Exhibit 10.2
FIRST AMENDMENT TO SECOND LIEN CREDIT AGREEMENT
This First Amendment (this “Amendment”) to Second Lien Credit Agreement is
entered into as of November 7, 2011 (the “First Amendment Effective Date”), by
and among WESTWOOD ONE, INC., a Delaware corporation (the “Borrower”), and the
Lenders party hereto.
RECITALS
WHEREAS, reference is made to that certain Second Lien Credit Agreement, dated
as of October 21, 2011 (as amended, restated, supplemented or otherwise modified
from time to time, the “Credit Agreement”; capitalized terms used but not
defined herein have the meanings given to such terms in the Credit Agreement),
among the Borrower, Cortland Capital Market Services LLC, as Administrative
Agent and Collateral Agent, Macquarie Capital (USA) Inc., as Syndication Agent,
and the Lenders party thereto;
WHEREAS, the Borrower wishes to amend the Credit Agreement as set forth herein;
WHEREAS, the Required Lenders have agreed to amend the Credit Agreement upon the
terms and subject to the conditions set forth herein.
NOW THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the parties hereto hereby agree as follows:
Section 1. Section References. Unless otherwise expressly stated herein, all
Section references herein shall refer to Sections of the Credit Agreement.
Section 2. Amendment to Section 1.1. Section 1.1 is hereby amended by:
(a) amending the definition of “Excess Cash Flow” by deleting clause (b)(i)
thereof and replacing it with the following:
“(i) any cash principal payment on the Term Loans and on the First Lien Loans
during such period (but only, in the case of payment in respect of First Lien
Revolving Loans or First Lien Swing Loans, to the extent that the Revolving
Credit Commitments (as defined in the First Lien Credit Agreement) are
permanently reduced by the amount of such payment) other than (x) any voluntary
prepayment of Term Loans made pursuant to Section 2.7 hereof during such period
or First Lien Term Loans, First Lien Revolving Loans or First Lien Swing Loans
pursuant to Section 2.7 of the First Lien Credit Agreement during such period
and (y) any mandatory prepayment required pursuant to Section 2.8(a) hereof or
Section 2.8(a) of the First Lien Credit Agreement, in either case because of the
existence of Excess Cash Flow and any purchase and retirement of First Lien Term
Loans by any Purchasing Borrower Party (as defined in the First Lien Credit
Agreement) pursuant to Section 2.21 of the First Lien Credit Agreement,”

 

 

--------------------------------------------------------------------------------

 

(b) deleting the definition of “Permitted Acquisition” and replacing it with the
following:
“Permitted Acquisition” means any Proposed Acquisition satisfying each of the
following conditions: (a) the aggregate amounts payable in connection with, and
other consideration for (in each case, including all transaction costs and all
Indebtedness, liabilities and Guaranty Obligations incurred or assumed in
connection therewith or otherwise reflected in a Consolidated balance sheet of
the Borrower and the Proposed Acquisition Target but excluding any portion of
such consideration (x) comprised of Qualified Stock or (y) funded with Net Cash
Proceeds of any issuances of Qualified Stock, in each case of clauses (x) and
(y), to the extent that the Consolidated Leverage Ratio, measured on a Pro Forma
Basis immediately after giving effect to such Proposed Acquisition, as of the
last day of the most recently ended Fiscal Quarter or Fiscal Year (in the case
of the fourth Fiscal Quarter) for which Financial Statements have been or were
required to be delivered pursuant to Section 6.1 is less than the Consolidated
Leverage Ratio as of the last day of the most recently ended Fiscal Quarter or
Fiscal Year (in the case of the fourth Fiscal Quarter) for which Financial
Statements have been or were required to be delivered pursuant to Section 6.1
(without giving pro forma effect to such Proposed Acquisition)) (i) such
Proposed Acquisition shall not exceed, in the aggregate with any Indebtedness
incurred in connection with such Proposed Acquisition pursuant to
Section 8.1(n), $27,500,000 and (ii) such Proposed Acquisition and all other
Permitted Acquisitions consummated on or prior to the date of the consummation
of such Proposed Acquisition shall not exceed, in the aggregate with any
Indebtedness incurred on or prior to such date pursuant to Section 8.1(n),
$55,000,000, (b) the Syndication Agent shall have received reasonable advance
notice of such Proposed Acquisition including a reasonably detailed description
thereof at least 15 Business Days prior to the consummation of such Proposed
Acquisition (or such later date as may be agreed by the Syndication Agent) and
on or prior to the date of such Proposed Acquisition, the Syndication Agent
shall have received copies of the acquisition agreement and related Contractual
Obligations and other documents (including financial information and analysis,
environmental assessments and reports, opinions, certificates, lien searches,
and FCC approvals) and information reasonably requested by the Syndication
Agent, (c) as of the date of consummation of any transaction as part of such
Proposed Acquisition and after giving effect to all transactions to occur on
such date as part of such Proposed Acquisition, the representations and
warranties set forth in any Loan Document shall be true and correct in

 

2

--------------------------------------------------------------------------------

 

all material respects (but in all respects if such representation or warranty is
qualified by “material” or “Material Adverse Effect”) on and as of such date or,
to the extent such representations and warranties expressly relate to an earlier
date, on and as of such earlier date, (d) after giving effect to such Permitted
Acquisition, the Borrower shall be in compliance with the financial covenants
set forth in Article 5 on a Pro Forma Basis as of the last day of the most
recently ended Fiscal Quarter or Fiscal Year (in the case of the fourth Fiscal
Quarter) for which Financial Statements have been or were required to be
delivered pursuant to Section 6.1 (assuming that the maximum permitted
Consolidated Leverage Ratio permitted at such time was in fact 0.25 to 1 less
than the ratio set forth in Section 5.1 for such period), (e) no Default or
Event of Default is continuing or would result therefrom, (f) the Proposed
Acquisition Target has Consolidated EBITDA, subject to pro forma adjustments
reasonably acceptable to the Syndication Agent, for the most recent four fiscal
quarters prior to the date of such Proposed Acquisition for which financial
statements are available, greater than zero and (g) after giving effect to such
Permitted Acquisition, the sum of (x) unencumbered (except for encumbrances
created by the Loan Documents and the First Lien Loan Documents) cash and Cash
Equivalents held by the Borrower and its Subsidiaries at such time, plus (y) the
aggregate Revolving Credit Commitments (as defined in the First Lien Credit
Agreement) of all the First Lien Lenders then in effect minus (z) the Revolving
Credit Outstandings (as defined in the First Lien Credit Agreement) of all the
First Lien Lenders at such time, shall not be less than $10,000,000.”
(c) amending the definition of “Pro Forma Basis” by adding the following
sentence at the end of such definition:
“Any adjustments to Consolidated EBITDA pursuant to this definition as a result
of or in connection with a Permitted Acquisition shall not exceed 25% of the
Consolidated EBITDA of the Proposed Acquisition Target.”
Section 3. Conditions Precedent. The effectiveness of this Amendment is subject
to the satisfaction of each of the following conditions precedent:
(a) Administrative Agent shall have received all of the following:
(i) Amendment. This Amendment, duly executed and delivered by each Loan Party
and the Required Lenders; and
(ii) First Lien Credit Agreement Amendment. (A) A copy of the amendment to the
First Lien Credit Agreement being entered into by the Loan Parties and the
Required Lenders (as defined in the First Lien Credit Agreement) that is
substantially similar to this Amendment and (B) evidence that such amendment has
been executed and delivered and is in full force and effect on or prior to the
First Amendment Effective Date; and

 

3

--------------------------------------------------------------------------------

 

(iii) Fees and Expenses. To the extent invoiced, the fees, expenses and other
amounts payable on or prior to the First Amendment Effective Date referred to
(and subject to the limitations) in Section 11.3 of the Credit Agreement and in
the section titled “Costs and Expenses of the Agents” below, including, but not
limited to, reimbursement or payment of all reasonable and out-of-pocket
expenses (including the reasonable legal fees and expenses of Latham & Watkins
LLP, special counsel to the Syndication Agent) required to be reimbursed or paid
by the Borrower hereunder or under any other Loan Document.
(b) Representations and Warranties. After giving effect to this Amendment, the
representations and warranties contained herein and in the other Loan Documents
shall be true and correct in all material respects (but in all respects if such
representation or warranty is qualified by “material” or “Material Adverse
Effect”) on and as of the First Amendment Effective Date to the same extent as
though made on and as of that date, except to the extent such representations
and warranties expressly relate to an earlier date, in which case such
representations and warranties shall have been true and correct in all material
respects (but in all respects if such representation or warranty is qualified by
“material” or “Material Adverse Effect”) on and as of such earlier date.
(c) Completion of Proceedings. All partnership, corporate, limited liability
company and other proceedings taken or to be taken in connection with the
transactions contemplated hereby and with the transactions contemplated by the
concurrent amendment to the First Lien Credit Agreement and all documents
incidental hereto and thereto shall be reasonably satisfactory in form and
substance to the Syndication Agent and its counsel, and the Syndication Agent
and such counsel shall have received copies of such documents as the Syndication
Agent may reasonably request.
(d) No Default. On the First Amendment Effective Date, no event shall have
occurred and be continuing that would constitute an Event of Default or a
Default after giving effect to this Amendment.
(e) Assignment. Term Loans in the amount of no less than $42,500,000 shall have
been assigned by MIHI LLC to a Lender that has been previously disclosed to the
Borrower in accordance with the provisions of the Credit Agreement and evidence
of such assignment shall have been delivered to the Borrower.

 

4

--------------------------------------------------------------------------------

 

Section 4. Representations and Warranties; Reaffirmation of Grant. Each Loan
Party hereby represents and warrants to the Agents and the Lenders that, as of
the First Amendment Effective Date after giving effect to this Amendment,
(a) all representations and warranties of the Loan Parties set forth in the
Credit Agreement and in any other Loan Document are true and correct in all
material respects (but in all respects if such representation or warranty is
qualified by “material” or “Material Adverse Effect”) on and as of the First
Amendment Effective Date to the same extent as though made on and as of such
date, except to the extent such representations and warranties expressly relate
to an earlier date, in which case such representations and warranties shall have
been true and correct in all material respects (but in all respects if such
representation or warranty is qualified by “material” or “Material Adverse
Effect”) on and as of such earlier date, (b) no Default or Event of Default has
occurred and is continuing, (c) the Credit Agreement (as amended by this
Amendment) and all other Loan Documents are and remain legally valid, binding
obligations of the Loan Parties, enforceable against each such Loan Party in
accordance with their respective terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors’ rights generally or by equitable principles relating to
enforceability and (d) each of the Loan Documents to which such Loan Party is a
party pursuant to which a Lien has been granted in favor of the Administrative
Agent and all of the Collateral described therein do and shall continue to
secure the payment of all Obligations as set forth in such respective Loan
Documents. Each Loan Party that is a party to the Guaranty and Security
Agreement or any of the Loan Documents pursuant to which a Lien has been granted
in favor of the Administrative Agent hereby reaffirms its grant of a security
interest in the Collateral to the Administrative Agent for the ratable benefit
of the Secured Parties, as collateral security for the prompt and complete
payment and performance when due of the Obligations.
Section 5. Survival of Representations and Warranties. All representations and
warranties made in this Amendment or any other Loan Document shall survive the
execution and delivery of this Amendment, and no investigation by any Agent or
the Lenders shall affect the representations and warranties or the right of the
Agents and the Lenders to rely upon them.
Section 6. Reference to Agreement. The Credit Agreement is hereby amended so
that any reference in the Loan Documents to the Credit Agreement, whether direct
or indirect, shall mean a reference to the Credit Agreement as amended hereby.
This Amendment shall constitute a Loan Document under the Credit Agreement.
Section 7. Costs and Expenses of the Agents. The Borrower shall pay on demand
all reasonable out-of-pocket and documented costs and expenses of the Agents
(including the reasonable fees, costs and expenses of counsel to the Agents)
incurred in connection with the preparation, execution and delivery of this
Amendment, but only to the extent required pursuant to Section 11.3 of the
Credit Agreement.
Section 8. Governing Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HERETO SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES THAT WOULD RESULT IN THE APPLICATION OF ANY LAW OTHER THAN THE STATE
OF NEW YORK.
Section 9. Execution. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page to this Amendment by telecopier (or electronic
mail (in PDF format)) shall be effective as delivery of a manually executed
counterpart of this Amendment.

 

5

--------------------------------------------------------------------------------

 

Section 10. Limited Effect. This Amendment relates only to the specific matters
expressly covered herein, shall not be considered to be a waiver of any rights,
claims or remedies any Lender may have under the Credit Agreement or under any
other Loan Document (except as expressly set forth herein) or under applicable
law, and shall not be considered to create a course of dealing or to otherwise
obligate in any respect any Lender to execute similar or other amendments or
grant any waivers under the same or similar or other circumstances in the
future.
Section 11. Ratification by Guarantors. Each of the Guarantors acknowledges that
its consent to this Amendment is not required, but each of the undersigned
nevertheless does hereby agree and consent to this Amendment and to the
documents and agreements referred to herein. Each of the Guarantors agrees and
acknowledges that (i) notwithstanding the effectiveness of this Amendment, such
Guarantor’s guaranty under the Guaranty and Security Agreement shall remain in
full force and effect without modification thereto and (ii) nothing herein shall
in any way limit any of the terms or provisions of such Guarantor’s guaranty or
any other Loan Document executed by such Guarantor (as the same may be amended
from time to time), all of which are hereby ratified, confirmed and affirmed in
all respects. Each of the Guarantors hereby agrees and acknowledges that no
other agreement, instrument, consent or document shall be required to give
effect to this section. Each of the Guarantors hereby further acknowledges that
the Borrower, the Agents and any Lender may from time to time enter into any
further amendments, modifications, terminations and/or waivers of any provisions
of the Loan Documents without notice to or consent from such Guarantor and
without affecting the validity or enforceability of such Guarantor’s guaranty or
giving rise to any reduction, limitation, impairment, discharge or termination
of such Guarantor’s guaranty.
[signature pages follow]

 

6

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

            WESTWOOD ONE, INC.
      By:   /s/ Spencer Brown         Name:   Spencer Brown        Title:  
Chief Executive Officer        WESTWOOD ONE PROPERTIES, INC.
WESTWOOD ONE STATIONS — NYC, INC.
WESTWOOD ONE RADIO, INC.
WESTWOOD ONE RADIO NETWORKS, INC.
WESTWOOD NATIONAL RADIO CORPORATION
VERGE MEDIA COMPANIES, LLC
VERGE MEDIA GROUP HOLDINGS, INC.
VERGE MEDIA INTERMEDIATE HOLDINGS, INC.
VERGE MEDIA, INC.
VERGE MEDIA SOLUTIONS, LLC
EXCELSIOR RADIO NETWORKS, LLC
EXBT, LLC
DIAL COMMUNICATIONS GLOBAL MEDIA, LLC
EXCELSIOR NETWORK GROUP, LLC
RDG EXCELSIOR HOLDINGS, LLC
EXCELSIORTM, INC.
EXCELSIOR MEDIA NETWORKS, LLC
JPN, LLC
EXCELSIOR RADIO NETWORK VENTURES, LLC
EXCELSIOR RADIO HOLDINGS, LLC
EXCELSIOR MEDIAAMERICA, INC.
DG RADIO NETWORKS, LLC
AMERICAN COMEDY NETWORK, LLC,
as Guarantors
      By:   /s/ Spencer Brown         Name:   Spencer Brown        Title:  
Chief Executive Officer   

Westwood One 2nd Lien First Amendment Signature Page

 

--------------------------------------------------------------------------------

 

            MIHI LLC, as a Lender
      By:   /s/ Andrew Stock         Name:   Andrew Stock        Title:  
Authorized Signatory            By:   /s/ Kevin Smith         Name:   Kevin
Smith        Title:   Authorized Signatory   

Westwood One 2nd Lien First Amendment Signature Page

 

--------------------------------------------------------------------------------

 

                      BLACKROCK KELSO CAPITAL CORPORATION,
as a Lender    
 
                    By:   BlackRock Kelso Capital Advisors LLC, its
Investment Advisor    
 
               
 
      By:   /s/ Michael B. Lazar
 
Name: Michael B. Lazar    
 
          Title: Chief Operating Officer    

Westwood One 2nd Lien First Amendment Signature Page