Exhibit 10.4

 

EXECUTION VERSION

 

U.S.$650,000,000

 

CREDIT AGREEMENT

 

Dated as of May 3, 2009

 

Between

 

GREENLADY CORP.

 

as Borrower

 

and

 

THE DIRECTV GROUP, INC.

 

as Lender

 

 

 

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

Table of Contents

Page

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

1

 

SECTION 1.01.

Certain Defined Terms

1

 

SECTION 1.02.

Computation of Time Periods

6

ARTICLE II

AMOUNTS AND TERMS OF THE ADVANCES

7

 

SECTION 2.01.

The Advances

7

 

SECTION 2.02.

Making the Advances

7

 

SECTION 2.03.

Repayment

7

 

SECTION 2.04.

Interest

7

 

SECTION 2.05.

[Reserved.]

8

 

SECTION 2.06.

Optional Prepayments

8

 

SECTION 2.07.

Illegality

8

 

SECTION 2.08.

Payments and Computations

8

 

SECTION 2.09.

Taxes

9

 

SECTION 2.10.

Use of Proceeds

9

 

SECTION 2.11.

Evidence of Debt

10

ARTICLE III

CONDITIONS TO EFFECTIVENESS AND LENDING

10

 

SECTION 3.01.

Conditions Precedent to Effectiveness of Section 2.01

10

 

SECTION 3.02.

Conditions Precedent to Each Borrowing

11

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

12

 

SECTION 4.01.

Representations and Warranties of the Borrower

12

ARTICLE V

COVENANTS OF THE BORROWER

13

 

SECTION 5.01.

Affirmative Covenants

13

 

SECTION 5.02.

Negative Covenants

14

ARTICLE VI

EVENTS OF DEFAULT

15

 

SECTION 6.01.

Events of Default

15

ARTICLE VII

MISCELLANEOUS

16

 

SECTION 7.01.

Amendment, Etc

16

 

SECTION 7.02.

Notices, Etc

16

 

SECTION 7.03.

No Waiver; Remedies

16

 

SECTION 7.04.

Costs and Expenses

16

 

 

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

 

SECTION 7.05.

Right of Set-off

17

 

SECTION 7.06.

Binding Effect

17

 

SECTION 7.07.

Assignments and Participations

17

 

SECTION 7.08.

Severability

18

 

SECTION 7.09.

Electronic Execution of Assignments

18

 

SECTION 7.10.

Governing Law

18

 

SECTION 7.11.

Execution in Counterparts

18

 

SECTION 7.12.

Jurisdiction; Waiver of Immunities

18

 

SECTION 7.13.

Waiver of Jury Trial

19

 

Exhibits

Exhibit A - Form of Promissory Note

Exhibit B - Form of Notice of Borrowing

Exhibit C - Form of Assignment and Acceptance

Exhibit D - Form of Legal Opinion

Exhibit E - Form of Pledge Agreement

 

 

 

 

 

 

 

 

 

 

 

 

ii

 

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

CREDIT AGREEMENT

This Credit Agreement, dated as of May 3, 2009 (this “Agreement”), is entered
into by and between Greenlady Corp., a Delaware corporation (the “Borrower”),
and The DIRECTV Group, Inc., a Delaware corporation (“DTV”), as Lender (as
hereinafter defined).

PRELIMINARY STATEMENTS:

 

A.        The Borrower is a wholly owned subsidiary of Liberty Entertainment,
Inc. (“LEI”), and LEI has been formed for the purpose of receiving and holding
certain of the assets and liabilities attributed to Liberty Media Corporation’s
(“LMC”) Liberty Entertainment group.

 

B.

LEI is a wholly-owned subsidiary of LMC.

C.        In accordance with the Reorganization Agreement (as hereinafter
defined) to which LEI and LMC are parties and the Restated Certificate of
Incorporation of LMC, LMC will effect the redemption of 90% of the issued and
outstanding shares of LMC’s Liberty Entertainment common stock for all of the
issued and outstanding shares of common stock of LEI, subject to the conditions
set forth in the Reorganization Agreement, with the effect that LEI and its
subsidiaries (including the Borrower) will be split-off (the “Split-Off”) from
LMC and cease to be wholly owned subsidiaries of LMC.

D.        Greenlady II, LLC, a Delaware limited liability company and a wholly
owned subsidiary of the Borrower (“Greenlady II”), is party to that certain
Collar Transaction (as defined below).

E.        To provide Greenlady II with a source of financing to meet its
obligations under the Collar Transaction and the BOA Credit Agreement (as
defined below) after the Spit-Off, and to provide the Borrower with a source of
financing to refinance certain advances under the LMC Credit Agreement, the
Borrower has requested that DTV establish this credit facility pursuant to which
the Borrower may obtain loans in the aggregate principal amount at any time
outstanding not to exceed U.S. $650,000,000.

In consideration of the foregoing recitals, the mutual agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto, intending to be bound
legally, agree as follows:

ARTICLE I

 

DEFINITIONS AND ACCOUNTING TERMS

SECTION 1.01. Certain Defined Terms. As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):

“Advance” has the meaning specified in Section 2.01.

“Affiliate” means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term “control” (including the terms “controlling”, “controlled
by” and “under common control with”) of a Person means the possession, direct or
indirect, of the power to

 

 

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

vote 50% or more of the Voting Stock of such Person or to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of Voting Stock, by contract or otherwise. For purposes of this
Agreement, DIRECTV shall be deemed to not be an Affiliate of the Borrower.

“Applicable Margin” means 5.0% per annum.

“Assignment and Acceptance” means an assignment and acceptance entered into by
the Lender and an assignee of the Lender in substantially the form of Exhibit C
hereto.

“Bank of America” means Bank of America, N.A.

“BOA Credit Agreement” means that certain Credit Agreement, dated as of April 9,
2008, between Greenlady II and Bank of America.

“Borrowing” means a borrowing consisting of an Advance made by the Lender
pursuant to Section 2.01.

‘‘Business Day” means a day of the year on which banks are not required or
authorized by law to close in New York City and, if the applicable Business Day
relates to the Advances, on which dealings are carried on in the London, England
interbank market.

“Collar Agreement” has the meaning specified in the definition of “Collar
Transaction.”

“Collar Transaction” means (i) the six distinct Components (a) initially
specified in (and defined under) the Transaction Acknowledgement and (b)
thereafter as evidenced by a Master Confirmation and six Supplemental
Confirmations, each dated April 9, 2008, between Greenlady II and Bank of
America, each subject to an agreement in the form of an ISDA Master Agreement
entered into between Greenlady II and Bank of America for the purposes of
replacing and superseding the Transaction Acknowledgement (such documentation,
including any Credit Support Annex subject to such ISDA Master Agreement, the
“Collar Agreement”) and (ii) the Parent Guarantee entered into in connection
therewith.

“Collateral” has the meaning assigned to such term in the Pledge Agreement.

“Commitment” means U.S.$650,000,000, as such amount may be reduced from time to
time in accordance with the terms hereof.

“Consolidated” refers to the consolidation of accounts in accordance with GAAP.

“Debt” of any Person means, without duplication, (a) all indebtedness of such
Person for borrowed money, (b) all obligations of such Person for the deferred
purchase price of property or services (other than trade payables not overdue by
more than 60 days incurred in the ordinary course of such Person’s business),
(c) all obligations of such Person, evidenced by notes, bonds, debentures or
other similar instruments, (d) all obligations of such Person created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though 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), (e) all obligations of such Person as
lessee under leases that have been or should be, in accordance with GAAP,
recorded as capital leases, (f) all obligations, contingent or otherwise, of
such Person in respect of acceptances, letters of credit or similar extensions
of credit, (g) all

 

 

2

 

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

obligations of such Person in respect of Hedge Agreements, (h) all obligations
of such Person to purchase, redeem, retire, defease or otherwise make any
payment in respect of any equity interests in such Person or any other Person or
any warrants, rights or options to acquire such equity interests, (i) all Debt
of others referred to in clauses (a) through (h) above or clause (j) below and
other payment obligations (collectively, “Guaranteed Debt”) guaranteed directly
or indirectly in any manner by such Person, or in effect guaranteed directly or
indirectly by such Person through an agreement (1) to pay or purchase such
Guaranteed Debt or to advance or supply funds for the payment or purchase of
such Guaranteed Debt, (2) 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 Guaranteed Debt or to assure the holder of
such Guaranteed Debt against loss, (3) to supply funds to or in any other manner
invest in the debtor (including any agreement to pay for property or services
irrespective of whether such property is received or such services are rendered)
or (4) otherwise to assure a creditor against loss, and (j) all Debt referred to
in clauses (a) through (i) above (including Guaranteed Debt) secured by (or for
which the holder of such Debt has an existing right, contingent or otherwise, to
be secured by) any Lien on property (including accounts and contract rights)
owned by such Person, even though such Person has not assumed or become liable
for the payment of such Debt.

“Default” means any Event of Default or any event that would constitute an Event
of Default but for the requirement that notice be given or time elapse or both.

“DIRECTV” means DTV and its Subsidiaries.

“DTV Stock” means the common stock, par value $0.01 per share, of The DIRECTV
Group, Inc.

“DTV Stock Equivalent Amount” means, as of any date of determination, the number
of shares of DTV Stock (rounded to nearest whole number) equal to (i) the
aggregate principal amount of the Advances then outstanding, plus the accrued
and unpaid interest thereon, divided by (ii) the Average Price. “Average Price”
shall mean the arithmetic mean of the NASDAQ Official Closing Price as indicated
on Bloomberg Page “DTV.UQ <Equity> HP <GO>” (or any successor or replacement
page) or, if such price is not available, the closing price as reported in The
Wall Street Journal, of DTV Stock on each Wednesday (or, if such day is not a
Trading Day, on the first Trading Day immediately following such day) during the
six month period ending immediately prior to such date of determination.

“Effective Date” has the meaning specified in Section 3.01.

“Eurodollar Rate” means, for any Interest Period for any Advance, the interest
rate per annum equal to the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) appearing on Reuters Screen LIBOR01 Page (or any
successor page or substitute service providing quotations of interest rates
applicable to U.S. Dollar deposits in the London interbank market as designated
by the Lender from time to time) as the London interbank offered rate for
deposits in U.S. Dollars at 11:00 A.M. (London time) two Business Days before
the first day of such Interest Period for a maturity comparable to such Interest
Period; provided, however, if more than one rate is specified on such page, the
applicable rate shall be the arithmetic mean of all such rates; provided further
that, if for any reason such rate is not available, the term “Eurodollar Rate”
shall mean, for any Interest Period applicable to any Advance, the rate per
annum at which deposits of U.S. $5,000,000 are offered by the principal office
of Bank of America, N.A. in London, England to prime banks in the London
interbank market at 11:00 A.M. (London time) two Business Days before the first
day of such Interest Period for a maturity comparable to such Interest Period.

“Events of Default” has the meaning specified in Section 6.01.

 

 

3

 

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

“Existing Debt” has the meaning specified in Section 5.02(b).

“GAAP” means generally accepted accounting principles in the United States.

“Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state, provincial or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government (including any supra-national bodies such as the European Union or
the European Central Bank).

“Hedge Agreements” means interest rate swap, cap or collar agreements, interest
rate future or option contracts, currency swap agreements, currency future or
option contracts and other similar agreements.

“Interest Period” means, for each Advance, the period commencing on the date of
such Advance (or January 1, 2010, as applicable) and ending on the last day of
the one month period thereafter and, thereafter, each subsequent period
commencing on the last day of the immediately preceding Interest Period and
ending on the last day of the one month period thereafter; provided, however,
that:

(i)        whenever the last day of any Interest Period would otherwise occur on
a day other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day, provided, however, that,
if such extension would cause the last day of such Interest Period to occur in
the next following calendar month, the last day of such Interest Period shall
occur on the next preceding Business Day; and

(ii)       whenever the first day of any Interest Period occurs on a day of an
initial calendar month for which there is no numerically corresponding day in
the calendar month that succeeds such initial calendar month by the number of
months equal to the number of months in such Interest Period, such Interest
Period shall end on the last Business Day of such succeeding calendar month.

“ISDA” means the International Swaps and Derivatives Association, Inc.

“ISDA Master Agreement” means the printed form of the 1992 ISDA Master Agreement
(Multicurrency – Cross Border), including any Credit Support Annex subject
thereto, as published by ISDA.

“Lender” means DTVor any Person that shall become a party hereto pursuant to
Section 7.07.

“Lien” means any lien, security interest or other charge or encumbrance of any
kind, or any other type of preferential arrangement, including the lien or
retained security title of a conditional vendor and any easement, right of way
or other encumbrance on title to real property.

“LMC Credit Agreement” means that Revolving Credit Agreement, dated as of May 3,
2009 between Greenlady Corp. and Liberty Media Corporation.

“Loan Documents” means this Agreement, the Note, the Pledge Agreement and each
certificate, agreement or document executed by the Borrower and delivered to the
Lender in connection with or pursuant to any of the foregoing.

 

 

4

 

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

“Material Adverse Change” means any material adverse change in the business,
condition (financial or otherwise), operations or performance of the Borrower
and its Subsidiaries (including for this purpose DIRECTV) taken as a whole.

“Material Adverse Effect” means a material adverse effect on (a) the business,
condition (financial or otherwise), operations or performance of the Borrower
and its Subsidiaries (including for this purpose DIRECTV) taken as a whole, (b)
the rights and remedies of the Lender under this Agreement or any Note or (c)
the ability of the Borrower to perform its obligations under this Agreement or
any Note.

“Merger Agreement” means the Agreement and Plan of Merger, dated as of May 3,
2009, by and among LMC, LEI, DTV, DIRECTV, DTVG One, Inc. and DTVG Two, Inc.

“NASDAQ” means The NASDAQ Global Select Market, and any successor thereto.

“Note” means the promissory note of the Borrower payable to the order of the
Lender, in substantially the form of Exhibit A hereto, evidencing the aggregate
indebtedness of the Borrower to the Lender resulting from the Advances made by
the Lender.

“Notice of Borrowing” has the meaning specified in Section 2.02.

“Obligations” means the Advances and all other amounts, obligations, covenants
and duties owing by the Borrower to the Lender or any Indemnified Party, of
every type and description (whether by reason of an extension of credit, loan,
advance, indemnification or otherwise), present or future, arising under this
Agreement or any other Loan Document, whether direct or indirect (including
those acquired by assignment), absolute or contingent, due or to become due, now
existing or hereafter arising and however acquired and whether or not evidenced
by any note, guaranty or other instrument or for the payment of money, including
all fees, interest, charges, expenses, attorneys’ fees and disbursements and
other sums chargeable to the Borrower under this Agreement or any other Loan
Document.

“Parent Guarantee” means the Guaranty of Liberty Media LLC in favor of Bank of
America related to the Collar Transaction and dated as of April 2, 2008.

“Permitted Liens” means such of the following as to which no enforcement,
collection, execution, levy or foreclosure proceeding shall have been commenced:
(a) Liens for taxes, assessments and governmental charges or levies to the
extent not required to be paid under Section 5.0l(b) hereof; (b) Liens imposed
by law, such as materialmen’s, mechanics’, carriers’, workmen’s and repairmen’s
Liens and other similar Liens arising in the ordinary course of business
securing obligations that are not overdue for a period of more than 30 days; (c)
pledges or deposits to secure obligations under workers’ compensation laws or
similar legislation or to secure public or statutory obligations; and (d)
easements, rights of way and other encumbrances on title to real property that
do not render title to the property encumbered thereby unmarketable or
materially adversely affect the use of such property for its present purposes.

“Permitted Payments” has the meaning specified in Section 2.10.

“Permitted Refinancing” has the meaning specified in Section 2.10.

 

 

5

 

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

“Person” means an individual, partnership, corporation (including a business
trust), joint stock company, trust, unincorporated association, joint venture,
limited liability company or other entity, or a government or any Governmental
Authority.

“Pledge Agreement” means the Pledge Agreement to be entered into between the
Lender and the Borrower, in substantially the form attached hereto as Exhibit E.

“Reorganization Agreement” means the Reorganization Agreement to be entered into
by LEI and LMC in substantially the form attached as Exhibit B to the Merger
Agreement.

“Split-Off Effective Time” means the Effective Time at which the Redemption
occurs on the Redemption Date (as those terms are defined in the Reorganization
Agreement).

“Subsidiary” of any Person means any corporation, partnership, joint venture,
limited liability company, trust or estate of which (or in which) more than 50%
of (a) the issued and outstanding capital stock having ordinary voting power to
elect a majority of the Board of Directors of such corporation (irrespective of
whether at the time capital stock of any oilier class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such limited
liability company, partnership or joint venture or (c) the beneficial interest
in such trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person’s other Subsidiaries. For purposes
of this Agreement, DIRECTV and Greenlady II, LLC shall be deemed to not be
Subsidiaries of the Borrower except to the extent expressly set forth herein.

“Termination Date” means the earliest of (i) the date of termination of the
Commitment pursuant to Section 6.01, (ii) the date of termination of the Merger
Agreement pursuant to Section 9.1 thereof and (iii) the Closing Date (as defined
in the Merger Agreement).

“Trading Day” means any day on which NASDAQ is scheduled to be open for trading
for regular trading sessions and is open for trading during regular trading
sessions, notwithstanding NASDAQ closing prior to its scheduled closing time.

“Transaction Acknowledgement” means the Cashless Collar, Transaction
Acknowledgement, dated as of April 2, 2008, among Liberty Media LLC, Greenlady
II and Bank of America and regarding the collared share option transaction on
certain shares of DTV Stock between Bank of America and Greenlady II.

“United States” or “U.S.” means the United States of America.

“Unused Commitment” means, at any time, the Lender’s Commitment at such time
minus the aggregate principal amount of all Advances outstanding at such time.

“U.S. Dollars”, “U.S. $” and “$” means the lawful currency of the United States.

“Voting Stock” means capital stock issued by a corporation, or equivalent
interests in any other Person, the holders of which are ordinarily, in the
absence of contingencies, entitled to vote for the election of directors (or
persons performing similar functions) of such Person, even if the right so to
vote has been suspended by the happening of such a contingency.

SECTION 1.02. Computation of Time Periods. In this Agreement in the computation
of periods of time from a specified date to a later specified date, the word
“from” means “from and

 

 

6

 

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

including” and the words “to” and “until” each mean “to but excluding”.
References in this Agreement to any agreement or contract shall mean and be a
reference to such agreement or contract as amended, amended and restated,
supplemented or otherwise modified from time to time in accordance with its
terms to the extent such amendment, restatement, supplement or other
modification is not prohibited hereunder. In this Agreement, the words
“include,” “includes” and “including” shall be deemed to be followed by the
phrase “without limitation” and the word “will” shall be construed to have the
same meaning and effect as the word “shall.” Unless the context requires
otherwise, (a) any reference in this Agreement to any Person shall be construed
to include such Person’s successors and assigns, (b) the words “herein,”
“hereof” and “hereunder,” and words of similar import, when used in this
Agreement shall be construed to refer to this Agreement in its entirety and not
to any particular provision hereof, (c) all references in this Agreement to
Articles, Sections, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Exhibits and Schedules to, this Agreement, (d) any
reference to any law or regulation in this Agreement shall, unless otherwise
specified, refer to such law or regulation as amended, modified or supplemented
from time to time and (e) the words “asset” and “property” shall be construed to
have the same meaning and effect and refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.

ARTICLE II

 

AMOUNTS AND TERMS OF THE ADVANCES

SECTION 2.01. The Advances. The Lender agrees, on the terms and conditions
hereinafter set forth, to make advances (each an “Advance”) to the Borrower from
time to time on any Business Day during the period from the Effective Date until
the Termination Date in an amount for each such Advance not to exceed the
Lender’s Unused Commitment at such time; provided, however, that the aggregate
principal amount of all Advances by the Lender shall not exceed the Commitment.
Amounts borrowed under this Section 2.01 and prepaid pursuant to Section 2.06
may not be reborrowed under this Section 2.01.

SECTION 2.02. Making the Advances. Each Borrowing shall be made on notice, given
not later than 11:00 A.M. (New York City time) on the third Business Day prior
to the date of the proposed Borrowing, by the Borrower to the Lender. Each
notice of Borrowing (a “Notice of Borrowing”) shall be in writing (which may be
by telecopier or electronic communication), in substantially the form of Exhibit
B hereto, specifying therein the requested (i) date of the Borrowing (which
shall be a Business Day) and (ii) the amount of such Borrowing. Upon fulfillment
of the applicable conditions set forth in Article III, the Lender will make the
funds available to the Borrower at its address referred to in Section 7.02.

SECTION 2.03. Repayment. The Borrower shall repay to the Lender on the
Termination Date (other than a Termination Date occurring under clause (iii) of
the definition thereof) the aggregate principal amount of the Advances then
outstanding.

SECTION 2.04. Interest. (a) Scheduled Interest. The Borrower shall pay interest
on the unpaid principal amount of each Advance owing to the Lender from the date
of such Advance until such principal amount shall be paid in full, at a rate per
annum equal to (i) from the Effective Date until December 31, 2009, 3.5%,
payable in arrears on December 31, 2009 and on the date such Advance shall be
paid in full and (ii) on and after January 1, 2010, at all times during each
Interest Period, the sum of (x) the Eurodollar Rate for such Interest Period
plus (y) the Applicable Margin, payable in arrears on the last day of such
Interest Period and on the date such Advance shall be paid in full.

 

 

7

 

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

(b)       Default Interest. Upon the occurrence and during the continuance of a
Default under Section 6.01(a) or (b) or an Event of Default, the Lender may
require the Borrower to pay interest (“Default Interest”) on (i) the unpaid
principal amount of each Advance owing to the Lender, payable in arrears on the
dates referred to in clause (a) above and (ii) to the fullest extent permitted
by law, the amount of any interest, fee or other amount payable hereunder that
is not paid when due, from the date such amount shall be due until such amount
shall be paid in full, payable in arrears on the date such amount shall be paid
in full and on demand, in each case at a rate per annum equal at all times to 2%
per annum above the rate per annum required to be paid on such Advance pursuant
to clause (a) above; provided, however, that following acceleration of the
Advances pursuant to Section 6.01, Default Interest shall accrue and be payable
hereunder whether or not previously required by the Lender.

SECTION 2.05. [Reserved.]

SECTION 2.06. Optional Prepayments. The Borrower may, without payment of any
premium or penalty and upon at least three Business Days’ notice to the Lender
stating the proposed date and aggregate principal amount of the prepayment, and
if such notice is given the Borrower shall, prepay the outstanding principal
amount of the Advances in whole or in part, together with accrued interest to
the date of such prepayment on the principal amount prepaid. Any prepayment
pursuant to this Section 2.06 shall result in a permanent reduction in the
Commitment in the amount of such prepayment.

SECTION 2.07. Illegality. Notwithstanding any other provision of this Agreement,
if the Lender determines that the introduction of or any change in or in the
interpretation of any law or regulation makes it unlawful, or any central bank
or other Governmental Authority asserts that it is unlawful, for the Lender to
perform its obligations hereunder to make the Advances or to fund or maintain
the Advances to be made by it hereunder, the Lender shall forthwith give notice
thereof to the Borrower, whereupon (a) until the Lender notifies the Borrower
that the circumstances giving rise to such suspension no longer exist, the
obligation of the Lender to make Advances shall be suspended and (b) if the
Lender shall so request in such notice, the Borrower shall immediately prepay in
full the then aggregate outstanding principal amount of the Advances, together
with accrued interest thereon.

SECTION 2.08. Payments and Computations. (a) The Borrower shall make each
payment hereunder and under the Note, irrespective of any right of counterclaim
or set-off, not later than 11:00 A.M. (New York City time) on the day when due
in U.S. dollars to the Lender by wire transfer of same day funds to an account
specified by the Lender; provided, however, that on any Termination Date
occurring under clause (i) or (ii) of the definition thereof, the Borrower may,
at its option, pay the aggregate principal amount of the Advances then
outstanding, and accrued and unpaid interest thereon, in DTV Stock by delivering
to the Lender certificates representing shares of DTV Stock in an amount equal
to the DTV Stock Equivalent Amount calculated as of such Termination Date,
together with any necessary endorsements or other transfer documents reasonably
requested by the Lender.

(b)       All computations of interest shall be made by the Lender on the basis
of a year of 360 days, in each case for the actual number of days (with respect
to interest payable pursuant to Section 2.04(a)(i), including the first day and
the last day, and with respect to interest payable pursuant to Section
2.04(a)(ii),including the first day but excluding the last day) occurring in the
period for which such interest is payable. Each determination by the Lender of
an interest rate hereunder shall be conclusive and binding for all purposes,
absent manifest error.

(c)        Whenever any payment hereunder or under the Note shall be stated to
be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest; provided, however, that, if
such extension would cause payment of interest on or principal of the Advances
to be

 

 

8

 

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

made in the next following calendar month, such payment shall be made on the
next preceding Business Day.

SECTION 2.09. Taxes. (a) Any and all payments by the Borrower hereunder or under
the Note or any other documents to be delivered hereunder shall be made free and
clear of and without deduction for any and all present or future taxes
(including value-added taxes and withholding taxes), levies, imposts,
deductions, charges or withholdings, and, all liabilities with respect thereto,
excluding, in the case of the Lender, (i) taxes imposed on its overall net
income (including branch profits taxes), and franchise taxes or similar taxes
imposed on it in lieu of net income taxes, by the jurisdiction under the laws of
which the Lender is organized or any political subdivision thereof and taxes
imposed on its overall net income, and franchise taxes imposed on it in lieu of
net income taxes, by the jurisdiction of the Lender’s principal executive
offices or any political subdivision thereof or is otherwise treated as doing
business in such jurisdiction, (ii) in the case of a Lender, any withholding tax
that is imposed on amounts payable to such Lender at the time such Lender
becomes a party hereto, (iii) any U.S. backup withholding taxes and (iv) any
other taxes imposed as a result of the Lender’s gross negligence or willful
misconduct (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities in respect of payments hereunder or under the Notes
being hereinafter referred to as “Taxes”). If the Borrower shall be required by
law to deduct any Taxes from or in respect of any sum payable hereunder under
any Note or any other documents to be delivered hereunder to the Lender, (i) the
sum payable shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.09) the Lender receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with applicable
law.

(b)       In addition, the Borrower shall pay any present or future stamp or
documentary taxes or any other similar excise or property taxes, charges or
similar levies that arise from any payment made hereunder or under the Note or
any other documents to be delivered hereunder or from the execution, delivery or
registration of, performing under, or otherwise with respect to, this Agreement
or the Note or any other documents to be delivered hereunder (hereinafter
referred to as “Other Taxes”).

(c)        The Borrower shall indemnify the Lender for and hold it harmless
against the full amount of Taxes or Other Taxes (including taxes of any kind
imposed or asserted by any jurisdiction on amounts payable under this Section
2.09) imposed on or paid by the Lender and any liability (including penalties,
interest and expenses) arising therefrom or with respect thereto. This
indemnification shall be made within 10 days from the date the Lender makes
written demand therefor.

(d)       Within 30 days after the date of any payment of Taxes, the Borrower
shall furnish to the Lender, at its address referred to in Section 7.02, a copy
of a receipt evidencing such payment, to the extent such a receipt is issued
therefore, or other written proof of payment thereof that is reasonably
satisfactory to the Lender.

(e)        Lender, at any of the following times, shall (i) on or prior to the
date of the first Advance, (ii) on or prior to the date on which any such form
or certification expires or become obsolete, (iii) after the occurrence of any
event requiring the change in the most recent form or certification previously
delivered by it pursuant to this Section 2.09(e), and (iv) from time to time if
requested by the Borrower, provide the Borrower with two completed originals of
United States Internal Revenue Service Form W-9 or any successor forms and any
other applicable document prescribed by the United States Internal Revenue
Service.

 

 

9

 

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

SECTION 2.10. Use of Proceeds. The proceeds of the Advances shall be available
(and the Borrower agrees that it shall use such proceeds) solely for (a)
contribution to Greenlady II to enable Greenlady II to pay scheduled maturities
and Gradual Repayment Amounts (as defined in the BOA Credit Agreement) under the
BOA Credit Agreement and the Collar Transaction in accordance with their
respective terms, together with amounts that become due thereunder by virtue of
the exercise by Bank of America of its partial unwind right in the Collar
Agreement following the occurrence of an “Insider Acquisition Event” or other
“Adjustment Event” (as such terms are defined in the Collar Agreement) caused by
actions of DIRECTV (collectively, “Permitted Payments”) and (b) refinancing the
outstanding BofA Advances (as defined in the LMC Credit Agreement), if any,
under the LMC Credit Agreement (the “Permitted Refinancing”).

SECTION 2.11. Evidence of Debt. The Lender shall keep a record evidencing the
indebtedness of the Borrower to the Lender resulting from each Advance owing to
the Lender from time to time, including the amounts of principal and interest
payable and paid to the Lender from time to time hereunder. The Borrower agrees
that upon request by the Lender, the Borrower shall promptly execute and deliver
to the Lender a Note in substantially the form of Exhibit A hereto, payable to
the order of the Lender in a principal amount equal to the Commitment.

ARTICLE III

 

CONDITIONS TO EFFECTIVENESS AND LENDING

SECTION 3.01. Conditions Precedent to Effectiveness of Section 2.01. Section
2.01 of this Agreement shall become effective on and as of the first date (the
“Effective Date”) on which the following conditions precedent have been
satisfied:

(a)        The Lender shall have received (i) this Agreement, executed and
delivered by a duly authorized officer of the Borrower and the Lender and (ii)
the Pledge Agreement, executed and delivered by a duly authorized officer of the
Borrower and the Lender.

(b)       The Lender shall have received true and correct copies, certified as
to authenticity by the Borrower, of (i) the BOA Credit Agreement, (ii) the
Collar Agreement, (iii) the Transaction Acknowledgement, (iii) the Parent
Guarantee and (iv) the LMC Credit Agreement.

(c)        The Lender shall have received an executed legal opinion from outside
counsel to the Borrower, in substantially the form attached hereto as Exhibit D.

(d)       The Lender shall have received the certificates representing the
shares of Initial Pledged Stock (as defined in the Pledge Agreement) pledged
pursuant to the Pledge Agreement, together with an undated stock power for each
such certificate executed in blank by a duly authorized officer of the Borrower,
and such pledge shall create a security interest in sufficient Collateral to
result in a Maximum Loan Value (as defined in Regulation U of the Federal
Reserve Board) with respect to the Pledged Stock equal to at least $650,000,000.

(e)        Each document (including, without limitation, any Uniform Commercial
Code financing statement) required by the Pledge Agreement or under law or
reasonably requested by the Lender to be filed, registered or recorded in order
to create in favor of the Lender a perfected Lien on the Collateral shall have
been filed, registered or recorded or shall have been delivered to the Lender in
proper form for filing, registration or recordation.

 

 

10

 

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

(f)        There shall have occurred no Material Adverse Change since the date
of this Agreement.

(g)       There shall exist no action, suit, investigation, litigation or
proceeding affecting the Borrower or any of its Subsidiaries (including
Greenlady II) pending or threatened before any court, governmental agency or
arbitrator that (i) could be reasonably likely to have a Material Adverse Effect
or (ii) purports to affect the legality, validity or enforceability of this
Agreement or any other Loan Document or the consummation of the transactions
contemplated hereby.

(h)       All governmental and third party consents and approvals necessary in
connection with the transactions contemplated hereby (if any) shall have been
obtained (without the imposition of any conditions that are not acceptable to
the Lender) and shall remain in effect, and no law or regulation shall be
applicable in the reasonable judgment of the Lender that restrains, prevents or
imposes materially adverse conditions upon the transactions contemplated hereby.

 

(i)

The Split-Off Effective Time shall have occurred.

(j)        On the Effective Date, the following statements shall be true and the
Lender shall have received a certificate signed by a duly authorized officer of
the Borrower, dated the Effective Date, stating that:

(i)        The representations and warranties contained in Section 4.01 are
correct on and as of the Effective Date, and

 

(ii)

No event has occurred and is continuing that constitutes a Default.

(k)       The Lender shall have received a certificate of the Secretary of the
Borrower certifying (i) the names and true signatures of each officer of the
Borrower that has been authorized to execute and deliver any Loan Document or
other document required hereunder to be executed and delivered by or on behalf
of the Borrower, (ii) the certificate of incorporation of the Borrower,
certified as of a recent date by the Secretary of State of the state of
incorporation of the Borrower, together with a certificate of such official
attesting to the good standing of the Borrower, (iii) the by-laws of the
Borrower as in effect on the date of such certification, and (iv) the
resolutions of the Borrower’s Board of Directors approving and authorizing the
execution, delivery and performance of this Agreement and the other Loan
Documents.

(l)        The Lender shall have received the Note to the order of the Lender,
if requested by the Lender.

SECTION 3.02. Conditions Precedent to Each Borrowing. The obligation of the
Lender to make an Advance on the occasion of each Borrowing shall be subject to
the conditions precedent that the Effective Date shall have occurred and on the
date of each Borrowing:

(a)        the following statements shall be true (and each of the giving of the
Notice of Borrowing and the acceptance by the Borrower of the proceeds of the
Borrowing shall constitute a representation and warranty by the Borrower that on
the date of such Borrowing such statements are true):

(i)        the representations and warranties contained in Section 4.01 are
correct on and as of the date of such Borrowing, before and after giving effect
to such Borrowing and to the application of the proceeds therefrom, as though
made on and as of such date;

 

 

11

 

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

(ii)       no event has occurred and is continuing, or would result from such
Borrowing or from the application of the proceeds therefrom, that constitutes a
Default;

(iii)      all of the proceeds of such Borrowing shall be used solely in
accordance with Section 2.10;

(iv)      with respect to any Borrowing the proceeds of which will be used to
make a Permitted Payment, a Permitted Payment in the amount of such Borrowing is
due within 1 Business Day of the date of such Borrowing;

(v)       the Borrower has not made any representation or warranty herein or in
connection with this Agreement that shall prove to have been incorrect in any
material respect when made; and

(vi)      the Borrower has not failed to perform or observe any term, covenant
or agreement contained in this Agreement or any other Loan Document on its part
to be performed or observed, other than any failure that shall have been
remedied;

(b)       the Lender shall have received a duly executed “Statement of Purpose
for an Extension of Credit Secured by Margin Stock by a Person Subject to
Registration Under Regulation U” on Federal Reserve Form G-3 and a “Statement of
Purpose for an Extension of Credit Secured by Margin Stock” on Federal Reserve
Form U-1 with respect to such Borrowing, each completed in form and substance
satisfactory to Lender; and

 

(c)

the Termination Date shall not have occurred.

ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

SECTION 4.01. Representations and Warranties of the Borrower. The Borrower
represents and warrants as follows:

(a)        The Borrower is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and has all requisite
corporate power and authority (including all governmental licenses, permits and
other approvals) to own, lease and operate its properties and to carry on its
business as now conducted and as proposed to be conducted.

(b)       The execution, delivery and performance by the Borrower of this
Agreement and the other Loan Documents, and the consummation of the transactions
contemplated hereby and thereby, are within the Borrower’s corporate powers,
have been duly authorized by all necessary corporate action, and do not
contravene (i) the Borrower’s charter or by-laws or (ii) any law or contractual
restriction binding on or affecting the Borrower.

(c)        No authorization or approval or other action by, and no notice to or
filing with, any Governmental Authority or regulatory body or any other third
party is required for the due execution, delivery and performance by the
Borrower of this Agreement or the other Loan Documents.

(d)       This Agreement has been, and each of the other Loan Documents when
delivered will have been, duly executed and delivered by the Borrower. This
Agreement is, and each of the other

 

 

12

 

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

Loan Documents when delivered will be, the legal, valid and binding obligation
of the Borrower enforceable against the Borrower in accordance with their
respective terms.

(e)        There is no pending or threatened action, suit, investigation,
litigation or proceeding affecting the Borrower or any of its Subsidiaries
before any court, governmental agency or arbitrator that (i) could be reasonably
likely to have a Material Adverse Effect or (ii) purports to affect the
legality, validity or enforceability of this Agreement or any other Loan
Document or the consummation of the transactions contemplated hereby or thereby.

(f)        The Pledge Agreement is effective to create in favor of the Lender a
legal, valid and enforceable security interest in the Collateral. In the case of
the Pledged Stock described in the Pledge Agreement, when any stock certificates
representing such Pledged Stock are delivered to the Lender, and in the case of
the other Collateral described in the Pledge Agreement, when financing
statements in appropriate form are filed in the offices specified on Schedule II
to the Pledge Agreement, the Pledge Agreement shall constitute a fully perfected
lien on, and security interest in, all right, title and interest of the Borrower
in such Collateral, as security for the Secured Obligations (as defined in the
Pledge Agreement), in each case prior and superior in right to any other Person.

ARTICLE V

 

COVENANTS OF THE BORROWER

SECTION 5.01. Affirmative Covenants. So long as any Advance shall remain unpaid,
any other Obligation remains outstanding or the Lender shall have any Commitment
hereunder, the Borrower will:

(a)        Compliance with Laws, Etc. Comply, and cause each of its Subsidiaries
to comply, in all material respects, with all applicable laws, rules,
regulations and orders.

(b)       Payment of Taxes, Etc. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become delinquent, (i)
all taxes, assessments and governmental charges or levies imposed upon it or
upon its property and (ii) all lawful claims that, if unpaid, might by law
become a Lien upon its property; provided, however, that neither the Borrower
nor any of its Subsidiaries shall be required to pay or discharge any such tax,
assessment, charge or claim (i) the failure of which to pay or discharge could
not reasonably be expected to have a Material Adverse Effect or (ii) that is
being contested in good faith and by proper proceedings and as to which
appropriate reserves are being maintained.

(c)        Maintenance of Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable insurance
companies or associations in such amounts and covering such risks as is usually
carried by companies engaged in similar businesses and owning similar properties
in the same general areas in which the Borrower or such Subsidiary operates.

(d)       Preservation of Corporate Existence, Etc. Preserve and maintain its
corporate existence, rights (charter and statutory), permits, approvals,
licenses, privileges and franchises; provided, however, that the Borrower shall
not be required to preserve any right or franchise if the Board of Directors of
the Borrower shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Borrower, and that the loss
thereof is not disadvantageous in any material respect to the Borrower or the
Lender.

 

 

13

 

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

(e)        Visitation Rights. At any reasonable time and from time to time,
permit the Lender or any agents or representatives thereof, to examine and make
copies of and abstracts from the records and books of account of, and visit the
properties of, the Borrower and any of its Subsidiaries, and to discuss the
affairs, finances and accounts of the Borrower and any of its Subsidiaries with
any of their officers or directors and with their independent certified public
accountants.

(f)        Keeping of Books. Keep, and cause each of its Subsidiaries to keep,
proper books of record and account, in which full and correct entries shall be
made of all financial transactions and the assets and business of the Borrower
and each such Subsidiary in accordance with generally accepted accounting
principles in effect from time to time.

(g)       Maintenance of Properties Etc. Maintain and preserve, and cause each
of its Subsidiaries to maintain and preserve, all of its properties that are
used or useful in the conduct of its business in good working order and
condition, ordinary wear and tear excepted.

 

(h)

Reporting Requirements. Furnish to the Lender:

(i)        as soon as possible and in any event within five days after the
occurrence of each Default continuing on the date of such statement, a statement
of the chief financial officer of the Borrower setting forth details of such
Default and the action that the Borrower has taken and proposes to take with
respect thereto;

(ii)       promptly after the commencement thereof, notice of all actions and
proceedings before any court, governmental agency or arbitrator affecting the
Borrower or any of its Subsidiaries of the type described in Section 4.01(e);
and

(iii)      such other information respecting the Borrower or any of its
Subsidiaries as the Lender may from time to time reasonably request.

SECTION 5.02. Negative Covenants. So long as any Advance shall remain unpaid,
any other Obligation remains outstanding or the Lender shall have any Commitment
hereunder, the Borrower will not, and will not permit any of its Subsidiaries
(including Greenlady II with respect to Section 5.02(c) only) to:

(a)        Liens, Etc. Create or suffer to exist any Lien on or with respect to
any of its properties, whether now owned or hereafter acquired, or assign any
right to receive income, other than:

 

(i)

Liens created under the Pledge Agreement;

 

(ii)

Permitted Liens;

 

(iii)

Liens existing on the Effective Date; and

(iv)      the replacement, extension or renewal of any Lien permitted by clause
(ii) above upon or in the same property theretofore subject thereto or the
replacement, extension or renewal (without increase in the amount or change in
any direct or contingent obligor) of the Debt secured thereby.

 

(b)

Debt. Create, incur, assume or suffer to exist any Debt, except:

 

(i)

Debt under this Agreement;

 

 

14

 

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

(ii)       Debt existing on the Effective Date (the “Existing Debt”), and any
Debt extending the maturity of, or refunding or refinancing, in whole or in
part, the Existing Debt, provided that the principal amount of such Existing
Debt shall not be increased above the principal amount thereof outstanding
immediately prior to such extension, refunding or refinancing, and the direct
and contingent obligors therefor shall not be changed, as a result of or in
connection with such extension, refunding or refinancing; and

 

(iii)

Debt under the LMC Credit Agreement.

(c)        Modifications of Certain Documents. (i) Amend, modify or otherwise
change, or consent or agree to any amendment, modification, waiver or other
change to, any of the terms of the BOA Credit Agreement, the Collar Agreement or
the LMC Credit Agreement without the prior written consent of the Lender (which
consent shall not be unreasonably withheld or delayed), except Greenlady II may
replace the Parent Guarantee with a substantially similar guarantee provided by
LEI, or (ii) amend its certificate of incorporation, by-laws or equivalent
organizational documents in any manner determined by the Lender to be adverse to
the Lender.

ARTICLE VI

 

EVENTS OF DEFAULT

SECTION 6.01. Events of Default. If any of the following events (“Events of
Default”) shall occur and be continuing:

(a)        the Borrower shall fail to pay any principal of any Advance when the
same shall become due and payable or (ii) the Borrower shall fail to pay any
interest on any Advance or to make any other payment under this Agreement or the
other Loan Documents, in each case under this clause (ii) within three Business
Days after the same shall become due and payable; or

(b)       the Borrower or any of its Subsidiaries (including Greenlady II) shall
generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general assignment for
the benefit of creditors; or any proceeding shall be instituted by or against
the Borrower or any of its Subsidiaries (including Greenlady II) seeking to
adjudicate it bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a receiver, trustee, custodian or other similar official
for it or for any substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it) that is being
diligently contested in good faith, either such proceeding shall remain
undismissed or unstayed for a period of 30 days, or any of the actions sought in
such proceeding (including the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official for, it
or for any substantial part of its property) shall occur; or the Borrower or any
of its Subsidiaries (including Greenlady II) shall take any corporate action to
authorize any of the actions set forth above in this subsection (b); or

(c)        any provision of this Agreement or the other Loan Documents shall
cease to be valid and binding on or enforceable against the Borrower; or the
Borrower shall so assert or state in writing; or

 

 

15

 

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

(d)       the Pledge Agreement shall for any reason fail or cease to create a
valid and enforceable lien on any Collateral purported to be covered thereby or
such lien shall fail or cease to be a perfected and first priority lien, or the
Borrower shall so state in writing;

then, and in any such event, the Lender (i) may declare its Commitment and its
obligation to make Advances to be terminated, whereupon the same shall forthwith
terminate, and (ii) may, by notice to the Borrower, declare the Advances, all
interest thereon and all other amounts payable under this Agreement and under
the Note to be forthwith due and payable, whereupon the Advances, all such
interest and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by the Borrower; provided, however. that in the case
of an Event of Default under clause (b) above, (A) the Commitment and the
obligation of the Lender to make Advances shall automatically be terminated and
(B) the Advances, all such interest and all such amounts shall automatically
become and be due and payable, without presentment, demand, protest or any
notice of any kind, all of which are hereby expressly waived by the Borrower.

ARTICLE VII

 

MISCELLANEOUS

SECTION 7.01. Amendment, Etc. No amendment or waiver of any provision of this
Agreement or the other Loan Documents, nor consent to any departure by the
Borrower therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Lender, and then such waiver or consent shall be
effective only in the specific instance and for the specific propose for which
given.

SECTION 7.02. Notices, Etc. All notices and other communications provided for
hereunder shall be in writing, or by any telecommunications device capable of
creating a written record (including electronic mail) and addressed, if to the
Borrower, at 12300 Liberty Boulevard, Englewood, Colorado, 80112 Attention:
Treasury Group (c/o Neal Dermer, facsimile: (720) 875-5442, email address:
ndermer@libertymedia.com), with a copy to Attention: Legal (c/o Craig Troyer,
facsimile: (720) 875-5382, email address: craig@libertymedia.com); if to the
initial Lender, at 2230 East Imperial Highway, El Segundo, CA 90245, Attention:
Patrick T. Doyle, Chief Financial Officer (facsimile: (310) 964-0882, email
address: patrick.doyle@directv.com); if to any other Lender, at the address
specified in the Assignment and Acceptance pursuant to which it became a Lender;
or, as to the Borrower or the Lender, at such other address as shall be
designated by such party in a written notice to the other party. All such
notices and communications shall be effective (i) if delivered by hand,
including any overnight courier service, upon personal delivery, (ii) if
delivered by mail, when deposited in the mails, and (iii) if delivered by
electronic mail or any other telecommunications device, when transmitted to an
electronic mail address (or by another means of electronic delivery); provided,
however, that notices and communications to the Lender pursuant to Article II or
III shall not be effective until received by the Lender.

SECTION 7.03. No Waiver; Remedies. No failure on the part of the Lender to
exercise, and no delay in exercising, any right hereunder or under any Note
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right preclude any other or further exercise thereof or the exercise of
any other right. The remedies herein provided are cumulative and not exclusive
of any remedies provided by law.

SECTION 7.04. Costs and Expenses. (a) The Borrower agrees to pay on demand all
costs and expenses of the Lender, if any (including counsel fees and expenses),
in connection with the enforcement (whether through negotiations, legal
proceedings or otherwise) of this Agreement and the

 

 

16

 

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

other Loan Documents, including fees and expenses of counsel for the Lender in
connection with the enforcement of rights under this Section 7.04(a).

(b)       The Borrower agrees to indemnify and hold harmless the Lender and each
of its Affiliates and their officers, directors, administrators, trustees,
employees, agents and advisors (each, an “Indemnified Party”) from and against
any and all claims, damages, losses, liabilities and expenses (including
reasonable fees and expenses of counsel) incurred by or asserted or awarded
against any Indemnified Party, in each case arising out of or in connection with
or by reason of (including in connection with any investigation, litigation or
proceeding or preparation of a defense in connection therewith) this Agreement,
the other Loan Documents, any of the transactions contemplated herein or therein
or the actual or proposed use of the proceeds of the Advances, except to the
extent such claim, damage, loss, liability or expense is found in a final,
non-appealable judgment by a court of competent jurisdiction to have resulted
from such Indemnified Party’s gross negligence or willful misconduct. In the
case of an investigation, litigation or other proceeding to which the indemnity
in this Section 7.04(b) applies, such indemnity shall be effective whether or
not such investigation, litigation or proceeding is brought by the Borrower, its
directors, equityholders or creditors or an Indemnified Party or any other
Person, whether or not any Indemnified Party is otherwise a party thereto and
whether or not the transactions contemplated hereby are consummated. The
Borrower also agrees not to assert any claim for special, indirect,
consequential or punitive damages against the Lender, any of its Affiliates, or
any of their respective directors, officers, employees, attorneys and agents, on
any theory of liability arising out of or otherwise relating to this Agreement,
the other Loan Documents, any of the transactions contemplated herein or therein
or the actual or proposed use of the proceeds of the Advances.

(c)        Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in
Section 7.04 shall survive the payment in full of principal, interest and all
other Obligations.

SECTION 7.05. Right of Set-off. Upon the occurrence and during the continuance
of any Event of Default, the Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any other indebtedness at any time owing by the Lender
or such Affiliate to or for the credit or the account of the Borrower against
any and all of the obligations of the Borrower now or hereafter existing under
this Agreement and any other Loan Document held by the Lender, whether or not
the Lender shall have made any demand under this Agreement or such other Loan
Document and although such obligations may be unmatured. The Lender agrees
promptly to notify the Borrower after any such set-off and application, provided
that the failure to give such notice shall not affect the validity of such
set-off and application. The rights of the Lender and its Affiliates under this
Section are in addition to other rights and remedies (including other rights of
set-off) that the Lender and its Affiliates may have.

SECTION 7.06. Binding Effect. This Agreement shall become effective (other than
Section 2.01, which shall only become effective upon satisfaction of the
conditions precedent set forth in Section 3.01) when it shall have been executed
by the Borrower and the Lender, and thereafter shall be binding upon and inure
to the benefit of the Borrower and the Lender and their respective successors
and assigns, except that the Borrower shall not have the right to assign its
rights hereunder or any interest herein without the prior written consent of the
Lender.

SECTION 7.07. Assignments and Participations. (a) The Lender may assign to one
Person all (but no less than all) of its rights and obligations under this
Agreement (including all of its Commitment, the Advances owing to it and the
Note held by it); provided, however, that such assignee is an Affiliate of DTV
and the parties to such assignment execute and deliver an Assignment and
Acceptance, together with any Note(s) subject to such assignment; provided,
further, that if such assignee

 

 

17

 

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

is a wholly-owned subsidiary of DTV, DTV shall remain liable for the performance
by such assignee of its obligations as a Lender hereunder; provided, further,
that if such assignee is not a wholly-owned subsidiary of DTV, such assignee
shall be subject to the prior written consent of the Borrower (which consent
shall not be unreasonably withheld or delayed). Upon such execution and
delivery, from and after the effective date specified in each Assignment and
Acceptance, (x) the assignee thereunder shall be a party hereto and have the
rights and obligations of the Lender hereunder and (y) the Lender assignor
thereunder shall relinquish its rights (other than its rights under Section 7.04
to the extent any claim thereunder relates to an event arising prior to such
assignment) and be released from its obligations under this Agreement and such
Lender shall cease to be a party hereto.

(b)       Within five Business Days after its receipt of notice of an assignment
hereunder and any Note(s) subject to such assignment, the Borrower, at its own
expense, shall execute and deliver to the Lender assignee in exchange for each
surrendered Note(s) a new Note to the order of such assignee in an amount equal
to the outstanding amount of the Note(s) assumed by it pursuant to such
Assignment and Acceptance. Such new Note shall be in an aggregate principal
amount equal to the aggregate principal amount of such surrendered Note(s),
shall be dated the effective date of such Assignment and Acceptance and shall
otherwise be in substantially the form of Exhibit A hereto.

(c)        The Lender may, in connection with any assignment or proposed
assignment pursuant to this Section 7.07, disclose to the assignee or proposed
assignee any information relating to the Borrower furnished to the Lender by or
on behalf of the Borrower.

SECTION 7.08. Severability. Any provision of this Agreement or any other Loan
Document held to be invalid, illegal or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such invalidity,
illegality or unenforceability without affecting the validity, legality and
enforceability of the remaining provisions hereof; and the invalidity of a
particular provision in a particular jurisdiction shall not invalidate such
provision in any other jurisdiction.

SECTION 7.09. Electronic Execution of Assignments. The words “execution,”
“signed,” “signature” and words of like import in any Assignment and Acceptance
shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act.

SECTION 7.10. Governing Law. This Agreement and the other Loan Documents shall
be governed by, and construed in accordance with, the laws of the State of New
York.

SECTION 7.11. Execution in Counterparts. This Agreement 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 Agreement by telecopier or
other form of electronic communication shall be effective as delivery of a
manually executed counterpart of this Agreement.

SECTION 7.12. Jurisdiction; Waiver of Immunities. (a) Each of the parties hereto
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or federal court of
the United States sitting in the Borough of Manhattan, New York City, and any
appellate court from any thereof, in any action or proceeding arising

 

 

18

 

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

out of or relating to this Agreement or the other Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. Each of the
parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.

(b)       Each of the parties hereto irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or the Notes in any New
York State or federal court. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.

(c)        To the extent that the Borrower has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether
through service or notice, attachment prior to judgment, attachment in aid of
execution or otherwise) with respect to itself or its property, the Borrower
hereby irrevocably and unconditionally waives such immunity in respect of its
obligations under this Agreement and the other Loan Documents.

(d)       Nothing in this Section 7.12 shall affect the right of the Lender to
serve legal process in any other manner permitted by law or affect the right of
the. Lender to bring any action or proceeding against the Borrower or its
property in the courts of other jurisdictions.

SECTION 7.13. Waiver of Jury Trial. Each of the Borrower and the Lender hereby
irrevocably waives all right to trial by jury in any action proceeding or
counterclaim (whether based on contract, tort or otherwise) arising out of or
relating to this Agreement or the other Loan Documents or the actions of the
Lender in the negotiation, administration, performance or enforcement thereof.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

19

 

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

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

 

Borrower

 

GREENLADY CORP.

 

By:

  /s/  Charles Y. Tanabe

Name: Charles Y. Tanabe Title:

Executive Vice President

 

 

 

Lender

 

THE DIRECTV GROUP, INC.

 

By:

  /s/  Larry D. Hunter

Name: Larry D. Hunter Title: Executive Vice President

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[SIGNATURE PAGE TO CREDIT AGREEMENT]