Exhibit 10.2

EXECUTION VERSION

 

 

 

CREDIT AGREEMENT

dated as of

December 28, 2012

among

EMMIS OPERATING COMPANY,

as Borrower

EMMIS COMMUNICATIONS CORPORATION,

as Parent

The Credit Parties Party Hereto

The Lenders Party Hereto

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

GENERAL ELECTRIC CAPITAL CORPORATION,

as Syndication Agent

and

FIFTH THIRD BANK,

as Documentation Agent

 

 

J.P. MORGAN SECURITIES LLC and

GE CAPITAL MARKETS, INC.,

as Joint Bookrunners and Joint Lead Arrangers

 

 

 

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

TABLE OF CONTENTS

 

      Page  

ARTICLE I Definitions

     1   

SECTION 1.01. Defined Terms

     1   

SECTION 1.02. Classification of Loans and Borrowings

     29   

SECTION 1.03. Terms Generally

     29   

SECTION 1.04. Accounting Terms; GAAP

     30   

SECTION 1.05. Pro Forma Calculations

     30   

ARTICLE II The Credits

     31   

SECTION 2.01. Commitments

     31   

SECTION 2.02. Loans and Borrowings

     32   

SECTION 2.03. Requests for Borrowings

     33   

SECTION 2.04. [Intentionally Omitted]

     33   

SECTION 2.05. Swingline Loans

     33   

SECTION 2.06. Letters of Credit

     34   

SECTION 2.07. Funding of Borrowings

     38   

SECTION 2.08. Interest Elections

     39   

SECTION 2.09. Termination, Reduction and Increase of Commitments

     40   

SECTION 2.10. Repayment of Loans; Evidence of Debt

     42   

SECTION 2.11. Prepayment of Loans

     43   

SECTION 2.12. Fees

     45   

SECTION 2.13. Interest

     46   

SECTION 2.14. Alternate Rate of Interest

     47   

SECTION 2.15. Increased Costs

     48   

SECTION 2.16. Break Funding Payments

     49   

SECTION 2.17. Taxes

     50   

SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs

     53   

SECTION 2.19. Mitigation Obligations; Replacement of Lenders

     55   

SECTION 2.20. Defaulting Lenders

     56   

ARTICLE III Representations and Warranties

     58   

SECTION 3.01. Organization; Powers

     58   

SECTION 3.02. Authorization; Enforceability

     58   

SECTION 3.03. Governmental Approvals; No Conflicts

     58   

SECTION 3.04. Financial Condition; No Material Adverse Change

     58   

SECTION 3.05. Properties

     59   

SECTION 3.06. Litigation and Environmental Matters

     59   

SECTION 3.07. Compliance with Laws and Agreements

     60   

SECTION 3.08. Investment Company Status; Margin Stock

     60   

SECTION 3.09. Taxes

     60   

SECTION 3.10. ERISA

     60   

SECTION 3.11. Disclosure

     61   

SECTION 3.12. Patriot Act

     61   

SECTION 3.13. Material Agreements

     61   

 

i

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

SECTION 3.14. Security Interests in Collateral

     62   

SECTION 3.15. Solvency

     62   

SECTION 3.16. Licenses and Approvals

     62   

SECTION 3.17. Subsidiaries; Excluded Subsidiaries

     65   

SECTION 3.18. Insurance

     66   

SECTION 3.19. Labor

     66   

SECTION 3.20. Burdensome Restrictions

     66   

SECTION 3.21. No Default

     66   

ARTICLE IV Conditions

     67   

SECTION 4.01. Effective Date

     67   

SECTION 4.02. Each Credit Event

     70   

ARTICLE V Affirmative Covenants

     71   

SECTION 5.01. Financial Statements; Ratings Change and Other Information

     71   

SECTION 5.02. Notices of Material Events

     72   

SECTION 5.03. Existence; Conduct of Business

     73   

SECTION 5.04. Payment of Obligations

     73   

SECTION 5.05. Maintenance of Properties; Insurance

     74   

SECTION 5.06. Books and Records; Inspection Rights

     74   

SECTION 5.07. Compliance with Laws, Contracts, Licenses and Permits

     74   

SECTION 5.08. Use of Proceeds and Letters of Credit

     75   

SECTION 5.09. Interest Rate Protection

     75   

SECTION 5.10. Casualty and Condemnation

     76   

SECTION 5.11. [Intentionally Omitted]

     76   

SECTION 5.12. Depository Banks

     76   

SECTION 5.13. Additional Guarantors and Collateral; Further Assurances

     76   

ARTICLE VI Negative Covenants

     78   

SECTION 6.01. Indebtedness

     78   

SECTION 6.02. Liens

     79   

SECTION 6.03. Fundamental Changes; Sale of Assets

     79   

SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions

     81   

SECTION 6.05. Swap Agreements

     82   

SECTION 6.06. Sale and Leaseback Transactions

     82   

SECTION 6.07. Restricted Payments; Certain Payments of Indebtedness

     83   

SECTION 6.08. Transactions with Affiliates

     84   

SECTION 6.09. Restrictive Agreements

     85   

SECTION 6.10. Amendment of Material Documents

     85   

SECTION 6.11. Excluded Subsidiaries

     85   

SECTION 6.12. Parent Covenant

     86   

SECTION 6.13. Fiscal Year

     86   

SECTION 6.14. Minimum Fixed Charge Coverage Ratio

     86   

SECTION 6.15. Maximum Senior Leverage Ratio

     87   

SECTION 6.16. Maximum Total Leverage Ratio

     87   

 

ii

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

ARTICLE VII Events of Default

     87   

ARTICLE VIII The Administrative Agent

     92   

SECTION 8.01. Appointment

     92   

SECTION 8.02. Rights and Power

     92   

SECTION 8.03. Exculpatory Provisions

     93   

SECTION 8.04. Administrative Agent Reliance

     93   

SECTION 8.05. Delegation of Duties

     93   

SECTION 8.06. Resignation

     94   

SECTION 8.07. Lender Non-Reliance

     94   

SECTION 8.08. Other Titles

     94   

SECTION 8.09. Collateral and Guarantee Matters

     94   

ARTICLE IX Miscellaneous

     95   

SECTION 9.01. Notices

     95   

SECTION 9.02. Waivers; Amendments

     97   

SECTION 9.03. Expenses; Indemnity; Damage Waiver

     98   

SECTION 9.04. Successors and Assigns

     100   

SECTION 9.05. Survival

     104   

SECTION 9.06. Counterparts; Integration; Effectiveness

     104   

SECTION 9.07. Severability

     105   

SECTION 9.08. Right of Setoff

     105   

SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process

     105   

SECTION 9.10. WAIVER OF JURY TRIAL

     106   

SECTION 9.11. Headings

     106   

SECTION 9.12. Confidentiality

     106   

SECTION 9.13. Interest Rate Limitation

     107   

SECTION 9.14. USA PATRIOT Act

     107   

SECTION 9.15. No Fiduciary Duty

     108   

SECTION 9.16. FCC Approval

     108   

SECTION 9.17. Appointment for Perfection; Release of Collateral

     109   

 

iii

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

SCHEDULES:      Schedule 1.01(a)   —      Pricing Schedule Schedule 1.01(b)  
—      Subsidiary Guarantors Schedule 2.01   —      Commitments Schedule 3.05(a)
  —      Owned and Leased Real Property Schedule 3.05(c)   —      Stations
Schedule 3.05(d)   —      Magazines Schedule 3.06(a)   —      Litigation
Schedule 3.06(b)   —      Pending FCC Proceedings Schedule 3.16   —      FCC
Licenses Schedule 3.16(k)   —      Section 73.3555 of the FCC Rules Schedule
3.17   —      Subsidiaries Schedule 6.01   —      Existing Indebtedness Schedule
6.02   —      Existing Liens Schedule 6.03(c)   —      Value of Stations
Schedule 6.04(b)   —      Certain Permitted Investments Schedule 6.04(l)   —  
   Certain Permitted Acquisitions Schedule 6.08   —      Existing Affiliate
Transactions Schedule 6.09   —      Existing Restrictions EXHIBITS:      Exhibit
A   —      Form of Assignment and Assumption Exhibit B-1   —      U.S. Tax
Compliance Certificate (For Foreign Lenders that are not Partnerships for U.S.
Federal Income Tax Purposes) Exhibit B-2   —      U.S. Tax Compliance
Certificate (For Non-U.S. Participants that are not Partnerships for U.S.
Federal Income Tax Purposes) Exhibit B-3   —      U.S. Tax Compliance
Certificate (For Non-U.S. Participants that are Partnerships for U.S. Federal
Income Tax Purposes) Exhibit B-4   —      U.S. Tax Compliance Certificate (For
Foreign Lenders that are Partnerships for U.S. Federal Income Tax Purposes)

 

iv

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

CREDIT AGREEMENT dated as of December 28, 2012, among EMMIS OPERATING COMPANY,
an Indiana corporation, as Borrower, EMMIS COMMUNICATIONS CORPORATION, an
Indiana corporation (the “Parent”), each other CREDIT PARTY from time to time
signatory hereto, the LENDERS party hereto, JPMORGAN CHASE BANK, N.A., as
Administrative Agent, GENERAL ELECTRIC CAPITAL CORPORATION, as Syndication
Agent, and FIFTH THIRD BANK, as Documentation Agent.

The parties hereto agree as follows:

ARTICLE I

Definitions

SECTION 1.01. Defined Terms. As used in this Agreement, the following terms have
the meanings specified below:

“ABR”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are bearing interest at a rate
determined by reference to the Alternate Base Rate.

“Acquisition” means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (a) acquires any going business or all or substantially all
of the assets of any Person or division thereof, whether through purchase of
assets, merger or otherwise or (b) directly or indirectly acquires (in one
transaction or as the most recent transaction in a series of transactions) at
least a majority (in number of votes) of the Equity Interests (to the extent
outstanding and normally entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers, trustees or similar
persons thereof) of any Person.

“Act” has the meaning set forth in Section 9.14.

“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any
Interest Period, an interest rate per annum (rounded upwards, if necessary, to
the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.

“Administrative Agent” means JPMorgan, in its capacity as administrative agent
for the Lenders hereunder.

“Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by the Administrative Agent.

“Affiliate” means, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.

“Agreement” means this Credit Agreement, as amended, restated, modified or
supplemented from time to time.

 

1

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

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus  1/2 of 1% and (c) the Adjusted LIBO Rate for
deposits in Dollars for a one month Interest Period on such day (or if such day
is not a Business Day, the immediately preceding Business Day) plus 1%, provided
that, for the avoidance of doubt, the Adjusted LIBO Rate for any day shall be
based on the rate appearing on the Reuters Screen LIBOR01 Page (or on any
successor or substitute page of such page) at approximately 11:00 a.m. London
time on such day. Any change in the Alternate Base Rate due to a change in the
Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be
effective from and including the effective date of such change in the Prime
Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.

“Applicable Percentage” means, with respect to any Lender, the percentage of the
total Commitments represented by such Lender’s Revolving Commitment; provided
that in the case of Section 2.20 when a Defaulting Lender shall exist,
“Applicable Percentage” shall mean the percentage of the total Revolving
Commitments (disregarding any Defaulting Lender’s Revolving Commitment)
represented by such Lender’s Revolving Commitment. If the Revolving Commitments
have terminated or expired, the Applicable Percentages shall be determined based
upon the Revolving Commitments most recently in effect, giving effect to any
assignments and to any Lender’s status as a Defaulting Lender at the time of
determination.

“Applicable Rate” means, for any day, with respect to any Eurodollar Loan or ABR
Loan or with respect to the commitment fees payable hereunder, the applicable
rate per annum set forth on Schedule 1.01(a) under the caption “Eurodollar
Spread”, “ABR Spread” or “Commitment Fee Rate”, as the case may be, based upon
the Total Leverage Ratio.

“Approved Fund” means any Person (other than a natural person) that is engaged
in making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) the entity or an
Affiliate of an entity that administers or manages a Lender.

“Arrangers” means J.P. Morgan Securities LLC and GE Capital Markets, Inc. in
their respective capacities as joint lead arrangers and joint bookrunners
hereunder.

“Asset Disposition” means any one or a series of related transactions (other
than an Asset Swap) pursuant to which any of the Parent, the Borrower, any
Subsidiary, the Austin Partnership or RAM conveys, sells, leases, licenses or
otherwise transfers or disposes of, directly or indirectly (including by means
of a simultaneous exchange of Stations), any of its properties, businesses or
assets (other than (a) to the Borrower or any Wholly-Owned Subsidiary of the
Borrower, (b) the sale of inventory in the ordinary course or the sale of
obsolete or worn out property in the ordinary course and (c) the sale of
Permitted Investments in the ordinary course of business) whether owned on the
date hereof or thereafter acquired (including the sale of the interest held by
the Borrower or any of its Subsidiaries in the Austin Partnership or in RAM and
the sale or issuance of Equity Interests of any Subsidiary other than to the
Borrower or any Wholly-Owned Subsidiary of the Borrower).

 

2

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

“Asset Swap” means any transfer of assets of any of the Borrower or any
Subsidiary, the Austin Partnership or RAM to any Person other than the Parent,
the Borrower or a Wholly-Owned Subsidiary of the Parent or the Borrower in
exchange for assets of such Person if such exchange would qualify, whether in
part or in full, as a like-kind exchange pursuant to §1031 of the Code. Nothing
in this definition shall require the Parent, the Borrower or any Subsidiary, the
Austin Partnership or RAM to elect that §1031 of the Code be applicable to any
Asset Swap.

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required
by Section 9.04), and accepted by the Administrative Agent, in the form of
Exhibit A or any other form approved by the Administrative Agent and the
Borrower.

“Austin Partnership” means Emmis Austin Radio Broadcasting Company, L.P.
(formerly known as LBJS Broadcasting Company, L.P.), a Texas limited
partnership, and of which RAM is the sole general partner.

“Availability Period” means the period from and including the Effective Date to
but excluding the earlier of the Revolving Maturity Date and the date of
termination of the Revolving Commitments.

“Banking Services” means each and any of the following bank services provided to
any Credit Party by JPMorgan, any Lender or any of their respective Affiliates:
(a) credit cards for commercial customers (including, without limitation,
“commercial credit cards”, purchasing cards and ACH transactions), (b) stored
value cards and (c) treasury management services (including, without limitation,
controlled disbursement, automated clearinghouse transactions, return items,
overdrafts and interstate depository network services).

“Banking Services Obligations” of the Credit Parties means any and all
obligations of the Credit Parties, whether absolute or contingent and howsoever
and whensoever created, arising, evidenced or acquired (including all renewals,
extensions and modifications thereof and substitutions therefor) in connection
with Banking Services.

“Bankruptcy Event” means, with respect to any Person, such Person becomes the
subject of a bankruptcy or insolvency proceeding, or has had a receiver,
conservator, trustee, administrator, custodian, assignee for the benefit of
creditors or similar Person charged with the reorganization or liquidation of
its business appointed for it, or, in the good faith determination of the
Administrative Agent, has taken any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any such proceeding or appointment,
provided that a Bankruptcy Event shall not result solely by virtue of any
ownership interest, or the acquisition of any ownership interest, in such Person
by a Governmental Authority or instrumentality thereof, provided, further, that
such ownership interest does not result in or provide such Person with immunity
from the jurisdiction of courts within the United States or from the enforcement
of judgments or writs of attachment on its assets or permit such Person (or such
Governmental Authority or instrumentality) to reject, repudiate, disavow or
disaffirm any contracts or agreements made by such Person.

 

3

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

“Beneficial Owner” means, with respect to any U.S. Federal withholding Tax, the
beneficial owner, for U.S. Federal income tax purposes, to whom such Tax
relates.

“Board” means the Board of Governors of the Federal Reserve System of the United
States of America.

“Borrower” means Emmis Operating Company, an Indiana corporation.

“Borrowing” means (a) Revolving Loans of the same Type, made, converted or
continued on the same date and, in the case of Eurodollar Loans, as to which a
single Interest Period is in effect, (b) Term Loans of the same Type, made,
converted or continued on the same date and, in the case of Eurodollar Loans, as
to which a single Interest Period is in effect or (c) a Swingline Loan.

“Borrowing Request” means a request by the Borrower for a Borrowing in
accordance with Section 2.03.

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed; provided that, when used in connection with a Eurodollar Loan,
the term “Business Day” shall also exclude any day on which banks are not open
for dealings in Dollar deposits in the London interbank market.

“Capital Assets” means fixed assets, both tangible (such as land, buildings,
fixtures, machinery and equipment) and intangible (such as patents, copyrights,
trademarks, franchises and good will) to the extent such intangible assets have
not been acquired in connection with an Acquisition pursuant to Section 6.04(i);
provided that Capital Assets shall not include any item customarily charged
directly to expense or depreciated over a useful life of twelve (12) months or
less in accordance with GAAP.

“Capital Expenditures” means, without duplication, any expenditure or commitment
to expend money for any purchase or other acquisition of any asset which would
be classified as a fixed or capital asset on a consolidated balance sheet of the
Parent, the Borrower and its Financial Subsidiaries prepared in accordance with
GAAP.

“Capital Lease Obligations” of any Person means the obligations of such Person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP, and the amount of such obligations
shall be the capitalized amount thereof determined in accordance with GAAP.

“CFC” means a “controlled foreign corporation” within the meaning of section
957(a) of the Code.

 

4

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

“CFC Holding Company” means any Domestic Subsidiary of the Borrower
substantially all of the assets of which are one or more CFCs, either directly
or indirectly through other entities that are disregarded entities or
partnerships for U.S. federal income tax purposes, and all such entities have no
material assets (excluding equity interests in each other) other than equity
interests of such CFCs; provided that such entity shall be treated as a CFC
Holding Company only if such entity (and any disregarded entity through which
such entity owns any CFCs) do not have any material liabilities.

“Change in Control” means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the SEC
thereunder as in effect on the date hereof) other than any Permitted Holder, of
Equity Interests representing more than 35% of the aggregate ordinary voting
power represented by the issued and outstanding Equity Interests of the Parent
unless the Permitted Holders own capital stock having a greater percentage of
the general voting power of the outstanding voting capital stock than that held
by such Person or group; (b) occupation of a majority of the seats (other than
vacant seats) on the board of directors of the Parent or the Borrower by Persons
(other than directors on the Effective Date) who were neither (i) nominated by
the board of directors of the Parent or the Borrower, as applicable, nor
(ii) appointed by directors so nominated; (c) the acquisition of direct or
indirect Control of the Parent by any Person or group other than any Permitted
Holder; (d) the Borrower shall at any time (i) cease to own Equity Interests of
any Subsidiary representing the same percentage of outstanding Equity Interests
of such Subsidiary as held by the Borrower on the date hereof or as of any later
date on which any new Subsidiary is created or acquired, unless the diminution
of such percentage is attributable to a disposition of Equity Interests which
was permitted hereunder or (ii) cease to own Equity Interests of any Subsidiary
which enables it at all times to elect a majority of the board of directors of
such Subsidiary unless the disposition of such Equity Interests was permitted
hereunder; (e) the Parent shall cease to directly own one hundred percent
(100%) of the issued and outstanding Equity Interests of the Borrower; or
(f) the occurrence of any “Change of Control” or any similar term under and as
defined in any agreement or indenture governing any Subordinated Indebtedness
having a principal amount in excess of $5,000,000.

“Change in Law” means the occurrence, after the date of this Agreement (or with
respect to any Lender, if later, the date on which such Lender becomes a
Lender), of any of the following: (a) the adoption or taking effect of any law,
rule, regulation or treaty, (b) any change in any law, rule, regulation or
treaty or in the administration, interpretation or application thereof by any
Governmental Authority, or (c) the making or issuance of any request, rules,
guideline, requirement or directive (whether or not having the force of law) by
any Governmental Authority; provided however, that notwithstanding anything
herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer
Protection Act and all requests, rules, guidelines, requirements and directives
thereunder, issued in connection therewith or in implementation thereof, and
(ii) all requests, rules, guidelines, requirements and directives promulgated by
the Bank for International Settlements, the Basel Committee on Banking
Supervision (or any successor or similar authority) or the United States or
foreign regulatory authorities, in each case pursuant to Basel III, shall in
each case be deemed to a “Change in Law” regardless of the date enacted,
adopted, issued or implemented.

“Charges” has the meaning set forth in Section 9.13.

 

5

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

“Class”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are Revolving Loans, Term Loans or
Swingline Loans.

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“Collateral” means “Collateral” as defined in any Collateral Document.

“Collateral Access Agreement” means an agreement in form and substance
reasonably satisfactory to the Administrative Agent pursuant to which a lessor
of real property leased by a Credit Party, acknowledges the Liens of the
Administrative Agent and waives any Liens held by such lessor on such property,
and permits the Administrative Agent reasonable access to and use of such real
property following the occurrence and during the continuance of an Event of
Default to assemble, complete and sell any Collateral stored or otherwise
located thereon.

“Collateral Documents” means, collectively, the Security Agreement, the Pledge
Agreement, each Collateral Access Agreement and any other documents pursuant to
which a Person grants a Lien upon any real or personal property as security for
payment of the Secured Obligations.

“Commitment” means either a Revolving Commitment or a Term Commitment.

“Communications Act” means the Communications Act of 1934, as amended, and the
rules and regulations of the FCC thereunder as now or hereafter in effect.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profits Taxes.

“Consolidated EBITDA” means, for any applicable computation period, the
Parent’s, the Borrower’s and Financial Subsidiaries’ Consolidated Net Income on
a consolidated basis from continuing operations, plus, to the extent included in
the determination of Consolidated Net Income, (a) income and franchise taxes
paid or accrued during such period, (b) Consolidated Total Interest Expense for
such period, (c) amortization and depreciation deducted in determining
Consolidated Net Income for such period, (d) any extraordinary non-cash charges
for such period, (e) any other non-cash charges for such period (but excluding
(A) any non-cash charge in respect of an item that was included in Consolidated
Net Income in a prior period, (B) any non-cash charge that relates to the
write-down or write-off of inventory and (C) income, loss and expenses arising
from or in connection with Trades), (f) expenditures related to ongoing funding
of the Hungarian Litigation to the extent actually incurred and paid or to be
paid in cash for such period in an aggregate amount after the Effective Date not
in excess of $3,000,000 for all such periods and so long as the Borrower has
provided evidence of such expenditures in a form reasonably satisfactory to the
Administrative Agent, (g) expenditures related to ongoing funding of the
litigation with respect to the Parent Preferred Stock to the extent actually
incurred and paid or to be paid in cash for such period in (x) an amount equal
to $400,000 with respect to the Fiscal Quarter ended February 29, 2012;
$1,513,000 with respect to the Fiscal Quarter ended May 31, 2012; $591,000 with
respect to the Fiscal Quarter ended August 31, 2012 and $219,000

 

6

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

with respect to the Fiscal Quarter ended November 30, 2012 and (y) an additional
aggregate amount after November 30, 2012 not in excess of $2,777,000 for all
such periods and so long as the Borrower has provided evidence of such
expenditures in a form reasonable satisfactory to the Administrative Agent,
(h) a one-time add-back for bonus payments paid in cash with respect to the
Merlin transaction on or prior to November 30, 2011 in an amount not in excess
of $1,664,000, (i) a one-time add-back for bonus payments accrued in cash with
respect to the KXOS transaction on or prior to August 31, 2012 in an amount not
in excess of $2,920,000, (j) to the extent paid or to be paid in cash, expenses
incurred in connection with entering into this Agreement and any amendments
thereto, so long as the Borrower has provided evidence of such costs in a form
reasonably satisfactory to the Administrative Agent, (k) transaction costs paid
or to be paid in cash in connection with any Acquisitions or Asset Dispositions
permitted hereunder (whether or not completed) in an aggregate amount not in
excess of $500,000 for all such periods and so long as the Borrower has provided
evidence of such costs in a form reasonably satisfactory to the Administrative
Agent, minus, to the extent included in the determination of Net Income, (i) any
cash payments made during such period in respect of non-cash charges described
in clause (e) above taken in a prior period and (ii) any extraordinary gains and
any non-cash items of income for such period (including, without limitation, any
non-cash gains in connection with the business unit sale of Country Sampler).
For purposes of calculating Consolidated EBITDA for any period, any Acquisition,
Asset Disposition pursuant to Section 6.03(c) or Asset Swap of the Borrower or
any of its Subsidiaries which occurred during such period shall be deemed to
have occurred on the first date of such period and the calculation of
Consolidated EBITDA shall be adjusted on a pro forma basis in connection
therewith.

“Consolidated Excess Cash Flow” means, for any Fiscal Year of the Borrower, the
excess, if any, of (a) the sum, without duplication, of (i) Consolidated Net
Income for such Fiscal Year, (ii) the amount of all non-cash charges (including
depreciation and amortization) deducted in determining such Consolidated Net
Income, (iii) decreases in Working Capital for such Fiscal Year, and (iv) the
aggregate net amount of non-cash loss on the disposition of property by the
Parent, the Borrower and its Financial Subsidiaries during such Fiscal Year, to
the extent deducted in arriving at such Consolidated Net Income, minus (b) the
sum, without duplication, of (i) the amount of all non-cash credits included in
arriving at such Consolidated Net Income, (ii) the aggregate amount actually
paid by the Parent, the Borrower and its Financial Subsidiaries in cash during
such Fiscal Year on account of Capital Expenditures (excluding the principal
amount of Indebtedness incurred in connection with such expenditures and any
such expenditures financed with the proceeds of asset dispositions that have not
yet been used to pay down the Loans), (iii) the aggregate amount of all
regularly scheduled principal payments of Long-Term Debt (including the Term
Loans) of the Parent, the Borrower and its Financial Subsidiaries made during
such Fiscal Year (other than in respect of any revolving credit facility to the
extent there is not an equivalent permanent reduction in commitments
thereunder), (iv) increases in Working Capital for such Fiscal Year, (v) the
aggregate net amount of non-cash gain on the disposition of property by the
Parent, the Borrower and its Financial Subsidiaries during such Fiscal Year
(other than sales of inventory in the ordinary course of business), to the
extent included in determining such Consolidated Net Income, and (vi) to the
extent not subtracted in determining Consolidated Net Income, expenditures
related to ongoing funding of the Hungarian Litigation to the extent actually
incurred and paid or to be paid in cash for such period in an aggregate amount
after the Effective Date not in excess of $3,000,000 (net of any amounts
reserved in a segregated overseas account for such purpose in accordance with
Section 2.11(c)(i)) for all such periods and so long as the Borrower has
provided evidence of such expenditures in a form reasonably satisfactory to the
Administrative Agent.

 

7

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

“Consolidated Fixed Charges” means, with reference to any period, without
duplication, (i) the amount of scheduled principal payments of Long-Term Debt
during such period plus (ii) Capital Lease Obligation payments for such period
plus (iii) the amount of scheduled principal and interest payments made on
Indebtedness during such period (regardless of whether an actual payment is made
in connection therewith) plus (iv) Consolidated Total Interest Expense, all
calculated for the Parent, the Borrower and its Financial Subsidiaries on a
consolidated basis; provided, that for the purpose of determining Consolidated
Fixed Charges for each of the three Fiscal Quarters of the Borrower ending
immediately after (a) the Effective Date, solely with respect to scheduled
interest payments pursuant to this Agreement, clauses (i), (iii) and (iv) of the
definition of “Consolidated Fixed Charges” for the relevant period shall be
deemed to equal such amount for such Fiscal Quarter (and each previous Fiscal
Quarter commencing after the Effective Date) multiplied by 4, 2, and 4/3
respectively and (b) February 28, 2013, solely with respect to scheduled
principal payments pursuant to this Agreement, clauses (i), (iii) and (iv) of
the definition of “Consolidated Fixed Charges” for the relevant period shall be
deemed to equal such amount for such Fiscal Quarter (and each previous Fiscal
Quarter commencing after February 28, 2013) multiplied by 4, 2, and 4/3
respectively. Notwithstanding anything to the contrary contained herein, all
principal and interest payments made pursuant to the Existing Credit Agreement
and the Existing Note Purchase Agreement shall be excluded from the calculation
of Consolidated Fixed Charges.

“Consolidated Net Income” means, for any computation period, with respect to the
Parent, the Borrower and its Financial Subsidiaries on a consolidated basis,
cumulative net income earned during such period as determined in accordance with
GAAP.

“Consolidated Senior Debt” means Consolidated Total Debt minus Subordinated
Indebtedness of the Parent, the Borrower and its Financial Subsidiaries, on a
consolidated basis, calculated in accordance with GAAP.

“Consolidated Total Debt” means (a) all Indebtedness of the Parent, the Borrower
and its Financial Subsidiaries, on a consolidated basis, calculated in
accordance with GAAP plus, without duplication (b) the face amount of all
outstanding letters of credit in respect of which the Parent, the Borrower or
any Financial Subsidiary has any actual or contingent reimbursement obligation
and (c) the principal amount of all Guarantees of Indebtedness made by the
Parent, the Borrower and its Financial Subsidiaries.

“Consolidated Total Interest Expense” means, for any period, total cash interest
expense deducted in the computation of Consolidated Net Income for such period
(including that attributable to Capital Lease Obligations) of the Parent, the
Borrower and its Financial Subsidiaries for such period with respect to all
outstanding Indebtedness of the Parent, the Borrower and its Financial
Subsidiaries (including all commissions, discounts and other fees and charges
owed with respect to letters of credit and bankers’ acceptance financing and net
costs of rate hedging in respect of interest rates to the extent such net costs
are allocable to such period in accordance with GAAP).

 

8

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

“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
“Controlling” and “Controlled” have meanings correlative thereto.

“Corporate Overhead” means (i) accounting and audit costs and expenses incurred
by the Parent in the ordinary course of its business in connection with
preparing consolidated and consolidating financial reports and tax filings,
(ii) fees and expenses incurred by the Parent in connection with SEC and other
regulatory matters, (iii) fees and expenses relating to the corporate
maintenance of the Parent, (iv) outside director fees incurred by the Parent,
(v) costs and expenses payable by the Parent for director and officer insurance
or in connection with pending or threatened legal action, (vi) transfer agent
fees payable in connection with capital stock of the Parent, (vii) proxy
solicitation costs incurred by the Parent, (viii) franchise taxes and other fees
payable to the jurisdictions of incorporation or qualification of the Parent,
(ix) other similar costs and expenses of the Parent incurred in the ordinary
course of conducting its business; provided, that in no event shall Corporate
Overhead include officers’ and other employees’ fees, salaries, bonuses, debt
service and dividends and other distributions in respect of the capital stock of
the Parent.

“CourseLoad” means Courseload, Inc., a Delaware corporation.

“Credit Documents” means this Agreement, the Fee Letters, each promissory note,
if any, delivered pursuant to Section 2.10(e), the Subsidiary Guaranty, the
Parent Guaranty and each Collateral Document, each amendment or waiver thereto
or thereunder and each other document, instrument or agreement executed and
delivered from time to time by any Credit Party (or an Excluded Subsidiary, to
the extent required by the terms of this Agreement or the other Credit
Documents) in connection with or pursuant to the terms of this Agreement or any
other Credit Document.

“Credit Party” means the Parent, the Borrower and each Subsidiary Guarantor.

“Default” means any event or condition which constitutes an Event of Default or
which upon notice, lapse of time or both would, unless cured or waived, become
an Event of Default.

“Defaulting Lender” means any Lender that (a) has failed, within two Business
Days of the date required to be funded or paid, to (i) fund any portion of its
Loans, (ii) fund any portion of its participations in Letters of Credit or
Swingline Loans or (iii) pay over to any Lender Party any other amount required
to be paid by it hereunder, unless, in the case of clause (i) above, such Lender
notifies the Administrative Agent in writing that such failure is the result of
such Lender’s good faith determination that a condition precedent to funding
(specifically identified and including the particular default, if any) has not
been satisfied, (b) has notified the Borrower or any Lender Party in writing, or
has made a public statement to the effect, that it does not intend or expect to
comply with any of its funding obligations under this Agreement (unless such
writing or public statement indicates that such position is based on such
Lender’s good faith determination that a condition precedent (specifically
identified and including the particular default, if any) to funding a loan under
this Agreement cannot be satisfied) or generally under other agreements in which
it commits to extend credit, (c) has failed, within three Business Days after
request by a Lender Party, acting in good faith, to provide a certification in
writing from an authorized officer of such Lender that it will comply with its
obligations (and is financially able to meet such obligations) to fund
prospective Loans and participations in then outstanding Letters of Credit and
Swingline Loans under this Agreement, provided that such Lender shall cease to
be a Defaulting Lender pursuant to this clause (c) upon such Lender Party’s
receipt of such certification in form and substance satisfactory to it and the
Administrative Agent, or (d) has become the subject of a Bankruptcy Event.

 

9

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

“Dollars” or “$” refers to lawful money of the United States of America.

“Domestic Subsidiary” means, as to any Person, each subsidiary of such Person
that is incorporated under the laws of the United States, any State thereof or
the District of Columbia.

“Effective Date” means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).

“Emmis Chief Executive Office” means that certain real property owned by the
Borrower and located at One Emmis Plaza, 40 Monument Circle, Indianapolis,
Indiana 46204.

“Environmental Laws” means all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of natural resources, the
management, release or threatened release of any Hazardous Material or to health
and safety matters.

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

“Equity Interests” means shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person, and any warrants, options
or other rights entitling the holder thereof to purchase or acquire any such
equity interest.

“Equity Issuance” means the sale or issuance (whether by public or private
offering) by the Parent, the Borrower or any Subsidiary of any of its Equity
Interests or any Equity-Like Instrument, other than sales or issuances to the
Parent, the Borrower, any Subsidiary or any trust or other similar entity for
the benefit of the Parent, the Borrower, any Subsidiary or any employee,
director or independent contractor of any of the foregoing.

 

10

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

“Equity-Like Instrument” means any instrument that is equity-like in nature
(including without limitation, preferred stock and any instrument issued
pursuant to the conversion of convertible Indebtedness into Equity Interests),
whether or not such instrument is considered an Equity Interest, which evidences
a residual interest in the issuer or its assets after the payment of all
indebtedness and other liabilities paid prior to equity in accordance with GAAP,
and has no put or similar provisions (except for put or similar provisions
applicable in the event of an asset sale or change of control or for which the
exercise date of such provision is more than six (6) months after the Maturity
Date), no fixed maturity date and no mandatory redemption date, unless such
maturity date or such mandatory redemption date is more than six (6) months
after the Maturity Date. For the avoidance of doubt, nothing contained herein
permitting the existence in any Equity-Like Instrument of put or similar
provisions applicable in the event of an asset sale or change of control shall
be deemed a consent to the making of any payment resulting from the exercise of
such provisions.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
that, together with the Borrower, is treated as a single employer under
Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of
ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (other than an
event for which the 30-day notice period is waived); (b) the withdrawal of the
Borrower or any ERISA Affiliate from a Plan subject to Section 4063 of ERISA
during a plan year in which such entity was a “substantial employer” as defined
in Section 4001(a)(2) of ERISA or a cessation of operations that is treated as
such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d) the filing of a
notice of intent to terminate a Plan or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA; (e) the institution by the PBGC of
proceedings to terminate a Plan; (f) any event or condition that constitutes
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Plan; (g) the determination that any Plan is or
is expected to be an at-risk plan or a plan in endangered or critical status
within the meaning of Sections 430, 431 and 432 of the Code or Sections 303, 304
and 305 of ERISA; (h) the failure by the Borrower or any ERISA Affiliate to make
when due required contributions to a Plan or Multiemployer Plan; (i) the
termination of a Multiemployer Plan under Section 4041A of ERISA or the
reorganization or insolvency of a Multiemployer Plan under Section 4241 or 4245
or ERISA; (j) the loss of a Plan’s qualification or tax-exempt status; (k) the
termination of a Plan described in Section 4064 of ERISA; or (l) the imposition
of any liability under Title IV of ERISA, other than for PBGC premiums due but
not delinquent under Section 4007 of ERISA, upon the Borrower or any ERISA
Affiliate.

“Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Adjusted LIBO Rate.

 

11

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

“Event of Default” has the meaning assigned to such term in Article VII.

“Excluded Subsidiaries” means collectively, (a) each subsidiary of Emmis
International Broadcasting Corporation which is not organized under the laws of
the United States or any state or political subdivision of the United States
unless included at the election of the Borrower upon prior written notice to the
Administrative Agent, (b) Emmis Meadowlands Corporation, Emmis Television
Broadcasting, L.P., Emmis Television License LLC, KMVN, LLC, KMVN License LLC,
Emmis New York Radio License LLC and Emmis New York Radio LLC, and (c) the
Austin Partnership and RAM, in each case, until such subsidiary becomes
wholly-owned by the Borrower and upon prior written notice to the Administrative
Agent. Notwithstanding the foregoing, no Person may be an Excluded Subsidiary
hereunder if (i) it is a “Guarantor” under any indenture or other document or
instrument governing Subordinated Indebtedness or has otherwise guaranteed or
given assurances of payment or performance under or in respect of any
Indebtedness (including Subordinated Indebtedness) of the Parent, the Borrower
or any of the Subsidiaries or (ii) it is a License Subsidiary formed or
organized, as applicable, under the laws of the United States. For the avoidance
of doubt, it is understood and agreed that if Emmis Meadowlands Corporation,
Emmis Television Broadcasting, L.P., Emmis Television License LLC, KMVN, LLC
and/or KMVN License LLC is not dissolved within six months after the Effective
Date, then immediately upon such Person becoming a Credit Party hereunder
pursuant to Section 5.13, such Person shall no longer be deemed an Excluded
Subsidiary.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient or required to be withheld or deducted from a payment to a
Recipient, (a) Taxes imposed on (or measured by) net income (however
denominated), franchise Taxes, and branch profits Taxes, in each case
(i) imposed as a result of such Recipient being organized under the laws of, or
having its principal office or, in the case of any Lender, its applicable
lending office located in, the jurisdiction imposing such Tax (or any political
subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of
a Lender, U.S. Federal withholding Taxes imposed on amounts payable to or for
the account of such Lender with respect to an applicable interest in a Loan or
Commitment pursuant to a law in effect on the date on which (i) such Lender
acquires such interest in the Loan or Commitment (other than pursuant to an
assignment request by the Borrower under Section 2.19(b)) or (ii) such Lender
changes its lending office, except in each case to the extent that, pursuant to
Section 2.17, amounts with respect to such Taxes were payable either to such
Lender’s assignor immediately before such Lender became a party hereto or to
such Lender immediately before it changed its lending office (c) Taxes
attributable to such Recipient’s failure to comply with Section 2.17(f) and
(d) any U.S. Federal withholding Taxes imposed under FATCA.

“Existing Credit Agreement” means the existing Amended and Restated Revolving
Credit Agreement and Term Loan Agreement dated as of November 2, 2006 (as
amended) to which the Borrower and the Parent are a party and for which Bank of
America, N.A. acts as administrative agent, as amended to the date hereof.

“Existing Note Purchase Agreement” means the Note Purchase Agreement dated as of
November 11, 2011 between Emmis Communications Corporation, as Issuer, and Zell
Credit Opportunities Master Fund, L.P., as Purchaser, as amended to the date
hereof.

 

12

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

“FAA” means the Federal Aviation Administration.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with) and any current or future
regulations or official interpretations thereof.

“FCC” means the Federal Communications Commission (or any successor agency,
commission, bureau, department or other political subdivision of the United
States of America).

“FCC License” means any license, permit, certificate of compliance, antenna
structure registration, franchise, approval or authorization granted or issued
by the FCC required in connection with the conduct by Borrower and each of its
Subsidiaries of its Stations as presently operated or proposed to be operated.

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published on the next succeeding Business Day by
the Federal Reserve Bank of New York, or, if such rate is not so published for
any day that is a Business Day, the average (rounded upwards, if necessary, to
the next 1/100 of 1%) of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it.

“Fee Letters” means collectively (a) that certain Agent Fee Letter dated as of
November 27, 2012, by and among JPMorgan, J.P. Morgan Securities LLC and the
Borrower and (b) that certain Joint Fee Letter dated as of November 27, 2012, by
and among JPMorgan, GE Capital, the Arrangers and the Borrower, in each case, as
the same may be amended, restated, modified or supplemented.

“Final FCC Order” means action by the FCC, which action is not reversed, stayed,
enjoined, set aside, annulled or suspended, and with respect to which no
requests for stay, reconsideration, review, rehearing, appeal or certiorari, or
sua sponte action by the FCC is pending, and as to which the time for filing any
such request, petition or appeal, certiorari, or for review by the FCC on its
own motion, has expired or otherwise terminated.

“Financial Affiliate” means a Subsidiary of the bank holding company controlling
any Lender that is engaging in any of the activities permitted by §4(e) of the
Bank Holding Company Act of 1956 (12 U.S.C. §1843).

“Financial Officer” means the chief financial officer, principal accounting
officer, treasurer or controller of the Borrower.

 

13

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

“Financial Subsidiaries” means any Subsidiary of the Borrower (including,
without limitation, the Excluded Subsidiaries) other than Emmis Radio License
Corporation of New York, a California corporation, and each of its Subsidiaries.
Notwithstanding anything to the contrary contained herein and for the avoidance
of doubt, it is understood and agreed that with respect to any financial or
numerical calculation herein (including, without limitation, Consolidated Net
Income) in reference to Financial Subsidiaries, such calculation with respect to
the Austin Partnership, RAM and any other Non-Wholly Owned Subsidiary shall be
calculated only to the extent of the Borrower’s and the Subsidiaries’ aggregate
equity percentage of ownership in the Austin Partnership, RAM or such Non-Wholly
Owned Subsidiary, as applicable.

“Fiscal Quarter” means any of the quarterly accounting periods of the Credit
Parties, ending on February 28, or in the case of a leap year,
February 29, May 31, August 31 and November 30 of each year.

“Fiscal Year” means any of the annual accounting periods of the Credit Parties
ending on February 28, or in the case of a leap year, February 29, of each year.

“Fixed Charge Coverage Ratio” means, the ratio, determined as of the end of each
Fiscal Quarter of the Borrower for the most-recently ended four Fiscal Quarters,
of (a) Consolidated EBITDA for such period minus, without duplication (i) any
Taxes (other than Taxes paid or to be paid in cash in connection with any
Acquisitions or Asset Dispositions permitted hereunder, so long as the Borrower
has provided evidence of such Taxes in a form reasonably satisfactory to the
Administrative Agent and has received the prior written consent of the
Administrative Agent for the exclusion of such Taxes) paid during such period
minus (ii) any Restricted Payments (other than pursuant to Section 6.07(a)(i),
(ii), (v), (vi) and (vii) of this Agreement) made during such period minus
(iii) Capital Expenditures (other than Capital Expenditures paid or to be paid
in cash in connection with any Acquisitions or Asset Dispositions permitted
hereunder, so long as the Borrower has provided evidence of such Capital
Expenditures in a form reasonably satisfactory to the Administrative Agent and
has received the prior written consent of the Administrative Agent for the
exclusion of such Capital Expenditures) made which were not financed with
Long-Term Debt during such period to (b) Consolidated Fixed Charges, all
calculated for the Parent, the Borrower and its Financial Subsidiaries on a
consolidated basis in accordance with GAAP.

“Foreign Lender” means (a) if the Borrower is a U.S. Person, a Lender, with
respect to such Borrower, that is not a U.S. Person, and (b) if the Borrower is
not a U.S. Person, a Lender with respect to such Borrower, that is resident or
organized under the laws of a jurisdiction other than that in which the Borrower
is resident for tax purposes.

“Foreign Pension Plan” means any plan, fund (including, without limitation, any
superannuation fund) or other similar program established or maintained outside
the United States by the Borrower or any one or more of its Subsidiaries
(including the Excluded Subsidiaries) primarily for the benefit of employees of
the Borrower or such Subsidiaries (including the Excluded Subsidiaries) residing
outside the United States, which plan, fund or other similar program provides,
or results in, retirement income, a deferral of income in contemplation of
retirement or payments to be made upon termination or severance of employment,
and which plan is not subject to ERISA or the Code.

 

14

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

“Foreign Subsidiary” means any Subsidiary that is incorporated or organized
under the laws of any jurisdiction other than the United States of America, any
State thereof or the District of Columbia.

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

“GE Capital” means General Electric Capital Corporation.

“Governmental Authority” means any nation or federal or national government, any
state, county or local municipality or other political subdivision thereof and
the governmental or quasi-governmental entity or body associated therewith, and
any agency, instrumentality, court arbitral tribunal or other entity exercising
governmental or quasi-governmental, any executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, any such political
entity or government.

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The amount of any
Guarantee made by any guarantor shall be deemed to be the lower of (a) an amount
equal to the stated or determinable amount of the primary obligation in respect
of which such Guarantee is made and (b) the maximum amount for which such
guarantor may be liable pursuant to the terms of the instrument embodying such
Guarantee, unless (in the case of a primary obligation that is not Indebtedness)
such primary obligation and the maximum amount for which such guarantor may be
liable are not stated or determinable, in which case the amount of such
Guarantee shall be such guarantor’s maximum reasonably anticipated liability in
respect thereof as determined by the Borrower in good faith.

“Guarantor” means the Parent and each Subsidiary Guarantor.

“Guaranty” means, individually and collectively, (a) the Parent Guaranty,
(b) the Subsidiary Guaranty and (c) any other guaranty substantially in the form
of the Subsidiary Guaranty entered into from time to time by a Subsidiary of the
Borrower in favor of the Administrative Agent and the Lenders and the other
holders of the Secured Obligations, in each case, as from time to time amended,
restated or supplemented (by joinder or otherwise).

 

15

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

“Hazardous Materials” means all explosive or radioactive substances or wastes
and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.

“Hostile Acquisition” means the acquisition of the Equity Interests of a Person
(the “Target”) through a tender offer or similar solicitation of the owners of
such Equity Interests which has not been approved prior to such acquisition by
resolutions of the Board of Directors of the Target or by similar action if the
Target is not a corporation (and which approval has not been withdrawn).

“Hungarian Litigation” means arbitration claims filed by Emmis International
Holdings, B.V. and its subsidiaries against Hungary in the International Centre
for Settlement of Investment Disputes (and any enforcement proceedings related
thereto).

“Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money or with respect to deposits or advances of any
kind, (b) all obligations of such Person evidenced by bonds, debentures, notes,
preferred stock (solely to the extent issued after the Effective Date) or
similar instruments, (c) all obligations of such Person upon which interest
charges are customarily paid, (d) all obligations of such Person under
conditional sale or other title retention agreements relating to property
acquired by such Person, (e) all obligations of such Person in respect of the
deferred purchase price of property or services (excluding current accounts
payable incurred in the ordinary course of business), (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the Indebtedness secured thereby has
been assumed, (g) all Guarantees by such Person of Indebtedness of others,
(h) all Capital Lease Obligations of such Person, (i) all obligations,
contingent or otherwise, of such Person as an account party in respect of
letters of credit and letters of guaranty, (j) all obligations, contingent or
otherwise, of such Person in respect of bankers’ acceptances and (k) all
Off-Balance Sheet Liabilities. The Indebtedness of any Person shall include the
Indebtedness of any other entity (including any partnership in which such Person
is a general partner) to the extent such Person is liable therefor as a result
of such Person’s ownership interest in or other relationship with such entity,
except to the extent the terms of such Indebtedness provide that such Person is
not liable therefor.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or
with respect to any payment made by or on account of any obligation of any
Credit Party under any Credit Document and (b) to the extent not otherwise
described in (a), Other Taxes.

“Index Debt” means senior, unsecured, long-term indebtedness for borrowed money
of the Borrower that is not guaranteed by any other Person or subject to any
other credit enhancement.

 

16

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

“Ineligible Institution” means a (a) natural person or (b) holding company,
investment vehicle or trust for, or owned and operated for the primary benefit
of, a natural person or relative(s) thereof; provided that, such holding
company, investment vehicle or trust shall not constitute an ineligible
Institution if it (x) has not been established for the primary purpose of
acquiring any Loans or Commitments, (y) is managed by a professional advisor,
who is not such natural person or a relative thereof, having significant
experience in the business of making or purchasing commercial loans, and (z) has
assets greater than $25,000,000 and a significant part of its activities consist
of making or purchasing commercial loans and similar extensions of credit in the
ordinary course of its business.

“Ineligible Securities” means securities which may not be underwritten or dealt
in by member banks of the Federal Reserve System under Section 16 of the Banking
Act of 1933 (12 U.S.C. §24, Seventh), as amended.

“Information Memorandum” means, collectively, the confidential information
materials dated October 2012 and November 2012 relating to the Borrower and the
Transactions.

“Interest Election Request” means a request by the Borrower to convert or
continue a Revolving Borrowing in accordance with Section 2.08.

“Interest Payment Date” means (a) with respect to any ABR Loan (other than a
Swingline Loan), the first day of each month, (b) with respect to any Eurodollar
Loan, the last day of the Interest Period applicable to the Borrowing of which
such Loan is a part and, in the case of a Eurodollar Borrowing with an Interest
Period of more than three months’ duration, each day prior to the last day of
such Interest Period that occurs at intervals of three months’ duration after
the first day of such Interest Period and (c) with respect to any Swingline
Loan, the day that such Loan is required to be repaid.

“Interest Period” means with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is 7 or 14 days or one, two, three,
six or twelve months thereafter, as the Borrower may elect; provided, that
(i) if any Interest Period would end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day and
(ii) any Interest Period pertaining to a Eurodollar Borrowing that commences on
the last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the last calendar month of such Interest
Period) shall end on the last Business Day of the last calendar month of such
Interest Period. For purposes hereof, the date of a Borrowing initially shall be
the date on which such Borrowing is made and thereafter shall be the effective
date of the most recent conversion or continuation of such Borrowing.

“IRS” means the United States Internal Revenue Service.

“Issuing Bank” means JPMorgan Chase Bank, N.A., in its capacity as the issuer of
Letters of Credit hereunder, and its successors in such capacity as provided in
Section 2.06(i). The Issuing Bank may, in its discretion, arrange for one or
more Letters of Credit to be issued by Affiliates of the Issuing Bank, in which
case the term “Issuing Bank” shall include any such Affiliate with respect to
Letters of Credit issued by such Affiliate.

“JPMorgan” means JPMorgan Chase Bank, N.A.

 

17

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

“LC Disbursement” means a payment made by the Issuing Bank pursuant to a Letter
of Credit.

“LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of
all outstanding Letters of Credit at such time plus (b) the aggregate amount of
all LC Disbursements that have not yet been reimbursed by or on behalf of the
Borrower at such time. The LC Exposure of any Lender at any time shall be its
Applicable Percentage of the total LC Exposure at such time.

“Lender Parent” means, with respect to any Lender, any Person as to which such
Lender is, directly or indirectly, a subsidiary.

“Lender Party” means the Administrative Agent, the Issuing Bank, the Swingline
Lender and each other Lender.

“Lenders” means the Persons listed on Schedule 2.01 and any other Person that
shall have become a party hereto pursuant to Section 2.09(d) or an Assignment
and Assumption, other than any such Person that ceases to be a party hereto
pursuant to an Assignment and Assumption. Unless the context otherwise requires,
the term “Lenders” includes the Swingline Lender.

“Letter of Credit” means any letter of credit issued pursuant to this Agreement.

“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest
Period, the rate appearing on the Reuters Screen LIBOR01 Page 1 (or on any
successor or substitute page of such Service, or any successor to or substitute
for such Service, providing rate quotations comparable to those currently
provided on such page of such Service, as determined by the Administrative Agent
from time to time for purposes of providing quotations of interest rates
applicable to Dollar deposits in the London interbank market) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period, as the rate for Dollar deposits with a maturity comparable to
such Interest Period. In the event that such rate is not available at such time
for any reason, then the “LIBO Rate” with respect to such Eurodollar Borrowing
for such Interest Period shall be the rate at which Dollar deposits of
$5,000,000 and for a maturity comparable to such Interest Period are offered by
the principal London office of the Administrative Agent in immediately available
funds in the London interbank market at approximately 11:00 a.m., London time,
two Business Days prior to the commencement of such Interest Period.

“License Subsidiaries” means collectively, (a) Emmis License Corporation of New
York, Emmis Radio License Corporation, Emmis Radio License Corporation of New
York, and Emmis Radio License, LLC and (b) any new Subsidiaries that hold
licenses to broadcast or transmit radio or television signals formed or acquired
in connection with any Acquisition permitted under Section 6.04, or any internal
reorganization permitted pursuant to Section 6.03(a).

 

18

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

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement (or any financing lease
having substantially the same economic effect as any of the foregoing) relating
to such asset and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.

“LMA Agreement” means any agreement pursuant to which a Person unaffiliated with
Borrower or any of its Subsidiaries acquires the right to program substantially
all of the time and/or to sell the advertising spots of a Station or to
otherwise provide services substantially related to the programming, staffing or
financial operations of a Station in exchange for cash consideration or other
consideration, entered into, directly or indirectly, between the Borrower or any
of its Subsidiaries, on the one hand, and any Person other than the Parent, the
Borrower or any of its Subsidiaries or their respective Affiliates, on the other
hand.

“Loans” means the loans made by the Lenders to the Borrower pursuant to this
Agreement.

“Loan Year” means each 12-month period commencing on the Effective Date and on
each anniversary of the Effective Date.

“Long-Term Debt” means any Indebtedness that, in accordance with GAAP,
constitutes (or, when incurred, constituted) a long-term liability.

“Magazine” all of the properties, assets and operating rights (including but not
limited to any ancillary publications) constituting a system for publishing a
magazine, including, without limitation, on-line publications of such magazine.

“Material Adverse Effect” means a material adverse effect on (a) the business,
assets, operations, condition (financial or otherwise) or income, of the Parent
and its Subsidiaries taken as a whole, (b) the ability of the Borrower or any
other Credit Parties to perform their respective obligations under this
Agreement or any other Credit Document to which it is a party, (c) the
Collateral or the Administrative Agent’s Liens (on behalf of itself and the
Secured Creditors) on the Collateral or the priority of such Liens or (d) the
rights of or benefits available to the Administrative Agent, the Issuing Bank or
the Lenders under this Agreement or any other Credit Document.

“Material Indebtedness” means Indebtedness (other than the Loans, Letters of
Credit, and any Guaranty under the Credit Documents), or obligations in respect
of one or more Swap Agreements, of any one or more of the Credit Parties and
their Subsidiaries in an aggregate principal amount exceeding $5,000,000 or any
Indebtedness with respect to the Austin Partnership or RAM in an aggregate
principal amount exceeding $750,000. For purposes of determining Material
Indebtedness, the “principal amount” of the obligations any Credit Party, any
Subsidiary, the Austin Partnership or RAM in respect of any Swap Agreement at
any time shall be the maximum aggregate amount (giving effect to any netting
agreements) that the Borrower or such Subsidiary would be required to pay if
such Swap Agreement were terminated at such time.

“Maximum Rate” has the meaning set forth in Section 9.13.

 

19

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

“Moody’s” means Moody’s Investors Service, Inc. and any successor to its rating
agency business.

“Mortgages” means any mortgage, deed of trust or other agreement which conveys
or evidences a Lien in favor of the Administrative Agent, for the benefit of the
Administrative Agent, the Lenders and other holders of the Secured Obligations,
on real property of a Credit Party, including any amendment, modification or
supplement thereto.

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3)
of ERISA, as to which the Borrower or any ERISA Affiliate incurs or otherwise
has any obligation or liability, contingent or otherwise.

“Necessary Authorization” means (i) other than FCC Licenses, any license,
permit, consent, franchise, order, approval or authorization from, or any
filing, recording or registration with, any Governmental Authority reasonably
necessary to the conduct of any business of the Borrower or any of its
Subsidiaries substantially as such business is currently conducted or for the
ownership, maintenance and operation by such Person of its Stations and other
properties substantially as such Stations and other properties are currently
operated or to the performance by such Person of its obligations under any LMA
Agreement substantially as such obligations are currently performed and
(ii) with respect to FCC Licenses, any main station FCC License held by the
Borrower or its Subsidiaries.

“Net Available Proceeds” means (a) with respect to any Asset Disposition or
Asset Swap, the sum of cash or readily marketable cash equivalents received
(including by way of a cash generating sale or discounting of a note or
receivable, but excluding (i) any other consideration received in the form of
assumption by the acquiring Person of debt or other obligations relating to the
properties or assets so disposed of or received in any other non-cash form and
(ii) an aggregate amount of reasonable reserves not in excess of five percent of
the sum of cash or readily marketable cash equivalents received with respect to
any such Asset Disposition or Asset Swap established in accordance with GAAP
against any adjustment to the sale price or any liabilities plus any additional
amounts agreed to in writing by the Administrative Agent in its sole discretion
(x) related to any of the applicable assets and (y) retained by the Borrower or
any of its Subsidiaries including, without limitation, pension plan and other
post-employment benefit liabilities and liabilities related to environmental
matters or against any indemnification obligations (however, the amount of any
subsequent reduction of such reserve (other than in connection with a payment in
respect of any such liability) shall be deemed to be Net Available Proceeds of
such Asset Disposition occurring on the date of such reduction)) therefrom,
whether at the time of such disposition or subsequent thereto, or (b) with
respect to any sale or issuance of equity securities of any Credit Party or any
Financial Subsidiary, cash or readily marketable cash equivalents received (but
excluding any other non-cash form) therefrom, whether at the time of such
disposition, sale or issuance or subsequent thereto, net, in either case, of all
legal, title and recording tax expenses, commissions and other fees and all
costs and expenses incurred and all federal, state, local and other taxes
required to be accrued as a liability as a consequence of such transactions and,
in the case of an Asset Disposition or Asset Swap, net of all payments made by
any Credit Party or any Financial Subsidiary on any Indebtedness which is
secured by such assets pursuant to a Lien permitted under Section 6.02 upon or
with respect to such assets or which must by the terms of such Lien, in order to
obtain a necessary consent to such Asset Disposition or Asset Swap or by
applicable law be repaid out of the proceeds from such Asset Disposition or
Asset Swap.

 

20

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

“Non-Wholly Owned Subsidiary” means any Subsidiary (including Excluded
Subsidiaries) that is not a Wholly-Owned Subsidiary.

“Obligations” means all unpaid principal of and accrued and unpaid interest on
the Loans, the LC Exposure and all other liabilities (if any), whether actual or
contingent, of the Credit Parties with respect to Letters of Credit, all accrued
and unpaid fees and all expenses, reimbursements, indemnities and other
obligations of the Credit Parties to the Lenders or to any Lender, the
Administrative Agent or any indemnified party hereunder arising under any of the
Credit Documents.

“Off-Balance Sheet Liability” of a Person means (a) any repurchase obligation or
liability of such Person with respect to accounts or notes receivable sold by
such Person, (b) any liability under any Sale and Leaseback Transaction other
than Capital Lease Obligations, (c) any liability under any so-called “synthetic
lease” arrangement or transaction entered into by such Person, or (d) any
obligation arising with respect to any other transaction which is the functional
equivalent of or takes the place of borrowing but which does not constitute a
liability on the balance sheets of such Person.

“Operating Subsidiaries” means collectively, as of the Effective Date, (a) Emmis
Radio Corporation, Emmis Publishing Corporation, Mediatex Communications
Corporation, and Los Angeles Magazine Holding Company, Inc., each an Indiana
corporation; (b) Emmis Radio, LLC, an Indiana limited liability company;
(c) Emmis International Broadcasting Corporation, a California corporation;
(d) the Partnership Subsidiaries and their successors; and (e) any new
Subsidiaries acquired in connection with any Permitted Acquisition or formed in
connection with any internal reorganization permitted pursuant to
Section 6.03(a) and used to hold assets (other than broadcast licenses).

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Taxes (other than a connection arising from such
Recipient having executed, delivered, enforced, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Credit Document, or sold or assigned an interest in any Loan or Credit
Document).

“Other Taxes” means any present or future stamp, court, documentary, intangible,
recording, filing or similar excise or property Taxes that arise from any
payment made under, from the execution, delivery, performance, enforcement or
registration of, or from the registration, receipt or perfection of a security
interest under, or otherwise with respect to, any Credit Document, except any
such Taxes that are Other Connection Taxes imposed with respect to an assignment
(other than an assignment under Section 2.19(b)).

“Parent” has the meaning set forth in the preamble hereto.

 

21

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

“Parent Preferred Stock” means the preferred stock of the Parent issued and
outstanding as of the Effective Date.

“Parent Guaranty” means that certain Parent Guaranty dated as of the date hereof
by the Parent in favor of the Administrative Agent for the benefit of the
Lenders and the other holders of the Secured Obligations, as the same may be
amended, restated, modified or supplemented from time to time.

“Participant” has the meaning set forth in Section 9.04(c).

“Participant Register” has the meaning set forth in Section 9.04(c).

“Partnership Subsidiaries” means collectively, Emmis Indiana Broadcasting, L.P.
and Emmis Publishing, L.P., each an Indiana limited partnership.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA and any successor entity performing similar functions.

“Permitted Encumbrances” means:

(a) Liens imposed by law for Taxes that are not yet due or are being contested
in compliance with Section 5.04;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other
like Liens imposed by law, arising in the ordinary course of business and
securing obligations that are not overdue by more than 30 days or are being
contested in compliance with Section 5.04;

(c) pledges and deposits made in the ordinary course of business in compliance
with workers’ compensation, unemployment insurance and other social security
laws or regulations;

(d) deposits to secure the performance of bids, trade contracts, leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature, in each case in the ordinary course of business;

(e) judgment liens in respect of judgments that do not constitute an Event of
Default under clause (k) of Article VII;

(f) easements, zoning restrictions, rights-of-way and similar encumbrances on
real property imposed by law or arising in the ordinary course of business that
do not secure any monetary obligations and do not materially detract from the
value of the affected property or interfere with the ordinary conduct of
business of the Borrower or any Subsidiary;

(g) leases or licenses of intellectual property, broadcast tower space,
broadcast subchannels, broadcast spectrum or similar assets entered into in the
ordinary course of business and consistent with past practices, which do not
interfere in any material respect with the business of any Credit Party or any
Subsidiary; and

 

22

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

(h) leases or subleases of Real Estate in the ordinary course of business and
consistent with past practices, which do not interfere in any material respect
with the business of any Credit Party or any Subsidiary.

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

“Permitted Holders” means Jeffrey Smulyan, his spouse, his children, his
grandchildren, his estate and trusts created for the benefit of any of the
foregoing.

“Permitted Investments” means:

(a) direct obligations of, or obligations the principal of and interest on which
are unconditionally guaranteed by, the United States of America (or by any
agency thereof to the extent such obligations are backed by the full faith and
credit of the United States of America), in each case maturing within one year
from the date of acquisition thereof;

(b) investments in commercial paper maturing within 270 days from the date of
acquisition thereof and having, at such date of acquisition, the highest credit
rating obtainable from S&P or from Moody’s;

(c) investments in certificates of deposit, banker’s acceptances and time
deposits maturing within 180 days from the date of acquisition thereof issued or
guaranteed by or placed with, and money market deposit accounts issued or
offered by, any domestic office of any commercial bank organized under the laws
of the United States of America or any State thereof which has a combined
capital and surplus and undivided profits of not less than $500,000,000;

(d) fully collateralized repurchase agreements with a term of not more than 30
days for securities described in clause (a) above and entered into with a
financial institution satisfying the criteria described in clause (c) above; and

(e) money market funds that (i) comply with the criteria set forth in SEC Rule
2a-7 under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa
by Moody’s and (iii) have portfolio assets of at least $5,000,000,000.

“Permitted Refinancing” means Indebtedness constituting a refinancing or
extension of Indebtedness permitted under Sections 6.01(b) and (h) that (A) has
an aggregate outstanding principal amount not greater than the aggregate
principal amount of the Indebtedness being refinanced or extended, plus, subject
to the consent of the Administrative Agent which consent shall not be
unreasonably withheld, reasonable and customary costs, expenses, interest, or
premiums in connection with such refinancing, (B) has a weighted average
maturity (measured as of the date of such refinancing or extension) and maturity
no shorter than that of the Indebtedness being refinanced or extended, (C) is
not entered into as part of a sale leaseback transaction, (D) is not secured by
a Lien on any assets other than the collateral securing the Indebtedness being
refinanced or extended, (E) the obligors of which are the same as the obligors
of the Indebtedness being refinanced or extended and (F) is otherwise on terms
no less favorable to the Credit Parties and their Subsidiaries, taken as a
whole, than those of the Indebtedness being refinanced or extended.

 

23

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

“Person” means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA, and as to which Borrower or any ERISA Affiliate may have
any liability, including liability by reason of having been a substantial
employer within the meaning of Section 4063 of ERISA at any time during the
prior five years, or by reason of being deemed a contributing sponsor under
Section 4069 of ERISA

“Pledge Agreement” means that certain Pledge Agreement, dated as of the date
hereof, between the Credit Parties and the Administrative Agent, for the benefit
of the Administrative Agent, the Lenders and the other holders of the Secured
Obligations, and any other pledge agreement entered into, after the date of this
Agreement by any other Credit Party (as required by this Agreement or any other
Credit Document) or any other Person, as the same may be amended, restated or
otherwise modified from time to time.

“Prime Rate” means the rate of interest per annum publicly announced from time
to time by JPMorgan Chase Bank, N.A. as its prime rate in effect at its office
located at 270 Park Avenue, New York, New York; each change in the Prime Rate
shall be effective from and including the date such change is publicly announced
as being effective.

“RAM” means Radio Austin Management, L.L.C., the sole general partner of the
Austin Partnership, which is and shall remain a single purpose entity whose sole
material asset is the general partnership interest in the Austin Partnership.

“Recipient” means, as applicable, (a) the Administrative Agent, (b) any Lender
and (c) the Issuing Bank.

“Register” has the meaning set forth in Section 9.04.

“Related Parties” means, with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, employees, agents and
advisors of such Person and such Person’s Affiliates.

“Replacement Lender” has the meaning set forth in Section 9.02(d).

“Required Lenders” means, at any time, Lenders having Revolving Credit
Exposures, unused Commitments and outstanding Term Loans representing more than
50% of the sum of the total Revolving Credit Exposures, unused Commitments and
outstanding Term Loans at such time.

“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in the
Parent, the Borrower or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit, on
account of the purchase, redemption, retirement, acquisition, cancellation or
termination of any such Equity Interests in the Borrower or any Subsidiary or
any option, warrant or other right to acquire any such Equity Interests in the
Borrower or any Subsidiary.

 

24

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

“Revolving Borrowing” means a Borrowing comprised of Revolving Loans.

“Revolving Commitment” means, with respect to each Lender, the commitment of
such Lender to make Revolving Loans and to acquire participations in Letters of
Credit and Swingline Loans hereunder, expressed as an amount representing the
maximum aggregate amount of such Lender’s Revolving Credit Exposure hereunder,
as such commitment may be (a) reduced or increased from time to time pursuant to
Section 2.09 and (b) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 9.04. The initial amount of
each Lender’s Revolving Commitment is set forth on Schedule 2.01, or in the
Assignment and Assumption pursuant to which such Lender shall have assumed its
Revolving Commitment, as applicable. The initial aggregate amount of the
Lenders’ Revolving Commitments is $20,000,000.

“Revolving Credit Exposure” means, with respect to any Lender at any time, the
sum of the outstanding principal amount of such Lender’s Revolving Loans and its
LC Exposure and Swingline Exposure at such time.

“Revolving Loan” means a Loan made pursuant to Section 2.01(a).

“Revolving Maturity Date” means December 28, 2017.

“S&P” means Standard & Poor’s Financial Services LLC and any successor to its
rating agency business.

“Sale and Leaseback Transaction” means any sale or other transfer of property by
any Person with the intent to lease such property as lessee.

“SEC” Securities and Exchange Commission.

“Secured Creditors” shall have the meaning ascribed that term in the respective
Collateral Documents.

“Secured Obligations” means all Obligations, together with all Banking Services
Obligations and Swap Obligations owing to one or more Lenders or their
respective Affiliates.

“Security Agreement” means that certain Security Agreement, dated as of the date
hereof, between the Credit Parties and the Administrative Agent, for the benefit
of the Administrative Agent, the Lenders and the other holders of the Secured
Obligations, and any other security agreement entered into, after the date of
this Agreement by any other Credit Party (as required by this Agreement or any
other Credit Document) or any other Person, as the same may be amended, restated
or otherwise modified from time to time.

“Senior Leverage Ratio” means at any time, the ratio of Consolidated Senior Debt
at such time to Consolidated EBITDA for the most recently completed four Fiscal
Quarters of the Borrower, computed on a consolidated basis for the Parent, the
Borrower and its Financial Subsidiaries.

 

25

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

“Station” means the properties, assets and operating rights constituting a
system for transmitting radio or television signals from a transmitter and any
ancillary facilities licensed by the FCC or foreign Governmental Authority with
comparable authority to the FCC and operated by the Borrower or its Subsidiaries
(including Financial Subsidiaries), together with any subsystem which is
ancillary to such system and including all the Stations set forth on
Schedule 3.05(c) hereto.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject with
respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred
to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve
percentages shall include those imposed pursuant to such Regulation D.
Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D or any comparable regulation. The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in
any reserve percentage.

“Subordinated Indebtedness” means Indebtedness of any Credit Party or any
Subsidiary of any Credit Party which is subordinated to the Obligations as to
right and time of payment and as to other rights and remedies thereunder and
having such other terms as are, in each case, satisfactory to the Administrative
Agent; provided that the material terms and conditions of such Subordinated
Indebtedness are no more restrictive than the terms and conditions set forth in
this Agreement with respect to the Obligations and otherwise reasonably
acceptable to the Administrative Agent; provided, further that the
Administrative Agent shall have received from the Borrower a certificate from
the principal Financial Officer of the Borrower or the Parent, as applicable,
certifying that the Obligations of the Borrower and its Subsidiaries arising
under this Credit Agreement and the other Credit Documents constitute “Senior
Debt” under and as defined in the definitive documentation governing such
Subordinated Indebtedness, and the incurrence of the Obligations is permitted
under the definitive documentation governing such Subordinated Indebtedness and
will not cause a “Default” or “Event of Default” under and as defined in such
definitive documentation.

“subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than 50%
of the equity or more than 50% of the ordinary voting power or, in the case of a
partnership, more than 50% of the partnership interests are, as of such date,
owned, controlled or held, or (b) that is, as of such date, otherwise
Controlled, by the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent.

 

26

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

“Subsidiary” means any direct or indirect subsidiary of the Parent and the
Borrower other than Excluded Subsidiaries, except as otherwise expressly
provided herein.

“Subsidiary Guarantor” means each Subsidiary of the Borrower which is a party to
the Subsidiary Guaranty.

“Subsidiary Guaranty” means the Subsidiary Guaranty dated as of the date hereof
made by the Subsidiaries party thereto in favor of the Secured Creditors, as the
same may be amended, restated, amended and restated, modified or supplemented
from time to time (including any future joinders from time to time thereto). The
Subsidiary Guarantors party to the Subsidiary Guaranty as of the Effective Date
are so designated on Schedule 1.01(b) hereto.

“Substantial Portion” means, with respect to the property of the Borrower and
its Subsidiaries, property which (a) represents more than 10% of the
consolidated assets of the Borrower and its Subsidiaries as would be shown in
the consolidated financial statements of the Borrower and its Subsidiaries as at
the beginning of the twelve-month period ending with the month in which such
determination is made, or (b) is responsible for more than 10% of the
consolidated net sales or of the consolidated net income of the Borrower and its
Subsidiaries as reflected in the financial statements referred to in clause
(a) above.

“Swap Agreement” means any agreement with respect to any swap, forward, spot,
future, credit default or derivative transaction or option or similar agreement
involving, or settled by reference to, one or more rates, currencies,
commodities, equity or debt instruments or securities, or economic, financial or
pricing indices or measures of economic, financial or pricing risk or value or
any similar transaction or any combination of these transactions; provided that
no phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of the Borrower or the Subsidiaries shall be a Swap Agreement.

“Swap Obligations” of a Credit Party means any and all obligations of such
Credit Party, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (a) any and all Swap
Agreements, and (b) any and all cancellations, buy backs, reversals,
terminations or assignments of any Swap Agreement transaction.

“Swingline Exposure” means, at any time, the aggregate principal amount of all
Swingline Loans outstanding at such time. The Swingline Exposure of any Lender
at any time shall be its Applicable Percentage of the total Swingline Exposure
at such time.

“Swingline Lender” means JPMorgan Chase Bank, N.A., in its capacity as lender of
Swingline Loans hereunder.

“Swingline Loan” means a Loan made pursuant to Section 2.05.

 

27

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

“Syndication Agent” means GE Capital, in its capacity as syndication agent for
the Lenders hereunder.

“Taxes” means any present or future taxes, levies, imposts, duties, deductions,
withholdings (including backup withholding), assessments, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax
or penalties applicable thereto.

“Telecom Business” means business related to FM receiver and mobile devices,
including supporting software and back office transmitters used in connection
therewith, but excluding fixed line and reseller telecom businesses.

“Term Borrowing” means a Borrowing comprised of Term Loans.

“Term Commitment” means, with respect to each Lender, the commitment of such
Lender to make a Term Loan hereunder, expressed as an amount representing the
maximum aggregate principal amount of such Lender’s Term Loan. The amount of
each Lender’s Term Commitment is set forth on Schedule 2.01. The aggregate
amount of the Lenders’ Term Commitments is $80,000,000.

“Term Loan” means, with respect to each Lender, such Lender’s pro-rata portion
of the term loan Borrowing made by the Lenders pursuant to Section 2.01(b) and,
with respect to all Lenders, the aggregate of all such pro-rata portions.

“Term Maturity Date” means December 28, 2017.

“Total Leverage Ratio” means at any time, the ratio of Consolidated Total Debt
at such time to Consolidated EBITDA for the most recently completed four Fiscal
Quarters of the Borrower, computed on a consolidated basis for the Parent, the
Borrower and its Financial Subsidiaries.

“Trades” means those assets and liabilities of the Borrower and any of its
Subsidiaries which do not represent the right to receive payment in cash or the
obligation to make payment in cash and which arise pursuant to so-called trade
or barter transactions.

“Transactions” means the execution, delivery and performance by the Borrower of
this Agreement and the other Credit Documents, the borrowing of Loans and other
credit extensions, the use of the proceeds thereof and the issuance of Letters
of Credit hereunder.

“Type”, when used in reference to any Loan or Borrowing, refers to whether the
rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.

“UCC” means the Uniform Commercial Code as in effect from time to time in the
State of New York or any other state the laws of which are required to be
applied in connection with the issue of perfection of security interests.

“U.S. Person” means a “United States person” within the meaning of
Section 7701(a)(30) of the Code.

 

28

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

“U.S. Tax Compliance Certificate” has the meaning assigned to such term in
Section 2.17(f)(ii)(B)(3).

“Wholly-Owned Subsidiary” of a Person means (a) any subsidiary all of the
outstanding voting securities of which shall at the time be owned or controlled,
directly or indirectly, by such Person or one or more Wholly-Owned Subsidiaries
of such Person, or by such Person and one or more Wholly-Owned Subsidiaries of
such Person, or (b) any partnership, limited liability company, association,
joint venture or similar business organization 100% of the ownership interests
having ordinary voting power of which shall at the time be so owned or
controlled (other than in the case of Foreign Subsidiaries, director’s
qualifying shares and/or other nominal amounts of shares required to be held by
Persons other than the Borrower and its Subsidiaries under applicable law).

“Withholding Agent” means any Credit Party and the Administrative Agent.

“Working Capital” means, at any date, the excess of current assets of the
Parent, the Borrower and its Financial Subsidiaries on such date over current
liabilities of the Parent, the Borrower and its Financial Subsidiaries on such
date, all determined on a consolidated basis in accordance with GAAP.

SECTION 1.02. Classification of Loans and Borrowings. For purposes of this
Agreement, Loans may be classified and referred to by Class (e.g., a “Revolving
Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a
“Eurodollar Revolving Loan”). Borrowings also may be classified and referred to
by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “Eurodollar
Borrowing”) or by Class and Type (e.g., a “Eurodollar Revolving Borrowing”).

SECTION 1.03. Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”. The word “will”
shall be construed to have the same meaning and effect as the word “shall”.
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
restated, supplemented or otherwise modified (subject to any restrictions on
such amendments, supplements or modifications set forth herein), (b) any
reference herein to any Person shall be construed to include such Person’s
successors and assigns, (c) the words “herein”, “hereof” and “hereunder”, and
words of similar import, shall be construed to refer to this Agreement in its
entirety and not to any particular provision hereof, (d) all references herein
to Articles, Sections, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Exhibits and Schedules to, this Agreement and
(e) any reference in any definition to the phrase “at any time” or “for any
period” shall refer to the same time or period for all calculations or
determinations within such definition, and (f) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.

 

29

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

SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided that, if the
Borrower notifies the Administrative Agent that the Borrower requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith. Notwithstanding any
other provision contained herein, all terms of an accounting or financial nature
used herein shall be construed, and all computations of amounts and ratios
referred to herein shall be made, (i) without giving effect to any election
under Accounting Standards Codification 825 (previously referred to as Statement
of Financial Accounting Standards 159) (or any other Accounting Standards
Codification or update having a similar result or effect) to value any
Indebtedness or other liabilities of the Borrower or any Subsidiary at “fair
value”, as defined therein, (ii) without giving effect to any treatment of
Indebtedness in respect of convertible debt instruments under Accounting
Standards Codification 470-20 (or any other Accounting Standards Codification or
update having a similar result or effect) to value any such Indebtedness in a
reduced or bifurcated manner as described in such provision, and such
Indebtedness shall at all times be valued at the full stated principal amount
thereof and (iii) in a manner such that any obligations relating to a lease
that, in accordance with GAAP as in effect on the Effective Date, would be
accounted for by the Borrower as an operating lease shall be accounted for as
obligations relating to an operating lease and not as obligations relating to a
Capitalized Lease (and shall not constitute Indebtedness hereunder).

SECTION 1.05. Pro Forma Calculations. In connection with any Acquisition, Asset
Disposition pursuant to Section 6.03(c) or Asset Swap, the calculation of
compliance with the financial covenants set forth in Sections 6.14, 6.15 and
6.16 or the determination of various ratios described in such sections by the
Borrower and its Subsidiaries shall include the business, business division or
Person acquired in connection with any Acquisition or Asset Swap as if such
business, business division or Person were a Subsidiary and after excluding any
business, business division or Person sold or otherwise disposed of in
connection with any such Asset Disposition or Asset Swap. The calculation of
such compliance shall be determined as of the most recently ended Fiscal Quarter
by reference to the financial results of the Borrower and its Subsidiaries for
such Fiscal Quarter after adjusting the same to (i) exclude the financial
results attributable to any business, business division or Person sold or
otherwise disposed of as if such transaction occurred on the first day of such
Fiscal Quarter and (ii) include the audited financial results of any business,
business division or Person acquired, if available for such Fiscal Quarter, or
if such audited financial results are not available for such Fiscal Quarter, any
unaudited financial results or any management reports as are approved by the
Administrative Agent in respect of such business, business division or Person,
as if such Acquisition or Asset Swap had occurred on the first day of such
Fiscal Quarter and including the adjustments described in clauses (a), (b), (c),
(d), and (e) below:

(a) all Indebtedness (whether under this Agreement or otherwise) and any other
balance sheet adjustments incurred, made or assumed in connection with an
Acquisition or Asset Swap shall be deemed to have been incurred, made or assumed
on the first day of the Fiscal Quarter, and all Indebtedness of the Person
acquired in such Acquisition or Asset Swap or which is attributable to the
business or business division acquired which was repaid in connection with the
consummation of the Acquisition or Asset Swap shall be deemed to have been
repaid on the first day of the Fiscal Quarter;

 

30

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

(b) all Indebtedness assumed to have been incurred pursuant to the preceding
clause (a) in connection with an Acquisition or Asset Swap shall be deemed to
have borne interest at (i) the arithmetic mean of (A) the Adjusted LIBO Rate for
Eurodollar Loans having an Interest Period of one (1) month in effect on the
first day of the Fiscal Quarter and (B) the Adjusted LIBO Rate for Eurodollar
Loans having an Interest Period of one (1) month in effect on the last day of
the Fiscal Quarter plus (ii) the Applicable Rate with respect to Revolving Loans
which are Eurodollar Loans then in effect (after giving effect to the
Acquisition or Asset Swap on a pro forma basis);

(c) any interest paid in connection with Indebtedness which was repaid or
prepaid in connection with an Acquisition, Asset Disposition or Asset Swap or
will have been repaid or prepaid within 10 days thereafter shall be excluded in
the pro forma calculation of the financial covenants set forth in Sections 6.14,
6.15 and 6.16 (i.e., treated as though such interest expense had not been
incurred);

(d) all Indebtedness which is has been repaid or prepaid in connection with such
Asset Disposition or is to be repaid within 10 days thereafter (and as to any
prior Asset Sales which occurred during such Fiscal Quarter) shall be deemed to
have been repaid on the first day of the Fiscal Quarter; and

(e) for purposes of calculating Consolidated EBITDA for the Fiscal Quarter,
other reasonable cost savings, expenses and other income statement, or operating
statement adjustments as may be approved by the Administrative Agent in writing
which are attributable to the change in ownership and/or management resulting
from such Acquisition or Asset Swap (including the amount of any pre-acquisition
management fees paid during such period in connection with the operation of any
Station subject to such Acquisition or Asset Swap to the extent such fees are
not payable after such transaction) shall be deemed to have been realized on the
first day of the Fiscal Quarter, provided that the Administrative Agent shall be
under no obligation to approve such cost savings, expenses or other adjustments.

ARTICLE II

The Credits

SECTION 2.01. Commitments. (a) Subject to the terms and conditions set forth
herein, each Lender agrees to make Revolving Loans to the Borrower from time to
time during the Availability Period in an aggregate principal amount that will
not result in (i) such Lender’s Revolving Credit Exposure exceeding such
Lender’s Revolving Commitment or (ii) the sum of the total Revolving Credit
Exposures exceeding the total Revolving Commitments. Within the foregoing limits
and subject to the terms and conditions set forth herein, the Borrower may
borrow, prepay and reborrow Revolving Loans.

 

31

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

(b) Subject to the terms and conditions set forth herein, each Lender agrees to
make a Term Loan to the Borrower on the date of the initial Borrowing in a
principal amount that will not result in (a) such Lender’s Term Loan exceeding
such Lender’s Term Commitment or (b) the sum of the Term Loans exceeding the
total Term Commitments. No amount of the Term Loan which is repaid or prepaid by
the Borrower may be reborrowed hereunder.

SECTION 2.02. Loans and Borrowings. (a) Each Revolving Loan shall be made as
part of a Borrowing consisting of Revolving Loans made by the Lenders ratably in
accordance with their respective Revolving Commitments. Each Term Loan shall be
made as part of a Borrowing consisting of Term Loans made by the Lenders ratably
in accordance with their respective Term Commitments. The failure of any Lender
to make any Loan required to be made by it shall not relieve any other Lender of
its obligations hereunder; provided that the Commitments of the Lenders are
several and no Lender shall be responsible for any other Lender’s failure to
make Loans as required.

(b) Subject to Section 2.14, each Revolving Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith. Each Swingline Loan shall be an ABR Loan. Each Lender at
its option may make any Eurodollar Loan by causing any domestic or foreign
branch or Affiliate of such Lender to make such Loan; provided that any exercise
of such option shall not affect the obligation of the Borrower to repay such
Loan in accordance with the terms of this Agreement.

(c) At the commencement of each Interest Period for any Eurodollar Borrowing,
such Borrowing shall be in an aggregate amount that is an integral multiple of
$100,000 and not less than $500,000. At the time that each ABR Borrowing is
made, such Borrowing shall be in an aggregate amount that is an integral
multiple of $100,000 and not less than $500,000; provided that an ABR Revolving
Borrowing may be in an aggregate amount that is equal to the entire unused
balance of the total Revolving Commitments or that is required to finance the
reimbursement of an LC Disbursement as contemplated by Section 2.06(e). Each
Swingline Loan shall be in an amount that is an integral multiple of $10,000 and
not less than $100,000. Borrowings of more than one Type and Class may be
outstanding at the same time; provided that there shall not at any time be more
than a total of 8 Eurodollar Revolving Borrowings outstanding.

(d) Notwithstanding any other provision of this Agreement, the Borrower shall
not be entitled to request, or to elect to convert or continue, any Borrowing if
the Interest Period requested with respect thereto would end after the Term
Maturity Date or Revolving Maturity Date, as applicable.

 

32

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

SECTION 2.03. Requests for Borrowings. To request a Revolving Borrowing (other
than a Swingline Loan), the Borrower shall notify the Administrative Agent of
such request by telephone (a) in the case of a Eurodollar Borrowing, not later
than 11:00 a.m., New York City time, three Business Days before the date of the
proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 11:00
a.m., New York City time, one Business Day before the date of the proposed
Borrowing; provided that any such notice of an ABR Revolving Borrowing to
finance the reimbursement of an LC Disbursement as contemplated by
Section 2.06(e) may be given not later than 10:00 a.m., New York City time, on
the date of the proposed Borrowing. Each such telephonic Borrowing Request shall
be irrevocable and shall be confirmed promptly by hand delivery, telecopy or
electronic mail to the Administrative Agent of a written Borrowing Request in a
form approved by the Administrative Agent and signed by the Borrower. Each such
telephonic and written Borrowing Request shall specify the following information
in compliance with Section 2.02:

(i) the aggregate amount of the requested Borrowing;

(ii) the date of such Borrowing, which shall be a Business Day;

(iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing;

(iv) in the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period”; and

(v) the location and number of the Borrower’s account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.07.

If no election as to the Type of such Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any such requested Eurodollar Borrowing, then the Borrower shall be
deemed to have selected an Interest Period of one month’s duration. Promptly
following receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender’s Loan to be made as part of the requested Borrowing.

SECTION 2.04. [Intentionally Omitted].

SECTION 2.05. Swingline Loans. (a) Subject to the terms and conditions set forth
herein, the Swingline Lender agrees to make Swingline Loans to the Borrower from
time to time during the Availability Period, in an aggregate principal amount at
any time outstanding that will not result in (i) the aggregate principal amount
of outstanding Swingline Loans exceeding $5,000,000 or (ii) the sum of the total
Revolving Credit Exposures exceeding the total Revolving Commitments; provided
that the Swingline Lender shall not be required to make a Swingline Loan to
refinance an outstanding Swingline Loan. Within the foregoing limits and subject
to the terms and conditions set forth herein, the Borrower may borrow, prepay
and reborrow Swingline Loans.

(b) To request a Swingline Loan, the Borrower shall notify the Administrative
Agent of such request by telephone (confirmed by telecopy or electronic mail),
not later than 12:00 noon, New York City time, on the day of a proposed
Swingline Loan. Each such notice shall be irrevocable and shall specify the
requested date (which shall be a Business Day) and amount of the requested
Swingline Loan. The Administrative Agent will promptly advise the Swingline
Lender of any such notice received from the Borrower. The Swingline Lender shall
make each Swingline Loan available to the Borrower by means of a credit to the
general deposit account of the Borrower with the Swingline Lender (or, in the
case of a Swingline Loan made to finance the reimbursement of an LC Disbursement
as provided in Section 2.06(e), by remittance to the Issuing Bank) by 3:00 p.m.,
New York City time, on the requested date of such Swingline Loan.

 

33

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

(c) The Swingline Lender may by written notice given to the Administrative Agent
not later than 10:00 a.m., New York City time, on any Business Day require the
Lenders to acquire participations on such Business Day in all or a portion of
the Swingline Loans outstanding. Such notice shall specify the aggregate amount
of Swingline Loans in which Lenders will participate. Promptly upon receipt of
such notice, the Administrative Agent will give notice thereof to each Lender,
specifying in such notice such Lender’s Applicable Percentage of such Swingline
Loan or Loans. Each Lender hereby absolutely and unconditionally agrees, upon
receipt of notice as provided above, to pay to the Administrative Agent, for the
account of the Swingline Lender, such Lender’s Applicable Percentage of such
Swingline Loan or Loans. Each Lender acknowledges and agrees that its obligation
to acquire participations in Swingline Loans pursuant to this paragraph is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including the occurrence and continuance of a Default or reduction
or termination of the Commitments, and that each such payment shall be made
without any offset, abatement, withholding or reduction whatsoever. Each Lender
shall comply with its obligation under this paragraph by wire transfer of
immediately available funds, in the same manner as provided in Section 2.07 with
respect to Loans made by such Lender (and Section 2.07 shall apply, mutatis
mutandis, to the payment obligations of the Lenders), and the Administrative
Agent shall promptly pay to the Swingline Lender the amounts so received by it
from the Lenders. The Administrative Agent shall notify the Borrower of any
participations in any Swingline Loan acquired pursuant to this paragraph, and
thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lender. Any amounts received by
the Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Lenders that
shall have made their payments pursuant to this paragraph and to the Swingline
Lender, as their interests may appear; provided that any such payment so
remitted shall be repaid to the Swingline Lender or to the Administrative Agent,
as applicable, if and to the extent such payment is required to be refunded to
the Borrower for any reason. The purchase of participations in a Swingline Loan
pursuant to this paragraph shall not relieve the Borrower of any default in the
payment thereof.

SECTION 2.06. Letters of Credit. (a) General. Subject to the terms and
conditions set forth herein, the Borrower may request the issuance of Letters of
Credit in an aggregate amount not to exceed $5,000,000 as the applicant thereof,
for the support of its or its Subsidiaries’ obligations, in a form reasonably
acceptable to the Administrative Agent and the Issuing Bank, at any time and
from time to time during the Availability Period. In the event of any
inconsistency between the terms and conditions of this Agreement and the terms
and conditions of any form of letter of credit application or other agreement
submitted by the Borrower to, or entered into by the Borrower with, the Issuing
Bank relating to any Letter of Credit, the terms and conditions of this
Agreement shall control.

 

34

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

(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit, the Borrower shall hand deliver or
telecopy (or transmit by electronic communication, if arrangements for doing so
have been approved by the Issuing Bank) to the Issuing Bank and the
Administrative Agent (reasonably in advance of the requested date of issuance,
amendment, renewal or extension, but in any event no less than three Business
Days or such lesser period to which the Issuing Bank may consent) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, and specifying the date of issuance,
amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with paragraph
(c) of this Section), the amount of such Letter of Credit, the name and address
of the beneficiary thereof and such other information as shall be necessary to
prepare, amend, renew or extend such Letter of Credit. If requested by the
Issuing Bank, the Borrower also shall submit a letter of credit application on
the Issuing Bank’s standard form in connection with any request for a Letter of
Credit. Any Letter of Credit with a one-year tenor may provide for the renewal
thereof for additional one-year periods (which shall in no event extend beyond
the date that is five Business Days prior to the Revolving Maturity Date). A
Letter of Credit shall be issued, amended, renewed or extended only if (and upon
issuance, amendment, renewal or extension of each Letter of Credit the Borrower
shall be deemed to represent and warrant that), after giving effect to such
issuance, amendment, renewal or extension (i) the LC Exposure shall not exceed
$5,000,000 and (ii) the sum of the total Revolving Credit Exposures shall not
exceed the total Commitments.

(c) Expiration Date. Each Letter of Credit shall expire (or be subject to
termination by notice from the Issuing Bank to the beneficiary thereof) at or
prior to the close of business on the earlier of (i) the date one year after the
date of the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension) and (ii) the date
that is five Business Days prior to the Revolving Maturity Date.

(d) Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) and without any further action
on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby grants
to each Lender, and each Lender hereby acquires from the Issuing Bank, a
participation in such Letter of Credit equal to such Lender’s Applicable
Percentage of the aggregate amount available to be drawn under such Letter of
Credit. In consideration and in furtherance of the foregoing, each Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent, for
the account of the Issuing Bank, such Lender’s Applicable Percentage of each LC
Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the
date due as provided in paragraph (e) of this Section, or of any reimbursement
payment required to be refunded to the Borrower for any reason. Each Lender
acknowledges and agrees that its obligation to acquire participations pursuant
to this paragraph in respect of Letters of Credit is absolute and unconditional
and shall not be affected by any circumstance whatsoever, including any
amendment, renewal or extension of any Letter of Credit or the occurrence and
continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever.

 

35

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

(e) Reimbursement. If the Issuing Bank shall make any LC Disbursement in respect
of a Letter of Credit, the Borrower shall reimburse such LC Disbursement by
paying to the Administrative Agent an amount equal to such LC Disbursement not
later than 12:00 noon, New York City time, on the date that such LC Disbursement
is made, if the Borrower shall have received notice of such LC Disbursement
prior to 10:00 a.m., New York City time, on such date, or, if such notice has
not been received by the Borrower prior to such time on such date, then not
later than 12:00 noon, New York City time, on (i) the Business Day that the
Borrower receives such notice, if such notice is received prior to 10:00 a.m.
New York City time, on the day of receipt, or (ii) the Business Day immediately
following the day that the Borrower receives such notice; if such notice is not
received prior to such time of the day of receipt; provided that the Borrower
may, subject to the conditions to borrowing set forth herein (including
Section 2.02(c)), request in accordance with Section 2.03 or 2.05 that such
payment be financed with an ABR Revolving Borrowing or Swingline Loan in an
equivalent amount and, to the extent so financed, the Borrower’s obligation to
make such payment shall be discharged and replaced by the resulting ABR
Revolving Borrowing or Swingline Loan. If the Borrower fails to make such
payment when due, the Administrative Agent shall notify each Lender of the
applicable LC Disbursement, the payment then due from the Borrower in respect
thereof and such Lender’s Applicable Percentage thereof. Promptly following
receipt of such notice, each Lender shall pay to the Administrative Agent its
Applicable Percentage of the payment then due from the Borrower, in the same
manner as provided in Section 2.07 with respect to Loans made by such Lender
(and Section 2.07 shall apply, mutatis mutandis, to the payment obligations of
the Lenders), and the Administrative Agent shall promptly pay to the Issuing
Bank the amounts so received by it from the Lenders. Promptly following receipt
by the Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to the Issuing
Bank or, to the extent that Lenders have made payments pursuant to this
paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing
Bank as their interests may appear. Any payment made by a Lender pursuant to
this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than
the funding of ABR Revolving Loans or a Swingline Loan as contemplated above)
shall not constitute a Loan and shall not relieve the Borrower of its obligation
to reimburse such LC Disbursement.

(f) Obligations Absolute. The Borrower’s obligation to reimburse LC
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein, (ii) any draft or
other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower’s obligations hereunder. Neither
the Administrative Agent, the Lenders nor the Issuing Bank, nor any of their
Related Parties, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or

 

36

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

delivery of any draft, notice or other communication under or relating to any
Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation of technical terms or any consequence arising from
causes beyond the control of the Issuing Bank; provided that the foregoing shall
not be construed to excuse the Issuing Bank from liability to the Borrower to
the extent of any direct damages (as opposed to special, indirect, consequential
or punitive damages, claims in respect of which are hereby waived by the
Borrower to the extent permitted by applicable law) suffered by the Borrower
that are caused by the Issuing Bank’s failure to exercise care when determining
whether drafts and other documents presented under a Letter of Credit comply
with the terms thereof. The parties hereto expressly agree that, in the absence
of gross negligence or willful misconduct on the part of the Issuing Bank (as
finally determined by a court of competent jurisdiction), the Issuing Bank shall
be deemed to have exercised care in each such determination. In furtherance of
the foregoing and without limiting the generality thereof, the parties agree
that, with respect to documents presented which appear on their face to be in
substantial compliance with the terms of a Letter of Credit, the Issuing Bank
may, in its sole discretion, either accept and make payment upon such documents
without responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.

(g) Disbursement Procedures. The Issuing Bank shall, promptly following its
receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Bank shall promptly notify the
Administrative Agent and the Borrower by telephone (confirmed by telecopy or
electronic mail) of such demand for payment and whether the Issuing Bank has
made or will make an LC Disbursement thereunder; provided that any failure to
give or delay in giving such notice shall not relieve the Borrower of its
obligation to reimburse the Issuing Bank and the Lenders with respect to any
such LC Disbursement.

(h) Interim Interest. If the Issuing Bank shall make any LC Disbursement, then,
unless the Borrower shall reimburse such LC Disbursement in full on the date
such LC Disbursement is made, the unpaid amount thereof shall bear interest, for
each day from and including the date such LC Disbursement is made to but
excluding the date that the Borrower reimburses such LC Disbursement, at the
rate per annum then applicable to ABR Revolving Loans; provided that, if the
Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph
(e) of this Section, then Section 2.13(d) shall apply. Interest accrued pursuant
to this paragraph shall be for the account of the Issuing Bank, except that
interest accrued on and after the date of payment by any Lender pursuant to
paragraph (e) of this Section to reimburse the Issuing Bank shall be for the
account of such Lender to the extent of such payment.

 

37

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

(i) Replacement of the Issuing Bank. The Issuing Bank may be replaced at any
time by written agreement among the Borrower, the Administrative Agent, the
replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent
shall notify the Lenders of any such replacement of the Issuing Bank. At the
time any such replacement shall become effective, the Borrower shall pay all
unpaid fees accrued for the account of the replaced Issuing Bank pursuant to
Section 2.12(b). From and after the effective date of any such replacement,
(i) the successor Issuing Bank shall have all the rights and obligations of the
Issuing Bank under this Agreement with respect to Letters of Credit to be issued
thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed
to refer to such successor or to any previous Issuing Bank, or to such successor
and all previous Issuing Banks, as the context shall require. After the
replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain
a party hereto and shall continue to have all the rights and obligations of an
Issuing Bank under this Agreement with respect to Letters of Credit issued by it
prior to such replacement, but shall not be required to issue additional Letters
of Credit.

(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Lenders with LC Exposure representing greater than 50% of
the total LC Exposure) demanding the deposit of cash collateral pursuant to this
paragraph, the Borrower shall deposit in an account with the Administrative
Agent, in the name of the Administrative Agent and for the benefit of the
Lenders, an amount in cash equal to 105% of the LC Exposure as of such date plus
any accrued and unpaid interest thereon; provided that the obligation to deposit
such cash collateral shall become effective immediately, and such deposit shall
become immediately due and payable, without demand or other notice of any kind,
upon the occurrence of any Event of Default with respect to the Borrower
described in clause (h) or (i) of Article VII. Such deposit shall be held by the
Administrative Agent as collateral for the payment and performance of the
obligations of the Borrower under this Agreement. The Administrative Agent shall
have exclusive dominion and control, including the exclusive right of
withdrawal, over such account. Other than any interest earned on the investment
of such deposits, which investments shall be made at the option and sole
discretion of the Administrative Agent and at the Borrower’s risk and expense,
such deposits shall not bear interest. Interest or profits, if any, on such
investments shall accumulate in such account. Moneys in such account shall be
applied by the Administrative Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrower for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated (but subject to the consent of Lenders with LC Exposure
representing greater than 50% of the total LC Exposure), be applied to satisfy
other obligations of the Borrower under this Agreement. If the Borrower is
required to provide an amount of cash collateral hereunder as a result of the
occurrence of an Event of Default, such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower within three Business Days after
all Events of Default have been cured or waived.

SECTION 2.07. Funding of Borrowings. (a) Each Lender shall make each Loan to be
made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, New York City time, to the account of
the Administrative Agent most recently designated by it for such purpose by
notice to the Lenders; provided that Swingline Loans shall be made as provided
in Section 2.05. The Administrative Agent will make such Loans available to the
Borrower by promptly crediting the amounts so received, in like funds, to an
account of the Borrower maintained with the Administrative Agent in New York
City and designated by the Borrower in the applicable Borrowing Request;
provided that ABR Revolving Loans made to finance the reimbursement of an LC
Disbursement as provided in Section 2.06(e) shall be remitted by the
Administrative Agent to the Issuing Bank.

 

38

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

(b) Unless the Administrative Agent shall have received notice from a Lender
prior to the proposed date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender’s share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
on such date in accordance with paragraph (a) of this Section and may, in
reliance upon such assumption, make available to the Borrower a corresponding
amount. In such event, if a Lender has not in fact made its share of the
applicable Borrowing available to the Administrative Agent, then the applicable
Lender and the Borrower severally agree to pay to the Administrative Agent
forthwith on demand such corresponding amount with interest thereon, for each
day from and including the date such amount is made available to the Borrower to
but excluding the date of payment to the Administrative Agent, at (i) in the
case of such Lender, the greater of the Federal Funds Effective Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation or (ii) in the case of the Borrower, the interest rate
applicable to ABR Loans. If such Lender pays such amount to the Administrative
Agent, then such amount shall constitute such Lender’s Loan included in such
Borrowing.

SECTION 2.08. Interest Elections. (a) Each Borrowing initially shall be of the
Type specified in the applicable Borrowing Request and, in the case of a
Eurodollar Revolving Borrowing, shall have an initial Interest Period as
specified in such Borrowing Request. Thereafter, the Borrower may elect to
convert such Borrowing to a different Type or to continue such Borrowing and, in
the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as
provided in this Section. The Borrower may elect different options with respect
to different portions of the affected Borrowing, in which case each such portion
shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing. This Section shall not apply to Swingline Borrowings, which
may not be converted or continued.

(b) To make an election pursuant to this Section, the Borrower shall notify the
Administrative Agent of such election by telephone by the time that a Borrowing
Request would be required under Section 2.03 if the Borrower were requesting a
Borrowing of the Type resulting from such election to be made on the effective
date of such election. Each such telephonic Interest Election Request shall be
irrevocable and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Interest Election Request in a form approved
by the Administrative Agent and signed by the Borrower.

(c) Each telephonic and written Interest Election Request shall specify the
following information in compliance with Section 2.02:

(i) the Borrowing to which such Interest Election Request applies and, if
different options are being elected with respect to different portions thereof,
the portions thereof to be allocated to each resulting Borrowing (in which case
the information to be specified pursuant to clauses (iii) and (iv) below shall
be specified for each resulting Borrowing);

(ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;

 

39

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

(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and

(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period
to be applicable thereto after giving effect to such election, which shall be a
period contemplated by the definition of the term “Interest Period”.

If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month’s duration.

(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender’s portion of each resulting Borrowing.

(e) If the Borrower fails to deliver a timely Interest Election Request with
respect to a Eurodollar Revolving Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing. Notwithstanding any contrary provision hereof, if a Default
has occurred and is continuing and the Administrative Agent, at the request of
the Required Lenders, so notifies the Borrower, then, so long as a Default is
continuing (i) no outstanding Revolving Borrowing may be converted to or
continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar
Revolving Borrowing shall be converted to an ABR Borrowing at the end of the
Interest Period applicable thereto.

SECTION 2.09. Termination, Reduction and Increase of Commitments. (a) Unless
previously terminated, the Revolving Commitments shall terminate on the
Revolving Maturity Date. Unless previously terminated, the Term Commitments
shall terminate upon the making of the Term Loan on the date of the initial
Borrowing.

(b) The Borrower may at any time terminate, or from time to time reduce, the
Commitments; provided that (i) each reduction of the Commitments shall be in an
amount that is an integral multiple of $5,000,000 and not less than $5,000,000
and (ii) the Borrower shall not terminate or reduce the Revolving Commitments
if, after giving effect to any concurrent prepayment of the Revolving Loans in
accordance with Section 2.11, the sum of the Revolving Credit Exposures would
exceed the total Revolving Commitments. Notwithstanding anything to the contrary
contained herein, if the Revolving Commitments are terminated, then the Term
Commitments shall simultaneously be terminated and all outstanding Term Loans
(including interest) shall be immediately due and payable.

(c) The Borrower shall notify the Administrative Agent of any election to
terminate or reduce the Commitments under paragraph (b) of this Section at least
five Business Days prior to the effective date of such termination or reduction,
specifying such election and the effective date thereof. Promptly following
receipt of any notice, the Administrative Agent shall advise the Lenders of the
contents thereof. Each notice delivered by the Borrower pursuant to this Section
shall be irrevocable; provided that a notice of termination of the Commitments
delivered by the Borrower may state that such notice is conditioned upon the
effectiveness of a particular event specified in such notice or other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied. Any termination or reduction of the Commitments
shall be permanent. Each reduction of the Commitments shall be made ratably
among the Lenders in accordance with their respective Revolving Commitments or
Term Commitments, as applicable.

 

40

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

(d) From time to time after the Effective Date, the Borrower may, at its option,
and subject to terms and pursuant to documentation applicable to the existing
Revolving Commitments (including, without limitation, subject to the same
pricing as the existing Revolving Commitments unless the pricing on the existing
Revolving Commitments is increased to match the higher pricing applicable to the
increased amount of the Revolving Commitments), seek to increase the total
Revolving Commitments by an aggregate amount of up to $10,000,000 (resulting in
maximum total Revolving Commitments of $30,000,000) upon at least ten
(10) Business Days’ prior written notice to the Administrative Agent, which
notice shall specify the amount of any such increase (which shall not be less
than $5,000,000 or such lesser amount to which the Administrative Agent may
agree) and shall certify that no Default has occurred and is continuing. After
delivery of such notice, the Administrative Agent or the Borrower, in
consultation with the Administrative Agent, shall offer the increase (which may
be declined by any Lender in its sole discretion) in the total Revolving
Commitments on a ratable basis to the Lenders and/or to other Lenders or
entities reasonably acceptable to the Administrative Agent. No increase in the
total Revolving Commitments shall become effective until the existing or new
Lenders extending such incremental Commitment amount and the Borrower shall have
delivered to the Administrative Agent a document in form and substance
reasonably satisfactory to the Administrative Agent pursuant to which (i) any
such existing Lender agrees to the amount of its Revolving Commitment increase,
(ii) any such new Lender agrees to its Revolving Commitment amount and agrees to
assume and accept the obligations and rights of a Lender hereunder, (iii) the
Borrower accepts such incremental Revolving Commitments, (iv) the effective date
of any increase in the Revolving Commitments is specified and (v) the Borrower
certifies that on such date the conditions for a new Loan set forth in
Section 4.02 are satisfied. Upon the effectiveness of any increase in the total
Revolving Commitments pursuant hereto, (i) each Lender (new or existing) shall
be deemed to have accepted an assignment from the existing Lenders, and the
existing Lenders shall be deemed to have made an assignment to each new or
existing Lender accepting a new or increased Revolving Commitment, of an
interest in each then outstanding Revolving Loan (in each case, on the terms and
conditions set forth in the Assignment and Assumption) and (ii) the Swingline
Exposure and LC Exposure of the existing and new Lenders shall be automatically
adjusted such that, after giving effect to such assignments and adjustments, all
Revolving Credit Exposure hereunder is held ratably by the Lenders in proportion
to their respective Revolving Commitments. Assignments pursuant to the preceding
sentence shall be made in exchange for, and substantially contemporaneously with
the payment to the assigning Lenders of, the principal amount assigned plus
accrued and unpaid interest and commitment and Letter of Credit fees. Payments
received by assigning Lenders pursuant to this Section in respect of the
principal amount of any Eurodollar Loan shall, for purposes of Section 2.16 be
deemed prepayments of such Loan. Any increase of the total Revolving Commitments
pursuant to this Section shall be subject to receipt by the Administrative Agent
from the Borrower of such supplemental opinions, resolutions, certificates and
other documents as the Administrative Agent may reasonably request. No consent
of any Lender (other than the Lenders agreeing to new or increased Revolving
Commitments) shall be required for any incremental Revolving Commitment provided
or Loan made pursuant to this Section 2.09(d).

 

41

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

SECTION 2.10. Repayment of Loans; Evidence of Debt. (a) The Borrower hereby
unconditionally promises to pay (i) to the Administrative Agent for the account
of each applicable Lender the then unpaid principal amount of each Revolving
Loan on the Revolving Maturity Date, (ii) to the Swingline Lender the then
unpaid principal amount of each Swingline Loan on the earlier of the Revolving
Maturity Date and the first date after such Swingline Loan is made that is the
15th or last day of a calendar month and is at least two Business Days after
such Swingline Loan is made; provided that on each date that a Revolving
Borrowing is made, the Borrower shall repay all Swingline Loans then outstanding
and (iii) to the Administrative Agent for the account of each applicable Lender,
on the first Business Day of each calendar quarter (each such date being called
a “Repayment Date”), commencing on April 1, 2013, a principal amount of the Term
Loans in an amount equal to 2.50% of the original principal amount of the Term
Loans with the remaining balance thereof payable on the Term Maturity Date.

(b) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the indebtedness of the Borrower to such Lender resulting
from each Loan made by such Lender, including the amounts of principal and
interest payable and paid to such Lender from time to time hereunder.

(c) The Administrative Agent shall maintain accounts in which it shall record
(i) the amount of each Loan made hereunder, the Class and Type thereof and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder and (iii) the amount of any sum received by the Administrative Agent
hereunder for the account of the Lenders and each Lender’s share thereof.

(d) The entries made in the accounts maintained pursuant to paragraph (b) or
(c) of this Section shall be prima facie evidence of the existence and amounts
of the obligations recorded therein; provided that the failure of any Lender or
the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligation of the Borrower to repay the Loans in
accordance with the terms of this Agreement.

(e) Any Lender may request that Loans made by it be evidenced by a promissory
note. In such event, the Borrower shall prepare, execute and deliver to such
Lender a promissory note payable to such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) and in a form approved by the
Administrative Agent. Thereafter, the Loans evidenced by such promissory note
and interest thereon shall at all times (including after assignment pursuant to
Section 9.04) be represented by one or more promissory notes in such form
payable to the payee named therein (or, if such promissory note is a registered
note, to such payee and its registered assigns).

 

42

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

(f) If at any time the aggregate Revolving Credit Exposure of the Lenders
exceeds the aggregate Revolving Commitments of the Lenders, the Borrower shall
immediately prepay the Revolving Loans in the amount of such excess. To the
extent that, after the prepayment of all Revolving Loans an excess of the
Revolving Credit Exposure over the aggregate Commitments still exists, the
Borrower shall promptly cash collateralize the Letters of Credit in the manner
described in Section 2.06(j) in an amount sufficient to eliminate such excess.

SECTION 2.11. Prepayment of Loans. (a) The Borrower shall have the right at any
time and from time to time to prepay any Borrowing in whole or in part, without
penalty or premium (but subject to Section 2.16), subject to prior notice in
accordance with paragraph (b) of this Section. Optional prepayments of the Term
Loans shall be applied to the principal installments thereon due pursuant to
Section 2.10 in inverse order of maturity (amounts repaid or prepaid on the
Terms Loans may not be reborrowed).

(b) The Borrower shall notify the Administrative Agent (and, in the case of
prepayment of a Swingline Loan, the Swingline Lender) by telephone (confirmed by
telecopy or electronic mail) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of prepayment, (ii) in the case of
prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time,
one Business Day before the date of prepayment or (iii) in the case of
prepayment of a Swingline Loan, not later than 12:00 noon, New York City time,
on the date of prepayment. Each such notice shall be irrevocable and shall
specify the prepayment date and the principal amount of each Borrowing or
portion thereof to be prepaid; provided that such notice delivered by the
Borrower may state that such notice is conditioned upon the effectiveness of a
particular event specified in such notice or other credit facilities, in which
case such notice may be revoked by the Borrower (by notice to the Administrative
Agent on or prior to the specified effective date) if such condition is not
satisfied. Promptly following receipt of any such notice relating to a
Borrowing, the Administrative Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Borrowing shall be in an amount that
would be permitted in the case of an advance of a Borrowing of the same Type as
provided in Section 2.02. Each prepayment of a Borrowing shall be applied
ratably to the Loans included in the prepaid Borrowing. Prepayments shall be
accompanied by accrued interest to the extent required by Section 2.13.
Notwithstanding anything to the contrary contained herein, no proceeds of
Revolver Loans, directly or indirectly, may be used to make any prepayment
pursuant to Section 2.11(a).

(c) The Credit Parties and their Subsidiaries shall make mandatory prepayment of
the Loans in amounts equal to the following:

(i) concurrently with the receipt thereof by the Parent, the Borrower or any
Subsidiary, 100% of the aggregate Net Available Proceeds realized upon all Asset
Dispositions (other than Asset Dispositions solely between Credit Parties) and
Asset Swaps in any Fiscal Year of the Borrower (including, without limitation,
the sale of assets owned by any Foreign Subsidiary; provided that the Borrower
shall be permitted to net an amount not to exceed $3,000,000 in the aggregate
from the Effective Date against the Net Available Proceeds realized from the
sale of such assets by a Foreign Subsidiary for the purpose of funding costs
associated with the Hungarian Litigation, so long as all such amounts do not
exceed an amount equal to (x) $3,000,000

 

43

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

less (y) any of such amounts as have been added to the calculation of
Consolidated EBITDA pursuant to clause (f) of the definition thereof on or after
the Effective Date and are held overseas in a separate segregated account in a
manner reasonably satisfactory to the Administrative Agent); provided that
notwithstanding the foregoing and provided that no Default or Event of Default
has occurred and is continuing, such prepayment shall not be required to the
extent the Parent, Borrower or such Subsidiary, as applicable, reinvests the Net
Available Proceeds of such Asset Disposition or Asset Swap in productive assets
(other than inventory) of a kind then used or usable in the business of the
Parent, Borrower or such Subsidiary, as applicable, within 180 days after
receipt of such Net Available Proceeds, or enters into a binding commitment
thereof within said 180-day period and subsequently makes such reinvestment
within 365 days after receipt of such Net Available Proceeds; provided that the
Borrower notifies the Administrative Agent of the Parent’s, Borrower’s or such
Subsidiary’s intent, as applicable, to reinvest and of the completion of such
reinvestment at the time such proceeds are received and when such reinvestment
occurs, respectively;

(ii) concurrently with the receipt thereof by the Parent, the Borrower or any
Subsidiary, (A) 50% of the Net Available Proceeds realized upon the issuance by
any such Person of any Equity Interests, or the receipt by the Parent, the
Borrower or any Subsidiary of any capital contribution securities and (B) 100%
of the Net Available Proceeds realized upon the incurrence by Parent, the
Borrower or any Subsidiary of any Indebtedness other than Indebtedness permitted
under Section 6.01 (excluding clause (h) therein, except as set forth below in
this clause (ii)), and, in each case of clauses (A) and (B), other than Net
Available Proceeds utilized in connection with the refinancing and/or redemption
of the Parent Preferred Stock;

(iii) concurrently with the receipt thereof by the Parent, the Borrower or any
Subsidiary, 100% of the aggregate Net Available Proceeds realized in connection
with any casualty or other insured damage to, or any taking under power of
eminent domain or by condemnation or similar proceeding of, any property or
asset of any such Person; provided that if the Borrower shall deliver to the
Administrative Agent a certificate of a Financial Officer to the effect that the
Parent, the Borrower or its Subsidiaries, as applicable, intend to apply the Net
Available Proceeds from such event (or a portion thereof specified in such
certificate), within 180 days after receipt of such Net Available Proceeds, to
repair or replace any such property or assets to be used in the business of the
Credit Parties, and certifying that no Default has occurred and is continuing,
then no prepayment shall be required pursuant to this paragraph in respect of
the Net Available Proceeds specified in such certificate; provided, however that
to the extent of any such Net Available Proceeds therefrom that have not been so
applied by the end of such 180 day period, at which time a prepayment shall be
required in an amount equal to such Net Available Proceeds that have not been so
applied; and

 

44

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

(iv) commencing with the Fiscal Year ending February 28, 2014, on the date that
is ten days after the earlier of (a) the date on which the Parent’s and
Borrower’s annual audited financial statements for the immediately preceding
Fiscal Year are delivered pursuant to Section 5.01 and (b) the date on which
such annual audited financial statements were required to be delivered pursuant
to Section 5.01, an amount equal to (x) 50% of Consolidated Excess Cash Flow for
the immediately preceding Fiscal Year minus (y) prepayments of Revolving Loans
and Swingline Loans during such Fiscal Year solely to the extent accompanying
permanent optional reductions of the Revolving Commitments and all optional
prepayments of the Term Loans during such Fiscal Year; provided, however that
the foregoing percentage shall be reduced to 0% for any such Fiscal Year to the
extent that the Senior Leverage Ratio was less than or equal to 3.0 to 1.0 as of
the last day of such Fiscal Year. Each Consolidated Excess Cash Flow prepayment
shall be accompanied by a certificate signed by a Financial Officer certifying
the manner in which Consolidated Excess Cash Flow and the resulting prepayment
were calculated, which certificate shall be in form and substance satisfactory
to Administrative Agent.

(d) Mandatory prepayments of the Loans pursuant to clause (c) above shall be
accompanied by the payment of accrued interest on the principal amount repaid
and the payment of any amounts due and payable pursuant to Section 2.16 in
connection with such prepayment and shall be applied first to prepay any
protective advances or overadvances that may be outstanding, to the extent
permitted under the Credit Documents, second to the principal installments
thereon due pursuant to Section 2.10 in inverse order of maturity in the
following order: first to prepay the Term Loans and then to prepay the Revolving
Loans (including the Swingline Loans) with a corresponding reduction in the
Revolving Commitments and to cash collateralize outstanding LC Exposure.

SECTION 2.12. Fees.

(a) The Borrower agrees to pay to the Administrative Agent for the account of
each Lender a commitment fee, which shall accrue at the Applicable Rate on the
average daily amount of the difference between the Revolving Commitment of such
Lender and the Revolving Credit Exposure excluding Swingline Exposure of such
Lender during the period from and including the date hereof to but excluding the
date on which such Commitments terminate. Accrued commitment fees shall be
payable in arrears on the third Business Day following the last day of March,
June, September and December of each year and on the date on which the
applicable Commitments terminate, commencing on the first such date to occur
after the date hereof. All commitment fees shall be computed on the basis of a
year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).

(b) The Borrower agrees to pay (i) to the Administrative Agent for the account
of each Lender a participation fee with respect to its participations in Letters
of Credit, which shall accrue at the same Applicable Rate used to determine the
interest rate applicable to Eurodollar Revolving Loans on the average daily
amount of such Lender’s LC Exposure (excluding any portion thereof attributable
to unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date on which such Lender’s
Commitment terminates and the date on which such Lender ceases to have any LC
Exposure, and (ii) to the Issuing Bank a fronting fee, which shall accrue at the
rate or rates per annum separately agreed upon between the Borrower and the
Issuing Bank on the average daily amount of the LC Exposure (excluding any
portion thereof attributable to unreimbursed LC Disbursements) during the period
from and including the Effective Date to but excluding the later of the date of
termination of the Revolving Commitments and the date on which there

 

45

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

ceases to be any LC Exposure, as well as the Issuing Bank’s standard fees with
respect to the issuance, amendment, renewal or extension of any Letter of Credit
or processing of drawings thereunder. Participation fees and fronting fees
accrued through and including the last day of March, June, September and
December of each year shall be payable on the third Business Day following such
last day, commencing on the first such date to occur after the Effective Date;
provided that all such fees shall be payable on the date on which the Revolving
Commitments terminate and any such fees accruing after the date on which the
Revolving Commitments terminate shall be payable on demand. Any other fees
payable to the Issuing Bank pursuant to this paragraph shall be payable within
10 days after demand. All participation fees and fronting fees shall be computed
on the basis of a year of 360 days and shall be payable for the actual number of
days elapsed (including the first day but excluding the last day).

(c) The Borrower agrees to pay to the Administrative Agent, for its own account,
fees payable in the amounts and at the times separately agreed upon between the
Borrower and the Administrative Agent, including without limitation, pursuant to
the Fee Letters.

(d) All fees payable hereunder shall be paid on the dates due, in immediately
available funds, to the Administrative Agent (or to the Issuing Bank, in the
case of fees payable to it) for distribution, in the case of commitment fees and
participation fees, to the Lenders. Fees paid shall not be refundable under any
circumstances.

SECTION 2.13. Interest. (a) The Loans comprising each ABR Borrowing (including
each Swingline Loan) shall bear interest at the Alternate Base Rate plus the
Applicable Rate.

(b) The Loans comprising each Eurodollar Borrowing shall bear interest at the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Rate.

(c) Notwithstanding the foregoing, during the occurrence and continuance of a
Default, the Administrative Agent or the Required Lenders may, at their option,
by notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 9.02 requiring the
consent of “each Lender affected thereby” for reductions in interest rates),
declare that (i) all Loans shall bear interest at 2% plus the rate otherwise
applicable to such Loans as provided in the preceding paragraphs of this Section
or (ii) in the case of any other amount outstanding hereunder, such amount shall
accrue at 2% plus the rate applicable to such fee or other obligation as
provided hereunder.

(d) Accrued interest on each Loan shall be payable in arrears on each Interest
Payment Date for such Loan, upon the final maturity thereof and, in the case of
Revolving Loans, upon termination of the Revolving Commitments; provided that
(i) interest accrued pursuant to paragraph (c) of this Section shall be payable
on demand, (ii) in the event of any repayment or prepayment of any Loan (other
than a prepayment of an ABR Loan prior to the end of the Availability Period),
accrued interest on the principal amount repaid or prepaid shall be payable on
the date of such repayment or prepayment and (iii) in the event of any
conversion of any Eurodollar Loan prior to the end of the current Interest
Period therefor, accrued interest on such Loan shall be payable on the effective
date of such conversion.

 

46

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

(e) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the Alternate Base Rate at times
when the Alternate Base Rate is based on the Prime Rate shall be computed on the
basis of a year of 365 days (or 366 days in a leap year), and in each case shall
be payable for the actual number of days elapsed (including the first day but
excluding the last day). The applicable Alternate Base Rate, Adjusted LIBO Rate
or LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.

SECTION 2.14. Alternate Rate of Interest. (a) If prior to the commencement of
any Interest Period for a Eurodollar Borrowing:

(i) the Administrative Agent determines (which determination shall be conclusive
absent manifest error) that adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period; or

(ii) the Administrative Agent is advised by the Required Lenders that the
Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period
will not adequately and fairly reflect the cost to such Lenders (or Lender) of
making or maintaining their Loans (or its Loan) included in such Borrowing for
such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Revolving Borrowing to, or
continuation of any Revolving Borrowing as, a Eurodollar Borrowing shall be
ineffective and such Borrowing shall be continued as an ABR Borrowing and
(ii) if any Borrowing Request requests a Eurodollar Revolving Borrowing, such
Borrowing shall be made as an ABR Borrowing; provided that if the circumstances
giving rise to such notice affect only one Type of Borrowings, then the other
Type of Borrowings shall be permitted.

(b) If, after the date hereof, any Change in law shall make it unlawful or
impossible for any of the Lenders (or any of their respective Lending Offices)
to honor its obligations hereunder to make or maintain any Eurodollar Loan or
any ABR Loan as to which the interest rate is determined by reference to the
Adjusted LIBO Rate, such Lender shall promptly give notice thereof to the
Administrative Agent and the Administrative Agent shall promptly give notice to
the Borrower and the other Lenders. Thereafter, until the Administrative Agent
notifies the Borrower that such circumstances no longer exist, (i) the
obligations of the Lenders to make Eurodollar Loans or ABR Loans as to which the
interest rate is determined by reference to the Adjusted LIBO Rate, and the
right of the Borrower to convert any Loan to a Eurodollar Loan or continue any
Loan as a Eurodollar Loan or an ABR Loan as to which the interest rate is
determined by reference to the Adjusted LIBO Rate shall be suspended and
thereafter the Borrower may select only ABR Loans as to which the interest rate
is not determined by reference to the Adjusted LIBO Rate hereunder, (ii) all ABR
Loans shall cease to be determined by reference to the Adjusted LIBO Rate and
(iii) if any of the Lenders may not lawfully continue to maintain a Eurodollar
Loan to the end of the then current Interest Period applicable thereto, the
applicable Loan shall immediately be converted to an ABR Loan as to which the
interest rate is not determined by reference to the Adjusted LIBO Rate for the
remainder of such Interest Period.

 

47

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

SECTION 2.15. Increased Costs. (a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, compulsory
loan, insurance charge or similar requirement against assets of, deposits with
or for the account of, or credit extended by, any Lender (except any such
reserve requirement reflected in the Adjusted LIBO Rate) or the Issuing Bank;

(ii) impose on any Lender or the Issuing Bank or the London interbank market any
other condition, cost or expense (other than Taxes) affecting this Agreement or
Eurodollar Loans made by such Lender or any Letter of Credit or participation
therein; or

(iii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes,
(B) Taxes described in clauses (b) through (d) of the definition of Excluded
Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of
credit, commitments, or other obligations, or its deposits, reserves, other
liabilities or capital attributable thereto;

and the result of any of the foregoing shall be to increase the cost to such
Lender or such other Recipient of making, converting into, continuing or
maintaining any Eurodollar Loan (or of maintaining its obligation to make any
such Loan) or to increase the cost to such Lender, the Issuing Bank or such
other Recipient of participating in, issuing or maintaining any Letter of Credit
or to reduce the amount of any sum received or receivable by such Lender, the
Issuing Bank or such other Recipient hereunder (whether of principal, interest
or otherwise), then the Borrower will pay to such Lender, the Issuing Bank or
such other Recipient, as the case may be, such additional amount or amounts as
will compensate such Lender, the Issuing Bank or such other Recipient, as the
case may be, for such additional costs incurred or reduction suffered.

(b) If any Lender or the Issuing Bank determines that any Change in Law
regarding capital or liquidity requirements has or would have the effect of
reducing the rate of return on such Lender’s or the Issuing Bank’s capital or on
the capital of such Lender’s or the Issuing Bank’s holding company, if any, as a
consequence of this Agreement or the Loans made by, or participations in Letters
of Credit held by, such Lender, or the Letters of Credit issued by the Issuing
Bank, to a level below that which such Lender or the Issuing Bank or such
Lender’s or the Issuing Bank’s holding company could have achieved but for such
Change in Law (taking into consideration such Lender’s or the Issuing Bank’s
policies and the policies of such Lender’s or the Issuing Bank’s holding company
with respect to capital adequacy and liquidity), then from time to time the
Borrower will pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing Bank
or such Lender’s or the Issuing Bank’s holding company for any such reduction
suffered.

 

48

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

(c) A certificate of a Lender or the Issuing Bank setting forth the amount or
amounts necessary to compensate such Lender or the Issuing Bank or its holding
company, as the case may be, as specified in paragraph (a) or (b) of this
Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender or the Issuing Bank, as the
case may be, the amount shown as due on any such certificate within 10 days
after receipt thereof.

(d) Failure or delay on the part of any Lender or the Issuing Bank to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender’s or the Issuing Bank’s right to demand such compensation; provided that
the Borrower shall not be required to compensate a Lender or the Issuing Bank
pursuant to this Section for any increased costs or reductions incurred more
than 270 days prior to the date that such Lender or the Issuing Bank, as the
case may be, notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender’s or the Issuing Bank’s
intention to claim compensation therefor; provided further that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the 270-day period referred to above shall be extended to include the period of
retroactive effect thereof.

SECTION 2.16. Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default),
(b) the conversion of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under
Section 2.11(b) and is revoked in accordance therewith) or (d) the assignment of
any Eurodollar Loan other than on the last day of the Interest Period applicable
thereto as a result of a request by the Borrower pursuant to Section 2.19, then,
in any such event, the Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. In the case of a Eurodollar Loan, such
loss, cost or expense to any Lender shall be deemed to include an amount
determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the Adjusted LIBO Rate that would have been applicable to
such Loan, for the period from the date of such event to the last day of the
then current Interest Period therefor (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the Interest Period for
such Loan), over (ii) the amount of interest which would accrue on such
principal amount for such period at the interest rate which such Lender would
bid were it to bid, at the commencement of such period, for Dollar deposits of a
comparable amount and period from other banks in the eurodollar market. A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender the amount shown as due on any such certificate within 10 days after
receipt thereof.

 

49

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

SECTION 2.17. Taxes. (a) Payments Free of Taxes. Any and all payments by or on
account of any obligation of any Credit Party under any Credit Document shall be
made without deduction or withholding for any Taxes, except as required by
applicable law. If any applicable law (as determined in the good faith
discretion of an applicable Withholding Agent) requires the deduction or
withholding of any Tax from any such payment by a Withholding Agent, then the
applicable Withholding Agent shall be entitled to make such deduction or
withholding and shall timely pay the full amount deducted or withheld to the
relevant Governmental Authority in accordance with applicable law and if such
Tax is an Indemnified Tax, then the sum payable by the applicable Credit Party
shall be increased as necessary so that, after such deduction or withholding has
been made (including such deductions and withholdings applicable to additional
sums payable under this Section 2.17), the applicable Recipient receives an
amount equal to the sum it would have received had no such deduction or
withholding been made.

(b) Payment of Other Taxes by the Borrower. The Credit Parties shall timely pay
to the relevant Governmental Authority in accordance with applicable law, or at
the option of the Administrative Agent timely reimburse it for, Other Taxes.

(c) Evidence of Payments. As soon as practicable after any payment of Taxes by
any Credit Party to a Governmental Authority pursuant to this Section 2.17 such
Credit Party shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.

(d) Indemnification by the Borrower. The Credit Parties shall jointly and
severally indemnify each Recipient within 10 days after demand therefor, for the
full amount of any Indemnified Taxes (including Indemnified Taxes imposed or
asserted on or attributable to amounts payable under this Section payable or
paid by such Recipient or required to be withheld or deducted from a payment to
such Recipient and any reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes were correctly or legally imposed
or asserted by the relevant Governmental Authority. A certificate as to the
amount of such payment delivered to the Borrower by a Lender (with a copy to the
Administrative Agent), or by the Administrative Agent on its own behalf or on
behalf of a Lender, shall be conclusive absent manifest error.

(e) Indemnification by the Lenders. Each Lender shall severally indemnify the
Administrative Agent, within 10 days after demand therefor, for (i) any
Indemnified Taxes attributable to such Lender (but only to the extent that any
Credit Party has not already indemnified the Administrative Agent for such
Indemnified Taxes and without limiting the obligation of the Credit Parties to
do so) (ii) any Taxes attributable to such Lender’s failure to comply with the
provisions of Section 9.04(c) relating to the maintenance of a Participant
Register and (iii) any Excluded Taxes attributable to such Lender, in each case,
that are payable or paid by the Administrative Agent in connection with any
Credit Document and any reasonable expenses arising therefrom or with respect
thereto, whether or not such Taxes were correctly or legally imposed or asserted
by the relevant Governmental Authority. A certificate as to the amount of such
payment or liability delivered to any Lender by the Administrative Agent shall
be conclusive absent manifest error. Each Lender hereby authorizes the
Administrative Agent to set off and apply any and all amounts at any time owing
to such Lender under any Credit Document or otherwise payable by the
Administrative Agent to the Lender from any other source against any amount due
to the Administrative Agent under this paragraph (e).

 

50

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

(f) Status of Lenders.

(i) Any Lender that is entitled to an exemption from, or reduction of
withholding Tax with respect to payments made under any Credit Document shall
deliver to the Borrower and the Administrative Agent, at the time or times
reasonably requested by the Borrower or the Administrative Agent, such properly
completed and executed documentation reasonably requested by the Borrower or the
Administrative Agent as will permit such payments to be made without withholding
or at a reduced rate of withholding. In addition, any Lender, if reasonably
requested by the Borrower or the Administrative Agent, shall deliver such other
documentation prescribed by applicable law or reasonably requested by the
Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements. Notwithstanding
anything to the contrary in the preceding two sentences, the completion,
execution and submission of such documentation (other than such documentation
set forth in Section 2.17(f)(ii)(A), (f)(ii)(B) and (f)(ii)(D) below) shall not
be required if in the Lender’s reasonable judgment such completion, execution or
submission would subject such Lender to any material unreimbursed cost or
expense or would materially prejudice the legal or commercial position of such
Lender.

(ii) Without limiting the generality of the foregoing, in the event that the
Borrower is a U.S. Person,

(A) any Lender that is a U.S. Person shall deliver to the Borrower and the
Administrative Agent on or prior to the date on which such Lender becomes a
Lender under this Agreement (and from time to time thereafter upon the
reasonable request of the Borrower or the Administrative Agent), executed
originals of IRS Form W-9 certifying that such Lender is exempt from
U.S. Federal backup withholding tax;

(B) any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), whichever of the following is applicable;

(1) In the case of a Foreign Lender claiming the benefits of an income tax
treaty to which the United States is a party (x) with respect to payments of
interest under any Credit Document, executed originals of IRS Form W-8BEN
establishing an exemption from, or reduction of, U.S. Federal withholding Tax
pursuant to the “interest” article of such tax treaty and (y) with respect to
any other applicable payments under any Credit Document, IRS Form W-8BEN
establishing an exemption from, or reduction of, U.S. Federal withholding Tax
pursuant to the “business profits” or “other income” article of such tax treaty;

 

51

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

(2) Executed originals of IRS Form W-8ECI;

(3) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code (x) a certificate
substantially in the form of Exhibit B-1 to the effect that such Foreign Lender
is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10
percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B)
of the Code or a “controlled foreign corporation” described in
Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and
(y) executed originals of IRS Form W-8BEN; or

(4) to the extent a Foreign Lender is not the Beneficial Owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, a
U.S. Tax Compliance Certificate substantially in the form of Exhibit B-2 or
Exhibit B-3, IRS Form W-9, and/or other certificate documents from each
Beneficial Owner as applicable; provided that if the Foreign Lender is a
partnership and one or more direct or indirect partners of such Foreign Lender
are claiming the portfolio interest exemption, such Foreign Lender may provide a
U.S. Tax Compliance Certificate substantially in the form of Exhibit B-4 on
behalf of each such direct and indirect partner;

(C) any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), executed originals of any other form prescribed by applicable law as a
basis for claiming exemption from or a reduction in U.S. Federal withholding Tax
duly completed, together with such supplementary documentation as may be
prescribed by applicable law to permit the Borrower or the Administrative Agent
to determine the withholding or deduction required to be made; and

(D) if a payment made to a Lender under any Credit Document would be subject to
U.S. Federal withholding Tax imposed by FATCA if such Lender were to fail to
comply with the applicable reporting requirements of FATCA (including those
contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender
shall deliver to the Borrower and the Administrative Agent at the time or times
prescribed by law and at such time or times reasonably requested by the Borrower
or the Administrative Agent, such documentation prescribed by applicable law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrower or the
Administrative Agent as may be necessary for the Borrower or the Administrative
Agent to comply with their obligations under FATCA and to determine that such
Lender has complied with such Lender’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment. Solely for purposes of this
clause (D), “FATCA” shall include any amendments made to FATCA after the date of
this Agreement.

(iii) Each Lender agrees that if any form or certification it previously
delivered expires or becomes obsolete or inaccurate in any respect, it shall
update such form or certification or promptly notify the Borrower and the
Administrative Agent in writing of its legal inability to do so.

 

52

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

(g) Treatment of Certain Refunds. If any party determines, in its sole
discretion exercised in good faith, that it has received a refund of any Taxes
as to which it has been indemnified pursuant to this Section 2.17 (including by
the payment of additional amounts pursuant to this Section 2.17), it shall pay
to the indemnifying party an amount equal to such refund (but only to the extent
of indemnity payments made under this Section 2.17 with respect to the Taxes
giving rise to such refund), net of all out-of-pocket expenses (including Taxes)
of such indemnified party and without interest (other than any interest paid by
the relevant Governmental Authority with respect to such refund). Such
indemnifying party, upon the request of such indemnified party, shall repay to
such indemnified party the amount paid over pursuant to this paragraph (g) (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) in the event that such indemnified party is required to repay such
refund to such Governmental Authority. Notwithstanding anything to the contrary
in this paragraph (g), in no event will the indemnified party be required to pay
any amount to an indemnifying party pursuant to this paragraph (g) the payment
of which would place the indemnified party in a less favorable net after-Tax
position than the indemnified party would have been in if the Tax subject to
indemnification had not been deducted, withheld or otherwise imposed and the
indemnification payments or additional amounts giving rise to such refund had
never been paid. This paragraph shall not be construed to require any
indemnified party to make available its Tax returns (or any other information
relating to its Taxes that it deems confidential) to the indemnifying party or
any other Person.

(h) Survival. Each party’s obligations under this Section 2.17 shall survive the
resignation or replacement of the Administrative Agent or any assignment of
rights by, or the replacement of, a Lender, the termination of the Commitments
and the repayment, satisfaction or discharge of all obligations under any Credit
Document.

(i) Issuing Bank. For purposes of this Section 2.17, the term “Lender” includes
any Issuing Bank.

SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.
(a) The Borrower shall make each payment required to be made by it hereunder
(whether of principal, interest, fees or reimbursement of LC Disbursements, or
of amounts payable under Section 2.15, 2.16 or 2.17, or otherwise) prior to
12:00 noon, New York City time, on the date when due, in immediately available
funds, without set off or counterclaim. Any amounts received after such time on
any date may, in the discretion of the Administrative Agent, be deemed to have
been received on the next succeeding Business Day for purposes of calculating
interest thereon. All such payments shall be made to the Administrative Agent at
its offices at 270 Park Avenue, New York, New York, except payments to be made
directly to the Issuing Bank or Swingline Lender as expressly provided herein
and except that payments pursuant to Sections 2.15, 2.16, 2.17 and 9.03 shall be
made directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for the account of any other Person
to the appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension. All payments hereunder shall be made in Dollars.

 

53

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

(b) If at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, unreimbursed LC
Disbursements, interest and fees then due hereunder, such funds shall be applied
(i) first, towards payment of interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (ii) second, towards payment of principal
and unreimbursed LC Disbursements then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and unreimbursed LC
Disbursements then due to such parties.

(c) If any Lender shall, by exercising any right of set off or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Revolving Loans or participations in LC Disbursements, its Term Loans or its
Swingline Loans resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Revolving Loans and participations in
LC Disbursements, Term Loans and Swingline Loans and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such
greater proportion shall purchase (for cash at face value) participations in the
Revolving Loans and participations in LC Disbursements, Term Loans and Swingline
Loans of other Lenders without recourse or warranty from the other Lenders
except as contemplated by Section 9.04 in respect of assignments to the extent
necessary so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Revolving Loans, Term Loans and
participations in LC Disbursements and Swingline Loans; provided that (i) if any
such participations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans or
participations in LC Disbursements to any assignee or participant, other than to
the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions
of this paragraph shall apply). The Borrower consents to the foregoing and
agrees, to the extent it may effectively do so under applicable law, that any
Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower rights of set-off and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the
Borrower in the amount of such participation.

(d) Unless the Administrative Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Administrative Agent for
the account of the Lenders or the Issuing Bank hereunder that the Borrower will
not make such payment, the Administrative Agent may assume that the Borrower has
made such payment on such date in accordance herewith and may, in reliance upon
such assumption, distribute to the Lenders or the Issuing Bank, as the case may
be, the amount due. In such event, if the Borrower has not in fact made such
payment, then each of the Lenders or the Issuing Bank, as the case may be,
severally agrees to repay to the Administrative Agent forthwith on demand the
amount so distributed to such Lender or Issuing Bank with interest thereon, for
each day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation.

 

54

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

(e) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.05(c), 2.06(d) or (e), 2.07(b), 2.18(d) or 9.03(c), then
the Administrative Agent may, in its discretion and notwithstanding any contrary
provision hereof, (i) apply any amounts thereafter received by the
Administrative Agent for the account of such Lender and for the benefit of the
Administrative Agent, the Swingline Lender or the Issuing Bank to satisfy such
Lender’s obligations under such Sections until all such unsatisfied obligations
are fully paid, and/or (ii) hold any such amounts in a segregated account over
which the Administrative Agent shall have exclusive control as cash collateral
for, and application to, any future funding obligations of such Lender under any
such Section, in the case of each of clause (i) and (ii) above, in any order as
determined by the Administrative Agent in its discretion.

SECTION 2.19. Mitigation Obligations; Replacement of Lenders.

(a) If any Lender or an affected Lender under Section 2.14(b) requests
compensation under Section 2.15, or if the Borrower is required to pay any
Indemnified Taxes or additional amounts to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, then such
Lender shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Sections 2.15 or 2.17, as the case may be, in the
future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

(b) If any Lender or an affected Lender under Section 2.14(b) requests
compensation under Section 2.15, or if the Borrower is required to pay any
Indemnified Taxes or additional amounts to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, or if any
Lender becomes a Defaulting Lender, then the Borrower may, at its sole expense
and effort, upon notice to such Lender and the Administrative Agent, require
such Lender to assign and delegate, without recourse (in accordance with and
subject to the restrictions contained in Section 9.04), all its interests,
rights (other than its existing rights to payments pursuant to Sections 2.15 or
2.17) and obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the prior
written consent of the Administrative Agent (and if a Commitment is being
assigned, the Issuing Bank), which consent shall not unreasonably be withheld,
(ii) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and participations in LC Disbursements and
Swingline Loans, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder, from the assignee (to the extent of such outstanding
principal and accrued interest and fees) or the Borrower (in the case of all
other amounts) and (iii) in the case of any such assignment resulting from a
claim for compensation under Section 2.15 or payments required to be made
pursuant to Section 2.17, such assignment will result in a reduction in such
compensation or payments. A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the Borrower to require such
assignment and delegation cease to apply.

 

55

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

SECTION 2.20. Defaulting Lenders.

Notwithstanding any provision of this Agreement to the contrary, if any Lender
becomes a Defaulting Lender, then the following provisions shall apply for so
long as such Lender is a Defaulting Lender:

(a) fees shall cease to accrue on the unfunded portion of the Commitment of such
Defaulting Lender pursuant to Section 12(a);

(b) the Commitments, LC Exposure and Revolving Credit Exposure of such
Defaulting Lender shall not be included in determining whether the Required
Lenders have taken or may take any action hereunder (including any consent to
any amendment or waiver pursuant to Section 9.02), provided that this clause
(b) shall not apply to the vote of a Defaulting Lender in the case of an
amendment, waiver or other modification requiring the consent of such Lender or
each Lender affected thereby;

(c) if any Swingline Exposure or LC Exposure exists at the time a Lender becomes
a Defaulting Lender then:

(i) all or any part of such Swingline Exposure and LC Exposure shall be
reallocated among the non-Defaulting Lenders in accordance with their respective
Applicable Percentages but only to the extent that (x) the sum of all
non-Defaulting Lenders’ Revolving Credit Exposures plus such Defaulting Lender’s
Swingline Exposure and LC Exposure does not exceed the total of all
non-Defaulting Lenders’ Commitments and (y) the conditions set forth in
Section 4.02 are satisfied at such time;

(ii) if the reallocation described in clause (i) above cannot, or can only
partially, be effected, the Borrower shall within one Business Day following
notice by the Administrative Agent (x) first, prepay such Swingline Exposure and
(y) second, cash collateralize for the benefit of the Issuing Bank only the
Borrower’s obligations corresponding to such Defaulting Lender’s LC Exposure
(after giving effect to any partial reallocation pursuant to clause (i) above)
in accordance with the procedures set forth in Section 2.06(j) for so long as
such LC Exposure is outstanding;

(iii) if the Borrower cash collateralizes any portion of such Defaulting
Lender’s LC Exposure pursuant to clause (ii) above, the Borrower shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 2.12(b)
with respect to such Defaulting Lender’s LC Exposure during the period such
Defaulting Lender’s LC Exposure is cash collateralized;

(iv) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to
clause (i) above, then the fees payable to the Lenders pursuant to
Section 2.12(a) and Section 2.12(b) shall be adjusted in accordance with such
non-Defaulting Lenders’ Applicable Percentages; or

 

56

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

(v) if all or any portion of such Defaulting Lender’s LC Exposure is neither
cash collateralized nor reallocated pursuant to clause (i) or (ii) above, then,
without prejudice to any rights or remedies of the Issuing Bank or any other
Lender hereunder, all facility fees that otherwise would have been payable to
such Defaulting Lender (solely with respect to the portion of such Defaulting
Lender’s Commitment that was utilized by such LC Exposure) and letter of credit
fees payable under Section 2.12(b) with respect to such Defaulting Lender’s LC
Exposure shall be payable to the Issuing Bank until such LC Exposure is cash
collateralized and/or reallocated; and

(d) so long as such Lender is a Defaulting Lender, the Swingline Lender shall
not be required to fund any Swingline Loan and the Issuing Bank shall not be
required to issue, amend or increase any Letter of Credit, unless it is
satisfied that the related exposure and the Defaulting Lender’s then outstanding
LC Exposure will be 100% covered by the Commitments of the non-Defaulting
Lenders and/or cash collateral will be provided by the Borrower in accordance
with Section 2.20(c), and participating interests in any such newly issued or
increased Letter of Credit or newly made Swingline Loan shall be allocated among
non-Defaulting Lenders in a manner consistent with Section 2.20(c)(i) (and such
Defaulting Lender shall not participate therein).

If (i) a Bankruptcy Event with respect to a Lender Parent of any Lender shall
occur following the date hereof and for so long as such event shall continue or
(ii) the Swingline Lender or the Issuing Bank has a good faith belief that any
Lender has defaulted in fulfilling its obligations under one or more other
agreements in which such Lender commits to extend credit, the Swingline Lender
shall not be required to fund any Swingline Loan and the Issuing Bank shall not
be required to issue, amend or increase any Letter of Credit, unless the
Swingline Lender or the Issuing Bank, as the case may be, shall have entered
into arrangements with the Borrower or such Lender, satisfactory to the
Swingline Lender or the Issuing Bank, as the case may be, to defease any risk to
it in respect of such Lender hereunder.

In the event that the Administrative Agent, the Borrower, the Swingline Lender
and the Issuing Bank each agrees that a Defaulting Lender has adequately
remedied all matters that caused such Lender to be a Defaulting Lender, then the
Swingline Exposure and LC Exposure of the Lenders shall be readjusted to reflect
the inclusion of such Lender’s Commitment and on such date such Lender shall
purchase at par such of the Loans of the other Lenders (other than Swingline
Loans) as the Administrative Agent shall determine may be necessary in order for
such Lender to hold such Loans in accordance with its Applicable Percentage.

 

57

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

ARTICLE III

Representations and Warranties

Each of the Parent, the Borrower and each other Credit Party represents and
warrants to the Administrative Agent and the Lenders that:

SECTION 3.01. Organization; Powers. Each of the Credit Parties and its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.

SECTION 3.02. Authorization; Enforceability. The Transactions are within each of
the Credit Parties’ corporate powers and have been duly authorized by all
necessary corporate and, if required, stockholder action. Each Credit Document
has been duly executed and delivered by each Credit Party thereto and
constitutes a legal, valid and binding obligation of each such Credit Party,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.

SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except such as have been obtained or made
and are in full force and effect, (b) will not violate any applicable law or
regulation or the charter, by-laws or other organizational documents of each
Credit Party or any of its Subsidiaries or any order of any Governmental
Authority, (c) will not violate or result in a default under any indenture,
material agreement or other material instrument binding upon any Credit Party or
any of its Subsidiaries or its assets, or give rise to a right thereunder to
require any payment to be made by any Credit Party or any of its Subsidiaries,
and (d) will not result in the creation or imposition of any Lien on any asset
of any Credit Parties or any of its Subsidiaries except Liens created under the
Credit Documents.

SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The Borrower
has heretofore furnished to the Lenders a consolidated balance sheet and
statements of income, stockholders equity and cash flows of the Parent (i) as of
and for the Fiscal Year ended February 29, 2012, reported on by Ernst & Young
LLP, independent public accountants, and (ii) as of and for the Fiscal Quarter
and the portion of the Fiscal Year ended August 31, 2012, certified by its chief
financial officer. Such financial statements present fairly, in all material
respects, the financial position and results of operations and cash flows of the
Parent and its consolidated subsidiaries as of such dates and for such periods
in accordance with GAAP, subject to year-end audit adjustments and the absence
of footnotes in the case of the statements referred to in clause (ii) above.

(b) No event, change or condition has occurred that has had, or could reasonably
be expected to have, a Material Adverse Effect, since February 29, 2012.

(c) The Parent, the Borrower and each of the Subsidiaries has a fiscal year
which is the twelve (12) months ending on February 28, or in the case of a leap
year, February 29, of each calendar year.

 

58

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

(d) Each of the Foreign Subsidiaries has a fiscal year which is twelve
(12) months ending on December 31 of each calendar year.

SECTION 3.05. Properties. (a) As of the date of this Agreement, Schedule 3.05(a)
sets forth the address of each parcel of real property that is owned or leased
(with respect to each parcel of leased real property with a fair market value or
contractual value of $100,000 or more) by each Credit Party. Each of such leases
and subleases is valid and enforceable in accordance with its terms and is in
full force and effect, and no default by any party to any such lease or sublease
exists. Each of the Credit Parties and its Subsidiaries has good and
indefeasible title to, or valid leasehold interests in, all of its real and
personal property, free of all Liens other than those permitted by Section 6.02.

(b) Each Credit Party and each of its Subsidiaries (i) owns, or is licensed to
use, all trademarks, trade names, copyrights, patents and other intellectual
property material to its business, and the use thereof by each Credit Party and
its Subsidiaries does not infringe upon the rights of any other Person, except
for any such infringements that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect and (ii) possesses
all material franchises, licenses and permits, and rights in respect of the
foregoing, necessary for the conduct of its business substantially as now
conducted without known material conflict with any rights of others.

(c) Schedule 3.05(c) sets forth all of the Stations of the Borrower and its
Subsidiaries at the time of reference thereto.

(d) Schedule 3.05(d) sets forth all of the Magazines owned by the Borrower and
its Subsidiaries at the time of reference thereto and the Borrower and its
Subsidiaries own all material trademarks in the titles of such Magazines as
published.

SECTION 3.06. Litigation and Environmental Matters. (a) Except as set forth on
Schedule 3.06(a), there are no actions, suits or proceedings by or before any
arbitrator or Governmental Authority pending against or, to the knowledge of any
Credit Party, threatened against or affecting any Credit Party or any of its
Subsidiaries (i) as to which there is a reasonable possibility of an adverse
determination and that, if adversely determined, could reasonably be expected,
individually or in the aggregate, to result in a Material Adverse Effect or
(ii) that involve this Agreement or the Transactions.

(b) Schedule 3.06(b) sets forth a summary of all of the pending FCC proceedings
against any Credit Party or its Subsidiaries as of the Effective Date. Except
for proceedings affecting the television and radio broadcasting industries
generally, there is not pending or, to the best knowledge of any Credit Party,
threatened against any Credit Party, any of its Subsidiaries, the Stations or
the FCC Licenses, any action, petition, objection, notice of violation, notice
of proposed forfeiture, complaint (formal or informal), competing application,
investigation or other pleading, or any proceeding with the FCC that, in each
case as to which there is a reasonable possibility of an adverse determination
and that, if adversely determined, could reasonably be expected, individually or
in the aggregate, to result in a Material Adverse Effect. As of the Effective
Date, neither any Credit Party and nor any of its Subsidiaries have any material
additional information concerning complaints set forth in Schedule 3.06(b), or
knowledge of any other formal or informal complaints submitted to the FCC.

 

59

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

(c) Except with respect to any other matters that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, neither any Credit Party nor any of its Subsidiaries (i) has failed to
comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii) has
become subject to any Environmental Liability, (iii) has received notice of any
claim with respect to any Environmental Liability or (iv) knows of any basis for
any Environmental Liability.

SECTION 3.07. Compliance with Laws and Agreements. Each Credit Party and each of
its Subsidiaries is in compliance with all laws, regulations and orders of any
Governmental Authority applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except where
the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect. No Default has occurred and is
continuing. Neither any Credit Party nor any Subsidiary is a party to any
agreement or instrument or subject to any charter or other corporate restriction
which could reasonably be expected to have a Material Adverse Effect. The
proceeds of the Loans and the Letters of Credit shall only be used as set forth
in Section 5.08.

SECTION 3.08. Investment Company Status; Margin Stock.

(a) Neither any Credit Party nor any of its Subsidiaries is an “investment
company” as defined in, or subject to regulation under, the Investment Company
Act of 1940.

(b) Margin stock (as defined in Regulation U of the Board of Governors of the
Federal Reserve System) constitutes less than 25% of the value of those assets
of the Borrower and its Subsidiaries which are subject to any limitation on
sale, pledge, or other restriction hereunder. Neither the making of any Loan or
issuance of any Letters of Credit hereunder, the use of the proceeds thereof,
nor any other aspect of the financing of the Acquisition, will violate or be
inconsistent with the provisions of Regulation T, Regulation U or Regulation X
of the Board of Governors of the Federal Reserve System.

SECTION 3.09. Taxes. Each Credit Party and each of its Subsidiaries has timely
filed or caused to be filed all Tax returns and reports required to have been
filed and has paid or caused to be paid all Taxes required to have been paid by
it, except (a) Taxes that are being contested in good faith by appropriate
proceedings and for which such Credit Party or such Subsidiary, as applicable,
has set aside on its books adequate reserves or (b) to the extent that the
failure to do so could not reasonably be expected to result in a Material
Adverse Effect. No Tax liens have been filed and no claims are being asserted
with respect to any such Taxes.

SECTION 3.10. ERISA.

(a) No ERISA Event has occurred or is reasonably expected to occur that, when
taken together with all other such ERISA Events for which liability has occurred
or is reasonably expected to occur, could reasonably be expected to result in a
Material Adverse Effect.

 

60

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

(b) Each Foreign Pension Plan has been maintained in substantial compliance with
its terms and in substantial compliance with the requirements of any and all
applicable laws, statutes, rules, regulations and orders and has been
maintained, where required, in good standing with applicable regulatory
authorities. All contributions required to be made with respect to a Foreign
Pension Plan have been timely made. Neither the Borrower nor any of its
Subsidiaries (including the Excluded Subsidiaries) has incurred any material
obligation in connection with the termination of or withdrawal from any Foreign
Pension Plan. The present value of the accrued benefit liabilities (whether or
not vested) under each Foreign Pension Plan, determined as of the end of the
Borrower’s most recently ended Fiscal Year on the basis of actuarial
assumptions, each of which is reasonable, did not exceed the current value of
the assets of such Foreign Pension Plan allocable to such benefit liabilities.

SECTION 3.11. Disclosure. Each of the Parent and the Borrower has disclosed to
the Lenders all agreements, instruments and corporate or other restrictions to
which it or any of its Subsidiaries is subject, and all other matters known to
it, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect. Neither the Information Memorandum nor any
of the other reports, financial statements, certificates or other information
furnished by or on behalf of the Parent or the Borrower to the Administrative
Agent or any Lender in connection with the negotiation of this Agreement or
delivered hereunder (as modified or supplemented by other information so
furnished) when taken as a whole contains any material misstatement of fact or
omits to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided that, with respect to projected financial information, the Borrower
represents only that such information was prepared in good faith based upon
assumptions believed to be reasonable at the time.

SECTION 3.12. Patriot Act. To the extent applicable, the Parent, the Borrower
and each Subsidiary is in compliance, in all material respects, with the
(a) Trading with the Enemy Act, as amended, and each of the foreign assets
control regulations of the United States Treasury Department (31 CFR, Subtitle
B, Chapter V, as amended) and any other enabling legislation or executive order
relating thereto, and (b) USA PATRIOT Act. No part of the proceeds of the Loans
will be used, directly or indirectly, for any payments to any governmental
official or employee, political party, official of a political party, candidate
for political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as amended.

SECTION 3.13. Material Agreements. (a) No Credit Party or any Subsidiary is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in (i) any material agreement to which it is a
party, (ii) any agreement or instrument evidencing or governing Indebtedness and
(b) all material radio or television network affiliation, programming,
engineering, consulting, management, employment and related agreements, if any,
of the Borrower and its Subsidiaries which are presently in effect in connection
with, and are material and necessary to, the conduct of the business of the
Borrower or any of its Subsidiaries, including without limitation the operation
of any Station by the Borrower or any of its Subsidiaries, are valid, subsisting
and in full force and effect and none of the Borrower, any of its Subsidiaries
or, to the Borrower’s best knowledge, any other Person are in material default
thereunder.

 

61

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

SECTION 3.14. Security Interests in Collateral. The provisions of the Collateral
Documents create legal and valid Liens on all the Collateral in favor of the
Administrative Agent, for the benefit of the Administrative Agent, the Lenders
and the other holders of the Secured Obligations, and when the actions described
in such Collateral Documents are completed, such Liens constitute perfected and
continuing Liens on the Collateral, securing the Secured Obligations,
enforceable against the applicable Credit Party and all third parties, and
having priority over all other Liens on the Collateral except in the case of
(a) Permitted Encumbrances, to the extent any such Permitted Encumbrances would
have priority over the Liens in favor of the Administrative Agent pursuant to
any applicable law and (b) Liens perfected only by possession (including
possession of any certificate of title) to the extent the Administrative Agent
has not obtained or does not maintain possession of such Collateral.

SECTION 3.15. Solvency.

(a) Immediately after the consummation of the Transactions to occur on the
Effective Date, (i) the fair value of the assets of each Credit Party, at a fair
valuation, will exceed its debts and liabilities, subordinated, contingent or
otherwise; (ii) the present fair saleable value of the property of each Credit
Party will be greater than the amount that will be required to pay the probable
liability of its debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured;
(iii) each Credit Party will be able to pay its debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured; and (iv) each Credit Party will not have unreasonably
small capital with which to conduct the business in which it is engaged as such
business is now conducted and is proposed to be conducted after the Effective
Date.

(b) No Credit Party intends to, or will permit any of its Subsidiaries to, and
no Credit Party believes that it or any of its Subsidiaries will, incur debts
beyond its ability to pay such debts as they mature, taking into account the
timing of and amounts of cash to be received by it or any such Subsidiary and
the timing of the amounts of cash to be payable on or in respect of its
Indebtedness or the Indebtedness of any such Subsidiary.

SECTION 3.16. Licenses and Approvals.

(a) Each of the Borrower and its Subsidiaries has all requisite power and
authority to hold the Necessary Authorizations and to own and operate its
Stations and to carry on its businesses as now conducted, all in material
compliance with the Communications Act.

(b) Set forth in Schedule 3.16 hereto as of the Effective Date, is an accurate
and complete list, with current dates of expiration, of (A) all FCC Licenses, or
any other Governmental Authority now held by the Borrower or any of its
Subsidiaries, which includes all material authorizations, licenses, permits and
franchises for the operation of its Stations, and any ancillary broadcast
facilities identified on Schedule 3.16, and (B) all current construction
permits, if any, granted to the Borrower or any of its Subsidiaries by the FCC.
Schedule 3.16 lists all of the authorizations, licenses, and permits as of the
Effective Date required by the FCC in connection with the operation by Borrower
or any of its Subsidiaries of its Stations as presently operated or proposed to
be operated. Schedule 3.16 also identifies as of the Effective Date any
applications, petitions or requests currently pending before the FCC that were
filed by Borrower or any of its Subsidiaries with respect to, or otherwise
relating to, the FCC Licenses or the underlying Stations. Complete and correct
copies of all such FCC Licenses as of the Effective Date have been delivered to
the Administrative Agent. Schedule 3.16 (as updated from time to time in
accordance with Section 6.03 and 6.04, as applicable, with respect to FCC
Licenses that are Necessary Authorizations) lists all of the main station FCC
Licenses required by the FCC in connection with the operation by Borrower or any
of its Subsidiaries of its Stations as presently operated or proposed to be
operated.

 

62

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

(c) Each FCC License that is a Necessary Authorization is validly issued and in
full force and effect and is free and clear of any conditions that might limit
the operation of the Stations other than those restrictions stated on the face
of such FCC License or otherwise generally imposed on broadcast stations of like
authority. Except as identified on Schedule 3.16, FCC Licenses that are
Necessary Authorizations were duly issued by Final FCC Orders in the names of or
validly assigned to, the Borrower or its Subsidiary as identified on Schedule
3.16 and each such Borrower or its Subsidiary is, and on the Effective Date will
be, the holder of the FCC Licenses.

(d) As to each FCC License that is a Necessary Authorization that has expired by
its terms, a timely renewal application has been filed and the Borrower and/or
its Subsidiaries has FCC authority to continue operating the applicable Station
pending FCC action on such application. The Borrower and its Subsidiaries have
no reason to believe that the FCC Licenses are not likely to be renewed in the
ordinary course or that the holder of each such FCC License would be denied a
renewal expectancy as provided for in the Communications Act.

(e) Neither the Borrower nor any of its Subsidiaries has granted any liens or
security interests in such FCC Licenses to any party other than the Agent for
the benefit of the Lenders. Except as permitted by Section 6.03 of this
Agreement, neither the Borrower nor any of its Subsidiaries has assigned,
transferred, conveyed or otherwise disposed of any of the FCC Licenses to any
third party, or committed to take any of such actions. Except as permitted by
Section 6.03 of this Agreement, no person other than the Borrower and/or any of
its Subsidiaries has any right, title or interest (legal or beneficial) in or
to, or any right or license to use, any FCC License or the spectrum authorized
by such FCC Licenses, except for those parties who have entered into brokered
time arrangements or have contracted for program or advertising placement or
data-casting on the associated Stations, pursuant to an agreement or
understanding with the Borrower or any of its Subsidiaries. The Borrower and its
Subsidiaries are the sole parties authorized by the FCC to have, and on the
Effective Date will have, the absolute and unrestricted right, power and
authority under the Communications Act to hold the FCC Licenses and, by their
FCC Licenses, to control the use of the spectrum authorized to Borrower and its
Subsidiaries under the operating parameters of their FCC Licenses.

(f) No event has occurred or, to the best of Borrower’s or any of its
Subsidiaries’ knowledge, no condition or state of facts exists, and no notice
has been received from the FCC, which is reasonably likely to result in
rescission, revocation, termination, cancellation, suspension or non-renewal of
the FCC Licenses that are Necessary Authorizations, or which is reasonably
likely to result in such FCC Licenses becoming subject to adverse conditions
outside of the ordinary course of business, or that would materially and
adversely affect the ownership and/or operation of the Stations as authorized by
the terms of such FCC Licenses and the Communications Act or adversely and
materially affect the rights of Borrower or any of its Subsidiaries.

 

63

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

(g) Except as set forth on Schedule 3.06(b) and Schedule 3.16, as of the
Effective Date, each Credit Party and each of its Subsidiaries is in compliance
in all material respects with all requirements of the Communications Act which
are applicable to the Stations or the FCC Licenses. The Borrower or such
Subsidiary is taking all reasonable and appropriate steps to contest or mitigate
its potential liabilities in respect of any such exceptions and has set aside on
its books adequate reserves in conformity with GAAP with respect thereto.

(h) Except as set forth on Schedule 3.06(b) and Schedule 3.16, no event has
occurred or, to the best of the knowledge of Borrower and each of its
Subsidiaries, been threatened, which: (i) has resulted in, or after notice or
lapse of time or both would result in, revocation or termination of any FCC
License that is a Necessary Authorization, or (ii) materially and adversely
affects or in the future could reasonably be expected to materially adversely
affect any of the rights of the Borrower or any of its Subsidiaries under any
such FCC License.

(i) [Intentionally Omitted].

(j) The Borrower and each Subsidiary is in compliance with the provisions of
Section 310 of the Communications Act of 1934, as amended, relating to the
interest of aliens and foreign governments.

(k) Except as set forth in Schedule 3.16(k), the Borrower and each Subsidiary
are in compliance with the provisions of Section 73.3555 of the FCC rules as
they affect the Stations.

(l) All FCC Licenses and other licenses, permits and approvals relating to the
Stations are held by a Subsidiary of Borrower. No such Subsidiary (A) owns or
holds any assets (including the ownership of stock or any other interest in any
Person) other than FCC Licenses and other licenses, permits and approvals
relating to the Stations, (B) is engaged in any business other than the holding,
acquisition and maintenance of FCC Licenses and other licenses, permits and
approvals relating to the Stations, (C) has any Investments in any Person other
than the Borrower or a Subsidiary or (D) owes any Indebtedness (other than
(x) Indebtedness to the Administrative Agent and the Lenders pursuant to a
Guaranty and (y) contingent obligations pursuant to Subordinated Indebtedness
consisting of guaranties of Subordinated Indebtedness to any Person other than
the Borrower).

(m) Without limiting the generality of the foregoing, in all material respects:

(i) each of the Borrower and its Subsidiaries has (x) filed all required
reports, applications, documents, instruments and information required to be
filed by Borrower and its Subsidiaries during the previous twelve months
pursuant to applicable rules and regulations or requests of any Governmental
Authority having jurisdiction over any of its FCC Licenses, Stations or the
activities or business of Borrower and its Subsidiaries with respect thereto;
(y) paid all FCC annual regulatory fees assessed with respect to its FCC
Licenses; and (z) made all required submissions, including, but not limited to,
the payment of any fees required to be submitted to, the FCC by the Borrower or
its Subsidiaries with respect to the Stations during the previous twelve months.
All reports and submissions referenced in (x) and (z) above were correct at the
time of filing and the most recent reports and submissions are correct as of the
Effective Date;

 

64

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

(ii) the operation of the Stations is in compliance with ANSI Standards
C95.1-1992 to the extent required under applicable rules and regulations;

(iii) all of the existing towers, used in the operation of the Stations, owned
or leased by the Borrower or any of its Subsidiaries (if leased by the Borrower
or any of its Subsidiaries, to the best of the Borrower’s and its Subsidiaries’
knowledge), are, by action of the owners of the towers, obstruction-marked and
lighted to the extent required by and in accordance with, the rules and
regulations of the FCC and FAA, and appropriate notification has been made by
the owners of the towers to the FCC and FAA for each such tower where required
by the rules and policies of the FCC and/or the FAA. The Borrower and its
Subsidiaries have no reason to believe that (a) any such required FCC or FAA
filings have not been made; and (b) all towers used by the Stations are
otherwise not in compliance with FCC and FAA rules and requirements regarding
such towers;

(iv) each Station’s main studio is located in compliance with the FCC’s rules
and regulations and is operating as a lawful main studio;

(v) each Station maintains all required Emergency Alert System facilities on
site in compliance with FCC rules;

(vi) each Station’s public inspection file contains all the documentation
required by FCC rules, including Section 73.3526 of the FCC rules. For each
calendar quarter during the current license term, the public inspection file
contains an Issues/Programs Report as specified by FCC rules;

(vii) any LMA Agreement to which Borrower or any of its Subsidiaries is a party
and which concerns any Station is fully compliant with the FCC’s rules and
policies affecting such agreements, including the requirement that Borrower or
any of its Subsidiaries, as licensees of the Stations, shall fully retain de
jure and de facto control over the FCC Licenses and the Stations; and

(viii) the Borrower and each affected Subsidiary are in compliance with the
terms of any consent decree entered into with the FCC that is currently in
effect.

SECTION 3.17. Subsidiaries; Excluded Subsidiaries.

(a) As of the date hereof, the Parent has no Subsidiaries (including Excluded
Subsidiaries) except those listed in Schedule 3.17. Schedule 3.17 correctly sets
forth, as of the Effective Date, (i) the percentage ownership (direct or
indirect) of the applicable Credit Party in each class of capital stock or other
equity of its Subsidiaries (including Excluded Subsidiaries) and also identifies
the direct owner thereof, and (ii) the jurisdiction of organization of each such
Subsidiary (including Excluded Subsidiaries).

 

65

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

(b) The entities set forth in clause (a) of the definition of “Excluded
Subsidiaries” do not own or operate any Station, broadcasting business or
publishing business within the United States and either own no assets or own
only stock of Persons whose primary businesses are owning or operating
broadcasting businesses outside the United States, or own and operate
broadcasting businesses outside the United States.

SECTION 3.18. Insurance. The Parent, the Borrower and each Subsidiary maintains
with financially sound and reputable insurance companies insurance on all their
property in such amounts and covering such risks as is consistent with sound
business practice.

SECTION 3.19. Labor. Neither the Borrower nor any of its Subsidiaries is engaged
in any unfair labor practice that could reasonably be expected to have a
Material Adverse Effect. There is (a) no significant unfair labor practice
complaint pending against the Borrower or any of its Subsidiaries or, to the
best knowledge of the Borrower, threatened against any of them before the
National Labor Relations Board or any similar Governmental Authority in any
jurisdiction, and no significant grievance or significant arbitration proceeding
arising out of or under any collective bargaining agreement is so pending
against the Borrower or any of its Subsidiaries or, to the best knowledge of the
Borrower, threatened against any of them, (b) no significant strike, labor
dispute, slowdown or stoppage is pending against the Borrower or any of its
Subsidiaries or, to the best knowledge of the Borrower, threatened against the
Borrower or any of its Subsidiaries and (c) to the best knowledge of the
Borrower, no question concerning union representation exists with respect to the
employees of the Borrower or any of its subsidiaries, except (with respect to
any matter specified in clause (a), (b) or (c) above, either individually or in
the aggregate) such as could not reasonably be expected to have a Material
Adverse Effect.

SECTION 3.20. Burdensome Restrictions. Neither the Parent, the Borrower nor any
of its Subsidiaries is a party to any agreement or contract or subject to any
restriction contained in its organizational documents which could reasonably be
expected to have a Material Adverse Effect.

SECTION 3.21. No Default. No Default or Event of Default exists or would result
from the incurrence by any Credit Party of any Indebtedness hereunder or under
any other Credit Document.

 

66

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

ARTICLE IV

Conditions

SECTION 4.01. Effective Date. The obligations of the Lenders to make Loans and
of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective until the date on which each of the following conditions is satisfied
(or waived in accordance with Section 9.02):

(a) Credit Documents. The Administrative Agent (or its counsel) shall have
received from each party to the Credit Documents either (i) a counterpart of
each Credit Document to which such party is a party signed on behalf of such
party or (ii) written evidence satisfactory to the Administrative Agent (which
may include telecopy transmission of a signed signature page of this Agreement)
that such party has signed a counterpart of each such agreement, in such Credit
Document being in form and substance mutually satisfactory to the Borrower and
Lenders.

(b) Opinions. The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated the
Effective Date) of (i) Paul, Weiss, Rifkind, Wharton & Garrison LLP, counsel for
the Credit Parties, (ii) FCC counsel for the Credit Parties and (iii) local
counsel to Credit Parties in Indiana and California, as applicable, in each
case, in form and substance reasonably satisfactory to the Administrative Agent,
and covering such other matters relating to the Credit Parties, the Credit
Documents or the Transactions as the Administrative Agent shall reasonably
request. The Credit Parties hereby request each such counsel to deliver such
opinion, as applicable.

(c) Secretary Certificates. The Administrative Agent shall have received such
documents and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence and good standing of
the Credit Parties, the authorization of the Transactions, the incumbency of
their respective authorized officers and any other legal matters relating to the
Credit Parties, this Agreement or the Transactions, all in form and substance
satisfactory to the Administrative Agent and its counsel.

(d) Closing Certificate. The Administrative Agent shall have received a
certificate (in form and substance reasonably satisfactory to the Administrative
Agent), dated the Effective Date and signed by the President, a Vice President
or a Financial Officer of the Borrower, (i) confirming compliance with the
conditions set forth in clauses (a) and (b) of Section 4.02, (ii) confirming
compliance with the condition set forth in clause (p) of this Section 4.01,
(iii) either (x) confirming compliance with the conditions of clause (h) of this
Section 4.01 and describing in reasonable detail or attaching copies of all
consents, licenses and approvals of Governmental Authorities and other Persons
required in connection with the execution, delivery and performance by such
Credit Party and the validity against such Credit Party of the Credit Documents
to which it is a party, and, required in connection with the Credit Documents
and the transactions contemplated thereby, and such consents, licenses and
approvals shall be in full force and effect, or (y) stating that no such
consents, licenses or approvals are so required, and (iv) confirming compliance
with all other conditions set forth in this Section 4.01.

(e) Solvency Certificate. The Administrative Agent shall have received a
certificate (in form and substance reasonably satisfactory to the Administrative
Agent), dated the Effective Date and signed by the Chief Financial Officer of
the Borrower confirming the truth and accuracy of the representation and
warranty set forth in Section 3.15.

(f) Fees. The Lenders, the Administrative Agent, the Syndication Agent and the
Arrangers shall have received all fees required to be paid, and all expenses for
which invoices have been presented (including the reasonable fees and expenses
of legal counsel), on or before the Effective Date. All such amounts will be
paid with proceeds of Loans made on the Effective Date and will be reflected in
the funding instructions given by the Borrower to the Administrative Agent on or
before the Effective Date.

 

67

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

(g) Existing Indebtedness. The Administrative Agent shall have received
(i) satisfactory evidence that all principal, interest, fees and other amounts
owing under the Existing Credit Agreement and the Existing Note Purchase
Agreement shall have been (or shall substantially contemporaneously be) repaid
in full, and (ii) satisfactory pay-off letters for all existing Indebtedness
(including, without limitation, such Indebtedness under the Existing Credit
Agreement and the Existing Note Purchase Agreement) to be repaid from the
proceeds of the initial Borrowing, confirming that all Liens upon any of the
property of the Credit Parties constituting Collateral will be terminated
concurrently with such payment and the termination of all commitments
thereunder. The Administrative Agent shall have received such duly executed
UCC-3 termination statements, mortgage releases and all other releases and
similar documents as the Administrative Agent may request with respect to any
mortgages or security interests securing Indebtedness being repaid in full on
the Effective Date.

(h) FCC Licenses; Third Party Consents. The Borrower shall have furnished to the
Administrative Agent (i) accurate and complete copies of all FCC Licenses
necessary for the operation of the business of each of the Borrower and its
Subsidiaries, or necessary for the operation of any Station owned by the
Borrower or any of the Subsidiaries, (ii) certified copies of all agreements
pursuant to which the Operating Subsidiaries shall have acquired the rights to
use the FCC Licenses held by the License Subsidiaries and (iii) all other
governmental and third party approvals, consents and notices necessary in
connection with the transactions contemplated by the Credit Documents and the
continuing operations of the Borrower and is Subsidiaries (including shareholder
approvals, if any) shall have been obtained and given and shall be in full force
and effect, and evidence thereof satisfactory to the Administrative Agent shall
have been provided to the Administrative Agent.

(i) Perfection Certificates; Lien Searches. The Administrative Agent shall have
received (i) perfection certificates from each Credit Party, in form and
substance reasonably satisfactory to the Administrative Agent and (ii) the
results of a recent Lien searches in each of the jurisdictions where assets of
the Credit Parties and their Subsidiaries are located, and such searches shall
reveal no Liens on any of the assets of the Credit Parties and their
Subsidiaries except for Liens permitted by Section 6.02 or discharged on or
prior to the Effective Date pursuant to a pay-off letter or other documentation
satisfactory to the Administrative Agent.

(j) Financial Information. The Administrative Agent shall have received
(i) satisfactory audited consolidated financial statements of the Parent for the
two most recent Fiscal Years ended prior to the Effective Date as to which such
financial statements are available, (ii) satisfactory unaudited interim
consolidated financial statements of the Parent for each Fiscal Quarterly period
ended subsequent to the date of the latest financial statements delivered
pursuant to clause (i) of this paragraph as to which such financial statements
are available, including the period ending August 31, 2012 and (iii) the
Parent’s most recent operating model for the period beginning February 2013 and
ending February 2018.

 

68

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

(k) Pledged Stock; Stock Powers; Pledged Notes. The Administrative Agent shall
have received (i) the certificates representing the shares of Equity Interests
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
pledgor thereof and (ii) each promissory note (if any) pledged to the
Administrative Agent pursuant to the Security Agreement endorsed (without
recourse) in blank (or accompanied by an executed transfer form in blank) by the
pledgor thereof.

(l) Filings, Registrations and Recordings; Validity of Liens. Each document
(including any Uniform Commercial Code financing statement) required by the
Collateral Documents or under law or reasonably requested by the Administrative
Agent to be filed, registered or recorded in order to create in favor of the
Administrative Agent, for the benefit of the Lenders, a perfected Lien on the
Collateral described therein, prior and superior in right to any other Person
(other than with respect to Liens expressly permitted by Section 6.02), shall be
in proper form for filing, registration or recordation and shall have been duly
effected or provided for. The Collateral Documents shall be effective to create
in favor of the Administrative Agent, for the benefit of the Secured Creditors,
a legal, valid and enforceable first priority security interest in and Lien upon
the Collateral.

(m) Mortgage, etc. The Administrative Agent shall have received, with respect to
the Emmis Chief Executive Office, each of the following, in form and substance
reasonably satisfactory to the Administrative Agent:

(i) a Mortgage on such property;

(ii) evidence that a counterpart of the Mortgage has been recorded in the place
necessary, in the Administrative Agent’s judgment, to create a valid and
enforceable first priority Lien in favor of the Administrative Agent for the
benefit of itself and the Lenders;

(iii) ALTA or other mortgagee’s title policy;

(iv) an ALTA survey prepared and certified to the Administrative Agent by a
surveyor acceptable to the Administrative Agent;

(v) an opinion of counsel in the state in which such parcel of real property is
located in form and substance and from counsel reasonably satisfactory to the
Administrative Agent;

(vi) if any such parcel of real property is determined by the Administrative
Agent to be in a flood zone, a flood notification form signed by the Borrower
and evidence that flood insurance is in place for the building and contents, all
in form and substance satisfactory to the Administrative Agent; and

(vii) such other information, documentation, and certifications as may be
reasonably required by the Administrative Agent.

(n) Collateral Access Agreements. The Administrative Agent shall have received
(or made arrangements satisfactory to it for the delivery of in accordance with
Section 5.13(e)) a Collateral Access Agreement with respect to each parcel of
real property (with respect to tower sites and Station sites) leased by any
Credit Party and identified on Schedule 3.05(a) hereto and located in the cities
of New York, Los Angeles and St. Louis, each in form and substance acceptable to
the Administrative Agent, to the extent obtainable after reasonable best efforts
have been used by the Credit Parties (which best efforts shall not in any case
include the making of any payment or agreeing to any lease modification).

 

69

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

(o) Insurance. The Administrative Agent shall have received evidence of
insurance coverage in form, scope, and substance reasonably satisfactory to the
Administrative Agent and otherwise in compliance with the terms of the Credit
Documents, including without limitation, insurance certificates and related
endorsements naming the Administrative Agent as additional insured or loss
payee, as applicable.

(p) Total Leverage Ratio. After giving effect to the Loans and the payment of
all fees and expenses in connection herewith, the Total Leverage Ratio shall not
exceed 5.00:1.00.

The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans and of the Issuing
Bank to issue Letters of Credit hereunder shall not become effective unless each
of the foregoing conditions is satisfied (or waived pursuant to Section 9.02) at
or prior to 3:00 p.m., New York City time, on December 31, 2012 (and, in the
event such conditions are not so satisfied or waived, the Commitments shall
terminate at such time).

SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on
the occasion of any Borrowing, and of the Issuing Bank to issue, amend, renew or
extend any Letter of Credit, is subject to the satisfaction of the following
conditions:

(a) The representations and warranties of the Credit Parties and their
Subsidiaries set forth in the Credit Documents shall be true and correct in all
material respects (without duplication of any materiality qualifier contained
therein) with the same effect as though made on and as of the date of such
Borrowing or the date of issuance, amendment, renewal or extension of such
Letter of Credit, as applicable (it being understood and agreed that any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct in all material respects only as of
such specified date, and that any representation or warranty which is subject to
any materiality qualifier shall be required to be true and correct in all
respects).

(b) At the time of and immediately after giving effect to such Borrowing or the
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no Default or Event of Default shall have occurred and be
continuing.

Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a) and
(b) of this Section.

 

70

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

ARTICLE V

Affirmative Covenants

Until the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees payable hereunder shall have been paid in
full and all Letters of Credit shall have expired or terminated, in each case,
without any pending draw, and all LC Disbursements shall have been reimbursed,
the Parent, the Borrower and each other Credit Party covenants and agrees with
the Lenders that:

SECTION 5.01. Financial Statements; Ratings Change and Other Information. The
Borrower will furnish to the Administrative Agent and each Lender:

(a) within 90 days after the end of each Fiscal Year of the Parent, (x) its
audited consolidated balance sheet and related statements of operations,
stockholders’ equity and cash flows as of the end of and for such year, setting
forth in each case in comparative form the figures for the previous Fiscal Year,
all reported on by independent public accountants of recognized national
standing (without a “going concern” or like qualification, commentary or
exception arising out of the scope of the audit, or without any qualification or
exception as to the scope of such audit) to the effect that such consolidated
financial statements present fairly in all material respects the financial
condition and results of operations of the Parent and its consolidated
subsidiaries on a consolidated basis in accordance with GAAP consistently
applied and the requirements of the SEC, together with (y) supplemental
consolidating schedules for the Parent, the Borrower and its consolidated
Financial Subsidiaries in the case of this clause (y), in a form reasonably
satisfactory to the Administrative Agent;

(b) within 45 days after the end of each of the first three Fiscal Quarters of
each Fiscal Year of the Parent (commencing with the Fiscal Quarter ended
November 30, 2012), (x) its consolidated balance sheet and related statements of
operations, stockholders’ equity and cash flows as of the end of and for such
Fiscal Quarter and the then elapsed portion of the Fiscal Year, setting forth in
each case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of) the previous
Fiscal Year, all certified by one of its Financial Officers as presenting fairly
in all material respects the financial condition and results of operations of
the Parent and its consolidated subsidiaries on a consolidated basis in
accordance with GAAP consistently applied and the requirements of the SEC,
subject to normal year-end audit adjustments and the absence of footnotes,
together with (y) supplemental consolidating schedules for the Parent, the
Borrower and its consolidated Financial Subsidiaries in the case of this clause
(y), in a form reasonably satisfactory to the Administrative Agent;

 

71

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

(c) concurrently with any delivery of financial statements under clause (a) or
(b) above (commencing with the Fiscal Quarter ending February 28, 2013), a
certificate of a Financial Officer of the Borrower (i) certifying, in the case
of the financial statements and the consolidating schedules delivered under
clause (b), as presenting fairly in all material respects the financial
condition and results of operations of the Parent and its consolidated
subsidiaries on a consolidated basis and the Parent, the Borrower and its
consolidated Financial Subsidiaries on a consolidating basis, as applicable and
in each case, in accordance with GAAP consistently applied, subject to normal
year-end audit adjustments and the absence of footnotes, (ii) certifying as to
whether a Default has occurred and, if a Default has occurred, specifying the
details thereof and any action taken or proposed to be taken with respect
thereto, (iii) setting forth reasonably detailed calculations demonstrating
compliance with Sections 6.14, 6.15 and 6.16 and (iv) stating whether any change
in GAAP or in the application thereof has occurred since the date of the audited
financial statements referred to in Section 3.04 and to the extent not disclosed
in such financial statements, a brief statement of the effect of such change on
the financial statements accompanying such certificate;

(d) promptly after the sending or filing thereof, copies of all periodic and
other reports, proxy statements and other materials filed by the Parent, the
Borrower or any Subsidiary with the SEC, or any Governmental Authority
succeeding to the SEC, or with any national securities exchange, or distributed
by the Parent or the Borrower to its shareholders generally, as the case may be;

(e) promptly after Moody’s or S&P shall have announced a change in the rating
established or deemed to have been established for the Index Debt, written
notice of such rating change;

(f) as soon as available but in any event no later than 60 days after the
commencement of each Fiscal Year, a copy of the budget of the Parent and its
subsidiaries for each month of the upcoming Fiscal Year in form reasonably
satisfactory to the Administrative Agent; and

(g) promptly following any request therefor, such other information regarding
the operations, business affairs and financial condition of the Parent, the
Borrower or any Subsidiary (including Excluded Subsidiaries), or compliance with
the terms of any Credit Document, as the Administrative Agent or any Lender may
reasonably request.

SECTION 5.02. Notices of Material Events. The Borrower will furnish to the
Administrative Agent and each Lender prompt written notice of the following:

(a) the occurrence of any Default;

(b) within 15 days after the date on which the Borrower or any other Credit
Party becomes aware such event, the filing or commencement of any action, suit
or proceeding by or before any arbitrator or Governmental Authority against or
affecting any Credit Party or any Affiliate thereof that, if adversely
determined, could reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect;

(c) within 15 days after the date on which the Borrower or any other Credit
Party becomes aware such event, receipt of any notice of any governmental
investigation or any litigation or proceeding commenced or threatened against
any Credit Party that (i) is asserted or instituted against any Plan, its
fiduciaries or its assets, (ii) alleges criminal misconduct by any Credit Party,
or (iii) alleges the violation of any law regarding, or seeks remedies in
connection with, any Environmental Laws;

 

72

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

(d) the occurrence of any ERISA Event that, alone or together with any other
ERISA Events that have occurred or are reasonably expected to occur, could
reasonably be expected to result in liability of the Parent, the Borrower and
its Subsidiaries (including the Excluded Subsidiaries) in an aggregate amount
exceeding $500,000;

(e) contemporaneously with the filing or mailing thereof, any periodic or
special reports of a material nature filed with the FCC and relating to any
Station owned or operated by the Borrower or any of the Subsidiaries;

(f) the acquisition or creation of any new direct Foreign Subsidiary in
accordance with Section 5.13;

(g) any material change in a Credit Parties’ or a Subsidiary’s accounting
policies; and

(h) any other development that results in, or could reasonably be expected to
result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.

SECTION 5.03. Existence; Conduct of Business. Each Credit Party will, and will
cause each of its Subsidiaries to, do or cause to be done all things necessary
to preserve, renew and keep in full force and effect its legal existence and the
rights, licenses, permits, privileges and franchises material to the conduct of
its business; provided that the foregoing shall not prohibit any merger,
consolidation, liquidation or dissolution permitted under Section 6.03.
Notwithstanding anything to the contrary contained herein, each Credit Party
will, and will cause each of (i) its Subsidiaries (other than the License
Subsidiaries) to continue to engage primarily in the radio and television
broadcasting and/or magazine publishing businesses now conducted by each of them
and in related businesses, (ii) its License Subsidiaries to engage solely in the
business of holding the FCC Licenses necessary for the Operating Subsidiaries to
operate the Stations operated by each of them, and (iii) its Subsidiaries to,
continue to engage primarily in the businesses now conducted by them and in
related businesses, and in media or entertainment businesses or Telecom
Businesses and other businesses reasonably related thereto.

SECTION 5.04. Payment of Obligations. Each Credit Party will, and will cause
each of its Subsidiaries to, pay its obligations, including Tax liabilities,
that, if not paid, could result in a Material Adverse Effect before the same
shall become delinquent or in default, except where (a) the validity or amount
thereof is being contested in good faith by appropriate proceedings, (b) the
Borrower or such Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP and (c) the failure to make payment
pending such contest could not reasonably be expected to result in a Material
Adverse Effect.

 

73

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

SECTION 5.05. Maintenance of Properties; Insurance. Each Credit Party will, and
will cause each of its Subsidiaries to, (a) (i) keep and maintain all property
material to the conduct of its business in good working order and condition,
ordinary wear and tear and the abandonment of intellectual property no longer
material to the business excepted, (ii) make all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Borrower may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times, and
(iii) obtain, maintain, preserve, renew, extend and keep in full force and
effect all permits, rights, licenses, franchises, authorizations, patents,
trademarks, copyrights and privileges to the extent necessary for the proper
conduct of its business, including FCC Licenses; and (b) (i) maintain, with
financially sound and reputable insurance companies having a financial strength
rating of at least A- by A.M. Best Company, insurance in such amounts (with no
greater risk retention) and against such risks (including loss or damage by fire
and loss in transit, theft, burglary, pilferage, larceny, embezzlement, and
other criminal activities; business interruption; and general liability) and
such other hazards, as is customarily maintained by companies of established
repute engaged in the same or similar businesses operating in the same or
similar locations, (ii) pursuant to endorsements and/or assignments in form and
substance reasonably satisfactory to the Administrative Agent, (x) cause the
Administrative Agent to be named as lender’s loss payee in the case of casualty
insurance, and assignee in the case of all business interruption insurance, in
each case for the benefit of the Administrative Agent and Lenders and (y) cause
the Administrative Agent and each Lender to be named as additional insureds in
the case of all liability insurance, (iii) maintain all insurance required
pursuant to the Collateral Documents, and (iv) furnish to the Lenders, upon
request of the Administrative Agent, information in reasonable detail as to the
insurance so maintained.

SECTION 5.06. Books and Records; Inspection Rights. Each Credit Party will, and
will cause each of its Subsidiaries to, keep proper books of record and account
in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. Each Credit Party will,
and will cause each of its Subsidiaries to, permit any representatives
designated by the Administrative Agent or any Lender, upon reasonable prior
notice, to visit and inspect its properties, to examine and make extracts from
its books and records, and to discuss its affairs, finances and condition with
its officers and independent accountants, all at such reasonable times and as
often as reasonably requested; provided that excluding any such visits and
inspections during the continuation of an Event of Default, the Administrative
Agent and Lenders shall not exercise such visitation and inspection rights more
often than two (2) times during any calendar year.

SECTION 5.07. Compliance with Laws, Contracts, Licenses and Permits.

(a) Each Credit Party will, and will cause each of its Subsidiaries to, comply
with all laws, rules, regulations and orders of any Governmental Authority
applicable to it or its property (including, without limitation, all
Environmental Laws and the Communications Act), except where the failure to do
so, individually or in the aggregate, could not reasonably be expected to result
in a Material Adverse Effect. If any authorization, consent, approval, permit or
license from any officer, agency or instrumentality of any government shall
become necessary or required in order that the Borrower or any of its
Subsidiaries may fulfill any of its obligations hereunder or any of the other
Credit Documents to which the Borrower or such Subsidiary is a party, the
Borrower will, or (as the case may be) will cause such Subsidiary to,
immediately take or cause to be taken all reasonable steps within the power of
the Borrower or such Subsidiary to obtain such authorization, consent, approval,
permit or license and furnish the Administrative Agent and the Lenders with
evidence thereof.

 

74

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

(b) The Borrower will, and will cause each of its Subsidiaries to, (i) operate
its Stations, unless failure to comply could not individually or in the
aggregate reasonably be expected to cause a Material Adverse Effect, in
accordance with and in compliance with the Communications Act, (ii) file in a
timely manner all necessary applications for renewal of all FCC Licenses that
are Necessary Authorizations, (iii) use its reasonable best efforts to defend
any proceedings which could result in the termination, forfeiture or non-renewal
of any FCC License that is a Necessary Authorization, and (iv) promptly furnish
or cause to be furnished to the Administrative Agent: (A) a copy of any order or
notice of the FCC which designates any of the Borrower’s or any of its
Subsidiaries’ FCC Licenses that are Necessary Authorizations for a hearing or
which refuses renewal or extension thereof, or reverses or suspends its or any
of its Subsidiaries’ authority to operate a Station, (B) a copy of any competing
application filed with respect to any FCC Licenses that are Necessary
Authorizations, (C) a copy of any citation, notice of violation or order to show
cause issued by the FCC in relation to any of the Borrower’s or any of its
Subsidiaries’ Stations and (D) a copy of any notice or application by the
Borrower or any of its Subsidiaries requesting authority to cease broadcasting
on any Station or to cease operating any Station for any period in excess of
five (5) days.

SECTION 5.08. Use of Proceeds and Letters of Credit. The proceeds of the Loans
will be used only for working capital needs and other general corporate purposes
of the Borrower and its Subsidiaries, including for acquisitions (other than
Hostile Acquisitions), refinancing Indebtedness under the Existing Credit
Agreement and the Existing Note Purchase Agreement and other transactions
permitted hereby (it being understood and agreed that without the prior written
consent of the Administrative Agent, the Borrower may not utilize more than
$2,500,000 in the aggregate of proceeds of the Revolving Loans to redeem or
refinance the Parent Preferred Stock). No part of the proceeds of any Loan will
be used, and no portion of any Letter of Credit is to be obtained, whether
directly or indirectly, for any purpose that entails (a) a violation of any of
the Regulations of the Board, including Regulations T, U and X or (b) knowingly
purchasing, or providing credit support for the purchase of, during the
underwriting or placement period or within thirty (30) days thereafter, any
Ineligible Securities underwritten or privately placed by a Financial Affiliate.
Letters of Credit will be requested and utilized only in furtherance of the
general corporate purposes of the Borrower and its Subsidiaries and not to
support any transaction not permitted hereby.

SECTION 5.09. Interest Rate Protection. Within sixty (60) days after the
Effective Date, the Borrower shall enter into, and shall thereafter maintain,
interest rate protection for at least 50% of the aggregate Term Loan exposure
until the end of the first Loan Year; provided, that if the Senior Leverage
Ratio is above 2.50:1.00 at the end of the first Fiscal Quarter ending
immediately following the first Loan Year, then the Borrower shall maintain
interest rate protection for at least 50% of the aggregate then outstanding Term
Loan exposure until the end of the second Loan Year. Such interest rate
protection shall be on terms and conditions and in a manner satisfactory to the
Administrative Agent.

 

75

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

SECTION 5.10. Casualty and Condemnation. Each Credit Party will (a) furnish to
the Administrative Agent and the Lenders prompt written notice of any casualty
or other insured damage to any material portion of the Collateral or the
commencement of any action or proceeding for the taking of any material portion
of the Collateral in excess of $1,000,000 or interest therein under power of
eminent domain or by condemnation or similar proceeding, within 15 days after
the date on which the Borrower or any other Credit Party becomes aware such
action or proceeding and (b) ensure that the Net Available Proceeds of any such
event (whether in the form of insurance proceeds, condemnation awards or
otherwise) are collected and applied in accordance with the applicable
provisions of this Agreement and the Collateral Documents.

SECTION 5.11. [Intentionally Omitted].

SECTION 5.12. Depository Banks. The Borrower and each Subsidiary will maintain
the Administrative Agent or any Lender as its principal depository bank,
including for the maintenance of operating, administrative, cash management,
collection activity, and other deposit accounts for the conduct of its business,
so long as the costs of such services are commercially reasonable and customary.

SECTION 5.13. Additional Guarantors and Collateral; Further Assurances.
(a) Subject to applicable law, the Parent, the Borrower and each Subsidiary that
is a Credit Party will cause (i) each of its Domestic Subsidiaries (other than
any CFC Holding Companies) formed or acquired after the date of this Agreement
in accordance with the terms of this Agreement, (ii) RAM and/or the Austin
Partnership, in the event that the Borrower purchases the remaining Equity
Interests of RAM and/or the Austin Partnership, or (iii) each of Emmis
Meadowlands Corporation, Emmis Television Broadcasting, L.P., Emmis Television
License LLC, KMVN, LLC, and/or KMVN License LLC, in the event that such Person
is not dissolved within six months after the Effective Date, in each case, to
become a Credit Party by executing a Guaranty (or a joinder thereto). Upon
execution and delivery thereof, each such Person shall grant Liens to the
Administrative Agent, for the benefit of the Administrative Agent and the
Lenders and the other holders of the Secured Obligations, in any property of
such Credit Party which constitutes Collateral, including any parcel of real
property located in the U.S. owned by any Credit Party.

(b) The Parent, the Borrower and each Subsidiary that is a Credit Party will
cause (A) each such Person (other than the Borrower) to execute and deliver to
the Administrative Agent a Parent Guaranty or Subsidiary Guaranty, as
applicable, and (B) (i) 100% of the issued and outstanding Equity Interests of
each of its Domestic Subsidiaries (including, without limitation, all License
Subsidiaries) (other than any CFC Holding Companies), (ii) all outstanding
Equity Interests owned by a Credit Party in each of RAM and the Austin
Partnership, (iii) 65% of the issued and outstanding Equity Interests entitled
to vote (within the meaning of Treas. Reg. Section 1.956-2(c)(2)) and 100% of
the issued and outstanding Equity Interests not entitled to vote (within the
meaning of Treas. Reg. Section 1.956-2(c)(2)) in each Foreign Subsidiary (and
each CFC Holding Company) directly owned by the Borrower or any Domestic
Subsidiary, (iv) the Emmis Chief Executive Office and (v) all other Collateral,
in each case, to be subject at all times to a first priority, perfected Lien in
favor of the Administrative Agent pursuant to the terms and conditions of the
Credit Documents or other security documents as the Administrative Agent shall
reasonably request. With respect to FCC Licenses held by the

 

76

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

Borrower or any of its Subsidiaries, to the extent Borrower has not already done
so, the Borrower shall form (or cause to be formed) (and at all times maintain)
separate “license subsidiaries” that hold as its only asset a FCC License or FCC
Licenses and the stock or limited liability company interests of each such
licensed subsidiary shall be pledged to the Administrative Agent in accordance
with this clause (b) and the Pledge Agreement. In addition, all FCC Licenses of
the Credit Parties and their Subsidiaries, now or hereafter acquired, shall be
held by one or more License Subsidiaries. Borrower shall cause each License
Subsidiary to (i) observe all customary corporate, company or partnership
formalities regarding its legal existence, (ii) not commingle its properties
with those of its Affiliates or any other Person, (iii) accurately maintain its
own bank accounts and separate books and records in accordance with GAAP,
(iv) pay its own liabilities from its own separate assets, (v) not make loans to
or assume or guaranty the obligations of any Person (other than pursuant to the
Credit Documents or otherwise permitted hereunder) and (vi) otherwise be
operated in such a manner that the separate legal existence of such License
Subsidiary will not be disregarded in any insolvency or other legal proceeding.

(c) Without limiting the foregoing, each Credit Party will, and will cause each
Subsidiary to, execute and deliver, or cause to be executed and delivered, to
the Administrative Agent such documents, agreements and instruments, and will
take or cause to be taken such further actions (including the filing and
recording of financing statements, fixture filings, mortgages, deeds of trust
and other documents and such other actions or deliveries of the type required by
Section 4.01, as applicable), which may be required by law or which the
Administrative Agent may, from time to time, reasonably request to carry out the
terms and conditions of this Agreement and the other Credit Documents and to
ensure perfection and first-priority of the Liens created or intended to be
created by the Collateral Documents, all at the expense of the Credit Parties.

(d) If any material assets (including any owned real property or improvements
thereto or any interest therein) are acquired by the Borrower or any Subsidiary
that is a Credit Party after the Effective Date (other than assets constituting
Collateral under the Security Agreement that become subject to the Lien in favor
of the Security Agreement upon acquisition thereof), the Borrower will
(i) notify the Administrative Agent and the Lenders thereof and, if requested by
the Administrative Agent or the Required Lenders, cause such assets to be
subjected to a Lien securing the Secured Obligations and (ii) take, and cause
each Subsidiary that is a Credit Party to take, such actions as shall be
necessary or reasonably requested by the Administrative Agent to grant and
perfect such Liens, including actions described in paragraph (c) of this
Section, all at the expense of the Credit Parties.

(e) Each of the Credit Parties shall use reasonable best efforts to cause to be
delivered to the Administrative Agent no later than 30 days after the Effective
Date a Collateral Access Agreement from each landlord which leases real property
(and the accompanying facilities) with respect to tower and/or Station sites in
the cities of New York, Los Angeles and St. Louis to any of the Credit Parties
as of the Effective Date. Such 30 day period may be extended or such requirement
may be waived in the sole discretion of the Administrative Agent. If any Credit
Party shall lease any real property or facilities with respect to tower and/or
Station sites after the Effective Date, such Credit Party shall use reasonable
best efforts to cause the landlord in respect of such leased property or
facilities to sign a Collateral Access Agreement. Such requirement may be waived
in the sole discretion of the Administrative Agent. It is understood and agreed
that “reasonable best efforts” as used in this clause (e) shall not in any case
include the making of any payment or agreeing to any adverse lease modifications
with respect thereto.

 

77

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

ARTICLE VI

Negative Covenants

Until the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees payable hereunder have been paid in full and
all Letters of Credit shall have expired or terminated, in each case, without
any pending draw, and all LC Disbursements shall have been reimbursed, the
Parent, the Borrower and each other Credit Party covenants and agrees with the
Lenders that:

SECTION 6.01. Indebtedness. The Credit Parties will not, and will not permit any
Subsidiary to, create, incur, assume or permit to exist any Indebtedness,
except:

(a) Indebtedness created hereunder;

(b) Indebtedness existing on the date hereof and set forth in Schedule
6.01, including any Permitted Refinancing thereof;

(c) Indebtedness of any Credit Party to any Subsidiary and of any Subsidiary to
the Borrower or any other Subsidiary, provided that (i) Indebtedness owing to
the Credit Parties by any Subsidiary that is not a Subsidiary Guarantor shall be
permitted only to the extent allowed by Section 6.04 and (ii) Indebtedness of
any Credit Party owing to any Subsidiary that is not a Subsidiary Guarantor
shall be subordinated to the Obligations on terms satisfactory to the
Administrative Agent;

(d) Guarantees by the Borrower or any Subsidiary of the Indebtedness of any such
Person provided, that any Guarantee by a Credit Party of the Indebtedness of a
Subsidiary that is not a Subsidiary Guarantor shall be permitted only to the
extent allowed by Section 6.04;

(e) Indebtedness of any Credit Party or any Subsidiary incurred to finance the
acquisition, construction or improvement of any fixed or capital assets,
including Capital Lease Obligations and any Indebtedness assumed in connection
with the acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof, and extensions, renewals and replacements of
any such Indebtedness that do not increase the outstanding principal amount
thereof; provided that (i) such Indebtedness is incurred prior to or within 90
days after such acquisition or the completion of such construction or
improvement and (ii) the aggregate principal amount of Indebtedness permitted by
this clause (e) shall not exceed $2,500,000 at any time outstanding;

(f) Indebtedness of any Credit Party or any Subsidiary as an account party in
respect of trade letters of credit;

(g) [Intentionally Omitted]; and

 

78

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

(h) Indebtedness incurred by the Parent or Subordinated Indebtedness incurred by
the Borrower, including any Permitted Refinancing thereof, so long as upon each
incurrence of such Indebtedness or Subordinated Indebtedness (i) no Default or
Event of Default exists or would result therefrom, (ii) immediately prior to and
after giving effect to such incurrence of Indebtedness or Subordinated
Indebtedness, the Total Leverage Ratio calculated on a pro forma basis is not
greater than 4.75:1.00, and (iii) all such Indebtedness or Subordinated
Indebtedness incurred pursuant to this clause (h) does not exceed $20,000,000 in
the aggregate.

SECTION 6.02. Liens. Credit Parties will not, and will not permit any Subsidiary
to, create, incur, assume or permit to exist any Lien on any property or asset
now owned or hereafter acquired by it, or assign or sell any income or revenues
(including accounts receivable) or rights in respect of any thereof, except:

(a) Permitted Encumbrances;

(b) any Lien on any property or asset of any Credit Party or any Subsidiary
existing on the date hereof and set forth in Schedule 6.02; provided that
(i) such Lien shall not apply to any other property or asset of any Credit Party
or any Subsidiary and (ii) such Lien shall secure only those obligations which
it secures on the date hereof and extensions, renewals and replacements thereof
that do not increase the outstanding principal amount thereof;

(c) Liens on fixed or capital assets acquired, constructed or improved by any
Credit Party or any Subsidiary; provided that (i) such security interests secure
Indebtedness permitted by clause (e) of Section 6.01, (ii) such security
interests and the Indebtedness secured thereby are incurred prior to or within
90 days after such acquisition or the completion of such construction or
improvement, (iii) the Indebtedness secured thereby does not exceed 100% of the
cost of acquiring, constructing or improving such fixed or capital assets and
(iv) such security interests shall not apply to any other property or assets of
any Credit Party or any Subsidiary; and

(d) other Liens at no time exceeding $1,000,000 in aggregate outstanding
principal amount.

SECTION 6.03. Fundamental Changes; Sale of Assets.

(a) The Parent and the Borrower will not, and will not permit any Subsidiary,
the Austin Partnership or RAM to, merge into or consolidate with any other
Person, or permit any other Person to merge into or consolidate with it, or
liquidate or dissolve, except that, if at the time thereof and immediately after
giving effect thereto no Default shall have occurred and be continuing (i) any
Person may merge into the Borrower in a transaction in which the Borrower is the
surviving corporation, (ii) any Person may merge into any Subsidiary in a
transaction in which the surviving entity is a Subsidiary (and, if either such
Subsidiary is a Guarantor, then the surviving entity shall also be a Guarantor)
and (iii) any Subsidiary may liquidate or dissolve if the Borrower determines in
good faith that such liquidation or dissolution is in the best interests of the
Borrower and is not materially disadvantageous to the Lenders; provided that any
such merger involving a Person that is not a Wholly-Owned Subsidiary immediately
prior to such merger shall not be permitted unless also permitted by
Section 6.03(c) or Section 6.04 below.

 

79

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

(b) The Credit Parties will not, and will not permit any Subsidiary, the Austin
Partnership or RAM to, engage to any material extent in any business other than
(i) businesses of the type conducted by such Credit Party and such subsidiary on
the date of execution of this Agreement and businesses reasonably related
thereto, and (ii) media or entertainment business or Telecom Business and other
businesses reasonably related thereto.

(c) The Credit Parties will not, nor will they permit any Subsidiary, the Austin
Partnership or RAM to, make any Asset Disposition or Asset Swap except for:

(i) Asset Dispositions among the Borrower and its Subsidiaries (upon voluntary
liquidation or otherwise); provided that any Asset Dispositions by a Credit
Party to a Subsidiary that is not a Credit Party shall only be permitted if such
Asset Disposition is approved in writing by the Administrative Agent and
Required Lenders in their sole discretion;

(ii) Asset Dispositions expressly permitted by Sections 6.04, 6.07 or 6.08; and

(iii) other than Asset Dispositions described in Section 6.03(c)(iv), other
Asset Dispositions of property (not including FCC Licenses, Stations or any
Equity Interests of any License Subsidiary) that, together with all other
property of the Borrower and its Subsidiaries previously leased, sold or
disposed of in Asset Dispositions made pursuant to this Section 6.03(c)(iii)
during the twelve-month period ending with the month in which any such lease,
sale or other disposition occurs, do not constitute a Substantial Portion of the
property of the Borrower and its Subsidiaries; and

(iv) Asset Dispositions and Asset Swaps not described in sub-clauses
(i)-(iii) above, provided that in the case of each such Asset Disposition or
Asset Swap, (A) no Default or Event of Default has occurred and is continuing or
would result on a pro forma basis from such Asset Disposition or Asset Swap,
(B) is for fair market value (with respect to Stations, the fair market value
shall equal an amount not less than the value for each such Stations set forth
on Schedule 6.03(c)), (C) in the case of an Asset Disposition, at least 75% of
the consideration received by the applicable Credit Party or Subsidiary in
connection therewith is in the form of cash and is received upon consummation of
such Asset Disposition, (D) each such Asset Disposition or Asset Sale is
consummated on an arm’s length basis for fair consideration with a non-Affiliate
of such Credit Party or Subsidiary, (E) in the case of an Asset Swap, and to
extent applicable, the applicable Credit Party or such Subsidiary shall have
complied with the provisions in Section 5.13 with respect to the assets acquired
(including, without limitation, Equity Interests and FCC Licenses) in such Asset
Swap, (F) the Borrower shall have delivered to the Administrative Agent updated
Schedules 3.05(a), (c), (d) and/or 3.16, as applicable, after giving effect to
such Asset Disposition or Asset Swap and (G) all Net Available Proceeds realized
upon such Asset Disposition or Asset Swap shall be applied to prepay the Loans
in accordance with Section 2.11(c)(i).

 

80

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

SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions. The
Credit Parties will not, and will not permit any Subsidiary to, purchase, hold
or acquire (including pursuant to any merger with any Person that was not a
Wholly-Owned Subsidiary prior to such merger) any capital stock, evidences of
indebtedness or other securities (including any option, warrant or other right
to acquire any of the foregoing) of, make or permit to exist any loans or
advances to, Guarantee any obligations of, or make or permit to exist any
investment or any other interest in, any other Person, or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any other
Person constituting a business unit (each of the foregoing being an
“Investment”), or enter into any LMA Agreement, except:

(a) Permitted Investments;

(b) Investments by a Credit Party or a Subsidiary existing on the date hereof
and set forth on Schedule 6.04(b);

(c) Investments by a Credit Party in any other Credit Party or by a Subsidiary
which is not a Credit Party in a Credit Party or another such Subsidiary;

(d) loans or advances made by any Credit Party to any other Credit Party;
provided that any such loans and advances shall be evidenced by a promissory
note pledged pursuant to the Security Agreement;

(e) Guarantees constituting Indebtedness permitted by Section 6.01;

(f) the Borrower and its Wholly-Owned Subsidiaries may from time to time effect
Acquisitions (i) with the prior written consent of the Administrative Agent (not
to be unreasonably withheld or delayed), so long as the proposed Acquisition is
for aggregate consideration (including the assumption of Indebtedness) of
$10,000,000 or less, or (ii) with the prior written consent of the
Administrative Agent and the Required Lenders, if the proposed Acquisition is
for aggregate consideration (including the assumption of Indebtedness) of more
than $10,000,000;

(g) Investments in CourseLoad in an amount not to exceed $6,000,000 in the
aggregate;

(h) other Investments made so long as (i) no Default or Event of Default exists
or would result therefrom, (ii) the Senior Leverage Ratio is, immediately prior
and after giving effect to such Investment, calculated on a pro forma basis,
less than or equal to 2.50 to 1.00 and (iii) the Total Leverage Ratio is,
immediately prior and after giving effect to such Investment, calculated on a
pro forma basis, less than or equal to 3.00 to 1.00;

(i) other Investments so long as the aggregate amount of all such Investments
made pursuant to this Section 6.04(i) (net of the principal amount of repayments
of loans and the termination or reduction of Guarantees (other than as a result
of payments by the guarantor)) shall at no time exceed $5,000,000 at any time
outstanding;

 

81

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

(j) without the prior written consent of the Required Lenders, a Credit Party,
the Austin Partnership or RAM shall not enter into any LMA Agreement under which
any television or radio station owned or operated by one or more of the Credit
Parties, the Austin Partnership or RAM is the brokered station (i.e., the
station whose time is sold or the station which receives, rather than provides,
programming, management, technical or other services under such LMA Agreement)
except in the case where (i) such LMA Agreement is entered into in connection
with an Asset Disposition of the same Station otherwise permitted hereunder,
(ii) such Asset Disposition is subject to an executed purchase or sale agreement
(a copy of which shall be provided to the Administrative Agent promptly after
execution thereof) and (iii) such Asset Disposition is reasonably expected to be
completed within 120 days of the date of such purchase or sale agreement;
provided, that such written consent shall not be required for a Credit Party,
the Austin Partnership or RAM to enter into a LMA Agreement under which such
Credit Party, the Austin Partnership or RAM acts as the broker, provides
programming, sells time on or provides management, technical or other services
to a television or radio station not owned by any Credit Party, the Austin
Partnership or RAM;

(k) Investments in non-cash consideration received in connection with Asset
Swaps and Asset Dispositions otherwise permitted hereunder so long as the other
requirements with respect to such Asset Swap or Asset Disposition under this
Agreement have been met;

(l) Acquisitions listed on Schedule 6.04(l) hereto; and

(m) Investments in Excluded Subsidiaries not to exceed $2,500,000 at any time
outstanding.

SECTION 6.05. Swap Agreements. Each Credit Party will not, and will not permit
any of its Subsidiaries to, enter into any Swap Agreement, except (a) Swap
Agreements entered into to hedge or mitigate risks to which the Parent, the
Borrower or any Subsidiary has actual exposure (other than those in respect of
Equity Interests of the Parent, the Borrower or any of its Subsidiaries), and
(b) Swap Agreements entered into in order to effectively cap, collar or exchange
interest rates (from fixed to floating rates, from one floating rate to another
floating rate or otherwise) with respect to any interest-bearing liability or
investment of the Parent, the Borrower or any Subsidiary.

SECTION 6.06. Sale and Leaseback Transactions. The Borrower will not, and will
not permit any of its Subsidiaries to, enter into any arrangement, directly or
indirectly, whereby the Borrower or any Subsidiary of the Borrower shall sell or
transfer any property or Station or any significant portion of the property,
assets and ownership rights used in connection with the operation of a Station
owned by it in order then or thereafter to lease such property or Station (or
associated rights or assets) or lease other property that the Borrower or any
Subsidiary of the Borrower intends to use for substantially the same purpose as
the property being sold or transferred or in order to then or thereafter enter
into a LMA Agreement (or a similar agreement regardless of whether such
agreement is with a non-Affiliate or an Affiliate) directly or indirectly
relating to such property or the Station operated in connection with such
property unless approved in writing by the Administrative Agent in its sole
reasonable discretion and the Credit Parties would be in compliance with
Sections 6.01, 6.02 and 6.03(c) after giving effect to any such transaction or
arrangement described in this Section 6.06.

 

82

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

SECTION 6.07. Restricted Payments; Certain Payments of Indebtedness.

(a) The Borrower will not, and will not permit any of its Subsidiaries to,
declare, pay or make, or agree to declare, pay or make, directly or indirectly,
any Restricted Payment, except:

(i) the Borrower may declare and pay dividends with respect to its Equity
Interests payable solely in additional shares of its common stock;

(ii) Subsidiaries may declare and pay dividends ratably with respect to their
Equity Interests;

(iii) the Borrower may make Restricted Payments pursuant to and in accordance
with stock option plans or other benefit plans for directors, officers,
employees or independent contractors of the Borrower and its Subsidiaries
(including tax withholding payments in connection with such plans or
arrangements);

(iv) other Restricted Payments made so long as (w) no Default or Event of
Default exists or would result therefrom, (x) the Senior Leverage Ratio is,
immediately prior and after giving effect to such Restricted Payment, calculated
on a pro forma basis, less than or equal to 2.50 to 1.00 and (y) the Total
Leverage Ratio is, immediately prior and after giving effect to such Restricted
Payment, calculated on a pro forma basis, less than or equal to 3.00 to 1.00;

(v) the Borrower may make payments in connection with Corporate Overhead;

(vi) so long as the Borrower is a member (but not the parent) of a consolidated,
combined, unitary or similar group for federal, state or local income tax
purposes, the Borrower may pay cash dividends to Parent, the proceeds of which
will be used by Parent solely to pay such consolidated, combined, unitary or
similar federal, state or local income taxes, in an amount not to exceed the
lesser of (x) the actual income tax liability of such consolidated, combined,
unitary or similar group (net of allowable tax credits) and (y) the income tax
liability that would have been payable by the Borrower and its Subsidiaries on a
stand-alone basis if the Borrower was the parent of such consolidated, combined,
unitary or similar group and had filed such return on a stand-alone basis,
taking into account on such hypothetical return, prior year losses and other tax
attributes generated by the Borrower and its Subsidiaries that would be
available on such return (ignoring the ability to carryback losses or tax
attributes); provided that the amount otherwise calculated pursuant to this
provision shall be reduced by any such income taxes paid or to be paid directly
by Borrower or any of its Subsidiary thereof; and

(vii) in connection with any Subordinated Indebtedness issued by the Borrower in
compliance with Section 6.01(h) or as otherwise permitted by Section 5.08, the
Borrower may make Restricted Payments to the Parent for the purpose of redeeming
the Parent Preferred Stock.

 

83

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

(b) The Credit Parties will not, and will not permit any of its Subsidiaries to,
make or agree to pay or make, directly or indirectly, any payment or other
distribution (whether in cash, securities or other property) of or in respect of
principal of or interest on any Indebtedness, or any payment or other
distribution (whether in cash, securities or other property), including any
sinking fund or similar deposit, on account of the purchase, redemption,
retirement, acquisition, cancellation or termination of any Indebtedness,
except:

(i) payment of Indebtedness created under the Credit Documents;

(ii) payment of regularly scheduled interest and principal payments as and when
due in respect of any Indebtedness, other than payments in respect of the
Subordinated Indebtedness prohibited by the subordination provisions thereof;

(iii) refinancings of Indebtedness to the extent permitted by Section 6.01; and

(iv) payment of secured Indebtedness that becomes due as a result of the
voluntary sale or transfer of the property or assets securing such Indebtedness.

SECTION 6.08. Transactions with Affiliates. The Credit Parties will not, and
will not permit any of its Subsidiaries (including, for purposes of this
Section 6.08, without limitation, the Excluded Subsidiaries) to, sell, lease or
otherwise transfer any property or assets to, or purchase, lease or otherwise
acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, and the Parent will not engage in any
transaction with any Excluded Subsidiary, in each case, except (a) transactions
between any Credit Party and an Affiliate that is a Credit Party;
(b) transactions between any Credit Party and an Affiliate that is not a Credit
Party (i) in the ordinary course of business at prices and on terms and
conditions not less favorable to the Credit Party than could be obtained on an
arm’s-length basis from unrelated third parties or (ii) constituting Investments
in Subsidiaries otherwise permitted under Section 6.04 or Investments in
Excluded Subsidiaries otherwise permitted under Section 6.04(m);
(c) transactions between any Affiliate that is not a Credit Party and another
Affiliate that is not a Credit Party, provided that if any such Affiliate is a
Financial Subsidiary, such transactions shall be in the ordinary course of
business at prices and on terms and conditions not less favorable to the Credit
Party than could be obtained on an arm’s-length basis from unrelated third
parties; (d) transactions listed on Schedule 6.08 and (e) ordinary course
executive compensation arrangements consistent with past practices. In addition
to and without limiting the foregoing, the Borrower will not, and will not
permit any of its Subsidiaries to, (x) transfer any portion of the operations of
the Borrower or its Subsidiaries (whether related to general overhead functions
and expenses or operating activities at, or expenses of, any Station or
Magazine, or any significant portion of the property, assets and ownership
rights used in connection with the operation of a Station or Magazine),
(y) outsource any services required in connection with the operation of any such
Station or Magazine, or any significant portion of the property, assets and
ownership rights used in connection with the operation of a Station or Magazine
owned by it, or (z) engage in any other activity or enter into any other
arrangement in connection with such Station or Magazine, or any significant
portion of the property, assets and ownership rights used in connection with the
operation of such Station or Magazine owned by it, in each of clauses (x),
(y) and (z), with or to any Excluded Subsidiary, any Affiliate of the Borrower
or any of its Subsidiaries or any other Person in whom the Borrower or any of
its Subsidiaries has an Investment if in any such case the effect would be to
increase the Borrower’s Consolidated EBITDA for any period to an amount in
excess of what the Borrower’s Consolidated EBITDA would have been in the absence
of such activity or arrangement.

 

84

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

SECTION 6.09. Restrictive Agreements. The Credit Parties will not, and will not
permit any of its Subsidiaries to, directly or indirectly, enter into, incur or
permit to exist any agreement or other arrangement that prohibits, restricts or
imposes any condition upon (a) the ability of any Credit Party or any Subsidiary
to create, incur or permit to exist any Lien upon any of its property or assets,
or (b) the ability of any Subsidiary to pay dividends or other distributions
with respect to any shares of its capital stock or to make or repay loans or
advances to any Credit Party or any other Subsidiary or to Guarantee
Indebtedness of the Credit Parties or any other Subsidiary; provided that
(i) the foregoing shall not apply to restrictions and conditions imposed by law
or by the Credit Documents, (ii) the foregoing shall not apply to restrictions
and conditions existing on the date hereof identified on Schedule 6.09 (but
shall apply to any extension or renewal of, or any amendment or modification
expanding the scope of, any such restriction or condition), (iii) the foregoing
shall not apply to customary restrictions and conditions contained in agreements
relating to the sale of a Subsidiary pending such sale, provided such
restrictions and conditions apply only to the Subsidiary that is to be sold and
such sale is permitted hereunder, (iv) clause (a) of the foregoing shall not
apply to restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness and (v) clause
(a) of the foregoing shall not apply to customary provisions in leases and other
contracts restricting the assignment thereof.

SECTION 6.10. Amendment of Material Documents. No Credit Party will, nor will it
permit any Subsidiary to, amend, modify or waive any of its rights under (a) any
agreement relating to any Subordinated Indebtedness or (b) its certificate of
incorporation, by-laws, operating, management or partnership agreement or other
organizational documents.

SECTION 6.11. Excluded Subsidiaries.

(a) The Borrower will not permit any of its Excluded Subsidiaries to (a) fail to
satisfy customary formalities with respect to organization separateness,
including (i) the maintenance of separate books and records and (ii) the
maintenance of separate bank accounts in its own name, (b) fail to act solely in
its own name and through its authorized officers and agents, (c) commingle any
money or other assets of any Excluded Subsidiary with any money or other assets
of the Borrower or any other Subsidiary of the Borrower, or (d) take any action,
or conduct its affairs in a manner, which could reasonably be expected to result
in the separate organizational existence of the Excluded Subsidiaries being
ignored under any circumstance.

(b) The Parent and the Borrower will not permit any of the Excluded Subsidiaries
to, (a) enter into or permit to exist any arrangement or agreement (other than
this Agreement and the other Credit Documents) which directly or indirectly
prohibits any such Excluded Subsidiary from creating, assuming or incurring any
Lien upon its properties, revenues or assets or those of any of its subsidiaries
whether now owned or hereafter acquired to secure the Obligations (other than
restrictions on specific assets, which assets are the subject of purchase money
security interests), or (b) enter into any agreement, contract or arrangement
(other than this Agreement and the other Credit Documents) restricting the
ability of any such Excluded Subsidiary to pay or make dividends or
distributions in cash or kind to the Borrower or any other Subsidiary or
Excluded Subsidiary, to make loans, advances or other payments of any nature to
the Borrower or any other Subsidiary or Excluded Subsidiary, or to make
transfers or distributions of all or any part of its assets to the Borrower or
any other Subsidiary or Excluded Subsidiary; in each case other than
(i) restrictions on specific assets which assets are the subject of purchase
money security interests, (ii) customary anti-assignment provisions contained in
leases and licensing agreements entered into by any Excluded Subsidiary in the
ordinary course of its business and (iii) property subject to a pending Asset
Disposition.

 

85

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

SECTION 6.12. Parent Covenant. The Parent shall not (i)(x) perform any services
or activities, or make any cash payments for the performance of any services or
activities, other than those services and activities described in the definition
of “Corporate Overhead” or reasonably related thereto, or (y) perform any
services or activities, or make any cash payments for the performance of any
services or activities that are ordinarily performed or paid for by an operating
company, (ii) engage in any trade or business, (iii) own any assets,
(iv) directly or indirectly, beneficially or otherwise, hold or own (whether
pursuant to an Asset Swap or otherwise) any Capital Stock or other securities of
any Person, (v) issue or incur any Indebtedness or (vi) effect any Equity
Issuances, except that the Parent may:

(a) hold and own the capital stock of itself, the Borrower and, indirectly, any
other Person that is either a Subsidiary of the Borrower or an Excluded
Subsidiary which is a subsidiary of the Borrower,

(b) make Investments described under Sections 6.04(c) or (d) hereof, and make
Investments permitted under Section 6.04 hereof which are held by the Borrower
or any of its Subsidiaries but only to the extent the Borrower and its
Subsidiaries are permitted to make such Investment,

(c) incur Indebtedness in respect of the Obligations and Indebtedness that
Parent is permitted to incur under Section 6.01 hereof so long as any such
Indebtedness continues to be permitted under Section 6.01 hereof at all times
after the incurrence thereof,

(d) issue any capital stock or other Equity-Like Instruments if otherwise
permitted hereunder, and

(e) administer benefit plans for employees and independent contractors of the
Borrower and its Subsidiaries and directors of the Parent.

SECTION 6.13. Fiscal Year. The Borrower will not, and will not permit any of its
Subsidiaries to, change the date of the end of its Fiscal Year to end on any
date other than February 28, or in the case of a leap year, February 29, of each
year.

SECTION 6.14. Minimum Fixed Charge Coverage Ratio. The Borrower will not permit
the Fixed Charge Coverage Ratio as of the last day of any Fiscal Quarter to be
less than or equal to 1.25 to 1.00.

 

86

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

SECTION 6.15. Maximum Senior Leverage Ratio. The Borrower will cause the Senior
Leverage Ratio as of the last day of any Fiscal Quarter to be less than or equal
to the applicable ratio set forth below for such Fiscal Quarter:

 

Fiscal Quarter Ending

   Ratio  

February 28, 2013

     4.00:1.00   

May 31, 2013

     4.00:1.00   

August 31, 2013

     4.00:1.00   

November 30, 2013

     3.50:1.00   

February 28, 2014

     3.25:1.00   

May 31, 2014

     3.25:1.00   

August 31, 2014

     3.00:1.00   

November 30, 2014

     3.00:1.00   

February 28, 2015 and at the end of each Fiscal Quarter thereafter

     2.75:1.00   

SECTION 6.16. Maximum Total Leverage Ratio. The Borrower will cause the Total
Leverage Ratio as of the last day of any Fiscal Quarter to be less than or equal
to the applicable ratio set forth below for such Fiscal Quarter:

 

Fiscal Quarter Ending

   Ratio  

February 28, 2013

     4.75:1.00   

May 31, 2013

     4.75:1.00   

August 31, 2013

     4.75:1.00   

November 30, 2013 and at the end of each Fiscal Quarter thereafter

     4.00:1.00   

ARTICLE VII

Events of Default

If any of the following events (“Events of Default”) shall occur:

(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement or fail to deposit
any cash collateral amount due pursuant to Section 2.06(j) when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise;

 

87

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

(b) the Borrower shall fail to pay any interest on any Loan or any fee or any
other amount (other than an amount referred to in clause (a) of this Article)
payable under the Credit Documents, when and as the same shall become due and
payable;

(c) any representation or warranty made or deemed made by or on behalf of any
Credit Party or any Subsidiary in or in connection with this Agreement or any
other Credit Document or any amendment or modification hereof or thereof or
waiver hereunder or thereunder, or in any report, certificate, financial
statement or other document furnished pursuant to or in connection with this
Agreement or any other Credit Document or any amendment or modification hereof
or thereof or waiver hereunder or thereunder, shall prove to have been incorrect
in any material respect when made or deemed made;

(d) the Borrower shall fail to observe or perform any covenant, condition or
agreement contained in Section 5.02, 5.03, 5.05, 5.08, 5.09, or 5.13 or in
Article VI;

(e) any Credit Party shall fail to observe or perform any other covenant,
condition or agreement contained in the Credit Documents that such Credit Party
is required to observe or perform (other than those specified in clause (a),
(b), (d) or (n) of this Article), and such failure shall continue unremedied for
a period of 30 days after notice thereof from the Administrative Agent to the
Borrower (which notice will be given at the request of any Lender);

(f) any Credit Party, any Subsidiary, the Austin Partnership or RAM shall fail
to make any payment (whether of principal or interest and regardless of amount)
in respect of any Material Indebtedness, when and as the same shall become due
and payable;

(g) any event or condition occurs that results in any Material Indebtedness of
any Credit Party, any Subsidiary, the Austin Partnership or RAM becoming due
prior to its scheduled maturity or that enables or permits (with or without the
giving of notice, the lapse of time or both) the holder or holders of any such
Material Indebtedness or any trustee or agent on its or their behalf to cause
any such Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled maturity;
provided that this clause (g) shall not apply to secured Indebtedness that
becomes due as a result of the voluntary sale or transfer of the property or
assets securing such Indebtedness;

(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed seeking (i) liquidation, winding up, administration,
reorganization or other relief in respect of any Credit Party, any Subsidiary,
the Austin Partnership or RAM, or its debts, or of a substantial part of its
assets, under any Federal, state or foreign bankruptcy, insolvency, receivership
or similar law now or hereafter in effect or (ii) the appointment of a
liquidator, receiver, trustee, custodian, sequestrator, conservator,
administrator, or similar official for any Credit Party, any Subsidiary, the
Austin Partnership or RAM for a substantial part of its assets, and, in any such
case, such proceeding or petition shall continue undismissed for 60 days or an
order or decree approving or ordering any of the foregoing shall be entered;

 

88

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

(i) any Credit Party, any Subsidiary, the Austin Partnership or RAM shall
(i) voluntarily commence any proceeding or file any petition seeking
liquidation, winding up, administration, reorganization or other relief under
any Federal, state or foreign bankruptcy, insolvency, receivership or similar
law now or hereafter in effect, (ii) consent to the institution of, or fail to
contest in a timely and appropriate manner, any proceeding or petition described
in clause (h) of this Article, (iii) apply for or consent to the appointment of
a liquidator, receiver, trustee, custodian, sequestrator, conservator,
administrator or similar official for any Credit Party, any Subsidiary, the
Austin Partnership or RAM or for a substantial part of its assets, (iv) file an
answer admitting the material allegations of a petition filed against it in any
such proceeding, (v) make a general assignment for the benefit of creditors or
(vi) take any action for the purpose of effecting any of the foregoing;

(j) any Credit Party, any Subsidiary, the Austin Partnership or RAM shall become
unable, admit in writing its inability or fail generally to pay its debts as
they become due;

(k) one or more judgments for the payment of money in an aggregate amount in
excess of $5,000,000 shall be rendered against any Credit Party, any Subsidiary,
the Austin Partnership or RAM or any combination thereof and the same shall
remain undischarged for a period of 30 consecutive days during which execution
shall not be effectively stayed, or any action shall be legally taken by a
judgment creditor to attach or levy upon any assets of any Credit Party, any
Subsidiary, the Austin Partnership or RAM to enforce any such judgment;

(l) an ERISA Event shall have occurred that, in the opinion of the Required
Lenders, when taken together with all other ERISA Events that have occurred or
are reasonably expected to occur, could reasonably be expected to result in
liability of the Parent, the Borrower and its Subsidiaries (including the
Excluded Subsidiaries) in an aggregate amount exceeding $5,000,000;

(m) a Change in Control shall occur;

(n) any Credit Party shall fail to observe or perform any covenant, condition or
agreement contained in (i) Section 5(a)(i) or 6 of the Pledge Agreement or
(ii) Section 4.2, 4.4(a) or 4.4(b) of the Security Agreement;

(o) any Guarantor shall deny that it has any further liability under the
Guaranty to which it is a party, or shall give notice to such effect;

(p) any material provision of any Credit Document shall for any reason cease to
be valid and binding on or enforceable against any Credit Party or any
Subsidiary of any Credit Party party thereto or any Credit Party or any
Subsidiary of any Credit Party shall so state in writing or bring an action to
limit its obligations or liabilities thereunder or any action shall be taken by
any Credit Party or any Subsidiary to discontinue or to assert the invalidity or
unenforceability of any such Credit Document; or any Collateral Document shall
for any reason (other than pursuant to the terms thereof) cease to create a
valid security interest in the Collateral purported to be covered thereby or
such security interest shall for any reason (other than the failure of the
Administrative Agent to take any action within its control) cease to be a
perfected and first priority security interest (subject to Liens expressly
permitted by Section 6.02);

 

89

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

(q) the subordination provisions of any agreement or instrument relating to any
Subordinated Indebtedness shall for any reason be revoked or invalidated, or
otherwise cease to be in full force and effect, or any Person shall contest in
any manner the validity or enforceability thereof or deny that it has any
further liability or obligation thereunder, or the Obligations, for any reason
shall not have the priority contemplated by this Agreement or such subordination
provisions;

(r) (i) any Subordinated Indebtedness shall be prepaid, redeemed or repurchased
in whole or in part or an offer to prepay, redeem or repurchase the Subordinated
Indebtedness in whole or in part shall have been made, in each case, except as
otherwise expressly permitted hereby, (ii) the subordination provisions of any
Subordinated Indebtedness is found by any court, or asserted by the trustee in
respect of, or any holder of, Subordinated Indebtedness in a judicial proceeding
to be, invalid or unenforceable or (iii) any Credit Party breaches or fails to
comply with any of the subordination provisions governing any Subordinated
Indebtedness or any other provisions therein expressed to be for the benefit of
the Administrative Agent, the Required Lenders or any Lender;

(s) (i) the Borrower, any Subsidiary, the Austin Partnership or RAM shall lose,
fail to keep in force, suffer the termination, suspension or revocation of, or
terminate, forfeit or suffer a adverse amendment to, any Necessary
Authorizations at any time held by it which would have a Material Adverse
Effect; (ii) the FCC shall schedule or conduct a hearing on the renewal or
revocation of any Necessary Authorizations held by the Borrower, any Subsidiary,
the Austin Partnership or RAM based upon the acts or omissions of the Borrower,
any Subsidiary, the Austin Partnership, RAM or any of their respective
Affiliates and the Required Lenders shall reasonably and in good faith conclude,
after consultation with the Agent’s special communications counsel, that the
result thereof is reasonably likely to be the termination, revocation,
suspension, or material adverse amendment of such Necessary Authorization which
would have a Material Adverse Effect; or (iii) any Governmental Authority other
than the FCC shall commence an action or proceeding seeking the termination,
suspension, revocation or adverse amendment of any Necessary Authorizations held
by the Borrower, any Subsidiary, the Austin Partnership or RAM and the Required
Lenders shall reasonably and in good faith believe that the result thereof shall
be the termination, revocation, suspension or adverse amendment of such
Necessary Authorization which would have a Material Adverse Effect, it being
understood that the Credit Parties acknowledge and agree that the occurrence of
any of the events set forth in this Section (s), individually or in the
aggregate, shall be deemed to have a Material Adverse Effect if they involve the
Necessary Authorizations for one or more Stations that, individually or in the
aggregate, account for ten percent (10%) or more of Consolidated EBITDA for the
most recent period for which financial statements are required to be delivered
pursuant to Section 5.01;

 

90

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

(t) any of the Borrower, any Subsidiary, the Austin Partnership or RAM, shall be
enjoined, restrained or in any way prevented by the order of any Governmental
Authority from conducting any material part of its business and such order shall
continue in effect for more than thirty (30) days, provided that with respect to
any such order relating to the renewal or availability of any Necessary
Authorization, if the issuance of such order would not otherwise constitute an
Event of Default under clause (s) above, it shall not cause an Event of Default
solely by virtue of meeting the criteria of this clause (t);

(u) any contractual obligation which is necessary to the broadcasting operations
of any of the Borrower, any Subsidiary, the Austin Partnership or RAM, shall be
revoked or terminated and not replaced by a substitute, without a Material
Adverse Effect, within ninety (90) days after such revocation or termination;

(v) any (i) order of the FCC relating to any Acquisition permitted hereunder
granting or consenting to a transfer of control or assignment of an FCC License
that is a Necessary Authorization in connection with any Acquisition permitted
hereunder which has been completed shall not have become final and any
Governmental Authority shall have entered an order that has become effective and
has not been stayed reversing such order (whether or not such order shall be
subject to further appeal) or (ii) filing at the FCC of (A) an application for
consent to the substantive transfer of control or assignment of any FCC License
that is a Necessary Authorization held by any Subsidiary, the Austin Partnership
or RAM, other than a filing in connection with a transaction permitted by
Section 6.03 of this Agreement or (B) an application for consent to the
substantive transfer of control of the Borrower or a filing that does not
constitute a Change of Control as defined in this Agreement;

(w) (i) the Austin Partnership or RAM shall incur any Material Indebtedness or
(ii) the partnership agreement or any other governing documents relating to the
Austin Partnership or RAM shall permit, after giving effect to any amendment,
modification or waiver of the terms thereof, or there shall occur, any cash or
other distribution (including any redemption, purchase, retirement or other
acquisition of any partnership interests or return of capital attributable to
any partnership interests) by the Austin Partnership or RAM to all or any of its
partners which is not made simultaneously to all of its partners on a pro rata
basis, in terms of both value and kind, in accordance with such partners’
proportional equity interests in the Austin Partnership or RAM; provided that it
shall not be an Event of Default hereunder if the Borrower or any of its
Subsidiaries receives any distribution in excess of their pro rata share as so
determined or if the Borrower or any of its Subsidiaries receives any repayment
of Indebtedness advanced by the Borrower or any of its Subsidiaries to the
Austin Partnership or RAM; or

(x) the on-the-air broadcast operations of any Station shall be interrupted at
any time for more than seventy-two (72) hours (or, in the event of force
majeure, one hundred twenty (120) hours), whether or not consecutive, during any
period of ten (10) consecutive days, except such interruptions which are
permitted by the rules of the FCC or otherwise authorized by the FCC;

 

91

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

then, and in every such event (other than an event with respect to any Credit
Party described in clause (h) or (i) of this Article), and at any time
thereafter during the continuance of such event, the Administrative Agent may,
and at the request of the Required Lenders shall, by notice to the Borrower,
take either or both of the following actions, at the same or different
times: (i) terminate the Commitments, and thereupon the Commitments shall
terminate immediately, and (ii) declare the Loans then outstanding to be due and
payable in whole (or in part, in which case any principal not so declared to be
due and payable may thereafter be declared to be due and payable), and thereupon
the principal of the Loans so declared to be due and payable, together with
accrued interest thereon and all fees and other obligations of the Borrower
accrued hereunder, shall become due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Credit Parties; and in case of any event with respect to
any Credit Party described in clause (h) or (i) of this Article, the Commitments
shall automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and all fees and other obligations of the
Credit Parties accrued hereunder, shall automatically become due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Credit Parties. Upon the occurrence and the continuance
of an Event of Default, the Administrative Agent may, and at the request of the
Required Lenders shall, exercise any rights and remedies provided to the
Administrative Agent under the Credit Documents or at law or equity, including
all remedies provided under the UCC.

ARTICLE VIII

The Administrative Agent

SECTION 8.01. Appointment. Each of the Lenders and the Issuing Bank hereby
irrevocably appoints the Administrative Agent as its agent and authorizes the
Administrative Agent to take such actions on its behalf, including execution of
the other Credit Documents, and to exercise such powers as are delegated to the
Administrative Agent by the terms of the Credit Documents, together with such
actions and powers as are reasonably incidental thereto.

SECTION 8.02. Rights and Power. The bank serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not the
Administrative Agent, and such bank and its Affiliates may accept deposits from,
lend money to and generally engage in any kind of business with the Borrower or
any Subsidiary or other Affiliate thereof as if it were not the Administrative
Agent hereunder.

 

92

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

SECTION 8.03. Exculpatory Provisions. The Administrative Agent shall not have
any duties or obligations except those expressly set forth in the Credit
Documents. Without limiting the generality of the foregoing, (a) the
Administrative Agent shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default has occurred and is continuing, (b) the
Administrative Agent shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated by the Credit Documents that the Administrative Agent is
required to exercise in writing as directed by the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and (c) except as expressly set
forth in the Credit Documents, the Administrative Agent shall not have any duty
to disclose, and shall not be liable for the failure to disclose, any
information relating to any Credit Party or any of its Subsidiaries that is
communicated to or obtained by the bank serving as Administrative Agent or any
of its Affiliates in any capacity. The Administrative Agent shall not be liable
for any action taken or not taken by it with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as shall
be necessary under the circumstances as provided in Section 9.02) or in the
absence of its own gross negligence or willful misconduct. The Administrative
Agent shall be deemed not to have knowledge of any Default unless and until
written notice thereof is given to the Administrative Agent by the Borrower or a
Lender, and the Administrative Agent shall not be responsible for or have any
duty to ascertain or inquire into (i) any statement, warranty or representation
made in or in connection with any Credit Document, (ii) the contents of any
certificate, report or other document delivered hereunder or in connection with
any Credit Document, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth in any Credit
Document, (iv) the validity, enforceability, effectiveness or genuineness of any
Credit Document or any other agreement, instrument or document, (v) the
creation, perfection or priority of Liens on the Collateral or the existence of
the Collateral, or (vi) the satisfaction of any condition set forth in Article
IV or elsewhere in any Credit Document, other than to confirm receipt of items
expressly required to be delivered to the Administrative Agent.

SECTION 8.04. Administrative Agent Reliance. The Administrative Agent shall be
entitled to rely upon, and shall not incur any liability for relying upon, any
notice, request, certificate, consent, statement, instrument, document or other
writing believed by it to be genuine and to have been signed or sent by the
proper Person. The Administrative Agent also may rely upon any statement made to
it orally or by telephone and believed by it to be made by the proper Person,
and shall not incur any liability for relying thereon. The Administrative Agent
may consult with legal counsel (who may be counsel for the Borrower),
independent accountants and other experts selected by it, and shall not be
liable for any action taken or not taken by it in accordance with the advice of
any such counsel, accountants or experts.

SECTION 8.05. Delegation of Duties. The Administrative Agent may perform any and
all its duties and exercise its rights and powers by or through any one or more
sub-agents appointed by the Administrative Agent. The Administrative Agent and
any such sub-agent may perform any and all its duties and exercise its rights
and powers through their respective Related Parties. The exculpatory provisions
of the preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.

 

93

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

SECTION 8.06. Resignation. Subject to the appointment and acceptance of a
successor Administrative Agent as provided in this paragraph, the Administrative
Agent may resign at any time by notifying the Lenders, the Issuing Bank and the
Borrower. Upon any such resignation, the Required Lenders shall have the right,
in consultation with the Borrower, to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of its resignation, then the retiring Administrative Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Administrative Agent which
shall be a bank with an office in New York, New York, or an Affiliate of any
such bank. Upon the acceptance of its appointment as Administrative Agent
hereunder by a successor, such successor shall succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder. The fees payable by the Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrower and such successor. After the
Administrative Agent’s resignation hereunder, the provisions of this Article and
Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent, its sub agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while it was
acting as Administrative Agent.

SECTION 8.07. Lender Non-Reliance. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any related agreement or any document furnished hereunder or thereunder.

SECTION 8.08. Other Titles. No Lender identified in this Agreement as a
“Documentation Agent” or a “Syndication Agent” shall have any right, power,
obligation, liability, responsibility or duty under this Agreement other than
those applicable to all Lenders as such. Without limiting the foregoing, none of
such Lenders shall have or be deemed to have a fiduciary relationship with any
Lender. Each Lender hereby makes the same acknowledgments with respect to such
Lenders as it makes with respect to the Administrative Agent in this Article
VIII.

SECTION 8.09. Collateral and Guarantee Matters. In its capacity, the
Administrative Agent is a “representative” of the holders of Secured Obligations
within the meaning of the term “secured party” as defined in the UCC. Each
Lender authorizes the Administrative Agent to enter into each of the Collateral
Documents to which it is a party and to take all action contemplated by such
documents. Each Lender agrees that no holder of Secured Obligations (other than
the Administrative Agent) shall have the right individually to seek to realize
upon the security granted by any Collateral Document, it being understood and
agreed that such rights and remedies may be exercised solely by the
Administrative Agent for the benefit of the holders of Secured Obligations upon
the terms of the Collateral Documents. In the event that any Collateral is
hereafter pledged by any Person as collateral security for the Secured
Obligations, the Administrative Agent is hereby authorized, and hereby granted a
power of attorney, to execute and deliver on behalf of the holders of Secured
Obligations any Credit Documents necessary or appropriate to grant and perfect a
Lien on such Collateral in favor of or for the benefit of the Administrative
Agent, on behalf of the holders of Secured Obligations. The Lenders hereby
authorize the Administrative Agent, at its option and in its discretion, to
release any Lien granted to or held by the Administrative Agent upon any
Collateral (i) as described in

 

94

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

Section 9.17(b), (ii) as permitted by, but only in accordance with, the terms of
the applicable Credit Document; or (iii) if approved, authorized or ratified in
writing by the Required Lenders, unless such release is required to be approved
by all of the Lenders hereunder. Upon request by the Administrative Agent at any
time, the Lenders will confirm in writing the Administrative Agent’s authority
to release particular types or items of Collateral pursuant hereto. Upon any
sale or transfer of assets constituting Collateral which is permitted pursuant
to the terms of any Credit Document, or consented to in writing by the Required
Lenders or all of the Lenders, as applicable, and upon at least five
(5) Business Days’ prior written request by the Borrower to the Administrative
Agent, the Administrative Agent shall (and is hereby irrevocably authorized by
the Lenders to) execute such documents as may be necessary to evidence the
release of the Liens granted to the Administrative Agent for the benefit of the
holders of Secured Obligations herein or pursuant hereto upon the Collateral
that was sold or transferred; provided, however, that (i) the Administrative
Agent shall not be required to execute any such document on terms which, in the
Administrative Agent’s opinion, would expose the Administrative Agent to
liability (other than immaterial liabilities) or create any obligation or entail
any consequence other than the release of such Liens without recourse or
warranty, and (ii) such release shall not in any manner discharge, affect or
impair the Secured Obligations or any Liens upon (or obligations of any Credit
Party or any Subsidiary in respect of) all interests retained by the Borrower or
any Credit Party, including (without limitation) the proceeds of the sale, all
of which shall continue to constitute part of the Collateral. Without limiting
the foregoing, if all of the Equity Interests held by the Borrower and its
Subsidiaries in any Subsidiary Guarantor are sold or transferred in a
transaction permitted hereunder (other than to the Borrower or to a Subsidiary
thereof) and the proceeds of such transaction are applied in accordance with the
terms of Section 2.11(c)(i) (or arrangements for such application satisfactory
to the Administrative Agent have been made), such Subsidiary Guarantor and its
subsidiaries shall be released from the Subsidiary Guaranty upon the
consummation of such transaction and the Administrative Agent is hereby
authorized and directed by the Lenders to take any actions deemed appropriate in
order to effect the foregoing.

ARTICLE IX

Miscellaneous

SECTION 9.01. Notices. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy, as follows:

(i) if to the Borrower, to it at One Emmis Plaza, 40 Monument Circle, Suite 700,
Indianapolis, IN 46204, Attention of Ryan Hornaday (E-mail: RHornaday@emmis.com)
with a copy to: Emmis Legal Department, 40 Monument Circle, Suite 700,
Indianapolis, IN 46204 (E-mail: legal@emmis.com);

(ii) if to the Administrative Agent, to JPMorgan Chase Bank, N.A., 1 E. Ohio
Street, Floor 4, Indianapolis, IN 46204, Attention of James M. MacDonald and
Thomas W. Harrison (Telecopy No. (317) 767-8033 and (317) 767-8006), with a copy
to JPMorgan Chase Bank, N.A., 10 S. Dearborn Street, Floor 9, Chicago, IL 60603,
Attention of Hani Zabaneh (E-mail: hani.s.zabaneh@jpmorgan.com) and with a copy
to General Electric Capital Corporation, to it at 11175 Cicero Drive, Suite 600,
Alpharetta, GA 30022 Attention of Emmis Communications Account Manager (Telecopy
No. 678-624-7903);

 

95

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

(iii) if to the Issuing Bank, to it at JPMorgan Chase Bank, N.A., 10 S. Dearborn
Street, Floor 5, Chicago, IL 60603, Attention of Global Trade Services (Telecopy
No. 312-288-8950);

(iv) if to the Swingline Lender, to it at JPMorgan Chase Bank, N.A., 10 S.
Dearborn Street, Floor 7, Chicago, IL 60603, Attention of Susan Thomas
(E-mail: jpm.agency.servicing.1@jpmchase.com) (Telecopy No. 888-303-9732); and

(v) if to any other Lender, to it at its address (or e-mail address) set forth
in its Administrative Questionnaire.

All such notices and other communications (i) sent by hand or overnight courier
service, or mailed by certified or registered mail, shall be deemed to have been
given when received or (ii) sent by facsimile shall be deemed to have been given
when sent, provided that if not given during normal business hours for the
recipient, shall be deemed to have been given at the opening of business on the
next Business Day for the recipient.

(b) Notices and other communications to the Lenders hereunder may be delivered
or furnished by electronic communications (including e-mail and internet or
intranet websites) pursuant to procedures approved by the Administrative Agent;
provided that the foregoing shall not apply to notices pursuant to Article II or
to compliance and no Default certificates delivered pursuant to Section 5.01(c)
unless otherwise agreed by the Administrative Agent and the applicable Lender.
The Administrative Agent or the Borrower (on behalf of the Credit Parties) may,
in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it;
provided that approval of such procedures may be limited to particular notices
or communications. All such notices and other communications (i) sent to an
e-mail address shall be deemed received upon the sender’s receipt of an
acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement), provided that if not given during the normal business hours of
the recipient, shall be deemed to have been given at the opening of business on
the next Business Day for the recipient, and (ii) posted to an Internet or
intranet website shall be deemed received upon the deemed receipt by the
intended recipient at its e-mail address as described in the foregoing clause
(b)(i) of notification that such notice or communication is available and
identifying the website address therefor.

(c) Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto. Notices
sent by hand or overnight courier service, or mailed by certified or registered
mail, shall be deemed to have been given when received and notices delivered
through electronic communications to the extent provided in paragraph (b) of
this Section shall be effective as provided in such paragraph.

 

96

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

SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the Administrative
Agent, the Issuing Bank or any Lender in exercising any right or power hereunder
or under any other Credit Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Issuing Bank and the Lenders
hereunder and under any other Credit Document are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or any other Credit Document or consent to any
departure by any Credit Party therefrom shall in any event be effective unless
the same shall be permitted by paragraph (b) of this Section, and then such
waiver or consent shall be effective only in the specific instance and for the
purpose for which given. Without limiting the generality of the foregoing, the
making of a Loan or issuance of a Letter of Credit shall not be construed as a
waiver of any Default, regardless of whether the Administrative Agent, any
Lender or the Issuing Bank may have had notice or knowledge of such Default at
the time.

(b) Neither this Agreement nor any other Credit Document nor any provision
hereof or thereof may be waived, amended or modified except (x) in the case of
this Agreement, pursuant to an agreement or agreements in writing entered into
by the Borrower and the Required Lenders or (y) in the case of any other Credit
Document, pursuant to an agreement or agreements in writing entered into by the
Administrative Agent and the Credit Party or Credit Parties that are parties
thereto, with the consent of the Required Lenders; provided that no such
agreement shall (i) increase the Commitment of any Lender without the written
consent of such Lender, (ii) reduce the principal amount of any Loan or LC
Disbursement or reduce the rate of interest thereon other than interest accruing
pursuant to Section 2.13(c), or reduce any fees payable hereunder, without the
written consent of each Lender affected thereby, (iii) postpone the scheduled
date of payment of the principal amount of any Loan or LC Disbursement, or any
interest thereon, or any fees payable hereunder, or reduce the amount of, waive
or excuse any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender affected thereby,
(iv) change Section 2.18(b) or (c) in a manner that would alter the pro rata
sharing of payments required thereby, without the written consent of each
Lender, (v) change any of the provisions of this Section or the definition of
“Required Lenders” or any other provision hereof specifying the number or
percentage of Lenders required to waive, amend or modify any rights hereunder or
make any determination or grant any consent hereunder, without the written
consent of each Lender, (vi) change Section 2.20, without the consent of each
Lender (other than any Defaulting Lender), (vii) release any Guarantor from its
obligation under any Guaranty to which it is a party (except as otherwise
permitted herein or in the other Credit Documents), without the written consent
of each Lender (other than any Defaulting Lender), or (viii) except as provided
in any Collateral Document, release all or substantially all of the Collateral,
without the written consent of each Lender (other than any Defaulting Lender);
provided further that no such agreement shall (i) amend, modify or waive
Section 2.20 without the prior written consent of the Administrative Agent, the
Issuing Bank and the Swingline Lender or (ii) amend, modify or otherwise affect
the rights or duties of the Administrative Agent, the Issuing Bank or the
Swingline Lender hereunder without the prior written consent of the
Administrative Agent, the Issuing Bank or the Swingline Lender, as the case may
be. Notwithstanding the foregoing, an agreement entered into pursuant to
Section 2.09(d) by and among the Administrative Agent, the Borrower and the new
or existing Lender(s) whose Commitments have been affected thereby shall be
binding on all parties hereto and the new Lender(s) solely for the purpose of
reflecting any new Lender(s) and their new Commitments and any increase in the
Commitment of any consenting existing Lender.

 

97

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

(c) Notwithstanding the foregoing, no amendment or amendment and restatement of
this Agreement which is in all other respects approved by the Lenders in
accordance with this Section 9.02 shall require the consent or approval of any
Lender (i) which immediately after giving effect to such amendment or amendment
and restatement, shall have no Commitment or other obligation to maintain or
extend credit under this Agreement (as so amended or amended and restated),
including, without limitation, any obligation in respect of any drawing under or
participation in any Letter of Credit and (ii) which, substantially
contemporaneously with the effectiveness of such amendment or amendment and
restatement, shall have been paid in full all amounts owing to it hereunder
(including, without limitation principal, interest and fees). From and after the
effectiveness of any such amendment or amendment and restatement, any such
Lender shall be deemed to no longer be a “Lender” hereunder or a party hereto;
provided, that any such Lender shall retain the benefit of indemnification and
other provisions hereof which, by the terms hereof would survive a termination
of this Agreement.

(d) Within 45 days after any failure by any Lender to consent to a requested
amendment, waiver or modification to any Credit Document in which Required
Lenders have already consented to such amendment, waiver or modification but the
consent of each Lender (or each Lender directly affected thereby, as applicable)
is required with respect thereto, the Borrower may, at its option, notify the
Administrative Agent and such non-consenting Lender of the Borrower’s intention
to obtain, at the Borrower’s expense, a replacement Lender (“Replacement
Lender”) for such non-consenting Lender, which Replacement Lender shall be
reasonably satisfactory to the Administrative Agent. In the event the Borrower
obtains a Replacement Lender within 45 days following notice of its intention to
do so, such non-consenting Lender shall sell and assign its Loans and
Commitments to such Replacement Lender, at par, provided that the Borrower has
reimbursed such non-consenting Lender for its increased costs for which it is
entitled to reimbursement under this Agreement through the date of such sale and
assignment. Upon any such assignment and payment and compliance with the other
provisions of Section 9.4, such replaced Lender shall no longer constitute a
“Lender” for purposes hereof; provided, any rights of such replaced Lender to
indemnification hereunder shall survive.

SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Parent, the Borrower
and each other Credit Party shall pay (i) all reasonable and documented
out-of-pocket expenses incurred by the Administrative Agent, the Syndication
Agent, the Arrangers and their respective Affiliates, including the reasonable
fees, charges and disbursements of counsel (including, without limitation,
special, local and FCC counsel) for the Administrative Agent, the Syndication
Agent and the Arrangers, in connection with the syndication of the credit
facilities provided for herein, the preparation and administration of this
Agreement or any amendments, modifications or waivers of the provisions hereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated), (ii) all reasonable and documented out-of-pocket expenses incurred
by the Issuing Bank in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder and
(iii) all documented out-of-pocket expenses incurred by the Administrative
Agent, the Issuing Bank or any Lender, including the fees, charges and
disbursements of any counsel for the Administrative Agent, the Issuing Bank or
any Lender, in connection with the enforcement or protection of its rights in
connection with this Agreement, including its rights under this Section, or in
connection with the Loans made or Letters of Credit issued hereunder, including
all such documented out-of pocket expenses incurred during any workout,
restructuring or negotiations in respect of such Loans or Letters of Credit.

 

98

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

(b) The Parent, the Borrower and each other Credit Party shall indemnify the
Administrative Agent, the Issuing Bank, the Syndication Agent, the Arrangers and
each Lender, and each Related Party of any of the foregoing Persons (each such
Person being called an “Indemnitee”) against, and hold each Indemnitee harmless
from, any and all losses, claims, damages, penalties, incremental taxes,
liabilities and related expenses, including the fees, charges and disbursements
of any counsel for any Indemnitee, incurred by or asserted against any
Indemnitee arising out of, in connection with, or as a result of (i) the
execution or delivery of the Credit Documents or any agreement or instrument
contemplated thereby, the performance by the parties hereto of their respective
obligations thereunder or the consummation of the Transactions or any other
transactions contemplated hereby, (ii) any Loan or Letter of Credit or the use
of the proceeds therefrom (including any refusal by the Issuing Bank to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such Letter
of Credit), (iii) any actual or alleged presence or release of Hazardous
Materials on or from any property owned or operated by the Parent, the Borrower
or any of its Subsidiaries, or any Environmental Liability related in any way to
the Parent, the Borrower or any of its Subsidiaries, (iv) the failure of the
Borrower or any other Credit Party to deliver to the Administrative Agent the
required receipts or other required documentary evidence with respect to a
payment made by the Parent, the Borrower or such other Credit Party for Taxes
pursuant to Section 2.17, or (v) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a Credit Party or a third
party, and regardless of whether any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, penalties, liabilities or related expenses
are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee. This Section 9.03(b) shall not apply with respect to Taxes
other than any Taxes that represent losses, claims or damages arising from any
non-Tax claim.

(c) To the extent that any Credit Party fails to pay any amount required to be
paid by it to the Administrative Agent, the Issuing Bank or the Swingline Lender
under paragraph (a) or (b) of this Section, each Lender severally agrees to pay
to the Administrative Agent, the Issuing Bank or the Swingline Lender, as the
case may be, such Lender’s Applicable Percentage (determined as of the time that
the applicable unreimbursed expense or indemnity payment is sought of such
unpaid amount; provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by
or asserted against the Administrative Agent, the Issuing Bank or the Swingline
Lender in its capacity as such.

 

99

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

(d) To the extent permitted by applicable law, neither the Parent, the Borrower
nor any other Credit Party shall assert, and each hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit or the use of the proceeds thereof. No Indemnitee shall be
liable for any damages arising from the use by unintended recipients of any
information or other materials distributed by it through telecommunications,
electronic or other information transmission systems in connection with this
Agreement or the other Credit Documents or the transactions contemplated hereby
or thereby except to the extent such damages are found by a final,
non-appealable judgment of a court to arise from the willful misconduct or gross
negligence of such indemnified person.

(e) All amounts due under this Section shall be payable not later than 10 days
after written demand therefor.

SECTION 9.04. Successors and Assigns. (a) The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), except that (i) the Borrower
may not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender (and any attempted assignment
or transfer by the Borrower without such consent shall be null and void) and
(ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
(including any Affiliate of the Issuing Bank that issues any Letter of Credit),
Participants (to the extent provided in paragraph (c) of this Section) and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more Persons (other than Ineligible Institutions)
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans at the time owing to it) with
the prior written consent (such consent not to be unreasonably withheld) of:

(A) the Borrower, provided that no consent of the Borrower shall be required for
an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if a
Default has occurred and is continuing, any other Person; and provided that the
Borrower shall be deemed to have consented to any such assignment unless it
shall object thereto by written notice to the Administrative Agent within 5
Business Days after having received notice thereof;

(B) the Administrative Agent, provided that no consent of the Administrative
Agent shall be required for an assignment of (x) any Revolving Commitment to an
assignee that is a Lender with a Revolving Commitment immediately prior to
giving effect to such assignment and (y) all or any portion of a Term Loan to a
Lender, an Affiliate of a Lender or an Approved Fund; and

 

100

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

(C) the Issuing Bank, provided that no consent of the Issuing Bank shall be
required for an assignment of all or any portion of a Term Loan to a Lender, an
Affiliate of a Lender or an Approved Fund.

(ii) Assignments shall be subject to the following additional conditions:

(A) except in the case of an assignment to a Lender, an Affiliate of a Lender or
an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Commitment or Loans of any Class, the amount of the
Commitment or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$5,000,000 or, in the case of a Term Loan, $1,000,000 unless each of the
Borrower and the Administrative Agent otherwise consent, provided that no such
consent of the Borrower shall be required if an Event of Default has occurred
and is continuing;

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement,
provided that this clause shall not be construed to prohibit the assignment of a
proportionate part of all the assigning Lender’s rights and obligations in
respect of one Class of Commitments or Loans; provided, further that section
9.04(b)(ii)(B) shall not be construed to prohibit assignment of a proportionate
part of all the assigning Lender’s rights and obligations in respect of one
Class of Commitments or Loans;

(C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500 (such fee to be waived in connection with any
assignment by any Lender that was a Lender on the Effective Date); and

(D) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire in which the assignee
designates one or more Credit Contacts to whom all syndicate-level information
(which may contain material non-public information about the Borrower and its
affiliates, the Credit Parties and their related parties or their respective
securities) will be made available and who may receive such information in
accordance with the assignee’s compliance procedures and applicable laws,
including Federal and state securities laws.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment
and Assumption the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of Sections
2.15, 2.16, 2.17 and 9.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 9.04
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section.

 

101

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

(iv) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amount (and
stated interest) of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”). The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent,
the Issuing Bank and the Lenders shall treat each Person whose name is recorded
in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary. The Register
shall be available for inspection by the Borrower, the Issuing Bank and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.

(v) Upon its receipt of a duly completed Assignment and Assumption executed by
an assigning Lender and an assignee, the assignee’s completed Administrative
Questionnaire (unless the assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall accept such Assignment and Assumption
and record the information contained therein in the Register; provided that if
either the assigning Lender or the assignee shall have failed to make any
payment required to be made by it pursuant to Section 2.05(c), 2.06(d) or (e),
2.07(b), 2.18(d) or 9.03(c), the Administrative Agent shall have no obligation
to accept such Assignment and Assumption and record the information therein in
the Register unless and until such payment shall have been made in full,
together with all accrued interest thereon. No assignment shall be effective for
purposes of this Agreement unless it has been recorded in the Register as
provided in this paragraph.

(vi) Notwithstanding anything to the contrary contained herein, GE Capital shall
have the absolute right, without obligation to obtain any consent of the Credit
Parties or any Lender, to sell or assign to third parties such portion of GE
Capital’s Commitments and Loans as GE Capital deems necessary to enable GE
Capital and its Affiliates to ensure that they have no attributable stake in the
Borrower for purposes of the regulations of the FCC, or any successor agency
thereto, or to otherwise comply with FCC regulations.

 

102

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

(c) (i) Any Lender may, without the consent of the Borrower, the Administrative
Agent, the Issuing Bank or the Swingline Lender, sell participations to one or
more banks or other entities (a “Participant”), other than an Ineligible
Institution, in all or a portion of such Lender’s rights and obligations under
this Agreement (including all or a portion of its Commitments and the Loans
owing to it); provided that (i) such Lender’s obligations under this Agreement
shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations; and (iii) the
Borrower, the Administrative Agent, the Issuing Bank and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 9.02(b) that
affects such Participant. The Borrower agrees that each Participant shall be
entitled to the benefits of Sections 2.14, 2.15, 2.16 and 2.17 (subject to the
requirements and limitations therein, including the requirements under
Section 2.17(f) (it being understood that the documentation required under
Section 2.17(f) shall be delivered to the participating Lender)) to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section; provided that such Participant
(i) agrees to be subject to the provisions of Sections 2.18 and 2.19 as if it
were an assignee under paragraph (b) of this Section; and (ii) shall not be
entitled to receive any greater payment under Sections 2.14, 2.15 or 2.17, with
respect to any participation, than its participating Lender would have been
entitled to receive, except to the extent such entitlement to receive a greater
payment results from a Change in Law that occurs after the Participant acquired
the applicable participation. Each Lender that sells a participation agrees, at
the Borrower’s request and expense, to use reasonable efforts to cooperate with
the Borrower to effectuate the provisions of Section 2.19(b) with respect to any
Participant. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 9.08 as though it were a Lender; provided
that such Participant agrees to be subject to Section 2.18(c) as though it were
a Lender. Each Lender that sells a participation shall, acting solely for this
purpose as a non-fiduciary agent of the Borrower, maintain a register on which
it enters the name and address of each Participant and the principal amounts
(and stated interest) of each Participant’s interest in the Loans or other
obligations under the Credit Documents (the “Participant Register”); provided
that no Lender shall have any obligation to disclose all or any portion of the
Participant Register (including the identity of any Participant or any
information relating to a Participant’s interest in any Commitments, Loans,
Letters of Credit or its other obligations under any Credit Document) to any
person except to the extent that such disclosure is necessary to establish that
such Commitment, Loan, Letter of Credit or other obligation is in registered
form under Section 5f.103-1(c) of the United States Treasury Regulations. The
entries in the Participant Register shall be conclusive absent manifest error,
and such Lender shall treat each Person whose name is recorded in the
Participant Register as the owner of such participation for all purposes of this
Agreement notwithstanding any notice to the contrary. For the avoidance of
doubt, the Administrative Agent (in its capacity as Administrative Agent) shall
have no responsibility for maintaining a Participant Register.

(d) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

 

103

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

SECTION 9.05. Survival. All covenants, agreements, representations and
warranties made by the Credit Parties in the Credit Documents and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement or any other Credit Document shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of the Credit Documents and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any such other party
or on its behalf and notwithstanding that the Administrative Agent, the Issuing
Bank or any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding and
so long as the Commitments have not expired or terminated. Notwithstanding the
foregoing or anything else to the contrary set forth in this Agreement, in the
event that, in connection with the refinancing or repayment in full of the
credit facilities provided for herein, an Issuing Bank shall have provided to
the Administrative Agent a written consent to the release of the Lenders from
their obligations hereunder with respect to any Letter of Credit issued by such
Issuing Bank (whether as a result of the obligations of the Borrower (and any
other account party) in respect of such Letter of Credit having been
collateralized by a deposit of cash with such Issuing Bank in an amount
acceptable to such Issuing Bank in its sole discretion, or being supported by a
letter of credit acceptable to the Issuing Bank in its sole discretion that
names such Issuing Bank as the beneficiary thereunder, or otherwise to the
satisfaction of such Issuing Bank), then from and after such time such Letter of
Credit shall cease to be a “Letter of Credit” outstanding hereunder for all
purposes of this Agreement, and the Lenders shall be deemed to have no
participations in such Letter of Credit, and no obligations with respect
thereto, under Section 2.05(d) or 2.05(e). The provisions of Sections 2.14,
2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive and remain in full
force and effect regardless of the consummation of the transactions contemplated
hereby, the repayment of the Loans, the expiration or termination of the Letters
of Credit and the Commitments or the termination of this Agreement or any
provision hereof.

SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement, the other
Credit Documents and any separate letter agreements with respect to fees payable
to the Administrative Agent constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 4.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts hereof which, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page of this Agreement by telecopy or any other electronic means
that reproduces an image of the actual executed signature page shall be
effective as delivery of a manually executed counterpart of this Agreement.

 

104

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

SECTION 9.07. Severability. Any provision of any Credit 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 thereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each 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 and all deposits (general or special, time or demand, provisional
or final) at any time held and other obligations at any time owing by such
Lender or Affiliate to or for the credit or the account of the Borrower or any
other Credit Party against any of and all the obligations of the Borrower or any
other Credit Party now or hereafter existing under this Agreement held by such
Lender, irrespective of whether or not such Lender shall have made any demand
under this Agreement and although such obligations may be unmatured. The rights
of each Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.

SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process.
(a) This Agreement shall be construed in accordance with and governed by the law
of the State of New York.

(b) The Parent, the Borrower and each other Credit Party hereby irrevocably and
unconditionally submits, for itself and its property, to the exclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement or any other Credit 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 such New York State 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. Nothing in this Agreement or any other
Credit Document shall affect any right that the Administrative Agent, the
Issuing Bank or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement or any other Credit Document against any Credit Party
or its properties in the courts of any jurisdiction.

(c) Each of the Parent, the Borrower and each other Credit Party hereby
irrevocably and unconditionally waives, to the fullest extent it may legally and
effectively do so, any objection which 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 any other Credit Document in any court referred to in
paragraph (b) of this Section. 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.

(d) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 9.01. Nothing in this Agreement or
any other Credit Document will affect the right of any party to this Agreement
to serve process in any other manner permitted by law.

 

105

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

SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER CREDIT DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

SECTION 9.11. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

SECTION 9.12. Confidentiality. (a) Each of the Administrative Agent, the Issuing
Bank and the Lenders agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its and its
Affiliates’ directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process,
(d) to any other party to this Agreement, (e) in connection with the exercise of
any remedies hereunder or any suit, action or proceeding relating to this
Agreement or the enforcement of rights hereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to
(i) any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement or
(ii) any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Borrower and its obligations, (g) with
the consent of the Borrower or (h) to the extent such Information (i) becomes
publicly available other than as a result of a breach of this Section or
(ii) becomes available to the Administrative Agent, the Issuing Bank or any
Lender on a non-confidential basis from a source other than the Borrower. For
the purposes of this Section, “Information” means all information received from
the Borrower relating to the Borrower or its business, other than any such
information that is available to the Administrative Agent, the Issuing Bank or
any Lender on a non-confidential basis prior to disclosure by the Borrower;
provided that, in the case of information received from the Borrower after the
date hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

 

106

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

(b) EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.12(a)
FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC
INFORMATION CONCERNING THE BORROWER AND ITS RELATED PARTIES OR THEIR RESPECTIVE
SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING
THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL
NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW,
INCLUDING FEDERAL AND STATE SECURITIES LAWS.

(c) ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY
THE BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF
ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY
CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE PARENT, THE BORROWER, AND
THEIR AFFILIATES, THE CREDIT PARTIES AND THEIR RELATED PARTIES OR THEIR
RESPECTIVE SECURITIES. ACCORDINGLY, EACH LENDER REPRESENTS TO THE BORROWER AND
THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS ADMINISTRATIVE
QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION THAT MAY CONTAIN
MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS COMPLIANCE PROCEDURES AND
APPLICABLE LAW.

SECTION 9.13. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the “Charges”), shall exceed the maximum
lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.

SECTION 9.14. USA PATRIOT Act. Each Lender that is subject to the requirements
of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”) hereby notifies each Credit Party that pursuant to the
requirements of the Act, it is required to obtain, verify and record information
that identifies each such Credit Party, which information includes the name and
address of each such Credit Party and other information that will allow such
Lender to identify such Credit Party in accordance with the Act.

 

107

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

SECTION 9.15. No Fiduciary Duty. The Administrative Agent, each Lender and their
Affiliates (collectively, solely for purposes of this paragraph, the “Lenders”)
may have economic interests that conflict with those of the Borrower, its
stockholders and/or its Affiliates. Each Credit Party agrees that nothing in the
Credit Documents or otherwise will be deemed to create an advisory, fiduciary or
agency relationship or fiduciary or other implied duty between any Lender, on
the one hand, and each such Credit Party, its stockholders or its Affiliates, on
the other. Each Credit Party acknowledges and agrees that (i) the transactions
contemplated by the Credit Documents (including the exercise of rights and
remedies hereunder and thereunder) are arm’s-length commercial transactions
between the Lenders, on the one hand, and the Credit Parties, on the other, and
(ii) in connection therewith and with the process leading thereto, (x) no Lender
has assumed an advisory or fiduciary responsibility in favor of any Credit
Party, its stockholders or its Affiliates with respect to the transactions
contemplated hereby (or the exercise of rights or remedies with respect thereto)
or the process leading thereto (irrespective of whether any Lender has advised,
is currently advising or will advise any Credit Party, its stockholders or its
Affiliates on other matters) or any other obligation to the Credit Parties
except the obligations expressly set forth in the Credit Documents and (y) each
Lender is acting solely as principal and not as the agent or fiduciary of the
Credit Parties, its management, stockholders, creditors or any other Person.
Each Credit Party acknowledges and agrees that it has consulted its own legal
and financial advisors to the extent it deemed appropriate and that it is
responsible for making its own independent judgment with respect to such
transactions and the process leading thereto. Each Credit Party agrees that it
will not claim that any Lender has rendered advisory services of any nature or
respect, or owes a fiduciary or similar duty, to such Credit Party in connection
with such transactions or the process leading thereto.

SECTION 9.16. FCC Approval. Notwithstanding anything to the contrary contained
in this Credit Agreement or in the other Credit Documents, neither the
Administrative Agent nor any Lender will take any action pursuant to this Credit
Agreement or any of the other Credit Documents, which would constitute or result
in (i) a change in control of the Borrower any of its Subsidiaries or (ii) an
assignment of any FCC Licenses, which, in each case, would require the prior
approval of the FCC without first obtaining such prior approval of the FCC
unless authorized to do so by a court in connection with the appointment of a
trustee in bankruptcy or a receiver. After the occurrence of an Event of
Default, each Credit Party shall take or cause to be taken any action which the
Administrative Agent may reasonably request in order to obtain from the FCC such
approval as may be necessary to enable the Administrative Agent to exercise and
enjoy the full rights and benefits granted to the Administrative Agent, for the
benefit of the Administrative Agent and the Lenders by this Credit Agreement or
any of the other Credit Documents, including, at the Credit Parties’ cost and
expense, the use of the Credit Parties’ best efforts to assist in obtaining such
approval for any action or transaction contemplated by this Credit Agreement or
any of the other Credit Documents for which such approval is required by law,
including specifically, without limitation, upon request, to prepare, sign and
file with the FCC the assignor’s or transferor’s portion of any application or
applications for the consent to the assignment or transfer of control necessary
or appropriate under the FCC’s rules and approval of any of the transactions
contemplated by this Credit Agreement or any of the other Credit Documents.

 

108

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

SECTION 9.17. Appointment for Perfection; Release of Collateral.

(a) Each Lender hereby appoints each other Lender as its agent for the purpose
of perfecting Liens, for the benefit of the Administrative Agent and the holders
of Secured Obligations, in assets which, in accordance with Article 9 of the UCC
or any other applicable law can be perfected only by possession. Should any
Lender (other than the Administrative Agent) obtain possession of any such
Collateral, such Lender shall notify the Administrative Agent thereof, and,
promptly upon the Administrative Agent’s request therefor shall deliver such
Collateral to the Administrative Agent or otherwise deal with such Collateral in
accordance with the Administrative Agent’s instructions.

(b) The Lenders hereby irrevocably authorize the Administrative Agent, at its
option and in its sole discretion, to release any Liens granted to or for the
benefit of the Administrative Agent by the Parent or any of its Subsidiaries on
any Collateral (i) upon (A) the termination of the Commitments and payment in
full of the Obligations (other than unasserted contingent indemnification
obligations that are not due and payable), (B) the termination or expiration of
any Swap Agreements evidencing any of the Swap Obligations or the substitution
of credit in a manner reasonably satisfactory to any swap counterparty in
respect thereof and (C) the expiration or termination of all Letters of Credit
(or provision therefore in a manner reasonably satisfactory to the Issuing
Bank), (ii) that is sold or to be sold as part of or in connection with any sale
permitted under the Credit Documents or (iii) owned by a Subsidiary Guarantor
upon release of such Subsidiary Guarantor from its obligations under the
Subsidiary Guaranty in connection with any such release permitted under the
Credit Documents. Any such release shall not in any manner discharge, affect, or
impair the Secured Obligations or any Liens (other than those expressly being
released) upon (or obligations of the Credit Parties in respect of) all
interests retained by the Credit Parties, including the proceeds of any sale,
all of which shall continue to constitute part of the Collateral.

[signature pages follow]

 

109

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

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

 

BORROWER:

 

EMMIS OPERATING COMPANY,

as the Borrower

By   /s/ J. Scott Enright Name:   J. Scott Enright Title:  

Executive Vice President,

General Counsel and Secretary

 

PARENT GUARANTOR:

 

EMMIS COMMUNICATIONS CORPORATION,

as the Parent

By   /s/ J. Scott Enright Name:   J. Scott Enright Title:  

Executive Vice President,

General Counsel and Secretary

[Signature Page to Credit Agreement]

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

SUBSIDIARY GUARANTORS:

 

EMMIS RADIO LICENSE, LLC,

EMMIS RADIO, LLC,

EMMIS LICENSE CORPORATION OF NEW YORK,

EMMIS RADIO LICENSE CORPORATION OF NEW YORK,

EMMIS INTERNATIONAL BROADCASTING CORPORATION,

EMMIS RADIO HOLDING CORPORATION,

EMMIS RADIO HOLDING II CORPORATION,

EMMIS PUBLISHING CORPORATION,

LOS ANGELES MAGAZINE HOLDING COMPANY, INC.,

MEDIATEX COMMUNICATIONS CORPORATION,

EMMIS PUBLISHING, L.P.,

ORANGE COAST KOMMUNICATIONS, INC.,

EMMIS INDIANA BROADCASTING, L.P.,

By   /s/ J. Scott Enright Name:   J. Scott Enright Title:  

Executive Vice President,

General Counsel and Secretary

[Signature Page to Credit Agreement]

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

JPMORGAN CHASE BANK, N.A., individually and as Administrative Agent, By   /s/
Thomas W. Harrison Name:   Thomas W. Harrison Title:   Senior Vice President /
Authorized Officer

[Signature Page to Credit Agreement]

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

 

GENERAL ELECTRIC CAPITAL CORPORATION,

as a Lender and as Syndication Agent,

By   /s/ Marshall T. Mangum, III Name:   Marshall T. Mangum, III Title:   Duly
Authorized Signatory

[Signature Page to Credit Agreement]

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

FIFTH THIRD BANK,

as a Lender and as Documentation Agent,

By   /s/ William J. Krummen Name:   William J. Krummen Title:   Vice President

[Signature Page to Credit Agreement]

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

Schedule 1.01(a)

PRICING SCHEDULE

 

APPLICABLE RATE

   LEVEL  I
STATUS     LEVEL  II
STATUS     LEVEL  III
STATUS     LEVEL  IV
STATUS     LEVEL  V
STATUS  

Eurodollar Spread

     3.50 %      4.00 %      4.25 %      4.75 %      5.00 % 

ABR Spread

     2.50 %      3.00 %      3.25 %      3.75 %      4.00 % 

Commitment Fee Rate

     0.30 %      0.35 %      0.40 %      0.45 %      0.50 % 

For the purposes of this Schedule, the following terms have the following
meanings, subject to the final paragraph of this Schedule:

“Financials” means the annual or quarterly financial statements of the Parent
delivered pursuant to Section 5.01 of this Agreement.

“Level I Status” exists at any date if, as of the last day of the Fiscal Quarter
referred to in the most recent Financials, the Total Leverage Ratio is less than
2.50 to 1.00.

“Level II Status” exists at any date if, as of the last day of the Fiscal
Quarter referred to in the most recent Financials, (i) the Borrower has not
qualified for Level I Status and (ii) the Total Leverage Ratio is less than or
equal to 3.00 to 1.00.

“Level III Status” exists at any date if, as of the last day of the Fiscal
Quarter referred to in the most recent Financials, (i) the Borrower has not
qualified for Level I Status or Level II Status and (ii) the Total Leverage
Ratio is less than or equal to 3.50 to 1.00.

“Level IV Status” exists at any date if, as of the last day of the Fiscal
Quarter referred to in the most recent Financials, (i) the Borrower has not
qualified for Level I Status, Level II Status or Level III Status and (ii) the
Total Leverage Ratio is less than or equal to 4.00 to 1.00.

“Level V Status” exists at any date if the Borrower has not qualified for Level
I Status, Level II Status, Level III Status or Level IV Status.

“Status” means Level I Status, Level II Status, Level III Status, Level IV
Status, or Level V Status.

 

1

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

The Applicable Rate shall be determined in accordance with the foregoing table
based on the Borrower’s Status as reflected in the then most recent Financials.
Adjustments, if any, to the Applicable Rate shall be effective five Business
Days after the Administrative Agent has received the applicable Financials. If
the Borrower fails to deliver the Financials to the Administrative Agent at the
time required pursuant to the Credit Agreement, then the Applicable Rate shall
be the highest Applicable Rate set forth in the foregoing table until five
Business Days after such Financials are so delivered. Until adjusted after the
Effective Date upon receipt by the Administrative Agent of the first compliance
certificate delivered pursuant to and accordance with Section 5.01(c) of this
Agreement, Level V Status shall be deemed to exist.

If, as a result of any restatement of or other adjustment to the Financials of
the Parent, the Borrower and its Subsidiaries or for any other reason,
Administrative Agent determines that (a) the Total Leverage Ratio as calculated
by the Parent, the Borrower or any of its Subsidiaries as of any applicable date
was inaccurate and (b) a proper calculation of the Total Leverage Ratio would
have resulted in different pricing for any period, then (i) if the proper
calculation of the Total Leverage Ratio would have resulted in higher pricing
for such period, Borrower shall automatically and retroactively be obligated to
pay to Administrative Agent, for the benefit of the applicable Lenders, promptly
on demand by Administrative Agent, an amount equal to the excess of the amount
of interest and fees that should have been paid for such period over the amount
of interest and fees actually paid for such period; and (ii) if the proper
calculation of the Total Leverage Ratio would have resulted in lower pricing for
such period, neither Administrative Agent nor any Lender shall have any
obligation to repay any interest or fees to Borrower; provided that if, as a
result of any restatement or other event a proper calculation of the Total
Leverage Ratio would have resulted in higher pricing for one or more periods and
lower pricing for one or more other periods (due to the shifting of income or
expenses from one period to another period or any similar reason), then the
amount payable by Borrower pursuant to clause (i) above shall be based upon the
excess, if any, of the amount of interest and fees that should have been paid
for all applicable periods over the amount of interest and fees paid for all
such periods.

 

2

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

Schedule 2.01

Commitments

 

Lender

   Revolving
Commitments      Term Commitments      Total Commitments  

JPMorgan Chase Bank, N.A.

   $ 7,000,000.00       $ 28,000,000.00       $ 35,000,000.00   

General Electric Capital Corporation

   $ 7,000,000.00       $ 28,000,000.00       $ 35,000,000.00   

Fifth Third Bank

   $ 6,000,000.00       $ 24,000,000.00       $ 30,000,000.00   

TOTAL

   $ 20,000,000.00       $ 80,000,000.00       $ 100,000,000.00   

 

1