Exhibit 4.6
PARENT GUARANTEE AGREEMENT
Between
▇▇▇▇▇▇▇▇ Broadcast Group, Inc.
(as Guarantor of Preferred Securities)
and
First Union National Bank of Maryland
(as Trustee)
dated as of
______ __, 1997
TABLE OF CONTENTS
ARTICLE I DEFINITIONS........................................... 1
SECTION 1.1. Definitions........................................... 1
ARTICLE II TRUST INDENTURE ACT................................... 7
SECTION 2.1. Trust Indenture Act; Application............... 7
SECTION 2.3. Reports by the Trustee......................... 8
SECTION 2.4. Periodic Reports to Trustee.................... 8
SECTION 2.5. Evidence of Compliance with Conditions
Precedent...................................... 8
SECTION 2.6. Event of Default; Notice; Waiver............... 8
SECTION 2.7. Conflicting Interests.......................... 9
ARTICLE III POWERS, DUTIES AND RIGHTS OF TRUSTEE.................. 9
SECTION 3.1. Powers and Duties of the Trustee............... 9
SECTION 3.2. Certain Rights of Trustee...................... 11
ARTICLE IV TRUSTEE............................................... 13
SECTION 4.1. Trustee; Eligibility........................... 13
SECTION 4.2. Appointment, Removal and Resignation of
Trustee........................................ 13
ARTICLE V GUARANTEE............................................. 14
SECTION 5.1. Guarantee...................................... 14
SECTION 5.2. Waiver of Notice and Demand.................... 14
SECTION 5.3. Obligations Not Affected....................... 15
SECTION 5.4. Rights of Holders.............................. 16
SECTION 5.5. Guarantee of Payment........................... 16
SECTION 5.6. Subrogation.................................... 16
SECTION 5.7. Independent Obligations........................ 17
ARTICLE VI LIMITATION OF TRANSACTIONS; SUBORDINATION............. 17
SECTION 6.1. Limitation of Transactions..................... 17
SECTION 6.2. Subordination.................................. 17
ARTICLE VII TERMINATION........................................... 18
SECTION 7.1. Termination.................................... 18
ARTICLE VIII MISCELLANEOUS......................................... 18
SECTION 8.1. Successors and Assigns......................... 18
SECTION 8.2. Amendments..................................... 18
SECTION 8.3. Notices........................................ 18
SECTION 8.4. Benefit........................................ 20
SECTION 8.5. No Benefit to Creditors of Trust............... 20
SECTION 8.6. Interpretation................................. 20
SECTION 8.7. Governing Law.................................. 21
PARENT GUARANTEE AGREEMENT
This PARENT GUARANTEE AGREEMENT (the "Parent Guarantee Agreement"),
dated as of _____ __, 1997, is executed and delivered by ▇▇▇▇▇▇▇▇ Broadcast
Group, Inc., a Maryland corporation (the "Guarantor"), and First Union National
Bank of Maryland, as trustee (the "Trustee"), for the benefit of the Holders (as
defined herein) from time to time of the Preferred Securities (as defined
herein) of ▇▇▇▇▇▇▇▇ Capital, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Trust Agreement (as
amended or supplemented from time to time in accordance with its terms, the
"Trust Agreement"), dated as of March 12, 1997, among the Trustees of the Issuer
named therein, KDSM, Inc., as Depositor, and the Holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing as of the date hereof $200,000,000 aggregate Liquidation Value of its 11
5/8% High Yield Trust Offered Preferred Securities, (the "Preferred Securities")
representing undivided beneficial interests in the assets of the Issuer and
having the terms set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Issuer and the
proceeds thereof will be used to purchase the KDSM Senior Debentures of the
Depositor which will be deposited with the Issuer as trust assets;
WHEREAS, as incentive for the Holders to purchase the Preferred
Securities, the Guarantor desires to irrevocably and unconditionally agree to
pay in full on a junior subordinated basis, to the extent set forth herein, the
Guarantee Payments (as defined herein) to the Holders of the Preferred
Securities and to make certain other payments on the terms and conditions set
forth herein; and
WHEREAS, the creditors of the Issuer shall not have any benefits from
this Parent Guarantee Agreement.
NOW, THEREFORE, in consideration of the payment for Preferred
Securities by each Holder thereof, which payment the Guarantor hereby agrees
shall benefit the Guarantor, the Guarantor executes and delivers this Parent
Guarantee Agreement for the benefit of the Holders from time to time of the
Preferred
ARTICLE I
-----------
DEFINITIONS
-----------
SECTION 1.1. Definitions. As used in this Parent Guarantee Agreement,
the terms set forth below shall, unless the context otherwise requires, have the
following meanings. Capitalized or otherwise defined terms used but not
otherwise defined herein shall have the meanings assigned to such terms in the
Trust Agreement as in effect on the date hereof.
"Affiliate" means, with respect to any specified Person, (i)
any other Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified Person,
(ii) any other Person that owns, directly or indirectly, 5% or more of
such Person's Equity Interest or any officer or director of any such
Person or other Person or, with respect to any natural Person, any
Person having a relationship with such Person or other Person by blood,
marriage or adoption not more remote than first cousin or (iii) any
other Person 10% or more of the voting Equity Interests of which are
beneficially owned or held directly or indirectly by such specified
Person. For the purposes of this definition, "control" when used with
respect to any specified Person means the power to direct the
management and policies of such Person directly or indirectly, whether
through ownership of voting securities, by contract or otherwise; and
the terms "controlling" and "controlled" have meanings correlative to
the foregoing.
"Capital Lease Obligation" means any obligation under any
capital lease of real or personal property which, in accordance with
GAAP, has been recorded as a capitalized lease obligation.
"Disqualified Equity Interests" means any Equity Interests
that, either by their terms or by the terms of any security into which
they are convertible or exchangeable or otherwise, are or upon the
happening of an event or passage of time would be required to be
redeemed prior to the stated maturity, if any, of the Preferred
Securities or are redeemable at the option of the holder thereof at any
time prior to any such stated maturity, if any, or are convertible into
or exchangeable for debt securities at any time prior to any such
stated maturity, if any, at the option of the holder thereof.
"Equity Interest" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or
other equivalents of or interests in (however designated) corporate
stock or other equity participations, including partnership interests,
whether general or limited, of such Person, including any preferred
Equity Interests.
"Event of Default" shall occur upon the failure of the
Guarantor to perform any of its obligations under this Parent Guarantee
Agreement.
"GAAP" means generally accepted accounting principles in the
United States, consistently applied, which are in effect on the date
the 1993 Notes were issued.
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"Guaranteed Debt" of any Person means, without duplication,
all Indebtedness of any other Person referred to in the definition of
Indebtedness contained herein and guaranteed directly or indirectly in
any manner by such Person, or in effect guaranteed directly or
indirectly by such Person through an agreement (i) to pay or purchase
such Indebtedness or to advance or supply funds for the payment or
purchase of such Indebtedness, (ii) to purchase, sell or lease (as
lessee or lessor) property, or to purchase or sell services, primarily
for the purpose of enabling the debtor to make payment of such
Indebtedness or to assure the holder of such Indebtedness against loss,
(iii) to supply funds to, or in any other manner invest in, the debtor
(including any agreement to pay for property or services without
requiring that such property be received or such services be rendered),
(iv) to maintain working capital or equity capital of the debtor, or
otherwise to maintain the net worth, solvency or other financial
condition of the debtor or (v) otherwise to assure a creditor against
loss; provided that the term "guarantee" shall not include endorsements
for collection or deposit, in either case in the ordinary course of
business.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Preferred
Securities: (i) any accrued and unpaid distributions on the Preferred
Securities that have been theretofore properly declared on the
Preferred Securities from funds of the Trust legally available therefor
in accordance with the terms of the Trust Agreement, (ii) the
redemption price payable with respect to any Preferred Securities
called for redemption by the Trust out of funds legally available
therefor in accordance with the terms of the Trust Agreement and (iii)
upon a voluntary or involuntary dissolution, winding-up or termination
of the Trust (other than in connection with a redemption of all of the
Preferred Securities), the payment of an amount if, when, and to the
extent holders of the Preferred Securities are lawfully entitled to
payment thereof from the Trust equal to the lesser of (a) the full
liquidation preference plus accumulated and unpaid dividends to which
the holders of the Preferred Securities are lawfully entitled, and (b)
the amount of the Trust's legally available assets remaining after
satisfaction of all claims of other parties which, as a matter of law,
are prior to those of the holders of the Preferred Securities (in
either case, the "Liquidation Distribution").
"Guarantor" means ▇▇▇▇▇▇▇▇ Broadcast Group, Inc. and its
successors, assigns, receivers, trustees and representatives as
provided in Section 8.1 hereunder.
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"Holder" shall mean any holder, as registered on the books and
records of the Issuer, of any Preferred Securities; provided, however,
that in determining whether the holders of the requisite percentage of
Preferred Securities have given any request, notice, consent or waiver
hereunder, "Holder" shall not include the Guarantor or any Affiliate of
the Guarantor.
"Indebtedness" means, with respect to any Person, without
duplication, (i) all indebtedness of such Person for borrowed money or
for the deferred purchase price of property or services, excluding any
trade payables and other accrued current liabilities arising in the
ordinary course of business, but including, without limitation, all
obligations, contingent or otherwise, of such Person in connection with
any letters of credit issued under letter of credit facilities,
acceptance facilities or other similar facilities and in connection
with any agreement to purchase, redeem, exchange, convert or otherwise
acquire for value any Equity Interests of such Person, or any warrants,
rights or options to acquire such Equity Interests, now or hereafter
outstanding, (ii) all obligations of such Person evidenced by bonds,
notes, debentures or other similar instruments, (iii) all indebtedness
created or arising under any conditional sale or other title retention
agreement with respect to property acquired by such Person (even if the
rights and remedies of the seller or lender under such agreement in the
event of default are limited to repossession or sale of such property),
but excluding trade payables arising in the ordinary course of
business, (iv) all obligations under Interest Rate Agreements of such
Person, (v) all Capital Lease Obligations of such Person, (vi) all
Indebtedness referred to in clauses (i) through (v) above of other
Persons and all dividends of other Persons, the payment of which is
secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien,
upon or with respect to property (including, without limitation,
accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such
Indebtedness, (vii) all Guaranteed Debt of such Person, (viii) all
Disqualified Equity Interests valued at the greater of their voluntary
or involuntary maximum fixed repurchase price plus accrued and unpaid
dividends, and (ix) any amendment, supplement, modification, deferral,
renewal, extension, refunding or refinancing of any liability of the
types referred to in clauses (i) through (viii) above.
"Indenture" means the Indenture dated as of March 12, 1997,
among KDSM, Inc., the Guarantor and First Union National Bank of
Maryland, as trustee, as amended and supplemented from time to time in
accordance with its terms.
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"Interest Rate Agreements" means one or more of the following
agreements which shall be entered into by the Guarantor and one or more
financial institutions: interest rate protection agreements (including,
without limitation, interest rate swaps, caps, floors, collars and
similar agreements) and/or other types of interest rate hedging
agreements from time to time.
"KDSM, Inc." means KDSM, Inc., a Maryland corporation.
"KDSM Senior Debentures" means the 11 5/8% Senior Debentures
due 2009 issued by KDSM, Inc. pursuant to the Indenture.
"Lien" means any mortgage, charge, pledge, lien (statutory or
otherwise), privilege, security interest, hypothecation or other
encumbrance upon or with respect to any property of any kind (including
any conditional sale or other title retention agreement, any leases in
the nature thereof, and any agreement to give any security interest),
real or personal, movable or immovable, now owned or hereafter
acquired.
"Liquidation Value" means the stated Liquidation Value of $100
per Trust Security.
"Majority in Liquidation Value of the Preferred Securities"
means a vote by Holder(s) of Preferred Securities, voting separately as
a class, of at least a majority in Liquidation Value of all outstanding
Preferred Securities.
"1993 Notes" means the Guarantors' 10% Senior Subordinated
Notes due 2003.
"Officers' Certificate" means with respect to any Person a
certificate signed by (i) the Chairman, a Vice Chairman, the Chief
Executive Officer, the President, a Vice President or the Treasurer of
such Person and (ii) the Secretary or an Assistant Secretary of such
Person, and delivered to the Trustee; provided, however, that such
certificate may be signed by two of the officers or directors listed in
clause (i) above in lieu of being signed by one of such officers or
directors listed in such clause (i) and one of the officers listed in
clause (ii) above. Any Officers' Certificate delivered with respect to
compliance with a condition or covenant provided for in this Parent
Guarantee Agreement shall include:
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(a) a statement that each officer or director signing the
Officers' Certificate has read the covenant or condition and the
definitions relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer or director in
rendering the Officers' Certificate;
(c) a statement that each such officer or director has made
such examination or investigation as, in such officer's or director's
opinion, is necessary to enable such officer or director to express an
informed opinion as to whether or not such covenant or condition has
been complied with; and
(d) a statement as to whether, in the opinion of each such
officer or director, such condition or covenant has been complied with.
"Parent Preferred" means the shares of Series C Preferred
Stock, par value $.01 per share, liquidation value of $100 per share,
issued by the Guarantor.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, trust, unincorporated
organization or government or any agency or political subdivision
thereof.
"Responsible Officer" means, with respect to the Trustee, any
vice-president, any assistant vice-president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, any trust
officer or assistant trust officer or any other officer of the
Corporate Trust Department of the Trustee customarily performing
functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of
that officer's knowledge of and familiarity with the particular
subject.
"Successor Trustee" means a successor Trustee possessing the
qualifications to act as Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed;
provided, however, that in the event the Trust Indenture Act of 1939 is
amended after such date, "Trust Indenture Act" means, to the extent
required by any such amendment, the Trust Indenture Act of 1939, as so
amended.
"Trustee" means the First Union National Bank of Maryland
until a Successor Trustee has been appointed and
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has accepted such appointment pursuant to the terms of this Parent
Guarantee Agreement and thereafter means each such Successor Trustee.
ARTICLE II
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TRUST INDENTURE ACT
-------------------
SECTION 2.1. Trust Indenture Act; Application.
As of the date hereof,
(a) this Parent Guarantee Agreement shall, as a matter of contract law,
be subject to the provisions of the Trust Indenture Act that are required to be
part of this Parent Guarantee Agreement and shall, to the extent applicable, be
governed by such provisions; and
(b) if and to the extent that any provision of this Parent Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by Sections 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
SECTION 2.2. Lists of Holders of Securities.
(a) To the extent not available to the Trustee, the Guarantor shall
furnish or cause to be furnished to the Trustee (a) quarterly, not later than
March 15, June 15, September 15 and December 15 in each year, a list, in such
form as the Trustee may reasonably require, of the names and addresses of the
Holders of the Preferred Securities ("List of Holders") as of a date not more
than 15 days prior to the delivery thereof as required by the Trustee and (b) at
such other times as the Trustee may reasonably request in writing, within 30
days after the receipt by the Guarantor of any such request, a List of Holders
as of a date not more than 15 days prior to the time such list is furnished;
provided that the Guarantor shall not be obligated to provide such List of
Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Trustee by the Guarantor. The Trustee may destroy
any List of Holders previously given to it on receipt of a new List of Holders.
(b) The Trustee shall comply with the obligations set forth under
Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act whether or not the
Trust Indenture Act is then applicable to this Parent Guarantee Agreement, and
such provisions are hereby incorporated by reference herein.
SECTION 2.3. Reports by the Trustee. Within 60 days after May 15 of
each year, the Trustee shall provide to the Holders of the Preferred Securities
such reports as are required by Section
7
313 of the Trust Indenture Act, if any, in the form and in the manner provided
by Section 313 of the Trust Indenture Act whether or not the Trust Indenture Act
is then applicable to this Parent Guarantee Agreement, and such provisions are
hereby incorporated by reference herein. The Trustee shall also comply with the
requirements of Section 313(d) of the Trust Indenture Act whether or not the
Trust Indenture Act is then applicable to this Parent Guarantee Agreement, and
such provisions are hereby incorporated by reference herein.
SECTION 2.4. Periodic Reports to Trustee. The Guarantor shall provide
to the Trustee such documents, reports and information as are required by
Section 314 of the Trust Indenture Act (if any) and the compliance certificate
required by Section 314 of the Trust Indenture Act in the form, in the manner
and at the times required by Section 314 of the Trust Indenture Act whether or
not the Trust Indenture Act is then applicable to this Parent Guarantee
Agreement, and such provisions are hereby incorporated by reference herein.
SECTION 2.5. Evidence of Compliance with Conditions Precedent. The
Guarantor shall provide to the Trustee such evidence of compliance with any
conditions precedent provided for in this Parent Guarantee Agreement that relate
to any of the matters set forth in Section 314(c) of the Trust Indenture Act.
Any certificate or opinion required to be given by an officer pursuant to
Section 314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.6. Event of Default; Notice; Waiver.
(a) The Trustee shall, within 90 days after the occurrence of an Event
of Default, transmit by mail, first class postage prepaid, to the Holders of the
Preferred Securities, notices of all Events of Default known to the Trustee,
unless such defaults have been cured before the giving of such notice, provided
that the Trustee shall be protected in withholding such notice if and so long as
the board of directors, the executive committee, or a trust committee of
directors and/or Responsible Officers of the Trustee in good faith determines
that the withholding of such notice is in the interests of the Holders of the
Preferred Securities.
(b) The holders of a Majority in Liquidation Value of the Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default under this Parent Guarantee
Agreement and its consequences. Upon such waiver, any such Event of Default
shall cease to exist and any such Event of Default arising therefrom shall be
deemed to have been cured, for every purpose of this Parent Guarantee Agreement,
but no such waiver shall extend to any subsequent or
8
other default or Event of Default or impair any right consequent
thereon.
SECTION 2.7. Conflicting Interests. The Trust Agreement shall be deemed
to be specifically described in this Parent Guarantee Agreement for the purposes
of clause (i) of the first proviso contained in Section 310(b) of the Trust
Indenture Act.
ARTICLE III
-----------
POWERS, DUTIES AND RIGHTS OF TRUSTEE
------------------------------------
SECTION 3.1. Powers and Duties of the Trustee.
(a) This Parent Guarantee Agreement shall be held by the Trustee for
the benefit of the Holders of the Preferred Securities, and the Trustee shall
not transfer this Parent Guarantee Agreement to any Person except a Holder of
Preferred Securities exercising his or her rights pursuant to Section 5.4(iv) or
to a Successor Trustee on acceptance by such Successor Trustee of its
appointment to act as Successor Trustee. The right, title and interest of the
Trustee shall automatically vest in any Successor Trustee, and such vesting and
cessation of title shall be effective whether or not conveyancing documents have
been executed and delivered pursuant to the appointment of such Successor
Trustee.
(b) If an Event of Default has occurred and is continuing, the Trustee
shall enforce this Parent Guarantee Agreement for the benefit of the Holders of
the Preferred Securities.
(c) The Trustee, before the occurrence of any Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Parent Guarantee Agreement, and no implied covenants against the Trustee shall
be read into this Parent Guarantee Agreement. In case an Event of Default has
occurred (that has not been cured or waived pursuant to Section 2.6), the
Trustee shall exercise such of the rights and powers vested in it by this Parent
Guarantee Agreement, 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 his or her own affairs.
(d) No provision of this Parent Guarantee Agreement shall be construed
to relieve the Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:
9
(A) the duties and obligations of the Trustee shall
be determined solely by the express provisions of this Parent
Guarantee Agreement, and the Trustee shall not be liable
except for the performance of such duties and obligations as
are specifically set forth in this Parent Guarantee Agreement;
and
(B) in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the
Trustee and conforming to the requirements of this Parent
Guarantee Agreement;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Trustee, unless it
shall be proved that the Trustee was negligent in ascertaining the
pertinent facts upon which such judgment was made;
(iii) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of a Majority in Liquidation Value of
the Preferred Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee under this
Parent Guarantee Agreement; and
(iv) no provision of this Parent Guarantee Agreement shall
require the Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or
in the exercise of any of its rights or powers, if the Trustee shall
have reasonable grounds for believing that the repayment of such funds
or liability is not reasonably assured to it under the terms of this
Parent Guarantee Agreement or adequate indemnity against such risk or
liability is not reasonably assured to it.
SECTION 3.2. Certain Rights of Trustee.
(a) Subject to the provisions of Section 3.1:
(i) the Trustee may rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document believed by it to be genuine and to have
been signed, sent or presented by the proper party or parties;
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(ii) any direction or act of the Guarantor contemplated by
this Parent Guarantee Agreement shall be sufficiently evidenced by an
Officers' Certificate;
(iii) whenever, in the administration of this Parent Guarantee
Agreement, the Trustee shall deem it desirable that a matter be proved
or established before taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
rely upon an Officers' Certificate which, upon receipt of such request,
shall be promptly delivered by the Guarantor;
(iv) the Trustee may consult with counsel of its choice, and
the written advice or opinion of such counsel with respect to legal
matters shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in
good faith and in accordance with such advice or opinion; such counsel
may be counsel to the Guarantor or any of its Affiliates and may
include any of its employees; and the Trustee shall have the right at
any time to seek instructions concerning the administration of this
Parent Guarantee Agreement from any court of competent jurisdiction;
(v) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Parent Guarantee Agreement
at the request or direction of any Holder, unless such Holder shall
have provided to the Trustee such adequate security and indemnity as
would satisfy a reasonable person in the position of the Trustee,
against the costs, expenses (including attorneys' fees and expenses)
and liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may be
requested by the Trustee;
(vi) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
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;
(vii) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys, and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder; and
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(viii) whenever in the administration of this Parent Guarantee
Agreement the Trustee shall deem it desirable to receive instructions
with respect to enforcing any remedy or right or taking any other
action hereunder, the Trustee (i) may request instructions from the
Holders of the Preferred Securities, (ii) may refrain from enforcing
such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in acting in
accordance with such instructions.
(b) No provision of this Parent Guarantee Agreement shall be deemed to
impose any duty or obligation on the Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Trustee shall be construed to be
a duty.
(c) The Trustee hereunder shall be entitled to fees and indemnity as
Trustee under this Parent Guarantee Agreement on the same terms as those set
forth in Section 8.06(2) and (3) of the Trust Agreement except that such
obligations will be those of the Guarantor and not the Depositor (as defined in
the Trust Agreement).
ARTICLE IV
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TRUSTEE
-------
SECTION 4.1. Trustee; Eligibility.
(a) There shall at all times be a Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof
or of the District of Columbia, or a corporation or Person permitted by
the Securities and Exchange Commission to act as an institutional
trustee under the Trust Indenture Act, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus
of at least $250 million U.S. dollars ($250,000,000), and subject to
supervision or examination by Federal, State, Territorial or District
of Columbia authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of
the supervising or examining authority referred to above, then, for the
purposes of this Section 4.1(a)(ii), the combined capital and surplus
of such
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corporation shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published.
(b) If at any time the Trustee shall cease to be eligible to so act
under Section 4.1(a), the Trustee shall immediately resign in the manner and
with the effect set out in Section 4.2(d).
(c) The Trustee and the Guarantor shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act whether or not the Trust
Indenture Act is then applicable to this Parent Guarantee Agreement, and such
provisions are hereby incorporated by reference herein.
SECTION 4.2. Appointment, Removal and Resignation of Trustee.
(a) Subject to Section 4.2(c), the Trustee may be appointed or removed
without cause at any time by the Guarantor.
(b) Subject to Section 4.2(c), the Trustee may be removed at any time
by Act of the Holders of a Majority in Liquidation Value of the Preferred
Securities, delivered to the Trustee and to the Guarantor.
(c) The Trustee shall not be removed pursuant to Section 4.2(a) or (b)
until a Successor Trustee has been appointed and has accepted such appointment
by written instrument executed by such Successor Trustee and delivered to the
Guarantor.
(d) The Trustee appointed to office shall hold office until a Successor
Trustee shall have been appointed or until its removal or registration. The
Trustee may resign from office (without need for prior or subsequent accounting)
by an instrument in writing executed by the Trustee and delivered to the
Guarantor, which resignation shall not take effect until a Successor Trustee has
been appointed and has accepted such appointment by instrument in writing
executed by such Successor Trustee and delivered to the Guarantor and the
resigning Trustee.
(e) If no Successor Trustee shall have been appointed and accepted
appointment as provided in this Section 4.2 within 60 days after delivery to the
Guarantor of an instrument of resignation, the resigning Trustee may petition
any court of competent jurisdiction for appointment of a Successor Trustee. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor Trustee.
(f) No Trustee shall be liable for the acts or omissions to act of any
of any Successor Trustee.
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ARTICLE V
---------
GUARANTEE
---------
SECTION 5.1. Guarantee. The Guarantor irrevocably and unconditionally
agrees to pay in full to the Holders the Guarantee Payments (without duplication
of amounts theretofore paid by the Issuer), as and when due, regardless of any
defense, right of set-off or counterclaim which the Issuer may have or assert
other than the defense of payment. The Guarantor's obligation to make a
Guarantee Payment may be satisfied, in the Guarantor's sole discretion, by
direct payment of the required amounts by the Guarantor to the Holders or by
causing the Issuer or any other person to pay such amounts to the Holders.
SECTION 5.2. Waiver of Notice and Demand. The Guarantor hereby waives
notice of acceptance of this Parent Guarantee Agreement and of any liability to
which it applies or may apply presentment, demand for payment, any right to
require a proceeding first against the Issuer or any other Person before
proceeding against the Guarantor, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.
SECTION 5.3. Obligations Not Affected. The obligation of the Guarantor
to make the Guarantee Payments under this Parent Guarantee Agreement shall in no
way be affected or impaired by reason of the happening from time to time of any
of the following:
(a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the Issuer of any express or
implied agreement, covenant, term or condition relating to the
Preferred Securities to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all
or any portion of the Distributions, Redemption Price, Liquidation
Distribution or any other sums payable under the terms of the Preferred
Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Preferred
Securities (other than an extension of time for payment of
Distributions that results from the extension of any interest payment
period on the KDSM Senior Debentures permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Holders pursuant to the
terms of the Preferred Securities,
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or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings
affecting, the Issuer or any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the
Preferred Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred;
(g) the making of any payments under the Parent Preferred or
the KDSM Senior Debentures; or
(h) any other circumstance (including any statute of
limitations) whatsoever that might otherwise constitute a legal or
equitable discharge or defense of a guarantor other than the defense of
payment, it being the intent of this Section 5.3 that the obligations
of the Guarantor hereunder shall be absolute and unconditional under
any and all circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4. Rights of Holders. The Guarantor expressly acknowledges
that: (i) this Parent Guarantee Agreement will be deposited with the Trustee to
be held for the benefit of the Holders of the Preferred Securities; (ii) the
Trustee has the right to enforce this Parent Guarantee Agreement on behalf of
the Holders of the Preferred Securities; (iii) the Holders of a Majority in
Liquidation Value of the Preferred Securities have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee in respect of this Parent Guarantee Agreement or exercising any trust or
power conferred upon the Trustee under this Parent Guarantee Agreement; and (iv)
if the Trustee fails to enforce this Parent Guarantee Agreement, any Holder of
the Preferred Securities may institute a legal proceeding directly against the
Guarantor to enforce its rights under this Parent Guarantee Agreement, without
first instituting a legal proceeding against the Issuer, the Trustee or any
other person or entity. The Guarantor waives any right or remedy to require that
any action be brought first against the Issuer or any Person before proceeding
directly against the Guarantor.
15
SECTION 5.5. Guarantee of Payment. This Parent Guarantee Agreement
creates a guarantee of payment of the Guarantee Payments to the limited extent
described in Section 5.1 and not of collection or performance of non-payment
covenants. This Parent Guarantee Agreement will not be discharged except by
payment of the Guarantee Payments in full (without duplication).
SECTION 5.6. Subrogation. The Guarantor shall be subrogated to any and
all rights of the Holders of Preferred Securities against the Issuer in respect
of any amounts paid to the Holders by the Guarantor under this Parent Guarantee
Agreement; provided, however, that the Guarantor shall not be entitled to
enforce or exercise any rights which it may acquire by way of subrogation or any
indemnity, reimbursement or other agreement, in all cases as a result of payment
under this Parent Guarantee Agreement unless and until all of amounts and
preferences owing to the holders of the Preferred Securities are paid in full
and are no longer outstanding or if any amounts are due and unpaid under this
Parent Guarantee Agreement. If any amount shall be paid to the Guarantor in
violation of the preceding sentence, the Guarantor agrees to hold such amount in
trust for the Holders and to pay over such amount to the Holders.
SECTION 5.7. Independent Obligations. The Guarantor acknowledges that
its obligations hereunder are independent of the obligations of the Issuer with
respect to the Preferred Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Parent Guarantee Agreement notwithstanding the occurrence of any
event referred to in subsections (a) through (g), inclusive, of Section 5.3
hereof.
ARTICLE VI
----------
LIMITATION OF TRANSACTIONS; SUBORDINATION
-----------------------------------------
SECTION 6.1. Limitation of Transactions. So long as any Preferred
Securities remain outstanding, if there shall have occurred an Event of Default
or an event of default under the Trust Agreement, then the Guarantor shall not
declare or pay any dividend on, make any distributions with respect to, or
redeem, purchase, acquire of make a liquidation payment with respect to, any of
its capital stock (other than (i) purchases or acquisitions of shares of common
stock in connection with the satisfaction by the Guarantor of its obligations
under any employee benefit plans, or (ii) as a result of a reclassification of
the Guarantor's capital stock or the exchange or conversion of one class or
series of the Guarantor's capital stock for another class or series of the
Guarantor's capital stock) or make any guarantee payments with respect to the
foregoing.
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SECTION 6.2. Subordination. This Parent Guarantee Agreement will
constitute an unsecured obligation of the Guarantor and will rank (i) senior to
any class or series of the Guarantor's preferred stock and common stock and (ii)
subordinate and junior in right of payment to all Indebtedness and liabilities
of the Guarantor (excluding trade payables and other liabilities that may be
made pari passu with or subordinate to the Guarantee Payments expressly by their
terms), and, therefore, no payments shall be required to be made under this
Parent Guarantee Agreement so long as there shall be a default or event of
default under any such Indebtedness or such payments will create a default or
event of default under any Indebtedness or any other liabilities of the
Guarantor (other than liabilities that are pari passu with of subordinate to the
Guarantee Payments expressly by their terms).
ARTICLE VII
-----------
TERMINATION
-----------
SECTION 7.1. Termination. This Parent Guarantee Agreement shall
terminate and be of no further force and effect upon: (i) full payment of the
Redemption Price of all Preferred Securities or (ii) the distribution of the
KDSM Senior Debentures to Holders of Preferred Securities in accordance with the
Trust Agreement upon liquidation of the Issuer or (iii) upon full payment of the
amounts payable in accordance with the Trust Agreement upon liquidation of the
Issuer. Notwithstanding the foregoing, this Parent Guarantee Agreement will
continue to be effective or will be reinstated, as the case may be, if at any
time any Holder must restore payment of any sums paid with respect to Preferred
Securities or under this Parent Guarantee Agreement.
ARTICLE VIII
------------
MISCELLANEOUS
-------------
SECTION 8.1. Successors and Assigns. All guarantees and agreements
contained in this Parent Guarantee Agreement shall bind the successors, assigns,
receivers, trustees and representatives of the Guarantor and shall inure to the
benefit of the Holders of the Preferred Securities then outstanding. Except in
connection with a consolidation, merger or sale involving the Guarantor that is
permitted under Article Eight of the Indenture, the Guarantor shall not assign
its obligations hereunder.
SECTION 8.2. Amendments. Except with respect to any changes which do
not adversely affect the rights of Holders (in which case no consent of Holders
will be required) and for which an opinion of counsel of the Trustee has been
received stating that such changes do not adversely affect the rights of
Holders,
17
the terms of this Parent Guarantee Agreement may only be amended with the prior
approval of the Holders of not less than a Majority in Liquidation Value of the
Preferred Securities. The provisions of Article Six of the Trust Agreement
concerning meetings of Holders shall apply to the giving of such approval.
SECTION 8.3. Notices. Any notice, request or other communication
required or permitted to be given hereunder shall be in writing, duly signed by
the party giving such notice, and delivered, telecopied or mailed by first class
mail as follows:
(a) if given to the Guarantor, to the address set forth below
or such other address as the Guarantor may give notice of to the
Holders of the Preferred Securities:
▇▇▇▇▇▇▇▇ Broadcast Group, Inc.
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
and a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
(b) if given to the Issuer, in care of the Trustee, at the
Issuer's (and the Trustee's) address set forth below or such other
address as the Trustee on behalf of the Issuer may give notice of to
the Holders of the Preferred Securities:
▇▇▇▇▇▇▇▇ Capital
c/▇ ▇▇▇▇▇▇▇▇ Broadcast Group, Inc.
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
18
and a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
with a copy to:
First Union National Bank of Maryland
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
Attention: Corporate Trust Department
(c) if given to any Holder of Preferred Securities, at the
address set forth on the books and records of the Issuer.
All notices hereunder shall be deemed to have been given when received
in person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered on
the date of such refusal or inability to deliver.
SECTION 8.4. Benefit. This Parent Guarantee Agreement is solely for the
benefit of the Holders of the Preferred Securities and, subject to Section
3.1(a), is not separately transferable from the Preferred Securities.
SECTION 8.5. No Benefit to Creditors of Trust. The rights under this
Parent Guarantee Agreement will not inure to the benefit of any creditors of the
Trust for any purposes whatsoever.
SECTION 8.6. Interpretation. In this Parent Guarantee Agreement, unless
the context otherwise requires:
(a) Capitalized terms used in this Parent Guarantee Agreement
but not defined in the preamble hereto have the respective meanings
assigned to them in Section 1.1;
(b) a term defined anywhere in this Parent Guarantee Agreement
has the same meaning throughout;
(c) all references to "the Parent Guarantee Agreement" or
"this Parent Guarantee Agreement" are to this Parent Guarantee
Agreement as modified, supplemented or amended from time to time;
19
(d) all references in this Parent Guarantee Agreement to
Articles and Sections are to Articles and Sections of this Parent
Guarantee Agreement unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Parent Guarantee Agreement unless otherwise
defined in this Parent Guarantee Agreement or unless the context
otherwise requires;
(f) a reference to the singular includes the plural and vice
versa; and
(g) the masculine, feminine or neuter genders used herein
shall include the masculine, feminine and neuter genders.
SECTION 8.7. Governing Law. THIS PARENT GUARANTEE AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
THIS PARENT GUARANTEE AGREEMENT is executed as of the day and year
first above written.
▇▇▇▇▇▇▇▇ BROADCAST GROUP, INC., as
Guarantor
By:
----------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: PRESIDENT
FIRST UNION NATIONAL BANK OF MARYLAND,
as Trustee
By:
-----------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title:
20
CROSS-REFERENCE TABLE*/
Section of Section of
Trust Indenture Act Guarantee
of 1939, as amended Agreement
310(a)....................... 4.1(a)
310(b)....................... 4.1(c), 2.7
310(c)....................... Inapplicable
311(a)....................... 2.2(b)
311(b)....................... 2.2(b)
311(c)....................... Inapplicable
312(a)....................... 2.2(a)
312(b)....................... 2.2(b)
313.......................... 2.3
314(a)....................... 2.4
314(b)....................... Inapplicable
314(c)....................... 2.5
314(d)....................... Inapplicable
314(e)....................... 1.1, 2.5, 3.2
314(f)....................... 2.1, 3.2
315(a)....................... 3.1(d)
315(b)....................... 2.7
315(c)....................... 3.1
315(d)....................... 3.1(d)
316(a)....................... 5.4(iii), 2.6
316(b)....................... 5.1
316(c)....................... 2.2
317(a)....................... Inapplicable
317(b)....................... Inapplicable
318(a)....................... 2.1(b)
318(b)....................... 2.1
318(c)....................... 2.1(a)
------------------
*/This Cross-Reference Table does not constitute part of the Parent
Guarantee Agreement and shall not affect the interpretation of any of
its terms or provisions.
21