired or released by any action or inaction on the
part of Lender with respect to any other Borrower, including any action or
inaction that otherwise would release a surety.
(b) In order to provide for just and equitable contribution between the
Borrowers if any payment is made by a Borrower (for purposes of this Section
2.9(b), a "Funding Borrower") in discharging any of the Obligations, that
Funding Borrower shall be entitled to a contribution from the other Borrowers
for all payments, damages and expenses incurred by that Funding Borrower in
discharging the Obligations, in the manner and to the extent required to
allocate liabilities in an equitable manner among the Borrowers on the basis of
the relative benefits received by the Borrowers. If and to the extent that a
Funding Borrower makes any payment to the Lender or any other Person in respect
of the Obligations, any claim that such Funding Borrower may have against the
other Borrowers by reason thereof shall be subject and subordinate to the prior
cash payment in full of the Obligations.
(c) The parties hereto acknowledge that the right to contribution
hereunder shall constitute an asset of the party to which such contribution is
owing. Notwithstanding any of the foregoing to the contrary, such contribution
arrangements shall not limit in any manner the joint and several nature of the
Obligations; shall not limit, release or otherwise impair any rights of the
Lender under the Credit Documents, and shall not alter, limit or impair the
obligation of any Borrower, which obligation is absolute and unconditional, to
repay the Obligations.
(d) The parties expressly agree that payment by any Borrower of amounts
due and payable on the Media Notes that is made pursuant to such Borrower's
Guaranty agreement shall to the extent and in the amount of such payment
constitute a payment and discharge of such Borrower's Obligations on the Note
and the Loan.
ARTICLE III
CONDITIONS TO BORROWING
SECTION 3.1 Disbursement of Closing Date Advances and Effectiveness of
Agreement. This Agreement shall become effective and Lender shall disburse the
Closing Date Advances in accordance with Section 2.2 above if, and only if, each
of the following conditions have been fulfilled to the satisfaction of
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Lender and its legal counsel (the occurrence of which shall be called,
collectively, the "Closing"):
(a) receipt by Lender of this Agreement and each of the other Credit
Documents, all duly executed and, where required, acknowledged; and
(b) receipt by Lender of all other documents Lender reasonably may request
be delivered by Borrowers.
SECTION 3.2 Conditions to Lender's Approval of Additional Advance(s).
Lender shall not be deemed to have approved and shall not make any Additional
Advance(s) unless and until the following conditions have been fulfilled with
respect to each such Additional Advance:
(a) Lender shall have received and approved a request from the Borrower(s)
for disbursement of such an Additional Advance;
(b) the Maturity Date shall not have occurred;
(c) the then sum of the Advances outstanding and unpaid (including the
Advance then requested) shall not exceed the amount specified in Section 2.2;
(d) no Borrower then is in default of any material term, covenant or
condition under any Credit Document; and
(e) Lender is not then in default to ▇▇▇▇▇ Media on Lender's note payable
to ▇▇▇▇▇ Media of even date herewith in the initial principal amount of the
Credit Facility.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Each Borrower makes the following representations and warranties to
Lender, which representations and warranties shall survive the execution of this
Agreement and shall continue in full force and effect until the payment,
performance and satisfaction in full of the Obligations.
SECTION 4.1 Legal Status. Each Borrower is an entity duly organized and
existing under the laws of the Commonwealth of Virginia.
SECTION 4.2 No Violation: Compliance. As of Closing, the execution,
delivery, and performance of this Agreement and the other Credit Documents are
within each Borrower's respective powers, are not in conflict with the terms of
any charter, bylaw, or other agreement, and do not result in a breach of or
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constitute a default under any contract, obligation, indenture, or other
instrument to which either is a party or by which either is bound or affected;
and there is no law, rule or regulation, nor is there any judgment, decree or
order of any court or governmental authority binding on any Borrower that would
be contravened by the execution, delivery, performance, or enforcement of this
Agreement or the other Credit Documents.
SECTION 4.3 Authorization; Validity. Each Borrower has taken all
partnership, corporate, limited liability company, or other action necessary to
authorize the execution and delivery of this Agreement and the other Credit
Documents, and the consummation of the transactions contemplated hereby and
thereby.
SECTION 4.4 Approvals; Consents. As of the date of this Agreement, no
approval, consent, exemption or other action by, or notice to or filing with,
any governmental authority is presently necessary in connection with the
execution, delivery, performance or enforcement of this Agreement or the other
Credit Documents except as may have been obtained by the Borrowers with
certified copies delivered to Lender.
SECTION 4.5 Binding Agreements. This Agreement and all other Credit
Documents have been duly executed and delivered by each Borrower. This Agreement
and each other Credit Document to which any Borrower is a party, constitute the
legal, valid and binding obligations of each Borrower enforceable in accordance
with their terms, except insofar as the enforceability hereof or thereof may be
limited by applicable bankruptcy, insolvency or other similar laws now or
hereafter in effect affecting the enforcement of creditors' rights generally, or
by general principals of equity.
ARTICLE V
AFFIRMATIVE COVENANTS
Borrower covenants and agrees that until the Obligations have been paid in
full to Lender, each Borrower shall:
SECTION 5.1 Punctual Payments. Punctually pay the interest and principal
on the Loan, and any fees or other liabilities due under this Agreement and the
other Credit Documents, at the times and place and in the manner specified in
this Agreement.
SECTION 5.2 Books and Records. Maintain adequate books and records and
permit any authorized representative of Lender, or Lender, at any reasonable
time during normal business hours, to inspect, audit, and examine such books and
records, to make copies of the same, and to inspect the Borrowers' Assets.
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SECTION 5.3 Financial Statements. Deliver to Lender the following, all in
form and detail reasonably satisfactory to Lender:
(a) as soon as available but not later than thirty (30) days after
receipt, a Financial Statement for each Borrower for the Fiscal Year then ended;
and
(b) from time to time such other information as Lender may reasonably
request.
SECTION 5.4 Existence; Compliance with Law. Preserve and maintain its
existence and all of its licenses (including without limitation, all FCC
licenses), permits, governmental approvals, rights, privileges and franchises
required for the operations of the Borrowers to the extent that failure to
preserve and maintain the same could reasonably be expected to have a Material
Adverse Effect; comply with the provisions of all documents pursuant to which
each Borrower is organized that govern such Borrower's continued existence to
the extent that failure to so comply could reasonably be expected to have a
Material Adverse Effect on any Borrower; and comply with the requirements of all
applicable laws, rules, regulations, orders of any governmental authority and
requirements for the maintenance of each Borrower's insurance, licenses,
permits, governmental approvals, rights, privileges and franchises, to the
extent that failure to so comply could reasonably be expected to have a Material
Adverse Effect.
SECTION 5.5 Inspection of Assets. Allow Lender and its representatives
access to inspect the Assets, including the Radio Stations, and the Newspapers,
upon reasonable notice by Lender to the Borrowers.
SECTION 5.6 Notice to Lender. Promptly upon the Borrowers acquiring
knowledge thereof, give notice to Lender of:
(a) all litigation affecting the Borrowers where the amount claimed is in
excess of One Hundred Thousand Dollars ($100,000) for any individual matter or
in excess of Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate and
when such amount is not covered by applicable insurance (less applicable
deductibles);
(b) any substantial dispute which may exist between any Borrower, on the
one hand, and any governmental regulatory body or law enforcement authority, on
the other, if the determination of such dispute could reasonably be expected to
have a Material Adverse Effect;
13
(c) any labor controversy resulting in or threatening to result in a
strike against any Borrower, if the commencement of such strike could reasonably
be expected to have a Material Adverse Effect;
(d) any Default or Event of Default;
(e) any other matter that has resulted in or could reasonably be expected
to have a Material Adverse Effect upon a Borrower; and
(f) any sale or transfer of any capital stock of membership interest in,
or partnership interest in, any Borrower or any affiliate directly or indirectly
owning or owned by any Borrower.
SECTION 5.7 Compliance with Indenture. Comply in all respects with
requirements of the Indenture as applicable to each Borrower as a "Restricted
Subsidiary" as therein identified and defined.
SECTION 5.8 Notice of FCC Reports. Promptly upon their becoming available,
provide Lender with copies of each periodic or special report filed by or on
behalf of any Borrower with the FCC, if such reports indicate any material
adverse change in the business, operations, affairs, or conditions of Borrower's
business, and copies of any material notices or other communications from the
FCC that specifically relate to the operation of any Borrower's business.
ARTICLE VI
NEGATIVE COVENANTS
The Borrowers further covenant and agree that until the Obligations have
been fully paid to Lender, without Lender's prior consent and except as and to
the extent permitted to a Restricted Subsidiary under the Indenture, the
Borrowers shall not:
SECTION 6.1 Compliance with Indenture. Take any action not permitted to a
Restricted Subsidiary by the Indenture.
SECTION 6.2 Character of Business. Engage in any business activities or
operations substantially different from or unrelated to the present business
activities and operations of the Borrowers.
SECTION 6.3 Dividends, Distributions. While an Event of Default shall have
occurred and be continuing, declare, make, or pay any dividend or distribution
in cash or kind except as otherwise provided for or permitted herein or in the
Indenture.
14
SECTION 6.4 Change in Ownership. Cause, permit or suffer any material
change, direct or indirect, in the capital ownership, membership, or control of
any Borrower.
SECTION 6.5 Change in Name. Cause, permit or suffer any material change in
the name of any Borrower.
SECTION 6.6 Change in Fiscal Year or Fiscal Year End. Change any
Borrower's Fiscal Year or Fiscal Year End.
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES
SECTION 7.1 Events of Default. The occurrence of any one or more of the
following events, acts or occurrences shall constitute an event of default (an
"Event of Default") hereunder:
(a) The Borrowers fail to timely make or cause to be made any payment of
interest due on the Revolving Credit Note;
(b) The Borrowers fail to pay the Loan when due and payable at maturity,
including the payment of any Post-Closing Lender Expenses, or any other amount
then payable hereunder;
(c) The Borrowers fail to observe or perform any covenant applicable to a
Restricted Subsidiary and set forth in the Indenture or in Article V, Article VI
or Article VIII herein or any other Credit Document;
(d) Any Borrower commences a voluntary Insolvency Proceeding seeking
liquidation, reorganization or other relief with respect to itself or seeking
the appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or consents to any such
relief or to the appointment of or taking possession by any such official in an
involuntary Insolvency Proceeding or fails generally to pay its debts as they
become due, or takes any corporate action to authorize any of the foregoing;
(e) (1) A court of competent jurisdiction enters a decree or order for
relief in respect of any Borrower in an insolvency case under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency, or similar law now or
hereafter in effect, which decree or order is not stayed; or any other similar
relief shall be granted under any applicable federal or state law; or (2) An
involuntary Insolvency Proceeding is commenced against any Borrower seeking
liquidation, reorganization or other relief with respect to it or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, and such
15
involuntary Insolvency Proceeding remains undismissed and unstayed for a period
of sixty (60) days:
(f) A judgment creditor obtains possession of any of the Assets of any
Borrower by any means, including levy, discounts replevin, or self-help, or one
or more judgments are entered against the Borrowers involving singly or in the
aggregate a liability in excess of Five Hundred Thousand Dollars ($500,000) (to
the extent not fully covered by insurance) or any order, judgment or decree is
entered decreeing the dissolution of the Borrowers and such order remains
undischarged or unstayed for a period in excess of ninety (90) calendar days;
(g) The FCC Licenses (excluding any auxiliary licenses) are modified
adversely, revoked, suspended, canceled or otherwise rendered non-transferable
by the FCC or any other regulatory agency or court of competent jurisdiction and
such action shall have become a Final FCC Order; or
(h) Any Radio Operator shall fail to be the licensee under any or all of
the FCC Licenses other than in connection with a sale or transfer of any of the
FCC Licenses consented to by Lender.
SECTION 7.2 Remedies. Upon the occurrence and during the continuance of
any Event of Default not cured within the Cure Period or waived by the Lender,
the principal amount then due under the Note shall begin to accrue interest at
the Default Rate. In the event such Event of Default is cured within any
applicable Cure Period, the interest rate on the Loan thereupon shall revert to
the Initial Interest Rate. The Lender also shall have all remedies set forth
herein and in the other Credit Documents and all remedies at law or in equity
that are consistent with the Communications Act and the rules and regulations of
the FCC.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1 Notices. All notices, requests and other communications to any
party hereunder shall be in writing and shall be given to such party at its
address and to the telefax number set forth below or such other address or
telefax number as such party may hereafter specify for the purpose by notice to
the other party:
If to the Borrowers:
16
Central Michigan Newspapers, Inc.
c/o Brill Media Company, L.P.
▇▇▇ ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
100 Shockoe Slip
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Lender:
BMC Holdings, LLC
c/o Brill Media Company, L.P.
▇▇▇ ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Any notice or other communication provided for or allowed hereunder shall be
considered to have been validly given if delivered personally, and evidenced by
a receipt signed by an authorized Lender or addressee, or ten (10) hours after
being deposited in the United States mail, registered or certified, postage
prepaid, return receipt requested, or forty-eight (48) hours after being sent by
Federal Express or other courier service, or, in the case of telefaxed notice,
when telefaxed, receipt acknowledged.
SECTION 8.2 No Implied Waivers. No failure or delay by Lender in
exercising any right, power, or privilege hereunder or under any Credit Document
shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies herein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.
SECTION 8.3 Expenses; Documentary Taxes; Indemnification. Borrower shall
pay (1) all Lender's Post-Closing Expenses; and (2) if an Event of Default
occurs, all out-of-pocket expenses incurred by Lender, including reasonable
attorneys' fees and expenses incurred in connection with such Event of Default
and
17
collection and other enforcement proceedings resulting therefrom or in
connection with any refinancing or restructuring of the Obligations and the
liabilities of the Borrowers under this Agreement, any of the other Credit
Documents, or any other document, instrument or agreement subsequently entered
into.
SECTION 8.4 Amendments and Waivers. Any provision of this Agreement, or
any of the other Credit Documents to which the Borrowers are a party, may be
amended or waived at any time if, but only if, such amendment or waiver is in
writing and is signed by the Borrowers and Lender.
SECTION 8.5 No Assignment; Non-Recourse. Neither Borrowers nor Lender
shall have the right to assign or transfer to any party, in whole or in part,
any of the rights, duties or obligations of Borrower(s) or Lender under this
Agreement or any of the Credit Documents executed contemporaneously herewith, or
any subsequent amendment, renewal, extension, modification, or restatement of
this Agreement or any of the Credit Documents. Anything herein to the contrary
notwithstanding, all indebtedness on the Note, the Obligations, or this
Agreement shall be Non-Recourse Debt as defined in and meant by the Indenture.
SECTION 8.6 Counterparts; Integration; Effectiveness. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof. This
Agreement shall become effective upon the execution of a counterpart hereof by
each Borrower and Lender and receipt by Borrowers and Lender of written or
telephonic notification of such execution and authorization of delivery thereof.
SECTION 8.7 Governing Law; Jurisdiction.
(a) GOVERNING LAW. THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS (EXCEPT
TO THE EXTENT OTHERWISE EXPRESSLY SET FORTH THEREIN) SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF VIRGINIA, WITHOUT
REGARD TO CONFLICT OF LAWS PRINCIPLES.
(b) JURISDICTION AND VENUE. TO THE MAXIMUM EXTENT PERMITTED BY LAW, THE
PARTIES HERETO AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH
THIS AGREEMENT OR THE OTHER CREDIT DOCUMENTS MAY BE TRIED AND LITIGATED IN THE
COMMONWEALTH OF VIRGINIA. TO THE EXTENT THEY MAY LEGALLY DO SO, THE PARTIES
HERETO HEREBY WAIVE ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON
CONVENIENS OR TO OBJECT TO VENUE TO THE
18
EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 8.7(b) AND
STIPULATE THAT ANY SUCH COURT SHALL HAVE IN PERSONAM JURISDICTION AND VENUE OVER
EACH SUCH PARTY FOR THE PURPOSE OF LITIGATING ANY SUCH DISPUTE, CONTROVERSY, OR
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT, OR THE OTHER CREDIT
DOCUMENTS. SERVICE OF PROCESS SUFFICIENT FOR PERSONAL JURISDICTION IN ANY ACTION
AGAINST BORROWER MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT
REQUESTED, TO THEIR ADDRESS SPECIFIED FOR NOTICES PURSUANT TO SECTION 8.1
HEREOF. THE PARTIES HERETO ACKNOWLEDGE AND AGREE THAT THIS AGREEMENT AND THE
OTHER CREDIT DOCUMENTS SHALL FOR ALL PURPOSES BE DEEMED TO HAVE BEEN ENTERED
INTO IN THE COMMONWEALTH OF VIRGINIA.
(c) WAIVER OF TRIAL BY JURY. THE PARTIES HERETO EACH AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR THE OTHER CREDIT DOCUMENTS. The scope of this
waiver is intended to be all encompassing of any and all disputes that may be
filed in any court and that relate to the subject mater of this transaction,
including without limitation contract claims, tort claims, breach of duty claims
and all other common law and statutory claims. The parties hereto each (1)
acknowledge that this waiver is a material inducement for the parties to enter
into a business relationship, that the parties hereto have already relied on
this waiver in entering into this Agreement or accepting the benefits thereof,
as the case may be, and that each will continue to rely on this waiver in their
related future dealings, and (2) further warrant and represent that each has
reviewed this waiver with its legal counsel, and that each knowingly and
voluntarily waives its jury trial rights following consultation with legal
counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, OR MODIFICATIONS OF THIS AGREEMENT. In the event of litigation, this
Agreement may be filed as a written consent to a trial by the court.
SECTION 8.8 Survival of Warranties. All agreements and the representations
and warranties made herein shall survive the execution and delivery of this
Agreement.
SECTION 8.9 Severability. In case any provision in or obligation under
this Agreement 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. Neither this Agreement nor any
Credit Document nor any part or parts thereof shall create any right in any
third party that is not a party signatory hereto or thereto.
19
SECTION 8.10 Maximum Interest Rate. Notwithstanding anything to the
contrary contained in the Revolving Credit Note or this Agreement, the Borrowers
shall not be obligated to pay, and Lender shall not be entitled to charge,
collect, receive, reserve, or take interest (it being understood that interest
shall be calculated as the aggregate of all charges which constitute interest
under applicable law that are contracted for, charged, reserved, received, or
paid) in excess of the maximum rate permitted by law. During any period of time
in which the interest rates specified herein exceed the maximum rate permitted
by law, interest shall accrue and be payable at such maximum rate. If from any
circumstances whatsoever, fulfillment of any provision of the Revolving Credit
Note, or this Agreement or of any other document pertaining hereto or thereto,
shall involve transcending the limit of validity prescribed by law for the
collection or charging of interest, then ipso facto, the obligation to be
fulfilled shall be reduced to the limit of such validity, and if from any such
circumstances Lender shall ever receive anything of value as interest or deemed
interest by applicable law under the Revolving Credit Note, this Agreement, any
of the other Credit Documents or any other document pertaining hereto, thereto
or otherwise an amount that would exceed the maximum rate permitted by law, such
amount that would be excessive interest shall be applied to the reduction of the
principal amount owing under the Revolving Credit Note or on account of any
other indebtedness of the Borrowers to Lender, and not to the payment of
interest, or if such excessive interest exceeds the unpaid balance of principal
of such indebtedness, such excess shall be refunded to the Borrowers. In
determining whether or not the interest paid or payable with respect to any
indebtedness of the Borrowers to Lender, under any specified contingency,
exceeds the maximum rate permitted by law, the Borrowers and Lender shall, to
the maximum extent permitted by applicable law, (a) characterize any
non-principal payment as an expense, fee or premium rather than as interest, (b)
exclude voluntary prepayments and the effects thereof, (c) amortize, prorate,
allocate, and spread the total amount of interest throughout the actual term of
such indebtedness such that it does not exceed the maximum amount permitted by
applicable law, and/or (d) allocate interest between portions of such
indebtedness, to the end that no such portion shall bear interest at a rate
greater than that permitted by applicable law.
SECTION 8.11 Headings. Section and subsection 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.
SECTION 8.12 Marshaling; Payments Set Aside. Lender shall be under no
obligation to marshal any assets in favor of the Borrowers or any other party or
against or in payment of any or
20
all of the Obligations. To the extent any Borrower makes a payment or payments
to Lender, or exercises its rights of setoff, and such payment or payments or
the proceeds of such enforcement or setoff or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, or other state or federal law, common law or any equitable
cause, then, to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all rights and remedies therefor or
related thereto, shall be revived and continued in full force and effect as if
such payment or payments had not been made or such enforcement or setoff had not
occurred.
SECTION 8.13 Further Assurances and Release By Lender. Upon payment in
full of the Obligations, as herein provided, this Agreement and each of the
other Credit Documents (other than the Indenture) shall terminate and the Lender
shall, at the Borrowers' sole expense, execute and deliver to the Borrowers such
statements or such other instruments and further assurances as the Borrowers'
reasonably may request acknowledging satisfaction and discharge of the
Obligations and this Agreement and each of the other Credit Documents (other
than the Indenture).
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the date and year
first above written.
BORROWERS:
NORTHLAND BROADCASTING, LLC
By: Northland Management, Inc., a
Virginia corporation,
Managing Member
By:________________________________
a duly Authorized Officer
READING RADIO, INC.
By:________________________________
a duly Authorized Officer
CENTRAL MISSOURI BROADCASTING, INC.
By:________________________________
a duly Authorized Officer
21
NORTHERN COLORADO RADIO, INC.
By:________________________________
a duly Authorized Officer
TRI-STATE BROADCASTING, INC.
By:________________________________
a duly Authorized Officer
CMB II, INC.
By:________________________________
a duly Authorized Officer
▇▇ ▇▇, INC.
By:________________________________
a duly Authorized Officer
CENTRAL MICHIGAN NEWSPAPERS, INC.
By:________________________________
a duly Authorized Officer
GRAPH ADS PRINTING, INC.
By:________________________________
a duly Authorized Officer
GLADWIN NEWSPAPERS, INC.
By:________________________________
a duly Authorized Officer
CADILLAC NEWSPAPERS, INC
By:________________________________
a duly Authorized Officer
22
MIDLAND BUYER'S GUIDE. INC.
By:________________________________
a duly Authorized Officer
CMN ASSOCIATED PUBLICATIONS, INC.
By:________________________________
a duly Authorized Officer
CENTRAL MICHIGAN DISTRIBUTION CO.,
INC.
By:________________________________
a duly Authorized Officer
CENTRAL MICHIGAN DISTRIBUTION CO.,
INC.
By: Central Michigan Distribution
Co., Inc., Its General
Partner
By:________________________________
a duly Authorized Officer
▇▇▇▇▇ NEWSPAPERS, INC.
By:________________________________
a duly Authorized Officer
▇▇▇▇▇ RADIO, INC.
By:________________________________
a duly Authorized Officer
HURON HOLDINGS, LLC
By:
By:________________________________
a duly Authorized Officer
23
NORTHERN COLORADO HOLDINGS, LLC
By:
By:________________________________
a duly Authorized Officer
NCR III, LLC
By:
By:________________________________
a duly Authorized Officer
NORTHLAND HOLDINGS, LLC
By:
By:________________________________
a duly Authorized Officer
CMN HOLDINGS, INC.
By:________________________________
a duly Authorized Officer
NCH II, LLC
By:
By:________________________________
a duly Authorized Officer
ST. ▇▇▇▇▇ NEWSPAPERS, INC.
By:________________________________
a duly Authorized Officer
NCR II, INC.
By:________________________________
a duly Authorized Officer
24
HURON NEWSPAPERS, LLC
By: Huron Management, Inc., a
Virginia corporation,
Managing Member
By:________________________________
a duly Authorized Officer
HURON P.S., LLC
By: Huron Management, Inc., a
Virginia corporation,
Managing Member
By:________________________________
a duly Authorized Officer
LENDER:
BMC HOLDINGS, LLC, a Virginia
Limited Liability Company
By: ▇▇▇▇▇ Media Company, LLC,
its Member
By: ▇▇▇▇▇ Media Management, Inc.,
its Manager
By:_________________________
a duly Authorized Officer
25